There is a detailed exposition of the principles relating to costs budgeting in the judgment of Mrs Justice Joanna Smith in Various Sam Borrowers v BOS (Shared Appreciation Mortgages) No. 1 Plc & Ors [2022] EWHC 2594 (Ch).  The judgment contains an interesting commentary on the principles relating to budgeting; proportionality, counsel’s fees, the expert phase and the costs of trial.  The judge was considering a budget of £7,748.831.10.


“… I do not consider it reasonable or proportionate, having regard to the complexity of the litigation, for the Claimants to be exposed to such a high figure for trial preparation. The reason it is so high appears to be down to the fees of counsel. I also do not consider that my earlier observations about the value of the overall claim affects this position. I have identified factors which cut both ways but, even assuming that it is correct to consider the costs of this phase by reference to their relationship with the potential value of the 161 claims, I remain of the view that they cannot be justified having regard to the complexity of the exercise required in the trial prep phase.”


The claimants brought actions alleging the mis-selling of shared appreciation mortgages.   There were 50 claimants and 15 lead claims had been selected to go trial and which were the subject of costs budgeting.  The judge was sitting as a judge of the County Court and had to budget the remaining phases of the budget.


The matter had been subject to budgeting for earlier phases.

  1. At the first costs management conference on 19 January 2022, the court made a costs management order for the Claimants in the sum of £509,635 and for the Defendants in the sum of £646,375. The court also recorded pursuant to CPR r.3.15(4) that the Defendants’ costs of £228,665.50 incurred in relation to CMC1 were disproportionate and unreasonable in amount, and would have been subject to reduction by the court had they not already been incurred. The total amount of the budgets at this point (including incurred costs) stood at £1,661,094.02 (for the Claimants) and £2,698,913.30 (for the Defendants).


The claimants’ budget was largely agreed. The defendants filed an initial budget of £8,323.831 and then revised this downwards to £7,748.831.10.  This was not agreed by the claimants.


7. In September 2022, the parties exchanged Precedent H budgets for the next phase of costs budgeting (which include their approved budgets for Phase 1). Precedent R Budget Discussion Reports were exchanged on 21 September 2022.
The Claimants’ Budget
    1. The Claimants’ Precedent H costs budget, including its Phase 1 budget, totals £4,272,512.36. With the exception of a proposed contingency for a specific disclosure application of £132,346.00, included as Contingency A in the Claimants’ budget, their budget has been agreed by the Defendants (albeit not without the suggestion that it may reflect an under-estimate of the work required to trial). On any view, the Claimants’ budget appears to me to represent a very substantial legal spend for a 24 day trial.
    1. In any event, pursuant to CPR 3.15(2)(a), I record that the Claimants’ budget (with the exception of Contingency A, to which I shall return at the end of this judgment) has been agreed. During the course of the hearing, it was further agreed that an additional sum would be added to the Claimants’ budget for ADR. I shall return to this in a moment.
The Defendants’ Costs Budget
    1. The Defendants’ total costs budget, including their Phase 1 budget, as advanced in a Precedent H budget dated 6 September 2022, totalled £8,323,831.00 (“the First Budget“), nearly twice that of the Claimants’ budget. This was subsequently amended by a second Precedent H budget served on 21 September 2022 which revised the total budget to £7,748,831.10 (of which incurred costs amount to £2,124,721.00 and estimated costs amount to £5,624,110.00) (“the Second Budget“). Estimated costs under the Second Budget therefore substantially outstrip the totality of the Claimants’ budget.
    1. The revisions in the Second Budget came too late to be addressed in the Claimants’ Precedent R Discussion Report, which objected to the vast majority of the sums in the First Budget on the grounds that they were both unreasonable and disproportionate. Very much reduced offers were made by the Claimants in respect of the Defendants’ budgeted costs, in many cases designed to reflect the figures that they had themselves included in their costs budget for particular individual phases of the litigation.
  1. The revisions included in the Second Budget have made no difference to the Claimants’ position. They continue to object in the strongest terms to the figures put forward by the Defendants in the Second Budget. Indeed, their objections appear to have precipitated an open offer on 27 September 2022 from the Defendants (“the Offer”) (designed, as it makes clear, to try to seek agreement on budgets), to accept a yet further reduction to their budget of £937,090.00 (achieved by offering not to seek budget approval in respect of the third member of their counsel team and by applying a reduction of 10% across the board to the estimated amounts in each phase).
The judge set out the relevant principles relating to budgeting.
    1. The court’s cost management powers as set forth in CPR 3 and Practice Direction 3E are well known. However, I should identify the key principles, together with some helpful guidance in recent cases to which my attention was drawn by the parties:
i) Where budgeted costs are agreed between the parties, the court can do no more than record that agreement (CPR 3.15(2)(a)). However, where the court has reservations as to the agreed figures on grounds of reasonableness and proportionality, it may record its comments to that effect (see WB, Vol 1 at 3.15.4).
ii) Where budget phases are not agreed, the court will review them and record its approval after making appropriate revisions (CPR 3.15(2)(b)).
iii) The court will limit its approval in respect of the budgeted costs of each phase to those which are both reasonable and proportionate (PD3E at paragraphs 5 and 12).
iv) In deciding the reasonable and proportionate costs of each phase of the budget, the court will have regard to the factors set out in CPR 44.3(5) and 44.4(3) (PD3E at paragraph 5). Pursuant to CPR 44.3(5), costs incurred are proportionate if they bear a reasonable relationship to (amongst other things, and focussing on the factors identified by the parties as relevant in this case): (i) the sums in issue in the proceedings; (ii) the complexity of the litigation; and (iii) any wider factors involved in the proceedings such as reputation or public importance. Pursuant to CPR 44.4(3), the court will have regard to various additional factors, many of which overlap with those in CPR 44.3(5). Neither of the parties to this application focussed on any additional factors in CPR 44.4(3), although I note that one factor that does require the court’s attention is “the receiving party’s last approved or agreed budget”.
v) When reviewing budgeted costs, the court will not undertake a detailed assessment in advance, but rather will consider whether the budgeted costs fall within the range of reasonable and proportionate costs (PD3E at paragraph 12). See also Various Claimants v Scott Fowler Solicitors [2018] EWHC 1891 (Ch), per Chief Master Marsh at [16]: “I emphasise that the court is not required to have regard to the constituent elements of each budget phase (it may do so) and the court’s task is to decide whether the total for each phase falls within a range of reasonable and proportionate costs”. See also Yeo v Times Newspapers Ltd [2015] EWHC 209 (QB) per Warby J, as he then was, at [66]. What is reasonable and proportionate in this context must be viewed objectively.
vi) The court’s task is not to carry out a calculation or strict arithmetical exercise. Reasonableness may involve having close regard to the calculations in the budget, but proportionality does not (Various Claimants v Scott Fowler Solicitors [2018] EWHC 1891 (Ch) at [16]).
vii) A comparison between budgets may be informative but it can never be determinative; “the court is not a slave to comparison” (Various Claimants v Scott Fowler Solicitors [2018] EWHC 1891 (Ch), at [17]). Similar work in the hands of different legal teams may result in different costs. That is why, if they are to be approved by the court, a party’s costs need only fall within a range. Thus the “touchstone” need not be the lowest amount a party could reasonably be expected to spend: “the court should allow some flexibility to the parties to ensure that their conduct of the action is not unnecessarily and potentially unfairly hampered by an unrealistically low assessment or by only the lowest assessment of what would constitute reasonable and proportionate expenditure” (see Discovery Land Company v Axis Specialty Europe [2021] EWHC 2146 (Comm) per Peter MacDonald Eggers KC sitting as a Deputy High Court Judge at [18]).
viii) Whilst it is helpful to have an eye on the overall budgeted figure, that is not the focus of the task set for the court – PD3E paragraph 5 is expressly concerned with the reasonable and proportionate costs of “each phase”.
ix) The future (i.e. estimated costs) element of the costs budget is binding on a subsequent detailed assessment and the figure for those costs should not be departed from on assessment (whether upwards or downwards) unless a “good reason” can be shown (CPR 3.18 and Harrison v University Hospitals NHS Trust [2017] 1 WLR 4456). Accordingly, decisions made by the court at the costs management stage are both significant and important.


The defendants’ counsels fees for junior counsel alone exceeded the total costs of counsel in the claimants’ budget.  The defendants’ fees were described as “stratospheric” by the claimant and “aspirational” by the judge.

    1. Although the court is concerned with considering the total budget for each individual phase, a key area of contention between the parties at this hearing concerned the size of the Defendants’ counsels’ fees, particularly in the expert, trial prep and trial phases of the litigation, which Mr Burton described as “stratospheric“. Indeed it was the level of these fees and their impact on the size of the Defendants’ budget for these individual phases and thus on the size of the Defendants’ overall budget, which really lay at the heart of the dispute between the parties at this hearing.
    1. I have already observed that similar work in the hands of different legal teams may result in different costs and that can obviously be for a variety of reasons. It may be down to differently constituted teams of lawyers, the location from which those lawyers are operating, the differing expectations and needs of the client and different (entirely legitimate) views as to the volume of work that will need to be undertaken in any given phase in order properly to conduct the litigation. If reasons of this sort account for a discrepancy in budgets between parties to the same litigation, then it may well be that those budgets will fall within a reasonable range. However, whilst a party is of course entitled to spend whatever it wishes in purchasing a “Rolls Royce” service with no expense spared, it cannot expect to recover its costs (over and above that which it would have been reasonable and proportionate to spend) from the other party if it is unsuccessful at trial.
    1. Mr Burton drew my attention to the recent decision of Deputy Master Campbell in Hankin v Barrington [2022] 1 WLUK 6 (QB) in dealing with a dispute over the fees of counsel on a detailed assessment. In that case, the Deputy Master referred (at [20(i)] to an observation made by Pennycuick J in Simpsons Motor Sales (London) Ltd v Hendon Corporation (No2) [1964] Costs LR (Core) 29 to the effect that “…one must envisage a hypothetical counsel capable of conducting the particular case effectively but unable or unwilling to insist on the particular high fee sometimes demanded by counsel of pre-eminent reputation. Then one must estimate what fee this hypothetical character would be content to take on the brief…”. Mr Burton submitted that this was the approach I should take to the counsel fees in this case and he pointed to the Deputy Master’s decision to reduce the brief fee of leading counsel in a complex clinical negligence matter for a 13 day trial from £110,000 to £75,000.
  1. I should say at once that I do not consider that I gain any assistance from Hankin as to what may be the appropriate level of brief fees in what is, plainly, an entirely different case. Furthermore, it seems to me that I must take care before simply rejecting the Defendants’ budgeted figures on the grounds that they include the fees of a “pre-eminent” team of three counsel. That is not the question for the court. On the contrary, my only task is to arrive at a total figure per phase that is reasonable and proportionate having regard to the relevant considerations identified above. It may be that the court arrives at the conclusion that the impact of a party’s choice of counsel in fact renders the overall figure arrived at in any particular phase unreasonable or disproportionate and that in arriving at that decision, the court will look in a granular way at (amongst other things) how those fees are made up. However, as Chief Master Marsh said in Various Claimants v Scott Fowler Solicitors at [16], “…the court is not bound by a party’s choice of representative in the sense that a party is entitled to choose an expensive law firm and/or be represented by leading and junior counsel. The court makes no judgment about such choices. It is only interested in whether the total figure per phase is reasonable and proportionate”.



There was some discussion about proportionality.   The judge held that there were some complex issues here.  Further the question of the value of the claim had to be looked at in the context of all the claims being brought,  not just the 15 test claimants.

    1. Furthermore a glance at the Case Summary and List of Issues proposed for trial, as prepared by the Defendants’ solicitors, reveals a four page case summary and the statement that “in broad terms” there are 3 issues for trial: (i) whether the relationship between each Claimant and the applicable Defendant is unfair within the meaning of section 140A of the 1974 Act; (ii) if so, what relief should be granted; and (iii) in respect of SAMs redeemed more than 6 years before the issue of the claim form, whether those claims are time-barred. Of course there are specific issues to be considered by the experts, as identified in the Order of 22 June 2022, but these issues do not appear to me to be particularly burdensome, unusual or “heavy” in the context of a claim of this sort.
    1. Furthermore, the question of the relationship between the complexity of the case, such as it may be, and the budgeted costs must be considered primarily having regard to the costs of a particular phase, a point to which I shall return when considering each phase in turn. In their submissions, the parties tended to focus on the overall value of the claim rather than considering the extent to which the costs of any particular phase could be justified by the complexity or volume of the work required in that phase.
    1. As for the sums in issue in the proceedings, on careful reflection, I think it would be artificial to ignore the fact that the rationale for managing the case with a view to identifying only a limited number of claimants to take part as Lead Claimants at the trial was to avoid the need for an unmanageable, extremely lengthy and prohibitively expensive trial of all of the claims. It is plain that all parties recognised and endorsed this aim from the outset. Whilst there may be a danger, as Mr Burton contends, of the Defendants refusing to arrive at a speedy compromise on all remaining claims in the event of defeat at the trial of the Lead Claims, such that some additional costs may need to be spent before all claims can be resolved, nevertheless it seems to me that I must have regard to the fact that the stated ambition of both parties is to fight the trial in respect of Lead Claims which cover a broad range of the characteristics which arise across the claimant pool, thereby facilitating a final resolution of all 161 claims.
  1. If the Defendants are unsuccessful in that trial, their ultimate exposure will therefore be to the circa £50 million claimed by the totality of Claimants, rather than merely the £7.3 million claimed by the 15 Lead Claimants. Accordingly it would be unfair and unrealistic not to take this exposure (and the Defendants’ understandable desire to manage the litigation with a view to ensuring the best possible chance of limiting their exposure in so far as possible) into account in considering the question of proportionality. In my judgment, therefore, a straightforward comparison between the value of the Lead Claims and the Defendants’ budget is unlikely to be particularly helpful. As Mr Burton ultimately accepted, there is an obvious “ancillary benefit” to litigating the Lead Claims. Equally, however, I must bear in mind that one of the aims of litigating the Lead Claims alone is plainly to avoid disproportionate expenditure on all claims (including disproportionate expenditure in dealing with phases of the litigation).
    1. However, in this case, as I have already remarked, it seems to me that the Claimants’ budget is in fact a sizeable budget involving the anticipated expenditure of substantial sums. I have seen nothing that leads me to suppose that the Claimants’ budget is particularly depressed or that, as Mr Duffy submitted, it under-estimates the cost of any particular phases of the litigation. Whilst a straightforward comparison between the Claimants’ and the Defendants’ budgets would not be appropriate, nevertheless I consider that the agreed figures in the Claimants’ budget provide a useful starting point for consideration of the range of figures within which the Defendants must fall if their budget is to be both reasonable and proportionate.


The judge considered an argument that the impact of VAT was relevant to the question of proportionality. The argument was not accepted.

  1. Finally, Mr Burton submitted that I must have regard to the fact that all the figures in the Defendants’ budget are exclusive of VAT and that, accordingly, it is only fair to the Claimants that, when considering the issue of proportionality, the court should add a 20% premium to the figures. I reject that submission. There is nothing in CPR 3, or PD3E to support such an approach and the standard Precedent H forms expressly exclude VAT (if applicable). The focus for the court is on what it is reasonable and proportionate for a party to spend on the litigation and there is no justification, in my judgment, for taking account of VAT in considering proportionality.


The defendants sought £690,000 in relation to the expert phase. However it had not obtained direct quotations from experts and could not identify specific experts and their fees.

    1. The Defendants’ estimate for the costs of their expert reports has reduced very substantially since their First Budget (which, amongst other things, estimated its expert fees at £420,000, including £100,000 for its expert in residential mortgages and £300,000 for its economics expert). The total estimate for this phase in the First Budget (excluding incurred costs of £27,737.60) was £815,200 – a figure now reduced to £690,200 in the Second Budget, a reduction which I infer (and which was confirmed by Mr Duffy, at least in respect of the fees of the economics expert) represents an acknowledgement that the First Budget was neither reasonable nor proportionate.
    1. The Offer reduces this figure still further to £571,680 (albeit that Mr Duffy maintained, for the purposes of this hearing, that the figure in the Second Budget remained a reasonable and proportionate figure). By contrast, the Claimants’ agreed estimate for expert reports (excluding incurred costs of £44,000 odd) is £379,361.50. They have made an offer to agree a figure of £423,782.84.
    1. There is little doubt that expert evidence is likely to be of the utmost importance in the context of the issues in this trial, and in the circumstances, I cannot conclude that the estimated spend on behalf of the Defendants as set out in their Second Budget is obviously disproportionate having regard to the potential for this trial to resolve claims worth in excess of £50 million. However, as I have said, proportionality is not to be assessed solely by reference to the relationship of the costs to the overall value of the claim. Costs will only be proportionate if they also bear a reasonable relationship to (amongst other things) the complexity of the phase of the litigation in which they occur.
    1. Where both sides must instruct experts to deal with exactly the same issues (and indeed where one of the experts is in any event a single joint expert) I consider it to be entirely legitimate to take the Claimants’ agreed estimate (which is nearly half of the Defendants’ Second Budget figure) as a starting point. In particular I consider it to be reasonable to regard the Claimants’ agreed estimate as an indicator of a sum which bears a reasonable relationship to the complexity of this phase. In this case, the Claimants have expressly identified their residential mortgage and economics experts by name, thereby providing comfort that the fees they have set out in their budget are realistic and achievable in the market.
    1. The difference between the Claimants’ figure for this phase and the Defendants’ figure is accounted for by: (i) the Defendants’ estimate that they will spend 772 solicitor hours in dealing with the experts (as opposed to approximately 500 hours to be spent by the Claimants’ solicitors); (ii) counsel fees of £185,000 (as opposed to fees of approximately £55,000 on the part of the Claimants’ counsel) and (iii) expert fees of £270,000 (as opposed to fees of £152,500 for the Claimants’ experts). Having regard to the size of the discrepancy across all elements of this phase, I consider that the Defendants’ Second Budget is both unreasonably high and disproportionate.
    1. I cannot see the justification for so much legal time to be spent dealing with expert reports. Whilst solicitors will obviously be involved in instructing the experts, preparing bundles for them and liaising with them, as well as attending meetings with counsel and reviewing draft reports, 772 hours of time appears to me to be excessive; the issues to be addressed by the experts have already been identified by the court in its Order of 22 June 2022 and one of the experts is a single joint expert whose remit is limited to valuing the mortgaged properties for unredeemed SAMs relevant to the Lead Claims. I do not therefore consider that the complexity of the expert issues justifies the amount of time that the Defendants’ solicitors intend to spend.
    1. The counsel spend is equally unreasonable in my judgment, involving three counsel spending between 50 and 80 hours each in dealing with expert issues; to my mind an unnecessary duplication of work. If the Defendants wish to instruct three counsel to deal with expert issues then that is a matter for them, but the additional fees that the instruction of three counsel add to the overall figure for this phase are unreasonable (and I note in this context that the Offer strips out the fees of the third counsel).
    1. Turning to the fees of the experts, it seems to me to be regrettable that the Defendants have not seen fit to provide information in their Second Budget as to how the very substantial figures identified have been arrived at. The reduction in fees for the economics expert from £300,000 in the First Budget to £150,000 in the Second Budget is wholly unexplained and there is no suggestion in either budget that these figures have been derived from quotations obtained in the market. Mr Duffy tells me that the original figure of £300,000 for an economics expert was based on a quotation which (after further research) it is now accepted to have been unreasonable. The revised figure of £150,000 is apparently based on an assessment of a range of quotations, albeit that the Defendants have not yet made a decision as to the identity of their economics expert.
    1. In the absence of a clear explanation in the Defendants’ Precedent H for substantial expert fees, the court has no assistance on the question of whether those fees are reasonable and proportionate and (where they are far in excess of the fees identified by the other party) is far more likely, in my judgment, to arrive at the conclusion that they are neither.
    1. Mr Duffy argued that the Claimants’ budget under-estimates the extent of the task to be done in relation to the experts and/or that it takes account of the fact that the Claimants’ team already has familiarity with the expert issues at stake by reason of the involvement of (at least) their counsel and residential mortgages expert in another similar piece of litigation. This was disputed by Mr Burton who pointed out that the Defendants created the SAMs products and so are inevitably more familiar with them than the Claimants. I am not in a position to determine this point one way or the other. However, even assuming that Mr Duffy is correct, I cannot see that a reasonable range would nevertheless extend to figures that are nearly twice as much as the Claimants’ figures.
  1. Having regard to all of the points made above and taking what can only be a relatively broad-brush approach, I am prepared to approve the Defendants’ expert budget at the level of £500,000, which seems to me to be at the very upper end of any reasonable and proportionate range.


The trial preparation phase led to the detailed consideration of the discrepancy in counsel’s fees. £2,462,200 was sought by the defendant. £1.2 million was allowed.
    1. In their Second Budget, the Defendants identify their estimated costs of the trial prep phase of the litigation at £2,462,200, a figure that assumes the Claimants will be responsible for the trial bundles and that there will be an electronic bundle (50% of the cost of the electronic bundle, estimated at £75,000, having been included in the total figure). In the Offer, the Defendants revised this phase to £2,013,480 by removing the fees for their third counsel and applying an additional 10% reduction. However, even the figure put forward in the Offer remains approximately twice as much as the Claimants’ agreed estimate of £1,098,150.
    1. The key constituent elements of this phase are (i) 920 hours of solicitor work and (ii) brief fees amounting to a total of £2,100,000. These include a brief fee for leading counsel of £1,250,000 together with brief fees for the two junior counsel of £225,000 and £625,000 respectively. The latter fee of £625,000 for junior counsel is exactly the same as the fees of leading and junior counsel for the Claimants combined, which the Claimants make clear in their budget are based on an assumed period for trial preparation of 7 weeks.
    1. Whilst the solicitor hours estimated in this phase and the cost of those hours does not appear unreasonable (not least when compared with the higher figures in the Claimants’ budget), in my judgment the very substantial fees identified in respect of counsel plainly have the effect of rendering the overall estimate for this phase both unreasonable and disproportionate having regard to the issues at stake in the litigation and their complexity. No information has been provided as to how brief fees have been arrived at and indeed it was not until the hearing that the Claimants and the court were informed that those fees were based on an assumed 14 week period of preparation for a 24 day trial.
    1. I can do no better in this context than quote again from the judgment of Chief Master Marsh in Various Claimants v Scott Fowler Solicitors at [27]:
“Inevitably, in the absence of a cogent explanation for a substantial brief fee, the court is likely to conclude that the estimate is aspirational. I consider it is essential, if the court is to undertake costs management in accordance with the Rule and Practice Direction, either for the assumptions in a budget to explain how counsel’s fees for the trial have been estimated or for this information to be provided with the budget in a covering letter”.
    1. Mr Burton submitted that a fair rule of thumb is that trial preparation will take roughly the same amount of time as the trial itself. This is a rule of thumb with which I am familiar but it is inevitably a somewhat rough and ready approach which cannot be slavishly applied across the board (and has in fact been deviated from by the Claimants themselves). There may be cases where its application will significantly under-estimate the time needed to prepare for trial (perhaps because of the complexity of the issues involved or the recent involvement of new counsel); equally there may be cases where its application would be too generous (perhaps because the case involves numerous defending parties and agreement has been reached between defending counsel to share the burden of the work). Yet further it may be important to bear in mind that a “heavy” trial will command a substantial booking fee, recognition of the fact that counsel may have turned away other lucrative work in order to devote herself to the case in hand. What is important, it seems to me, is that there should be a coherent explanation for trial preparation time that (as in this case) far exceeds the normal rule of thumb.
    1. Regrettably, that has not occurred here and whilst I now know that the Defendants’ brief fees are based on 14 weeks’ preparation, I find it very difficult to see why a trial of this sort requires a preparation time of more than twice the length of the trial itself. The following points immediately occur to me:
i) On the face of things, the involvement of two juniors, including a specialist in consumer law (who I am told will be instructed regardless of whether his fees are recoverable in the budget), ought to relieve leading counsel of considerable amounts of preparation time – certainly in relation to opening submissions.
ii) In considering the time it may take to prepare the cross-examination of the 15 Lead Claimants and two opposing experts, it is impossible to ignore the planned significant contributions of all members of the counsel team at the witness statement and expert report phases. The Defendants’ counsel will be approaching the trial with a pre-existing depth of knowledge as to the evidence that will ensure a shorter preparation time than might otherwise be the case.
iii) Whilst cross-examination of 15 Lead Claimants may appear an onerous task, the key issues for each of the Claimants will be the same (e.g. what were their individual circumstances at the time of their entry into the SAMs and what advice, if any, did they receive) and their individual mortgage documents are likely to be relatively limited.
    1. For reasons I have already given, I say nothing about the Defendants’ choice of counsel, or the Defendants’ decision to include estimated brief fees for their counsel which I regard as little more than aspirational. It would be invidious for me to descend into a discussion over the perceived “pre-eminence” of one leader, or junior, or another leader or junior (as it seemed at times during the hearing I was being invited to do).
    1. Standing back, however, I do not consider it reasonable or proportionate, having regard to the complexity of the litigation, for the Claimants to be exposed to such a high figure for trial preparation. The reason it is so high appears to be down to the fees of counsel. I also do not consider that my earlier observations about the value of the overall claim affects this position. I have identified factors which cut both ways but, even assuming that it is correct to consider the costs of this phase by reference to their relationship with the potential value of the 161 claims, I remain of the view that they cannot be justified having regard to the complexity of the exercise required in the trial prep phase.
    1. Although this is not ultimately a mathematical exercise, in this context it does seem to me that one way of determining what might be reasonable for this phase is to look at the impact of removing elements of the counsel fees which appear obviously to render the overall figure unreasonable.
    1. The first such element is the fees for junior counsel (too high by reason of the decision to instruct two juniors). A reduction for the fees of the additional junior amounts to £225,000. The second element concerns what I consider to be the purely aspirational (and therefore unreasonable) level of fees for preparation time of 14 weeks. A reduction of the remaining brief fees by half (a reduction of approximately £900,000) would bring them roughly into line with the 7 week preparation time assumed by the Claimants. The third element concerns the £75,000 estimated for the electronic bundle, in circumstances where there has, as yet, been no agreement as to the use of, or cost of, electronic bundles. This is an expense that can, if necessary, be addressed in due course. Applying these reductions to the existing total of £2,462,200 in this phase of the Second Budget, I arrive at a reduced figure of approximately £1,200,000.
  1. Standing back from those calculations, and having regard to the Claimants’ fees for this phase, whilst the figure of £1,200,000 is still substantially higher than the Claimants’ figure, I nevertheless consider it to be within a reasonable and proportionate range for the work required in this phase (albeit very much at the top end of that range).


The defendants sought £1,009,250. £750,000 was allowed.

    1. In the Second Budget, the Defendants estimate their costs of trial at £1,009,250, a figure they have reduced to £773,325 in the Offer. These figures are to be contrasted with the Claimants’ equivalent figure of £417,531 (made up of roughly £100,000 worth of solicitor time and counsel fees of £284,500 together with a small amount of additional disbursements). The two main reasons for the discrepancy between the budgets are (i) the planned attendance of both a grade A partner and an associate acting on behalf of the Defendants throughout the trial; and (ii) the estimated fees of the Defendants’ three counsel, amounting to a total of £585,000.
      1. Whilst I accept that it is reasonable in the context of a trial of this nature for the Defendants to desire the attendance of both a partner and an associate at the trial (together with support at the office as and when required), once again, it is the fees of counsel together with a different approach to the trial time estimate which increase the level of expense in this phase to well above that of the Claimants’ equivalent phase. In particular, while the Claimants have budgeted on the basis of a 24 day trial (albeit taking place in 6 weeks), the Defendants have expressly budgeted on the basis of an “estimated length of hearing [of] 30 days”, i.e. their budget assumes work on the case on non-sitting days.
    1. In my judgment, the estimated costs for trial in the Second Budget are unreasonable and disproportionate. For reasons I have already identified, I do not consider the costs of a third counsel (in the sum of £150,000 for this phase) to be reasonable and nor do I consider it reasonable or proportionate to budget for solicitor time costs and counsel fees in respect of a 30 day trial when the trial has been fixed for 24 days. Once again, this appears to me to be aspirational.
  1. Standing back, and always bearing in mind that the court is not engaging in a purely arithmetical exercise, it seems to me that a figure of £700,000 for the trial phase (albeit clearly at the top end of the range) is both reasonable and proportionate.