6 Questions to ask your costs draftsman

1. Is your costs draftsman an expert in your type of law?

 

Many costs draftsmen maintain that they are experts in all areas of costs. They fail to appreciate the significant differences between different law specialisms.

 

Specific knowledge of a legal specialism ensures

 

-        Costs claimed reflect the steps taken and work required during litigation

-        Valuations and offers made correctly reflect the specific circumstances of the case

-        The optimum level of costs are recovered

-        Cases are not progressed without full appreciation of risk

 

2. Who drafts your bill?

 

Given the increasing costs pressure on costs draftsman many firms delegate preparation of a bill of costs to a junior fee earner and then transfer the file to a negotiator. This approach carries significant disadvantages:

 

-        A junior fee earner often has no legal knowledge or experience of litigation.

-        A junior fee earner is likely not to produce a bill of costs which correctly reflects the complexity and level of work undertaken

-        An effective narrative will not be prepared

-        Inappropriate assumptions will be made during preparation of the bill of costs

-        The negotiator, having not prepared the bill, makes assumptions as to recoverability of individual elements of the costs claimed

-        Transfer of files between costs draftsman introduces additional risks

-        Costs are increased as work is duplicated

 

3. Does your costs draftsman share risk with you?

 

Your costs draftsman should work with you and not be a further fixed cost for you to bear.

 

Where costs are successfully recovered there are often reductions ordered by the court or agreed during negotiation. If your costs draftsman’s fees are fixed by reference to time expended or the level of the bill of costs prepared what seems like a reasonable fee as a proportion of costs claimed at the outset, can be an unreasonable fee when compared to costs recovered.

 

Your costs draftsman should be focused on building a long term relationship with you. They should share the risk you face. If you recover 80% of costs claimed your costs draftsman’s fee should also be reduced to 80%.

 

4. Does your Costs Draftsman charge for Costs Budgets if the case is unsuccessful?

 

Costs Budgeting has imposed an additional burden on solicitors which is often added to by your costs draftsman.

 

Unfortunately not every case which is the subject of Costs Budgeting is successful.

 

The fees charged by your costs draftsman may appear reasonable for preparation of a costs budget. However this is often not the case where consideration of the cost of preparing budgets for cases which are ultimately unsuccessful are included.

 

5. What does your costs draftsman charge?

 

When considering the fees charged it is tempting to focus on the headline figure. However is not the sole factor which must be considered:

 

-        We charge X% of the bill of costs prepared – This method of charging causes a conflict of interest for your costs draftsman. It is in your costs draftsman’s best interest to produce a high bill as this directly affects the fee recovered by the costs draftsman. This increases challenges, prolongs costs recovery and increases the risk that costs of assessment will be payable.

 

-        Our hourly rate is only £X – It is tempting to be attracted to the lowest hourly rate, but this does not always result in the lowest fee. 5 hours at £146 per hour is cheaper than 10 hours at £90. As with solicitors, more experienced, and less inexpensive, fee earners can apply their expertise to produce work of a higher standard in less time than a more junior fee earner.

 

6. When do you have to pay your costs draftsman?

 

Cash flow is the life blood of any company and your costs draftsman should work with you and not against you.

 

Many costs firms require payment for costs budgets as soon as they are prepared. Given the fact that the case may not conclude for a further year or more this is a significant cost across your book of cases.

 

Costs of bill preparation are also often invoiced once the bill is prepared. Again this is a drain on your cash flow.

 

To discuss how we can improve your costs recovery, cash flow and provide you with expert advice on all aspects of legal costs please contact Charles Cuthbert on 01629 690095 or via e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it.