What are Points of Dispute (Precedent G)

On conclusion of a legal case, the receiving party will be required to serve on the paying party a Bill of Costs with a Notice of Commencement. The Detailed Assessment procedure will begin at this point.

The bill of costs will set out the amount sought by the receiving party, and a deadline of 21 days from the date of service (usually 23 days in total) to contest the amounts claimed. 

The paying party does not have to accept the Bill of Costs as drawn, and can raise Points of Dispute. These are formal legal arguments against the amounts claimed, to reduce their costs liability. If the paying party does not send any points of dispute within the required time frame, the receiving party can apply to the Court for a default costs certificate.

However, in some circumstances, the paying party may apply to the court to set aside a default costs certificate.

Setting aside a default costs certificate

A default costs certificate can be set aside in specific circumstances, generally when there are valid reasons why the paying party did not file Points of Dispute within the required timeframe. Here are the main grounds under which a default costs certificate can be set aside:

Prompt Application:

The paying party must act promptly upon learning of the default costs certificate to apply for it to be set aside. Delays can weaken the application.

Good Reason for Delay:

The paying party must provide a compelling explanation for the failure to file Points of Dispute on time. Acceptable reasons might include administrative errors, miscommunication, or unforeseen circumstances that prevented timely action.

Meritorious Points of Dispute:

The paying party must demonstrate that they have substantive and valid Points of Dispute that could potentially reduce the costs claimed. The court needs to see that there are real issues to be contested, not just a delay tactic.

No Prejudice to the Receiving Party:

The court will consider whether setting aside the default costs certificate would cause undue prejudice to the receiving party. If the delay has not significantly disadvantaged the receiving party, the court is more likely to set aside the certificate.

Interests of Justice:

Ultimately, the court will consider whether it is in the interests of justice to set aside the default costs certificate. This includes evaluating the fairness of allowing the paying party to contest the costs and ensuring that both parties have a fair opportunity to present their case.

What arguments should you raise in Points of Dispute?

Each and every item in a Bill of Costs is subject to scrutiny and may be challenged however, to achieve the biggest reductions you may wish to target any ‘big-ticket’ items. 

Typically challenges to items such as hourly rates, proportionality of the costs to damages, and the level of Counsel fees and document time claimed will achieve the largest reductions. 

Technical challenges can also be made within the Points of Dispute in respect of the validity of the retainer to disallow the entirety of costs claimed.

What happens next?

Once you have prepared your Points of Dispute, the receiving party is entitled to raise Points of Reply within 21 days of receipt of your submissions. 

Negotiations can continue throughout the detailed assessment process and settlement can be reached at any time. 

However, if no agreement can be reached, the receiving party is required to lodge for a Court assessment of their legal costs within 6 months of service of the Bill. If a Detailed Assessment is required, a costs judge will make a decision as to costs.

It is strongly recommended that a payment is made on account of costs to reduce interest, which accrues at a rate of 8% from the date of the Order/agreement for costs to be paid.

How to prepare Points of Dispute

Practice Direction 47.8 states that:

“Points of dispute must be short and to the point. They must follow Precedent G in the Schedule of Costs Precedents annexed to this Practice Direction, so far as practicable. They must:

(a) identify any general points or matters of principle which require decision before the individual items in the bill are addressed; and

(b) identify specific points, stating concisely the nature and grounds of dispute.

Once a point has been made it should not be repeated but the item numbers where the point arises should be inserted in the left hand box as shown in Precedent G.”

Some tips for ensuring your Points of Dispute are compliant include:

• Ensure your Points of Dispute are in the correct format. Follow the structure of the Precedent G, to allow space for a dispute and reply, as well as a Cost Officer’s Decision for when it comes to the Court assessing costs.
• ‘Short and to the point’ means that any submissions you make should state concisely the issue you wish to raise, with evidence in support. Failure to abide by this requirement can result in the Court asking for Points of Dispute to be re-drafted.
• Refer to the parties as the paying party (preparing the Points and paying costs) and the receiving party (receiving the Points and costs).
• Assess whether the matter will proceed to a provisional assessment hearing (<£75,000) or detailed assessment hearing (>£75,000). Provisional assessments are dealt with on the papers only, and thus you will need to ensure all evidence is included within your submissions, as there will be no opportunity to elaborate at any later date.
• Begin your Points with points of principle such as proportionality or hourly rates which effect the whole of the Bill. Then turn to critiquing any specific items in the Bill, creating a new Point for each different item for which a reduction is sought. 

How Can ARC Costs assist? 

At ARC Costs, our experienced costs team of Costs Lawyers and Draftsmen always ensure that the best outcome in detailed assessment proceedings is achieved.

If you are the Paying Party, we can ensure your Points of Dispute will be compliant with the CPR and practice directions, and these are usually prepared within 7 days of instruction, unless the Bill of Costs is a higher value matter.

If you are the Receiving Party, we can also assist by preparing your Bill of Costs and negotiating your costs further by drafting Points of Reply in response to Points of Dispute.

We can be contacted via email at info@arccosts.co.uk, 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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