There is nary a mention of the cost of litigation, or the financial consequences of winning, or losing, a case, and yet that topic consumes much of the conversation that real clients have with real lawyers. A real court case is a daunting exercise in risk management – is the prize worth the cost, or the risk of an adverse result?

This blog addresses the topic of ‘court costs’.

In Simple terms, court costs are amounts awarded by the presiding judge to the winning side in a Supreme Court lawsuit, to assist with the winner’s legal fees  (court costs ae not awarded in the lower courts – Small Claims or the Dispute Resolution tribunal).These costs are calculated with reference to a table found in the Supreme Court rules that assigns a value for each step taken in a case, from inception to judgement. and are further fine-tuned taking into account the complexity or difficulty of the case and the amount of time involved.As a matter of public policy, court costs  deliberately fall short of fully covering the winner’s actual legal expense, so one is lucky if one receives a costs award equal to even half of the actual expense of the trial.

The rationale for providing less than a full indemnity for a successful litigant’s legal expense, is to encourage compromise. Even if you have a strong case (or merely think you do) you will pay a price by proceeding with a trial, so need to consider the utility of an out of court settlement, even if you receive only most of what you want, and not everything.Providing a financial disincentive to the use of the courts by well funded litigants to bludgeon weaker players, helps to level the legal playing fields, and promote the more efficient use of our scarce judicial resources.

Of course, nothing in law is ever simple, and lawyers will haggle over pretty much anything, so in practice, the award of courts costs isn’t nearly as straightforward as saying “if I win the nasty defendant will pay half my legal bill.” Firstly, most matrimonial cases deal with multiple issues- custody, access, division of the family property, and so forth. It is not uncommon for a party to prevail on some issues, and come away disappointed on others, so who was the overall winner? Judges are often forced to referee- what were the most important issues in the case,and  how much of the case was devoted to resolving those issues? So, split costs awards can arise, as can situations where truly nobody won, and the judge is fed up with everyone in the courtroom and declines to award any costs at all.

The table by which court costs are calculated provides additional opportunities to haggle – was every step necessary, and every disbursement claimed a proper one ? Was the matter highly complex, or merely routine? Was your expert witness really worth what you paid him?

Another layer of complexity is added by the provisions of the rules which ‘weaponize’ court costs- permitting extra costs to be levied against stubborn litigants who proceed in the face of a reasonable settlement offer, and do no better at trial, and by the discretion which is reserved to judges to police their courtroom by awarding punitive costs against egregious litigants.

Court costs are an important component of any court case, so its no wonder we spend so much time talking with our clients about them – even if it might make for dull TV viewing.