One of the main differences between the Federal Rules of Civil Procedure and the Civil Procedure Rules of England and Wales is that England and Wales is a costs-shifting jurisdiction by default. That means that the winner can expect to get a significant contribution to litigation costs from the loser. This, theoretically at least, acts as a brake on unnecessary expenditure because all parties have a contingent interest in the others’ costs.
Much of the focus of Lord Justice Jackson’s reforms has been on quantifying and controlling the recoverable costs – parties can spend what they like (as long as they do not run up unnecessary costs for opponents) but are limited in what they can recover if they win. Although the budgetary constraints envisaged by Lord Justice Jackson have been emasculated in part by judges reluctant to sully their hands with questions of costs, eDisclosure costs remain subject to tight control, with parties required to cooperate to limit the scope of disclosure, to agree the tools and techniques to be used and to estimate the costs of managing disclosure (see my recent article Costs management shambles defies parody but case management still has teeth on this).
The US has a more ambivalent approach to costs-shifting, with variations between states and a distinction drawn between lawyer fees and eDiscovery costs. Judge Grimm suggested at Georgetown that we may see moves towards codification of the rules in a way which will put more parties at risk of having to pay their opponents’ costs, including (I assume) eDiscovery costs. Read the rest of this entry »