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Settling for Less?

View profile for Nick Stockley
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Lord Justice Jackson is to lead a new review of fixed recoverable costs the HM Judiciary has announced. The review is to consider whether, in civil litigation cases up to £250,000, the winning party should be awarded more than a fixed and prescribed amount towards their legal costs. The current  rule is that if the claim value exceeds £10,000 then the winning party will, generally, be entitled to recovery of the legal costs that they incur but this is set to change.  

If the new fixed cost regime comes into force, a party may sue for £75,000 in a relatively complicated case, incur legal costs to win a case only to find that the Court awards the winner a small fraction of the legal costs that they incur in order to win.

If this new change comes to pass then parties will, inevitably, be forced to consider settlement rather than go to trial. Why go to trial if you stand no chance of recovering all of your legal costs? Should parties be forced to settle on grounds which are unrelated to the merits of their case?  It seems that disputing parties may be forced away from the Court rather than given access to it.

 

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