Costs of detailed assessment in costs budgets

PD 47 para.5.19 states:

“The bill of costs must not contain any claims in respect of costs or court fees which relate solely to the detailed assessment proceedings other than costs claimed for preparing and checking the bill.”

Implicit in this is that the costs of preparing and checking the bill are part of the detailed assessment proceedings.

This is consistent with the Court of Appeal’s comments in Crosbie v Munroe [2003] EWCA Civ 350:

“the assessment proceedings cover the whole period of negotiations about the amount of costs payable through the Part 8 proceedings to the ultimate disposal of those proceedings”

However, CPR 47.6 states:

“(1) Detailed assessment proceedings are commenced by the receiving party serving on the paying party –

(a) notice of commencement in the relevant practice form; and
(b) a copy of the bill of costs.”

Self-evidently, in this context, the bill must be drafted before the detailed assessment proceedings are “commenced”.

Precedent H, the document used for costs budgeting, states at the bottom of page one:

“This estimate excludes … costs of detailed assessment…”

Should the costs of preparing a bill therefore be included or excluded from a budget?

The wording of the CPR remains confusing and contradictory as to what work falls within the definition of detailed assessment proceedings (and continues to cause confusion relating to issues over recovery of Part 8 costs and what is included in the provisional assessment cap).

Come on Rules Committee. Sort it out.

7 thoughts on “Costs of detailed assessment in costs budgets

  1. Surely, Simon this is old news! I thought we all knew that the costs of drafting and signing a bill are excluded from the costs of detailed/provisional assessment, unless “Crosbie” applies where there’s been a pre-bill offer and the receiving party has failed to beat it so the paying party does not pay the costs attendant upon the bill. As to including them in a budget; I’m unsure whether it should be claimed as a part of settlement or as a contingency as many actions settle without the need for a formal bill, and finally I’m unsure as to whether the court would allow such a claim given the murkiness/overlap in the rules.

  2. Simon

    You don’t need the Rules Committee to decide whether the costs of preparing a bill are included in or excluded from a budget. The choice is that of the person preparing the budget.

    The Precedent H front-sheet includes the following statement: ‘This estimate excludes VAT (if applicable), success fees and ATE insurance premiums (if applicable), costs of detailed assessment, costs of any appeals, costs of enforcing any judgment and [complete as appropriate].’

    I ‘complete as appropriate’ by inserting before ‘costs of detailed assessment’ the words ‘costs of the budgetary process, costs of preparing and checking formal bill.’

    Excluding the costs of the budgetary process makes sense and is in accordance with what appears to the practice of the QB Masters in London, who require those costs to be shown separately (otherwise you are calculating part of the 1%/2% cap on itself). Excluding the ‘costs of preparing and checking formal bill’ resolves your uncertainty quickly and painlessly.

    I agree that the rules are ‘confusing and contradictory as to what work falls within the definition of detailed assessment proceedings’ and, as I’ve probably commented before, I suspect that the confusion came about because of a last-minute fudge just before the CPR were unveiled, when the LSC realised that if the costs of bill preparation were made recoverable and were treated as costs of detailed assessment, they would fall outside the scope of the statutory charge, so could not be deducted from the client’s damages if not recovered from the paying party. This is, I suggest, borne out by para 15.11 of the LAA’s 2013 Costs Assessment Guidance, which states: ‘Under Regulation 6(1)(b) of the Statutory Charge Regulations, the costs of drawing and checking the bill are not part of the costs of the assessment process, as they are incurred before the commencement of the assessment proceedings. Such work, and the associated costs thus fall within the costs of the main proceedings and count towards the statutory charge and the costs to which the client is required to pay contributions, where relevant (Paragraph 6.43(b) of the Specification).’

    You do like dragging up Crosbie v Munroe, don’t you? I’ve commented on it before. I think it is a poor authority for a number of reasons, but here’s the main one: While the court recognised the distinction between the substantive proceedings and the detailed assessment proceedings (service of notice of commencement being the event which separates the two – see para 23) and was even dismissive of an argument that sought to ‘bundle two disparate sets of “proceedings” together to constitute the “proceedings which gave rise to the assessment proceedings”’ (see para 29) it almost immediately went on to bundle together two disparate sets of costs, namely (i) the costs of the detailed assessment proceedings and (ii) the costs of the Part 8 ‘costs only’ proceedings. There is a leap of logic between paras 33 and 34 which is difficult to follow. This will become clearer if you try to set out the events in that case on a time-line.

    A later decision of the Court of Appeal – Tasleem v Beverley (2014) – covers similar ground. Sharp LJ – saying that he ‘did not think that this interpretation of the rules is contrary to the approach of the Court of Appeal in Crosbie v Munroe – nevertheless arrived at a statement of the law which is arguably inconsistent with that in Crosbie v Munroe. Applying the CA’s logic in Tasleem v Beverley to the facts of Crosbie v Munroe would seem to point to a different conclusion to that reached in the earlier case. In Tasleem v Beverley the CA drew a clear distinction between (a) the costs of the substantive claim, (b) the costs of the detailed assessment proceedings and (c) the costs of the Part 8 ‘costs only’ proceedings, whereas in Crosbie v Munroe the court ran (b) and (c) together, which contradicts the clear statement in Tasleem v Beverley (para 18).

  3. The rules are perfectly clear; budgets exclude any assessment costs; bills are drawn well after budgets; implicitly a bill is needed to commence assessment and are not part of assessment costs; the cost of drawing a bill should be included as a contingency in a budget therefore; the cost of a budget excludes work already done, and should be accounted for separately ; people who invoice a percentage charge to the whole budget without a CMO are wrong; Part 8 costs are brought within the Assessment costs by virtue of how the Courts word them, so if you don’t want them in the cap where they currently fit, then provide a properly worded Order; the PA cap is clear already; drumming up business for the “Rules Committee”, is an abdication of sensibly reading and applying the rules as they stand.

  4. its a budget to trial not to detailed assessment. if it included DA there would be a separate phase. moreover it was also hoped that budgets would reduce the need for bills and DA

    my sweeping views for what its worth

  5. Maybe i will, perhaps you might enlighten us as to what you disagreed with mind

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