Litigators must tread carefully on shifting sands

You need a good sense of balance to be a civil litigator, because the ground is constantly moving beneath your feet.

The two seismic events of recent history were, of course, the 1999 Woolf reforms, and then the Jackson shakeup of 2013. But the tremors have far from ceased. While developments in 2019 may not register as high on the Richter scale as Jackson and Woolf, they will certainly be felt. 

Last month, we saw the introduction of a mandatory two-year disclosure pilot in the business and property courts in the Rolls Building in London, and the regional centres of Bristol, Birmingham, Cardiff, Leeds, Liverpool, Manchester and Newcastle. The initial push for these changes came from the GC 100, a powerful group of lawyers from the UK’s biggest corporates, which urged the judiciary to get a grip on this escalating and alarming generator of cost. 

The resulting new regime – drawn up with as much input from practitioners as possible, including road testing by a number of willing law firms – is essentially about forcing lawyers and their clients to deal with disclosure issues at a much earlier stage. This should do much to cut out the time and money currently spent on seeking and collating unnecessary or irrelevant data. Clearly, the potential financial saving is huge. But the downside (and there always is one) is that the burden of setting out a disclosure strategy is now heavily frontloaded. 

With the pilot having gone live just a few weeks ago, it is too soon to assess its impact just yet. But its success or otherwise will surely lie in the hands of the judiciary. If judges properly embrace the more proactive role envisaged for them under the pilot in respect of disclosure, then we could see a real transformation in disclosure costs. But if there is a repeat of the unhelpful and reluctant attitude with which judges greeted costs budgeting in 2013, then the pilot will struggle to achieve its aims.

The disclosure pilot was not the only new scheme to be launched last month. On 14 January, a two-year ‘costs-capping’ pilot also came into being in the London, Manchester and Leeds business and property courts. Open to cases with damages worth £250,000 or less, it offers a shortened procedure, with limited statements of case, documents, and witness and expert evidence. Costs will be capped at £80,000 and the whole process, from issue of claim to the trial hearing, should take no longer than 11 months. Again, judges are required to take a hands-on approach to the management of the case. 

Interesting as this pilot is, however, there must be a decent chance that it will flop. That is because it needs both parties to agree to use it. So lawyers on both sides will need to be encouraging their client to opt for a procedural scheme that limits the amount of fees they will receive in the case.

Moreover, clients on both sides will need to be convinced that adopting this capped costs scheme, which files down the teeth on a potentially vicious adverse costs bill, will not affect their chances of achieving a favourable settlement or winning at trial. It will be interesting to see what the takeup of this scheme actually turns out to be.

With two new pilot schemes starting just last month, will civil litigators now have a chance to catch their breath? Don’t be daft. The next target in the line of sight of reformers is factual witness statements.

This is another area where costs have soared, with statements getting longer and longer, and increasing amounts of fee-earning time spent on them. Like the parent who cannot resist improving their child’s homework, lawyers tweak, pad and perfect witness statements until their own input is far greater than that of the witness. And judges hate it. 

Hence a working group, led by Mr Justice Popplewell, was set up last year; and in November it launched a survey seeking the views of court users on whether the rules need to change. Some of the ‘blue sky thinking’ alternatives featured in the survey would certainly strike horror deep into the hearts of litigators. One alternative concerns the possibility of lifting privilege in the production of witness statements, so that all communication and drafts must be disclosed to the other side. 

The survey also sought views on whether written witness statements should be scrapped altogether in favour of oral examination-in-chief (though it is hard to imagine anything being deliberately brought in that would make trials longer) or the introduction of US-style ‘depositions’, with the other side’s lawyers present when the witness makes their statement. But perhaps what is more likely to happen is a new regime in which judges, once again, will be expected to take a much more active role in relation to witness statements. Where witness statements are drawn up in a way that breaches the rules, costs sanctions could be imposed on the offending party.

We will have to wait and see what proposals the working group ultimately recommends, whenever that may be. In the meantime, litigators will be staring warily at the ground, waiting for the sands to shift yet again.

Rachel Rothwell is editor of Gazette sister magazine Litigation Funding, the essential guide to finance and costs. For subscription details, tel: 020 8049 3890