Cost Budgeting does not Replace Detailed Assessment


12 December, 2016

Merrix v Heart of England NHS Foundation Trust (2016) QBD (Birmingham) (District Judge Lumb) 13/10/2016

The court was asked to determine the extent to which the costs budgeting regime fettered a costs judge's powers and discretion at a detailed assessment.

The claimant receiving party submitted that if her costs were claimed at or less than the figure approved or agreed for the relevant phase of the costs budget, they should be assessed as claimed without further consideration.

The Judge disagreed concluding that a costs judge's powers on detailed assessment were not fettered by the costs budgeting regime, save that the budgeted figures should not be exceeded unless good reason could be shown. It was clearly the intention that costs budgeting was not to replace detailed assessment. That was shown by the fact that there had been no significant changes to CPR Pt 44 and Pt 47 when costs budgeting was introduced. The receiving party's last agreed or approved budget was just another factor the court would have regard to.

Forbes comment

Whilst cost budgeting was not intended to replace detailed assessment, it is expected that parties should be able to produce a collaborative budget that is sufficiently accurate that the difference between the parties at the end of the case is negligible and a detailed assessment is therefore rendered unnecessary. Whilst this is perhaps an idealistic view of the process, it is illustrative of the approach that judges will adopt in budgeted cases.

The Court has granted permission to appeal this issue. We will advise you of the outcome in due course.


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