Fixed Recoverable Costs from 1 October 2023

Fixed Recoverable Costs (FRC) in litigation are specific amounts that are recoverable by a successful party from another party. In this context, "Costs" typically include solicitors fees, court fees, expert witness fees, barrister's fees, and certain other disbursements.

FRC will apply to most claims with a value up to £100,000 for legal proceedings issued at Court after 1 October 2023. The primary objectives behind this move are to streamline the recovery of legal costs, foster transparency, and bolster efficiency within the legal system. It stands imperative for all participants in legal proceedings to be well-informed when contemplating future litigation endeavours.

The FRC regime is principally outlined by the Civil Procedure Rule (CPR) 45, establishing that recoverable legal costs will be predetermined based on various case-specific parameters. Initially, the value of the claim will dictate the track to which the claim is assigned. Reforms have ushered in the intermediate track, strategically positioned between the fast and multi-tracks. The fast track caters to claims valued at £25,000 or less, while less intricate multi-track cases with values surpassing £25,000 but not exceeding £100,000 will be allocated to the intermediate track, subject to specific exceptions. Cases earmarked for the multi-track are exempt from the FRC extension.

Following the allocation to a specific track, the Court possesses discretionary authority to evaluate the claim's complexity on a case-by-case basis. The Court will assign each claim to one of four ascending complexity bands. The complexity bands associated with the fast track and intermediate track can be found in Table 2 within CPR 26.15 and CPR 26.16 respectively and detailed breakdowns of the fixed fees recoverable at the 15 different stages of litigation are detailed in Table 12 (Fast Track) and Table 14 (Intermediate Track) of Practice Direction 45.

It is important to note, whilst these detailed breakdowns are an indication of the FRC that could potentially be recovered, litigants will remain unaware of the particular band they're allocated to until proceedings are issued and a defence has been filed.