Costs budgeting to be extended to cases below £10 million in all courts

The current exceptions to the mandatory costs budgeting regime are set to be replaced by an exception for claims of over £10 million across all courts, following a recommendation by Lord Justice Richards, the Chair of the Civil Procedure Rule Committee (CPRC), and Lord Dyson, the Master of the Rolls. There will still be a discretion to apply the rules to cases over that threshold.  For cases below the threshold, costs budgeting will apply unless the court orders otherwise in an individual case.

This proposal was approved by the CPRC at its December meeting, but the papers have only been released this week. The rules and practice direction are to be formulated addressing how the limit should be applied and giving guidance on the exercise of discretion. It is not clear whether the change will be implemented along with the next round of CPR updates due to come into force on 1 April.

The new exception will replace the current exceptions which apply to all cases in the Commercial Court and claims of over £2 million in the Technology and Construction Court, Chancery Division and Mercantile Courts. A sub-committee of the CPRC was set up to advise on the issue last June and was due to report to the CPRC in October following a consultation over the summer, but it failed to reach agreement on the way forward.