The October 2023 Expansion: A Recap

The most significant change to civil litigation costs in a generation took effect on 1 October 2023. The Civil Procedure Rule Committee extended the fixed recoverable costs (FRC) regime beyond its traditional personal injury and fast track boundaries, introducing a new intermediate track for claims valued between £25,000 and £100,000.

For solicitors handling civil litigation across a wide range of practice areas – from personal injury and clinical negligence to noise-induced hearing loss and general commercial disputes – the FRC regime now shapes costs recovery in ways that were simply not a factor before October 2023.

More than two years on, the picture is becoming clearer. Courts are applying the regime, complexity band disputes are working their way through the system, and the transitional provisions are gradually falling away. But significant pressure points remain.

 

How the FRC Regime Works

Under the FRC regime, the costs a successful party can recover are fixed by reference to the track the case is allocated to and the complexity band within that track. There is no detailed assessment of costs in the traditional sense – the recoverable figure is set by the Civil Procedure Rules, not by a costs judge.

Fast track cases:  those valued up to £25,000 have been subject to fixed recoverable costs for many years in personal injury litigation. The October 2023 reforms extended and restructured those figures.

Intermediate track cases: valued between £25,000 and £100,000, are the new frontier. These cases are assigned to one of four complexity bands, each carrying its own fixed costs table:

• Band 1: the lowest complexity, lowest recoverable costs
• Band 2: straightforward claims requiring moderate work
• Band 3: more complex matters, including many personal injury and noise-induced hearing loss claims
• Band 4: the highest complexity within the intermediate track, closest to multi-track in terms of recoverable costs

The complexity band is determined at the case management stage, either by agreement or by the court. This has become one of the most actively contested issues in intermediate track litigation.

 

Complexity Band Disputes – The Pressure Point of 2024 and 2025

The allocation of a case to a complexity band has significant financial consequences for both parties. A difference of one band can mean tens of thousands of pounds in recoverable costs, which means solicitors and their clients have strong incentives to argue for the highest appropriate band, and paying parties have equally strong incentives to push back.

Courts have shown a willingness to engage with these arguments, but the case law is still developing. The Civil Procedure Rule Committee has been monitoring the position closely, and further guidance on complexity band allocation is expected as more decisions filter through.

For solicitors, the practical lesson is clear: complexity band arguments need to be made early, supported by detailed evidence about the nature of the claim, and ideally resolved at the first case management hearing rather than left to dispute later in proceedings.

 

Transitional Provisions: Where Things Stand

The October 2023 reforms included transitional provisions for cases already in the system at the date of implementation. Claims issued before 1 October 2023 were generally not subject to the new FRC regime, though the position for claims settled or proceeding to trial after that date required careful analysis.

By 2026, the majority of those transitional cases have now concluded. The transitional provisions are largely spent, and most civil litigation now falls squarely within the new costs regime. Solicitors should no longer assume any transitional protection applies without checking the specific facts of when proceedings were issued and how the claim has progressed.

 

Excluded Claims: Where FRC Does Not Apply

Not every case within the intermediate track value range is subject to fixed recoverable costs. The regime includes a number of important exclusions, including:

• Most clinical negligence claims, which remain on the multi-track with assessed costs
• Cases involving vulnerable parties where fixed costs would cause exceptional hardship
• Claims where the court considers it appropriate to order assessed costs due to the particular complexity or circumstances of the case

The clinical negligence exclusion is significant. Many higher-value clinical negligence claims fall within the £25,000 to £100,000 range but remain outside the FRC regime entirely, meaning detailed assessment of costs continues to apply, and the guideline hourly rates remain the relevant benchmark.

 

What the FRC Regime Means for Costs Recovery in Practice

For solicitors handling fast-track and intermediate-track cases, the FRC regime requires a fundamentally different approach to costs management. Because recoverable costs are fixed, the focus shifts from maximising the bill of costs to ensuring the case is allocated to the correct track and complexity band from the outset.

Key considerations include:

• Accurate track allocation: A case incorrectly allocated to the fast track instead of the intermediate track, or to a lower complexity band, can result in significant under-recovery that cannot be corrected at assessment
• Part 36 offers: The interaction between Part 36 and the FRC regime is complex. A successful Part 36 offer can trigger cost enhancements above the fixed figures, which remain one of the most important tools available to receiving parties
• Disbursements: Fixed recoverable costs cover profit costs only. Disbursements, including counsel’s fees and expert fees, remain separately recoverable and subject to assessment
• Out-of-regime cases: Where a case exits the FRC regime, whether through settlement on terms that engage the escape clause or through allocation to the multi-track, the costs consequences need to be understood and advised upon early

 

Key Takeaways

• The FRC regime expanded significantly in October 2023, introducing fixed costs for intermediate track cases valued between £25,000 and £100,000
• Cases are assigned to one of four complexity bands, each carrying different fixed costs tables
• Complexity band disputes are among the most actively contested costs issues in civil litigation right now
• The transitional provisions from October 2023 are now largely spent
• Clinical negligence and certain other claim types remain excluded from the FRC regime
• Part 36 offers and disbursements remain critical tools for maximising recovery under the fixed costs framework

 

Frequently Asked Questions

What is the fixed recoverable costs regime?

The FRC regime sets fixed amounts that a successful party can recover in costs, determined by the track the case is allocated to and, for intermediate track cases, the complexity band. Unlike detailed assessment, the recoverable figure is prescribed by the Civil Procedure Rules rather than determined by a costs judge.

Which cases does the FRC regime apply to?

Since October 2023, the regime applies to fast-track cases (up to £25,000) and intermediate-track cases (£25,000 to £100,000). Most clinical negligence claims, cases involving vulnerable parties, and certain other categories remain excluded and continue to be subject to assessed costs.

What are the complexity bands in the intermediate track?

The intermediate track has four complexity bands – Band 1 (lowest) to Band 4 (highest). Each band carries its own fixed costs table. The band is determined in case management, either by agreement between the parties or by the court, and has a significant impact on the costs recoverable by the successful party.

Can a case escape the FRC regime?

Yes. Where a case is allocated to the multi-track, or where the court exercises its discretion to order assessed costs due to exceptional circumstances, the fixed costs regime does not apply. The escape clause within the FRC rules can also be triggered in certain circumstances, though the threshold is high.

Are disbursements covered by fixed recoverable costs?

No. Fixed recoverable costs cover profit costs only. Disbursements – including expert fees, counsel’s fees, and court fees – are recoverable separately and remain subject to assessment in the usual way.

How does Part 36 interact with the FRC regime?

A claimant who makes a Part 36 offer that is not accepted and then achieves a result at trial equal to or better than the offer can be entitled to costs enhancements above the fixed figures. This makes Part 36 strategy particularly important in FRC cases, where the base recoverable costs are capped.

 

Speak to Greener Costs Today

The fixed recoverable costs regime has fundamentally changed the way costs are managed in fast-track and intermediate track litigation. Getting track allocation, complexity band arguments, and Part 36 strategy right from the outset is no longer just good practice; it directly determines what your client can recover.

At Greener Costs, our specialist costs lawyers have a thorough understanding of the FRC regime and the emerging case law shaping how it is applied in practice. We support solicitors at every stage, from early costs advice and complexity band arguments through to detailed assessment where the FRC regime does not apply.

If you have a matter where the FRC regime is in play and you want specialist input, get in touch today on 01204 263047 or email info@greenercosts.co.uk.