It has been in the pipeline for years but many practitioners have been firmly of the opinion that the new bill of costs would never become a reality. However the 92nd update to the CPR will have shattered the illusions of anyone still holding on to that hope. The new bill of costs is not just coming, it is technically here, and it will be compulsory for work done, in applicable cases, from 6 April 2018 onwards.
In his review of civil litigation costs, Jackson LJ had commented that the current bill of costs was not easy to digest, did not make use of available technology, conflicted with the budgeting process, and, perhaps most importantly to Jackson LJ, was expensive and cumbersome to prepare. His proposal to resolve this was for software to be developed which could be used for time recording and capturing the relevant information. This could then be used to automatically generate schedules or bills of costs, as well as providing the incurred costs for budgeting.
It has since been accepted that it is unlikely to be as simple as this as and that it is likely to be some considerable number of years before these documents can be prepared with nothing more than a touch of a button (if, indeed, it ever becomes a reality). However, it is certainly going to be the case that adopting the new J-Codes within time recording systems will help to produce bills of costs more quickly, more efficiently, and more cheaply. Whilst there has been no firm comment in this regard as yet, it is generally believed that as this system becomes commonplace, the costs of preparing a bill of costs will likely be awarded at assessment in line with the market rate for preparing a bill of costs from a time recording system which records J-Codes, rather than for preparing one from scratch.
So, what exactly are the J-Codes, and what do you need to know?
What is the new bill of costs?
The new bill of costs (Precedent S) is essentially an Excel format bill of costs which records the same information as you are used to in the current bill of costs, and much more. Jackson LJ's aim was that the Costs Judge would be able to drill down into the detail of the bill of costs as much, or as little as needed. A copy of the Precedent S can be found here.
Will the new bill of costs apply to me?
The answer to this question is almost certainly, yes.
The new bill of costs will need to be used for all Part 7 multi-track claims except for those where the proceedings are subject to fixed, or scale, costs; in which the receiving party is unrepresented; or where the Court has ordered otherwise.
The new bill of costs will be applicable to all inter-partes work from 6 April 2018.
What are the J-Codes and what can I do to implement these.
You will probably, by now, be used to allocating your time to a phase. Moving forwards you will need to take this a step further and also allocate it to a task, and to an activity. The J-Codes are the codes used to define the phase, activity, and task which is being undertaken, as well as disbursements.
For example, if you are discussing your client’s witness statement with them, the time would be allocated as follows: -
Phase – Witness statements [J-code JG100]
Task – Taking, preparing, and finalising witness statement(s) [J-code JG10]
Activity - Communicate (with client) [J-code JG106]
Paragon Costs have been keeping up with the development of the new bill of costs and are as prepared as we can be. If you want any further advice in relation to the new bill of costs and J-codes, any in-house training to look in further detail at the new bill, or any advice on steps that you can take to prepare for the coming changes, don’t hesitate to contact Lucy Baldwin.