See also Part 44, Court Service Forms
DIRECTIONS RELATING TO PART 44
GENERAL RULES ABOUT COSTS
| 7.1 |
For the purposes of rule 44.2 ‘client’ includes a party for whom a solicitor is acting and any other person (for example, an insurer, a trade union or the LSC) who has instructed the solicitor to act or who is liable to pay his fees. |
| This Paragraph is referred to in: QB Guide - Chapter 2 (2.5). |
Where a solicitor notifies a client of an order under that rule, he must also explain why the order came to be made.
| This Paragraph is referred to in: QB Guide - Chapter 2 (2.5). |
Although rule 44.2 does not specify any sanction for breach of the rule the court may, either in the order for costs itself or in a subsequent order, require the solicitor to produce to the court evidence showing that he took reasonable steps to comply with the rule.
| 8.1 |
Attention is drawn to the factors set out in this rule which may lead the court to depart from the general rule stated in rule 44.3(2) and to make a different order about costs. |
| 8.2 |
In a probate claim where a defendant has in his defence given notice that he requires the will to be proved in solemn form (see paragraph 8.3 of the practice directionpdp-57supplementing Part 57), the court will not make an order for costs against the defendant unless it appears that there was no reasonable ground for opposing the will. The term ‘probate claim’ is defined in rule 57.1(2). |
| Erroneous references in Para 8.2 replaced w/e from 1 February 2004. |
| (1) | The court may make an order about costs at any stage in a case. |
| (2) | In particular the court may make an order about costs when it deals with any application, makes any order or holds any hearing and that order about costs may relate to the costs of that application, order or hearing. |
| (3) | * Rule 44.3A(1) provides that the court will not assess any additional liability until the conclusion of the proceedings or the part of the proceedings to which the funding arrangement relates. (Paragraphs 2.4 and 2.5 above explain when proceedings are concluded. As to the time when detailed assessment may be carried out see paragraphs 28.1, below.) |
| 8.4 |
In deciding what order to make about costs the court is required to have regard to all the circumstances including any payment into court or 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. |
| Text substituted w/e from 6 April 2007. |
There are certain costs orders which the court will commonly make in proceedings before trial. The following table sets out the general effect of these orders. The table is not an exhaustive list of the orders which the court may make.
| Term | Effect |
|---|---|
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The party in whose favour the order is made is entitled to the costs in respect of the part of the proceedings to which the order relates, whatever other costs orders are made in the proceedings. |
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The party in whose favour the court makes an order for costs at the end of the proceedings is entitled to his costs of the part of the proceedings to which the order relates. |
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The decision about costs is deferred to a later occasion, but if no later order is made the costs will be costs in the case. |
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If the party in whose favour the costs order is made is awarded costs at the end the proceedings, that party is entitled to his costs of the part of the proceedings to which the order relates. If any other party is awarded costs at the end of the proceedings, the party in whose favour the final costs order is made is not liable to pay the costs of any other party in respect of the part of the proceedings to which the order relates. |
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Where, for example, a judgment or order is set
aside, the party in whose favour the costs order is made is entitled to the
costs which have been incurred as a consequence. This includes the costs of
–
|
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Where, for example, the court makes this order on an application to amend a statement of case, the party in whose favour the costs order is made is entitled to the costs of preparing for and attending the application and the costs of any consequential amendment to his own statement of case. |
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The party in whose favour the costs order is made is entitled not only to his costs in respect of the proceedings in which the court makes the order but also to his costs of the proceedings in any lower court. In the case of an appeal from a Divisional Court the party is not entitled to any costs incurred in any court below the Divisional Court. |
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Each party is to bear his own costs of the part of the proceedings to which the order relates whatever costs order the court makes at the end of the proceedings. |
| This Paragraph is referred to in: SCCO costs guide - Section 2 (2.3). |
Where, under rule 44.3(8), the court orders an amount to be paid before costs are assessed –
| (1) | the order will state that amount, and |
| (2) | if no other date for payment is specified in the order, rule 44.8 (Time for complying with an order for costs) will apply. |
| 8.7 |
|
| 8.8 |
|
| 9.1 |
Under an order for payment of ‘costs’ the costs payable will include an additional liability incurred under a funding arrangement. |
| 9.2 |
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| 10.1 |
In a case to which rule 44.3B(1)(c) or (d) applies the party in default may apply for relief from the sanction. He should do so as quickly as possible after he becomes aware of the default. An application, supported by evidence, should be made under Part 23 to a costs judge or district judge of the court which is dealing with the case. (Attention is drawn to rules 3.8 and 3.9 which deal with sanctions and relief from sanctions). |
| 10.2 |
Where the amount of any percentage increase recoverable by counsel may be affected by the outcome of the application, the solicitor issuing the application must serve on counsel a copy of the application notice and notice of the hearing as soon as practicable and in any event at least 2 days before the hearing. Counsel may make written submissions or may attend and make oral submissions at the hearing. (Paragraph 1.4 contains definitions of the terms ‘counsel’ and ‘solicitor’.) |
| 10A.1 |
Rule 44.3C(2) sets out how the court may determine the amount of payment when making an order under section 194(3) of the Legal Services Act 2007. Paragraph 13.2 of this Practice Direction provides that the general rule is that the court will make a summary assessment of costs in the circumstances outlined in that paragraph unless there is good reason not to do so. This will apply to rule 44.3C(2)(b) with the modification that the summary assessment of the costs is to be read as meaning the summary assessment of the sum equivalent to the costs that would have been claimed by the party with pro bono representation in respect of that representation had it not been provided free of charge. |
| 10A.2 |
Where an order under section 194(3) of the Legal Services Act 2007 is sought, to assist the court in making a summary assessment of the amount payable to the prescribed charity, the party who has pro bono representation must prepare, file and serve in accordance with paragraph 13.5(2) a written statement of the sum equivalent to the costs that party would have claimed for that legal representation had it not been provided free of charge. |
| 11.1 |
In applying the test of proportionality the court will have regard to rule 1.1(2)(c). The relationship between the total of the costs incurred and the financial value of the claim may not be a reliable guide. A fixed percentage cannot be applied in all cases to the value of the claim in order to ascertain whether or not the costs are proportionate. |
| 11.2 |
In any proceedings there will be costs which will inevitably be incurred and which are necessary for the successful conduct of the case. Solicitors are not required to conduct litigation at rates which are uneconomic. Thus in a modest claim the proportion of costs is likely to be higher than in a large claim, and may even equal or possibly exceed the amount in dispute. |
| 11.3 |
Where a trial takes place, the time taken by the court in dealing with a particular issue may not be an accurate guide to the amount of time properly spent by the legal or other representatives in preparation for the trial of that issue. |
| 11.4 |
Where a party has entered into a funding arrangement the costs claimed may, subject to rule 44.3B include an additional liability. |
| This Paragraph is referred to in: BA v British Coal Corporation [33]. |
In deciding whether the costs claimed are reasonable and (on a standard basis assessment) proportionate, the court will consider the amount of any additional liability separately from the base costs.
| This Paragraph is referred to in: Atack v Grecham [3]. |
In deciding whether the base costs are reasonable and (if relevant) proportionate the court will consider the factors set out in rule 44.5.
| 11.7 |
Subject to paragraph 17.8(2), when the court is considering the factors to be taken into account in assessing an additional liability, it will have regard to the facts and circumstances as they reasonably appeared to the solicitor or counsel when the funding arrangement was entered into and at the time of any variation of the arrangement. |
| This Paragraph is referred to in: Atack v Grecham [3], Bensusan v Freedman [43], Sarwar v Alam [56]. |
| (1) | In deciding whether a
percentage increase is reasonable relevant factors to be taken into account may
include:
|
| (2) | Omitted. |
| This Paragraph is referred to in: Atack v Grecham [3], Gloucestershire County Council v Evans [18]. |
A percentage increase will not be reduced simply on the ground that, when added to base costs which are reasonable and (where relevant) proportionate, the total appears disproportionate.
| This Paragraph is referred to in: BA v British Coal Corporation [33]. |
In deciding whether the cost of insurance cover is reasonable, relevant factors to be taken into account include:
| (1) | where the insurance cover is not purchased in support of a conditional fee agreement with a success fee, how its cost compares with the likely cost of funding the case with a conditional fee agreement with a success fee and supporting insurance cover; |
| (2) | the level and extent of the cover provided; |
| (3) | the availability of any pre-existing insurance cover; |
| (4) | whether any part of the premium would be rebated in the event of early settlement; |
| (5) | the amount of commission payable to the receiving party or his legal representatives or other agents. |
| This Paragraph is referred to in: Callery v Gray (No 2) [73], Callery v Gray [22], Sarwar v Alam [56]. |
Where the court is considering a provision made by a membership organisation, rule 44.3B(1) (b) provides that any such provision which exceeds the likely cost to the receiving party of the premium of an insurance policy against the risk of incurring a liability to pay the costs of other parties to the proceedings is not recoverable. In such circumstances the court will, when assessing the additional liability, have regard to the factors set out in paragraph 11.10 above, in addition to the factors set out in rule 44.5.
| 12.1 |
Where the court does not order fixed costs (or no fixed costs are provided for) the amount of costs payable will be assessed by the court. This rule allows the court making an order about costs either
|
| 12.2 |
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. |
| 12.3 |
Whenever the court awards costs to be assessed by way of detailed assessment it should consider whether to exercise the power in rule 44.3(8) (Courts Discretion as to Costs) to order the paying party to pay such sum of money as it thinks just on account of those costs. |
| 13.1 |
Whenever a court makes an order about costs which does not provide for fixed costs to be paid the court should consider whether to make a summary assessment of costs. |
| 13.2 |
The general rule is that the court should make a summary assessment of the costs:
unless there is good reason not to do so e.g. where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily or there is insufficient time to carry out a summary assessment. |
| 13.3 |
The general rule in paragraph 13.2 does not apply to a mortgagee’s costs incurred in mortgage possession proceedings or other proceedings relating to a mortgage unless the mortgagee asks the court to make an order for his costs to be paid by another party. Paragraphs 50.3 and 50.4 deal in more detail with costs relating to mortgages. |
| 13.4 |
Where an application has been made and the parties to the application agree an order by consent without any party attending, the parties should agree a figure for costs to be inserted in the consent order or agree that there should be no order for costs. If the parties cannot agree the costs position, attendance on the appointment will be necessary but, unless good reason can be shown for the failure to deal with costs as set out above, no costs will be allowed for that attendance. |
| This Paragraph is referred to in: QB Guide - Chapter 2 (2.5). |
| (1) | It is the duty of the parties and their legal representatives to assist the judge in making a summary assessment of costs in any case to which paragraph 13.2 above applies, in accordance with the following paragraphs. |
| (2) | Each party who intends to claim costs must
prepare a written statement of the costs he intends to claim showing separately
in the form of a schedule:
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(*3) The statement of costs should follow as closely as possible Form N260 and must be signed by the party or his legal representative. Where a litigant is an assisted person or is a LSC funded client or is represented by a solicitor in the litigant’s employment the statement of costs need not include the certificate appended at the end of Form N260. |
| (4) | 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. The statement of costs should be filed and the copies of it should be served as soon as possible and in any event not less than 24 hours before the date fixed for the hearing. |
| (5) | *Where the litigant is or may be entitled to claim an additional liability the statement filed and served need not reveal the amount of that liability. |
| This Paragraph is referred to in: Chancery Guide - Chap 11 (11.4), (11.4), QB Guide - Chapter 2 (2.5), 1-800 Flowers Inc v Phonenames Ltd [107], Gregory v Turner [20]. |
The failure by a party, without reasonable excuse, to comply with the foregoing paragraphs will be taken into account by the court in deciding what order to make about the costs of the claim, hearing or application, and about the costs of any further hearing or detailed assessment hearing that may be necessary as a result of that failure.
| 13.7 |
If the court makes a summary assessment of costs at the conclusion of proceedings the court will specify separately
|
| This Paragraph is referred to in: Gregory v Turner [20]. |
The court awarding costs cannot make an order for a summary assessment of costs by a costs officer. If a summary assessment of costs is appropriate but the court awarding costs is unable to do so on the day, the court must give directions as to a further hearing before the same judge.
| This Paragraph is referred to in: 656 [26], Cranfield v Bridgegrove Ltd [26]. |
* The court will not make a summary assessment of the costs of a receiving party who is an assisted person or LSC funded client.
| 13.10 |
* A summary assessment of costs payable by an assisted person or LSC funded client is not by itself a determination of that person’s liability to pay those costs (as to which see rule 44.17 and paragraphs 21.1 to 23.17 of this Practice Direction). |
| 13.11 |
|
| Text of Paragraphs 13.11(1) and (2) amended w/e from 1 October 2007. |
| (1) | Attention is drawn to rule 44.3A which prevents the court from making a summary assessment of an additional liability before the conclusion of the proceedings or the part of the proceedings to which the funding arrangement relates. Where this applies, the court should nonetheless make a summary assessment of the base costs of the hearing or application unless there is a good reason not to do so. |
| (2) | Where the court makes a summary assessment of the base costs all statements of costs and costs estimates put before the judge will be retained on the court file. |
| 13.13 |
The court will not give its approval to disproportionate and unreasonable costs. Accordingly:
|
| This Paragraph is referred to in: 1-800 Flowers Inc v Phonenames Ltd [112]. |
| 14.1 |
The existence of a conditional fee agreement or other funding arrangement within the meaning of rule 43.2 is not by itself a sufficient reason for not carrying out a summary assessment. |
| 14.2 |
Where a legal representative acting for the receiving party has entered into a conditional fee agreement the court may summarily assess all the costs (other than any additional liability). |
| 14.3 |
Where costs have been summarily assessed an order for payment will not be made unless the court has been satisfied that in respect of the costs claimed, the receiving party is at the time liable to pay to his legal representative an amount equal to or greater than the costs claimed. A statement in the form of the certificate appended at the end of Form N260 may be sufficient proof of liability. The giving of information under rule 44.15 (where that rule applies) is not sufficient. |
| 14.4 |
The court may direct that any costs, for which the receiving party may not in the event be liable, shall be paid into court to await the outcome of the case, or shall not be enforceable until further order, or it may postpone the receiving party’s right to receive payment in some other way. |
| 14.5 |
Where there has been a trial of one or more issues separately from other issues, the court will not normally order detailed assessment of the additional liability until all issues have been tried unless the parties agree. |
| 14.6 |
Rule 44.3A(2) sets out the ways in which the court may deal with the assessment of the costs where there is a funding arrangement. Where the court makes a summary assessment of the base costs:
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| 14.7 |
Where the court makes a summary assessment of an additional liability at the conclusion of proceedings, that assessment must relate to the whole of the proceedings; this will include any additional liability relating to base costs allowed by the court when making a summary assessment on a previous application or hearing. |
| 14.8 |
Paragraph 13.13 applies where the parties are agreed about the total amount to be paid by way of costs, or are agreed about the amount of the base costs that will be paid. Where they disagree about the additional liability the court may summarily assess that liability or make an order for a detailed assessment. |
| 14.9 |
In order to facilitate the court in making a summary assessment of any additional liability at the conclusion of the proceedings the party seeking such costs must prepare and have available for the court a bundle of documents which must include –
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| This Paragraph is referred to in: QB Guide - Chapter 2 (2.5), Hollins v Russell [67]. |
| 15.1 |
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| This Paragraph is referred to in: PDP 26 (7.4). |
| 16.1 |
This paragraph applies where the court is about to make an order to re-allocate a claim from the small claims track to another track. |
| 16.2 |
Before making the order to re-allocate the claim, the court must decide whether any party is to pay costs to any other party down to the date of the order to re-allocate in accordance with the rules about costs contained in Part 27 (The Small Claims Track). |
| 16.3 |
If it decides to make such an order about costs, the court will make a summary assessment of those costs in accordance with that Part. |
| 17.1 |
A claim form under this rule should not be issued in the High Court unless the dispute to which the agreement relates was of such a value or type that had proceedings been begun they would have been commenced in the High Court. |
| 17.2 |
A claim form which is to be issued in the High Court at the Royal Courts of Justice will be issued in the Supreme Court Costs Office. |
| 17.3 |
Attention is drawn to rule 8.2 (in particular to paragraph (b)(ii)) and to rule 44.12A(3). The claim form must:
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| 17.4 |
The evidence to be filed and served with the claim form under Rule 8.5 must include copies of the documents on which the claimant relies to prove the defendant’s agreement to pay costs. |
| 17.5 |
A costs judge or a district judge has jurisdiction to hear and decide any issue which may arise in a claim issued under this rule irrespective of the amount of the costs claimed or of the value of the claim to which the agreement to pay costs relates. A costs officer may make an order by consent under paragraph 17.7, or an order dismissing a claim under paragraph 17.9 below. |
| Paragraph 17.5 amended w/e from 31st May 2001. |
When the time for filing the defendant’s acknowledgement of service has expired, the claimant may by letter request the court to make an order in the terms of his claim, unless the defendant has filed an acknowledgement of service stating that he intends to contest the claim or to seek a different order.
| 17.7 |
Rule 40.6 applies where an order is to be made by consent. An order may be made by consent in terms which differ from those set out in the claim form. |
| 17.8 |
|
| This Paragraph is referred to in: Bensusan v Freedman [44], Callery v Gray HL [90]. |
| Paragraph 17.8 added with effect, probably, from 3rd July 2000. |
| (1) | For the purposes of rule 44.12A(4)(b) – |
| (a) | a claim will be treated as opposed if the defendant files an acknowledgment of service stating that he intends to contest the making of an order for costs or to seek a different remedy; and |
| (b) | a claim will not be treated as opposed if the defendant files an acknowledgment of service stating that he disputes the amount of the claim for costs. |
| (2) | An order dismissing the claim will be made as soon as an acknowledgment of service opposing the claim is filed. The dismissal of a claim under rule 44.12A(4) does not prevent the claimant from issuing another claim form under Part 7 or Part 8 based on the agreement or alleged agreement to which the proceedings under this rule related. |
| This Paragraph is referred to in: Bensusan v Freedman [58]. |
| (1) | Rule 8.9 (which provides that claims issued under Part 8 shall be treated as allocated to the multi-track) shall not apply to claims issued under this rule. A claim issued under this rule may be dealt with without being allocated to a track. |
| (2) | Rule 8.1(3) and Part 24 do not apply to proceedings brought under rule 44.12A. |
| 17.11 |
Nothing in this rule prevents a person from issuing a claim form under Part 7 or Part 8 to sue on an agreement made in settlement of a dispute where that agreement makes provision for costs, nor from claiming in that case an order for costs or a specified sum in respect of costs. |
| 18.1 |
Before making an order under rule 44.14 the court must give the party or legal representative in question a reasonable opportunity to attend a hearing to give reasons why it should not make such an order. |
| 18.2 |
Conduct before or during the proceedings which gave rise to the assessment which is unreasonable or improper includes steps which are calculated to prevent or inhibit the court from furthering the overriding objective. |
| 18.3 |
Although rule 44.14(3) does not specify any sanction for breach of the obligation imposed by the rule the court may, either in the order under paragraph (2) or in a subsequent order, require the solicitor to produce to the court evidence that he took reasonable steps to comply with the obligation. |
| 19.1 |
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| 19.2 |
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| 19.3 |
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| 19.4 |
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| This Paragraph is referred to in: Hollins v Russell [66]. |
Where the court makes a Group Litigation Order, the court may give directions as to the extent to which individual parties should provide information in accordance with rule 44.15. (Part 19 deals with Group Litigation Orders.)
| 20.1 |
|
| This Paragraph is referred to in: Guide to Summary Assessment of Costs (4). |
| Words added in 20.1(1) w/e from 6 April 2006. |
In the following paragraphs ‘counsel’ means counsel who has acted in the case under a conditional fee agreement which provides for a success fee. A reference to counsel includes a reference to any person who appeared as an advocate in the case and who is not a partner or employee of the solicitor or firm which is conducting the claim or defence (as the case may be) on behalf of the receiving party.
| 20.3 |
|