Taxation of Bills of Costs and Review

Instead of ordering fixed costs, a Court may order that costs be taxed. This means that costs are awarded to a party but the quantum of the costs is not fixed and is to be determined by the Court at a Taxation hearing having consideration to a Bill of Costs filed and the objections raised.

There are two bases on which costs may be taxed:

Standard basis - the Court shall allow a reasonable amount for all costs reasonably incurred, and any doubts as to whether costs were reasonably incurred or reasonable in quantum shall be resolved in favour of the paying party; and

Indemnity basis - the Court shall allow all costs except for costs which are of an unreasonable amount or were unreasonably incurred, and any doubts as to whether costs were reasonably incurred or reasonable in quantum shall be resolved in favour of the receiving party.

Bills of Costs filed may relate to:

Party-and-party costs These are the costs which the losing party in an application or action is ordered to pay the winning party. The Court may either order the party-and-party costs in an action to be taxed or fix the party-and-party costs. Unless the Court orders otherwise, these costs are taxed on the standard basis.
Solicitor-and-client costs These are the costs which a party has to pay his lawyer for legal services rendered. Solicitor-and-client costs are usually governed by an agreement between the party and his/her lawyer. In general, these costs are taxed on an indemnity basis.

Both the solicitor and client can consent to taxation of the solicitor’s bill. Where there is no consent to the solicitor’s bill, an order of Court for the taxation of the solicitor’s bill has to be obtained within 12 months from the delivery of the bill.

The Taxation Process:

Within 12 months from the date on which the proceedings (including any appeals) are finally concluded, the receiving party shall file a Bill of Costs which should list the costs payable by the paying party; the Bill of Costs shall be in the form prescribed in Paragraph 94 of the Supreme Court Practice Directions.

A hearing date will be fixed for the taxation of the Bill of Costs and this is usually at least 14 days after the filing date of the Bill of Costs (“Taxation hearing date”). A copy of the Bill of Costs is to be served on all parties entitled to attend the hearing 2 days after issue by the Court.

If the paying party wishes to object to the Bill of Costs, he must e-file a Notice of Dispute in Form 19 of the Supreme Court Practice Directions at least 7 days before the Taxation hearing date.

On the Taxation hearing date, the parties who wish to be heard on the Bill of Costs will attend before the taxing Registrar.

The amount of costs to be allowed shall be at the taxing Registrar’s discretion. In exercising his discretion, the taxing Registrar shall have regard to all relevant circumstances, including but not limited to:
  • Any payment of money into Court and the amount of such payment;
  • The conduct of all parties, including conduct before and during the proceedings;
  • The parties’ conduct in relation to any attempt to resolve the matter through mediation or any other form of dispute resolution;
  • The extent to which parties followed the applicable relevant pre-action protocol or practice directions issued by the Registrar; and
  • The complexity of the cause or matter and the difficulty and novelty of the questions involved.
Any party who is not satisfied with the amount of costs granted by the taxing Registrar may file an application for a review by a Judge sitting in the General Division of the High Court in chambers within 14 days after the taxing Registrar’s decision.