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K19.2. A different emphasis in the reforms
| 555. | Reforms implemented and being discussed in jurisdictions comparable to our own also envisage different functions for costs rules relating to the two separate sets of costs. In respect of costs charged by a party's own lawyers, the reforms tend to adopt a more interventionist (and less of a laisser-faire) approach, having as their principal aim, the reining in of such costs generally or at least promoting proportionality between the value of the claim and the legal costs incurred to pursue it. |
| 556. | Orders to pay the other side's costs also constitute a prominent feature of such reforms. As we have seen, under the CPR, the incentive to abide by pre-action protocols is the threat of costs orders which may subsequently be made. Part 36 offers similarly hold out the threat of indemnity costs (stiffened by substantial interest sanctions, in the case of offers by the plaintiff). Unnecessary interlocutory applications are discouraged by costs orders made on a summary assessment by the court. Indeed, the sanction of adverse costs orders fundamentally underpins all of the CPR's innovations and is intended as a general deterrent to procedural unreasonableness. |
| 556.1 | CPR 44.5(3)(a) provides that in exercising its discretion in making costs orders, the court :- |
| "...... must ...... have regard to the conduct of all the parties, including in particular (i) conduct before, as well as during, the proceedings; and (ii) the efforts made, if any, before and during the proceedings in order to try to resolve the dispute." | ||
| 556.2 | CPR 44.14 allows the court to make adverse costs orders as well as wasted costs orders against the legal representatives where :- |
| "...... it appears to the court that the conduct of a party or his legal representative, before or during the proceedings which gave rise to the assessment proceedings, was unreasonable or improper." | ||
| 557. | Although cost-shifting has been retained as a principle, (Note 495) the CPR reforms place less emphasis on the "costs follow the event" principle and a greater reliance on the flexible use of costs orders throughout the proceedings as an incentive for reasonable litigant behaviour. Readers are consulted on whether costs provisions effecting a similar shift in emphasis, in particular, requiring the court generally to take into account the reasonableness of the parties' conduct before and during the proceedings, should be adopted: Proposal 51. |
Notes
| 495 | CPR 44.3(2): "If the court decides to make an order about costs the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but the court may make a different order." <back> |
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