I don’t deal only with housing and landlord-and-tenant law, and so I’m interested by the recent changes in civil procedure, and in particular the new rules on cost management (which came in on 1.4.13) and on case management generally (which came in on 1.10.13), and I recently went to a very useful talk given by one of our local Midlands District Judges all about this.
We were told how cases that are allocated to the multi-track (generally those worth more than £25,000 or likely to last more than one day) have got to have their costs budgets agreed by the other side or approved by the DJ. The costs are then limited to the budgeted figures. And we were told how DJs are now taking a much more active role in managing cases, with major decisions on disclosure, witnesses, evidence and issues being decided by them at CMCs, which will now last much longer as a result.
The talk was fascinating, as much because of the insight into the way the local bench are thinking, the matters that bother them (poor court administration, shortage of staff, loss of files, delays in issuing paperwork) which are hardly any different from those of us on the other side of the table, as well as the guidance to the changes in the law (and in particular the CPR) itself. Time and again we were told that if the Judges are going to make sensible decisions on how to run the cases they need to have lots of information about what is at issue, how disputed matters can be decided and what evidence this will need, how long it is all going to take, and how much it is going to cost. If they don’t get these basics then the orders that they make are either going to be inappropriate, or, after having done this for a time and learned not to do things that afterwards turn out to be a bad idea, much more vague, general and really nothing which cannot be replaced by rules, as had been the case so many times in the past.
Now I’m not going to cover all the changes in this article. It’s a bit out of my normal area and there are many others who have covered it far better. And as the DJ told us, nobody knows how all this is going to work out in practice yet, and we need time, and a few decisions of the higher courts before it all beds down.
Also, I’m not going to moan that the courts are trying, yet again, to take the management of our clients’ cases out of our hands and run things themselves, although I might have done so. The older members of you might remember the Woolf reforms that resulted in the CPR in 1989, ending the Rules of the Supreme Court, and the County Court Rules, that had been around since the 1870s. Lord Woolf toured around the country gathering views from the profession before carving things into the stones, and he proposed much the same thing then. It didn’t work because the government wouldn’t give the courts enough money to pay for the extra judges and extra IT needed, and management became ineffective.
I went to one of his meetings in the Midlands and when it came to the questions after his speech I said to him that I, along with many of the other solicitors present, had spent many years building up a reputation in running litigation. Clients came to me because of this. If the litigation was going to be run by the DJs, who have largely left my profession because they didn’t like running litigation, how did he think this was going to be progress? As the clients would have no say in which of a number of DJs sitting in one court are going to manage their important cases they won’t even be able to vote with their feet. And I felt sure that a different DJ would deal with each separate application so there wouldn’t be any continuity. Many people agreed with me, and he really didn’t have an answer.
However, I think that the practical side of serious litigation has now become so awful that another attempt has to be made. A couple of years ago I was talking to the finance director of a medium-sized enterprise in the automotive business. He told me that he had recently become embroiled in litigation with one of his suppliers and was horrified at how things were going on (it wasn’t one of my cases). He had been involved in many projects throughout his career, and had recently moved his factory to brand new premises. In each case he and his colleagues made a plan, and set a budget, and a time-scale. Now these were not always entirely adhered to, and always contained provision for contingencies, but they were manageable, and he could plan the rest of his business around them.
Litigation just wasn’t like that. He was given a number of possibilities as to how his case would progress, a cost estimate that ranged from the improbably tiny to the outrageously huge, and a time scale that ranged from weeks to years. It all depended on what the other side did, and how the court responded. He had no control over it, and was deeply disturbed. He had no criticism of his lawyers, who were doing their best in impossible circumstances, but he couldn’t afford to continue despite having, on the evidence as he understood it, an excellent case, and was going to do a poor deal in order to avoid the uncertainty.
I had heard the same sort of thing many times, as most of us have, but never put quite so clearly. In his view, litigation ought to be a project like any other. It should be managed, budgeted and timed so that it works. OK there will be some uncertainties, but life is uncertain, and we seem to cope with that. The legal system just isn’t delivering on litigation and things will have to change. I wholeheartedly agree with him on this. And the new attempt at cost and case management looks like a valiant attempt to do the job, and it is worth supporting. We have tried solicitor-management of cases for many years and look where we are! If you are going to control cost then the courts will have to fix a price and the parties and their lawyers are going to have to work to it. If the court says that the costs are going to be £30,000 then you will have to get used to doing only that amount of work, and that extra expert, or the possible witness or the third conference with counsel will just have to be cut.
No, what I do want to cover is the matter of timing, and the work that will need to be done in the early stages of a case.
The whole management project is aimed at holding two major hearings for every case. The second of these will be the trial, as you would expect, although this will only be reached in a small minority of cases that don’t resolve before then. The first of these will be the new revamped and specially augmented Case Management Conference, which will plan the way in which the whole case will be handled, and in order for it to be effective it will have to be properly prepared for.
Now we are long used to preparing properly for the trial. We index and bundle and brief and file and realise that it is all needed if tedious. It is the end of the process in any event and most cases don’t get that far. There is a lot of time to do all this and the trial date gets fixed in stone some considerable time beforehand.
What is going to be a shock is doing this for the CMC, virtually at the beginning of the case. Not only will it be needed in nearly all cases that issue, as there is little time to settle at that stage, but there will be a lot of things to do in very little time.
The DJ will want the Claimant’s lawyers to produce a CMC bundle. In Birmingham (my local major trial centre) this will have to include
- Contact details of all lawyers and representatives
- Claim form
- Statements of Case
- Orders made (if any)
- Case Management Information Sheets (ie response to Directions Questionnaire)
- Disclosure Reports (DR)
- Electronic Disclosure Questionnaires (EDR)
- Estimates of costs of proposed experts with list of issues they will address
- Draft list of issues to be tried (DLI)
- Draft direction (incorporating all parties suggestions) (DD)
- Costs budget in Form H
Some of these are easy and obvious. But some are not – the DR and EDR can require considerable thought, the expert quotes may take some time, and the DLI and DD are clearly crucial and important. And enough has already been written about the costs budget to let you know that it is both crucial and complicated, with a lot of scope for messing things up.
All this is certainly achievable, and it will undoubtedly make the DJ’s task easier if it is properly complied with. But it will take a lot of work, and hence cost, in very little time, especially as some of the items such as the DR and EDR need to be served 14 days beforehand, and the whole bundle has to be filed 7 days beforehand. Especially as these items, plus the draft directions and Form H have to be discussed with the opponents as well, and consideration be given to their views.
Now looked at from the point of view of the Claimant this is manageable. They have 6 years (normally) to bring proceedings, and hence virtually as much time to prepare as they want, although this will all come at a cost to their clients. Full statements from the witnesses, lawyers crawling over the documents and quotes from experts once the issues have been extracted won’t come cheap. Counsel will very obviously be needed from considerably earlier than day one. All this cost will be lost if the exploration shows that there isn’t a case, or at any rate a sufficiently strong one. The days of the “suck it and see” claim look numbered.
If things get off the ground then all that ought to be needed is a tweak after hearing from the Defendants in response to the Protocol letter (before issue) and a further tweak, setting out the issues, after the Defence arrives and you’re nearly there.
From a Defendant’s point of view however things are much tighter. Defendants rarely go to their lawyers until they get the Protocol letter, or shortly before this. The letter will set things out is some but not extensive detail. There is then about a month (which might be extended) to respond, and as the lawyers will be starting from cold they will be vague, general and guarded, while they are trying to see their own witnesses, evaluate the documents, and working out what’s going on and what their best tactics will be. So unless serious negotiations get under way the Claimants are likely to conclude that they are wasting time and issue proceedings.
The Claim Form and Particulars of Claim give 4 weeks, extendible to 8 weeks to respond in a formal Defence. And serving the Defence triggers notice of the CMC, usually about 4-6 weeks away. Remember most of the documents have to be filed 1 or 2 weeks before this hearing, with discussions between the lawyers before this.
I’m not sure whether the intention is to hustle the parties into early settlement via say a formal mediation, but experience shows this to be most effective either very early on, before issue, when little cost has been incurred and the parties can factor the avoidance of future costs in to their calculations, or much later when all the evidence and documents have been disclosed and everybody can take a realistic view of their chances. Will forcing both parties to incur very substantial cost right at the beginning really help? I suppose it might just frighten them away from the courts entirely, but otherwise I have my doubts.
Now parties engaged in the largest litigation have always had to plan from the very beginning, and deal with the vast strategy that this involves. They realise that pre-issue costs can be valued in tens if not hundreds of thousands of pounds. But this is a system that is meant to handle all claims over about £25,000 – a substantial dispute with a supplier, a contested probate for a modest estate, a serious but not catastrophic injury. Even for a more substantial claim for £100,000 the cost is going to be really significant. Is this really the best way to manage things? Should perhaps there be some middle way? Or is this the only way to keep a lid on things, and people who can’t afford it should just stay away from the courts, if they can.
Only time will tell.