If you have received a Bill of Costs alongside a Notice of Commencement, this will signify the initiation of detailed assessment proceedings. Following receipt of these documents, you will have 21 days from the date of service to dispute the costs listed within the Bill in the form of Points of Dispute (Precedent G). If you do not respond within the 21 day period, the receiving party will be able to make an application to the Court for a Default Costs Certificate, which means you (the paying party) will be required to pay all the costs listed within the Bill of costs.
Points of Dispute can be used to reduce your costs liability following receipt of a Bill of Costs. They are formal legal arguments which can be raised against the costs claimed for specific items in the Bill.
All items within the Bill of costs can be scrutinised and challenged; however, the best way to achieve significant reductions is by targeting big-ticket items, such as hourly rates, proportionality, and the charges for Counsel fees and document time claimed. Points of Dispute can also be used to make technical challenges regarding the validity of the retainer, for example, to disallow all costs claimed.
How to Prepare Points of Dispute
The rules for preparing Points of Dispute are listed under Practice Direction 47.8.
Practice Direction 47.8 states that:
“Points of dispute must be short and to the point. They must follow Precedent G in the Schedule of Costs Precedents annexed to this Practice Direction, so far as practicable. They must:
(a) identify any general points or matters of principle which require decision before the individual items in the Bill are addressed; and
(b) identify specific points, stating concisely the nature and grounds of dispute.
Once a point has been made it should not be repeated but the item numbers where the point arises should be inserted in the left hand box as shown in Precedent G.”
When preparing your Points of Dispute, you should ensure that you:
- Format your points correctly by following the precedent G structure. Allow space for a dispute and reply, as well as the decision from the Cost Officer at a hearing.
- Make points short and concise to state the issue you wish to raise, providing evidence to support your arguments. The Court may ask for the Points of Dispute to be redrafted if you fail to abide by this rule.
- Refer to each party correctly, i.e. the party paying the costs is the “paying party”, and the party who will receive the PODs and costs is the “receiving party”.
- Assess which type of hearing your matter will proceed to. Generally, a provisional assessment hearing deals with bills below £75,000, and a detailed assessment hearing deals with bills amounting to more than £75,000. A Provisional assessment is dealt with on the papers only, so you must make sure all evidence is included within your submission.
- Start off your points by addressing points of principle, such as hourly rates or proportionality. Then proceed to scrutinise specific items in the Bill. You should create a new Point for each different item for which you seek a reduction.
What Happens Next?
When you have submitted your Points of Dispute, the receiving party can then raise Points of Reply within 21 days. Parties may continue negotiations throughout the detailed assessment process until a settlement is reached.
If an agreement cannot be reached, the receiving party must make an application for a Court assessment of their legal costs by completing an N258 form. This should be made within six months of service of the Bill. Interest on costs can be reduced by making a payment on account of costs. We would strongly recommend that this is made as interest accrues at a rate of 8% from the date of the Costs Order.
Once your request for a hearing has been filed, the Court will make an Order listing the matter for a provisional/detailed assessment hearing within six weeks.
If the case proceeds to a Provisional Assessment Hearing, this will be completed on paper, and you will not be required to attend the hearing. If the case proceeds to a Detailed Assessment Hearing, this will be an oral hearing, and both parties will be required to attend.
It is possible to appeal any decision made during the course of a detailed assessment hearing in accordance with CPR 47.22.
Any appeal notice (N161) must be lodged with a costs judge or a district judge of the High Court within 21 days of the date of the detailed assessment decision (or Court of Appeal if the initial assessment takes place in the High Court). Directions will be given thereafter, and a copy of the Appeal notice served upon any other parties to proceedings.
How Can Legal Practice Support Help?
The Legal Practice Support team are always happy to help/advise on any costs issues through the process of Detailed Assessment, including the preparation of Points of Dispute and Points of Reply.
We prepare Points of Dispute within seven days of instruction on the majority of cases, and have fixed fees for all preparatory work. We provide our services and assistance to both law firms and litigants in persons.
Our team of Costs Lawyers and Costs Draftsmen can represent you at detailed assessment hearings irrespective of whether you are the paying party or the receiving party.
As a team of highly experienced and qualified Costs Draftsmen and Costs Lawyers, we strive to achieve the best possible outcome for all clients and can assist in all areas of litigation.
If you would like to find out more about our law costs draftsman service, please visit the legal costs section on our website.
Our Costs Director, Robert Collington, can be contacted via email at enquiries@legalpracticesupport.co.uk or by telephone on 01204 930234.