Important changes to the fixed recoverable costs regime
From 1 October 2023 important changes will take place to the fixed recoverable costs regime, which affects the costs that can be claimed by the winning party in civil litigation.
The changes introduce predetermined fixed costs that can be recovered by victorious parties, which, in most cases, will be lower than those currently available.
The recoverable costs will be based on the value of a claim with claims categorised as follows:
- Small claims up to £10,000.
- Fast track covering claims from £10,001 to £25,000.
- Intermediate track for claims of £25,001 to £100,000.
- Multi-track covering claims over £100,000.
What are the key changes to the recoverable costs regime?
The main change to look out for is the introduction of an intermediate track from 1 October 2023 for claims valued between £25,001 to £100,000. The intermediate track will remove less complex claims from the multi-track.
In addition, the court will allocate fast track and intermediate track claims to one of four complexity bands. The band assigned will determine the costs that are recoverable.
- There will be an unreasonable behaviour clause which can lead to costs being reduced or increased.
- If a claimant or witness is vulnerable, resulting in extra work (to the value of at least 20% of the fixed costs) being necessary, additional fixed costs can be awarded.
- Defendants can now recover the same fixed costs as claimants with some caveats to full recovery.
- Some changes are being made to Part 36 including claimants being entitled to additional costs equivalent to 35% rather than indemnity-based costs. It is hoped this will encourage early settlement.
Help with the fixed recoverable costs regime
Please don’t hesitate to get in touch if you need advice on the new fixed recoverable costs regime or any debt recovery matter, by emailing email@example.com or calling 0161 929 8494. Find out more about our services.