I had a very enjoyable morning last week in Derby giving a training session to Geldards solicitors on the practicalities of costs budgeting. Costs budgeting is, of course, expected to become the norm for multi-track matters come April 2013.
(Geldards is a firm that has lucked out having Nicola Mallen has a professional support lawyer. When I saw the quality of the training materials she had already produced on the subject of costs budgeting I almost cancelled. To increase the pressure, Professor Dominic Regan was speaking later in the day. I was just happy it wasn’t the other way around. Dominic is not an easy act to follow.)
As part of the training session I raised the issue as to who should normally undertake the costs budgeting exercise. At this stage I am sure they expected the hard sell to begin. In fact, quite the opposite. I am far from convinced that the majority of Costs Lawyers or law costs draftsman are remotely suited to the job of day-to-day costs budgeting.
It was therefore rather ironic when later that day I checked for updates on the Litigation Futures website to see Iain Stark, Chairman of the Association of Costs Lawyers, being reported as saying:
“The Jackson reforms will put a far greater emphasis on dealing with costs pre-emptively rather than after the event. This means solicitors will need to bring in costs expertise from the start of a case to ensure that the budget they will have to submit to the court at an early stage is realistic and defensible.”
I fear that costs budgeting will be to the cost profession what the PPI scandal was to the banking sector, only worse.
The only thing I would suggest to those considering offering a costs budgeting service in this area, and who hope to remain practising in 5 years time, is to set aside at least 10% of your annual turnover for the next 5 years to ensure you have a sufficient reserve to pay for professional indemnity insurance once the claims starts coming in.