Blog - Wednesday 25 May 2016


When is it appropriate to ‘amend’ a Budget?


It is hardly surprising that Costs Budgeting remained one of the most debated issues at the annual ACL Costs Conference which took place on 13 and 14 May 2016. Particularly notable were Roger Mallalieu’s remarks on the recent decision of Mr Justice Picken in Churchill -v- Boot (22/04/2016).

This case arose out of a serious road traffic accident in which the Claimant allegedly sustained a brain injury. Due to severity of the Claimant’s injuries, the claim doubled in value since originally pleaded and necessitated updated medical evidence as well as notable additional disclosure, namely employment and educational records. The Trial was subsequently delayed by six to nine months. The Claimant sought to amend the Budget approved in 2014 whilst relying on CPR 3 Practice Direction 3D Paragraph 7.6 which states:

‘Each party shall revise its budget in respect of future costs upwards or downwards, if significant developments in the litigation warrant such revisions. Such amended budgets shall be submitted to the other parties for agreement. In default of agreement, the amended budgets shall be submitted to the court, together with a note of (a) the changes made and the reasons for those changes and (b) the objections of any other party. The court may approve, vary or disapprove the revisions, having regard to any significant developments which have occurred since the date when the previous budget was approved or agreed.

The permission to amend the Budget was originally refused by the Master on the basis that there had been no significant development within the meaning of paragraph 7.6 since the original Budget had been approved. The Claimant appealed.

As reported by Lawtel and noted by Mr Mallalieu , Mr Justice Picken found that there was no merit in the Claimant's ground of appeal as the Master had exercised his discretion in a way not susceptible to challenge, G v G (Minors: Custody Appeal) [1985] 1 W.L.R. 647 followed.

Mr Justice Picken reconfirmed that doubling the amount of the claim did not necessarily justify an increase in costs and  agreed with the Master the ‘developments’ relied upon by the Claimant  foreseeable at the time of the original Costs Budget being filed. Education and employment records, were deemed standard type of disclosure for this type of claim and should have been contemplated when the Costs Budget was firstly set. With regards to expert evidence, as the original 2014 Direction Order had identified the expert disciplines from which reports could be adduced; it was found that it had always been envisaged that the experts would review the types of documents sought through disclosure.  It was thus difficult to see how the subsequent reports were a significant development, in the sense of being significant and previously unexpected. An adjournment could potentially be a significant development. However on the facts of this case it was not.

Following Mr Justice Picken’s reasoning, matters which are ‘capable of being envisaged’ cannot be relied upon as ‘significant developments’ under CPR 3 PD 7.6.  

Such ruling surely reaffirms the importance of clarity when the parties Budgets are both filed and approved in the first instance and puts into doubt updated Guidance Notes on Precedent H which under paragraph 8 expressly discourages preparation of detailed Assumptions and advocates for Judges to disallow costs of their preparation.


By Slava Price - Costs Lawyer