Precedent S: the electronic bill of costs explained

Practice Direction 47 requires bills of costs for Part 7 multi-track claims to be in electronic form for work done after 6 April 2018, subject to exceptions. Bills for litigants in person are excluded, and the court can direct otherwise in a particular case. Other claims can still use the traditional paper format, although many practitioners now use electronic bills more widely.

Before drafting, confirm the claim type, the track and the periods covered. A bill spanning work before and after the start date, or several costs orders, needs a structure that separates those periods clearly. Getting the scope right is part of preparing bills of costs that can be defended rather than simply produced.

The model spreadsheet uses phases that mirror Precedent H budgeting, such as pre-action, issue and statements of case, disclosure, witness statements, experts, trial preparation and settlement. Within each phase, work is recorded by task and activity codes, with the fee earner, grade, time and rate for each item.

Summary tabs total the costs by phase, by party and by period. That structure allows a paying party to filter time by fee earner or task and compare budgeted phases directly. It also means that weak entries are easier to identify, so the narrative and coding must be accurate from the outset.

Where a costs management order has been made, the bill must be accompanied by a breakdown comparing the costs claimed for each phase with the last approved or agreed budget. Precedent Q provides that comparison. It is often the first document a paying party reads, because it shows immediately where the claim exceeds the budget.

On a standard-basis assessment, the court will generally not depart from approved budgeted costs without good reason. If a phase has been exceeded, the bill should explain why. Incurred costs at the time of budgeting remain subject to assessment and are not approved by the costs management order.

The most frequent problems are inconsistent phase coding, time recorded under the wrong task, unexplained grade changes and narrative entries that do not describe the work. Exported time-recording data rarely fits the model cleanly; a costs draftsman has to review, recode and sometimes split entries so they reflect the litigation accurately.

Other issues include missing certificates, disbursements without supporting evidence and failure to separate costs covered by different orders. These points tend to appear in points of dispute and can reduce recovery or delay settlement. Careful drafting reduces the scope for argument at detailed assessment.

Start by gathering the orders, retainer and funding documents, the budget and any variations, the time-recording export and disbursement invoices. Agree who can answer questions about the file. Then map the work to phases before checking individual entries, so that structural issues are solved first.

Our free checklists help organise the material at the start. Where the budget was exceeded or the file involves several parties, involving a Costs Lawyer early helps decide how the bill should be presented and what explanations will be needed.

Electronic bills are equally useful to paying parties. Filtering by fee earner, phase or task quickly reveals duplication, senior grades doing routine work and phases where time escalated without explanation. Points of dispute can then target specific entries rather than making broad percentage objections.

For that reason, receiving parties should assume their bill will be interrogated line by line. Accurate coding and clear narratives are the best protection, and they make replies to points of dispute much quicker to prepare if objections are raised.