A Practical Guide To The New Intermediate Track Costs Rules

On 1 October 2023, the most transformative changes in years came into effect regarding the costs regime for civil claims valued between £25,000 and £100,000. An entirely new “Intermediate Track” has been created within the civil procedure rules to deal with these claims, alongside a comprehensive fixed recoverable costs matrix tied to complexity bands and stages reached.

This article provides an extensive examination of the key facets of the new regime and offers practical guidance for claimant lawyers on strategising to maximise potential costs recovery.

What Claims are Excluded from Fixed Costs?

The new fixed recoverable costs regime will encompass the large majority of claims valued over £25,000 and up to £100,000. However, there are certain specific carve-outs:

Clinical Negligence Claims

• Clinical negligence claims will only remain in the Intermediate Track and subject to fixed costs in very limited circumstances where liability and causation have already been fully admitted. This aims to deter unreasonable denial of liability.
• Where either breach of duty or causation are disputed to any extent, the claim will exit fixed costs, recognising the often highly complex expert evidence on these issues.
• Even with admissions, if the case involves complex future loss quantification or arguments on appropriate care regimes, the court may still deem it unsuitable for fixed costs.

Claims Involving Children/Vulnerable Adults

• Excluded given the sensitive issues regarding duty of care and safeguarding of vulnerable individuals.
• Public policy justification exists for enabling full reasonable costs recovery in such cases, to ensure claims are brought to hold negligent institutions/individuals accountable and enforce high care standards.
• Detailed expert evidence on vulnerability, care needs, psychological injuries often required also renders these cases unsuitable for capped costs.

Claims With Jury Trial Rights

• Right to jury trial remains in cases where fraud, false imprisonment or malicious prosecution are alleged, reflecting gravity of such issues and preserving jury fact-finding role.
• Defamation retains jury trial rights in limited circumstances, but complexity of defamation law still generally makes such cases unsuited to fixed costs.

Claims Against the Police

• Intentional/reckless police misconduct warrants full reasonable costs recovery given public policy significance.
• Human rights breaches likewise necessitate exclusion given rights such as Articles 2 and 3 under the HRA 1998 are engaged.

Housing Disrepair Claims

• Excluded until 2025 minimum given social policy importance of adequate housing standards.
• Landlord negligence leading to substandard, dangerous living conditions raises serious legal, public health and human rights issues.
• Technical expert evidence on building standards and causation of defects is often required.

Subject to the above carve-outs, the overwhelming majority of claims between £25,000 and £100,000 should be allocated to the new Intermediate Track and subject to fixed recoverable costs.

The Intermediate Track Complexity Band Structure

The Intermediate Track rules establish four complexity bands, ranging from Band 1 for the least complex cases, up to Band 4 for the most complex. The court will assess each case individually and allocate it to the band it deems most fitting based on the issues and evidence involved. The bands are defined as:

• Band 1: Reserved for the most straightforward, low-complexity claims. Only one simple issue in dispute, trial expected to conclude within one day or less. Includes quantum-only disputes in straight-forward PI cases, along with fast track debt recovery and road traffic claims.
• Band 2: Encompasses less complex multi-issue disputes, including typical liability and quantum disputes in PI accidents, but where the injuries and medical evidence involved are relatively simple.
• Band 3: Captures more complex multi-issue claims deemed unsuitable for Band 2. Most commonly includes noise induced hearing loss claims and other typical employers’ liability/industrial disease cases where medical causation, employment histories, liability issues can be complicated.
• Band 4: The highest complexity band in the Intermediate Track, designed to capture claims that would normally fall within its ambit based on value, but involve unusual severity, complexity or wider public interest considerations. Specifically envisages inclusion of PI claims with major factual/legal complications necessitating 3+ day trials.

The Critical Importance of Securing the Right Band

The complexity band that the court ultimately allocates a claim into will have an enormously significant impact on the fixed recoverable costs for claimant lawyers under the Intermediate Track regime. The fixed costs tables prescribe substantially higher sums recoverable at each procedural stage as the bands increase. For illustration:

• Band 1: Maximum £1,600 pre-issue, rising to £6,600 for a fully contested case.
• Band 2: Maximum £5,000 pre-issue, rising to £17,000 for a fully contested case.
• Band 3: Maximum £6,400 pre-issue, rising to £19,000 for a fully contested case.
• Band 4: Maximum £9,300 pre-issue, rising to £29,000 for a fully contested case.

Furthermore, the percentage uplift on damages is higher in Band 2 than Band 1, higher again in Band 3, and highest in Band 4. It is therefore of critical importance that lawyers take every reasonable step open to them to secure allocation into the highest justifiable complexity band.

Tactical Approaches to Securing Band 4 Allocation

There are several core tactics claimant lawyers can adopt to maximise prospects of having appropriate cases allocated to Band 4:

• Provide evidence from medical experts that by reason of the severity, unusualness or complexity of the injuries sustained and the resultant required treatments, it will be essential for 3 or more expert witnesses to address all related issues. Each party is normally restricted to 2 experts in the Intermediate Track, so demonstrating 3+ experts are reasonably required will preclude such allocation.
• Prepare detailed chronologies and case summaries highlighting the number of witnesses, medical issues, employment records, loss quantification variables and other evidential complexities. Use these to estimate that a trial of at least 4 days will be realistically necessary given the volume of evidence for the court to consider. Trials estimated over 3 days cannot be in the Intermediate Track.
• Closely analyze the pleadings and expert evidence to identify and emphasise any unusual or complex legal and factual issues in dispute. Illustrate how these will lengthen trial and complicate liability, causation or quantum considerations.
• Where the client has comorbidities or pre-existing conditions, carefully assess how these interrelate with the injuries sustained and impact expert opinion. Greater complexity arises when pre-existing conditions are relevant.
• Consider directing focused additional questions to medical experts regarding any aspects of injuries sustained and treatments required that are unusual in their experience and specialty. Obtain confirmation that the complexities justify reports from multiple experts.
• Assess opportunities to agree voluntary disclosure of specific relevant documents to support contentions on complexity.
• Ensure when pleading the total overall value of the claim, the figure is pitched as close to the £100,000 upper boundary of the Intermediate Track as can legitimately be justified, even if alleged contributory negligence means any award may ultimately fall under £100,000.

However, as above, any proposals must be grounded in reality, evidence-based, and with exemplary reasonableness. Speculative assertions will undermine credibility. Proportionality is key – requests should not exceed what is warranted for the specifics of the individual case.

Alternative Routes to Sidestep Fixed Costs

In addition to pursuing Band 4 allocation, several other options exist to seek to bypass fixed costs, namely:

• Argue the fully pleaded total value of the claim in fact exceeds £100,000, taking it outside the Intermediate Track based on senior courts guidance that it is the headline claimed value that is decisive, irrespective of likely awards after deductions for alleged contributory negligence. However, great care must be taken to ensure valuations are responsible and evidence-based.
• Submit that the case is exceptionally legally and medically complex such that it warrants allocation to the Multi Track, even though falling between £25,000 and £100,000 based on value. Such submissions would require substantiation from medical experts.
• Establish through detailed analysis that the volume of medical evidence, witnesses, disclosure etc unavoidably means the trial will clearly exceed 3 days, making the case unsuitable for the Intermediate Track.

Once more, reasonableness and proportionality are paramount – speculative assertions will not advance the aim of securing a fair costs recovery.

Conclusions

In summary, the new Intermediate Track and fixed costs regime makes meticulous early case analysis and strategic thinking essential for claimant lawyers seeking to maximise potential costs recovery. Allocation to Band 4 will often be the priority, but pursuing this goal must be balanced against principles of reasonableness and proportionality based on the individual circumstances. Lawyers must also track and learn from trends emerging in how the courts treat cases. With shrewd preparation and presentation, it will remain feasible to secure just costs recovery notwithstanding the challenging new regime.