Loser takes all

They are calling it “The New Landscape”. Well, now, you can get new landscapes all sorts of ways. At worst, by an earthquake. On 26 April, the courts in England and Wales dumped the Rules of the Supreme Court and invented a completely new set called the Civil Procedure Rules. About 125 years of procedures and changed procedures and amended procedures plopped into a rubbish bin somewhere in the back yard at the High Court. The damn rules had become so well developed and argued-over that, far from becoming clearer and clearer, they had become so bloody clever as to fog everyone. They had reached the ultimate level of their own inefficiency. So, we have started all over again. Fresh field, new landscape – everyone is fogged.

At this point, I am very tempted to change my mind about what I want to talk about. There is an overwhelming urge to suggest we get that tatty old rubbish bin into one or two other backyards and dump all the other forms of building contract. We could easily ask whether 125 years of forms and more forms and more forms, having been amended, then changed, then amended, should be dumped.

Save it for another time. The reason is that the folk making the new landscape with the new Civil Procedure Rules are thinking about changing one of the new rules. It is called progress, which is where we were 125 years ago. The only difference this time is that those who do all this amending and altering must nowadays consult you. It’s not because they actually want your input. No, they invite comment knowing you won’t bother. So take them by surprise. Have a go. The reason is that what goes on in the courts is all about your business, your livelihood and your pocket.

One of the new ideas already in train is called “fast track”. This is for non-complex cases involving claims valued between £5000 and £15 000. There is a strict timetable of 30 weeks leading to a one-day trial. So far, so good. The shift comes with recovering your legal costs. It’s good news for losers and not so good for winners. What worries me is that I reckon that the latest ideas, if introduced, will favour the bloke with a bad case.

Let me explain. The ordinary rule is that “costs follow the event”. In simple cases, the event is easy to identify; it means the loser pays the winner’s legal costs. That is not so in fast-track one-day trials. The amount recovered for the trial itself is now capped. It is £350 or £500 or £750 if the award is £3000, £3000-£10 000 or more than £10 000 respectively. This applies regardless of the actual length of the trial within the one day.

What worries me is that I reckon that the latest ideas, if introduced, will favour the bloke with a bad case

Glibly, the Lord Chancellor’s department says “it should be possible for lawyers to work within the fixed costs allowed”. Of course that is right. It is quite possible to dash into court from a number 42 bus and shout from the court doors: “What a load of rubbish – don’t believe a word of the other fellah’s story!” then dash back on to the bus. These fixed costs are nothing more than a guess. The idea is half-baked. It will mean that the lawyer for the winner will charge his time to his client, but his client will only recover to the capped limits from the losing party.

But now the Lord Chancellor is thinking of going a step further. He is asking whether it is a good idea not just to have fixed recovery of trial costs but fixed recovery for the 30-week preparation, too. It’s another great idea for losers. Do you want this? If the preparation and the trial recovery costs are capped by way of recovery from the loser, is that OK? If you win your case and can’t recover all your solicitor’s reasonable costs, are you happy? Would it be a bright idea to limit what you pay to your solicitor to what is recovered from the loser? Yes, that’s smart.

Except, of course, that solicitors up and down the land will do with fast-track cases what many do with legal aid cases. They will say “no thanks”. And since construction cases and all those contract documents and all the building law cases have seen the development of highly specialised law firms, you would be a damn fool not to use those lawyers.