Dispute Resolution – Costs

If you have tried, without success, to resolve your dispute via an Alternative Disputes Resolution (ADR) method you may have no choice but to issue Court proceedings. If the dispute related debt is straightforward and results in an Out of Court Settlement or swift conclusion, costs may be easier to contain. However, if the debt is complex or involves cross-border issues, litigation fees can quickly mount up. Our Solicitors will provide you with a firm estimate of the costs involved with going to Court to resolve your debt-related dispute. However, it is important to understand that litigation always carries a risk that you may be ordered by the Court to pay the other side’s costs if you lose your case.

What are the main components of litigation costs?

The costs of litigation vary depending on how complicated the debt matter is, whether there are any cross-border elements, and how much disclosure is involved. The basic costs you can expect will cover:

  • Solicitor and Barrister fees
  • Court fees
  • Expert opinion and reports
  • Other disbursements (expenses)

If you choose to appeal you will be subject to further costs.

How are costs managed during the litigation process?

On 1 April 2013, the so-called Jackson Reforms [1] brought in sweeping changes across the civil litigation landscape. The reforms introduced strict cost management procedures.

All parties to litigation (except litigants in person) must file and exchange budgets that estimate the costs associated with each stage of the Court proceedings.

The Court can make a Costs Management Order, which sets out the extent to which the parties have agreed or disagreed with the costs associated with each stage of the proceedings, approve the budget, or make changes to the parties’ submissions to ensure costs are proportionate.

Can I recover all my litigation costs if I win my case?

Even if you are granted 100% cost recovery on a successful claim, some costs cannot be recovered, and this mainly consists of the time taken away from your business, both physically and mentally, to deal with the litigation. We have over 30 years of experience in debt-related dispute resolution and will explain the non-intangible costs so you can make an informed decision as to whether or not to pursue Court action.

It is rare you will retrieve all your monetary litigation costs; there is usually a shortfall. This is because the Court will block costs that are disproportionate due to being ‘unreasonably incurred’ or are for an ‘unreasonable amount’.

Should I take out After The Event Insurance?

After The Event (ATE) insurance can cover your liability if an adverse costs award is made against you and can also cover disbursement costs. Our Solicitors can arrange ATE for you.

What matters most when it comes to costs is the quality of your legal team and the extent to which they understand your business and market sector. By developing long term relationships with our clients, we understand their appetite for risk and how to strategically run a debt-related dispute resolution claim.

1 In late 2008, Lord Justice Jackson was appointed to review the costs of litigation in the UK, as costs were often deemed disproportionate to the issue. Lord Justice Jackson’s report led to the reforms which bear his name.

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