Costs II

Question 1

1. Basis of assessment for costs

Answer 1

• Will either be standard basis or indemnity basis, but in either case the court will not allow costs which have been unreasonably incurred or are unreasonable in amount

Question 2

2. Amount of costs to be assessed on the standard basis

Answer 2

• Court will disallow or reduced costs which are disproportionate to the matters in issue, even if they are reasonably incurred
• Court will resolve any doubt which it may have as to whether costs were reasonably and proportionately incurred or were reasonable and proportionate in amount in favour of the paying party

Question 3

3. Amount of costs to be assessed on the indemnity basis

Answer 3

• Court will only disallow costs which it find to be
• Unreasonably incurred or
• Unreasonable in amount

Question 4

4. If the court does not indicate which basis the costs are to be assessed or give an alternative basis

Answer 4

• Its standard basis

Question 5

5. Costs incurred a proportionate if they bear a reasonable relationship to

Answer 5

• Costs incurred are proportionate if they bear a reasonable relationship to—
• the sums in issue in the proceedings;
• the value of any non-monetary relief in issue in the proceedings;
• the complexity of the litigation;
• any additional work generated by the conduct of the paying party;
• any wider factors involved in the proceedings, such as reputation or public importance; and
• any additional work undertaken or expense incurred due to the vulnerability of a party or any witness.

Question 6

6. Where the amount of a solicitor’s remuneration in respect of non-contentious business is regulated by any general orders made under the Solicitors Act 1974

Answer 6

• Where the amount of a solicitor’s remuneration in respect of non-contentious business is regulated by any general orders made under the Solicitors Act 1974, the amount of the costs to be allowed in respect of any such business which falls to be assessed by the court will be decided in accordance with those general orders rather than this rule and rule 44.4.

Question 7

7. Court will also have regard to … when deciding costs value

Answer 7

• The court will also have regard to—
• the conduct of all the parties, including in particular—
• conduct before, as well as during, the proceedings; and
• the efforts made, if any, before and during the proceedings in order to try to resolve the dispute;
• the amount or value of any money or property involved;
• the importance of the matter to all the parties;
• the particular complexity of the matter or the difficulty or novelty of the questions raised;
• the skill, effort, specialised knowledge and responsibility involved;
• the time spent on the case;
• the place where and the circumstances in which work or any part of it was done; and
• The receiving parties last approved or agreed budget

Question 8

8. When is making of costs on the indemnity basis appropriate

Answer 8

• The making of a costs order on the indemnity basis would be appropriate in circumstances where:
• (1) the conduct of the parties or
• (2) other particular circumstances of the case (or both) was such as to take the situation “out of the norm” in a way which justifies an order for indemnity costs

Question 9

9. Payment on account of costs

Answer 9

• 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”.
• The object of the rule is to enable a receiving party to recover part of his expenditure on costs before the possibly protracted process of carrying out a detailed assessment