Chris Lethem looks at the effect of new cost capping rules
In Willis v Nicolson [2007] EWCA Civ 199, [2007] All ER (D) 205 (Mar) the court declined to give guidance to practitioners as to the parameters and the practice of costs capping, preferring to refer the matter to the Civil Procedure Rules (CPR) Committee. That committee has accepted the challenge and now produced rules to govern costs capping (See r 9 et seq Civil Procedure (Amendment No.3) Rules 2008—applicable from 6 April 2009), introducing a new CPR 44.18–20).
Costs capping orders will only apply to “future costs”. By r 44.18(2) future costs are defined as costs incurred in respect of work done after the date of the costs capping order but excluding the amount of any additional liability. Two important elements come out of this definition. First there can be no attempt to reduce costs already incurred, in other words the order cannot be retrospective. Thus the new rule mirrors cases such as Henry v BBC [2005] EWHC 2503 (QB), [2006] All
