Costs orders in UK civil court explained

In UK civil law, costs are not always split 50-50. Instead, courts make "costs orders" that tell you who pays the legal bills. The golden rule is simple: if you lose, you usually pay the winner's costs. But the rules vary by track, and there are many ways to challenge this outcome.

This guide explains how costs orders work, what you might pay or recover, and how to manage your exposure.

The short version

• The "loser pays" rule is the default in UK civil courts (CPR Part 44)
• Costs vary dramatically by track: small claims are capped; fast track has fixed costs; multi-track has no limit
• Before trial, you can make a "Part 36 offer" to settle; if the other side rejects it and loses, they pay higher costs (interest and indemnity basis)
• Courts assess costs on "standard basis" (only reasonable, necessary costs) or "indemnity basis" (almost everything you spent)
• Litigants in person can recover a "costs allowance" but not their own time
• Costs orders are made at every stage, not just at trial

At a glance

The general rule: loser pays (CPR Part 44)

The Civil Procedure Rules Part 44 sets out the fundamental principle: the court must make a costs order, and normally the loser pays the winner's costs.

However, "normally" is the key word. The court has discretion and will consider:

• Whether the losing party acted reasonably
• Whether the winning party incurred costs that were proportionate to the value and complexity of the case
• Conduct of all parties before and during the proceedings
• Any part-success by either side

If you behave badly, or if your legal team runs up massive bills for a small claim, the court may reduce what you can recover, or order you to pay more.

Small claims track costs (very limited, no advocacy fees)

Small claims are claims up to GBP 10,000 (GBP 15,000 if both parties agree).

The philosophy is: don't shut out ordinary people from court by making them pay huge legal bills.

What you can recover as the winner:

• Court fees you paid
• Fixed costs of GBP 25-GBP 75 (set by rules, depending on judgment value)
• Reasonable witness expenses
• Expert report fees (if court approved the expert)
• Interpreter fees
• Costs of serving documents

What you cannot recover:

• Solicitors' and barristers' fees (advocacy costs)
• Your own time or effort (even if you're experienced in law)
• General legal representation costs

If you lose: You pay only the winner's court fees and fixed recovery costs, not their legal team's charges.

Exception (rare): If the losing party behaved unreasonably, the court can order them to pay up to GBP 1,000 toward the winner's legal costs. This requires the winner to make a specific application.

Fast track costs (fixed costs schedule)

Fast track is for claims between GBP 10,001 and GBP 100,000 (usually simpler cases with a tight timetable).

The court applies fixed costs at trial. These are set out in CPR Part 45 and do not change unless a party can prove exceptional circumstances.

Typical fast track fixed costs (at trial):

• Solicitor's fees: GBP 490 to GBP 9,900 (depending on claim value and complexity)
• Counsel's fees: GBP 490 to GBP 2,000
• Disbursements: expert fees, witness expenses
• Court fees

Example: You win a GBP 50,000 fast track claim. You can recover roughly GBP 4,500-GBP 5,500 in legal costs (fixed), plus your actual expert and court fees. You cannot claim GBP 20,000 for your solicitor's work, even if that's what you paid.

Why fixed costs exist: They encourage settlement and prevent cost escalation. Both parties know the maximum they might pay, which focuses negotiations.

Interim applications (during the case): Fixed costs apply to the trial decision. Costs of interim applications (e.g., striking out, summary judgment) are assessed separately and awarded at the judge's discretion.

Multi-track costs (costs budgeting, Precedent H, proportionality)

Multi-track is for claims over GBP 100,000, or complex cases below that threshold.

There are no fixed costs on multi-track. Instead, each party must file a costs budget (Precedent H form) showing their planned spend. The court scrutinises it for proportionality.

Proportionality test: Is the cost of the case in line with the stakes? A GBP 1 million dispute justifies more spending than a GBP 150,000 claim. If your bill is wildly out of proportion, the court will not award it, and you may be ordered to pay the other side's costs of challenging it.

Costs budgeting steps:

1. Each party files a budget by the deadline (court-set)
2. At a Case Management Conference, the judge "approves" or "phases" the budget
3. Once approved, each party is generally stuck to that figure (unless costs recover significantly more or the case changes)
4. If you spend more than your budget without a good reason, the court will not award the excess

Detailed assessment: After the trial, if there's a costs dispute, the case goes to a specialist costs officer (not the trial judge) for "detailed assessment". The officer goes through every item and decides what's reasonable and necessary. This process is formal and can take weeks.

Indemnity basis vs standard basis:

• Standard basis: Only recover costs that were reasonable, necessary, and proportionate
• Indemnity basis: Recover nearly everything you spent, unless it was clearly unreasonable

Standard basis is the default. Indemnity basis is awarded only in special cases (e.g., fraud, breach of trust, or where a Part 36 offer was refused).

Standard basis vs indemnity basis assessment

When costs are assessed, the court uses one of two standards.

Standard basis (the norm): The judge or costs officer will award only costs that were:

• Reasonable in amount
• Necessary to properly conduct the case
• Proportionate to the dispute

Example: You instruct a QC to run a GBP 50,000 commercial dispute. The court might decide a QC was not necessary and reduce the fee to what a junior counsel would have charged.

Indemnity basis (rare, punitive): The judge awards costs on an indemnity basis if they believe one party has behaved particularly badly. The costs officer will award nearly all costs, unless they are completely unreasonable.

Example: The defendant knowingly withholds key evidence. The judge might order costs on the indemnity basis, meaning the defendant pays for the claimant's QC, full medical experts, and even costs of pursuing the case further.

How to trigger indemnity basis:

• Fraud or dishonesty
• Breach of trust
• Rejection of a Part 36 offer (see below)
• Gross unreasonableness in conduct

Types of costs order (no order, costs in case, costs reserved, costs in the application)

Courts do not always order the loser to pay all of the winner's costs. Instead, they tailor the order to the circumstances.

"No order for costs" Each party bears their own costs. Used when the case is split (both sides achieved something), or neither side was clearly right or wrong.

"Claimant to pay defendant's costs" (or vice versa) The stated loser pays the winner's costs. This is the standard order after a full trial.

"Costs in case" Costs reserved until trial, then decided by the trial judge. Used when the trial judge will be better placed to decide who should pay.

"Costs in the application" Whoever wins the interim application pays the costs of that application only. The main case costs are decided later.

"Costs reserved" Costs are not decided now; they are decided later (usually at trial). Used at preliminary hearings when the judge wants to see how the case develops.

"Costs follow the event" The party who loses the issue pays the costs of that issue. Used when the judgment is split (e.g., liability is split, or one claim succeeds and another fails).

Part 36 offers and how they affect costs

A "Part 36 offer" is a formal settlement proposal made under CPR Part 36. If you make a Part 36 offer and the other side rejects it and then loses, the consequences for them are severe.

What is a Part 36 offer? A written offer to settle, made "without prejudice except as to costs". This means:

• The other side cannot see it until trial
• If they reject it and then lose at trial, they pay your costs on the indemnity basis (nearly all your costs), plus interest on those costs from the date of the offer

Example: You offer to settle a GBP 100,000 claim for GBP 60,000 (a Part 36 offer). The defendant rejects it. At trial, you win GBP 85,000. Because you beat your own Part 36 offer, the defendant must pay your costs on the indemnity basis plus interest from the offer date. This can double the total amount they pay.

Who can make a Part 36 offer? Either the claimant (to settle for less) or the defendant (to offer a sum less than the claim, or to offer a non-monetary remedy).

How to make one:

• In writing
• Clearly stating it is a Part 36 offer
• Stating when it expires (minimum 21 days)
• Stating what it covers (the whole claim or part of it)
• Serving it formally on the other side

Strategic use: Part 36 offers are powerful settlement tools. Defendants often use them to limit their costs exposure; claimants use them to pressure defendants to negotiate.

Interim applications and costs

Before trial, either party can make an interim application (e.g., for security for costs, summary judgment, striking out pleadings, or disclosure orders).

Each interim application has its own costs order, separate from the trial costs.

Who pays costs of an interim application?

• The party who loses the application pays the costs of it
• The trial judge decides the costs of interim applications made before trial
• Interim costs are usually assessed summarily (the judge decides on the day)

Common interim applications and typical costs orders:

• Strike out: Winner gets costs
• Summary judgment: Winner gets costs
• Disclosure disputes: Usually "costs in case" (decided at trial)
• Extension of time: The party who needed the extension usually pays

Interim costs and trial: If one party wins several interim applications, they may have built up significant costs before trial. These are factored into the trial costs order.

Wasted costs orders (against legal representatives)

In rare cases, the court can order a solicitor or barrister to pay costs personally if they have behaved improperly.

What is a "wasted costs order"? An order that a legal representative (solicitor or barrister) pays costs that were wasted due to the representative's negligence, breach of duty, or abuse of process.

Example: Your solicitor files a claim without authority from you. The defendant applies to strike it out. The solicitor's firm is ordered to pay the wasted costs.

Who can apply?

• The other party
• The court (of its own motion)
• The party paying the solicitor (you)

Threshold: The conduct must be negligent or improper, not just poor judgment.

Costs against and in favour of litigants in person

A "litigant in person" is someone representing themselves without a lawyer.

Costs you can recover if you win:

• Court fees you paid
• Reasonable costs of expert evidence (if court-approved)
• Reasonable witness expenses
• Travel and accommodation to court
• Interpreter fees
• Costs of serving documents
• A "litigant in person allowance" (fixed rate, usually GBP 19 per hour, up to a reasonable number of hours spent on the case)

Costs you cannot recover:

• The monetary value of your own time (you only get the fixed allowance, not your actual hourly rate)
• Costs for preparing bundles, documents, or legal research beyond the fixed allowance
• Solicitor costs (you didn't pay any)

Example: You successfully defend a GBP 50,000 fast track claim as a litigant in person, spending 80 hours. You can recover:

• Fast track fixed costs: GBP 490-GBP 1,000 (depends on claim value)
• Litigant in person allowance: 80 hours x GBP 19 = GBP 1,520
• Your actual expert fees: GBP 1,000
• Total: roughly GBP 3,500-GBP 4,500

You do not recover your own time at GBP 100/hour or whatever you earn normally.

Why? Litigants in person may have high hourly rates in their day job. Allowing recovery of actual time would open the door to inflated claims. The fixed allowance is a fair compromise.

Detailed assessment vs summary assessment

Summary assessment: The court (usually the trial judge) decides costs on the day of trial or shortly after. The judge reviews evidence and makes a rough calculation. Fast track cases are always summarily assessed.

Advantages: Fast, no separate hearing needed, costs are resolved immediately.

Disadvantage: Less scrutiny of each item.

Detailed assessment: After trial, a specialist costs officer holds a hearing where each party can challenge every cost item. The defendant's solicitor attends and argues against high items.

The costs officer examines:

• Whether each service was necessary
• Whether the hourly rates were reasonable
• Whether the time spent was proportionate
• Whether the overall bill is proportionate

This can take weeks. The final bill is often lower than claimed.

Used in multi-track cases and when summary assessment would be unfair (e.g., a very large bill needs scrutiny).

Day to day (when costs orders are made)

Costs orders are made at multiple stages, not just at trial.

Interim applications: Each costs order as the application is decided.

Case management conferences: Usually "no order for costs" (each party bears their own) unless one side has behaved unreasonably.

Settlement discussions: If you settle, you can agree costs with the other side, or ask the court to make a costs order.

Trial: The main costs order is made at the end of trial. The judge says "claimant to pay defendant's costs" or vice versa.

After trial: If costs are to be assessed, the costs officer holds a hearing (detailed assessment) or the judge decides on the day (summary assessment).

Common misconceptions

"The winner always recovers all their costs." False. You recover only reasonable, necessary costs on a standard basis. You might spend GBP 50,000 and recover only GBP 15,000 if the court thinks the rest was not proportionate.

"Litigants in person don't have to pay costs." False. Litigants in person who lose must pay the winner's costs, just like anyone else. And if they win, they recover less than a lawyer would (a fixed allowance instead of solicitor fees).

"If I make a Part 36 offer, the other side must accept it." False. They can reject it. But if they lose, they pay a higher rate of costs (indemnity basis plus interest). Part 36 is a pressure tactic, not a binding settlement.

"The loser always pays all the winner's costs." False. The court might order "no order for costs" if both sides achieved something, or if the case was genuinely uncertain.

"I can claim my own time as a cost." Only if you are a litigant in person, and only via the fixed allowance (GBP 19/hour). If you are a solicitor or accountant acting for yourself, you get nothing for your own time.

Related concepts

• Costs budgeting and Case Management Conferences
• How to settle a case: settlement agreements and without prejudice
• Security for costs: what it is and when courts order it
• Appeal costs and how they are awarded
• Interim orders and applications
• Disclosure and costs sanctions
• Expert evidence and costs implications
• Litigants in person: your rights and costs

Sources

• Civil Procedure Rules Part 44: General rules about costs
• Civil Procedure Rules Part 36: Offers to settle
• Civil Procedure Rules Part 45: Fixed costs
• Courts and Tribunals Judiciary: Costs guidance
• UK Justice: Courts and Procedure

Disclaimer: This page provides general educational information about UK civil costs orders. It is not legal advice. Court costs are complex and vary by case. Always consult a qualified solicitor or barrister for advice on your specific situation.

Written by Peter Kolomiets, founder of CaseCalm. UK legal content reviewed 2026-05-28.