After much anticipation, the Legal Aid Agency’s pilot scheme is finally being rolled out to providers. From 19th April applications for a number of proceedings will be granted a £25,000 costs limitation. This will reduce administrative time considerably – without having to apply for increases there will be less delays so you can act quickly for a client and less time on CCMS waiting for response. Having followed the progress of the LAA PET team’s pilot scheme over the last year and the success rates demonstrated by them, Kutter Walters welcomes the change!

For cases entering into hourly rates High Costs, this will also simplify processes. With fast moving cases that jump from £15,000 to £25,000 in a couple of weeks, often there have been issues with registering a case as high costs before the increased limitation is put in place. Whilst costs increases should not be retrospective, with these cases the steps required to increase the limitation quickly, then wait for the costs increase confirmation and then register as high costs has been burdensome for firms. This can also cause a huge loss to the firm if the Pre-Contract costs are limited.

However, there is a warning that should be provided to all firms. Merits evidence is still going to be required to justify costs when the matter concludes instead, so strict procedures should be maintained to monitor this (guidance will be provided by the LAA). A £25,000 cost limit does not mean that the LAA will consider this a reasonable limit for the work being undertaken and, under the new scheme, it may be that you have already done the work before you realise this if procedures are not kept in place. There is a higher risk now for firms who undertake all work and leave costs considerations to the end of the case.

Overall, this should be a great step forward for Legal Aid firms and their clients!