Costs in Civil Litigation (SQE1 Syllabus)

Comprehensive practice flashcards covering legal costs, assessment bases, non-party costs, security for costs, and Part 36 offers based on the SQE1 syllabus.

According to the general rule in CPR r 44.2(2), who is responsible for paying legal costs?

The unsuccessful party pays the successful party’s costs.

In the context of costs, define the 'receiving party' and the 'paying party'.

The receiving party is the successful party entitled to payment of their costs; the paying party is the unsuccessful party ordered to pay those costs.

Under the costs management order on the multi-track, when can a court depart from the last approved or agreed budgeted costs on the standard basis?

Only if there is a 'good reason' to do so, such as when the costs of a phase were not incurred at all or were much less than budgeted.

How are costs handled on the Small claims track versus the Multi-track?

On the Small claims track, legal costs are not recoverable and only disbursements are payable; on the Multi-track, a detailed assessment of costs is carried out.

What determines the amount of legal costs recoverable in the fast and intermediate tracks?

The court assigns the claim to a complexity band which determines an ascending scale of fixed recoverable costs.

By what percentage can a party's fixed recoverable costs be increased or decreased for 'unreasonable conduct'?

By $50\%$.

When is a summary assessment of costs typically conducted, and what document is required from the parties?

It is conducted at any hearing lasting no more than a day; parties must file and serve a statement of costs at least $24$ hours before the hearing.

What is the monetary threshold for a 'provisional assessment' during detailed assessment proceedings?

If the costs claimed are less than $£75,000$.

Under Rule 44.4, what are the two bases upon which costs are ordered?

The standard basis and the indemnity basis.

How is doubt resolved when assessing costs on the 'standard basis' versus the 'indemnity basis'?

On the standard basis, doubt is resolved in favor of the paying party; on the indemnity basis, doubt is resolved in favor of the receiving party.

According to the case of Symphony Group Plc v Hodgson [1994], what is a 'pure funder' in non-party costs contexts?

A party with no personal interest in the litigation, who does not benefit from it, is not funding it as a business, and did not seek to control the litigation.

Under CPR r 25.27, list three common conditions for a defendant to apply for security for costs.

The claimant is resident outside the jurisdiction, the claimant is an impecunious company, or the claimant has taken steps to make enforcement difficult.

What are the formal requirements for a valid Part 36 offer?

It must be in writing, state it is made pursuant to Part 36, specify a 'relevant period' of not less than $21$ days for acceptance, and specify if it relates to the whole or part of the claim (and any counterclaim).

In Part 36, what is the consequence if a claimant accepts a defendant’s offer within the relevant period?

The proceedings are stayed, the defendant pays the settlement within $14$ days, and the defendant pays the claimant’s costs up to the date of notice of acceptance.

What is a 'split costs' order in the context of a defendant's Part 36 offer?

If the claimant wins at trial but fails to beat the defendant's offer, the defendant pays the claimant's costs up to Day $21$, and the claimant pays the defendant's costs from Day $22$ to judgment.

If a claimant equals or beats their own Part 36 offer at trial on the multi-track, what interest rate penalty can be applied to the damages from Day 22 onwards?

Enhanced interest at a rate not exceeding $10\%$ above the base rate.

What is the 'additional amount' penalty for a defendant who fails to accept a claimant's Part 36 offer that is later equaled or beaten, if the damages awarded are $£500,000$ or less?

$10\%$ of the sum awarded.

Define a 'Calderbank offer'.

An offer to settle made 'without prejudice save as to costs' outside of the formal Part 36 rules.