Costs Flashcards
What is the usual costs rule in civil litigation?
“Costs follow the event” - the unsuccessful party pays the successful party’s costs
What is taken into account when the court are making an order for costs?
The parties’ conduct, in particular if any relevant pre-action protocols have been followed
CPR Part 44 states that costs are proportionate if they bear a reasonable relationship to which five things?
The sums in issue / the value of any non-monetary relief / the complexity of the litigation / any additional work generated by the conduct of the paying party / wider factors such as reputation or public importance
What could guarantee proportionality in P.I cases?
(the increasing provision for) fixed costs
What allows the court to control costs and keep focus on proportionality in the multi track?
Costs budgets
Why may costs be reduced under CPR?
If they are disproportionate to the sums in issue, even if they were incurred reasonably.
What happened in the case of BNM v MGN Limited [2016] regarding proportionality?
The court reduced the bill already addressed as reasonably by half
What happened in the case of May & Another v Wavell Group plc & Another [2017] regarding proportionality?
The judge found the claimant’s reasonable costs were just under £100,000 but reduced to £35,000 on basis of proportionality. On appeal, judge increased to £75,000.
What was stressed by HHJ Dight in May v Warrell Group?
The proportionality tests should not be used to reduce reasonable costs down to a “rough and ready but proportionate amount”. Specific factors of CPR 44.3(5) should be used to determine whether there is a reasonable relationship between them
What does Qualified One Way Costs Shifting provide in PI claims? (QOCS)
The claimant doesn’t have to pay the defendant’s costs if the claim fails but the defendant must pay the claimant’s costs as usual if the claim succeeds (subject to exceptions) so no need for ATE insurance
What is the theory behind the fact that defendant insurers never recover their costs in RTA claims due to QOCS?
That the disadvantage is outweighed because they no longer pay ATE premiums if they lose
What happens if a claimant is found to be fundamentally dishonest in cases with QOCS?
They will lose the protection, and the defendant can potentially obtain a costs order against them.
What is the general rule for costs in the small claims track?
Legal fees are not recoverable, the only costs ordered will be fixed issue costs, court fees, witnesses expenses and expert’s fees to a fixed limit
How is a summary assessment of costs (fast track) carried out and when?
The court will determine the costs payable at the end of a hearing. Generally, the court will summarily (immediately) assess costs at the conclusion of the fast track trial or hearing unless fixed costs apply.
When is a detailed assessment of costs (multi track) conducted and what does it involve?
Conducted after proceedings have concluded and takes several months to complete. Involves fully particularised bill of costs, formal written objections and responses. Parties are tied to their costs budgets. Provisional assessment is carried out by court without parties for bills up to £75,000.
Part 7 multi track claims must be submitted via electronic process with Precedent S. What six things make up the contents of the Precedent S?
Narrative, chronology, charging orders, details of funding, summary of costs claimed, comparison with last agreed or approved budget
What are the two bases of costs assessment?
Standard and indemnity
Describe costs assessed on a standard basis.
Most common method. Court will only allow proportionate costs. Any doubts as to whether costs where incurred reasonably and proportionately are resolved in favour of the paying party.
Describe costs assessed on an indemnity basis.
Less common, usually imposed to penalise the defendant in some way. There is no reference to proportionality and any doubts are resolved in favour of the receiving party.
How and when is a detailed assessment of costs commenced?
It must be commenced within 3 months of the judgment or order granting the party its costs under Part 47. An N252 is completed and a fee is paid.
What is the procedure for a detailed assessment (challenging a bill)? (6 steps)
Receiving party serves N252 within 3 months of costs order / Paying party serves points of dispute within 21 days / 21 days from this receiving party serves points of reply / within 3 months of expiry date to commence detailed assessment proceedings, receiving party files request for detailed assessment / Court undertakes provisional assessment within 6 weeks without parties to decide items allowed / in 21 days parties can request date for oral hearing.
What happens if a party fails to achieve an adjustment in their favour by 20% after detailed assessment procedure?
They will be ordered to pay the hearing costs.
Who enforces a judgment if the defendant doesn’t pay in time?
The claimant
Under which Part of CPR can a creditor acquire more information about a debtor’s financial position (to decide the enforcement method)?
Part 71
