Guideline hourly rates for civil work have risen by around 2.3 percent with immediate effect
Solicitors have received an unexpected boost to civil litigation costs after guideline hourly rates were increased with immediate effect, marking the third consecutive year of rises.
HM Courts and Tribunals Service confirmed that the new rates apply across the board and represent an overall increase of around 2.3 percent. Unlike previous years, no advance notice of the uplift was given before the announcement.
Under the revised figures, Grade A fee earners based in central London can now expect to receive £579 per hour, reflecting a rise of 2.3 percent. The guideline hourly rate for Grade B fee earners in London has increased to £393, while Grade C now stands at £305 and Grade D at £210.
National rates have also increased by at least 2 percent. As a result of the changes, all Grade C fee earners across England and Wales now receive more than £200 per hour, regardless of location.
The new rates are published by HM Courts and Tribunals Service and apply immediately. Firms are being encouraged to review their retainers in light of the changes, although the guideline rates are not binding on parties and are not automatically awarded by the courts.
In previous years, practitioners were given advance notice of forthcoming increases. This time, no such warning was issued, despite earlier indications from the master of the rolls, Sir Geoffrey Vos, that the rates should be reviewed on an annual basis.
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The announcement has prompted discussion among cost specialists about how the revised rates may be applied in practice. Sean Linley, director of Newcastle-based costs firm Carter Burnett, said the upward revision could result in paying parties taking a firmer stance when faced with claims that exceed the guideline rates.
He said that paying parties were likely to argue that the regular reviews, particularly given the increases over three consecutive years, mean that the guideline hourly rates should now be regarded as more reliable when it comes to assessment. As a result, he suggested there may be fewer departures from the published figures.
Linley added that the change does not alter the established position that clear and compelling reasons are required to justify recovery of rates above the guidelines. He said that for higher value and more complex cases, the guideline hourly rates are still unlikely to be appropriate.
The increase is likely to be welcomed by many firms at a time of continuing pressure on legal costs, although its practical impact will depend on how courts and paying parties apply the revised figures in detailed assessments.