CHAPTER ONE – NEW RULES: WHAT IS CHANGING?
Current Position
To have a better understanding of the new rules that are coming into force regarding fixed recoverable costs (FRC), good practice would be to recap what the current rules are. For more detail, please see ‘A Practical Approach to Clinical Negligence’ (3rd Edition) 2023, Law Brief Publishing Ltd.
It is easy to say that each one of us should be familiar with the rules, however, when it comes to better understanding things that easily become a part of our habitual routine, one would be surprised how difficult it gets to explain something that is so natural to us.
Without going into too much detail, it might be enough to say that despite the FRC changes having made its way into certain personal injury areas, clinical negligence has not been affected by any of the FRC before October 2023 and so those who work in the field have been dealing with their cases as per usual. In very simple terms, the usual process is to record your work and then negotiate your costs at the end of each successful claim. Costs recovery is based upon that work being objectively proportionate and reasonable using the criteria set out at CPR 1998, Rule 44.3(5):
“(5) Costs incurred are proportionate if they bear a reasonable relationship to –
- The sums in issue in the proceedings;
- The value of any non-monetary relief in issue in the proceedings;
- The complexity of the litigation;
- Any additional work generated by the conduct of the paying party; and
- Any wider factors involved in the proceedings such as reputation or public importance.”
In the FRC regimes considered in this book, the amount of recoverable costs are set. If they apply to your case, then they are assumed to be proportionate and necessary. These 5 criteria only remain relevant for multi-track cases or in the very limited circumstances where additional amounts of costs are permitted in excess of the FRC amounts.
One of the important reasons why clinical negligence has not been caught by FRC until now is the complex nature of the cases that we (clinician negligence lawyers) are dealing with. This additional complexity is well-recognised. In Hobbs v Guy’s & St Thomas’ NHS Foundation Trust [2015] EWHC B20 (Costs), Master O’Hare said (at para. 35) that “Even in modest value clinical negligence claims it is necessary to incur costs … clinical negligence claims have more complexity and involve more work than do other claims of similar value.”
Citations such as this may still assist claimants’ lawyers in persuading the court to apply FRC in a just fashion thereby helping to retain some degree of access to justice. As we will see in Chapters 2 & 3, clinical negligence does not, as of right, attract higher FRC amounts than other types of civil litigation notwithstanding its recognised greater complexity.
Clinical negligence cases tend to require long hours of work being done and an impressive amount of disbursements being proportionately and reasonably incurred. And so, it has been previously recognised that it would be difficult to justify a fixed amount for the same in the way the new rules impose (see Chapters 2 & 3). This is particularly so taking into account that each case is very different, and it becomes rather difficult to predict whether any other case, even of similar nature, might end up costing the same. Again, herein lies a potential avenue to assisting the courts in applying these rules fairly and justly (please see Chapters 5, 6 & 10).
Those working on the defendants’ side will have their own arguments to make about costs related to clinical negligence claims and the proportionality of the same. However, this is an argument for another day (as this area develops). For now, we have provided assistance with what these might be based on our experience.
In this book, we shall discuss the actual changes that have been implemented for cases worth between £25,000 and £100,000, proposed for cases worth under £25,000 and how they will impact the existing rules which have been in place for clinical negligence lawyers for the years since the Civil Procedure Rules 1998 were introduced in April 1999. Many practitioners will have never known any other system.
Some of the changes influencing our new attitudes, behaviours and habits, however, have already been implemented earlier in 2023 to introduce new rules on costs recoverability for the defendants. The change relates to new QOCS rules affecting all cases issued on and after 6th April 2023 where pre-existing Part 36 offers had not been made by defendants. The new rules allow for any cost orders to be enforced against the claimant’s damages and costs, whereas before this was not realistic in practice.
As a result of the interplay with FRC, lawyers will need to be more careful when dealing with Part 36 offers. This includes providing much more structured advice to their clients about the risks and considering any offers more carefully. This is likely to impact on the recoverability of legal costs.
The FRC changes are further rules that initially came into force on 1st October 2023 and have an actual, measurable effect on the recoverability of legal costs. The rules are addressed to all civil claims and so, with some exceptions, to clinical negligence. This is considered further in Chapters 6 & 11.
The new rules are designed to expand FRC onto the claims higher in value and into new areas. There is a new intermediate track introduced to cover these cases that might no longer be suitable for the multi-track. The general thinking is that such unsuitable cases should not, just so that they can be dealt with under fixed costs, be transferred to the fast track. Therefore, as per new rules, all civil claims with value of up to £100,000 will be dealt with outside the multi-track, and so will be caught under FRC. With some exceptions applicable to clinical negligence cases, fewer of our cases will be caught up initially. However, currently from April 2024, introducing the light and standard track FRC for lower-value cases means that the majority of clinical negligence claims are likely to be infected with these reforms.
In the absence of suitable admissions, the majority of clinical negligence claims are likely to continue to be dealt with as multi-track claims post-issue, and so not caught by FRC. Nevertheless, there will be some exceptions and, currently from April 2024, pre-action FRC tracks apply to cases potentially valued at under £25,000. We will look at ways in which these rules might result in more clinical negligence cases being caught under these new rules too. Following that, our aim is to summarise the changes and explain their implications on clinical negligence.
This chapter will aim to summarise what the current rules are and what overall changes have been implemented. It is hoped that once this is clear, the next chapters will then explain in more detail the effects on clinical negligence claims and what we could do better in practice.
Implementation of New Rules
The first set of new rules on Fixed Recoverable Costs started to apply for cases where the cause of action arose on or after 1st October 2023.
Fast Track Claims
To remind ourselves, the fast track is very rarely appropriate for clinical negligence cases. It is the normal track for claims that meet the following criteria:
- value of the claim not higher than £25,000;
- the trial is likely to last for no longer than one day;
- oral expert evidence is limited to one expert per party in any expert field; and
- expert evidence is limited to two expert fields.
The majority of civil claims to date that fall under the fast track would be dealt with under FRC, and as per the new rules, all civil cases that will be dealt with under the fast track will be dealt with under the revised FRC rules.
You are right to think that most of the clinical negligence claims tend to be allocated to the multi-track regardless of their value. And so even if the case is allocated to the fast track, the parties would usually be able to demonstrate to the judge that the case should be allocated to the multi-track instead. That is usually associated with the complexity of each clinical negligence matter, and mostly for not meeting the criteria listed above.
It is anticipated that there will be little to add to the existing circumstances and so cases should continue to stay outside of the scope of this track and its rules. However, with further changes coming out related to low value clinical negligence claims in the near future, this might not stay the situation for long. The defendants might also start pushing for clinical negligence claims to meet the above criteria so that they could argue that the case is caught by FRC. As a result, unless one is sure that the case will not meet the above criteria, we should remain mindful about our costs.
Intermediate Track
Until 1st October 2023, any cases that were not suitable to be dealt with under the fast track (if the criteria above are not met, which was the case for the majority of clinical negligence claims) would be allocated to the multi-track.
However, according to new rules, there is now a new track that will cover all cases with a value of between £25,000 and £100,000. Instead of being allocated to the multi-track, they may end up in the intermediate track instead.
The intermediate track will be caught by the FRC regime, and so all cases that will be dealt with under this track will be caught by the new rules.
Once again, clinical negligence has been excluded from this track, unless certain criteria designed for clinical negligence claims are met. Therefore, most of the cases which would normally be allocated to the multi-track, will continue to be dealt with under the multi-track, with some exceptions.
Cases that fall under this exception are claims for clinical negligence where breach of duty and causation have been admitted. Following the CPR Committee November 2023 Minutes, these admissions should be made in the letter of response rather than later (i.e. before issuing proceedings or when the defence is served) for the intermediate track and FRC to apply.
For the claim to be allocated to the intermediate track, the case value would also need to be below £100,000, as otherwise it would proceed to be dealt with in multi-track due to its value.
There are some further nuances related to expert evidence and other criteria that we will discuss in this book. However, unless these criteria are met, clinical negligence cases are technically excluded from the intermediate track.
However, same as with fast track claims, the defendants might seek to implement different strategies and so not to be caught unawares at the end, it will remain our recommendation that we should stay cautious about the possible costs positions unless absolutely sure otherwise.
Multi-Track
The multi-track, has been the track that included all the claims where the value was below £25,000 where the case would not meet the criteria to be dealt with in fast track (most clinical negligence claims).
However, from now on, this would continue to cover only clinical negligence matters which in practice are not suitable for FRC tracks, and there is a risk that valuation issues become the major battleground where the value is not clearly above £100,000.
Therefore, it is expected that the majority of clinical negligence cases will initially continue to be allocated to the multi-track. This is because the criteria for the case to be allocated to intermediate track are not that easy to meet.
Nevertheless, as we should not expect that neither the system nor the defendants will make our job easy. We shall prepare for the worse and expect that some of our cases might end up in the FRC tracks and risk becoming unprofitable. Access to justice may reduce significantly. Accordingly, while it is good to stay optimistic, the message that we are trying to spread is that one should be prepared for the worse and remain careful about the cost consequences in this new era.
Tracks and FRC
The table below summarises whether FRC are going to be applicable based on the stage and then on the tract it is likely to be allocated to.
| Clinical Negligence Claims | ||
| Stages/Track | FRC Applicable? | Comments |
| Pre-Issue | Yes | Pre-Issued cases will be caught by the rules if in practice they would fall outside of the multi-track. This is particularly so once the <£25,000 FRC Standard & Light Tracks come into force. |
| Fast Track | Possibly | Clinical negligence claims will rarely be dealt with in fast track despite their value. However, if they are going to be, FRC are likely to apply. Our view is that the new rules do not preclude this. |
| Intermediate Track | Yes | Cases will be dealt with under this track. The main two things to note which will help to determine whether the claim will be caught are as follows:
a) case value is between £25K & 100K, and b) breach of duty and causation needs to be admitted. If the above criteria is met, review chapter related to cases in value between £25-100k for further exceptions. |
| Multi-Track | No | Cases where the value is above £100,000, and cases which are lower in value but liability has not been admitted in full will remain in multi-track.
Some lower value cases may also remain unsuitable for other tracks. Limited exclusions apply in any event. |
Things to Consider
The main concern will be all cases valued at less than £100,000. While not all cases that fall below £100,000 in value will be caught under FRC, these cases should receive specific treatment right at the start of the case in light of the new risks.
The fact that FRC can apply to both pre-litigated and post-litigated cases will result in different management to all cases that can potentially fall outside of the multi-track. All cases that will be treated as suitable for multi-track will be ‘protected’ from FRC and the usual rules will apply. Therefore, all those that are unclear/uncertain of being suitable for a multi-track should be treated with caution.
Cases where it is unclear whether these fall within the multi-track (and this situation might not be clear until later in the case), should be treated as being dealt with under FRC; anything else that can be recovered would be a bonus. Doing otherwise risks turning a strong case into an unprofitable one.
Working this way will require some adaptation, especially that some or even the majority of cases will remain to be dealt with under the standard rules. Nevertheless, one can only see this as an opportunity to be more reasonable with the time and costs spent on each case and the silver lining is that perhaps such methods will be adapted when dealing with higher value claims too.
The table below compares old rules and new rules when it comes to the implication of FRC.
| Old Rules | New Rules | ||||
| Stage | Track | FRC applies? | Conditions | FRC applies? | Conditions |
| Pre- Issue | – | No | – | Maybe | If the case, if issued, would be considered to fall outside of multi-track. |
| Post-Issue
|
Fast Track | Yes | Case will unlikely to end up in fast track | Yes | Case will unlikely to end up in fast track (subject to the new rules being clarified) |
| Intermediate track | – | – | Yes | The following criteria needs to be met:
a) case value is between £25 – 100K, and b) breach of duty and causation needs to be admitted. |
|
| Multi track | No | Most of the cases will end up in multi track. | No | –
|
|
| Summary | No fixed recoverable costs (FRC) implications in clinical negligence
|
Any case in value less than £100k should be treated as if it falls under the fixed costs, until it is clear that it does not. | |||
Pre-Issue
Even if some might have experience dealing under certain cost implications when it comes to litigated cases, this has never been the case with those dealt with pre-issue. While we of course have to stay reasonable and think about the proportionality etc. we still to date have not had to worry about any fixed costs.
Nevertheless, the situation has changed and FRC might kick in right at the start, even before we know it. This is because while the rules are clear that only an exceptional amount of cases that meet certain criteria would be dealt with outside of the multi-track, it will not be clear whether the case might fall outside of the multi-track until later.
While there are two main conditions that will need to be met (one regarding the case value and then another one regarding liability status), ambiguity persists and the case value might not mean that the case would automatically be considered outside of the multi-track or within the FRC tracks. The defendant’s position will usually not become clear until a letter of response is received, which is when a lot of proportionate and reasonable investigative work has already been done.
As a result, any cases that are potentially worth below £100,000 should be dealt with as they might fall within intermediate track in order to avoid any unpleasant surprises.
There can be strategic and tactical movements implemented, which we will touch base on in later chapters. However, regardless of anything else, we should ensure that we are aware of all of the potential costs implications in order to maximising the chances of benefitting from the situation irrespective of the outcome.
The table below summarises how high the risk is that the case might fall outside of the multi-track and so should be dealt with some caution.
| New Rules – Pre-Issued Cases | |||||
| Value £100,000 or below | Value above £100,000 | ||||
| Firstly, consider how confident you are regarding the case value being below £100,000.
If you are confident, proceed with considering below.
|
Firstly, consider how confident you are regarding the case value being above £100,000.
If you are confident that the value is much higher then potentially no need to consider anything else. If not confident, and/or case value/any future offers might be lower, then proceed with considering below. |
||||
| Defendant’s Position regarding Liability | Defendant’s Position regarding Liability | ||||
| Indication for an early admission | Remaining issues with Causation | Everything has been admitted | Indication for an early admission | Remaining issues with Causation | Everything has been admitted |
| High chance of being caught by FRC. | Low chance by being caught under FRC. | High chance of being caught by FRC. | High chance of being caught by FRC. | Low chance by being caught under FRC. | High chance of being caught by FRC. |
Post-Issue
When it comes to post-issued cases, the situation should be much clearer. The main reason is because full liability investigations would have already been undertaken and the defendant’s liability status would also be clear by this point.
Therefore, if the case meets the criteria of case value being below £100,000, and liability was admitted in full, then the case will most likely be allocated to the intermediate track. It appears that the intention is that only a very small minority of cases worth under £25,000 will be issued justifiably.
However, unless this criterion above applies, then one should be more confident of the case being allocated to the multi-track, but also more inspired to argue that it should be allocated to the multi-track if for whatever reason this has not been done so.
Practical Advice
We will attempt to cover any strategic actions that can be undertaken to protect both yourself and the client throughout the book. However, in a short summary, there are a few things that one might want to consider before we take a deeper look into the issues.
More than ever, we will need to start thinking about the rules and their implementation right at the start. This will involve us making a note of the following to determine whether the FRC costs can be applicable and to protect ourselves from any such severe costs that we might not receive:
- Key dates – as the rules will apply to call cases where the cause of action happened on or after 1st October 2023, it will be important to consider your limitation dates very carefully. Cases potentially worth under £25,000 should have suitable letters of claim (or notification) sent before 1st April 2024.
- Case value – while the case value is rather difficult to detriment at the start, we will need to be even more careful when trying to predict how much the case might be worth.
- Funding documents – ensure that the retainer/funding documents address this issue and an explanation is given to the client if the recovery of costs from the client is going to be sought in case the case falls under FRC.
We should also remain cautious of any changes to the case value as the case progresses, and/or any Part 36 offers due to both new QOCS rules and the change of case value if the lower offer is accepted etc.
Where possible, and where the signs suggest that this might be achieved, an indication of liability should be sought from the defendant as soon as possible. Even if no response is received, such attempts/communications should be recorded and could be used as evidence when it comes to the argument of the case being allocated to one track or another based on the defendant’s position.
Under the current rules it is not clear whether liability should be admitted at the earliest opportunity and/or pre-issue (subject to the CPR Committee’s proposals being implemented). However, if there are several attempts made (within the reason) to seek a clear confirmation regarding the defendant’s position, then one can more persuasively argue that an opportunity to make a full admission as per the relevant criteria has not been achieved within a timely manner.
Conclusion
We understand that there is a lot to take in, following which we will discuss each aspect in more detail in this book. The problem we see is that current rules have some gaps and it is not always clear what might happen in practice.
Therefore, and until we know better from letting the rules embed into the clinical negligence world first, we will try to prepare you for the worst first. Our approach is that unless you are 100% sure that the case is suitable for multi-track and multi-track only, then you should treat your case as benign caught by FRC. If at the end, you manage to get your full costs back, then we consider this to be the cherry on top.