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Costs Orders

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Costs Orders

Queensland courts have the power to award costs in all proceedings brought before them unless otherwise provided. The awarding of costs in Queensland civil matters is governed by the Uniform Civil Procedure Rules 1999 (Qld) (the UCPR).

Rule 681 (1) of the UCPR confers upon Queensland courts a wide-ranging discretion to award costs. The general principle relied on by courts is that costs must “follow the event”, meaning that where a costs order has been made, the unsuccessful litigant must pay the legal costs incurred by the successful litigant.

The court will not deprive a successful party of its costs unless exceptional grounds or circumstances arise, for example where the successful party has only succeeded on a technicality or has caused unnecessary litigation, delay or expense to the unsuccessful party through its own conduct.

If a party is entitled to costs, rule 687 of the UCPR stipulates that costs are to be assessed by a costs assessor unless the court orders otherwise. Depending on the circumstances of the case, alternative orders to payment of the assessed costs may include:

• Payment of a specified part or percentage of assessed costs;
• Payment of assessed costs beginning or ending at a specified stage of the proceeding;
• Payment of an amount for costs fixed by the court; or
• Payment of an amount for costs to be decided in the way the court directs.

A costs order will be enforceable for up to 6 years after the day that the order is made.

Standard Costs

A costs assessor will assess costs on the standard basis unless the UCPR or an order of the court provides otherwise. When assessing costs on the standard basis (also known as “party and party costs”), under rule 702 (1) of the UCPR a costs assessor must allow only those costs which are necessary or proper for the attainment of justice of for enforcing or defending the rights of the party whose costs are being assessed. As a result, a successful party will only be awarded a portion (usually between 50% and 75%) or the legal costs they have incurred.

Indemnity Costs

Rule 703(1) of the UCPR allows the court to assess costs on the indemnity basis. Costs awarded on the indemnity basis (also known as “solicitor and client costs”) will generally be higher than those awarded on the standard basis, and a successful party may be awarded as much as 95% of the legal costs they have incurred.

A costs order will only be made on the indemnity basis where such an order is justified by unusual or exceptional circumstances. Circumstances where indemnity costs may be awarded include:

• Where the unsuccessful party has persisted in litigating a case with no prospects of success;
• Where a party has made unfounded allegations of fraud or improper conduct by another party;
• Where a party has deliberately prolonged the matter, or engaged in obstructionist or misleading conduct, to such a degree as to amount to an abuse of the process of the court;
• Where a party has deliberately engaged in fraud during the course of litigation; and
• Where a party has unreasonably rejected a genuine offer of compromise which was more favourable to that party than the ultimate judgement of the court.

When assessing costs on the indemnity basis, a costs assessor must allow all costs which are not of an unreasonable amount and which have not been unreasonably incurred. The court will have regard to;

• The scale of costs prescribed for the court by Schedule 1 or 2 of the UCPR;
• Any costs agreement between the party to whom the costs are payable and that party’s solicitor; and
• The charges ordinarily paid to a solicitor for the work performed.

Applying for a costs assessment

If you are a successful litigant who seeks to recover legal costs, you must file an application for a costs assessment with the relevant court. The court may hold a hearing to determine whether a costs assessment is appropriate; if this happens, you may be required to make submissions in support of your entitlement to costs.

Once a costs order has been made, you must serve a costs statement on the party liable to pay costs. The opposing party will have 21 days after being served to object to any item in the statement by serving a notice of objection. If you do not serve a costs statement, you may be at risk of having your costs order educed or set aside.

Case example on costs order where Aitken Whyte Lawyers acted

JTD v PDL (No4) [2023] QDC 12

Aitken Whyte Lawyers successfully represented the defendant in a defamation proceeding, where the defendant sought to prevent amendments to the plaintiff’s statement of claim.

The successful component of the application included the court disallowing two of the four proposed amendments by the plaintiff, determining that they introduced new causes of action that were time-barred. In this case, the relevant period in the Limitations of Actions Act, within which time proceedings had to have been commenced to maintain an action, had already expired by the time the proposed changes were to be included as part of the ongoing court proceedings.

The District Court of Queensland subsequently ordered the plaintiff to pay our clients costs for the application, fixed at $6,500 to avoid undue delay and expense.

Here to Help

Proper experience in civil litigation is essential. Aitken Whyte Lawyers are focused on results.

Our Litigation and Dispute Resolution Team will advise you on your prospects of being awarded costs at the conclusion of a trial or interim application. We can also advise you on the steps you can take to maximize the likelihood of being awarded indemnity costs, and can assist you in filing an application for a costs assessment. Aitken Whyte Lawyers can assist you with all civil and commercial disputes.

Office Location and Contact Details

Brisbane

Aitken Whyte Lawyers Brisbane
2/414 Upper Roma Street
Brisbane QLD 4000

Ph: 07 3229 4459
Fax: +617 3211 9311
E: enquiries@awbrisbanelawyers.com.au