QOCS Changes – Greener Costs Advises
What is CPR 44?
The Civil Procedure Rules (CPR) in England and Wales are a set of rules governing the procedures for civil litigation in the courts. CPR Part 44 sets out the rules relating to the costs of civil litigation.
In particular, it covers the following aspects:
- The general rule on costs – CPR 44.2(1) provides that the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party.
- The court’s discretion in relation to costs – CPR 44.2(2) provides that the court has discretion as to the amount of costs to be awarded, taking into account various factors, such as the conduct of the parties and any offers made to settle the case.
- Costs budgeting – CPR 44.3 sets out the requirements for costs budgeting in certain cases, where parties must submit a detailed budget of their estimated costs for the case.
- Detailed assessment of costs – CPR 44.4 provides for the detailed assessment of costs, where the court will consider the costs claimed by a party and determine whether they are reasonable and proportionate.
Overall, CPR Part 44 is an important part of the Civil Procedure Rules, as it sets out the rules governing the costs of civil litigation, which can be a significant issue in any case.
What is Qualified One Way Costs Shifting?
QOCS, a legal principle introduced as part of the 2013 Jackson Reforms in England and Wales, affects the recovery of costs in certain civil cases governed by Part 44 of the Civil Procedure Rules. Specifically, in cases involving successful claimants seeking damages for personal injury and other matters, the losing party typically cannot recover their legal costs from the winning party, with exceptions.
Additionally, claimants who lose their case are generally not obligated to pay the defendant’s legal costs, unless the court determines the claim to be fundamentally dishonest or brought for an improper motive without reasonable prospects of success.
The Civil Procedure Rule Committee has recently announced a modification to the qualified one-way cost shifting rules, which will take effect from April 2023. This QOCS changes will empower defendants to enforce costs orders awarded in their favor against the orders given in the claimant’s favour. Ultimately, this QOCS change will modify the current one-way cost shifting system, which protects claimants from having to pay defendants’ costs, even if they lose the case, except in specific circumstances.
The current CPR 44.14 reads as follows:
Effect of qualified one-way costs shifting
(1) Subject to rules 44.15 and 44.16, orders for costs made against a claimant may be enforced without the permission of the court but only to the extent that the aggregate amount in money terms of such orders does not exceed the aggregate amount in money terms of any orders for damages and interest made in favour of the claimant.
(2) Orders for costs made against a claimant may only be enforced after the proceedings have been concluded and the costs have been assessed or agreed.
(3) An order for costs which is enforced only to the extent permitted by paragraph (1) shall not be treated as an unsatisfied or outstanding judgment for the purposes of any court record.
The new amended rule is below:
Effect of qualified one-way costs shifting
(1) Subject to rules 44.15 and 44.16, orders for costs made against a claimant may be enforced without the permission of the court but only to the extent that the aggregate amount in money terms of such orders does not exceed the aggregate amount in money terms of any orders for damages or agreements to pay or settle a claim for, damages, costs and interest made in favour of the claimant.
(2) For the purposes of this Section, orders for costs include orders for costs deemed to have been made (either against the claimant of in favour of the claimant) as set out in rule 44.9.
(3) Orders for costs made against a claimant may only be enforced after the proceedings have been concluded and the costs have been assessed or agreed.
(4) Where enforcement is permitted against any order for costs made in favour of the claimant, rule 44.12 applies.
(5) An order for costs which is enforced only to the extent permitted by paragraph (1) shall not be treated as an unsatisfied or outstanding judgment for the purposes of any court record.
The updated regulations now enable defendants to recover costs up to the sum of any order, agreement, or settlement in favor of the claimant, including damages, costs, and interest. The rewording of CPR 44.14 implies that successful claimants are now at greater risk of incurring costs under Part 36 offers.
Furthermore, the defendant’s expenses can now be utilised to offset the claimant’s costs, leaving the claimant more susceptible to paying the remaining balance if their legal expenses exceed their costs award.
Consequently, these changes signify that claimants and their legal advisors must be more cautious while making interim applications, as there is an increased probability of adverse costs orders being enforced.
How can Greener Costs help?
If you have any queries surrounding the QOCS changes then please do not hesitate to contact us. Our team of Costs Draftsmen and Cost Lawyers have many years of experience surrounding costs drafting and negotiation. We are able to assist clients from all backgrounds on a range of cases, including clients that needed assistance with notice of discontinuance costs.
With our extensive knowledge and highly skilled team of Costs Draftsmen, we can provide law costing services to clients throughout England and Wales.
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