The Master of the Rolls has completed his consultation with the Law Society and Government about the need to change the guideline hourly rates following his report last year that such a change was not needed.
The outcome of this further consultation is that Lord Dyson has reiterated that guideline rates will remain as they have been since 2010. In a report issued last week various reasons for maintaining the present guideline rates were put forward. Principal amongst them was that there is a complete lack of central funding of the Civil Justice Council’s Costs Committee to pay for the in-depth survey required. Whilst reinforcing the importance and application of the existing guideline rates the Master of the Rolls identified the following factors that have reduced the importance of the rates:
- Advances in technology, business practices and models.
- The increasing sub-specialization of the law, which is seeing the market dictate rates in some areas, particularly commercial law.
- The judiciary’s use of proportionality as a driving principle in assessing costs.
- The greater adoption of (and familiarity with) costs budgeting amongst the judiciary and practitioners alike.
- Greater use of fixed costs.
Whilst the guideline rates will not increase in the foreseeable future they will remain the starting point in detailed assessment and a yardstick for costs budgeting. This does not preclude practitioners from charging increased rates or prevent awards above the guideline rates. Those seeking to recover hourly rates above the guideline rates would be well advised to prepare to justify those rates. Such an increase would be justified when:
- The case is legally or factually complex requiring suitably experienced solicitors.
- The case requires the instruction of solicitors in a more expensive place than where either the client or the court is located.
- The client has felt dissatisfied with previously instructed solicitors requiring instruction of new solicitors outside the area.
- The case is of considerable importance to the client.
- An increased rate for the solicitor with supervisory obligations may be justified where fee earners of a lower grade undertake the bulk of the work.
Useful guidance can be found in the pre-CPR cases of Truscott –v– Truscott & Wraith –v– Sheffield Forgemasters Ltd  EWCA Civ 2285 and Jones v Secretary of State for Wales  1 WLR 1008.