By Michelle Castle and Andrew Bailey -
Snapshot
- The exercise of the jurisdiction to make lump sum costs orders is increasing. In the NSW courts (in this article ‘the State courts’), the jurisdiction is being exercised more frequently in a range of proceedings and in the Federal Court, it is now the Court’s preference to make lump sum orders.
- Practitioners involved in litigation should be familiar with the circumstances in which such orders are available and understand the evidence required to support it.
- Expert evidence may or may not be required, depending on the circumstances.
Obtaining a lump sum costs order can be very useful at the conclusion of proceedings and save the aggravation, expense and delay of costs assessment (or taxation, in the Federal Court). However, such an order is discretionary and the Court must be persuaded that it is appropriate to make the order in all of the circumstances. Another relevant factor is forum: the Federal Court, under the Costs Practice Note (GPN-Costs), starts from the position that ‘[t]he Court’s preference, wherever it is practicable and appropriate to do so, is for the making of a lump-sum costs order’, where in the State courts there is no such presumption and the Court must be persuaded that it is appropriate to exercise the discretion.
Power
Most courts have statutory power to grant lump sum costs: s 98(4) of the Civil Procedure Act 2005 for the State courts which are governed by it, s 43(3)(d) of the Federal Court of Australia Act 1976.
