Costs Flashcards
What types of litigation costs are there?
- Solicitor-Client Costs
- Inter-party costs
- Non-party costs
What are Solicitor-Client Costs?
Costs constrained by retainer with likely shortfall.
What are Inter-party costs?
Actual figure for costs awarded by the court.
What are Non-party costs?
Costs where a non-party funds the litigation or controls/benefits from proceedings.
What is the general rule regarding costs?
Costs follow the event - the loser pays the cost of the winner.
This principle is a general rule in litigation regarding cost allocation.
What discretion does the court have regarding costs?
Complete discretion to consider parties’ conduct and issue success.
The court may evaluate how parties behaved during the litigation, including in alternative dispute resolution (ADR) efforts.
What are the two bases of assessment for costs payable?
- Standard Basis
- Indemnity Basis
What is the Standard Basis of cost assessment?
The court will allow costs which:
- have been proportionately and reasonably incurred
- are proportionate and reasonable in amount
- any doubt is resolved in favour of the paying party
This basis generally results in lower recoveries compared to the indemnity basis.
What is the Indemnity Basis of cost assessment?
The court will allow costs which:
- have been reasonably incurred
- and are reasonable in amount
- any doubt is resolved in favour of the receiving party
This basis applies particularly when one party’s conduct is disapproved of.
What factors determine if costs are proportionate?
- Sums in issue
- Value of non-monetary relief
- Complexity of litigation
- Additional work due to paying party’s conduct
- Wider factors like reputation or public importance
What is the time frame for complying with a costs order?
Must comply within 14 days of judgment or costs order certificate unless otherwise ordered by the court.
This time frame is standard unless the court specifies different terms.
What do fixed costs apply to?
- Uncontested disputes
- Enforcement proceedings
- Small claims
- Intermediate claims (up to the value of £100,000).
What determines the value of Fixed Costs?
The value of Fixed Costs depends on the ‘complexity band’ to which the claim applies (1, 2, 3, or 4) and factors such as:
- the nature of the claim
- money in dispute
- complexity of legal issues
- number of parties involved
- length of litigation process.
What sanctions can be applied regarding Fixed Costs?
Sanctions can include an uplift or reduction by 50% if a party is deemed to have acted unreasonably.
When do Fixed Costs apply?
Fixed Costs apply unless the court orders otherwise.
What are Assessed Costs?
Assessed Costs involve the court’s decision when parties cannot agree on the amount of costs one should pay to the other.
What are the two ways that assessed costs can be determined?
- Summary assessment
- Detailed assessment
What is Summary Assessment?
In Summary Assessment, parties must prepare statements of costs (preferably on Form N260) and file them at least 24 hours before the hearing. The court will review these and make a decision.
This is more commonly used than detailed assessment
What is Detailed Assessment?
In Detailed Assessment, the receiving party serves a notice of commencement and a detailed bill of costs on the paying party. Points of dispute must be served within 21 days.
What happens if parties cannot agree in Detailed Assessment?
If parties cannot agree, the receiving party should file a request for a detailed assessment hearing where a costs officer will determine the amount payable.
What are Non-Party Costs Orders?
Non-Party Costs Orders can be made against those who substantially control litigation or stand to benefit from the successful outcome of proceedings.
What is Qualified One Way Costs Shifting?
Qualified One Way Costs Shifting applies only to personal injury cases, where D cannot recover costs from the client unless certain conditions are met.
What conditions allow D to recover costs in Qualified One Way Costs Shifting?
D can recover costs if:
- The claim is found to be ‘fundamentally dishonest’
- The claim is struck out for having no reasonable grounds
- C failed to beat D’s P36 offer to settle.
What are Interim Costs Orders?
Interim Costs Orders are decisions regarding the allocation of costs during interim hearings.
