Navigating the complexities of legal cost budgeting can be challenging. At DeNovo, our team of expert costs lawyers and costs draftsmen specialise in providing comprehensive support for all aspects of the costs budgeting process. From preparing Precedent H cost budgets to drafting budget discussion reports (Precedent R) and managing claims for budget changes (Precedent T), we are here to ensure your litigation costs are managed efficiently and effectively. Contact us today to discuss your needs and learn more about our services and pricing.
A Precedent H cost budget is a detailed document required under Annex A of Practice Direction 3D – Costs Management. It outlines a party’s incurred and anticipated legal costs, ensuring transparency and control over litigation costs. The costs budgeting process allows the court to set limits on future recoverable costs, safeguarding parties from excessive liabilities. Costs incurred up to the date of the costs management hearing are accounted for separately from projected future costs.
Precedent H is mandatory in most Part 7 multi-track cases with a monetary value below £10 million. It may also be required in higher-value cases if directed by the court. Exceptions apply only in specific circumstances outlined in a Costs Management Order (CMO). Failure to file a costs budget when required can result in significant disadvantages, as per CPR 3.14, which limits recoverable costs to court fees only unless the court orders otherwise.
A Precedent H cost budget must provide a phase-by-phase breakdown of incurred and estimated future costs, typically covering the following stages:
The budget must be filed and served 21 days before the first CMC. Accurate and realistic estimates are crucial, as adjustments to the budget are generally not permitted once approved by the court.
Under CPR 3.14, failing to file a costs budget when required can have serious consequences. The default position is that the party will be limited to recovering only the applicable court fees. This rule underscores the importance of complying with the costs budgeting process to avoid significant financial disadvantages.
Following the exchange of Precedent H budgets, parties engage in costs budget negotiations to try to resolve disputes and agree on figures for each phase. A Precedent R budget discussion report is prepared, highlighting agreed and disputed figures along with the reasons for disagreement. This report must be filed seven days before the CMC and plays a critical role in streamlining negotiations and avoiding contested hearings.
Incurred costs can only be contested at the detailed assessment stage after the case concludes. During the costs management process, the judge will not assess incurred costs but may comment on them.
At DeNovo, we pride ourselves on our expertise in legal cost management. Our team of costs lawyers and costs draftsmen offers:
We assist our clients to navigate the costs budgeting process confidently, ensuring compliance with court requirements and mitigation of financial risks.
Our team at DeNovo is here to provide the expertise and support you need at every stage of the litigation process. Contact us today to discuss your cost management requirements.
Afqar Dean is a leading legal costs specialist with over 30 years’ experience advising on high-value and complex disputes across multiple jurisdictions, including England and Wales, the Dubai International Financial Centre, Jersey, and British Overseas Territories.
He has acted on some of the UK’s most significant commercial litigation cases, representing and advising an extraordinary range of clients — from multinational corporations and major law firms to high-profile individuals, including political figures, members of royal families, sports stars, and entertainers.
Afqar’s expertise covers all aspects of contentious costs, including costs budgeting, assessments, solicitor–client disputes, professional negligence claims, and costs issues in international arbitration. He is also highly experienced in auditing legal costs, ensuring compliance, accuracy, and financial transparency for clients.
Among the first practitioners to qualify as a regulated Costs Lawyer, Afqar holds full rights of audience in costs proceedings. He is also a training provider, delivering bespoke seminars and education programmes for law firms and legal teams. A strong advocate for diversity and social mobility within the profession, Afqar is committed to widening access and opportunity in legal practice.
Education/admissions
Afqar is involved in the firm's diversity initiatives and a keen advocate for social mobility and opportunities for all.
Afqar was amongst the first in our profession become a regulated Costs Lawyer. He enjoys rights of audience in relation all costs proceedings.
Afqar is also an accredited training provider.
Michael Heslin is a Costs Draftsman with over 25 years’ experience acting in some of the most substantial and complex costs disputes in the UK. He co-founded DeNovo in 2004 and has since built it into one of the country’s leading independent costs consultancies, trusted by top UK and international law firms, insurers, and private clients.
Michael has personally prepared or defended more than 100 multi-million-pound costs claims, including several of the largest to come before the Senior Courts Costs Office. His experience spans high-value commercial litigation, intellectual property disputes, clinical negligence claims, and solicitor-client assessments. Notable projects include preparing Kuwait Airways’ £40M+ costs claim following the longest-running case in the history of the Commercial Courts, major pharma and telecoms patent litigation costs cases involving household-name multinationals, and acting in the Excalibur Ventures case — which included a landmark decision on costs and litigation funding.
Alongside his fee-earning practice, Michael has extensive management and mentoring experience. At DeNovo he has trained and led teams of costs lawyers and consultants, overseeing projects of prodigious scale. He has also provided seminars and training to leading law firms, blogged extensively on developments in costs law, and acted as an expert witness in costs litigation
Michael’s academic credentials are exceptional within the profession. He holds an LL.B (Hons), an LL.M (Distinction) focused on commercial litigation, and a PhD in Law from the University of East Anglia, awarded in 2024 for a thesis on responsibility theory and enterprise liability. He is also currently undertaking further postgraduate study in Competition and Regulatory Policy at the internationally renowned Centre for Competition Policy, reflecting his ongoing commitment to advanced legal and policy research.
Clients value Michael for his combination of technical precision, strategic insight, and clear communication. Whether working on behalf of paying or receiving parties, he brings authority, creativity, and a results-driven approach to the resolution of costs disputes.
Experience and notable cases
Kuwait Airways Corporation (KAC) –v- Iraqi Airways Company (IAC) – Following the longest running commercial case in the history of the English courts I prepared KAC’s massive costs claim, one the largest ever to reach the doors of the Senior Courts Costs Office. Legal costs claim of >£40M.
Pharma patent litigation – I was instructed by a leading global law firm on behalf of the successful parties in patent infringement and revocation proceedings involving some of the world’s largest pharmaceutical companies. Legal costs claim of >£5M.
Telecoms patent litigation – I was instructed by a top tier specialist firm of patent litigators to prepare various complex costs statements following trials and appeals involving some of the world’s largest technology corporations. Legal costs claim of >£10M.
High-profile costs claim following failed £100M civil recovery proceedings – instructed by a market leading international litigation team acting for a foreign citizen whose worldwide assets were subject of a civil recovery claim brought by the National Crime Agency (NCA). My team and I prepared a number of high value interrelated claims for costs on behalf of the successful party . Legal costs claim of >£5M.
Excalibur Ventures v Texas Keystone – The case generated several decisions of wider importance in the legal costs field (relating to security for costs, indemnity costs, and the availability of a non-party costs order against professional funders – a point on which the Association of Litigation Funders also intervened). I prepared the successful party's costs breakdowns and provided witness statements in support of its security for costs applications. Following the conclusion of the substantive litigation I prepared the defendant’s £20M> costs breakdown.
Challenge to remuneration and expenses of joint administrators – instructed by a market leading international litigation team: I was instructed to prepare a detailed challenge to the charges of a global financial consultancy and their advisers (including two high-profile international law firms), in connection with the administration of a UK energy supplier. The application for assessment of fees and expenses of >£5M under the Insolvency Act 1986 was the first significant challenge of its kind in 20 years.
Education
LLB (Hons) – University of London (1994)
LLM (Distinction) – University of East Anglia (2018)
PhD (law) - University of East Anglia (2024)
Professional and research interests: Costs law and practice, litigation funding, responsibility theory, vicarious liability, products liability, litigation practice, philosophical foundations of tort law. My doctoral thesis examined relationships between (pre-moral, pre-legal) outcome responsibility and strict tortious obligations of repair. Time permitting, future research output will address aspects of costs law and practice, third party litigation funding, as well as approaches to responsibility for harm caused by intelligent products (for ‘algorithmic accidents’).
