IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

PRACTICE DIRECTION NO. 4 OF 2014

DIFC Courts’ Wasted Costs Orders

Citation

This Practice Direction will come into effect on the date of signature. It may be cited as Practice Direction 4 of 2014 – DIFC Courts’ Wasted Costs Orders – and may be abbreviated to PD 4/2014.

Wasted Costs

Personal liability of legal representative for costs – wasted costs orders: rule 38.83

1. A wasted costs order is an order –
(a) that the legal representative pay a sum (either specified or to be assessed) in respect of costs to a party; or

 

(b) for costs relating to a specified sum or items of work to be disallowed.

 

2. Rule 38.83 deals with wasted costs orders against legal representatives. Such orders can be made at any stage in the proceedings up to and including the detailed assessment proceedings. In general, applications for wasted costs are best left until after the end of the trial.

 

3. The Court may make a wasted costs order against a legal representative on its own initiative.

 

4. A party may apply for a wasted costs order –
(a) by filing an application notice in accordance with Part 23; or

 

(b) by making an application orally in the course of any hearing.

 

5. It is appropriate for the Court to make a wasted costs order against a legal representative, only if –
(a) the legal representative has acted improperly, unreasonably or negligently;

 

(b) the legal representative’s conduct has caused a party to incur unnecessary costs, or has meant that costs incurred by a party prior to the improper, unreasonable or negligent act or omission have been wasted;

 

(c) it is just in all the circumstances to order the legal representative to compensate that party for the whole or part of those costs.

 

6. The Court will give directions about the procedure to be followed in each case in order to ensure that the issues are dealt with in a way which is fair and as simple and summary as the circumstances permit.

 

7. As a general rule the Court will consider whether to make a wasted costs order in two stages –
(a) at the first stage the Court must be satisfied –
(i) that it has before it evidence or other material which, if unanswered, would be likely to lead to a wasted costs order being made; and

 

(ii) the wasted costs proceedings are justified notwithstanding the likely costs involved;

 

(b) at the second stage, the Court will consider, after giving the legal representative an opportunity to make representations in writing or at a hearing, whether it is appropriate to make a wasted costs order in accordance with paragraph 5 above.

 

8. The Court may proceed to the second stage described in paragraph 7 without first adjourning the hearing if it is satisfied that the legal representative has already had a reasonable opportunity to make representations.

 

9. On an application for a wasted costs order under Part 23 the application notice and any evidence in support must identify –
(a) what the legal representative is alleged to have done or failed to do; and

 

(b) the costs that the legal representative may be ordered to pay or which are sought against the legal representative.

 

Dated this 23rd day of June 2014

Chief Justice Michael Hwang