Pursuant to the Jackson Report, Alexander Hutton QC is leading the charge on the new bill of costs project, ahead of the planned Practice Direction due to come into force from the start of October 2015. This will enable parties to use the new bill of costs in cases in the Senior Courts Costs Office instead of the existing model. Comments on the draft new bill of costs are sought by 18 September 2015.

From an insurer’s perspective, the new bill of costs is the long-awaited tool to give proper effect to the costs management regime. An instant comparison between incurred and estimated costs for all phases will be possible, with challenges focused in future upon incurred costs and any areas where the estimated costs exceed those approved without good reason.

Getting the right result at the costs case management conference will become even more important, as this will effectively determine the level of costs likely to be recovered. The indications are that paying parties will require ‘good reason’ to argue that approved costs should be reduced, just as receiving parties will struggle to maintain claims in excess of the approved costs.