> ### PRACTICE DIRECTION

> ### PART 44 - PRACTICE DIRECTION ABOUT COSTS

> ### See also Civil Procedure Rules
> See also Court Service Forms

> ### DIRECTIONS RELATING TO PART 44

> ### GENERAL RULES ABOUT COSTS

> ### RULE 44.2 SOLICITOR'S DUTY TO NOTIFY CLIENT

> 1.1 | 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 or a trade union) who has instructed the solicitor to act or who is liable to pay his fees.
> 1.2 | Where a solicitor notifies a client of an order under that rule, he must also explain why the order came to be made.
> 1.3 | 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.

> ### RULE 44.3 COURT'S DISCRETION AND CIRCUMSTANCES TO BE TAKEN INTO ACCOUNT WHEN EXERCISING ITS DISCRETION AS TO COSTS

> 2.1 | 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.
> 2.2 | 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 Contentious Probate Practice Direction Supplementing Part 49), 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 paragraph 1.2 of the Contentious Probate Practice Direction.
> 2.3 | The court may make an order about costs at any stage in a case. 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.
> 2.4 | 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 (whether or not it is made in accordance with Part 36). Where a claimant has made a Part 36 offer and fails to obtain a judgment which is more advantageous than that offer that circumstance alone will not lead to a reduction in the costs awarded to the claimant under this rule.
> 2.5 | 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
> Costs Costs in any event | 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.
> Costs in the case Costs in the application | 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.
> Costs reserved | 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.
> Claimant's/ Defendant's costs in the case/application. | If the party in whose favour the costs order is made is awarded costs at the end of 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.
> Costs thrown away | 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 - preparing for and attending any hearing at which the judgment or order which has been set aside was made; preparing for and attending any hearing to set aside the judgment or order in question; preparing for and attending any hearing at which the court orders the proceedings or the part in question to be adjourned; any steps taken to enforce a judgment or order which has subsequently been set aside.
> Costs of and caused by | 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. Term Effect
> Costs here and below | 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.
> No order as to costs Each party to pay his own costs | 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.
> 2.6 | Where, under rule 44.3(8), the court orders an amount to be paid before costs are assessed- the order will state that amount, and if no other date for payment is specified in the order rule 44.8 (Time for complying with an order for costs) will apply.

> ### Fees of counsel

> 2.7 | This paragraph applies where the court orders the detailed assessment of the costs of a hearing at which one or more counsel appeared for a party. Where an order for costs states the opinion of the court as to whether or not the hearing was fit for the attendance of one or more counsel, a costs officer conducting a detailed assessment of costs to which that order relates will have regard to the opinion stated.

> ### Fees payable to conveyancing counsel appointed by the court to assist it

> 2.8 | Where the court refers any matter to the conveyancing counsel of the court the fees payable to counsel in respect of the work done or to be done will be assessed by the court in accordance with rule 44.3. An appeal from a decision of the court in respect of the fees of such counsel will be dealt with under the general rules as to appeals unless the appeal is against the decision of a costs officer when the appeal will be dealt with in accordance with Part 47 Section VIII. In either case the decision of the appellate court is final.

> ### RULE 44.5 FACTORS TO BE TAKEN INTO ACCOUNT IN DECIDING THE AMOUNT OF COSTS

> 3.1 | 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.
> 3.2 | 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.
> 3.3 | 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.

> ### RULE 44.7 PROCEDURE FOR ASSESSING COSTS

> 4.1 | 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 to make a summary assessment of the amount of the costs, or to order the amount to be decided in accordance with Part 47 (a detailed assessment).
> 4.2 | 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.

> ### Summary Assessment

> 4.3 | 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.
> 4.4 | The general rule is that the court should make a summary assessment of the costs: at the conclusion of the trial of a case which has been dealt with on the fast track, in which case the order will deal with the costs of the whole claim, and at the conclusion of any other hearing, which has lasted not more than one day, in which case the order will deal with the costs of the application or matter to which the hearing related. If this hearing disposes of the claim, the order may deal with the costs of the whole claim; 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. The general rule in paragraph 1 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. Section 1 of the directions relating to Part 48 deals in more detail with costs relating to mortgages. The general rule is that no summary assessment of costs will be made if the court has ordered that the costs in question will be treated as costs in the case (as to which see paragraph 2.4 above). 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.
> 4.5 | 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 4.4 above applies, in accordance with the following paragraphs. 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: the number of hours to be claimed, the hourly rate to be claimed, the grade of fee earner; the amount and nature of any disbursement to be claimed, other than counsel's fee for appearing at the hearing, the amount of solicitor's costs to be claimed for attending or appearing at the hearing, the fees of counsel to be claimed in respect of the hearing, and any Value Added Tax to be claimed on these amounts. The statement of costs should follow as closely as possible Form 1 of the Schedule of Costs Forms annexed to this practice direction and must be signed by the party or his legal representative. Where a litigant is represented by a solicitor in his employment the statement of costs need not include the certificate appended at the end of Form 1. 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.
> 4.6 | 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.
> 4.7 | If the court makes a summary assessment of the costs the court will specify the amount payable as a single figure which will include all sums in respect of profit costs, disbursements and VAT which is allowed, and the amount which is awarded under Part 46 (Fast Track Trial Costs).
> 4.8 | 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.
> 4.9 | The court will not make a summary assessment of the costs of a receiving party who is an assisted person within the meaning of the Legal Aid Act 1988. A summary assessment of costs payable by an assisted person is not by itself a determination of the assisted person's liability to pay those costs (as to which see Section 17 of the Legal Aid Act 1988). Accordingly the court may make a summary assessment of costs payable by an assisted person. The court will not make a summary assessment of the costs of a receiving party who is a child or patient within the meaning of Part 21 unless the solicitor acting for the child or patient has waived the right to further costs (see paragraph 1.2(c) of the Direction relating to Part 48). The court may make a summary assessment of costs payable by a child or patient.
> 4.10 | The court will not endorse disproportionate and unreasonable costs. Accordingly: When the amount of the costs to be paid has been agreed, the court will make this clear by saying that the order is by consent; If the judge is to make an order which is not by consent, the judge will, so far as possible, ensure that the final figure is not disproportionate and/or unreasonable having regard to Part 1 of the CPR. The judge will retain this responsibility notwithstanding the absence of challenge to individual items in the make-up of the figure sought. The fact that the paying party is not disputing the amount of costs can however be taken as some indication that the amount is proportionate and reasonable. The judge will therefore intervene only if satisfied that the costs are so disproportionate that it is right to do so.

> ### Payments on account of costs

> 4.11 | 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.

> ### RULE 44.9 COSTS ON THE SMALL CLAIMS TRACK AND FAST TRACK

> 5.1 | Before a claim is allocated to one of those tracks the court is not restricted by any of the special rules that apply to that track. Where a claim has been allocated to one of those tracks, the special rules which relate to that track will apply to work done before as well as after allocation save to the extent (if any) that an order for costs in respect of that work was made before allocation. This paragraph applies where a claim issued for a sum in excess of the normal financial scope of the small claims track is allocated to that track only because an admission of part of the claim by the defendant reduces the amount in dispute to a sum within the normal scope of that track. (See also paragraph 7.4 of the practice direction supplementing CPR Part 26) On entering judgment for the admitted part before allocation of the balance of the claim the court may allow costs in respect of the proceedings down to that date.

> ### RULE 44.11 COSTS FOLLOWING ALLOCATION AND RE-ALLOCATION

> 6.1 | 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.
> 6.2 | 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).
> 6.3 | 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.

> ### RULE 44.14 COURT'S POWERS IN RELATION TO MISCONDUCT

> 7.1 | 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.
> 7.2 | 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.
> 7.3 | 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.

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