Costs News

17 December 2020
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Definition of proportionality to be expanded to include vulnerability

The definition of proportionality in CPR 44.3(5) is to be expanded to take into account the involvement of vulnerability of parties and witnesses.

According to the newly published minutes of its meeting last month, the Civil Procedure Rule Committee has accepted the recommendation of the Civil Justice Council as part of a series of changes to the rules, including the overriding objective, to make explicit provision for vulnerable parties and witnesses.

Rule 44.3(5) says that costs incurred are proportionate if they bear a reasonable relationship to five factors, and the change will see the addition of a sixth – “any additional work generated or expense incurred due to the vulnerability of any party or any witness”.

The minutes highlight a series of other changes to the costs rules that are to be introduced next year following various referrals from the Court of Appeal and others:

  • A part 36 offer should not be permitted to exclude interest, and paragraph 19 of practice direction 47 will be amended accordingly;
  • Rule 36.5(5) will be changed to read: “A part 36 offer to accept a sum of money may make provision for accrual of interest on such sum after the date specified in rule 36.5(4). If such an offer does not make any such provision it is treated as inclusive of all interest up to the date of acceptance”;
  • Rule 3.17 will be put into the form it was meant to be, saying: “(3) Subject to rule 3.15A, the court (a) may not approve costs incurred up to and including before the date of any costs management hearing; but (b) may record its comments on those costs and take those costs into account when considering the reasonableness and proportionality of all budgeted costs”;
  • Three minor changes will be made to practice direction 3E “for the sake of clarity and consistency”:
    • In paragraph 4(b), the word “budgeted” will be replaced with “total costs (incurred and estimated)”;
    • In paragraph 10(a), the word “interlocutory” will be replaced with “interim”; and
    • In the disclosure section of the table in section D, “third party disclosure” will be replaced with “non-party disclosure”.

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