Electronic Billing
Introduction
Some law firms will want to try and undertake Electronic Billing in-house. That’s fine but it’s a minefield and as with any minefield, it’ll be ok as long as you have the map. Costs Draftsmen must be fully equipped to navigate a whole new way of Billing.
How the new system is intended to operate….
The plan is for all Part 7 Multi-track cases to be electronically billed in the future but initially we have to work our way through a transition period.
New Practice Direction 47 Rule 47.6 (attached) addresses concerns about how the system will operate.
Practice Direction 5.1 confirms that, with a few exceptions, all parts 7 Multi-track cases must proceed by way of Electronic Bill if costs claimed relate to work done from 6th April 2018.
Practice Direction 5.A4 deals with the transition provisions….
There are 3 possible situations.
1. Main action concludes on or before 6th April 2018 : Paper or electronic bills can be used.
2. Main actions which straddle the 6th April : For work done prior, the bill can be paper or electronic. However, for the work done after 6th April those parts of the bill must be electronic.
3. For main actions which begin after 6th April : The eventual bill must be in electronic format.
Practice Direction 5.1A says that you can’t file and serve bills by email alone. Hard copies must be sent.
How the system is likely to operate?
COURTS
The Courts need to be fully ready for the new format of bill. They will be receiving many different formats and will be expected to process them as efficiently as before.
Costs Judges will need to know how to assess bills which are in the new format and will have to be ready to deal with varying formats of bill, remembering that a case which straddles the 6th April can, and probably will, have 2 bill formats in the same case.
District Judges have a hard enough job as it is. This process is going to make that much more difficult, at least initially. The time it will take to properly assess a Bill of Costs or Bills of Costs will increase because the process is quite intricate due to the way the claim for costs is now to be set out.
THE PARTIES
All parties to the costs proceedings need to be ready but inevitably not everybody will be.
Not all firms are used to working digitally and not all firms have in-house or external training.
Not all firms have costs companies on hand who have researched the subject in minute detail on their behalf.
Some firms might try and navigate their way around the system without external help. Invariably this will lead to problems. We saw it when Precedent H’s were introduced.
There are bound to be teething problems but everyone will be expected to make it work.
The rules are in place as is the Precedent and the Courts will not have any sympathy for anyone who isn’t set up and ready.
So as from now, when you settle any case, you will need to make a few decisions.
Firstly, how should you bill it?
Your firm will need to decide whether to bill the case electronically either fully or partially.
THE TIMETABLE
This is the key date.
If your substantive actions are ongoing as at this date your costs will have to be claimed in the new way, at least partially if not fully.
Once billed, the detailed and provisional assessment timetable remains as it is.
POTENTIAL PITFALLS
There are two main potential pitfalls:-
1) Failing to correctly complete the Precedents
2) Failing to comply with the part 47 Timetable.
The way to avoid these is to ensure that you and your costs people know what to do from the start.
THE BEST WAY FORWARD
All law firms must decide how they want to deal with:-
a) Transition cases and
b) All other cases
Electronic Bills are mandatory in certain cases i.e. post 6th April 2018 Part 7 Multi-track cases.
Guy Platt-Higgins LLB (Hons) Law Costing Ltd
Commencement of Detailed Assessment Proceedings: Rule 47.6
5.1
In the circumstances provided for in this paragraph, bills of costs for detailed assessment must be in electronic spreadsheet format and compliant with paragraphs 5.A1 to 5.A4 (“electronic bills”) while in all other circumstances bills of costs may be electronic bills or may be on paper (“paper bills”) and compliant with paragraphs 5.7 to 5.21. Precedents A, B, C and D in the Schedule of Costs Precedents annexed to this Practice Direction are model forms of paper bills of costs for detailed assessment. The circumstances in which bills of costs must be electronic bills are that—
(a) the case is a Part 7 multi-track claim, except—
(i) for cases in which the proceedings are subject to fixed costs or scale costs;
(ii) cases in which the receiving party is unrepresented; or
(iii) where the court has otherwise ordered; and
(b) the bills of costs relate to costs recoverable between the parties for work undertaken after 6 April 2018 (“the Transition Date”).
5.A1
A model electronic bill in pdf format is annexed to this Practice Direction as Precedent S and a link to an electronic spreadsheet version of the same model bill is provided in paragraph 5.A2 of this Practice Direction.
5.A2
Electronic bills may be in either the spreadsheet format which can be found online at http://www.justice.gov.uk/courts/procedure-rules/civil or any other spreadsheet format which—
(a) reports and aggregates costs based on the phases, tasks, activities and expenses defined in Schedule 2 to this Practice Direction;
(b) reports summary totals in a form comparable to Precedent S;
(c) allows the user to identify, in chronological order, the detail of all the work undertaken in each phase;
(d) automatically recalculates intermediate and overall summary totals if input data is changed;
(e) contains all calculations and reference formulae in a transparent manner so as to make its full functionality available to the court and all other parties.
5.A3
The provisions of paragraphs 5.7 to 5.21 of this Practice Direction shall apply to electronic bills insofar as they are not inconsistent with the form and content of Precedent S. Where those paragraphs require or recommend division of the bill into parts, electronic bills (unless the format of the bill already provides the requisite information, for example in identifying the costs within each phase) should incorporate a summary in a form comparable to the “Funding and Parts Table” in Precedent S to provide the information that would otherwise be provided by its division into parts.
5.A4
Where a bill of costs otherwise falls within paragraph 5.1(a) but work was done both before and after the Transition Date, a party may serve and file either a paper bill or an electronic bill in respect of work done before that date and must serve and file an electronic bill in respect of work done after that date.”.
5.1A
Whenever electronic bills are served or filed at the court, they must also be served or filed in hard copy, in a manageable paper format as shown in the pdf version of Precedent S. A copy of the full electronic spreadsheet version must at the same time be provided to the paying party and filed at the court by e-mail or other electronic means.
5.2
On commencing detailed assessment proceedings, the receiving party must serve on the paying party and all the other relevant persons the following documents —
(a) a notice of commencement in Form N252;
(b) a copy (or, where paragraph 5.A4 applies, copies) of the bill of costs;
(c) copies of the fee notes of counsel and of any expert in respect of fees claimed in the bill;
(d) written evidence as to any other disbursement which is claimed and which exceeds £500;
(e) a statement giving the name and address for service of any person upon whom the receiving party intends to serve the notice of commencement;
(f) if a costs management order has been made (and if the same information is not already fully provided in an electronic bill), a breakdown of the costs claimed for each phase of the proceedings. Precedent Q in the Schedule of Costs Precedents annexed to this Practice Direction is a model form of breakdown of the costs claimed for each phase of the proceedings.