Expenses in the Scottish courts — new rules
The 2019 Rules apply to actions raised in the Sheriff Court, Sheriff Appeal Court and Court of Session
The Act of Sederunt (Taxation of Judicial Expenses) Rules 2019 enter into force on 29 April 2019 bringing a change to the way in which solicitors’ expenses are recovered in litigated actions before the Scottish courts. The 2019 Rules apply to actions raised in the Sheriff Court, Sheriff Appeal Court and Court of Session.
From 29 April 2019, fees recoverable will be made on a six-minute unit-based charge rather than on a block fee basis. Each unit is to be charged at £16.40 with the table of block fees being replaced with a new table of charges.
Under the general principles of the 2019 Rules, it is made clear that the Auditor responsible for taxing the account of expenses must allow only such expenses as are reasonable for conducting the proceedings in a proper manner. The rules also permit the Auditor to refuse to allow any expenses which the Auditor considers have been incurred due to the fault or error on the part of the party entitled to recover expenses.
A new time limit for Sheriff Court actions is being introduced, which places an obligation on the party seeking recovery of their expenses to lodge an account of expenses no later than four months after the final judgement in the case. Lodging an account outside of this time limit may be allowed with the permission of the Sheriff, but the Sheriff has the discretion to impose such conditions as the Sheriff thinks fit. This mirrors the current rules which apply to Court of Session actions.
In Sheriff Court and Sheriff Appeal Court actions, parties will now be entitled to apply to the Sheriff to grant sanction for the employment of counsel for the whole proceedings, any part of the proceedings, any particular work involved in the conduct of the proceedings, or any combination of the foregoing.
For most non-personal injury Sheriff Court actions, sanction for counsel will also now need to be sought before counsel is instructed. A similar rule will apply to the certification of skilled witnesses in most non-personal injury actions.
The rules also provide that an application to recover the charges of a skilled witness will only be allowed if the court is satisfied that the person is a skilled person and that it is, or was, reasonable and proportionate for that person to be employed in the case.
In relation to seeking any uplift on expenses, the 2019 Rules give the court power to grant an increase in the expenses sought. The Rules provide that such an increase should only be granted where the court is satisfied that an increase is justified to reflect the responsibility undertaken by the solicitor in the conduct of the proceedings.
When considering an application for an uplift, the court should have regard to matters such as the complexity of the proceedings, the importance of the proceedings, the amount or value of money or property involved in the proceedings, and the steps taken with a view to settling the proceedings or limiting the matters in dispute. Any awarded increase must be awarded as a percentage.
The implementation of these new Rules is based upon Sheriff Principal Taylor’s Review of Expenses and Funding of Civil Litigation in Scotland published on 11 September 2013. In the foreword of his report, Sheriff Principal Taylor recommended that for all actions subject to active judicial case management, a motion for sanction for the employment of counsel should be made at the start of proceedings, or at a later stage, on cause shown.
However, rather disappointingly, under the new rules there is no requirement in personal injury actions for the sanction for the employment of counsel to be sought at the outset of proceedings or prior to the instruction of counsel.
It will also remain to be seen whether the adopted change from a block fee basis to a unit based charge will result in an increase or decrease in the amount of expenses sought to be recovered by those awarded expenses.
The new Rules can be found here: http://www.legislation.gov.uk/ssi/2019/75/made
If you have any questions or would like to know more about our legal update, please contact Pamela Stevenson, Partner on email@example.com, or 0141 375 0867 or Callum MacKinnon, Solicitor on firstname.lastname@example.org, or 0141 375 0861
For further information on expenses in the Scottish Courts, contact our insurance lawyers.