The Civil Procedure Rule Committee has set up a sub-committee to advise on whether to retain the current exceptions to the mandatory costs management regime which was introduced from 1 April 2013 as part of the Jackson reforms (click here for more information). The current exceptions are: a blanket exception for the Commercial Court; and an exception for claims of over £2 million in the other principal jurisdictions for business-related disputes (the Technology and Construction Court, Chancery Division and Mercantile Courts). The sub-committee has issued a consultation paper requesting views by 20 July and anticipates reporting to the Rule Committee in October this year.
The preliminary view expressed by the sub-committee is that the Commercial Court’s blanket exception may be “unnecessary and inappropriate”. The paper states: “The costs management regime is an important new tool in the attempts to keep the costs of civil litigation within reasonable bounds. The obligation to produce costs budgets (subject to the court’s discretion to direct otherwise) is an important part of that regime and there is no obvious reason why it should not apply to all specialist civil courts.” It stresses, however, that this is a preliminary view only and the sub-committee is interested to hear any reasons that might justify the exception, in particular relating to its effect on the willingness of international parties to choose English jurisdiction.
Depending on its conclusion regarding the Commercial Court exception, the sub-committee will also need to consider whether an exception should be maintained for any category of claims in the other business jurisdictions. The current exception to claims of over £2 million was introduced at the eleventh hour before implementation of the reforms, to avoid the risk of “forum shopping” between those courts and the Commercial Court given the latter’s blanket exclusion from the regime. If there is to be some exception for claims in these courts, the consultation requests views as to whether it should be framed by reference to financial value, and if so at what level, or whether there should be some other formulation given the difficulty of determining financial value for some types of claim (eg. claims for injunctive relief rather than damages).