Costs to Be Assessed if Not Agreed
How to Claim or Contest Legal Costs
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The legal costs of litigation can often be significant, and costs disputes are to be expected following the settlement of any case. In litigation, the unsuccessful party is usually responsible for paying the successful party’s costs; however, in most cases, they will only be held liable for a specific proportion of costs. The phrase “costs to be assessed if not agreed” will usually be found on a costs order following the successful conclusion of a case.
In some circumstances, costs will be agreed between parties, and there will be no requirement for an assessment. If however, costs cannot be agreed between parties, a detailed assessment of costs will be required.
If costs have been agreed between parties, detailed assessment of costs will not be required. The paying party should, therefore, pay the agreed costs to the receiving party within 14 days of the date of the Order, unless a specific date has been specified on the Order.
“Costs to be Assessed if Not Agreed” – Detailed Assessment of Costs
If costs cannot be agreed, a detailed assessment of costs will be required to determine the level of costs payable by the paying party. These types of assessments are common between Solicitors and Clients (under the Solicitors Act 1974), and between the successful party and unsuccessful party to a case (referred to as an inter-partes costs dispute).
Costs are usually assessed on the standard basis, which means that costs will only be allowed by the Court if they were reasonably incurred and proportionate to the work carried out.
The Detailed Assessment of Costs Process
- The first step in the detailed assessment process is for the receiving party to produce their Bill of Costs. The Bill of Costs should detail the costs incurred for any work done in conducting the case, as well as any disbursements incurred. The Bill should then be served on the paying party alongside a Notice of Commencement to initiate the detailed assessment process.
- If the paying party do not agree to all costs listed within the Bill of Costs, they should serve their Points of Dispute within 21 days of service of the Bill. Negotiation of the Bill of Costs should be attempted using the points of dispute.
- Points of Reply should be served by the receiving party if they are not in agreement with all the arguments listed within the Points of Dispute. Points of Reply should be served within 21 days; however, there will be no sanctions for late service of these Points.
- If costs have been agreed, they should be paid within 14 days, unless otherwise agreed between the parties.
What if the Paying Party Do Not Serve Points of Dispute?
If the paying party do not serve their Points of Dispute within 21 days of service of the bill, the paying party can apply to the Court for a Default Costs Certificate. This will mean that all costs listed within the Bill of Costs will be payable by the paying party to the receiving party.
What if an Agreement Cannot Be Reached Between Parties?
If the parties cannot reach an agreement as to costs, an application for a Detailed Assessment Hearing should be made by the receiving party. An additional Court fee will be incurred within the application, and the fee will be scaled dependant on the value of the Bill.
It should be noted that parties are always encouraged to engage in Alternative Dispute Resolution (ADR) before deciding to proceed to an assessment hearing. If a party refuses an offer to engage in ADR, there may be serious costs consequences as a result.
How Can ARC Costs Assist?
If you have received an Order for Costs stating “costs to be assessed if not agreed,” ARC Costs can provide assistance in claiming or contesting legal costs, dependant upon whether you are the paying party or the receiving party.
We are highly experienced Costs Draftsmen/Costs Lawyers and have been successful in recovering millions in legal fees for our clients. We can assist in the whole of the detailed assessment process, from drafting your Bill of Costs and Points of Reply, to conducting negotiations with the other side before advising on whether the claim should proceed to a Detailed Assessment Hearing, for which one of our in-house Costs Lawyers can provide representation.
Similarly for paying parties, we are well versed in preparing Points of Dispute and contesting legal costs claims, and on average we reduce any Bill of Costs on which we are instructed to oppose, by 40%.
We can be contacted via email at firstname.lastname@example.org, or by telephone on 01204 397302. For more information on legal costs, please find out more about our speciality areas of expertise and our services on our legal costs page.
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