Guide To The Intermediate Track And Fixed Recoverable Costs

, ,

The legal landscape in the UK civil courts underwent a significant transformation on October 1, 2023, with the introduction of the Intermediate Track and the expanded Fixed Recoverable Costs (FRC) regime. This isn’t just a minor tweak; it’s a fundamental shift designed to bring greater certainty and proportionality to legal costs for claims valued between £25,000 and £100,000.

For legal practitioners and litigants alike, understanding this new framework is no longer optional – it’s essential. This guide will demystify the Intermediate Track, explore the intricacies of FRC, and equip you with the strategic insights needed to thrive in this evolving environment.

What is the Intermediate Track, and Where Does It Fit?

Think of the Intermediate Track as the new “middle ground” in civil litigation. It’s strategically positioned between the Fast Track (for claims up to £25,000) and the Multi-Track (for claims over £100,000). Its core purpose is to handle cases that are too complex for the Fast Track but don’t warrant the extensive costs budgeting and management of the Multi-Track.

For a claim to be allocated to this new track, it must meet specific criteria outlined in CPR 26.9(7) :  

    • Monetary Value: The claim must primarily be for monetary relief between £25,000 and £100,000.  
    • Trial Length: The court must believe the trial can be concluded within three days or less, assuming proportionate management.
    • Expert Evidence: Oral expert evidence at trial is generally limited to two experts per party, with a strong preference for just one unless a second is demonstrably and proportionately required.
    • Number of Parties: Typically, it involves a single claimant against one or two defendants, or two claimants against a single defendant, capping the total at three parties.
    • Suitability: The court must deem the claim suitable for management under the Intermediate Track’s procedural framework.  
    • No Other Factors: There should be no other reasons making the claim inappropriate for this track.

Crucially, claims seeking or including non-monetary relief won’t automatically land in the Intermediate Track. The court must explicitly decide it’s in the “interests of justice” to do so. This introduces a degree of judicial discretion, particularly relevant for cases like many housing claims that often involve non-monetary elements.

Automatic Multi-Track Allocation: Some claims, regardless of value, are automatically allocated to the Multi-Track due to their inherent complexity or sensitive nature. These include mesothelioma and asbestos lung disease claims, most clinical negligence claims (unless breach and causation are admitted), claims for harm to children or vulnerable adults, jury trials, and certain claims against the police.

The Heart of the Matter | Fixed Recoverable Costs (FRC)

At its core, the Intermediate Track is defined by Fixed Recoverable Costs. FRC are predetermined amounts of legal costs that the winning party can recover from the losing party. The aim? To provide certainty and proportionality in legal costs, empowering litigants to make more informed decisions throughout the process.

One of the most significant changes is the absence of costs budgeting and, consequently, no requirement for a Costs and Case Management Conference (CCMC) in the Intermediate Track. This streamlines the process, as costs are fixed rather than subject to detailed assessment. While a Case Management Conference (CMC) may still occur for directions, the focus shifts entirely to adhering to the fixed costs tables.

The specific FRC amounts are detailed in Table 14 of CPR Part 45, Practice Direction 45. These figures vary based on the claim’s complexity band and the stage it has reached in litigation.

The “Battle of the Bands”

Both the Fast Track and Intermediate Track employ a system of four complexity bands (Band 1 being least complex, Band 4 most complex). Each band dictates a different level of recoverable costs, making band allocation a critical strategic battleground.

Here’s a breakdown of the bands as per CPR 26.16 :

    • Band 1: Single issue in dispute, trial under one day. Examples: PI claims where either liability or quantum is disputed, non-PI road traffic claims, defended debt claims.
    • Band 2: Less complex, more than one issue in dispute. Example: PI accident claims where both liability and quantum are disputed.
    • Band 3: More complex, multiple issues, unsuitable for Band 2. Examples: Noise-induced hearing loss (NIHL) and other employer’s liability disease claims.
    • Band 4: Any Intermediate Track claim unsuitable for Bands 1-3. Typically, PI claims with serious issues of fact or law.

The definitions, particularly for Bands 2, 3, and 4, can be ambiguous, leading to a “battle of the bands” where parties strategically frame their pleadings and Directions Questionnaires (DQs) to argue for a higher or lower band. The court ultimately determines the band, considering factors like the nature of the remedy, complexity of facts/law, number of parties, and importance of the claim.

While reassignment is possible for “exceptional reasons” or a “change in circumstances,” the Ministry of Justice has provided no further detailed guidance, leaving interpretation to individual judges. This means the courts’ approach is still largely untested in reported decisions, creating a period of uncertainty for practitioners.  

Calculating Your Costs | Methodology and Adjustments

FRC in the Intermediate Track combine a fixed figure with a percentage of damages. This percentage applies to the sum recovered if the claimant wins, or to the value of the defeated claim if the defendant prevails.

Key adjustments to FRC include:

    • London Weighting: An additional 12.5% uplift on fixed costs applies if the receiving party lives, works, or conducts business in specified London areas and instructs a legal representative there.
    • Inflation Uprating: FRC figures, initially set in 2016, were increased by 3.2% in April 2024 to account for inflation. The MoJ plans to review the regime and costs tables in October 2026, with future adjustments tied to the Services Producer Price Index (SPPI). A crucial point: a claim remains subject to the FRC table in place on its issue date for its entire duration.
    • Additional Claimants: A 25% FRC uplift applies for each additional claimant in claims arising from the same set of facts, compensating for the extra work involved.

Your Strategic Playbook for Practitioners

The Intermediate Track demands a refined approach to litigation:

    • Expedited Procedure & Limitations: Expect standard directions and strict limits: Statements of Case (10 pages), witness statements (30 pages total per party), and expert reports (20 pages, excluding attachments).
    • Expert Evidence: The limitations on experts (generally one per party, two if proportionate) mean highly selective and focused engagement is crucial. This raises concerns about presenting a fully robust case in complex matters.  
    • Part 36 Offers: A Game Changer: The regime significantly enhances incentives for claimants. If a claimant makes a Part 36 offer that’s not accepted, and they equal or better it at trial, they’re entitled to their fixed recoverable costs plus a substantial 35% uplift. This replaces the old 10% uplift and indemnity costs. For defendants, a well-pitched early Part 36 offer can deter claimants from pursuing higher complexity bands, as a higher band means greater costs liability if they fail to beat the offer.
    • Unreasonable Behaviour: The court retains power to adjust FRC by 50% for unreasonable behaviour. If the paying party (e.g., defendant) is unreasonable, they pay an additional 50%; if the receiving party (e.g., claimant) is unreasonable, they recover only half their costs.
    • Vulnerable Parties: While the rules allow costs to exceed FRC for vulnerable parties if their vulnerability necessitated additional work, this “additional work” must be at least 20% greater than the fixed recoverable costs. This 20% threshold is a significant hurdle, creating financial risk for solicitors if the threshold isn’t met or vulnerability isn’t recognized by the court.
    • “Costs Budgeting Light” Pilot: Commencing April 2025, this pilot scheme introduces simplified costs estimates (Precedent Z and Zr) for Intermediate Track cases just outside the FRC regime, and claims between £100,000 and £1 million. It aims to reduce procedural burden and maintain proportionality for these mid-value claims.

Recent Amendments and Future Outlook

The FRC regime is a “living regime,” subject to ongoing refinement:

    • April 2024 Revisions: Fixed trial advocacy fees are now recoverable for cases settling late or vacated shortly before trial (100% if settled on day of trial/day before; 75% if settled/vacated up to five days before trial).
    • Fixed Costs Determination: A new procedure for resolving FRC disputes, with fixed costs, is expected in October 2024, alongside fixed costs for Part 8 (costs only) claims.
    • Housing Claims Delay: FRC implementation for housing claims has been postponed until October 2025 due to concerns about access to justice for tenants. While FRC doesn’t apply, housing claims can still be allocated to the Intermediate Track and assigned complexity bands.
    • October 2026 Review: The Ministry of Justice is committed to a comprehensive review of the extended FRC framework, including costs tables and the impact on vulnerable parties, by October 2026.

Challenges and Uncertainties

Despite its aims, the FRC regime presents challenges:

    • Quality of Representation: Capped costs raise concerns that solicitors may be less willing to invest extensive time in complex cases, potentially impacting service quality.
    • Access to Justice: While intended to improve access, capped costs might deter solicitors from taking on risky or resource-intensive cases, potentially leaving some claimants without representation.
    • Complexity Band Ambiguity: The lack of detailed official guidance and early judicial precedent means accurately classifying cases into complexity bands remains challenging, leading to disputes and uncertainty in cost predictions.  

Conclusion | Your Path Forward

The Intermediate Track and FRC regime are here to stay, fundamentally reshaping civil litigation for mid-value claims. Success in this new environment hinges on a proactive, strategic approach:

    • Early Case Assessment: Meticulously review claims to accurately determine track allocation and complexity band from the outset.
    • Strategic Pleading & DQ Preparation: Craft statements of case and Directions Questionnaires to strategically influence complexity band assignment.
    • Diligent Internal Cost Management: Recognise that recoverable costs are fixed; implement robust internal processes to ensure profitability within the FRC framework. 
    • Master Part 36 Offers: Understand and strategically deploy Part 36 offers, leveraging their enhanced financial incentives for claimants and their power in costs risk management for defendants.
    • Prudent Expert Engagement: Be highly selective with experts, adhering strictly to page and number limits, ensuring their input is proportionate and crucial.
    • Meticulous Documentation for Vulnerability: For vulnerable parties, maintain detailed records of all additional work to support potential claims for increased FRC.
    • Continuous Monitoring: Stay abreast of new CPR amendments, evolving judicial interpretations, and reported decisions as they emerge, adapting your strategies.
    • Clear Client Communication: Provide transparent, upfront guidance on FRC implications, managing expectations regarding costs certainty.

By embracing these strategies, legal practitioners can confidently navigate the new frontier of the Intermediate Track, ensuring efficient case management and optimal outcomes for their clients.

The Extended Fixed Recoverable Costs Regime | 18 Months On

, ,

I. The Extended FRC Regime | Where Are We 18 Months On?

A. The Landscape Shift | October 2023 Overhaul and Its Goals

October 1, 2023, marked the rollout of the extended Fixed Recoverable Costs (FRC) regime; a significant overhaul that expanded FRC to cover most civil claims with a value up to £100,000. Previously, FRC was largely confined to lower-value personal injury claims and small claims. The reforms brought the existing fast track (typically for claims up to £25,000) more comprehensively under FRC and, critically, introduced a new “intermediate track.” This new track was designed for simpler claims valued between £25,000 and £100,000, expected to be triable in three days or less and with limited expert evidence.

The core aims behind this expansion were ambitious: to inject greater certainty and proportionality into legal costs, thereby making the legal process more accessible and predictable for everyone involved.

A key feature of this new system is the introduction of four complexity bands (1 for the least complex, up to 4 for the most complex) within both the fast track and the new intermediate track. These bands determine the level of FRC applicable, based on the perceived intricacy of the case. Unsurprisingly, the allocation of a claim to a specific track and then to a complexity band has become a critical and often hotly contested issue in the early stages of litigation. While the overarching goal was simplification and cost certainty, the breadth of these changes and the initial learning curve meant that the early months were challenging for many legal practitioners.

B. Fine-Tuning the Machine | Key Legislative Tweaks and Procedural Clarifications (October 2023 – Early 2025)

The 18 months since the FRC regime’s extension have seen several legislative adjustments and procedural clarifications aimed at smoothing out some of the initial wrinkles.

One early point of confusion was whether parties could “contract out” of FRC, especially where pre-existing agreements on costs were in place. The Civil Procedure Rule Committee (CPRC) addressed this by amending Civil Procedure Rule (CPR) 45.1(3)(b), effective from April 6, 2024. This crucial amendment clarified that parties can expressly agree in writing that the FRC provisions won’t apply to their dispute, a move welcomed for upholding freedom of contract.

Procedural clarity also improved with the introduction of a structured process for the summary determination of costs in FRC cases, which took effect on October 1, 2024. This involves a new form, Precedent U. Parties looking to claim fixed costs or disbursements must now file and serve Precedent U at least 24 hours before a hearing. This form requires a breakdown of fixed costs claimed, any disputed amounts, and any claims for costs exceeding the standard FRC under specific exceptions. This aims to streamline FRC disputes, with a notable fixed fee of £500 (plus VAT) for a successful Fixed Costs Determination (FCD) application on paper.

The FRC figures themselves have also been adjusted for inflation. The initial tables were based on Sir Rupert Jackson’s 2017 figures, updated using the January 2023 Services Producer Price Index (SPPI). A further 3.2% uplift was applied from April 2024 to account for inflation between January and October 2023. Specific disbursements, like medical reports in low-value RTA whiplash claims, also saw an uprating (25.4% effective from April 6, 2025). These adjustments are vital, but the frequency of future upratings remains a key watchpoint.

These amendments show a responsive approach from rule-makers, but also suggest that the initial rollout didn’t anticipate every practical hurdle. Continuous monitoring of CPR updates is therefore essential for legal professionals.

C. The “Bedding-In” Period | Judicial Interpretation in Early 2025

Despite 18 months having passed, the extended FRC regime is still very much “bedding-in.” A significant reason for this is the relative lack of binding judicial precedent to interpret the new rules’ many nuances. Persistent court backlogs have contributed to this slow emergence of case law.

This means practitioners are often navigating complex FRC issues based on the CPR text, official (but non-binding) guidance, and expert commentary. This naturally leads to some uncertainty.

Furthermore, judges retain considerable discretion in key areas impacting FRC, such as:

    • Initial track allocation (fast, intermediate, or multi-track).
    • Assignment to a complexity band.
    • Interpreting “exceptional circumstances” or “vulnerability” that might justify departing from FRC. This judicial discretion highlights the need for robust, evidence-based arguments on these preliminary issues. The goal of cost certainty is only partially realised if the path to determining those costs is itself uncertain.

II. Key Challenges Emerging Under Extended FRC

The initial 18 months of the extended FRC regime have brought several key challenges and areas of dispute to the forefront.

A. The Battlegrounds: Disputes Over Track Allocation and Complexity Banding

Experience since October 2023 shows that track allocation and complexity banding are frequent and significant points of contention. These initial decisions are crucial as they directly set the FRC figures for the case. It’s common to see claimants arguing for higher tracks or bands to maximise cost recovery, while defendants push for lower ones to minimise exposure.

Factors influencing these decisions include the claim’s financial value, likely trial length (intermediate track cases generally don’t exceed three days), the number and type of expert witnesses (intermediate track usually allows no more than two per party for oral evidence), the number of parties, and overall case complexity. Judicial discretion is key here. Contesting these allocations can become a mini-litigation in itself, potentially adding costs and delays – a seeming paradox when FRC aims to streamline.

B. The Costs Conundrum | Are FRC Levels Adequate? Impact on Access to Justice

A persistent concern, voiced by bodies like the Law Society, is whether the FRC levels truly compensate for the work required, especially in more complex cases caught by the regime. The Law Society warned early on that FRCs are not the same as incurred costs, risking shortfalls for solicitors. This can mean a gap between costs recovered from the losing party and the solicitor’s actual bill to their client.

This has wider implications. It could make certain legal work economically unviable for some firms, potentially limiting client choice and, crucially, access to justice for those with meritorious claims but limited funds to cover cost shortfalls.

The regime does include CPR 45.10, allowing for higher costs if a party’s or witness’s vulnerability led to additional work causing costs to be at least 20% over FRC. The Ministry of Justice (MoJ) is also set to consult further on how rules affect vulnerable individuals. However, proving the direct link between vulnerability, extra work, and the 20% uplift presents practical challenges.

C. Specific Hurdles and Lingering Uncertainties

Beyond track and band disputes, several specific scenarios create ongoing uncertainty:

    • Counterclaims and Multi-Defendant Scenarios: CPR 45.7 generally allows for two sets of FRC if a defendant wins both the claim and a counterclaim, treating the counterclaim as a separate claim, though exceptions apply. The Civil Procedure (Amendment) Rules 2025 further clarify that counterclaims are generally treated as claims. Multi-defendant cases also bring complexity in how FRC applies, with potential for cost sharing or uplifts (e.g., Table 12 in Practice Direction 45 mentions an uplift “per extra defendant” for certain fast track bands ).

    • Cross-Border Litigation: Significant uncertainty remains for cross-border claims under FRC, especially those in the new intermediate track. The MoJ has so far left interpretation to the courts, creating risks in international cases where arguments for multi-track allocation due to complexity may be more common.

    • Housing Claims – A Temporary Exemption: Most housing claims (possession, disrepair, unlawful eviction) have a two-year FRC exemption, delaying their inclusion until at least October 2025. This was due to concerns about access to justice for often vulnerable tenants. Currently, these claims generally follow traditional costs rules, though they are still allocated to a track and complexity band, even if FRC tables don’t apply. The sector awaits news on their future FRC treatment.

D. The Shadow of Satellite Litigation | Costs Disputes About Costs

The Law Society’s early warning about the FRC regime’s ambiguities potentially leading to “years of satellite litigation” still resonates. While a flood of reported judgments hasn’t fully materialised, the potential for disputes over interpretation remains high due to limited precedent. This can lead to parties incurring costs arguing about the costs regime itself. The introduction of the Fixed Costs Determination (FCD) process via Precedent U is an attempt to streamline some of these disputes.

A related concern is the potential for more costs recovery claims by clients against their solicitors. If FRC leads to a significant shortfall between recovered costs and actual fees, and retainers don’t clearly address this, disputes can arise. This highlights the critical need for transparent client communication.

The stage-based FRC structure (costs fixed at defined litigation stages, see tables in PD 45, like Table 14 for the intermediate track ) can also influence settlement behaviour. Parties are aware that reaching the next stage unlocks a higher fixed fee, potentially leading to tactical settlements around these thresholds rather than purely on merit.

III. Maximising Recovery in 2025 | Practical Strategies for Litigants and Solicitors

To successfully navigate the FRC regime in 2025 and maximise cost recovery, a proactive, informed, and strategic approach is essential from day one.

A. Laying the Groundwork | Proactive Case Assessment and Early Strategy

The best chance of maximising recovery starts before a claim is even issued. Solicitors must focus on:

    • Accurate Valuation: A meticulous and realistic valuation of the claim is paramount. This is a primary driver for track allocation and FRC applicability. Over-inflating a claim can cause significant issues later if it’s discontinued or settles for much less, as FRC figures are often linked to claim value at various stages.
    • Early FRC Implications Analysis: A thorough analysis of potential FRC impact should be part of the initial case assessment and client advice. This includes identifying the likely track, complexity band, FRC figures at key stages, and any arguments for escaping or uplifting FRC.

B. Leveraging the Rules | Escaping FRC or Optimising Within It

While FRC aims to fix costs, there are avenues to argue for non-application or higher sums.

  • Aiming for the Multi-Track: For claims under £100,000, escaping the intermediate track (and thus FRC) by securing multi-track allocation is a key strategy. Arguments can be based on:

    • The trial likely exceeding three days.
    • Needing oral expert evidence from more than two experts per party.
    • The case involving more than two defendants (if one claimant) or more than one claimant (if one defendant, depending on specific CPR wording).
    • Overall complexity, even if the value is below £100,000. The judgment in Attersley v UK Insurance Limited EWHC 884 (KB) is significant here. It confirmed that if a claim (even one starting under a pre-action protocol like the RTA Protocol) is later allocated to the multi-track, the FRC regime under Section IIIA of Part 45 ceases to apply – both prospectively and retrospectively, due to CPR 45.29B. This means costs incurred before multi-track allocation would then be assessed on the standard basis, not capped by FRC. This is a powerful precedent.

  • Invoking Exceptions to Uplift FRC: If a claim remains in an FRC track, certain CPR provisions allow for arguments to recover more than the fixed amounts:

    • “Exceptional Circumstances” (CPR 45.9): The court may award costs (excluding disbursements) greater than FRC if “exceptional circumstances” justify it. “Exceptional” isn’t defined, and the threshold is high. With limited appellate guidance on CPR 45.9 under the extended regime, arguments must be meticulously built. The new Precedent U form (Section C) now formalises this application process.
    • Vulnerability (CPR 45.10): This allows for costs exceeding FRC if a party or witness is vulnerable, this vulnerability led to additional work, and that additional work alone caused the costs claim to be at least 20% greater than the standard FRC. This requires robust evidence of vulnerability, the specific extra work, and the 20% uplift calculation.
    • Unreasonable Behaviour (CPR 45.13): If the court finds a party behaved unreasonably, it can order the FRC payable to or by that party to be increased or reduced by 50% of the fixed costs (excluding VAT and disbursements). This can be a useful tool against obstructive opponents.

Effectively navigating these rules is becoming a specialist skill. “FRC optimisation” demands deep procedural and costs knowledge alongside substantive legal understanding.

C. The Power of Part 36 | Strategic Offers to Settle

Part 36 offers remain a critical tactical tool, with complex interactions with FRC. Claimants who beat their own Part 36 offer at trial may get an uplift on their fixed costs (e.g., some rules provide a 35% uplift on fixed costs accruing after the offer’s expiry until judgment).

The Attersley judgment also clarified that if a claim moves to the multi-track, CPR 36.20 (Part 36 costs consequences in FRC cases) doesn’t apply. Instead, the general rule in CPR 36.13 applies. Understanding which Part 36 costs provisions will apply is vital when advising on offers.

D. Clarity is Key: Managing Client Expectations and Agreements

Given FRC can lead to a shortfall between recoverable costs and actual solicitor-client costs, transparent communication and robust retainer agreements are more critical than ever. Agreements must clearly explain:

    • The FRC regime.
    • The anticipated track and band.
    • The potential for recoverable costs to be less than actual costs.
    • How any shortfall will be handled (e.g., payable by the client from damages). This transparency is vital for informed client consent and managing firm risk.

E. Making Disbursements Count | Optimising Recovery

Generally, VAT and “reasonably incurred” disbursements are recoverable on top of fixed costs. However, specific disbursements, like counsel’s fees, need careful attention.

  • Counsel’s Fees: This is a nuanced area.

    • For fast track claims under the extended regime (Section VI of CPR Part 45), CPR 45.44 states only FRC in Table 12 of PD 45 and disbursements in Section IX of Part 45 are allowed. Rule 45.59 details allowable disbursements.
    • Some commentary suggests counsel’s fees for general advice might be subsumed within main fixed stage costs under the extended FRC.
    • However, specific provisions cover trial advocacy fees (e.g., in Table 12 for fast track ). Amendments from April 2024 also cover brief fees if a case settles very close to trial in both fast and intermediate tracks. For instance, 100% of the advocacy fee is recoverable in intermediate track cases settling on the day of trial or one clear day before, and 75% if settling five clear days before.
    • Guideline Hourly Rates for Counsel are being developed, which could further impact fee assessment. Practitioners must meticulously check the specific CPR tables and rules for their claim’s track, band, and stage.

  • Expert Fees: Expert report fees are generally recoverable if reasonably incurred, proportionate, and often as provided for by pre-action protocols or court order.

  • Contentious Disbursements: Recovery of medical agency fees and the need for detailed breakdowns beyond an MRO’s invoice is anticipated to be contentious in 2025, with limited binding case law. Detailed records and robust justification are essential.

F. Quick Reference | Key FRC Amendments and Effective Dates (Post October 2023)

Here’s a summary of key FRC amendments since its major extension:

Amendment/Clarification Relevant CPR / PD Effective Date Brief Description
Extension of FRC to £100k claims / New Intermediate Track CPR Pts 26, 28, 45 1 Oct 2023 FRC extended across the fast track and the new intermediate track for most claims valued up to £100,000.
Initial Inflation Uprating of FRC Tables PD 45 1 Oct 2023 FRC figures based on 2017 Jackson report, uprated using Jan 2023 SPPI.
Further Inflation Uprating of FRC Tables PD 45 (163rd Update) 6 Apr 2024 FRC figures further uprated by 3.2% for inflation (Jan 2023 – Oct 2023 SPPI).
Permission to Contract Out of FRC CPR 45.1(3)(b) 6 Apr 2024 Parties can expressly agree in writing that the FRC regime will not apply to their dispute.
Advocacy Fees for Late Settlement CPR (via 163rd Update) 6 Apr 2024 Specific rules introduced for recovering set percentages of advocacy fees if a case settles close to trial.
FRC Determination Procedure / Precedent U CPR 45 Section X 1 Oct 2024 Structured process for summary determination of FRC disputes, requiring use of new Precedent U form.
Uprating of Fixed Cost Medical Reports (RTA Whiplash) CPR / PD Update 6 Apr 2025 25.4% increase in recoverable costs for specified medical reports in low-value RTA whiplash claims.

Disclaimer: This table is for quick reference. Always consult the latest Civil Procedure Rules and Practice Directions.

IV. On the Horizon | Future FRC Reviews and What to Expect

The FRC regime is not set in stone. Further evolution is likely, with planned reviews and ongoing monitoring.

A. The MoJ/CPRC “Stocktake” – Now Expected October 2025

An initial “stocktake” of the extended FRC regime, first anticipated around February 2025, has been provisionally postponed to October 2025. This delay allows more time for cases to progress through the system, providing a better evidence base for the review. The CPRC’s open meeting in May 2025 is intended to gather initial practitioner views to help frame the stocktake consultation. The MoJ was tasked with drafting an outline stocktake consultation by May 23, 2025. This stocktake is the first major formal opportunity for feedback on the regime’s practical operation.

B. The 2026 Full Post-Implementation Review

A more comprehensive post-implementation review by the MoJ is slated for 2026, aligning with Sir Rupert Jackson’s original 2017 proposal. This broader review will likely assess wider impacts on access to justice, litigation behaviour, and the adequacy of complexity bands and FRC figures.

C. Ongoing Considerations and Consultations

Several specific areas remain under scrutiny:

    • Vulnerable Parties: The MoJ plans further consultation on how FRC rules affect vulnerable parties and witnesses, expected no later than October 2026. This reflects concerns that FRC might disadvantage individuals needing more support.
    • Inflation: Future FRC figure adjustments for inflation (likely using SPPI) will be a recurring factor.
    • Clinical Negligence FRC: FRC for clinical negligence claims under £25,000 is being progressed separately by the Department of Health and Social Care (DHSC) and wasn’t part of the October 2023 reforms. Implementation timelines have been uncertain, though some commentators suggested an October 2025 implementation remained possible as of late 2024.

This cycle of review and amendment means legal professionals must expect ongoing evolution and stay vigilant.

V. Concluding Thoughts | Adapting to the New Costs Landscape in 2025

Eighteen months in, the extended FRC regime clearly aims for long-term cost predictability, but its practical application continues to pose challenges. The “bedding-in” period is ongoing, and 2025 will see practitioners continue to adapt.

A. The Enduring Importance of Early Strategic Advice and Proportionality

Successfully navigating FRC in 2025 requires more than knowing the fixed cost figures. It demands early, insightful strategic advice integrated with case merits from the outset. Key elements include:

    • Meticulous case valuation.
    • Proactive track and complexity band analysis.
    • Realistic assessment of potential exceptions (CPR 45.9, 45.10, 45.13).
    • Candid appraisal of recoverable versus incurred costs for clients.

Proportionality remains paramount. This applies not just to claim value versus costs, but also to deciding which FRC-related battles are worth fighting. The FRC regime seems to be accelerating trends towards thorough early case assessment and greater use of Alternative Dispute Resolution (ADR), as the defined and often limited recoverable costs make litigation risks starker.

B. The Road Ahead: Vigilance and Adaptation

The journey through 2025 will likely involve continued adaptation. Practitioners must stay alert to emerging case law and any further rule changes, especially following the planned October 2025 stocktake.

The evolving nature of this costs landscape highlights the need for continuous professional development. Staying abreast of amendments and refining litigation strategies are essential for effective legal practice in claims up to £100,000. Law firms must also continue adapting their business models and client communication to thrive in this reshaped environment. The FRC regime is actively reshaping civil litigation in England and Wales.

Pushing By Vulnerable Adult Found Not To Constitute “Intentional Harm” Under Para 4.3(8) EL/PL Protocol | However, Claim Escapes On Valuation At Time Of Letter of Claim

, , ,

Background

This case involves Julie Johnson (the Claimant) and her former employer Choice Support (the Defendant). The Claimant had worked with the Defendant for five years, providing care to elderly patients with complex needs. One patient, referred to as “E,” required regular management of his catheter bag.

On 25 December 2018, the Claimant was crouching to empty E’s catheter bag because the stool normally used for this task had broken two days earlier and hadn’t been replaced. E pushed the Claimant, causing immediate back pain. Though she initially recovered, she later developed foot drop (confirmed by MRI), leading to medical treatment and cancellation of a planned holiday. Growing concerns about her long-term health and ability to work safely ultimately led her to pursue a personal injury claim.

The procedural timeline included extensive document exchanges between parties, with the Claimant’s solicitors submitting a Letter of Claim on 14 October 2019, setting the stage for the costs issues. The Defendant raised Points of Dispute on 22 November 2022, challenging the application of the Pre-Action Protocol for Low Value Personal Injury (Employers’ Liability and Public Liability) Claims (“the Protocol”). The detailed assessment hearing took place on 26 February 2025, with judgment issued on 28 April 2025.

Costs Issues Before the Court

The court addressed specific costs issues regarding the Protocol’s applicability:

  1. Whether the claim’s estimated value exceeded the Protocol’s limit
  2. Whether the case involved “harm, abuse or neglect of or by children or vulnerable adults,” explicitly excluded from the Protocol under paragraph 4.3(8)

The Parties’ Positions

The Claimant contended that her solicitors reasonably assessed the claim’s value between £11,730 and £26,050 at the time of the Letter of Claim, placing it outside the Protocol’s limit. This assessment considered her worsening symptoms, potential ongoing medical requirements, and possible future earnings loss.

The Defendant argued that the Claimant’s solicitors had overestimated the claim’s value. They further maintained that although E was clearly a vulnerable adult, the incident didn’t constitute “harm, abuse, or neglect” under paragraph 4.3(8). Drawing on multiple authorities, they emphasized that E’s pushing wasn’t intended to cause injury, nor did E understand that his actions could result in harm.

The Court’s Decision

Deputy Costs Judge Erwin-Jones addressed both contested points.

Regarding claim valuation, the Judge determined that based on evidence available when the Letter of Claim was sent, the Claimant’s solicitors reasonably estimated general damages within the moderate bracket for back injuries (£11,730 to £26,050). Given the Claimant’s persistent symptoms and concerns about future work capacity, the valuation appropriately included potential earnings loss and related costs. The court therefore found it reasonable that the estimated claim exceeded the Protocol limits.

On the paragraph 4.3(8) issue, while acknowledging E was undoubtedly a vulnerable adult, the court found his actions did not constitute “harm, abuse or neglect” as interpreted in previous cases including Lawal v London Borough of Southwark. E’s pushing was a known risk managed through the provision of a stool, and no evidence suggested E possessed awareness or intention to cause harm.

Consequently, the court found that there was an absence of harm, abuse or neglect of or by the vulnerable adult and so, were it not for the reasonably assessed value of the case at the time the Protocol would have applied.

Allocation to Multi-Track Automatically Disapplies Fixed Costs Regime, Enabling Standard Basis Cost Assessment for Part 36 Offer Acceptance

, , , , ,

Background

On 11 April 2025, Mrs Justice Stacey delivered a judgment in the High Court of Justice, King’s Bench Division regarding an appeal in the case of Miss Laura Attersley v. UK Insurance Limited (2025 EWHC 884 (KB)). The appellant, Miss Laura Attersley, initially brought a claim for damages in the tort of negligence following a road traffic accident, and the respondent was UK Insurance Limited, the insurer of the other driver involved.

The claim began under the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents (RTA Protocol), but subsequently exited it at the defendant’s request. The claimant issued Part 7 proceedings claiming up to £150,000 damages and, later, accepted a Part 36 offer from the defendant for £45,000 after the claim had been allocated to the multi-track. The principal matter on appeal was the determination of whether the claimant was entitled to fixed costs or costs assessed on the standard basis up until the point of the expiry of the relevant period of the Part 36 offer accepted late.

The procedural history began on 9 March 2018 when the claimant was involved in a road traffic accident in Southend on Sea, Essex. Ten days later, on 19 March 2018, the claimant’s solicitors submitted a Claim Notification Form (RTA1) under the RTA Protocol. The defendant requested the claim exit the RTA Protocol on 9 April 2018 due to disputed liability. Subsequently, on 29 April 2019, liability was admitted by the defendant. On 12 February 2021, the claimant issued Part 7 proceedings with the particulars of claim dated 13 January 2021, escalating the damages claimed to up to £150,000 based on ongoing physical and psychological issues, supported by medical reports.

The claim was allocated to the multi-track on 5 January 2022, and the trial was scheduled, with extensive expert evidence anticipated. Nearly a year later, on 8 July 2022, the claimant accepted the defendant’s Part 36 offer of £45,000. A subsequent dispute arose regarding the costs consequences of this late acceptance, ultimately leading to the appeal heard on 14 October 2024.

Costs Issues Before the Court

The core issue before the High Court was the costs implications arising from the claimant’s late acceptance of the Part 36 offer. Specifically, the court needed to determine whether the claimant was entitled to her reasonable costs assessed on the standard basis up to the expiry of the Part 36 offer, or whether she was restricted to fixed costs up to that date, pursuant to CPR 36.20 as it was then in force.

Central to the issue was the interplay between CPR 45.29B, which pertains to fixed costs under Section IIIA of Part 45 for cases that have exited the RTA Protocol and not been allocated to the multi-track, and Part 36.20, which encompasses costs consequences of accepting a Part 36 offer for such cases. The contention primarily revolved around whether the rule amendments following Qader v Esure [2017] removed the application of the fixed costs regime upon allocation to the multi-track, thus entitling the claimant to costs assessed on the standard basis.

The Parties’ Positions

The claimant argued that, under CPR 45.29B, the fixed costs regime ceased to apply once the case was allocated to the multi-track, implying she was entitled to costs assessed on the standard basis as per CPR 36.13. Relying on Qader v Esure, she contended that the rule amendment intended to disapply fixed costs retrospectively upon multi-track allocation.

On the other hand, the defendant maintained that the claimant was only entitled to fixed costs until the Part 36 offer acceptance deadline per CPR 36.20. They argued that this interpretation was necessary to prevent an absurd outcome where claimants could benefit disproportionately from late offer acceptances and to uphold the overarching legislative intention to encourage early settlement and cost proportionality.

The Court’s Decision

Mrs Justice Stacey reviewed the statutory provisions and case law to ascertain the proper interpretation of the conflicting CPR rules. The judgment emphasised that the intention behind the CPR amendments following Qader was explicit in disapplying the fixed costs regime upon allocation to the multi-track. The court noted that this applied retrospectively, provided there had been a judicial determination for allocation to the multi-track.

Therefore, the court held that CPR 36.20 did not apply where a case had been allocated to the multi-track. Consequently, the claimant was entitled to her reasonable costs on the standard basis up to the expiry of the relevant period of the Part 36 offer, thereby overturning the lower court’s ruling that limited her to fixed costs.

The appeal was allowed, and the claimant’s costs up to the Part 36 offer expiry were to be assessed based on the standard basis under Part 44 principles. This outcome aligned with the statutory intention of CPR amendments and provided clarity on the costs implications in multi-track allocations.

Interpreter’s Fee Of £924 Deemed Recoverable Under The RTA Protocol But Disproportionate To £20,000 Settlement | Reduced To £794.40

, , , , ,
This case involved a determination regarding the quantum of a specific disbursement in the claim between Raphael De Lima Santiago (the Claimant) and the Motor Insurance Bureau (the Defendant). The procedural journey began when the Claimant, a Brazilian national whose first language is Portuguese, was involved in a road traffic accident on 22 May 2018 while working as a delivery driver in London. The accident, involving a Honda motorcycle driven by him and a scooter driven by Mr Joshua Odubolo, led to the motorcycle being deemed uneconomical to repair. Subsequently, the Claimant’s legal action included a claim for the cost of hiring a replacement motorcycle, amounting to over £46,000. The claim was initiated through the Road Traffic Accident (RTA) Protocol and filed at the County Court Money Claims Centre on 17 May 2021, a day before the expiration of the limitation period. Mr Odubolo did not mount a defense, leading to the Motor Insurers’ Bureau (MIB) being involved as a second defendant due to uncertainties regarding Mr Odubolo’s insurance status. The claim proceeded to trial at the County Court after being allocated to the Fast Track. The Claimant’s witness statement, originally in Portuguese, was translated into English by Bond Turner Solicitors, who also booked an independent interpreter for trial compliance. This direction was necessitated by the court’s conditions, precluding the use of internal translators from the Claimant’s solicitors at trial. On the day of trial, 11 August 2022, the case settled, with the MIB agreeing to pay £20,000 and the Claimant’s costs summarily assessed at £13,746.03. However, the Deputy District Judge Sneddon excluded the Interpreter’s Fee, citing CPR 45.29I(h) and relying on the Court of Appeal’s decision in Cham (A Child) v Aldred. Permission to appeal was granted, leading the matter to the Court of Appeal, which focused on the interpreter’s fee recoverability as a necessary disbursement due to the access to justice principle outlined in the overriding objective and Practice Direction 1A. The Court of Appeal, in its decision dated 14 July 2023, remitted the case for further determination of the reasonableness and proportionality of the interpreter’s fee quantified at £924. The court’s directions included guidelines for the defendant to challenge the fee if necessary within a given timeframe. The case was remitted to the court court and came before HHJ Dight CBE on 6 September 2024. Judgment was handed down on 21 February 2025.

Costs Issues Before the Court

The primary costs issue before the court was the assessment of the interpreter’s fee under CPR 45.29I(h). Following a remittance by the Court of Appeal to consider this disbursement, the central question was whether the fee for instructing an interpreter at the trial of the claim, claimed at £924 including VAT, was proportionate and reasonable. The Defendant’s contention included an alleged failure by the Claimant to provide a breakdown of the fee, suggesting the court either assess the fee at nil or reduce it to £300, drawing on the market rate for such services. The considerations also involved whether any part of the fee constituted an irrecoverable agency element, and if so, the impact of such an element on the recoverability of the total fee.

The Parties’ Positions

The Claimant, represented by Ben Williams KC, maintained that the interpreter’s fee, although involving an intermediary service provider, was a reasonable and proportionate fee within market standards. They argued that the booking was necessitated by the professional service context, and thus, a higher fee encompassing operational costs of the service provider was inevitable. The Claimant supplied comparable market quotations to substantiate their position, indicating the fee fell within a typical range and emphasising that any reduction should still recognise a reasonable market cost. Contrarily, the Defendant, through Robert Marven KC, contended the fee was unreasonably inflated and included an agency component that should not be recoverable under CPR 45.29I(h), referencing Crane v Canons Leisure Centre. They stressed the need for transparency, urging the court to compel disclosure of the fee breakdown, and argued for a reduction to a minimal sum of £300, aligned with direct bookings from public registers of interpreters at standard flat rates.

The Court’s Decision

His Hon Judge Dight CBE held that the interpreter’s fee was indeed a recoverable disbursement under CPR 45.29I(h). The Judge, after a meticulous analysis, rejected the argument that the fee should include an irrecoverable agency component when sourced through an intermediary. It was acknowledged that market practices for obtaining professional services often involve such intermediary costs, and the fee should be judged against prevailing market rates. The Court referenced the competitive market context for such services, drawing on data provided by the Claimant’s costs draftsman, Mr Neil Ryder, which showed a reasonable range of fees from similar service providers. The decision also took into account the proportionality rule under CPR 44.3, considering the entirety of the claim. The Judge held that the £924 fee was at the high end of the market range and was not proportionate to the claim’s settlement value and should be adjusted. Consequently, he determined an adjusted reasonable fee would be £662 plus VAT, totalling £794.40, thereby ensuring the fee was fair, reasonable and aligned with the proportionality bounds in relation to the claim’s overall value.

Medical Agency Fees | “Proportionality Demands Transparency”

, , , ,

Ena Aminu-Edu versus Esure Insurance Company Limited involved a dispute over the recoverability of a medical agency fee within a pain management expert report disbursement. The Claimant argued that under the fixed costs regime, disclosure of a breakdown was unnecessary, while the Defendant maintained that transparency was essential to assess reasonableness and proportionality. The court held that transparency is crucial, and commissioning solicitors should evaluate the reasonableness of agency fees before incurring them. The judge ordered that unless the breakdown was provided, the Claimant’s recoverable costs for the disbursement would be reduced from £2,430 plus VAT to £750 plus VAT.

“The Claimant (or her advisers) can use agencies that are prepared to be transparent rather than those who are not. Alternatively, the work can be done in-house as it always was. It seems to me to be that it would be an enfeebled court system that buckled under any suggestion that a non-transparent cartel would simply withdraw its services en mass from the market if required to be open. The agencies may be cheaper than in-house services in which case the agencies should not hesitate to tell us and should be displaying their proportionality for all to see.”

Read more

£25k Valuation Was Reasonable Despite £11k Settlement | Fixed Costs Not Applied

, , ,

“Firstly, the simple question for the District Judge to answer was whether the claimant’s valuation of the claim in excess of £25,000 at the relevant time in June 2018 was reasonable or not, which the District Judge did consider and address. Second, in my view the burden of proof issue did not assist in the circumstances of this case. Neither party in their written skeleton arguments referred to the burden of proof issue adequately or at all. Mr Hogan, counsel for the defendant, did not say in the hearing below that the burden of proof was decisive in the circumstances of this case.”

Read more

Interpreters’ Fees Recoverable In Addition To Fixed Costs | Court Of Appeal Decision

, , ,

“…an interpretation of sub-paragraph (h) that precluded the recovery of reasonably incurred interpreter’s fees in a case such as the present would not be in accordance with the overriding objective because it would tend to hinder access to justice by preventing a vulnerable party or witness from participating fully in proceedings and giving their best evidence. I would go further and say that it would not be in accordance with the objective of ensuring that the parties are on an equal footing, for essentially the same reasons.”

Read more

Provision For Detailed Assessment In Consent Order Trumps Fixed Costs Regime For Ex-Protocol Claims

, , , ,

Background

In the case of Doyle v M&D Foundations & Building Services Ltd [2022] EWCA Civ 927, the appellant (M&D Foundations & Building Services Limited) was ordered to pay the respondent (Allan John Doyle) damages of £5,000 following an injury the respondent sustained while employed by the appellant. The order, dated 18 July 2018, also mandated that the appellant pay the respondent’s costs, specified as “such costs to be the subject of detailed assessment if not agreed.”

The respondent subsequently lodged a bill of costs for detailed assessment on the standard basis. The appellant contested this, arguing instead that the claim was subject to the fixed recoverable costs regime as outlined in section IIIA of CPR Part 45. This contention was based on the assertion that the claim fell within the category of ex-Protocol low-value personal injury claims, thus entitling the appellant to fixed recoverable costs amount with a determination of only disputed amounts of such costs and disbursements through the fixed costs mechanism.

District Judge Rogers initially rejected the appellant’s contention, concluding that the fixed costs regime did not apply since the parties had contracted out of it, as reflected by the express terms of the consent order. On 13 May 2019, he assessed the respondent’s bill of costs at £14,467.44. The appellant’s appeal against this decision was dismissed by Her Honour Judge Ingram on 10 February 2021. Following this, the appellant brought a second appeal which was granted permission by Stuart-Smith LJ on the grounds of significant legal issues relating to the interpretation of the consent order and its implications for cost recovery under the CPR.

The procedural history also included details of the initial injury sustained by the respondent on 12 May 2014 at a construction site. The injury, while relevant to the procedural context, was not a prominent aspect of the costs issue. The respondent commenced a claim under the Pre-Action Protocol for Low Value Personal Injury (Employers’ Liability and Public Liability) Claims on 25 November 2016. However, after the appellant failed to issue a CNF response, the Protocol ceased to apply, and proceedings were initiated in court.

The case was allocated to the fast track with a trial date scheduled on 19 July 2018. However, before the trial, the appellant extended a Part 36 offer to the respondent, which the respondent did not explicitly accept, instead proposing a consent order for settlement. The settlement included a provision for costs to be “subject to detailed assessment if not agreed,” leading to the current dispute over whether the costs were to be assessed on the standard basis or as fixed costs under the fixed recoverable costs regime.

Costs Issues Before the Court

The costs issues presented required the Court to interpret the consent order’s provision that specified the costs were to be “subject to detailed assessment if not agreed.” Specifically, the Court needed to decide if this wording indicated that the costs should be assessed on the standard basis, or whether, considering the nature of the claim (an ex-Protocol low-value personal injury claim), the fixed recoverable costs regime should apply instead.

The appellant asserted that the fixed costs regime under CPR Part 45 Section IIIA should govern the case because the claim was initiated as an ex-Protocol claim. They argued that the reference to detailed assessment in the consent order implied the process of determining the amount of fixed costs and disbursements. Conversely, the respondent contended that the consent order’s language signified an intention to assess costs on the standard basis, completely outside the bounds of the fixed costs regime. The Court was thus tasked with clarifying whether the consent order’s stipulations contracted out of the fixed costs regime and necessitated a detailed assessment of costs on the standard basis.

The Parties’ Positions

The appellant argued that the term “subject to detailed assessment” could be interpreted to align with the assessment of fixed recoverable costs, particularly for disbursements, as suggested by cases such as Solomon v Cromwell Group plc. They contended that the fixed costs regime is intended to provide predictability and proportionality in costs, and the language in the consent order did not explicitly evince an intent to depart from this regime.

The respondent maintained that the phrase “subject to detailed assessment” is a term of art within the Civil Procedure Rules and unequivocally denotes an assessment on the standard basis unless otherwise specified. The respondent’s interpretation hinged on the rule’s provisions indicating that if an order does not specify the basis of the cost assessment, it defaults to a standard basis assessment. Therefore, they argued that the consent order, by specifying a detailed assessment, inevitably called for an assessment on the standard basis.

Both parties referenced pertinent authorities and principles of contractual interpretation to support their respective contentions. The appellant’s submissions leaned on interpreting the context of ex-Protocol claims and previous judgments that inferred the meaning of “assessment” within the landscape of fixed recoverable costs. The respondent, however, argued for a strict interpretation of the CPR rules and legal definitions, emphasising the consent order’s wording and procedural norms for detailed assessment.

The Court’s Decision

The Court of Appeal, in its analysis, supported the respondent’s interpretation, concluding that the natural and ordinary meaning of “subject to detailed assessment” indeed referred to an assessment on the standard basis. The Court underscored that according to rule 44.3(4)(a) of the CPR, where an order for costs or the method of assessment does not specify otherwise, it defaults to the standard basis.

Furthermore, the Court clarified that while the fixed costs regime does include forms of assessment, particularly regarding the determination of disbursements, this does not equate to a detailed assessment as traditionally understood within the rules for standard basis costs assessment. Citing established principles and prior authorities, the Court reiterated the clear demarcation between fixed costs and assessed costs, emphasising that the rules distinctly handle each to ensure clarity and procedural conformity.

The Court found no exceptional circumstances or compelling evidence to suggest that the parties intended to obfuscate the standard meaning of detailed assessment, nor to contract out of the fixed costs regime under uncertain terms. The reference to detailed assessment in the consent order, absent explicit contrary stipulations, mandated an assessment on the standard basis. Consequently, the appeal was dismissed, thereby affirming lower court rulings and clarifying the application of costs assessment terminology within the procedural framework of the CPR.