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23. Costs
Includes:
- General Rule (CPR 44);
- Assessment of Costs;
- Time-Limits;
- One-way Cost Shifting;
- Cost Budgets (CPR 3);
- Effect of Cost Budgets on Cost Orders (PD 44);
- Sanderson and Bullock Orders
General Rules about Costs
44.2 The court has the discretion to decide:
(a) Whether costs are payable by one party to another;
(b) The amount of these costs; and
(c) When they are to be paid.
If the court does decide to make an order about costs:
the general rule is that the unsuccessful party will be ordered to pay the costs
of the successful party, however, the court may divert from this.
In diverting from this, the court can order that a party pay:
(a) A proportion of another party’s costs;
(b) A stated amount of another party’s costs;
(c) Costs for a certain period;
(d) Costs incurred prior to proceedings;
(e) Costs for certain steps in proceedings;
(f) Interest.
- The court will only consider interest if the others are inappropriate.
When making a decision the court will regard:
(a) The conduct of the parties;
‘Conduct’ includes:
o Following Pre-action Protocols prior to and Practice Directions
during proceedings;
o Whether it was reasonable for a party to raise, pursue, or
contest a particular issue and the manner in which they did so;
o Whether a claim was exaggerated.
(b) Whether a party has succeeded on part or on the whole of the case;
(c) Any offers to settle made.
The court may order costs be paid subject to assessment. If it does so, the party
should pay a reasonable sum to the account of costs.
Assessment of Costs
, 44.3 Where the amount of costs is assessed, the court will only want to allow those
that are reasonable and proportionate.
The court may order that an amount of costs be assessed by summary or
detailed assessment (the latter unless otherwise specified). It will assess those
costs on the:
(a) Standard basis; or
Requiring the receiving party to show costs are reasonable and
proportionate.
(b) Indemnity basis.
Requiring the paying party to show costs are not reasonable and
proportionate.
The ‘reasonableness’ and ‘proportionality’ of costs depends on:
(a) The sums in issue;
(b) The value of any non-monetary relief in issue;
(c) The complexity of the litigation;
(d) Any additional work generated by the conduct of the paying party;
(e) Any wider factors involved in proceedings, such as reputation or public
importance; and
(f) Any additional work undertaken or expense incurred due to the
vulnerability of a party or any witness.
A summary assessment of costs will be utilised at the conclusion of a fast-track trial
or a trial concluded after one day, unless there is a significant dispute or a good
reason as to why not to. In any other case, a detailed assessment will be required.
- A detailed assessment can be ordered at any time.
The difference is simply the depth that the court will go into in determining the costs.
Time-Limits
44.7 A party must comply with an order for the payment of costs within 14 days
of the date on which costs are specified (either on day of order or later) or on a
date the court specifies.
Misconduct
44.11 In cases of misconduct, jf the court feel that, at any point, a party or their
legal representative fail to comply with a rule, PD or court order, or conduct
themselves unreasonably, the court may disallow all or part of the costs being
assessed or order that the party at fault or their representative pay costs which they
have caused the other party to incur.
One-way Cost Shifting
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