The intermediate track – Battle of the bands

From October 2023, the fixed recoverable costs (“FRC”) regime was extended across the fast track to a new Intermediate Track for the so-called ‘simpler’ cases valued up to £100,000. The aim of the new Intermediate Track is to improve access to justice by better striking the balance between efficient case management and greater costs certainty/proportionality. So, just over a year later, what do we know so far about the Intermediate Track?

The two most recent Quarterly Civil Justice Statistics Reports paint an interesting picture (for those litigators not on-the-edge-of-your-seat-excited about the extended FRC regime, I use the term ‘interesting’ here in its loosest sense, obviously):

• According to the Q2 April to June 2024 report, since the introduction of the new FRC regime only 135 claims had by that point been allocated to the Intermediate Track. To contextualise that figure, in Q2 30,000 money and damages claims were allocated to track; 7,600 to the Fast Track and 1,700 to the Multi-Track.
• In the Q3 July to September 2024 report, no further update is provided as regards the number of claims allocated to the Intermediate Track, however the reader is advised “these [Intermediate Track] cases are expected to be included in the next publication”. So—watch this space! Also of interest (see earlier parenthetical disclaimer above) is the “Statistician’s comment”, which notes claims received in the County Courts have continued to rise and are at the highest level since Q1 2020.

Overall, therefore, the short point is this: whilst the number of claims litigated in the County Court continues to increase, the use of the Intermediate Track remains relatively low. That is no doubt due to the scope of the track: it applies (subject to certain exceptions) only to PI claims excluding disease where the accident occurred after 1 October 2023, or to disease claims where the Letter of Claim is sent after the same date, or all other claim issued after the same date. So, it is obviously still “early days” as regards ascertaining the pros or cons, or dos or don’ts, about this new track since the vast majority of claims heading towards it remain at the pre-action stage. We of the PI & Travel Team at 3 Hare Court wait with bated breath to see what the Quarterly Civil Justice Statistics for Q4 hold and what further light those data might cast on the Intermediate Track!

In the meantime, here are three practical and strategic pointers for those who are likely to interact with the Intermediate Track in the future, based on practical (albeit limited) direct experience of the new extended FRC regime.

Prepare early for a battle of the (complexity) bands

It is helpful to bear in mind at the outset (need we remind ourselves!?) of the four Intermediate Track complexity bands and their definitions (see CPR r.26.16):

Every Claimant in a PI dispute wishes to be in the higher complexity bands since those are commensurate with more FRCs. The definitions are similar (especially as between bands 2, 3 and 4). But the Rules do not amplify the bands further, and the White Book Commentary contains no illustrative examples. We all know that where the Court is allocating, it must have regard to the well-known factors at CPR r.26.13(1)[1]. We know also that it is for the Court to assess financial value and in doing so it will disregard any amount not in dispute; claimed interest; costs; contributory negligence; and certain prescribed amounts where a claim is for non-monetary relief (CPR r.26.13(2)).

It is an obvious point, perhaps, but in practice parties must from the earliest stages craft their cases with a close eye on complexity bands. For example, a Defence putting everything into issue might later prove a helpful springboard for a Claimant’s case on a higher complexity band. By contrast, if a Defence agrees all non-contentious matters and adopts a pragmatic approach to figures contained in a schedule of loss, that may later mean that, by virtue of CPR r.26.13(2), a more powerful argument can be made in favour of a lower complexity band since the value in dispute will be lower.

A detailed directions questionnaire (“DQ”) pays dividends

Although the rules say parties may agree upon a complexity band (CPR r.26.14(4)), this is (respectfully) wishful thinking. There are obvious tensions between adversaries’ positions on allocation. For example, a Claimant would argue the claim’s value will exceed £100,000 so as to benefit from the more generous costs regime on the Multi-Track, whilst a Defendant would argue the claim’s value is below £100,000 so as to bring the claim within the FRC regime on the Intermediate Track.

DQs are (as ever) of vital importance in this context. They ought to be prepared carefully and with a close eye on the complexity band definitions. If a lower complexity band is sought by a Defendant, for example, the DQ must explain cogently why the claim is a “less complex” one and practitioners ought to think proactively about what points can be advanced to meet the other side’s arguments. Defendant practitioners should also be wary of Claimants seeking to lay the groundwork for a higher complexity band by reference to a factor such as expert evidence in more than one discipline—that, on its own, ought not to nudge a claim into a higher complexity band. Claimant practitioners should bear in mind, too, that the new FRCs regime reiterates the Court’s power to make an order directing the claimant to justify the amount claimed where the Court believes the amount exceeds what the claimant may reasonably be expected to recover (Practice Direction 26 para 14(6)), and Defendant DQs may invite the Court to exercise this power in the event it is thought a claim has been issued at an optimistically value so as to justify a higher complexity band allocation—as such, the claim value must be sufficiently robust and defensible by reference to the pleadings /provisional schedule of loss and DQ.

Pitch perfect Defendant Part 36 Offers

A well-pitched Part 36 offer is a powerful weapon in the litigation arsenal. On the Intermediate Track, an early Defendant Part 36 offer may be a factor the parties bear in mind when considering complexity band allocation.

This is because under the extended FRC regime, if a winning Claimant fails to beat a Defendant’s Part 36 offer, then the Defendant is liable for the Claimant’s FRC to the stage the claim reached when the relevant period expired, and the Claimant is liable for the Defendant’s costs to the trial stage (less the FRC to which the Claimant was entitled). Strategically, therefore, a very well-pitched, early Defendant Part 36 offer could dissuade a Claimant from seeking a higher complexity band since the higher the band the greater the Claimant’s liability for costs in the event she fails to beat the Defendant’s Part 36 offer at trial.

[1] CPR r.26.13(1): the financial value, if any, of the claim; the nature of the remedy sought; the likely complexity of the facts, law or evidence; the number of parties or likely parties; the value of any counterclaim or additional claim and the complexity of any matters relating to it; the amount of oral evidence which may be required; the importance of the claim to persons who are not parties to the proceedings; the views expressed by the parties; and the circumstances of the parties