05 Aug Costs of Litigation
Generally speaking, when you are successful in Court the Judge will make an order to the losing party to pay the winning party’s costs, however costs are not always awarded. These costs commonly do not cover the entire legal fees spent and are known as party to party costs. At the end of the trial the judge will take submissions on the costs incurred by the winning party. In some instances, there may be a dispute over excessive costs in which case a judge may order a costs assessor to determine the appropriate amount of costs that are to be paid. As a rule of thumb, the losing party will have to pay approximately 70% of the winning party’s costs.
The Different Types of Costs in Litigation
- Solicitor’s fees
- Barrister’s fees
- Expert witness fees
- Court fees
Party to Party Costs
There are two scenarios that play out after a judgement in favour of one party with respect to costs. The first being an agreement between the parties as to what costs will be paid by the losing party. The second, what costs will be ordered by the Court in the event the parties cannot come to an agreement on the costs. If the Court has to determine the costs, they may appoint an assessor. An independent assessor will work out what is a reasonable charge for costs based on the legal work done.
Indemnity costs are full legal costs. A Court will only award these costs in special circumstances. Some of these circumstances include when an offer has been made prior to the completion of trial, that offer is rejected and the final judgement is less than the amount offered. Other examples of arguments which may invoke a ruling for costs on an indemnity basis are:
- There were no reasonable prospects of success in bringing the case before the Courts
- Refusal to accept a reasonable offer before trial even began
- Unreasonable conduct of one party
Costs in Different Jurisdictions
It is important to note that some Courts and jurisdictions do not allow for costs orders in favour of the successful party. Tribunals like the Administrative Appeals Tribunal is generally a no cost jurisdiction unless in certain extreme circumstances. Moreover, local Courts that hear small claims of less than $20,000.00 will not award costs. It is therefore crucial to know before entering into litigation what the cost jurisdiction is.
Certain costs for certain tasks are fixed on a sliding scale depending on which Court’s jurisdiction you are in. This higher the Court the more you will have to pay for fixed costs.
Should you require assistance with your litigation matter, please give us a call for a free assessment. Our contact details are:
Berrigan Doube Lawyers
Melbourne: (03) 9600 2577
Sydney: (02) 9251 6699
Brisbane: (07) 3229 0707