Costs I Flashcards
1
Q
- Who constitutes a costs officer
A
- Costs officer means
- Costs judge
- District judge
- An authorised court officer
2
Q
- What is the case where the losing side works under a ‘no win, no fee agreement’
A
- When a lawyer works under a “no win, no fee” agreement, you can still claim usual legal costs from the losing party as set out in the rules, regardless of the payment arrangement between the client and their lawyer.
3
Q
- Courts discretion as to costs
A
- Court has discretion as to
- whether costs are payable by one party to another;
- the amount of those costs; and
- when they are to be paid
4
Q
- If the court do decide to make an order about costs what is the general rule
A
- the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but
- the court may make a different order
5
Q
- What proceedings to general rule about costs not apply to
A
- proceedings in the Court of Appeal on an application or appeal made in connection with proceedings in the Family Division; or
- proceedings in the Court of Appeal from a judgment, direction, decision or order given or made in probate proceedings or family proceedings
6
Q
- In deciding what order (if any) to make about costs, the court will have regard to all the circumstances, including—
A
- the conduct of all the parties;
- whether a party has succeeded on part of its case, even if that party has not been wholly successful; and
- any admissible offer to settle made by a party which is drawn to the court’s attention, and which is not an offer to which costs consequences under Part 36 apply
7
Q
- Orders which the court may make include an order that a party pay
A
- Orders which the court may make under this rule include an order that a party must pay
- a proportion of another party’s costs;
- a stated amount in respect of another party’s costs;
- costs from or until a certain date only;
- costs incurred before proceedings have begun;
- costs relating to particular steps taken in the proceedings;
- costs relating only to a distinct part of the proceedings, and
- Because this may be difficult they must first see if the proportion or costs from certain date may be more appropriate first
- interest on costs from or until a certain date, including a date before judgment.
*
8
Q
- Procedure where the court orders a party to pay costs subject to detailed assessment
A
- Where the court orders a party to pay costs subject to detailed assessment, it will order that party to pay a reasonable sum on account of costs, unless there is good reason not to do so.
9
Q
- Time for complying with an order for costs
A
- party must comply with an order for the payment of costs within 14 days of—
- the date of the judgment or order if it states the amount of those costs;
- if the amount of those costs (or part of them) is decided later in accordance with Part 47, the date of the certificate which states the amount; or
- in either case, such other date as the court may specify.
10
Q
- Courts costs powers in relation to misconduct
A
- The court may
- disallow all or part of the costs which are being assessed OR
- order the party at fault or that party’s legal representative to pay costs which that party or legal representative has caused any other party to incur
- If the court makes such an order against parties’ legal reps and the party is not present when the order is made, then the party’s legal representative must notify that party in writing of the order no later than 7 days after the legal representative receives notice of the order.
11
Q
- Set off
A
- Where a party entitled to costs is also liable to pay costs, the court can either
- Set off the amount and make them pay the balance OR
- Delay them being paid until they have paid the amount they are liable to be paid
12
Q
- Qualified one way costs shifting applies to which claims
A
- This section applies to proceedings which include a claim for damages
- For personal injuries
- under the Fatal Accidents Act 1976; or
- which arises out of death or personal injury and survives for the benefit of an estate by virtue of section 1(1) of the Law Reform (Miscellaneous Provisions) Act 1934
- Does not apply to applications for pre action disclosure
13
Q
- Effect of qualified one way costs shifting
A
- Where there is an order for costs for both the Claimant and the Defendant, the Defendant will be able to enforce its costs against damages, interest and the Claimant’s costs without permission from the Court after the conclusion of proceedings if they successfully defend the claim.
- can only be enforced after proceedings are concluded and costs have been assessed or agreed
14
Q
- Exceptions to QOCS where permission not required
A
- This means they can get all their costs not just set then off against claimants costs, award, interest
- Orders for costs made against the claimant may be enforced to the full extent of such orders without the permission of the court where the proceedings have been struck out on the grounds that—
- the claimant has disclosed no reasonable grounds for bringing the proceedings;
- the proceedings are an abuse of the court’s process; or
- the conduct of—
- the claimant; or
- a person acting on the claimant’s behalf and with the claimant’s knowledge of such conduct,
- is likely to obstruct the just disposal of the proceedings.
15
Q
- Exceptions to QOCS where permission is required
A
- This means they can get all their costs not just set then off against claimants costs, award, interest
- Orders for costs made against the claimant may be enforced to the full extent of such orders with the permission of the court where the claim is found on the balance of probabilities to be fundamentally dishonest.
- Orders for costs made against the claimant may be enforced up to the full extent of such orders with the permission of the court, and to the extent that it considers just, where—
- the proceedings include a claim which is made for the financial benefit of a person other than the claimant or a dependant within the meaning of section 1(3) of the Fatal Accidents Act 1976 (other than a claim in respect of the gratuitous provision of care, earnings paid by an employer or medical expenses); or
- a claim is made for the benefit of the claimant other than a claim to which this Section applies.
16
Q
- Difference between costs claimed and costs budgets
A
- If there is a difference of 20% or more between the costs claimed by a receiving party on detailed assessment and the costs shown in a budget filed by that party, the receiving party must provide a statement of the reasons for the difference with the bill of costs.
- If a paying party
- claims to have reasonably relied on a budget filed by a receiving party; or
- wishes to rely upon the costs shown in the budget in order to dispute the reasonableness or proportionality of the costs claimed,
- the paying party must serve a statement setting out the case in this regard in that party’s points of dispute
- Where it appears to the court that the paying party reasonably relied on the budget, the court may restrict the recoverable costs to such sum as is reasonable for the paying party to pay in the light of that reliance, notwithstanding that such sum is less than the amount of costs reasonably and proportionately incurred by the receiving party.
- Where it appears to the court that the receiving party has not provided a satisfactory explanation for that difference, the court may regard the difference between the costs claimed and the costs shown in the budget as evidence that the costs claimed are unreasonable or disproportionate.
17
Q
- Fees of counsel when it comes to costs
A
- When making an order for costs the court may state an opinion as to whether or not the hearing was fit for the attendance of one or more counsel, and, if it does so, the court conducting a detailed assessment of those costs will have regard to the opinion stated.
- The court will generally express an opinion only where—
- the paying party asks it to do so;
- more than one counsel appeared for a party; or
- the court wishes to record its opinion that the case was not fit for the attendance of counsel
18
Q
- The costs which are within the courts discretion + reasons for costs + indemnity principles
A
- the costs that shall be in the discretion of the court are “the costs of” and “the costs incidental to” all proceedings
- It is clear that costs incurred prior to proceedings are capable in principle of being recoverable as costs in the proceedings
- There is a general principle that the costs of a claim do not include costs incurred by a party in seeking funding either for the prosecution or for the defence of that claim
- Reasons for costs
- The Court of Appeal has repeatedly stated that, when making an order for costs, judges should clearly state their reasons, particularly where the costs incurred are disproportionate to the amount in issue
- where counsel are not sure they should seek from the judge a note of the reasons for the order
- The indemnity principle
- A successful party cannot recover a sum in excess of their liability to their own solicitor
19
Q
- Issue based orders
A
- where a party successful overall has been unsuccessful on an issue (or issues), being an issue which that party raised, pursued or contested, a court
- (1) should consider adopting an issue-based approach, and
- (2) in deciding what order to make in relation to that issue (or issues) may decide
- (a) that party should be deprived of his costs of that issue, or a proportion of those costs, or those costs from or until a certain date; or even
- (b) that that party should pay the costs of the otherwise unsuccessful party on that issue, or a proportion of those costs, or those costs from or until a certain date.
20
Q
- The general rule - successful and unsuccessful parties
A
- Where there is no clear winner, then the presumption in favour of the general rule does not apply
21
Q
- Where there is success both ways
A
- Where there is a claim and a counterclaim and each party succeeds on one the usual order is that each party has the costs of the claim in which they succeeded.
- However in most cases it will be desirable that the judge should consider whether a special order should be made as to costs “because the issues are often very much interlocked, and the usual order does not always give a just result”.
- A counterclaim may be by way of a defence to the claim, raising the same issues as the claim, or it may be a cross-action, raising unrelated issues.
- In most cases therefore an order giving the overall winner a proportion of its costs may be preferable to orders for costs going in opposite directions
22
Q
- Unreasonable refusal to agree to ADR
A
- the court’s discretion as to costs includes power to deprive a successful party of some or all of its costs on the ground that it has refused to agree to ADR,
- the burden is on the unsuccessful party to show why, for reason of such conduct, there should be a departure from the general rule
- such departure is not justified unless it is shown that the successful party acted unreasonably in refusing to agree to ADR
- in determining whether the successful party conducted itself unreasonably the court should have regard to all the circumstances of the particular case
- a failure to engage on the matter of ADR, even if unreasonable, does not automatically result in a costs penalty, but is simply a factor to be taken into account by the judge when exercising his costs discretion,
23
Q
- Party conduct before the proceedings
A
- conduct of the parties includes conduct “before, as well as during, the proceedings
*
24
Q
- Bullock Order
A
- Where in the same proceedings a claimant (C) sues two defendants (D1 and D2) and succeeds against one only (say D1) there are two successful parties (C and D2) and two unsuccessful parties (C and D1)
- A strict application of the general rule as to costs would require that C should pay D2’s costs and that D1 should pay C’s costs.
- But the court’s can order that the costs payable by C to D2 should be recoverable by C from D1 as part of C’s costs in the proceedings.
- So C pays to D2 and recovers from D1.
- Such an order is known as a “Bullock order”
25
27. Sanderson Orders
* Where in the same proceedings a claimant (C) sues two defendants (D1 and D2) and succeeds against one only (say D1) there are two successful parties (C and D2) and two unsuccessful parties (C and D1)
* A strict application of the general rule as to costs would require that C should pay D2’s costs and that D1 should pay C’s costs.
* The court may adopt a simpler approach and order that D1 (the unsuccessful defendant) should pay the costs of D2 (the successful defendant) directly to D2.
* Such an order is known as a “Sanderson order
26
28. Liability to pay for an ADR process
* Each party will be liable to pay their own costs and expenses in relation to an ADR process, unless some other agreement is reached,
* While cost recoverability is not the norm for ADR, there are ways in which costs can be shifted in and in relation to the use of ADR. This can be done:
* as part of a settlement reached in negotiation or mediation
* through the use of a Part 36 offeR
* in an adjudicative ADR process as part of an award made by a third party, if the third party has been given power to award costs by agreement
* if a case is litigated, through the general powers of the court in relation to costs where there has been a failure to make reasonable use of ADR
* if proceedings have been issued and the action is discontinued the claimant will be liable for the defendant’s costs
27
29. Procedure for assessing costs
* Where the court orders a party to pay costs to another party (other than fixed costs) it may either—
* make a summary assessment of the costs; or
* order detailed assessment of the costs by a costs officer,
* An order for costs will be treated as an order for the amount of costs to be decided by a detailed assessment unless the order otherwise provides.
28
30. Time when detailed assessment of costs may be carried out
* The general rule is that the costs of any proceedings or any part of the proceedings are not to be assessed by the detailed procedure until the conclusion of the proceedings, but the court may order them to be assessed immediately
29
31. No stay of detailed assessment where there is an appeal
* Detailed assessment is not stayed pending an appeal unless the court so orders.
30
32. Summary assessment of costs
* Whenever a court makes an order about costs which does not provide only for fixed costs to be paid the court should consider whether to make a summary assessment of costs.
* The general rule is that the court should make a summary assessment of the costs—
* at the conclusion of the trial of a case which has been dealt with on the fast track, in which case the order will deal with the costs of the whole claim; and
* at the conclusion of any other hearing, which has lasted not more than one day, in which case the order will deal with the costs of the application or matter to which the hearing related. If this hearing disposes of the claim, the order may deal with the costs of the whole claim,
* unless there is good reason not to do so, for example where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily
31
33. Duty of parties and legal representatives in relation to summary assessment of costs
* Each party who intends to claim costs must prepare a written statement of those costs showing separately in the form of a schedule—
* the number of hours to be claimed;
* the hourly rate to be claimed;
* the grade of fee earner;
* the amount and nature of any disbursement to be claimed, other than counsel’s fee for appearing at the hearing;
* the amount of legal representative’s costs to be claimed for attending or appearing at the hearing;
* counsel’s fees; and
* any VAT to be claimed on these amounts
* The statement of costs must be filed at court and copies of it must be served on any party against whom an order for payment of those costs is intended to be sought as soon as possible and in any event—
* for a fast track trial, not less than 2 days before the trial; and
* for all other hearings, not less than 24 hours before the time fixed for the hearing
