Costs Awarded and Costs Orders Policy

Purpose

Courts, and some tribunals, can order one party to pay part of another party's costs of a case. This policy explains the risk of being ordered to pay costs, what happens to costs awarded to you, and how NEO handles costs money. It doesn't change your retainer agreement: if the two ever differ, your signed retainer governs.

What costs are

• Costs are an amount a court or tribunal orders one party to pay another toward what the case cost them. They are separate from what the case is about, such as the money claimed, and separate from our fees.
• Costs are usually only a small part of what a party spends, and they are never certain.
• Disbursements, such as filing fees, are often dealt with separately. Our Disbursements and Third-Party Costs Policy explains them.

In Small Claims Court

• Disbursements. A successful party is entitled to have their reasonable disbursements paid by the unsuccessful party, unless the court orders otherwise. The court's rules limit some of them: for example, no more than $60 for serving each person, unless there are special circumstances, and no more than $200 for preparing a claim or a defence.
• A limit on other costs. Under the Courts of Justice Act, costs other than disbursements can't be more than 15 per cent of the amount claimed, or of the value of the property claimed. The court may award more only if it considers it necessary, in the interests of justice, to penalize a party or a party's representative for unreasonable behaviour.
• A representation fee. If a successful party is represented by a lawyer or paralegal, the court may award them a reasonable representation fee at trial or at an assessment hearing.
• People without a representative. The court may order an unsuccessful party to pay a successful party who represents themselves up to $500 for inconvenience and expense.
• Offers to settle. A written offer to settle can change who pays costs. The court's rule on this applies only if the offer is made at least seven days before trial and is still open when the trial starts. If the trial result is no better for the other party than the offer, the court may award the party who made it up to twice the usual costs, not counting disbursements. For an offer by a defendant, those costs are counted from when the offer was served.
• Penalties. If a party, or a party's representative, has unduly complicated or prolonged a case, or otherwise acted unreasonably, the court may order them to pay another party an amount as a penalty.

At tribunals

Each tribunal has its own rules. Under Ontario's Statutory Powers Procedure Act, many tribunals can order costs only if a party has acted unreasonably, frivolously, vexatiously or in bad faith, and only under rules the tribunal has made. Some tribunals have other powers under their own laws, and federal tribunals follow federal law. We tell you what applies to your matter.

Our policy

1. We explain the risk before you act. Before you start or defend a case, and before each major step, we explain whether you could be ordered to pay costs if you lose, and what you might recover if you win.
2. No promises. Costs are decided by the court or tribunal. We never promise that costs will be awarded, or how much.
3. Offers and costs. Before you make, accept or turn down an offer to settle, we explain how it could affect costs, under our Settlement Offers and Client Instructions Policy.
4. Costs awarded to you are yours. Costs awarded in your favour, including a representation fee, belong to you. They don't reduce our fees.
5. How costs are paid and applied. Under our standard retainer, money payable to you in the matter, including costs, is paid to us in trust. We tell you promptly when it arrives. As your retainer allows, we may use it to pay our accounts that we have delivered to you, and we then pay you the rest promptly, with a statement.
6. Nothing taken without your consent. We never take costs, or any other payment connected with your matter, from anyone but you without telling you fully and having your consent.
7. If you are ordered to pay costs. Costs ordered against you are yours to pay, even if we don't charge you a fee. We tell you the amount, when it is due, and what could happen if it isn't paid. Money we hold in trust for you is used to pay them only if you direct us to.
8. Orders against NEO. If a court or tribunal ever orders NEO, or one of our paralegals personally, to pay costs or a penalty, it is never charged to you.
9. Collecting costs. If the other side doesn't pay costs it was ordered to pay, enforcing the order is a separate step, outside your retainer unless we agree otherwise in writing. Our Demand Letters and Collecting Money for Clients Policy explains how we collect.
10. If a court reduces our account. If a court orders our fees or disbursements reduced, we repay you as soon as practicable.

Other fee arrangements

If your retainer's fee pages deal with costs differently, they apply. For example, under a no-charge retainer, costs awarded for our work are dealt with as we agree with you in writing at the time, and we never take them without your agreement.

Review

This policy is reviewed at least once a year, and whenever the Law Society's By-Laws or rules change. The principal approves every change.

Questions

Email info@neolegalservices.com, call 647-200-3526 or toll-free 888-519-2435, or write to us at Unit 236, 1099 Kingston Road, Pickering, Ontario L1V 1B5.