Hello, my name is Darren Hackett Green. Uh This is film two on the dispute resolution course for SQE and this film is going to deal with the issue of costs, but a separate film uh which is film three, which deals with the issue of cost assessment, uh which is a separate matter considered, say in another, in another film as the SQE assessment criteria, we're expected to be aware of it's gonna go through uh in um turn nine. So you're looking at at costs as a general overview, the client's got a contractual obligation to pay all of the costs incurred in bringing or defending the claim in question. Obviously, that's subject to this type of funding agreement uh which is in place and we saw funding in the uh in the previous film. However, the clients may be able to recover a proportion of those costs from their opponents. Uh was the entitlement to such uh is established, the parties will attempt to endeavor to agree the amount of those costs of liability for those costs. And of course, if they can't agree that it falls to a court assessment procedure, which we're gonna look at in the, uh, next film. Two fundamental principles in relation to costs are the payments of costs by one party to another is at the discretion of the court. The court always has elements of discretion when looking at the sum to be involved in relation to costs themselves. But also the lo that should pay the winner's costs as a general rule. But of course, uh, that's changed slightly with the introduction of qu qualified one way cost shifting, which takes a bit of, um, getting your head around. But we'll look at that in a lot more detail, uh, later on in this, uh, in this film. So elements of discretion, we talked about the court having a discretion in relation to costs when it exercises its exercises its discretion, of course, required taking into account all of the circumstances of the case. But in particular, they'll bear in mind the conduct of the parties, whether a party has succeeded on part or all of its case, even if not wholly um successful and any offers, uh, generally not part 36 offers because they, uh, are dealt with under separate elements of a limited discretion. Let's put it that way. You'll see that in a, in a future film. When we deal with part 30 Sixes and the cost implications of that, the element of discretion really comes into, uh, offers other than those made by way of part 36 a party's conduct can include various matters, uh preissing con Preiss issue conduct as well, obviously post uh issue conduct, compliance or non compliance with preaction protocols, the reasonableness of the pursuit of a particular allegation or issue the manner in which they uh pursued or defended their claim or a particular issue. Sometimes it can be effectively if they've been obstinate or obstreperous in relation to the, the claim uh that can result in the court bearing that environment to exercises discretion as to whether it allows uh the cost of uh their conduct, whether the claims have succeeded in the whole or in part. And the issues of any adverse impact on that conduct obviously should be highlighted to the clients at the, at the outset, they should be aware, their conduct can actually influence uh the court's discretion in relation to the costs that they're awarded, right? Take a deep breath just in relation to quos qualify one way cost shifting, uh and how this applies. So it's applicable in all personal injury cases and that includes clinical negligence. If it's a nonperson injury case, don't worry about quo quacks won't apply. So it's only um personal injury cases where qu is relevant definition of quack is, the claimant will not have to pay the defendant's costs if the claim fails, but the defendant will have to pay the claimant's costs if the claim succeeds. So that gives an element of confidence to a claimant who's pursuing uh their claim and knows that if ultimately, that claim isn't successful, they're not going to face a, a large cost bill on the defendant in having to defend that claim to, to conclusion. And of course, if the claim is successful, they recover their costs from uh the defendant as the losing party. Now that uh application of qu we've seen um and looked at this in relation to funding and whether does it potentially reduce the need to purchase after the event insurance premiums to actually support the nature of a conditional fee agreement with your clients? Generally not. Of course, because as we've seen, you still have risks when cos won't apply all the exceptions behind that and that will be protected by the after the event insurance uh premium. There are exceptions to um what the exceptions are where the claim is uh found to be fundamentally dishonest whether the claim is for the financial benefit of another. So for example, uh credit high as a good example of that where the claim has been struck out, but the claim discloses no reasonable cause of action. So when you're bringing a claim, even though you think on, on the claimants, if I lose them, there's no risk of paying the defendant's costs. However, there still has to be a reasonable cause of action there. You can't just try it on with any case and things and think that quo applies. There's no risk involved there with the claims and abuse of the court's process. There are exceptions as well in relation to how part 36 applies in relation to qu which we'll look at in a bit more detail on that. So how does quos work then? So the rules permit cost orders to be made and enforced against claimants, but only to the extent that those costs do not exceed the total damages that the claimant recovers. I'll explain that in a little bit more detail in a moment. So orders are costs made against a claimant may only be enforced after the proceedings have been concluded and the costs have been assessed or agreed. Right? So what that means is when we're dealing with a claim where qu supplies, then in essence, what happens is you have to wait to the full conclusion of the claim before we consider the impact of quos and how that works. Now important. Um rule there, as you said is that um cost orders to be made in force against claimants, but only to the extent those costs don't exceed the total damages, the claimant recovers. So how that would work is if maybe during the course of um the litigation, you as the claimant have made an application. Um So let say for an interim payment for our argument's sake and that application was unsuccessful. And as a result of that application being successful, then uh costs follow the event. So the loser uh will pay the winner's cost. That's the general rule in relation to the whole totality of litigation following a trial. But also it works the same way when we're looking at applications as well. And that example, payment makes the application for interim payments that's unsuccessful because the defendant opposes it successfully. The defendant then says, well, we incur costs in opposing this application, we've been successful. Therefore, our costs uh require paying an assessment how it will work following a uh an interim application hearing is as a summary assessment of those costs. So the defendants will file what's called an N 260 statement of cost which sets out the costs. They wish to claim. The court will look at those, consider the nature of the application, the work involved and assess them. So it's done basically on a just a provisional basis. So the court will look at the schedule and say, ok, 0 2500 has been claimed. It's a little excessive here there here. Therefore, um the defendant is awarded 1500 pounds. So there's 1000 pounds knocked off the, the claim made. How Quas work in that situation is those costs will not be payable. Normally, those costs are payable within 14 days. That's how the usual rules work in relation to adverse costs orders. But when we've got Quas applying, they're not payable at that point. But you have to wait until conclusion of the claim before you look in relation to the liability for those costs. So the cost rules uh in relation to quarks are that the defendant's right to costs cannot exceed the amount awarded to the claimant by way of damages. So if we look at that example, um which I just gave in relation to the interim application, let's say, for argument's sake, we get through to a triumph and the defendant um is awarded, I don't know, 1250 pounds at whatever reason, something goes awry in relation to the evidence. So what will happen is the defendant will then say, well, we've got a costs order here for 1500 pounds. But because quo supplies, what that means is that the defendant's ability to recover their costs is limited to the claimant's award, which basically means they only be able to recover 1250 pounds of those 1500 pounds as assessed. Ok? Because the claimant has been awarded 1250. And that's always going to be the maximum liability the claimant has for the defendant's costs. The idea and the thought process behind it when we're looking at the box is that the claimant can walk away with zero but never walk away with a minus figure. If we play it. Another way, say for argument's sake, the claimant recovers, I don't know, 11,500 pounds by way of damages. The defendant uh has his cost order of 1500 pounds. That's fine. Basically, the claimant has recovered 11,500 then we've got the 1500 so that the aggregate sum in relation to the damages is weigh in excess of those costs. So the defendant can recover their costs in full as they had been uh awarded earlier. That's the uh first application how costs works in relation to uh the extent of these costs orders. So um that's a general application in relation to you've got a cost order that somehow follows you even normally funding an application. What about part 36 offers? And if we look at part 36 offers um at a later stage in relation to the benefits and detriments of them and the ramifications if you fail to beat or an uh an offer that's been made by a defendant, how it works in relation to part 36 offers is the same way the same principle uh applies in relation to that liability. So I don't want to go through part 36 in a great deal of detail. Cos we, we see that in a later film, but how it works is the defendant makes an offer. There's a relevant period there, the offers outstanding for 21 days and after the end of that period, the general rule is if the claimant fails to beat that offer, the defendant is entitled to their costs on the standard basis from the 22nd day to the end of that relevant period up until the point um, that it's accepted or uh we have uh a final adjudication there, a trial. So in that situation, say, for argument's sake, the defendant offers 10,000 pounds and then the matter proceeds to trial and the claimant is awarded 9000 pounds. First thing the defendant is going to do is request their cost payable from the 22nd day. Um, through to the conclusion of the matter, those costs at the um trial will then be assessed by the court. Cos that's the important thing. The costs need to be assessed first in relation to the liability. Before we look at the application of quos say if those costs are uh assessed at 10,000 pounds, what we're aware of, of course, in that situation is the claimant has been awarded 9000 pounds even though the costs are assessed at 10,000 pounds. The defendant's right uh to recover costs is limited to the 9000 pounds. It can never recover more than the claimant has been awarded for their damages including interest. Ok. However, of course, if the claimant, uh if the costs are assessed at 5000 pounds, we know the claimant's recovered uh been ordered 9000 pounds and of course, at 5000 pounds is recoverable in full. So what we're looking at there is whether or not it's a cost implication following a successful part 36 offer or whether it's as a result of costs orders throughout the course of litigation, the defendant's right to cost is limited to the award made uh for the claimants. So that's important provision in relation to quos things get a little bit more complicated when it comes to fundamental, um, dishonesty. Fundamental dishonesty is that element where the claimant is not exaggerated or done something in relation to their claim, which means they've been untruthful. So there's a finding of what's called fundamental dishonesty at the, at the trial, if you think about fundamental dishonesty in two ways, one where the fundamental dishonesty is, um, one discrete aspect of the claim that's been brought. And the other way, we've got fundamental dishonesty as a whole. The fundamental dishonesty as a whole issue is probably easier. So what you're looking at there is where we've got a staged accident. So where effectively the claimant of the defendant, uh, maybe they've been involved in the same incidents, the claimants intended for the accident to occur just to recover damages or another one who is quite common is fom passengers where we've got, uh, claimants and defendants, um, don't know each other involved in a vehicle incident. And then after the accident, uh, that we get a plethora of claims for alleged passengers in the claimant's vehicle. And the defendant says there's only one person in there, only one person in that vehicle and not all these other people. So what's happened is the claimant's got his mates on board to say, pretend you're in the car, Phantom passenger, you get yourself some uh, money for damages. That's because the nature of the fundamental dishonesty is as a whole. It's in essence, it's a fraudulent claim. Then there's no uh limitation in relation to the cox. Uh, the, the costs cocks doesn't apply in that sense. So what you're looking at is in essence that if that claim then fails, then because it's an exception and fundamental dishonesty, the defendant will be entitled to their costs in full. No limitation in relation to that. The limitation in relation to fundamental dishonesty over one discrete issue gets a little bit complicated. So if we had a situation, say for argument's sake, where we have a claimant who's pursuing a claim for personal injury. And on top of that, they're pursuing a claim for gardening. They're saying because of the nature of their back injury in the road traffic accident, they couldn't mow the lawn, they had to employ a gardener. And then at trial, it comes out that the claimant lives in a, uh, a second floor flat hasn't got a garden that's all got a window box at best. So the gardening claim is a complete, uh, complete fake. And so for this element, so that is fundamentally dishonest because it doesn't exist, the claims only making it up. So, you know, to get an increased amount of damages, however, on, uh, what you have to bear in mind, of course, is there is a viable claimer, the claimant was injured in the accident. So how fundamentally uh fundamental dishonesty works there. So even though the claimant had a genuine claim, which was the injury duty accidents, because he's had this element uh, of fundamental dishonesty. So effectively made up this, this gardening claim, the claimant lose completely and we'll get zero. And that's how it works. The element of fundamental dishonesty, even it's over one discrete issue doesn't mean needs to be over the whole of the loss could be one discrete issue. An element of fundamental dishonesty means the claimant gets zero covers nothing by way of damages. How quo works in that situation is a bit of a, uh, an extra kick to the, the teeth of the claimant is that the court will then go on to make an assessment, uh, an assessment in relation to had the claimant not been fundamentally dishonest, what would they have been entitled to? So, in this situation that given you, we've got the injury and we've got the gardening. So when we look at the injury, if the court thinks well based upon the medical evidence and what we've heard, the claimant would have been entitled to 10,000 pots for that injury. Of course, the claimant gets zero because of the elements of fundamental dishonesty. What will happen then is the defendant will say, ok. Right. Um Quacks fundamentally is honesty. Would like our costs assessed, please. So what happens is those costs are then assessed exactly like you would do following the part 36 following any of the elements we've looked at before with quacks. So then the developer will be awarded their cost once assessed, let's say for arguments sake, those costs are assessed of 15 pounds and pounds. What can happen is the sum which would have been awarded to the claimant, had he not been fundamentally dishonest is deducted from the sum of money awarded to the defendant for their costs. In essence, that fundamental dishonesty means the defendant has made a saving in relation to a genuine element of the claim that's been brought and effective. You recognize that that genuine element is deducted from the defendant's right to costs. So that example I gave you, uh, the court says that the claimants would have been awarded 10,000 pounds for their injury. We've got the defendant's costs assessed at 15,000 pounds, that 10,000 pounds is deducted from the 15,000 pounds which leaves 5000 pounds as a balance which the defendant can then pursue as against the claimant and or his insurers. Sometimes it doesn't work out that way and that a defendant ends up with nothing. So for argument's sake, if the claimant's cost, uh, damages were to be assessed, like I said, at 10,000 pounds. And when the defendant has their costs assessed, that also equals 10,000 pounds, they don't get any costs but effectively the damages would obliterate um the the cost that um could have been sought, right? So that's how quarks works. It can get a little bit um complex I accept. But just if you try and imagine there's different elements involved and think of trying the fundamental principle in relation to one's not involved in fundamental dishonesty where the idea is, the claimant can walk away with zero because the aggregate damages award uh but will never walk away with a minus sum, right? Taking costs a little bit. Um Further now, be aware of the indemnity principle, the indemnity indemnity principle is where the winning party cannot recover more from their opponent than he's paid to his legal representatives. So the idea there is without a valid retainer, there's no right for the client to have a liability to cost and no right to pursue a claim for costs. We saw with um funding the previous film in relation to how the indemnity principle works. Of course, that if you had a damages based agreement, which says that the um claimant is liable for 20 25% of his damages, that's the uh limitation on the cost he held to his solicitors. And that basically means that 25% of the claimant's damages is the maximum that the solicitors can pursue again as against the defendant because of the nature of that funding agreements in place. That's the application, the indemnity principle. You're also aware of the basis of assessment of costs. There are two basis for assessment standard basis and the indemnity basis. So standard basis is a general basis. The is the default position in relation to how costs are assessed. So what the rules are in relation to that only proportionate costs are allowed and any doubt in relation to those costs is resolved in the paying parties favors the party paying the costs, indemnity. Uh basis actually sweeps that about a it in relation to the fact that proportionality isn't taken into account. And also any doubt is resolved in the receiving party's favor. That's the indemnity basis. Either way the costs need to have been reasonably incurred, you can't avoid that. That's always the, the, um, what position, um, generally standard basis is the normal order. You'd have, you see indemnity basis orders when you're looking at elements of punishment. So almost when you're looking at a punitive award for costs, that could be basically on the grounds that the, uh, claimant takes issue with something the defendant has done or hasn't done during the court litigation and argues for the fact that the cost should be on an indemnity basis to show the court's dissatisfaction with the defendant's conduct just as an example. And of course, with part 36 offers, if the claimants have been successful in, uh, beating that part 36 offer, they were entitled to cost on the indemnity basis. But we'll see that when we look at part 36 and offers separately in a different film. So in deciding the amount of costs, the court will take into account lots of um different issues, conduct pre and post issue um efforts made. With regards to alternative dispute resolution. We look at that specifically in the Tahi dispute resolution film. Uh the amount of money or property involved uh importance of the matter to the parties, complexity, the skill effort, specialized knowledge and responsibility involved the time spent the work done on the file uh where the work was done and also any app uh approved or agreed budgets. We we'll look at budgeting in a moment in in relation to what that is as a separate set of rules with regards to how um the court looks at the future management of costs during the course of litigation. Uh The mere fact that the costs have been necessarily incurred doesn't make them proportionate, disproportionate costs will not be allowed even if they have been necessarily incurred. Uh The rules defined proportionate costs in that they should bear a reasonable relationship to the songs at issue, the value of any non monetary relief, any complexity and the additional work generated by the conduct of the paying party portions as you'll see throughout and dispute resolutions are really, really key and core elements, not just in relation to cost but also in relation to uh elements of uh what experts you're allowed to instruct how the case is progressed and the court allows the case to be progressed and case managed. So budgeting important elements. So all multi track cases are budgeted and it's the way the court controls the uh future costs of the claim, how it works is that at the point when costs are budgeted, uh the court will look at different elements involved in the budgeting process. And when I say different elements, different phases of the course of litigation phases, like disclosure, expert evidence, witness evidence, and what each party will do is produce down what sums of money they would like to spend within that given phase and what the court does is look to the future costs. So there's stuff that the costs have been incurred to date. The court won't look at it doesn't matter uh in, in the budgeting phases. Of course, it matters at conclusion when the costs are assessed and the court will look at the future um costs. The purpose of these budgets uh is the parties would exchange them and try and agree them prior to any ca uh cost and case management conference. And it's the CCM CS where the court will look in relation to the budgets themselves and what order to make. Uh sometimes even if the parties do agree, um the budgets, the courts can still get involved. Although you tend to see if the parties are in agreement, the courts tend not to get involved in relation to the the, the budgeting exercise. So the budget itself is on uh a form called a precedent. H I'd be aware of the different forms. Um I think the more common form is president A H, that's your cost budget. There's also a President R and a precedent. T I'll let you know what those are uh as we go through these slides and uh throughout this film. Um but I think uh they're not an end, but I think it's worthwhile being aware. Recognizing the, the terminology, I'm not sure if sqe would use just the term budget or they'd use a specific form, the present age form, you complete this present age form. And the idea behind it is say, for argument's sake in each phase, let's look at disclosure. You as the, the claimants uh will say I'd like 20 hours um for uh time for future time spending on disclosure, you then get to uh back and forth with the defendant who may say I'll give you five hours or agree. Five hours. You disagree. Goes to the court of the CC MC. Could we look at matters, consider the issues, consider work done to date? I mean, how much work have you done on disclosure already? And then they'll give you an order. Uh It may be the fact that they go 20 hours is fine. You can have 20 hours or alternatively, no, you, you can have 15 hours. What that means then is, um it doesn't mean it means you stop at 15 hours can do no more work in relation to the element of disclosure. It means that your cost recovery is limited. So anything up to 15 hours, you're fine, you'll be able to recover the cost in relation to disclosure on that. Anything over and above that is dead time. You won't be able to recover that as part of the uh the cost process at conclusion. So, um as I said before you exchange these budgets, of course, if you're a litigant in person, you still need to give the litigants in person the budget if you're a legal representative, but the litigants in person don't do that because this is legal representatives costs two rules uh to be aware of. Um And it's very important to understand this is when your budget needs to be, when your present h needs to be served and filed. So where the stated value of the claim and platform is less than 50,000 pounds, your budget, your press mh has to go with your directions questionnaire. Uh Any other case or the case is worth £50,000 or above. Uh It has to be not later than 21 days before the CC MC. The cost and case management here and be aware of that. Um We're looking really to be sanctions in relation to what happens if you don't do that when we have um budgets then exchanged uh what you also have is within seven days of the, the listed hearing the CC MC. The parties have to follow what's called a budget discussion report. It's a precedent R, in essence, the President R, if you think of it this way is a bit like a defense to the budget. So what we happen is, you know, if you act for the defendants, you will get the claimant's precedent. H have a look at each of the phases and what they're claiming and then you'll respond formally on this precedent. R so on that disclosure example, and claimant says we've got 20 hours, please use the defendant go back and say five hours but justify it saying for, for, for example, they've already spent 20 hours so far um prior to litigation or it's not a particularly complex case, the majority disclosure has taken place or disclosure is limited down to quantum only. So liability isn't an issue, whatever arguments you want to raise and you set those out upon President H President R sorry. And then what happens is when the court comes to assess um the, the costs and, and uh what is allowed by any party to be recovered as part of the budgeting process. The court will have regard to both the present and the present RS which have been completed. Uh Every budget must be dated, it has to be verified by a statement to truth as well. There is a sanction if you don't file your budget on time. So we saw that earlier where it's um, less than 50 K with your directions questionnaire, uh 50 K or more at least 21 days before the CC MC. If you don't file your budget within those parameters, you find it late, then the sanction which applies automatically is that your um, costs, um, budgeted will be limited to future court fees only. That basically means the only cost you're entitled to recover will be court fees. That's a sanction. Uh We'll see later on in these films when we look at specific applications, what happens in relation to sanctions and how you avoid a sanction. But in essence, what you need to do in that situation is make an application for something called relief from sanctions. If that applies. The idea being is you accept there's a sanction that applies, you want to avoid the application of that sanction. So you make this application to court if 84 on your sword apologize and get the court's permission to rely on the budget without that sanction applying. So we have these cost management orders. So the CMO uh is the court order as to the sums the parties may recover during the course of the uh litigation based upon the budgets they filed. If the party's costs exceed the sum allowed under the budget, then the onus is on the party to seek approval of a revised budget uh to add to the confusion, the revised budget for the additional costs over and above that, that's previously been agreed is a presidency. So President H is a cost budget. President R is your response to your opponent's cost budget. And if you want to get more costs then to vary the budget that's been agreed, then president see that additional claim for further costs. Um Generally speaking, it's tough. Um and even if you go outside of the budget, you're not gonna get anywhere with it. The only time when you're gonna be successful in relation to uh uh asking for further costs on top of what has already been budgeted is whether there's been a significant change in circumstance. So arguably that could arise out of some medical complications. Maybe the claimant's condition has deteriorated significantly in a personal injury claim. Um It could be where the defendant serve surveillance evidence upon you. So therefore you need to respond to that surveillance evidence. Uh speak to the experts draft expert evidence, draft a witness statement in response things that weren't foreseen at the time that the budgeting exercise took place, uh approved budgets, the idea behind them, it gives the parties less scope to challenge costs. So it comes to conclusion when you're looking at claiming your costs and if you have been allowed 15 hours for disclosure and within that phase, but of cost, when you set out what your totality of your claim for costs is following settlement of the matter, you say 14 hours under the disclosure um umbrella, so to speak. Um, there's no argument there. You've been allowed 15 hours, you've incurred 14 hours, that's it done and dusted. Um There's no argument to be raised in relation to that or certainly the defendant are not going to get anywhere at all. You're trying to raise an argument that you've spent less than what you've been budgeted to um uh to a group. Um Again, the court shouldn't depart from the budget uh without good reason. So for argument's sake, if you are limited to 15 hours, doesn't stop you trying to claim 20 hours um for the disclosure phase for argument's sake, but you're not gonna recover the additional five hours. And again, the court won't depart from that ordered budget approved budget without good reason. Be aware of um wasted costs. There are different elements uh in themselves. So different from indemnity basis costs, but they are looked at as a punitive um cost order. They're cost orders where the conduct of the legal representative has been shown to be improper, unreasonable or negligence. Uh And the above finding of a wasted costs order uh results in the legal representative paying his own client's costs of those the opposing party. What we're looking at there is where there's been an error made by the legal representative is their conduct which has caused some additional cost to be incurred. Therefore, a wasted costs order is appropriate. But the uh, elements of a wasted costs order means that the um, claimants will the defendant, however, it is, won't be able to go back to the fund. They won't be able to go back to the before the event insure and say, look, we're going to add this costs order here. Can you play it? Pay it, please? It's a wasted costs order. It's due to conduct. So, therefore, it's just uh, a fee that's a cost that the firm in question will just have to suck up uh and write off the burden in relation to a wasted costs. Order rests with the applicant. So if you are the defendant, you're unhappy with the claimant's conduct, you want to wasted costs order. The burden is with you to prove that a wasted costs order is appropriate factors to be considered in relation to that application. The legal representative must have acted improperly unreasonably or negligently, their conduct must have caused the party to incur unnecessary costs and it must be just to make the order just as a, a pause there. We're gonna see that word just come up now with regards to security for costs and with regards to non-party costs, orders as well. So just park that and just um firm that up in your mind. The word just is very relevant for the next three different types of um of costs orders. Um If a wasted cost order is made, then the legal representative has to notify the client within seven days of the date they received notice of that order. Next, we have um security for costs. So an order for security for costs protects a party after the defendant uh against the risk that they'll win at trial and be awarded that costs. But then they're not able to enforce a costs order against the other losing party either within the jurisdiction or abroad. So the defendant has got concerns that uh when the claim is brought against them, if they are successful in defeating that claim, and then they are entitled to their cost because the loser pays the winner's costs. The claimant has no money um, to pay those costs. The order for security to be given if complied with will provide a fund available within the jurisdiction against which the party usually the defendants who obtain the security order can then enforce any costs order. The idea is the, uh if successful, the claim would, will set aside a sum of money there. In essence, if they are unsuccessful in the claim, then the defendant can dip into that with regards to their costs. The idea is the defendant will proceed with the litigation. Happy to know they've got security for costs. So if things go the way they anticipate they're going to go and they're successful, they can claim their costs from that fund. The claim may be stayed. Uh And so it can't continue until the security is provided. So if the um application for security for costs is successful, there's a stay on it until that claimant has provided that security for costs uh with any application, uh an application for security of costs must be supported by written evidence. Um where the court makes an order for security for costs, it determines the amount of the security and directs the manner in which and by when the security must be given, usually a, a sum paid into court. And obviously look at the sum involved in relation to that. When looking at the sum involved, of course, the defendant will make representations in relation to what their likely costs are going to be in pursuing the matter to conclusion assuming of course they are successful and the claimant's claim is defeated and that's the sum that we're looking for in relation to that security. The court may make an order for security for costs if it's satisfied having regard to all of the circumstances of the case, it is just to make an order again. That was the cost just is an important consideration here. Also, the claimant is resident out of the jurisdiction. Uh The claimant is a company or other bo uh body we incorporated inside or outside of Great Britain. Uh And there's a reason to believe it will be unable to pay the defendant's costs if ordered to do so. Or the claimant has changed their address since the claim was commenced with a view to evading the consequences of litigation or the claimant gave an incorrect address in the uh claim form itself. The claimant has taken steps in their, uh, in relation to their assets would make it difficult to enforce an order for costs against them. So what we're looking at here to justify that order is things that the claimant has done, which would be indicative of the movie hiding money avoiding any potential liability. Should they be on success for any claim that they've made, they've made? So also, uh, we have non-party costs orders. So the court has jurisdiction, um, to award the cost of litigation to be paid by a non party. Um, such an application should be given consideration if it looks as though an unsuccessful opponent does not have the funds to pay an adverse costs. Order doesn't have the funds. Maybe he doesn't have any insurance which will support the, uh, that claim cost orders made against non parties are exceptional. They're not particularly common. Um, but that simply means they're no more than slightly ordinary run of cases where parties pursue a defense claims to their own benefit at their own expense. The ultimate question like we seem to be wasted costs like we've seen for security for costs is whether in all the circumstances, it is just to make the order discretion won't be exercised against what's called pure funders. So those with no personal interest in the litigation who do not stand to benefit fit from it are not funding it as a matter of business and in no way, seek to control its course, they're classed as pure funders. So literally all they've done is fund the litigation and a step back and nothing else apart from that. However, where the non party not really funds the proceedings but substantially controls or any rates to benefit from them. Justice would ordinarily require that if the proceedings fail, they will pay the successful parties costs. So that's, that's looking at a sort of litigation funding where in some circumstances, uh a company will support the um cost of proceeding with litigation with a view that if it is successful, they'll take a substantial percentage or cut of the damages awarded. So, in that situation, because they're taking the cut of the damages, if they are, uh, if the claim is successful in the claim, they're not a mere pure funder because of course, they've got a benefit, they're seeing from that litigation, they're gonna make money from that. And it's in those circumstances when the court maybe might need to make a non-party costs order. The procedure in relation to a non party costs. Order is a two step process. Basically, the non parties added as a party to the proceedings for the purposes of costs only. And the non non party must be given an opportunity to attend a hearing at which or, or consider the matter further. Right. Let's try a uh a question in relation to this area. She acts on behalf of the claimant in a claim for breach of contract. The claim total is 100 and 50,000 pounds and has been allocated to the multi track. The defendant is a litigant in person. AC C MC has been listed for the 20th of April on the sixth of April. The claimant filed and served a president H. The claimant did not file a president R. What is the likely cross budget? In order at the CC MC A, the party's cost budgets will be considered at the C MC and the order will uh sorry and the court will order the sums that may be recovered by each party in the respective phases claimed upon the president hb that the claimant's claim for costs is limited to court fees only c that the claimant's claim for future costs is limited to court fees only d the claimant's cost budget will be considered at the C MC and the court will order the sums that may be recovered by the claimants in the respective phases claimed upon the president H and A that the claimant's claim for future costs is limited to court fees only as a claimant did not file a precedent r correct answer is c that the claimant's claim for future costs is limited to court fees only uh with um dispute resolution. And certainly looking at multiple choice questions. If you're given a date, likelihood you, you're given a date for a reason and that would tend to be around non-compliance or something like that. So do just pick up on dates seeing from this question, the date you're given for the CC MC and the date when you filed your president H you have to file your president h your cost budget. Uh in light of the fact that the case is worth 100 and 50,000 pounds. So it's 50,000 pounds or more. Of course, if it's less than 50,000 pounds, your present H is um filed with your directions questionnaire. But in this situation because um it's 100 and 50,000 pounds or 50 K or more, then your present H has to be filed and served uh at least 21 days before the CC MC. It wasn't um 20th of the CC MC. I think you filed it on the sixth of April. So you're late in essence and because you're late, a sanction applies and that sanction is your claim for future. Um, cost is limited to court fees only. So what about the others? Uh questions. So, uh a the party's cost budgets will be considered at the C MC. So, and the court will order the sums to be recovered by each party in their respective phases claimed upon the President H. That's um incorrect. Obviously, because effectively we've got this um sanction which is applied because of the late filing service of the president H but also that's also wrong because it refers to the parties. And as we know, we've got a litigant in person here. So the only party who's actually filing the president H is the claimant in this action. Uh B the claimant's claim for costs is limited to court fees only that's incorrect because it's, the future cost is limited to court fees only, not all of the costs, just watch the wording there. Um D the claimant's cost budget will be considered AC MC and the court will order the sums that may be recovered by the claimant in their respective phases claimed upon the president H. That's correct if you'd served it on time. Uh That's the usual order that you um get, um, however, you were later serving it. Hence, that's why c is the correct answer. And either the claimant's claim for future costs is limited to court fees only as the claimant didn't file a precedent are a present are, which is a response to the, uh the cost budget is the president H and the failure to file that which has the sanction. But also if you're the claimants with the litigant in person, you will not be filing the president R because the litigant in person won't file the president, H won't file a budget. So therefore, there's nothing for you to respond to in relation to that. Brilliant. Thank you very much.