The expansion of the fixed recoverable costs (FRC) regime was intended to bring certainty and control to civil litigation costs. By fixing recoverable costs across defined tracks, the rules sought to reduce disputes and limit the scope for argument.

In practice, however, there is growing discussion around whether cases are beginning to move outside the regime on the basis of complexity. While the rules provide a structured framework under CPR Part 45, they also leave room for judicial discretion – particularly at the point of allocation.

This raises a more subtle question: are courts quietly allowing cases to escape fixed costs, not through formal exceptions, but through the way complexity is assessed in practice?

 

The Structure of the FRC Regime

The modern FRC regime applies across the fast track and the intermediate track, with allocation determined by factors including value, complexity, and the nature of the issues in dispute.

In theory, this creates a clear structure. Lower-value and less complex claims fall within fixed costs, while more complex cases are allocated to the multi-track and assessed in the traditional way.

However, the dividing line is not always straightforward. The complexity of the case remains a central factor in allocation decisions, and it is here that the potential for movement outside the regime begins to emerge.

 

Complexity as a Gateway Issue

Allocation is rarely a purely mechanical exercise. While value provides a starting point, the court must also consider the nature of the issues, the volume of evidence, and the procedural demands of the case.

In this context, arguments around complexity have become increasingly significant. Parties may contend that a case is unsuitable for the intermediate track due to factors such as:

• the number of witnesses or experts required
• the extent of disclosure
• the presence of novel or technical issues
• the procedural demands of the litigation

These arguments are not new, but their importance has increased as the scope of fixed recoverable costs has expanded.

 

The “Intermediate Track Stretch”

One of the more interesting developments is what might be described as an “intermediate track stretch”.

On one view, the intermediate track is designed to accommodate a broad range of claims that sit between the fast track and the multi-track. On another, it risks becoming a contested space where parties seek to characterise cases in a way that either brings them within or pushes them beyond the FRC regime.

This can lead to:

• claimants arguing for multi-track allocation to avoid the constraints of fixed costs
• defendants arguing for intermediate track allocation to maintain cost certainty
• increased focus on the allocation stage as a point of strategic importance

The result is that allocation is no longer just a procedural step, but a key battleground in determining the costs regime that will apply.

 

Judicial Discretion in Practice

The court’s discretion plays a central role in this process.

While the rules set out the framework, judges are required to make evaluative decisions about the nature of the case. This includes assessing whether the claim can be dealt with justly within the constraints of the intermediate track, or whether its complexity justifies allocation to the multi-track.

In practice, this involves a degree of judgment that cannot be reduced to a checklist. Two cases of similar value may be treated differently depending on how the court views their complexity and the demands they place on the parties.

This is where the perception of cases “escaping” fixed costs begins to take shape, not through formal departure, but through the exercise of discretion at the allocation stage.

 

Is the FRC Regime Being Undermined?

The question is whether this represents a flaw in the system, or simply the intended flexibility of the rules.

On one view, the ability to move cases out of the FRC regime ensures that complex litigation is not forced into an inappropriate framework. Fixed costs are, by their nature, a blunt instrument, and there will always be cases that fall outside their intended scope.

On another view, however, there is a risk that the regime becomes less predictable if complexity arguments are used too readily. If similar cases are allocated differently, or if the boundaries of the intermediate track are stretched inconsistently, the certainty that fixed costs were designed to achieve may be reduced.

This tension sits at the heart of the current debate.

 

The Role of Case Management

Case management is likely to become increasingly important in this context.

Courts are not only concerned with allocation, but with how cases are conducted once allocated. Where a case begins within the FRC regime but develops in a way that increases its complexity, there may be further arguments about whether it remains suitable for that track.

This raises questions about:

• how flexibility should be applied within the regime
• whether cases can or should move between tracks as they evolve
• the extent to which the court will intervene to ensure proportionality

These issues are still developing and are likely to generate further disputes as the regime continues to bed in.

 

Practical Implications for Litigators

For practitioners, the key point is that complexity has become a central factor in costs strategy.

Parties should be prepared to address:

• how the complexity of the case will be characterised at allocation
• the risk that a case may move outside the FRC regime
• the strategic implications of track allocation for recoverable costs
• the potential for disputes around allocation to shape the overall litigation strategy

In many cases, the argument about where a case sits within the costs regime may be as important as the substantive issues in dispute.

 

A Regime in Transition?

It may be too early to conclude that the FRC regime is being undermined. However, it is clear that its operation is being shaped by the realities of litigation, particularly in cases that sit close to the boundary between tracks.

As more decisions emerge, a clearer picture will develop of how courts are approaching complexity and allocation in practice. For now, the position remains fluid, with

discretion playing a significant role.

How Greener Costs Can Assist

The interaction between fixed recoverable costs and case complexity presents a number of strategic challenges, particularly at the allocation stage.

Greener Costs provides specialist advice on all aspects of the FRC regime, including allocation strategy, disputes over track allocation, and the wider implications of fixed costs for litigation.

Early input can help ensure that the case is positioned effectively from a costs perspective, reducing uncertainty and supporting a more predictable outcome.

If you require assistance, contact Greener Costs today:

📞 01204 263047
📧 info@greenercosts.co.uk

 

Frequently Asked Questions

Can a case move outside the fixed recoverable costs regime due to complexity?

Yes, if a case is considered too complex for the intermediate or fast track, it may be allocated to the multi-track where fixed costs do not apply.

What factors influence allocation decisions?

The court will consider value, complexity, number of parties, volume of evidence, and the overall demands of the case.

Is the intermediate track flexible?

Yes, the intermediate track is designed to accommodate a range of cases, but its boundaries are still developing in practice.

Does allocation affect recoverable costs?

Yes, allocation determines whether fixed recoverable costs apply or whether costs will be assessed in the traditional way.