Senior Costs Judge Rowley’s decision in JXX v Archibald marks a significant shift in how Medical Reporting Organisation (MRO) fees are treated in costs recovery.
The judgment departs from long-established authority and introduces a new approach that could materially affect MRO business models, medical expert witnesses and claimant access to medical evidence.
In this article, we summarise the key findings and explore their practical implications, drawing on insight from a senior barrister, a medical expert and an established MRO.
Key takeaways
- MRO fees are now treated as disbursements, not outsourced solicitor work.
- A 25% cap on recoverable mark-up is likely to become a benchmark.
- An appeal is pending, but in the interim this decision will carry persuasive weight.
- This decision and any appeal is likely to have a significant impact on MRO business models, expert witnesses and claimant access to medical evidence.
The previous position: The Stringer Cap
Until now, the leading authority on the recoverability of MRO fees was Stringer v Copley [2002]. That decision established what became known as the Stringer Cap, under which:
- MRO fees were recoverable provided they did not exceed the reasonable and proportionate cost of a solicitor undertaking the same work.
- MROs were required to distinguish between the expert’s fee and their own charges.
This approach was subsequently endorsed in the Claims Direct Test Cases (2003) and followed in later decisions, forming the basis for how MRO fees have been assessed for over two decades.
The new approach in JXX v Archibald
Judge Rowley’s judgment introduced several important changes.
1. MRO fees are disbursements
The court held that MRO work is largely administrative and cannot properly be characterised as solicitor work. Importantly, responsibility for the work lies with the expert, not the solicitor.
As a result, MRO fees should be treated as disbursements, not outsourced legal services.
Why this matters: This change fundamentally alters how those fees are assessed and what evidence MROs must provide to recover them.
2. A departure from the traditional Stringer Cap
Because MRO fees are now categorised as disbursements, Judge Rowley concluded that MROs are not required to provide the same level of detailed breakdown expected in a solicitor’s bill of costs.
Why this matters: This reduces the administrative burden on MROs but also shifts the way proportionality and reasonableness are evaluated.
3. A 25% cap on recoverable mark-up
Perhaps the most significant aspect of the decision is the introduction of a 25% cap on recoverable mark-up applied to expert fees. This is notably lower than the 30%–53% mark-ups commonly charged by MROs.
The court was not persuaded by arguments that higher mark-ups were justified by:
- market competition
- the operational realities of MRO businesses.
Why this matters: This creates immediate financial pressure on MROs operating above that level and is likely to drive disputes in costs assessments.
Status of the decision: First instance but influential
Although this is a first instance decision, it is expected to carry considerable weight.
As Nicola Shaldon, senior commercial barrister specialising in costs law (4 New Square), notes, it has significant “persuasive weight given the seniority of the costs judge”.
Both parties have appealed. The appeal from Premex focuses specifically on the 25% cap, described as “disappointing and concerning” for agencies whose business models depend on higher mark-ups.
Shaldon suggests that the appeal could provide much-needed clarity on:
- the proper approach to assessing MRO fees
- the wider policy considerations, including:
- MRO profitability
- their role in litigation
- and the impact on claimant access to expert evidence.
In the meantime, the 25% cap is likely to be relied upon by defendants as a benchmark in future costs assessments, unless compelling evidence justifies a higher figure.
Impact on medical experts
Some MROs have already responded by:
- increasing the fees they charge to experts
- introducing additional service charges that are passed on the expert.
Dr Duncan Dymond, consultant cardiologist and medical expert witness, notes that this has caused “great concern among experts”.
Potential consequences include:
- experienced experts refusing MRO instructions in favour of direct solicitor engagement
- experts raising their own fees
- reduced incentive for new experts to enter the field.
Impact on claimants
The implications for claimants are significant, both in the short and long term.
Short-term risk to their compensation
MRO markups are often higher than the 25% recoverable cap applied in JXX. If a costs judge applies a similar cap, the claimant might have to cover any shortfall from their personal injury damages.
Long-term risks
- Reduced access to the nationwide network of experts facilitated by MROs.
- Loss of deferred payment arrangements, which currently help fund medical evidence.
- Potential delays or barriers in obtaining expert reports.
As Shaldon highlights, “depending on the outcome of any appeal”, there is a real concern that this could ultimately affect access to justice.
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