What Is The New ‘Intermediate Track’ In Civil Litigation And How Will It Affect My Case?
The process of civil litigation is complicated, and we have a detailed article on how it works here.
When you make an application to the court to commence proceedings, your case will be allocated to a particular track by the court, once a defence has been served and filed by the other side. Prior to 1 October 2023, there were three tracks, namely:
1. Small Claims Track
- This track is for most claims under £10,000 (excluding personal injury claims and housing disrepair).
2. Fast Track
- This track is for claims between £10,000 and £25,000.
3. Multi Track
- This track is for claims over £25,000, or for cases where there is a lesser amount claimed but the case involves complex points of law and/or evidence.
The ‘Intermediate Track’
A number of changes were made to the process of civil litigation on 1 October 2023, which is the date the Civil Procedure (Amendment No 2) Rules 2023 came into force. The reasoning behind the change of the rules is to try to make legal costs (and recovery thereof) more certain and proportionate across the board in relation to civil claims.
One of the key changes is the introduction of a new ‘Intermediate Track’ which will be for less complex claims valued at more than £25,000, but no more than £100,000. There is also a corresponding fixed recoverable costs regime.
The Intermediate Track is ‘sandwiched’ between the Fast Track and Multi Track. It is intended to be the normal track for claims which are likely to last no longer than three days and where oral expert evidence (if allowed) will be limited to two experts per party.
The Intermediate Track applies to both claims for monetary relief (i.e., a claim for damages), and to claims for non-monetary relief (i.e., a claim for specific performance (getting the other side to do something specific)). Mixed claims (where both damages and specific performance are requested by the claimant) will also be covered by the intermediate track (although bear in mind that the court will not allocate claims for non-monetary relief to the intermediate track unless it considers that it would be in the interests of justice to do so).
Claims within the fast and intermediate tracks will be assigned to one of four complexity bands (i.e., four for each track) and the scale of fixed costs will increase as complexity does. The court must, under the new rules, not only allocate a claim to a track but it must also assign it to a complexity band.
What are fixed recoverable costs and how do they work?
As referred to briefly above, the fixed recoverable costs regime (known as the “FRC Regime”) has been extended significantly, which commenced on 1 October 2023 (except for housing claims). FRCs set the amount of legal costs that the winning party can claim back from the losing party in civil litigation. FRCs already applied prior to 1 October 2023 in most low-value personal injury claims.
FRC Regimes give certainty in advance about the maximum amount a losing party will need to pay the winning party. However, as a consequence, the amount the winning party can reclaim may not actually cover the actual costs of the case (predicting this can be difficult).
Under the new rules, the FRC Regime is extended to all civil cases in the Fast Track (i.e., those cases valued up to £25,000 in damages that will last no longer than a day (except for housing claims). The FRC Regime also applies to the new Intermediate Track (i.e., those claims that are valued up to £100,000).
The FRC Regime applicable to each track will be set by a grid of costs and will depend on the following factors:
- the case’s complexity band; and
- The stage the claim has reached.
Where the Claimant asks for relief that is non-monetary (i.e., a claim for specific performance), any such relief is now assigned a fixed value for the purposes of the FRC Regime (by reference to the case’s complexity banding).
Please see our detailed article on the FRC Regime here.
Which cases will these new rules apply to?
The Intermediate Track (and its corresponding FRC Regime) potentially covers a wide range of claims in relation to property, including non-monetary relief if judges decide to allocate the claim to the track (if it is in the interests of justice to do so). Other cases will also fall into the ambit of the Intermediate Track, namely:
- dilapidation claims;
- boundary disputes; and
- claims for commercial rent arrears.
Cases excluded from the FRC Regime include claims for possession, disrepair, and unlawful eviction in respect of residential properties.
By way of example, in Lord Justice Jackson’s report in 2017 titled ‘Review of Civil Litigation Costs: Supplemental Report Fixed Recoverable Costs’, the sort of cases which should be included in this new FRC Regime were alluded to. It was considered that the new FRC Regime should apply to claims which are mainly for monetary relief, such as damages or debt claims. Claims for non-monetary relief may also be assigned to the new FRC Regime where it is necessary to promote access to justice. LJ Jackson refers to the following examples:
- if individual householders are claiming an injunction to restrain private nuisance caused by a nearby industrial enterprise, they may not be able to proceed unless their adverse costs risk is limited by an FRC regime; and
- Individuals of modest means bringing defamation claims because of material on the Internet (a growing category of claimants) may only feel comfortable proceeding if their adverse costs risk is limited by an FRC regime.
Can the judge use their discretion in relation to the complexity bands?
In short, it does seem to be the case that judges retain the discretion to allocate more complicated cases to the multi-track.
Furthermore, given that the complexity bands are defined in a way that is “intended to provide helpful clarity without being overly descriptive”, there will most likely be room for debate on the banding of a case, especially if it is a property case in the Intermediate Track for example.
Have these new rules come into force and which cases do they apply to?
These rules apply to claims where proceedings are issued on or after 1 October 2023 (save for personal injury and disease claims).
The new fixed recoverable costs regime will apply to personal injury claims where the cause of action accrues on or after 1 October 2023 and will only apply to disease claims where the letter of claim has not been sent to the other side before 1 October 2023.
What do the changes mean in practice?
With the introduction of the new ‘Intermediate Track’, it is intended that there will be more active case management by the courts, although directions will still follow a standard pattern. The new track is designed mainly for damages and money claims, with a limit of three days of court time for the trial and some categories of cases are automatically excluded. The court will organise a case management conference and the parties must try to agree on directions and file them at the court prior to the hearing. The hearing will be vacated if the directions are approved.
The new rules are not at all simple and as it is expected, there may be some teething trouble in respect of the court’s implementation of the rules. The main intention behind these changes is to encourage early resolution and settlement of a case in light of greater clarity about the level of costs involved. However, it remains to be seen as to whether this will work well in practice.
As always, it is important to ensure that you seek competent legal advice at an early stage of any dispute so that it can be resolved without wasting emotional energy, time and costs. If you require assistance to resolve a dispute or the matter is heading towards litigation (or even if the matter is already in court), we would be more than happy to advise and guide you. As always, we will ensure that your matter is dealt with efficiently, diligently and effectively.
This article is intended for general information only, applies to the law at the time of publication, is not specific to the facts of your case and is not intended to be a replacement for legal advice. It is recommended that specific professional advice is sought before relying on any of the information given. © Jonathan Lea Limited 2023.