Unrealistic Costs Budgets

In the below case we can see how tough it can be to deal with the Costs Budgeting aspect of legal proceedings. Instructing Hewetts (solicitors in Reading) to assist in pursuing or defending a claim can save you the wrath of the Judge when it comes to the nebulous exercise that is budgeting.

In Jenkins v Thurrock Council Master Thornett has penalised for the second time in quick succession a personal injury claimant who handed in an overly ambitious budget. He said the claimant had presented and maintained an ‘unrealistic and disproportionate’ approach to his estimated costs, considering the demands and requirements of the case. A costs management hearing in July could have been avoided had the claimant taken a ‘more reasonable modified approach’, the judge said, finding that the claimant should pay the defendant’s costs for those proceedings.

‘Specific costs management hearings are not always inevitable,’ said Thornett. ‘Many parties have agreed their respective budgets by the time of the case management conference. Many still do so subsequently, such that the costs management hearing as provided becomes unnecessary and is vacated.’

The ruling is very similar to one the previous day. In Worcester v Hopley, Master Thornett had ordered the claimant pay the costs of the costs management hearing after finding the budget unreasonable.

In Jenkins, the claimant had sought compensation of £200,000 after an injury at work. Thornett said the level of sophistication of the case was ‘towards the lower end of claims’ and ‘entirely typical’ of the sort managed in district registries. ‘There is nothing obviously to suggest why this case should see significantly high estimated legal costs,’ he stated. ‘In seeking substantial future legal costs, the claimant therefore had a reasonably high burden to explain and justify his position at the costs management hearing.’

The claimant had presented a costs budget through to trial for £730,000, as well as £355,000 incurred costs. In comparison, the defendant’s budget was £383,000 in total. Even acknowledging that claimant costs were often higher than those of the defence, the size of the budget ‘plainly calls for careful consideration and reflection’, the judge said.

Thornett added that the claimant continued to take an unrealistic approach to costs despite observations being made at the case management conference and offers to change position from the defendant. The period between the case and costs management conferences should have allowed ‘discussion and negotiation’, he concluded.

For advice on litigation and court matters please contact Oliver Kew at Hewetts Solicitors (Solicitors in Reading) at o.kew@hewetts.co.uk.

Published on 18/09/2024