Masood Ahmed & Lal Akhter consider the high hurdle to clear before a court will grant indemnity costs on the basis of unreasonable conduct
- The recent decision of Evans v R&V Allgemeine Verischerung AG provides an important reminder of the approach the courts will take when considering whether to make an indemnity costs order.
- A court will only make an indemnity costs order where the conduct of the parties was ‘out of the norm’ and each case will be determined on its own particular facts.
- An application for indemnity costs must be supported with strong and convincing evidence which clearly demonstrates that the conduct complained of is ‘out of the norm’.
In civil litigation, costs will either be assessed on the standard basis or the indemnity basis; the default position is the standard basis. A court may, however, order costs on the indemnity basis if the circumstances of the case justify such an order being made. The effect of an indemnity costs order is to disapply the requirement that, in addition to costs being reasonably incurred,
