Cost Lawyers Survey Reveals Onus Still on Solicitors to Get Savvy with Costs Budgeting Otherwise Trouble Ahead
A recent Association of Costs Lawyers (ACL) survey has demonstrated what we’ve been saying for a long time: that solicitors are in grave danger of self-inflicted financial liabilities if they cannot follow their costs budgets a little more closely.
The poll showed that only 5% of ACL members worked with lawyers who always stuck to their budgets. 67% said their solicitor clients “sometimes” went over budget, while 26% said this “always” happened.
A Court of Appeal ruling last month in Harrison v Coventry relayed that costs judge on detailed assessment should only depart from the approved or agreed budget if there is “good reason” to do so, meaning that the onus is firmly on the solicitor to be on target with their budget and furthermore to be continuously tweaking that budget as the case progresses. There’s appears to be no getting around this.
According to the survey, there has been some incremental progress with the number of applications to update a budget has increased from 18% to 23% in 6 months from November 2016 to May 2017.
Similarly, the number of costs lawyers who said they had never seen such an application fell from 32% to 27%.
The main criticism of the current system emanating from lawyers themselves is that in their minds the budgeting takes place too early on in proceedings, the survey revealed. 50% of survey participants believed the hearing should only take place once the path of litigation is clearer, whilst 29% felt staggered budgeting would be preferable
Overall, the number of costs lawyers who are feeling the benefit of the budgeting process has risen over the last year from 15% to 24%. However, a not significant 63% of lawyers agreed that it wholly depended on which judge (and court) was reviewing the case and that their approach and experience of costs budgeting was wildly inconsistent. Just 10% thought that judges knew what they were doing.
Interestingly, 42% said costs budgeting had forced them to hone their skills.
More change is expected with the new electronic bill of costs, which the Civil Procedure Rule Committee has decided will be implemented as compulsory in the Senior Courts Costs Office and county courts from April 2018, the survey reveals that half of participant solicitors had no idea this was coming.
There’s no doubt that solicitors will need to cease planting their heads in the sand as the inevitable digitization of certain legal processes is certainly not going to go away. In fact, it will become such a prevalent tool that the alternative will feel old-fashioned and archaic. Spreadsheet-fear is understandable but with efficient and user-friendly software available such as LHQ providing an end to end solution for budget creation, monitoring and alerting, and then finally the new electronic bill, the whole process can be streamlined, efficient and easy.