FIXED RECOVERABLE COSTS: A POWER TO ORDER GREATER AMOUNTS IN “EXCEPTIONAL CIRCUMSTANCES” AND THE STING IN THE TAIL

Continuing the examination of fixed recoverable costs.  CPR 45.9 gives the court power to order sums greater than FRC in “exceptional circumstances”.  The applicant’s difficulties are (i) there is no definition of exceptional circumstances (ii) there is a real sting in the tail.

 

CPR 45

Claims for an amount of costs exceeding fixed recoverable costs

45.9.—(1) The court may consider a claim for an amount of costs (excluding
disbursements) which is greater than the fixed recoverable costs referred to in Section VI,
Section VII or Section VIII of this Part where there are exceptional circumstances making it
appropriate to do so.
(2) If the criteria in paragraph (1) are met, the court may—
(a) summarily assess the costs; or
(b) make an order for the costs to be subject to detailed assessment.

THE STING IN THE TAIL

The danger exists if costs are assessed.  If the assessed sum is less than 20% greater than the fixed recoverable sums then the court shall make an order that the applicant receives the lesser of the fixed recoverable costs or the assessed costs. In other words if you have an assessment and you recover costs that are, say, 19% more than FRC, you will still recover only the fixed recoverable costs.

 

Failure to achieve costs greater than fixed recoverable costs

45.11.—(1) This rule applies where—
(a) costs are assessed in accordance with rule 45.9(2) or 45.10(2); and
(b) the court assesses the costs (excluding any VAT) as being an amount which is in a
sum less than 20% greater than the amount of the fixed recoverable costs.
(2) The court shall make an order for the party who made the claim to be paid the lesser
of—
(a) the fixed recoverable costs; and
(b) the assessed costs.