Scottish Judicial Rate Increases By 22.8%: What It Means For Defenders’ Reserves In Personal Injury Cases

The hourly rate used in judicial accounts for work carried out by solicitors was last increased in 2023 when the value of the unit in the tables of charges in Act of Sederunt (Taxation of Judicial Expenses Rules) 2019 rose from £16.40 to £18 (from £164 to £180 per hour). The Act of Sederunt (Taxation of Judicial Expenses Rules) (Amendment) 2026 now increases the unit rate to £22.10 resulting in an hourly rate of £221.

How judicial costs are calculated 

When a party is found liable to pay the costs (known as ‘expenses’ in Scotland) of another party in Scottish court proceedings, those costs are usually quantified through a process known as taxation. Taxation is the formal legal process conducted by an Auditor of Court, who assesses, verifies, and quantifies the reasonable amount of legal costs, fees, and outlays owed to the receiving party after a case concludes. In preparation for taxation, the receiving party prepares a ‘judicial account’. Taxation is not required in every case. The costs are often agreed and settled by negotiation between the parties, prior to the cost of taxation being incurred.

A judicial account is generally made up of two components: fees for the work carried out by solicitors and outlays, being the actual expenses incurred in progressing the case, such as counsel’s fees (where they have been instructed) court fees, expert fees and the cost of recovering medical records.

Solicitors' fees are calculated by reference to tables of charges set out in the Act of Sederunt (Taxation of Judicial Expenses Rules) 2019, which attach a "unit" value to categories of work. Categories of work include being instructed to raise or defend a case; taking a precognition (witness statement); reviewing an expert report; preparing, reviewing, or opposing a motion, lodging productions, or reviewing another party’s productions; preparing or reviewing statements of valuation; or preparing for proof (trial). Hopefully, you get the idea. Any work that is required to be carried out by a solicitor in preparation for the pursuance of, or defence of a claim, attracts a unit value.

That unit value is then multiplied, using the current value of one unit (including an hourly rate for time-based work, like reviewing evidence recovered) to arrive at the fee recoverable for each item of work done. Because the unit rate underpins the calculation of the entire fee element of a judicial account, any change to it has a direct and immediate effect on the costs a successful party can recover.

The increase from 10 October 2026

The hourly rate used in judicial accounts for solicitors' work was last increased in 2023, when the unit value in the tables of charges rose from £16.40 to £18, producing an hourly rate of £180. That was an increase from 2019, of 9.8%.

The Act of Sederunt (Taxation of Judicial Expenses Rules) (Amendment) 2026 now increases the unit rate to £22.10, producing an hourly rate of £221. That is an increase of just shy of 23%, a significant jump, after a shorter period than the previous adjustment. The increase applies only to work carried out on or after 10 October 2026.

Likely impact for defenders and insurers

The qualified one-way costs shifting rules have meant that awards of costs against a pursuer are now rarely seen in personal injury litigation, even when the defender has been successful.

A near 23% increase in the hourly rate used to tax pursuers' judicial accounts will feed directly through to higher cost exposure wherever a pursuer succeeds. As it will only apply to work carried out after 10 October 2026, it may be some time before the full effect is felt. However, it does mean for claims that are yet to be raised, or for litigated claims that are unlikely to be resolved soon, the reserves held for the costs payable to the pursuer do need to be reviewed.

The increase only applies to the work carried out by solicitors, and not counsel’s or experts’ fees. That said, given the financial climate and the rate of inflation, it is not unreasonable to assume we will also see increases on the fees charged by counsel and experts.

That all said, the news is not entirely bad. On the occasions when a defender can argue for the disapplication of the costs shifting rules and secure an award of costs, then the amount of costs that can be recovered by the defender, will also increase.

To summarise, the practical consequences for those dealing with personal injury claims include:

Higher expenses/cost reserves: Reserving practices for cost exposure will need to be reviewed and increased across live claims, particularly for cases still at an early stage where the bulk of work will fall to be charged at the new, higher rate from 10 October 2026 onwards.

Greater weight to the timing of settlement and litigation strategy: Because the increase applies only to work done on or after 10 October 2026, there may be a short-term incentive to conclude straightforward cases, or agree expenses, before that date, where doing so is in the defenders’ interests. Conversely, for cases that will inevitably run past that date, the increase reduces the relative cost benefit of delay.

Focus on early resolution and tender strategy when appropriate: With higher costs, the financial incentive to resolve claims early, or to use tenders and judicial or extrajudicial offers effectively, becomes stronger. Defenders and their insurers may wish to revisit their approach to settlement strategy in defended claims considering the higher downside risk.

Resolution of claims pre-action if possible: The change to the unit charge has no impact on the costs available to a successful pursuer under the Compulsory Pre-Action Protocol. That therefore increases the gap between the sums that might have to be paid should the claim resolve pre-action, and the sums that might have to be paid should the claim litigate. With that in mind, economics may favour pre-action settlement. Particularly for claims with a modest value.

Scrutiny of pursuers' accounts of expenses remains important: While the unit rate itself is fixed by the Act of Sederunt, the number of units claimed for items of work, and whether work has been reasonably and necessarily incurred, remain matters for taxation. With each unit now worth more, the value of robustly negotiating pursuers' accounts or testing the account, if necessary, at taxation, also increases.

Careful analysis of claims spanning the changeover date: Those handling claims will need to ensure judicial accounts, and any expenses negotiations, properly apportion work between the pre- and post-10 October 2026 periods, so that the correct rate is applied.