Cost budgeting has long been a routine step in litigation, but recent decisions from the High Court suggest the judiciary is taking a far more critical look at how parties approach it.
In three judgments handed down in 2024 and early 2025 — Worcester v Hopley, Jenkins v Thurrock Council, and GS Woodland Court GP 1 Ltd & Anor v RGCM Ltd & Ors — the Courts made it clear that ‘costs in the case’ is no longer a safe assumption.
Poorly thought-out or inflated budgets, especially when parties fail to respond to red flags or opportunities to negotiate, can now result in real costs consequences.
Each case involved a party putting forward a budget that the Court ultimately found to be unrealistic, disproportionate, or poorly reasoned. And in each, the Court exercised its discretion to make specific costs orders — departing from the more traditional, and often presumed, “costs in the case” approach.
These cases collectively serve as a reminder that cost budgeting is no longer just a procedural tick-box. It’s a substantive part of litigation that requires care, judgment, and responsiveness.
Worcester v Hopley: A wake-up call
In Worcester v Hopley [2024] EWHC 2181 (KB), the Claimant’s budget came under serious scrutiny. The Court approved estimated costs of £159,675, down from £342,263 — a reduction of over 53%. Despite being given an opportunity to revise the budget after the Case Management Conference (CMC), the Claimant’s revised figures still failed to engage with the proportionality of the case or reflect a realistic allocation of work across the team.
Master Thornett criticised the lack of delegation and heavy reliance on senior fee earners, noting that the Claimant’s solicitors appeared to have allocated partner-level time to almost every phase of the litigation.
Unsurprisingly, the Court rejected the notion that this was an ordinary budgeting exercise deserving of a ‘costs in the case’ order.
The result was a warning shot to practitioners:
- No costs were allowed for the budgeting hearing itself;
- The Claimant was ordered to pay the Defendant’s costs of a subsequent hearing;
- The Claimant’s recoverable costs of budget preparation were reduced by 15%.
The Court was clear: parties cannot proceed to a separately listed budgeting hearing with unrealistic figures and expect to escape consequences.
Jenkins v Thurrock Council: Ignoring the warnings
A month later, in Jenkins v Thurrock Council [2024] EWHC 2248 (KB), a similar pattern unfolded. This was a personal injury case in which the Claimant’s original budget approached £1.2 million. Even after revisions, it remained over £944,000 — more than double the Defendant’s figure.
Once again, Master Thornett expressed concerns about the proportionality of the Claimant’s budget at the CMC. The Defendant had also flagged issues through its Precedent R. Upon listing the CCMC, the Court issued its standardised King’s Bench Division order, giving the parties an opportunity to revise their budgets where necessary and pursue further negotiations. Despite this, the Claimant failed to engage meaningfully or make any substantial adjustments. Negotiations stalled, and the hearing went ahead.
The Court deferred budgeting of the Trial and ADR phases, considering the Claimant’s figures speculative and unsupported at that stage of the litigation. Disclosure costs were also highlighted as significantly disproportionate.
In the end, the Claimant was ordered to pay the Defendant’s costs of the Costs Management Hearing. The Claimant’s own budgeting costs were reduced by 35%.
The message was clear: opportunities to reflect and negotiate should not be ignored — doing so may well lead to financial consequences.
GS Woodland Court: Overbudgeting at scale
The third case, GS Woodland Court GP 1 Ltd & Anor v RGCM Ltd & Ors [2025] EWHC 285 (TCC) (17 January 2025), concerned a high-value construction dispute involving alleged fire safety defects. The Claimants submitted a budget of £8.74 million, later reduced to £7.37 million, and finally cut down further to £4.21 million during the hearing itself. Much of that reduction came from conceding nearly £1 million in costs related to reply witness statements and expert reports — work for which there had been no Court order.
The Court took issue not only with the headline figures, but also with the way they had been reached. Grade A fee earners were charged at over £1,000 p/h, well above guideline rates, with no meaningful justification offered. Many of the time estimates were described as implausible. Justice Constable acknowledged that the claim was complex, but reiterated that complexity alone does not justify excessive costs.
Referencing the earlier decisions in Worcester and Jenkins, the Court found that the Claimants had crossed the line in their approach to budgeting. D2, D3, and D4/D5 were awarded their reasonable costs of attending the hearing.
The Claimants were denied their own costs of the hearing, and the remaining Defendants, although supportive of the application, were not awarded costs due to procedural limitations.
Even in high-value litigation, the Court made it clear that budgeting must be rooted in realism and supported by clear rationale.
Key takeaways for practitioners
These three judgments highlight a starting shift in the Courts’ approach to budgeting — and a growing expectation that parties treat it as a serious and considered exercise:
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‘Costs in the case’ is not a given.
Courts are now actively looking at parties’ conduct in costs budgeting, and unrealistic or excessive budgets can result in specific costs orders.
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Engage early and revise where appropriate.
When the Court or an opponent flags issues with your budget, you must engage meaningfully. For claims that have the interim period between a CMC and budgeting hearing, note that it is not just administrative space — it’s your opportunity to revise/negotiate and most importantly avoid adverse orders!
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A realistic approach matters.
Budgets must reflect what is genuinely required. Overreaching on rates, hours or seniority of fee earners can (and often will) be penalised.
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Conduct will be scrutinised under CPR 44.2.
The budgeting process is not immune from scrutiny on conduct grounds. The Court will take a rounded view of how parties have approached the process.
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The value of a claim doesn’t justify everything.
Proportionality remains central. A multi-million-pound claim doesn’t give a blank cheque — especially where the work proposed lacks structure or justification.
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Know your judge.
Judicial temperament matters. Master Thornett, for example, has built a reputation for taking a structured and disciplined approach to costs budgeting. Understanding your judge’s likely stance can and should inform how you prepare your budget.
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Don’t fear the process.
These cases aren’t about discouraging Claimants — quite the opposite. A well-prepared, proportionate budget can still provide strong protection. Having an experienced costs lawyer or professional involved is now more important than ever.
Conclusion
These decisions mark a starting shift in how the Courts are dealing with cost budgeting.
Practitioners should no longer assume the budgeting exercise will be rubber-stamped — or that ‘costs in the case’ is a default position. It would not be surprising to see more judgments of this kind emerging.
Done properly, budgeting remains an invaluable part of the litigation toolkit. But done poorly, it risks not just disallowance — but adverse orders.
The message from the Courts is simple: budget responsibly, engage early, and be prepared to justify every pound.
