How to apply for a costs order in NSW civil proceedings
Costs in NSW civil proceedings are in the discretion of the court under section 98 of the Civil Procedure Act 2005 (NSW). The usual rule under UCPR 42.1 is that costs follow the event. Seek a costs order at judgment, by Notice of Motion, or by costs agreement, then follow up with assessment under the Legal Profession Uniform Law Application Act 2014 (NSW).
The framework
Civil Procedure Act 2005 (NSW) section 98; Uniform Civil Procedure Rules 2005 (NSW) Part 42; Legal Profession Uniform Law Application Act 2014 (NSW) Part 7; relevant Practice Notes.
The process
Identify the costs rule
UCPR 42.1 — costs follow the event unless the court decides otherwise. Specific rules address offers of compromise (42.13), Calderbank offers, and set-off (42.35).
Consider the basis
Costs may be ordered on the ordinary (party and party) basis or on an indemnity basis (for example, where an offer of compromise was beaten or misconduct occurred).
Make offers of compromise
An offer of compromise under UCPR 20.26 that is not accepted and not beaten triggers indemnity costs from the day after service (42.13). Calderbank offers are an alternative under common law.
Prepare costs submissions
Draft submissions addressing the event, conduct of proceedings, offers made, and why any alternative order (no order, specified issues) should not apply.
Seek costs orally at judgment
Most cost orders are sought at judgment. Be ready to address the court briefly on costs and hand up a short outline.
Alternative: Notice of Motion for costs
Where costs are reserved or need determination separately, file a Notice of Motion under UCPR Form 40 with supporting affidavit.
Specify categories
Identify costs of the whole proceedings, a specific motion, or issue-based costs. The court may order costs of a discrete issue under UCPR 42.7.
Consider lump-sum costs order
Under UCPR 42.1, the court may fix a gross sum in lieu of assessment. Prepare an affidavit quantifying costs with sufficient detail for the court to assess reasonableness.
Costs assessment
If not quantified, apply for costs assessment under Part 7 of the Legal Profession Uniform Law Application Act 2014 (NSW) within 12 months of the costs order or rendering of the bill.
Enforce the costs order
Once the amount is fixed (by agreement, lump sum, or assessment certificate filed under section 83), enforce the costs order as a judgment debt under UCPR Parts 39–40.
Common mistakes
- Leaving costs to be assessed when a lump-sum order is faster and cheaper
- Missing the 12-month assessment window under the Uniform Law Application Act 2014
- Failing to serve offers of compromise in compliant form under UCPR 20.26
- Overlooking issue-based costs under UCPR 42.7
- Not quantifying costs with sufficient evidence for a gross-sum order
Get this process right with Quillio
Quillio can draft costs submissions, prepare lump-sum costs affidavits, and calculate indemnity costs from offer-of-compromise dates under UCPR 42.13. See /practice-areas/litigation-lawyers.
General information only, not legal advice. Costs are technical and strategic. Engage a NSW litigation lawyer and, where needed, a costs lawyer.
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