Fixed Costs Are Here at Last

The Civil Procedure Rules
As of 6 October 2003, any cases involving road traffic accidents having the value of £10000 or less that settle without issue of proceedings will be subject to fixed fees. These fees are set out in part 45.7 to part 45.14 of the 1998 Civil Procedure Rules (CPR).

The scheme will apply to all accidents that occur on or after 6 October 2003 (25A)PD.

The scheme provides a basic payment and a mark-up graded up to £10000.

Basic payment £800.00
£0 - £5000 20%
£5000 - £10000 15%


For example, a claim settled for £6500 will enable the claimant to recover fixed fees as follows.

Basic payment £800.00
20% of £5000 £1000.00
15% of £1500 £225.00
Total £2025.00


The rules also provide for a mark-up for claimants living in London and whose claims are handled by a London solicitor. London claimants will be entitled to a mark-up of 12.5%.

Thus a London claimant settling a claim for £6500 will recover the following.

Fixed fees as above £2025.00
12.5% of £2025 £253.13
Total £2278.13


Disbursements
The rules provide that the claimant will be entitled to recover disbursements in addition to the fixed fees.

Can the claimant contract out of the fixed fee regime?
A claimant wishing to recover an amount greater than the fixed figure can apply to the court for costs to be assessed.

The claimant will have to show that the case is exceptional and at the same time will have to give an indication of the amount of costs they seek to recover. If defendant or insurer wishes to challenge the assessment process, they must specify in the acknowledgement of service.

The court will then determine the issue. If it agrees with the claimant it will assess the costs or make an order for costs. If it considers the claim inappropriate, fixed costs will be recoverable instead.

Penalties for going through this process
If the costs are assessed as 20% greater than the figure prescribed, the defendant or insurer will have to pay the cost of the assessment.

If the costs assessed are less than 20% greater than the fixed costs, the defendant or insurer can pay the lower of the two figures, i.e. assessed costs or fixed costs, and the claimant will have to bear the cost of the assessment.

While this regime does not apply to the Trenwick cases we hope that the above figures will be of assistance to you. These formulas can be used when dealing with a claimant’s claim for costs on non RTA matters as an indicator of what would be reasonable recoverable costs. These are after all figures that were recommended and approved by Association of Personal Injury Lawyers (APIL).