Detailed Assessment proceedings are a critical phase in legal matters, ensuring that costs are fairly and accurately determined. Understanding the rules governing the commencement of costs proceedings and the consequences of delay is essential for those who hope to maximise their recovery of costs and who wish to avoid the Courts wrath!
Having a valid Assessment Instrument
If proceedings have been issued, a valid assessment instrument would be a Court Order (which includes a costs provision) or acceptance of a Part 36 offer (as long as the acceptance is within the relevant period – failing which, a Court Order will be required).
If proceedings were not issued, it is possible to initially serve an informal Bill of Costs (with no Notice of Commencement and therefore no timescale for Points of Dispute). If an agreement could not be reached, a Part 8 Order would be required.
Commencement of Detailed Assessment Proceedings (CPR 47.6):
Detailed assessment proceedings kick off with the receiving party serving the paying party with a Notice of Commencement and Bill of Costs together with documents set out within CPR 47 PD 5.2, the same being:
- a notice of commencement in Form N252;
- a copy (or, where paragraph 5.A4 applies, copies) of the bill of costs;
- copies of the fee notes of counsel and of any expert in respect of fees claimed in the bill;
- written evidence as to any other disbursement which is claimed and which exceeds £500;
- a statement giving the name and address for service of any person upon whom the receiving party intends to serve the notice of commencement;
- if a costs management order has been made (and if the same information is not already fully provided in an electronic bill), a breakdown of the costs claimed for each phase of the proceedings. Precedent Q in the Schedule of Costs Precedents annexed to this Practice Direction is a model form of breakdown of the costs claimed for each phase of the proceedings.
Period for Commencing Detailed Assessment Proceedings (Rule 47.7):
Understanding the timeframe for commencing Detailed Assessment is also crucial. The table contained within CPR 47.7 outlines the periods based on the source of the right to detailed assessment. Whether it arises from a judgment, discontinuance under Part 38, or acceptance of an offer to settle under Part 36, practitioners must adhere to specific timeframes, generally within three months.
Sanction for Delay in Commencing Detailed Assessment Proceedings (Rule 47.8):
Failure to commence Detailed Assessment proceedings within the specified period can lead to sanctions. CPR 47.8 empowers the paying party to apply for an Order requiring the receiving party to initiate proceedings within a specified time. The Court, upon application, may direct that failure to comply with the Order could result in the disallowance of all or part of the costs the receiving party would otherwise be entitled to.
In addition if the paying party does not apply for an order, and the receiving party commences proceedings later than the timescales specified in CPR47.7, the Court may disallow part or all of the interest payable to the receiving party under relevant statutes.
In conclusion, it is useful for practitioners to know and understand the process for commencing detailed assessment. Although it only takes up a small amount of the blog, it is important to know when you do and do not have a valid Assessment instrument. Finally, whilst the sanctions are not, in many cases disastrous it is useful to know what can happen. The most famous case regarding the delay in commencing detailed assessment proceedings is that of Botham v Niazi [2004] EWHC 2602 (QB) (16 November 2004) – this involved a 7 year delay with the only repercussion being the disallowance of the interest!
For more information regarding the Commencement of Detailed Assessment, contact Karl Robson here.
