Filing a Precedent H Costs Budget & a Precedent R Budget Discussion Report
6 minutesWhen a party is legally represented in proceedings allocated to the Multi-Track, generally being a case with a monetary value of more than £25,000 and/or where it is estimated that the trial is likely to last more than one day, costs must be managed in accordance with section II of Part 3 and Practice Direction 3D of the Civil Procedure Rules (“the CPR”).
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When a party is legally represented in proceedings allocated to the Multi-Track, generally being a case with a monetary value of more than £25,000 and/or where it is estimated that the trial is likely to last more than one day, costs must be managed in accordance with section II of Part 3 and Practice Direction 3D of the Civil Procedure Rules (“the CPR”).
To enable the court to manage the costs of the proceedings each party to a claim must file and serve a costs budget in a prescribed form, known as Precedent H, recording the costs that they will have incurred through to the Costs and Case Management Conference (including pre-action costs and costs incurred in relation to statements of case and the issuing of proceedings) and estimating the total costs that they are likely to incur in respect of the further phases of the proceedings through to trial. This includes disclosure, witness statements, expert reports, Pre-Trial Review, trial preparation, alternative dispute resolution and contingencies for anticipated costs which do not fall within any other phase of the Precedent H Costs Budget and are more likely than not to be incurred.
1. Precedent H Costs Budget
In accordance with CPR Rule 3.13 a party’s Precedent H Costs Budget must be filed with their Directions Questionnaire where the stated value on the Claim Form is less than £50,000.00, or no later than 21 days before the first Case Management Conference in any other case. If a party fails to file a Precedent H Costs Budget despite being required to do so they will be treated as having filed a budget comprising only the applicable court fees unless the court orders otherwise.
Where the monetary value of the claim is less than £50,000 or the costs claimed are less than £25,000 the parties must only use the first page of the Precedent H Costs Budget.
2. Precedent R Costs Budget
In the event that a party files and serves a Precedent H Costs Budget in accordance with the CPR under paragraph all other parties in the proceedings (excluding litigants in person) must file an agreed Precedent R Budget Discussion Report no later than 7 days before the first Case Management Conference.
A Precedent R Budget Discussion Report records the budgeted costs claimed on a party’s Precedent H Costs Budget and the quantum of costs that the other party is prepared to agree in respect of each phase together with their comments as to why the full costs claimed are not agreed.
3. What if Costs Budgets can’t be agreed upon?
If Costs Budgets cannot be agreed between the parties the court will record the extent of the agreed costs (if any) and/or either approve or vary the claimed costs at the Costs Case Management Conference on the basis of what are reasonable and proportionate costs of each phase. In deciding the reasonable and proportionate costs of each phase of the Precedent H Costs Budget the court will have regard to, inter alia, the factors set out at CPR Rule 44.3(5) which provides as follows:-
“(5) Costs incurred are proportionate if they bear a reasonable relationship to –
(a) the sums in issue in the proceedings;
(b) the value of any non-monetary relief in issue in the proceedings;
(c) the complexity of the litigation;
(d) any additional work generated by the conduct of the paying party;
(e) any wider factors involved in the proceedings, such as reputation or public importance; and
(f) any additional work undertaken or expense incurred due to the vulnerability of a party or any witness.”
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Jennifer Hardy
Partner