11. Costs + Part36

Question 1

Fast track

Answer 1

Fixed recoverable costs

Question 2

Intermediate track

Answer 2

Fixed recoverable costs

Question 3

When are costs awarded on indemnity basis?

Answer 3

Wrongful conduct (awarded after Day 22<–> Judgement)

Question 4

Non party costs order?

Answer 4

Default party cannot pay so go after someone with real interest in outcome e.g. sponsored party

Question 5

What is costs awarded on standard basis?

Answer 5

Per cost budget report

Question 6

What are fixed recoverbale costs costs awarded?

Answer 6

Complexity band

Question 7

When can you depart from costs budget?

Answer 7

Good reason e.g. no incurred costs or much less than expected

Question 8

Small claims costs awarded?

Answer 8

Cannot recover legal costs only disbursements

Question 9

How are costs of interim applications asssed?

Answer 9

Summarily (immediatley at end of hearing)

Question 10

Process of detailed assesment of multitrack costs

Answer 10

1. recieve notice of detailed assessment order
2. withn 3 months, serve notice of commencement (evidence of bills)
3. paying party has 21 days to dispute
4. recivieing party has 21 days to reply
5. recieving party files for assessment hearing within 3 motnhs

costs less than £75k - judge decides what is allowed

right to appeal within 21 days but must get adjusted figure of at least 20% otherwise need ot pay other parties costs

Question 11

Requirements for standard basis costs?

Answer 11

1. reasonably incurred (disallowed if not)
2. reasonable in amount (reduced if not)
3. proportionate to:
   
   • total sum
   • additional work generated
   • complecity

doubts resolved in favour of paying party

Question 12

Requirements for indemnity basis costs?

Answer 12

1. reasonably incurred (disallowed if not)
2. reasonable in amount (reduced if not)

doubts resolved in favour of recieving party

Question 13

Effect of disallowing/reducing costs?

Answer 13

Cannot recover full amount from paying party

Question 14

Why apply for security of costs order?

Answer 14

Defendant doesnt think C can pay costs owed + promise to set aside sums owed

Question 15

Grounds for security of costs order*

Answer 15

1. It is just to make it in the circumstances and
2. one of more of part 25 conditions apply

Question 16

Security of costs order - part 25 conditions?

Answer 16

1. C lives outside EU/UK
2. C has taken steps to make enforcement diffult
3. C is impecunious company

Question 17

What to show if claiming impecunious company?

Answer 17

Evidence of finances and assets

Question 18

What does court consider when deciding if it is ‘just’ to grant security of cost order?

Answer 18

1. D is likley to win at trial
2. If the court believes the small business has a good chance of winning, it may refuse to grant the security order, because that would deny them the chance to bring the claim at all.
3. C’s poor finances are becuase of D’s actions = no order
4. apply for order asap
5. C lives outside juridiction + unlikley to give security of assets

Question 19

Process for security of costs order

Answer 19

1. ask other party to volunatrily pay
2. if no, go to court, notice + witness staement
3. establish conditions + just + persuade them to exercise DISCRETION

Question 20

Valid Part 36 Offer:

Answer 20

• in writing
• state it is part 36
• relevant period is ≥21 days
• whole/part of claim
• include counterclaim?

Question 21

If claimant accepts within relevant period?

Answer 21

D pays standard/fixed from issue until acceptance

Question 22

If claimant accepts outside relevant period (late)?

Answer 22

D pays from issue until Day 22 + C pay from Day 22 until acceptance

Question 23

If D accepts late or within relevant period?

Answer 23

D pay C’s costs from issue until acceptance

Question 24

When must paying party pay?

Answer 24

Within 14 days otherwise seek judgement

Question 25

Claimant makes Part 36 offer + awarded at least advantageous outcome

Answer 25

D pays: * damages + interest (contract) AND ‘Extra damages’: * Damages up to £500k: 10% extra * Damages between £500k-£1million: 10% on first £50k + 5% up to £750k ‘Extra interest’ * Multi Track o Proceedings-- Day 21 (standard basis per cost budget report) o Day 22 ---Judgement (Indemnity basis + up 10% enhanced interest * Fast/Intermediate o Proceedings ----Day 21 (fixed recoverable costs + contract interest) o Day 22 --- Judgement (35% of difference between Day 22 and Judgment + up 10% enhanced interest) *

Question 26

Claimant makes Part 36 offer + awarded lower sum

Answer 26

No extra penalties apply – Defendant just pay damages and interest under contract

Question 27

DEFENDANT makes Part 36 offer + claimant wins + more advantageous than p36

Answer 27

valid to refuse because claimant got something better so no penalties apply

Question 28

Claimant makes Part 36 offer + loses

Answer 28

Claimant gets no damages Claimants pay defendant’s costs on: * Standard basis (multi track) * Fixed recoverable costs (fast/intermediate track)

Question 29

DEFENDANT makes Part 36 offer + claimant wins but less advantageous (split costs)

Answer 29

Defendant pays damages and interest under contract Extra damages: * Proceedings---Day 21: D pays Claimants fixed recoverable costs (fast or intermediate) or standard (multi-track) * Day 22 --- judgement: Claimant pay D’s fixed/standard basis costs + OWN COSTS from Day 22 --- judgement. Extra interest * Day 22 --- judgement: 1%/2% above base

Question 30

DEFENDANT makes Part 36 offer + claimant loses (disaster)

Answer 30

Pay D’s costs from issue until judgement + interest (under contract until Day 22 + from Day 22 ---- judgement 1%/2% above base rate)

Question 31

Unreasonable behaviour in intermediate track?

Answer 31

ask for its costs to be increased by an amount equivalent to 50% of the fixed recoverable costs which would otherwise be payable.

Question 32

Unreasonable behaviour in intermediate track?

Answer 32

ask for costs to be awarded on the indemnity basis.