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What are costs

The court usually makes an award of costs at the conclusion of an interlocutory hearing or a civil trial. This is when the amount payable for costs will be awarded between the party who filed the interlocutory application or the claim (the plaintiff or the applicant) and the party against whom the application or the claim was made (the defendant or the respondent).

This may include fees, charges, disbursements, expenses and remuneration, such as:

  • Court hearing fees.
  • Filing fees for court papers.
  • Professional fees charged by a party's lawyer.

Types of costs

Refer to the following to find out the types of costs parties may be entitled to receive.

Party-and-party costs are the costs to be paid by one party to another party.

In general, costs follow the event for most civil actions. This means that the costs of an action are usually awarded to the winning party.

If the court intends for the ultimate loser of the suit to pay the costs, it will make an order for the losing party to pay the winning party the party-and-party costs. This is known as an order of costs in the cause.

Other costs orders the court may make

Any award of costs is at the discretion of the court. Refer to the following for other costs orders the court may make.

If the court makes an order for...

It means...

Plaintiff's costs in the cause or defendant's costs in the cause

The named party will be awarded costs only if the party succeeds in the proceedings, but does not have to pay the costs of the other party if the other party succeeds.

For example, if the court has ordered defendant’s costs in the cause, the plaintiff must pay the party-and-party costs to the defendant if the defendant wins the case.

However, if the defendant loses the case, the defendant need not pay the party-and-party costs to the plaintiff.

Costs in any event

One party is awarded the costs for an interlocutory matter, regardless of whether or not the party is eventually successful in the civil case.

Costs thrown away

A party is compensated for the time, effort and expenses incurred for a certain action that turned out to be wasted because of the other party's actions or conduct.

For example, if the amendment of a pleading by the plaintiff causes the defendant to also amend the defendant's initial pleading, this may lead to the wastage of the defendant's costs in preparing their pleading.

In this case, the court may award costs thrown away to the defendant.

Calculation of party-and-party costs

There are several ways the court may calculate the amount of party-and-party costs to be paid.

Costs can be:

  • Taxed by the court.
    • If the court orders costs to be taxed, this means that costs are awarded to a party but the amount is not fixed.
    • Parties will have to attend a separate taxation hearing at a later date to determine the amount of costs.
  • Fixed by the court.
    • If the court orders fixed costs, this means the court will order one party to pay a fixed amount to the other party for costs.
    • Parties may refer to Appendix 2 of Order 59 of the Rules of Court when calculating their figures for fixed costs.
Example

If the court dismisses the plaintiff's claim and decides to fix costs at $60,000 to be paid by the plaintiff (who is the losing party) to the defendant, the party-and-party costs is $60,000.

This amount of $60,000 represents what the court considers to be the fair, reasonable and proportionate amount of costs to be paid to the defendant for having to defend the plaintiff’s claim which was dismissed.

It is not meant to correspond to a full recovery of the actual amount of costs the defendant may have incurred in the course of the case.

Solicitor-and-client costs are the costs incurred because of the work done by a lawyer for the client. These costs are usually governed by an agreement between the party and the party's lawyer.

The winning party will be able to use the party-and-party costs received from the losing party to cover part of the winning party's solicitor-and-client costs (costs incurred because of engaging a lawyer).

The losing party will be liable for the party-and-party costs, on top of the losing party's own solicitor-and-client costs.

If there is a dispute over the lawyer's bill

A litigant may not always be entitled to full recovery for all the costs the lawyer incurred in representing the litigant in a civil case.

If a litigant wishes to dispute the lawyer's bill, the litigant may apply for the bill to be presented to the court for taxation. The litigant may also apply to the court for the lawyer's bill to be taxed.

Need help?

The information here is for general guidance as the courts do not provide legal advice. If you need further help, you may want to get independent legal advice.

Find out more

Resources

Legislation associated with this topic includes Order 59 of the Rules of Court.
Refer to:

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