NEW FIXED RECOVERABLE COSTS (FRC) RULES IN CIVIL LITIGATION FAQs
On 1 October 2023, new fixed recovery costs (FRC) rules came into force in civil litigation and will apply to most civil litigation claims and cases. Ian Williams has set out below some frequently asked questions and answers in order to assist our current and new civil litigation clients with this:
1) How will this affect my case?
The new FRC rules will apply to cases where court proceedings were issued on or after 1 October 2023 for cases valued less than £100,000.00. FRC rules prior to the 1st October 2023 only applied to cases valued less than £25,000.00. Therefore, this is a big jump in the number of cases where the FRC rules will capture after the 1st October 2023.
Cases valued above £100,000.00 will be allocated to the multi-track and FRC rules will not apply.
2) Are there are any other exemptions from the new FRC rules?
Yes, the new FRC rules will not apply to the following:-
A) If any party is a protected party, for example, a child;
B) FRC will only apply in personal injury claims where the cause of action accrues on or after 1 October 2023. For example, if an accident at work happens on 30 September, then the FRC rules will not apply to this example claim;
C) Residential housing claims are currently exempt;
D) Other types of case generally suitable for the multi-track, irrespective of value, such as mesothelioma, clinical negligence (please also see FAQ 7 below), abuse of/by children or vulnerable adults, trials by jury, and some Human Rights Act claims against the police; and
E) Costs greater than the new FRC rules can be applied for where vulnerable parties or witnesses have resulted in additional work leading to costs 20% above the new FRC rules.
3) Where can I find the new FRC rules?
These can be found in the new Civil Procedure Rules (CPR) Part 45, which sets out the new FRC rules. A new CPR Practice Direction 45 contains the tables of FRC.
4) What is the New Intermediate Track?
Updates to CPR Part 26 include an intermediate track for claims valued between £25,000 and £100,000: r. 26.9(7)-(11).
It is the normal track where trials will be 3 days or less, and expert evidence is likely to be limited to 2 experts per party. The usual factors (set out at CPR 26.13) to consider on allocation, such as complexity, importance, and the parties’ views, will continue to play a role.
Prior to the 1 October 2023, when the new fixed recovery costs regime (FRC) came into force, civil litigation claims and matters fell into three different tracks:
a) Small claims track – for claims normally valued up to £10,000.00;
b) Fast-track claims – for claims normally valued between £10,000.00 – £25,000.00; and
c) Multi-track claims – for claim normally valued £25,000.00 or above.
The new FRC rules now adds a fourth track to this called the “intermediate track” and is for claims valued between £25,000.00 - £100.00.00. The new intermediate track will also be the normal track where trials will be 3 days or less, and expert evidence is likely to be limited to 2 experts per party. There are also other factors to be considered on allocation, such as complexity, importance, and the parties’ views, which will all continue to play a role.
5) What are the new complexity bands?
These and their respective allocated FRC can be found in Tables 12 and 14 of the new CPR Practice Direction 45. Table 12 is by reference to the complexity band of a Fast-track claim. Table 14 is by reference to the complexity band of an intermediate-track claim. The allocated FRC costs will also depend upon the value of the claim and the stage of the case where it settles. Specialist legal advice FRC can also be found in Table 13 of the new CPR Practice Direction 45.
On allocation of your case, the court must now also assign claims to 1 of 4 complexity bands (in an ascending scale) and parties can agree the band between themselves, however, if the parties or the court disagree, the court will have regard to the same factors as considered on allocation.
6) How will this affect costs if I were to lose my case/claim?
If costs are awarded to the defendants, FRC will also apply to them if FRC rules also apply to your case/claim.
7) What about Clinical Negligence?
These new FRC rules will apply to clinical negligence claims with a value of up to £100,000.00 where "both breach of duty and causation have been admitted" and it is suitable to be allocated to the intermediate-track.
Also, the Government are planning to introduce FRC in all clinical negligence claims valued up to £25,000.00 from April 2024.
If you have any further questions regarding the new FRC rules, or wish for our assistance with your civil litigation matter, then please do not hesitate to contact Ian Williams at our Llandudno Office on 01492 874774.