Judge: Jacobs J
Citation:  EWHC 3102 (QB)
It is not the role of the Court at a CCMC to fix or approve hourly rates claimed in the budget: the issue is whether the budgeted costs for each phase are reasonable.
At a costs budgeting hearing, the Claimant’s costs budget was approved, as was the Defendant’s, “save that the parties reserved their positions as to incurred costs and as to hourly rates [and] it remains open to them to dispute those matters (and to that extent the figure for each phase) at a detailed assessment”. The Claimant appealed against the decision, arguing that it was inconsistent with PD3E, paragraphs 7.3 and 7.10, which provided that “the Court’s approval will relate only to the total figures for budgeting costs for each phase of the proceedings” and “it is not the role of the Court in the Costs Management Hearing to fix or approve the hourly rates claimed in the budget”.
On appeal, the Court held that the Master had erred in purporting to approve the constituent elements of the budget when the Practice Direction indicated that the Court’s approval would relate only to the total figures for each phase. It is not the role of the Court to fix or approve the hourly rates claimed in the budget. The detail provided by the party for each phase of the budget, in order to calculate the totals, was provided for reference purposes only in order to assist the Court. The Master was in error, leaving hourly rates, and thus the figure for each phase, to be disputed in detailed assessment. The aim of budgeting was to reduce issues for detailed assessment and provide certainty for the parties on the likely level of payment or recovery. An approved budget should only be departed from for good reason. The Court should not micromanage the costs budget. The issue for the Court was whether the budgeted costs for each phase were within a reasonable range.