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“Costs” – The Least You Need to Know

The term “costs” is thrown around by lawyers and clients alike. What does it mean? What can you actually expect in terms of costs if you are successful in court? The law of costs can be complex.  This is only the very tip of the iceberg in terms of what it is all about.

First let’s define terms.  What you pay your lawyer are fees, disbursements and GST.  “Costs” means an amount that can be awarded by a Court (or arbitrator) against a party in certain circumstances.  That amount is payable to the other party.

There are two main types of costs:

Party and party. Party and party costs can be whatever a Judge says they are but often follows a specific schedule set out in the Rules of Court. The schedule provides an amount payable for each step specified in the schedule.  Party and party costs are NOT full repayment of what you paid your lawyer and often are only a fraction of that amount.

Solicitor Client. Solicitor client costs are what you pay your lawyer.  Costs at that level are not generally awarded against a losing party except in certain circumstances.

The usual award of costs is in recognition of one party winning and the other party losing. 

Keep the question of “costs” in mind right from the beginning of a case. And at each stage and all the way through.  It can be a significant consideration and impact one’s approach and strategy throughout. The concept of “costs” is that it should give parties incentive to settle their case in a reasonable way and to conduct the case in a reasonable way.

Costs can also be increased if there was an offer made by a party and the result obtained is better than the offer.  In certain circumstances a party may be entitled to double costs.

A threat to the other side that “you will be paying my lawyer’s fees” is often hollow.  But on the other hand Courts can and will award costs in appropriate cases to a successful party.

Our lawyers can guide you through this issue to ensure that you are making decisions and proceeding based on correct information. If you have any questions about the law of costs please contact us to discuss.