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If in doubt, budget it out!

Lee Dixon 2 FINALLee Dixon, Costs Lawyer at PIC, suggests that in the face of concern, it’s always better to run a costs budget than not.

I’ve recently seen a case with two conflicting orders; one requiring budgeting and the other dispensing with it; the latter predated the former. The former was an actual order whereas the latter was more like a letter from the Judge. All very confusing.  Timescales are tight and you cannot simply ring a Judge and ask them which Order/direction prevails. Neither can you always write as your letter could spend 15 years in a letter-tray or your email junked.

A more common example is when the court provides notice of proposed allocation to the Fast Track but you think it’s a Multi Track case. Do you do a budget? Arguably no, but then it only takes one genius to find a creative argument and suddenly you’re faced with running a case for court fees…

What is our advice?

Well, we’ve always said, if you’re in any way unsure then do a budget. The cost of doing so is trivial when compared to the draconian ramifications of not doing so (and probably the cost of even a successful relief from sanctions application). Even if not used, it serves a purpose as a useful costs estimate and even lets you keep one eye on the waters for the current costs equivalent of the hungry Great White; proportionality.

In Jamadar v Bradford Teaching Hospitals NHS Trust [2016] EWCA Civ 1001, the Claimant argued that there was no need for a costs budget so they didn’t prepare one. They should have as Judge Gosnell stated:

“Any sensible solicitor, even if they believed that they were right about the law, would probably have prepared the budget”

This was also agreed by Jackson LJ himself.

I suppose the question is; is ‘sensible’ the same as ‘reasonable’?

Google certainly thinks so:

adjective: sensible

  1. done or chosen in accordance with wisdom or prudence; likely to be of benefit.
synonyms: practical, realistic, responsible, full of common sense, reasonable, rational, logical, sound, circumspect, balanced, sober, no-nonsense, pragmatic, level-headed, serious-minded, thoughtful, commonsensical, down-to-earth, wise, prudent, mature;

Now, courtesy of Judge Gosnell, there is also a good argument that even if you were wrong, the question is whether at the time (Francis v Francis and Dickerson) it was ‘sensible’ to prepare a budget. As long as it was, then it follows you should get paid for preparing it.


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