The Proclaim Development team of Legal Practice Support (LPS) was tasked with automating the fixed costs process for a personal injury department, dealing in low value (below £25,000) claims in Road Traffic Accidents, Employer’s Liability and Occupier’s Liability claims.
What was the Issue?
At the point of instruction, on settling any case the file handler was required to manually prepare a fixed costs schedule based on the details provided in CPR 45, and also to manually insert the disbursements figures. Inevitably, in a fast-moving post-Jackson department which requires fee earners to be focussed on progressing cases, the last thing on fee earner’s minds was dealing with costs. This ultimately led to costly errors arising, including the failure to claim the correct fixed costs, to recover some disbursements, and in significant delay in costs being paid.
Cashflow is integral to any company, and therefore LPS was instructed to automate the fixed costs calculation and recovery process in order to streamline the process, and to minimise errors arising.
LPS developed a system whereby based on the clients damages and selection criteria on case conclusion, the fixed costs were automatically calculated and detailed in a costs schedule, and disclosed to the Defendant. Disbursements were standardised dependant upon the case type and correspondents utilised, so that a file handler would need to consciously ‘opt-out’ of attaching a relevant disbursement voucher and its corresponding details such as value and reference. The process was tied into the accounts system so that incurred disbursements not only automatically flagged within the cost schedule but it also provided an easy checklist for accounts to review along with the physical invoices and the relevant details all in one place.
On approval, the costs schedule was automatically disclosed to the ‘on-record’ paying party and the disbursement invoices were all automatically consolidated into a single document then attached to the cost schedule. If no response was received within specific timescales, the outstanding costs were automatically chased.
As a result of this process, the errors in claiming the correct level of fixed costs were eliminated, and the failure to recover all disbursements incurred was vastly reduced. This was without any significant change in fee earner behaviour and actually reduced the level of time spent by any individual on administrative costs work.
Extension of Process
With the extension of fixed costs proposed to extend to claims of up to £100,000 in the near future, now is the time to ensure your fixed costs processes are up to speed and accurate. Further extension of the process could incorporate links into the accounts system, to auto raise payments (to be approved) to third parties on receipt of settlement monies, or to feed into an enforcement process to ensure an application is lodged for failure by a paying party to raise funds in a timely fashion.
If you would like to discuss how to expand the automation of your fixed costs system, or to discuss general Proclaim development, please do not hesitate to contact email@example.com for further information.
Find Out More
James Denby is Head of Proclaim Development at Legal Practice Support and possesses in excess of eight years’ experience, both in-house and as an external consultant, in developing legal case management systems. James is also uniquely in the position of having worked as a Senior Manager within a law firm, and as having conducted his own caseload as an experienced Paralegal. As such James understands the requirements of any IT system/workflow/task from the view of the user, as well as from an IT perspective.Read More
I’m sure we are all aware by now of the outcome of Broadhurst v Tan and Taylor v Smith  EWCA Civ 94 (23 February 2016) in which indemnity costs were awarded for the Claimant having beaten their own Part 36 Offer on assessment. As a consequence, the Claimant was allowed to seek their costs from the date of expiry of the Part 36 basis on an hourly rate indemnity basis, thus trumping the fixed cost regime.
But what about the wider implications?
Jockey Club Racehorse Limited v Willmott Dixon Construction Limited  EWHC 167 (TCC) was a reminder that indemnity costs can and will be awarded for late acceptance of a Part 36 Offer. Which begs the question, are you utilising Part 36 Offer tactics to their full advantage? If so, then if you make a competitive Part 36 Offer and the Defendant accepts your offer out of time, there is merit in threatening to seek your costs on an indemnity basis, failing which an application to the Court can be made for the same.
Here at Legal Practice Support we can offer free advice on the issue and whether you are able to overcome the fixed cost hurdle. Further, if your case has prospects we are able to draft and negotiate the Bill of Costs prepared as a result. We provide both Claimant and Defendant legal cost drafting, negotiating and advocacy services. Based in Bolton, we are proud to offer nationwide paperless services to all our clients and a market leading three day working day turnaround on all costs work received. If you wish to seek our initial free advice on any matter, please do not hesitate to contact our Legal Costs Director on Robert.Collington@legalpracticesupport.co.uk or contact us here.