Background
This was the costs decision following the Court’s determination of questions referred by a costs assessor concerning the assessment of legal costs. The defendant succeeded on all three referred issues.
The plaintiff had argued that the costs agreement was invalid and raised disclosure issues. It submitted that costs should be left to the assessor or that there should be no costs order. The defendant sought its costs, relying on its success on the referred questions.
The Court’s Holding
Smith J ordered the plaintiff to pay 50% of the defendant’s costs of and incidental to the application, on the standard basis.
Although costs ordinarily follow the event, the Court exercised its discretion to reduce the defendant’s recovery. The plaintiff had unsuccessfully agitated the validity issue and effectively conceded two issues at the hearing, but arithmetical errors in the costs agreement had contributed to the dispute. There also remained a live issue about whether there had been full and adequate disclosure of increased costs.
Key Takeaways
- A successful party on questions referred from a costs assessment will ordinarily be entitled to costs.
- Errors in a costs agreement and unresolved disclosure concerns can justify a percentage costs order.
- The Court may determine costs of the referral itself rather than leave that question to the costs assessor.
Why It Matters
The decision illustrates the Court’s flexible approach to costs in disputes arising from legal-costs assessments. Success on the substantive issues remained important, but the defendant’s own errors in its costs documentation warranted a substantial reduction in its costs recovery.