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Legal Aid practitioners frequently encounter situations where work has been undertaken before prior authority has been obtained, or where authority should arguably have been sought but was not. The consequences can be significant. Concerns commonly arise regarding: recoverability of expert fees unusually large disbursements exceptional expenditure complex case progression assessment scrutiny payment delays Whilst every case turns on its own facts, failure to obtain prior authority does not automatically mean that all recovery is lost. Understanding the potential risks and available options at an early stage is often critical. What Is Prior Authority? Prior authority is a mechanism through which the Legal Aid Agency approves certain expenditure before it is incurred. The requirement commonly arises in relation to: expert evidence interpreters specialist reports substantial disbursements unusual case requirements he purpose is to ensure that expenditure is reasonable, proportionate and justified before public funding is committed. Why Does Failure to Obtain Prior Authority Cause Problems? Where prior authority should have been obtained but was not, assessment difficulties frequently arise. Common concerns include: reductions during assessment requests for further justification delays in payment disputes regarding necessity challenges to reasonableness uncertainty regarding recoverability In practice, assessment often becomes significantly more difficult where expenditure was incurred without prior approval. Does Failure to Obtain Prior Authority Mean Recovery Is Impossible? Not necessarily. The absence of prior authority does not automatically prevent recovery in every case. However, firms may need to demonstrate: why the work was necessary why expenditure was reasonable why authority was not obtained earlier why the costs should remain recoverable The strength of available evidence frequently becomes important. Contemporaneous records, attendance notes and supporting documentation may all assist. Common Situations We Encounter We are regularly instructed where firms face issues such as: Urgent Expert Evidence Cases where expert evidence was required urgently and authority could not realistically be obtained beforehand. Developing Litigation Matters where case complexity increased significantly beyond original expectations. Certificate Amendments Cases involving changes in scope, funding or case progression. Counsel and Specialist Input Situations where additional expertise became necessary during the life of the matter. Court of Protection Matters Complex funding arrangements and evolving evidential requirements. How Prior Authority Issues Affect Assessment Prior authority disputes often arise much later than the work itself. Problems frequently emerge during: CCMS claim preparation Legal Aid billing detailed assessment reassessment proceedings appeal processes By this stage, reconstructing justification can become difficult. Early specialist review frequently assists in identifying and addressing potential weaknesses before submission. Practical Steps If Prior Authority Was Not Obtained Where concerns arise regarding prior authority, firms should consider: reviewing the funding history carefully identifying all relevant expenditure gathering supporting evidence reviewing attendance notes considering whether explanations can be provided contemporaneously assessing likely recoverability risks Early action often provides greater flexibility than attempting to address issues after a claim has been challenged. Managing Recovery Risk Many Legal Aid costs problems are not caused by the work undertaken. They arise because the work cannot easily be justified or evidenced at assessment. Specialist costs input can assist with: presenting claims effectively addressing likely challenges responding to LAA queries preparing reassessment requests maximising lawful recovery The earlier issues are identified, the easier they are generally to manage. How SPH Costs Assists SPH Costs provides specialist support with: Legal Aid costs drafting CCMS claims assessment queries reassessment proceedings High Costs Case Plans recovery strategy complex Legal Aid costs issues We act for Legal Aid firms across England & Wales and regularly assist with difficult recoverability and assessment issues. Speak to a Legal Aid Costs Specialist If your firm is concerned about: prior authority issues delayed payment CCMS difficulties reassessment proceedings Legal Aid recoverability SPH Costs provides specialist Legal Aid costs support across England & Wales. Common Costs Problems ​ Legal Aid costs recovery frequently involves issues such as CCMS claim rejections, prior authority concerns, payment delays, assessment reductions and LAA queries. For further practical guidance, visit our Common Costs Problems resource centre.

One of the most common, and costly, problems in Legal Aid costs recovery arises when firms fail to obtain prior authority from the Legal Aid Agency (LAA) before substantial work is undertaken. This issue frequently arises shortly before final hearings, particularly where cases have expanded beyond their original scope or where additional preparation, counsel’s fees or expert involvement becomes necessary. If prior authority is not obtained in time, firms may discover that significant parts of their costs are simply not recoverable. For many practices, this can result in substantial financial losses which could have been avoided through earlier funding review and proactive costs management. What Is Prior Authority? Prior authority is approval obtained from the Legal Aid Agency before certain categories of work or expenditure are incurred. The purpose is to ensure that: The work is necessary The proposed costs are reasonable Public funding remains proportionate In many cases, firms assume that because a certificate exists, all necessary work will automatically be recoverable. Unfortunately, that is not always correct. Common Situations Where Problems Arise Final Hearings Expanding Beyond Original Estimates A common issue occurs where proceedings become more complex than originally anticipated. For example: Additional witness evidence Extensive bundles Late disclosure Additional conferences with counsel Where costs escalate significantly beyond the original scope of funding, firms may require further authority before undertaking the work. Counsel’s Fees Counsel’s fees are frequently scrutinised by the LAA. If authority is not obtained where required, firms may later face reductions or outright refusal during assessment. This is particularly risky in: Care proceedings Court of Protection matters Complex family litigation Expert Evidence Experts regularly require prior authority, particularly where fees exceed standard rates or where multiple experts are involved. Problems commonly arise where: Urgent instructions are given without approval Supplementary reports are obtained Updated evidence is commissioned shortly before trial Without authority, recovery may become difficult or impossible. Why Firms Miss Prior Authority Issues In practice, the problem is often procedural rather than legal. Common reasons include: Heavy caseloads Funding reviews not being diarised Fee earners assuming existing cover is sufficient Late developments shortly before hearings Lack of internal Legal Aid supervision systems The difficulty is that the issue may only become apparent months later when costs are assessed or rejected within CCMS. The Financial Consequences Failure to obtain prior authority can have serious consequences for profitability. Potential outcomes include: Reductions to counsel’s fees Refusal of expert fees Delays in payment Additional appeals or reassessment work Significant write-offs against profit costs For high-volume Legal Aid practices, repeated failures can materially affect cash flow and overall financial performance. Practical Steps Firms Can Take Review Funding Before Final Hearings A funding review should be undertaken well before any substantial hearing. This should include: Counsel’s fees Estimated preparation time Expert evidence Additional witnesses Updated case complexity Use Internal Funding Checklists Many firms benefit from standardised Legal Aid funding review procedures to ensure authority issues are identified early. Monitor CCMS Carefully CCMS issues frequently arise where amendments or approvals remain outstanding. Regular monitoring reduces the risk of assumptions being made about coverage. Seek Specialist Costs Advice Early Specialist Legal Aid Costs Draftsmen can often identify funding problems before they become irrecoverable losses. Early intervention is usually far cheaper than attempting to challenge reductions after assessment. How Specialist Costs Lawyers Can Help Specialist Legal Aid Costs teams can assist with: CCMS claims High Cost Case plans Prior authority applications Legal Help billing Escape fee claims Appeals and reassessments Recovering unpaid Legal Aid costs Strategic costs advice can significantly reduce the risk of avoidable losses. Conclusion Failing to obtain prior authority from the Legal Aid Agency can leave firms exposed to substantial unrecoverable costs, particularly in cases approaching final hearing. As Legal Aid work becomes increasingly administratively complex, proactive funding management is essential. Regular funding reviews, effective supervision and specialist costs support can help firms avoid unnecessary losses and improve Legal Aid cost recovery. Details of our Civil Legal Aid Costs Drafting Services can be found here. Common Costs Problems ​ Legal Aid costs recovery frequently involves issues such as CCMS claim rejections, prior authority concerns, payment delays, assessment reductions and LAA queries. For further practical guidance, visit our Common Costs Problems resource centre.

Paying Party Strategy and Proportionality Control Counsel’s fees are often one of the largest components of a bill of costs. For paying parties, they represent a key opportunity to reduce exposure at detailed assessment. Challenges rarely succeed through simple objection; they succeed when tied to proportionality, necessity, and the overall value of the litigation. This article explains how paying parties can challenge counsel’s fees effectively and how those arguments interact with wider issues of proportionality, delegation, and recoverability and conduct. Why Counsel’s Fees Attract Judicial Scrutiny Courts assess counsel’s fees on the same core principles that apply to all inter partes costs: reasonableness necessity proportionality Even where work has been carried out, the court will ask whether the level of counsel instructed was justified by the value, complexity, and importance of the case. This is particularly relevant on the standard basis, where any doubt is resolved in favour of the paying party. Common Grounds of Challenge Level of Counsel Instructed A frequent issue is whether leading counsel was necessary. In modest value or routine claims, the court may find that junior counsel would have been sufficient. This mirrors the wider issue of fee earner delegation, where work carried out at an unnecessarily senior level is vulnerable to reduction. Duplication Between Solicitors and Counsel Paying parties should analyse: overlapping attendances duplicated conferences solicitor time spent re-working counsel’s material Where duplication exists, reductions can be made to one or both elements. This aligns with broader detailed assessment paying party services strategy, where duplication is a central theme in reducing bills. Conferences and Refreshers Courts will consider: the number of conferences their duration whether multiple fee earners attended Excessive attendance by both solicitors and counsel is frequently reduced unless clearly justified by complexity. Proportionality of Counsel’s Fees Even where counsel’s fees are reasonable in isolation, they may still be disproportionate when viewed against: the sums in issue the stage reached the outcome achieved This reflects the modern “stand-back” approach to proportionality, where global reductions may be applied after line-by-line assessment. The Importance of Case Value High counsel’s fees in low or moderate value claims are particularly vulnerable. Courts expect the level of representation to reflect the financial and factual weight of the case. This has been reinforced in recent costs decisions where the choice of expensive representation was treated as a litigation choice, not a recoverable necessity. Interaction with Conduct and Strategy Counsel’s fees may also be affected by conduct issues. For example: unnecessary applications over-pleading tactical steps that increased costs without advancing the case These points link directly to recoverability and conduct, where unreasonable litigation behaviour can reduce otherwise recoverable costs. Evidence-Based Challenges Successful paying party challenges rely on: comparing the case to typical litigation of similar value identifying routine work carried out at senior level analysing whether the hearing required specialist advocacy demonstrating duplication or inefficiency This moves the argument from assertion to structured proportionality analysis. Tactical Timing Counsel’s fees should be addressed: in Points of Dispute in negotiations at detailed assessment Early identification strengthens settlement leverage and narrows the issues before the hearing. This is a core part of paying party costs lawyers strategy, where exposure modelling informs negotiation. Key Takeaways for Paying Parties Counsel’s fees are a primary driver of overall costs exposure Leading counsel is not automatically recoverable Duplication between solicitors and counsel is highly vulnerable Proportionality can reduce reasonable fees Conduct arguments can further limit recovery Early, evidence-based challenges improve settlement outcomes Strategic Conclusion Challenging counsel’s fees is not about disputing advocacy itself; it is about ensuring that the level of representation matches the needs of the case. When combined with proportionality, fee earner delegation, and recoverability and conduct arguments, it becomes one of the most effective tools available to paying parties at detailed assessment. Related Services You may also find the following resources helpful: ​ Local Authority - Challenge Claimants Costs Challenge a Bill of Costs Points of Dispute Deadline Approaching Detailed Assessment Guide Draft Points of Dispute ​Solicitors Act Assessment Common Costs Problems Contact SPH Costs

The Legal Aid Agency has published its latest processing times, updated on 4 August 2026. For firms concerned with Legal Aid billing and cashflow, the latest figures are encouraging. Civil bills are currently being processed relatively quickly, while FAS and POA claims are being processed within four working days and, in most cases, within two to three working days. High Cost Family Case Plans are also currently being processed against July dates. However, the LAA has issued an important reminder for firms using CCMS: case Outcomes must be reported and finalised promptly. The published CCMS processing times only relate to claims where this has already been done. For Legal Aid firms, getting a file billed correctly and completing the necessary CCMS steps remains critical to achieving prompt payment. Latest CCMS Civil Bill Processing Times As at the LAA update of 4 August 2026, the current Civil Bill processing dates are: Court Assessed – 24 July 2026 Fixed Fee – 28 July 2026 Hourly Rate – 24 July 2026 FAS and POA claims – within 4 working days and, in most cases, within 2–3 working days The LAA advises firms to allow a further 5–9 days for payment to be received. The current target for Civil Bills is for 95% of complete and accurate bills to be processed within 20 working days. The latest figures therefore indicate that routine Legal Aid billing is currently being processed comfortably within that target. What This Means for Legal Aid Firms For firms undertaking significant volumes of publicly funded work, faster processing should be good news for cashflow. However, the important words in the LAA's target are "complete and accurate bills". Where a claim is correctly prepared and all necessary CCMS steps have been completed, the current processing position suggests that firms should be able to move from billing to payment relatively quickly. Problems arise where claims are: • incomplete; • incorrectly coded; • unsupported; • inconsistent with the funding position; • queried by the LAA; or • not properly finalised within CCMS. A relatively fast LAA processing cycle does little to improve cashflow if the claim itself is returned, rejected or delayed by an avoidable issue. CCMS Outcomes – An Important Payment Issue The LAA has specifically reminded providers to submit their CCMS Outcome promptly to avoid payment delays. This is important. The published processing times for CCMS claims reflect claims where the Outcome has already been reported and finalised. A firm may therefore believe that a claim is experiencing an LAA processing delay when the problem actually arises from the CCMS process not having been completed. For firms managing substantial Legal Aid caseloads, ensuring that Outcomes are dealt with promptly should form part of the billing process rather than being treated as a separate administrative task. How Long Should Legal Aid Payment Take? The latest figures provide a useful indication of the current payment cycle. FAS and POA claims are being processed within four working days and, in most cases, within two to three working days. For other Civil Bills, the current processing dates are only around one to two weeks behind the LAA's 4 August update. Once processed, the LAA advises allowing a further 5–9 days for payment to be received. This represents a relatively positive position for Legal Aid firms compared with periods when significant processing backlogs have affected recovery. However, the timescales should not be treated as a guaranteed payment date. Claim-specific issues, queries or incomplete information can still delay individual claims. High Cost Family Case Plan Processing Times The latest LAA figures also provide an update for firms dealing with High Cost Family work. As at 4 August 2026: Single Case Plans – processing from 23 July 2026 Two Case Plans – processing from 15 July 2026 Correspondence – processing from 27 July 2026 The LAA's current target is to process 95% of Very High Cost Case Plans and correspondence within 20 working days for relevant family cases exceeding £25,000 using single counsel. The LAA notes that Child Abduction, Female Genital Mutilation and Forced Marriage Protection Order case plans fall within the two Counsel workstream. Why HCCP Processing Matters to Costs Recovery A High Cost Case Plan is not simply an administrative requirement. The way the case is planned, costed and amended can have a significant effect upon eventual Legal Aid recovery. Problems can arise where: • assumptions do not reflect the anticipated work; • case developments are not incorporated into amendments; • expert or Counsel costs are not properly addressed; • work progresses beyond the basis upon which the plan was approved; or • amendments are dealt with too late. The current processing figures are therefore useful, but the speed at which a Case Plan is processed is only part of the picture. The quality and accuracy of the plan itself remain critical. What Has Changed Since Our April Update? When we last reviewed the figures in April 2026, Court Assessed, Hourly Rate and Fixed Fee claims were being processed around mid-April. The August figures indicate that the LAA continues to process Civil Bills relatively close to current submission dates. For firms with completed Legal Aid files waiting to be billed, this is significant. A lengthy LAA billing backlog is currently less likely to be the principal obstacle to payment. Instead, the emphasis increasingly falls upon getting files billed promptly and accurately once the substantive work has concluded. Don't Let Completed Legal Aid Files Sit Unbilled This is probably the most important commercial point arising from the latest figures. If the LAA is processing complete and accurate Civil Bills relatively quickly, leaving completed files waiting to be billed unnecessarily delays your own cashflow. For firms with substantial Legal Aid caseloads, a backlog of completed but unbilled files can represent a significant amount of outstanding work in progress. Outsourcing Legal Aid costs drafting can help firms convert completed files into submitted claims without requiring fee earners to spend significant time dealing with CCMS and billing administration. Common CCMS Problems That Can Still Delay Payment Even when general LAA processing times are good, individual claims can still encounter problems. Common issues include: • rejected or returned CCMS claims; • incorrect claim information; • coding problems; • inadequate supporting evidence; • unclear billing narratives; • Escape Fee issues; • Prior Authority problems; • LAA clarification requests; • assessment reductions; and • failure to report and finalise the CCMS Outcome promptly. Identifying these issues before submission can avoid turning what should be a relatively quick payment cycle into prolonged correspondence with the LAA. Where Specialist Legal Aid Costs Support Helps SPH Costs provides specialist Legal Aid costs support to solicitors and law firms throughout England & Wales. Our Legal Aid Costs Draftsmen and Costs Lawyers assist firms with: • CCMS billing; • Legal Aid Bills of Costs; • High Cost Case Plans and amendments; • Escape Fee claims; • CostsMaster electronic Bills; • rejected and returned claims; • LAA queries; • reassessments; and • wider Legal Aid costs recovery. For firms with ongoing Legal Aid caseloads, we can also provide outsourced costs support, helping move completed files through billing and towards payment without diverting fee earners from substantive client work. Latest Legal Aid Billing Position – August 2026 The latest LAA figures are broadly positive for firms concerned with Legal Aid costs recovery. Civil Bills are currently being processed relatively quickly: Court Assessed – 24 July 2026 Fixed Fee – 28 July 2026 Hourly Rate – 24 July 2026 FAS and POA – generally 2–4 working days Payment – allow a further 5–9 days after processing High Cost Family work is currently being processed from: Single Case Plans – 23 July 2026 Two Case Plans – 15 July 2026 Correspondence – 27 July 2026 For Legal Aid firms, the message is straightforward. The current LAA processing position provides an opportunity to turn completed work into cash relatively quickly, provided claims are billed promptly, accurately and all necessary CCMS steps are completed. Need Help With CCMS Billing? If your firm has completed Legal Aid files waiting to be billed, SPH Costs can assist with CCMS claims, Legal Aid Bills, High Cost Case Plans and wider Legal Aid costs recovery. Our specialist Legal Aid Costs Draftsmen and Costs Lawyers support firms throughout England & Wales, whether you require assistance with a single complex claim or ongoing outsourced Legal Aid billing. Related Legal Aid Resources Legal Aid Costs Draftsman High Cost Case Plans (HCCPs) CCMS Claim Rejected – What Happens Next? Escape Fee Claim Rejected – What Happens Next? Prior Authority Not Obtained – Can Fees Still Be Recovered? Common Costs Problems

Updated 11 March 2026 A Solicitors Act assessment allows a client to challenge the amount of a solicitor’s bill by asking the court to review the charges. The procedure arises under section 70 of the Solicitors Act 1974 and is commonly used where a client disputes whether the fees charged are reasonable One of the key rules governing these assessments is the “one-fifth rule”, which determines who pays the costs of the assessment. Broadly speaking, if the client succeeds in reducing the solicitor’s bill by 20% or more, the solicitor may be required to pay the costs of the assessment. If the reduction is less than 20%, the client will usually have to pay those costs. Understanding how this rule operates is important for both solicitors and clients considering a Solicitors Act challenge. What Is a Solicitors Act Assessment? A Solicitors Act assessment is a court process used to review the amount payable under a solicitor’s bill of costs. It is separate from the detailed assessment process under CPR Part 47, which normally concerns costs between litigating parties rather than disputes between a solicitor and their own client. Where a client disputes a solicitor’s bill, the court may examine whether the charges were properly incurred and whether the amount claimed is reasonable. The process therefore provides a mechanism for resolving disputes about professional fees and ensuring that the costs charged are justified. The One-Fifth Rule Under the Solicitors Act Section 70(9) of the Solicitors Act contains the rule commonly referred to as the “one-fifth rule”. In simple terms: If the bill is reduced by 20% or more, the solicitor will normally pay the costs of the assessment. If the reduction is less than 20%, the client will usually have to pay the costs of the assessment. This rule creates an important tactical consideration for clients considering whether to challenge a solicitor’s bill. If the reduction achieved is relatively modest, the client may ultimately be responsible for the costs of the assessment proceedings themselves. However, the rule is not absolute. Courts retain discretion to depart from it where special circumstances exist. Special Circumstances and the Court’s Discretion Section 70(10) of the Solicitors Act allows the court to depart from the one-fifth rule where there are special circumstances relating to the bill or the conduct of the assessment. These circumstances may include factors such as: the way in which the assessment was conducted whether unnecessary issues were raised whether the dispute significantly increased the costs of the hearing the overall conduct of the parties Where such factors arise, the court may adjust the normal costs consequences of the assessment. The Court of Appeal Decision in Wilsons v Bentine The application of the one-fifth rule was considered in detail by the Court of Appeal in Wilsons Solicitors LLP v Bentine and Stone Rowe Brewer v Just Costs Ltd [2015] EWCA Civ 1168. In the Bentine case, solicitors had delivered a bill of approximately £145,000. Following assessment, the court allowed about £95,000, representing a reduction of more than 20%. Ordinarily this would mean the solicitor should pay the costs of the assessment under the one-fifth rule. However, the costs judge found that special circumstances existed due to the way the client had conducted the proceedings, which had significantly increased the costs of the assessment. As a result, the solicitor was ordered to pay 60% of the client’s costs, demonstrating how the court’s discretion can alter the normal outcome. The Court of Appeal ultimately confirmed that the Solicitors Act operates as a self-contained statutory scheme, and that the natural meaning of the statute should be applied when determining the operation of the one-fifth rule. The Stone Rowe Brewer Case The related case of Stone Rowe Brewer v Just Costs Ltd involved bills totalling approximately £33,000, of which about £20,000 was disputed. The parties eventually settled the dispute for £23,700, representing a reduction of roughly 30%. Despite the reduction exceeding the one-fifth threshold, the costs judge considered that the solicitors had succeeded on the principal issue raised in the dispute and ordered the client to pay 70% of the solicitors’ costs of the assessment. On appeal, the High Court concluded that insufficient weight had been given to the reduction achieved and overturned that decision. The case demonstrates that the court will examine the overall circumstances of the dispute, rather than applying the one-fifth rule mechanically. Practical Implications of the One-Fifth Rule The key lesson from these decisions is that the 20% threshold is not the only factor determining the costs consequences of a Solicitors Act assessment. Courts will also consider: the issues raised in the assessment the conduct of the parties whether the dispute unnecessarily increased the length or complexity of the hearing Where complex or unusual issues are raised, the court may depart from the normal rule and adjust the costs order accordingly. Managing Costs Disputes Effectively Solicitors Act assessments remain relatively uncommon, but when they do arise they can be procedurally complex and expensive. Clear communication with clients about fees and regular updates regarding costs can significantly reduce the risk of disputes escalating to this stage. Where costs disputes do arise, specialist advice can help parties understand the potential consequences of the one-fifth rule and the court’s discretion regarding costs. For a broader explanation of how courts assess legal costs generally, see our Detailed Assessment of Costs Guide.

Electronic Bills of Costs are now a standard feature of detailed assessment proceedings in multi-track litigation. Designed to improve transparency and efficiency, electronic bills allow parties and the court to analyse time costs, phases, budgets and fee earner activity in far greater detail than traditional paper bills. However, the increased level of scrutiny also creates new opportunities for disputes. Even relatively minor inconsistencies within an Electronic Bill of Costs can lead to extensive Points of Dispute, delays in settlement negotiations and significant reductions during detailed assessment proceedings. Understanding the most common problems can help both receiving and paying parties prepare stronger costs positions. What Is an Electronic Bill of Costs? An Electronic Bill of Costs is a spreadsheet-based Bill prepared using the Precedent S format introduced following costs budgeting reforms. Unlike traditional narrative bills, electronic bills allow parties to review: Individual time entries Fee earner grades Phases of litigation Budget comparisons J-Codes Disbursements Estimated versus incurred costs The format is intended to streamline detailed assessment proceedings and improve costs management transparency. Common Problems with Electronic Bills of Costs Inconsistent J-Coding One of the most frequent issues concerns incorrect or inconsistent J-Codes. Where work is allocated to inappropriate phases or tasks, paying parties often argue that: The work has been mischaracterised Costs have been duplicated Budget comparisons are unreliable The bill lacks transparency Judges may criticise bills that contain extensive coding inconsistencies, particularly where they affect proportionality or budgeting analysis. Budget Discrepancies Electronic bills are heavily scrutinised against approved costs budgets. Disputes commonly arise where: Claimed costs substantially exceed budgeted figures Phases appear disproportionate Work is allocated outside approved phases Estimated costs are claimed as incurred costs Budget comparison schedules are often central to detailed assessment negotiations. Excessive Time Recording Electronic bills allow paying parties to identify excessive time with far greater precision. Common challenges include: Multiple fee earners attending the same meetings Excessive drafting time Administrative work charged at solicitor rates Repeated internal conferences Duplicated attendance notes Because the data is easily searchable, patterns of inefficiency are often more visible than in traditional bills. Narrative Deficiencies Although electronic bills are data-driven, narrative descriptions remain important. Vague entries such as: “Review documents” “Telephone attendance” “Preparation” “Correspondence” may attract challenges where insufficient detail is provided to justify the work undertaken. Paying parties frequently argue that inadequate narratives prevent meaningful assessment. Paying Party Challenges Paying parties increasingly use Electronic Bills of Costs strategically. Detailed spreadsheet analysis allows parties to identify: Coding errors Duplicated work Unusual charging patterns Budget inconsistencies Fee earner allocation issues These points are commonly incorporated into detailed Points of Dispute and may substantially reduce recoverable costs. Receiving Party Considerations Receiving parties should ensure that Electronic Bills of Costs are: Properly coded Consistent with approved budgets Supported by clear narratives Carefully reviewed before service Prepared strategically with detailed assessment in mind Poorly prepared bills can weaken negotiating positions and increase assessment costs unnecessarily. The Importance of Specialist Costs Advice Electronic bills require both technical and strategic expertise. Specialist Costs Lawyers and Costs Draftsmen can assist with: Preparing compliant Electronic Bills of Costs Reviewing Precedent S formatting Analysing J-Code accuracy Preparing Points of Dispute and Replies Negotiating detailed assessment disputes Advising on costs budgeting compliance As detailed assessment proceedings become increasingly data-focused, technical accuracy is more important than ever. Conclusion Electronic Bills of Costs have transformed detailed assessment proceedings by increasing transparency and improving costs analysis. However, the additional scrutiny also creates substantial opportunities for dispute where bills contain inconsistencies, coding errors or disproportionate costs. Whether acting for receiving or paying parties, careful preparation and specialist costs advice can significantly improve outcomes during detailed assessment proceedings. Internal Links Costs Draftsman Services: https://www.sphcosts.com/services Detailed Assessment Services: https://www.sphcosts.com/detailed-assessment Points of Dispute Services: https://www.sphcosts.com/points-of-dispute Related Costs Recovery Problems Paying parties frequently encounter challenges involving Bills of Costs, Points of Dispute, detailed assessment proceedings and costs exposure. For additional practical guidance on common costs issues, visit our Common Costs Problems resource centre: https://www.sphcosts.com/common-costs-problems

Proportionality is now one of the most effective tools available in paying party costs disputes on detailed assessment. Under CPR 44.3, costs which are disproportionate may be reduced even if they were reasonably or necessarily incurred, with any doubt resolved in favour of the paying party. In practice, this enables global reductions to bills that would otherwise survive line-by-line scrutiny. When used alongside hourly rate challenges, delegation arguments and targeted Points of Dispute, proportionality can materially reduce exposure and shift settlement dynamics. The CPR 44.3 Proportionality Test On the standard basis, the court will only allow costs which are proportionate to the matters in issue and may reduce costs that are disproportionate even if they were reasonably incurred. Any doubt is resolved in favour of the paying party. This creates a distinct second stage of assessment beyond reasonableness. The “Stand Back” Approach on Detailed Assessment The court will first assess individual items for reasonableness and then stand back to consider whether the total figure is proportionate. If the overall sum is disproportionate, a broad-brush reduction may be applied. This global approach is where the most significant paying party reductions are achieved. The Five CPR 44.3(5) Factors in Practice Costs are proportionate if they bear a reasonable relationship to: The sums in issue The value of non-monetary relief The complexity of the litigation Conduct generating additional work Wider factors such as reputation or public importance Low-value claims with high incurred costs remain particularly vulnerable. Proportionality vs Reasonableness Reasonableness is assessed item by item. Proportionality is assessed globally. Costs can therefore be reasonable but still irrecoverable as disproportionate. This distinction underpins effective proportionality challenges in costs. Budgeted Cases and Proportionality Arguments An approved budget does not prevent proportionality reductions at detailed assessment. The court may still consider whether the total costs claimed bear a reasonable relationship to the matters in issue. Budget compliance is relevant but not determinative. Paying Party Strategy for Global Reductions Effective proportionality arguments should be linked to: Excessive Grade A/B time on routine tasks Failure to delegate Disproportionate work relative to claim value Over-litigation of straightforward issues Block-billed phases These points should be pleaded clearly in points of dispute and replies rather than left to general submission. Proportionality should also be combined with guideline hourly rate challenges to reinforce the global reduction argument. Delegation failures should be identified by reference to the delegation of work in costs budgeting to demonstrate inappropriate fee earner allocation. Common Receiving Party Pitfalls Receiving parties frequently: Rely on reasonableness without addressing proportionality Fail to justify Grade A/B involvement Ignore the relationship between costs and value Treat budgets as a shield These approaches are vulnerable to global reductions on detailed assessment. Drafting Effective Points of Dispute on Proportionality Proportionality arguments should: Identify the total figure said to be proportionate Refer to the CPR 44.3(5) factors Link hourly rate, delegation and phase totals Invite a stand-back reduction A generic statement that costs are disproportionate is ineffective. Properly structured points of dispute and replies are critical to advancing the argument. How We Assist Paying Parties with Proportionality Challenges Our approach to paying party costs focuses on: Phase-based proportionality analysis Delegation and grade challenges Hourly rate reductions Global stand-back submissions This supports targeted negotiation strategy and effective advocacy at provisional and detailed assessment. Detailed Assessment Strategy Guides Detailed Assessment of Costs: The Complete Guide Paying Party Detailed Assessment Strategy How Paying Parties Challenge a Bill of Costs Fee Earner Delegation Challenges at Detailed Assessment Guideline Hourly Rates 2026 Intermediate Track Costs Tables Specialist support for paying parties in contested costs Early strategic proportionality arguments can materially reduce exposure.

The level of fee earner undertaking work is a central issue in paying party costs disputes. Even where time has been reasonably incurred, the court will consider whether the work was carried out at the appropriate grade and whether proper delegation was applied. Challenges based on delegation frequently lead to substantial reductions at detailed assessment. We act for paying parties challenging excessive bills, including delegation and grade disputes at detailed assessment. Why Delegation Matters The court expects litigation to be conducted efficiently and at proportionate cost. Routine tasks carried out by senior fee earners, multiple lawyers attending the same event, or inadequate supervision structures can all justify reductions. Delegation is therefore closely linked to: proportionality Guideline Hourly Rates duplication of work necessity of attendance These issues commonly form part of Points of Dispute. The Judicial Approach to Grade and Role The court assesses not only whether work was done, but who should reasonably have carried it out. Tasks such as routine correspondence, document review, and procedural steps are rarely justified at partner or senior associate level unless supported by clear evidence. Where the grade claimed does not match the complexity of the task, reductions are likely even if the hourly rate itself falls within Guideline Hourly Rates. Duplication of Fee Earners Multiple fee earners attending conferences, hearings, or internal meetings is a common source of challenge. Paying parties will examine: whether each attendee had a defined role whether the attendance advanced the case whether a single fee earner would have been sufficient Unjustified duplication frequently results in disallowance of time or downgrading to a lower grade. Delegation and Proportionality Poor delegation is a key driver of disproportionate costs. Where the level of work and the grades deployed are out of alignment with the value and complexity of the claim, the court may apply both line-by-line reductions and global proportionality adjustments. This creates a direct link between delegation challenges and proportionality arguments. Authorisation and Recoverability of Fee Earner Time The status of the fee earner carrying out the work is also relevant to recoverability. In Mazur v Charles Russell Speechlys LLP [2025], the High Court confirmed that the conduct of litigation is a reserved legal activity which may only be carried out by a person who is individually authorised or exempt. Supervision by a solicitor is not sufficient where the individual is, in substance, conducting the litigation. For costs purposes, this creates a potential challenge where: work said to involve the conduct of litigation is carried out by an unauthorised fee earner statements of case or formal steps are signed by someone without practising rights responsibility for litigation decisions rests with a person not entitled to conduct litigation In such cases, paying parties may argue that the work is not recoverable as solicitor’s costs or should be allowed only at a reduced level, subject to recoverability principles. The issue is one of substance rather than job title. The court will consider who exercised professional judgment and who had responsibility for the conduct of the litigation. Evidence Required to Justify Senior Involvement Receiving parties seeking to justify higher-grade work must demonstrate: complexity requiring specialist input strategic decisions made by senior fee earners supervision structures that added value tasks that could not reasonably be delegated Absent such evidence, the court is likely to allow time only at the appropriate lower grade. Commercial Impact for Paying Parties Delegation challenges are particularly effective in high-volume litigation where partner-heavy billing structures are common. Early identification of grade mismatches improves negotiation leverage and reduces exposure before a detailed assessment hearing. This is especially relevant for local authorities, insurers, and defendant teams managing multiple costs claims. Key Takeaways The court assesses who did the work, not just whether it was done Routine tasks at senior grade are vulnerable to reduction Duplication of attendance is frequently disallowed Mazur creates recoverability challenges where unauthorised persons conduct litigation Delegation arguments support proportionality reductions Detailed Assessment Strategy Guides Detailed Assessment of Costs: The Complete Guide Paying Party Detailed Assessment Strategy How Paying Parties Challenge a Bill of Costs Proportionality Challenges at Detailed Assessment Guideline Hourly Rates 2026 Intermediate Track Costs Tables

Case Authority Court: Court of Appeal (England & Wales) Case: Attersley v UK Insurance Ltd [2026] EWCA Civ 217 The Court of Appeal considered the costs consequences where a Claimant accepts a defendant’s Part 36 offer after the expiry of the relevant period in a claim that initially fell within a fixed recoverable costs regime. The court confirmed that, in certain circumstances, a claimant who accepts a Part 36 offer late may remain limited to the fixed costs that applied when the offer was made or when the relevant period expired, even where the claim later progresses outside that regime. The decision provides important guidance for litigators dealing with the interaction between Part 36 settlement strategy and fixed recoverable costs. Introduction Part 36 offers remain one of the most powerful strategic tools available in civil litigation. The Court of Appeal’s decision in Attersley v UK Insurance Ltd highlights the potential consequences where a claimant accepts a defendant’s offer after the expiry of the relevant period, particularly where the claim initially fell within a fixed recoverable costs regime. For defendants, insurers and other paying parties, the judgment demonstrates how early Part 36 offers can significantly restrict recoverable costs if acceptance is delayed. Solicitors and insurers frequently instruct paying party costs lawyers to analyse the costs consequences of late Part 36 acceptance and to challenge bills of costs during detailed assessment. See our guide to paying party detailed assessment strategy: https://www.sphcosts.com/excessive-costs The Role of Part 36 in Costs Strategy Part 36 of the Civil Procedure Rules provides a structured framework designed to encourage settlement. Offers made under the rule carry significant costs consequences depending on when they are accepted. Where a claimant accepts a defendant’s Part 36 offer within the relevant period, the defendant typically becomes liable for the claimant’s costs up to the date of acceptance. However, if the claimant accepts the offer after that period has expired, the court has discretion to determine the appropriate order for costs after that date. In many cases this discretion becomes particularly significant where fixed recoverable costs regimes apply. Paying parties frequently rely on specialist advice when challenging a bill of costs at detailed assessment. See: https://www.sphcosts.com/post/how-paying-parties-challenge-a-bill-of-costs-at-detailed-assessment Interaction Between Part 36 and Fixed Costs Fixed recoverable costs regimes are intended to provide certainty and predictability in certain categories of litigation. Where a claim falls within a fixed costs framework, recoverable costs are capped at prescribed amounts depending on the procedural stage reached. The Court of Appeal in Attersley highlighted an important point: the costs consequences of late acceptance of a Part 36 offer may be determined by the fixed costs position that existed when the offer was made or when the relevant period expired. Later developments in the litigation, such as allocation to a different track or increased complexity, do not necessarily displace the earlier fixed costs framework. For a practical overview of how the intermediate track fixed recoverable costs regime operates, see:https://www.sphcosts.com/post/intermediate-track-fixed-recoverable-costs Why Late Acceptance Can Restrict Recoverable Costs The reasoning behind this approach is rooted in the structure of Part 36 and the objective of promoting early settlement. A defendant who makes an early settlement offer should be able to assess the potential costs consequences of that offer with a degree of certainty. Allowing later procedural developments to alter those consequences could undermine the predictability of the rule. Where a claimant delays acceptance of a reasonable offer, the court may determine that the costs consequences should reflect the procedural and costs position that existed when the offer should reasonably have been accepted. Strategic Lessons for Paying Parties The decision provides several important practical lessons for defendants and insurers. Early Part 36 Offers Can Limit Costs Exposure Making a well-judged Part 36 offer at an early stage of litigation can significantly reduce the potential costs exposure faced by a defendant. Where the offer is accepted late, the costs position may remain anchored to the earlier fixed costs framework rather than the more expensive regime that might apply later in the case. Late Acceptance Does Not Automatically Increase Costs Liability Claimants sometimes assume that if a case later leaves the fixed costs regime, the defendant’s costs exposure will automatically increase. The Court of Appeal decision demonstrates that such an assumption may be incorrect. The court may conclude that the claimant’s delay in accepting the offer means that the earlier fixed costs framework continues to govern the costs outcome. Settlement Timing Matters. A claimant who delays acceptance of a reasonable Part 36 offer risks losing the opportunity to recover higher costs that might otherwise have been available later in the litigation. Implications for Detailed Assessment Although fixed costs regimes are intended to avoid detailed assessment in many cases, disputes still arise regarding: • whether the claim falls within a fixed costs regime • the stage reached when an offer was accepted • the correct interpretation of the relevant Part 36 rules. In those circumstances, paying parties frequently prepare Points of Dispute for paying parties challenging the recoverability of costs claimed. Fixed Costs and the Expanding Civil Litigation Landscape The significance of these issues has increased following reforms expanding the scope of fixed recoverable costs in civil litigation. As fixed costs regimes apply to a wider range of claims, disputes concerning the interaction between Part 36 offers and fixed costs are likely to become more common. For a breakdown of the intermediate track fixed recoverable costs tables, see: https://www.sphcosts.com/post/intermediate-track-costs-table Conclusion Late acceptance of a Part 36 offer can have significant consequences for the recovery of litigation costs. In particular, where fixed costs regimes apply, a claimant may find that the recoverable costs remain limited to the framework that existed when the offer was made or when the relevant period expired. For paying parties, the decision highlights the continuing importance of early settlement strategy, careful use of Part 36 offers, and structured analysis of costs claims. These issues frequently arise during detailed assessment costs disputes, particularly where parties disagree about the applicable costs regime or the effect of late acceptance. See: https://www.sphcosts.com/detailed-assessment-costs-disputes Detailed Assessment Strategy Guides Detailed Assessment of Costs: The Complete Guide Paying Party Detailed Assessment Strategy How Paying Parties Challenge a Bill of Costs Proportionality Challenges at Detailed Assessment Fee Earner Delegation Challenges at Detailed Assessment Guideline Hourly Rates 2026 Intermediate Track Costs Tables

How Paying Parties Reduce Exposure Under CPR Part 47 Weak or generic Points of Dispute frequently result in avoidable costs being allowed. Points of Dispute are one of the most important documents in detailed assessment proceedings. They shape: whether the matter settles early; which issues the court focuses on; and ultimately how much of the bill is recovered. For paying parties, insurers, local authorities and defendant firms, effective Points of Dispute are rarely about challenging everything. The strongest disputes focus on the issues most likely to reduce overall exposure. If you require professional drafting support, see: Draft Points of Dispute Challenge a Bill of Costs Detailed Assessment Strategy What Are Points of Dispute? Points of Dispute are the paying party’s formal response to a Bill of Costs served under CPR Part 47. They identify: the items challenged within the bill; the reductions sought; and the legal or factual basis for each objection. In practice, Points of Dispute define the scope of the detailed assessment. They establish: which issues remain in dispute; the arguments relied upon by the paying party; and the areas likely to influence negotiation or assessment. Well-structured Points of Dispute focus on the areas most likely to affect recoverability and proportionality rather than disputing every line item indiscriminately. Why Points of Dispute Matter Poorly drafted Points of Dispute can materially increase costs exposure. Generic challenges frequently fail because: proportionality is not properly advanced; key weaknesses in the bill are missed; objections are repetitive rather than strategic; and the dispute lacks overall structure. Strong Points of Dispute, by contrast: identify the key pressure points within the bill; focus on recoverability and proportionality; challenge excessive rates and duplication; and create leverage for negotiation before assessment. Many detailed assessments are resolved without a final hearing. In practice, the quality of the written Points of Dispute often determines the outcome long before the court becomes involved. Paying Party Detailed Assessment Support We act for: insurers; local authorities; defendant solicitors; and organisations defending substantial costs claims. Our work includes: drafting structured Points of Dispute; proportionality challenges; delegation and fee earner grade arguments; hourly rate challenges; and wider detailed assessment strategy. Related services: Paying Party Detailed Assessment Challenge a Bill of Costs The Role of Points of Dispute in Detailed Assessment Points of Dispute do more than respond to a bill. They shape the entire detailed assessment process by influencing: whether settlement is achieved before assessment; the issues prioritised by the court; and how the bill is evaluated overall. Detailed assessment is not simply a line-by-line exercise. The court considers the bill against CPR principles of: reasonableness; necessity; and proportionality. For a wider overview of the process, see: Detailed Assessment of Costs Guide Precedent G and Points of Dispute Format Points of Dispute are usually drafted using the Precedent G format contained within the Costs Practice Direction. This structure allows: each item in the bill to be addressed clearly; the objection to be identified efficiently; and the dispute to be understood quickly by the court. The format generally includes: item reference; the paying party’s objection; any Reply from the receiving party; and the court’s determination. Courts expect disputes to follow this structured format so that the issues can be identified efficiently during assessment proceedings. When Must Points of Dispute Be Served? Under CPR Part 47, the paying party usually has 21 days from service of: the Notice of Commencement; and the Bill of Costs; to serve Points of Dispute. Failure to do so may result in a Default Costs Certificate being entered, allowing the receiving party to recover the full amount claimed without assessment. Need Urgent Support? We assist paying parties with: urgent Points of Dispute drafting; Default Costs Certificate applications; proportionality arguments; and detailed assessment strategy. See: Draft Points of Dispute Challenge a Bill of Costs Common Grounds of Challenge Hourly Rates Common challenges include: rates exceeding guideline levels; unsupported enhancement claims; and incorrect fee earner grading. Further guidance: Guideline Hourly Rates 2026 Delegation and Fee Earner Grade Typical issues include: routine work undertaken by senior fee earners; lack of supervision evidence; and inefficient allocation of work. Duplication of Work Challenges often arise where: multiple fee earners attend the same task; internal communications are excessive; or unnecessary review work has occurred. Proportionality Even where individual items appear reasonable, the overall bill may still be disproportionate. The court will consider: the value of the claim; complexity; conduct; and the importance of the litigation. Further guidance: Proportionality Challenges at Detailed Assessment Work Outside Scope Challenges may also arise where: unnecessary work has been undertaken; procedural failures have increased costs; or work was not reasonably required. Points of Dispute and Provisional Assessment Many Bills of Costs are determined through provisional assessment. This is usually a paper-based process where the written submissions carry significant weight. The court’s decision will largely reflect: the structure of the Points of Dispute; the quality of the Replies; and the clarity of the arguments advanced. Poorly drafted Points of Dispute are difficult to repair later in the process. Further reading: Oral Hearings Following Provisional Assessment How Points of Dispute Influence Negotiation Although Points of Dispute are a procedural requirement, their real commercial value often lies in negotiation. Strong Points of Dispute: expose weaknesses within the bill; increase pressure on proportionality and rates; and frequently lead to settlement before assessment. Weak or unfocused disputes rarely achieve meaningful reductions. For a structured paying party approach, see: Detailed Assessment Costs Disputes Points of Dispute as Part of a Wider Strategy Points of Dispute should not be viewed in isolation. Effective detailed assessment strategy usually combines: hourly rate challenges; delegation arguments; proportionality submissions; and recoverability analysis. The strongest paying party strategy identifies the issues most likely to influence the overall outcome rather than disputing every item mechanically. Related service: Paying Party Detailed Assessment Why Many Points of Dispute Fail In practice, Points of Dispute frequently fail because: challenges are generic rather than targeted; proportionality is not properly advanced; excessive focus is placed on individual items; and key weaknesses within the bill are not identified early. Courts are unlikely to be persuaded by unfocused disputes that lack structure or strategic relevance. The most effective Points of Dispute concentrate on the issues most likely to affect the final assessment outcome. Need to Challenge a Bill of Costs? We assist paying parties with: structured Points of Dispute drafting; hourly rate and delegation challenges; proportionality arguments; and detailed assessment strategy. We act for: insurers; local authorities; defendant solicitors; and organisations defending substantial costs claims. Services: Challenge a Bill of Costs Detailed Assessment Strategy Paying Party Detailed Assessment Draft Points of Dispute Related Costs Guides Detailed Assessment of Costs: The Complete Guide How Paying Parties Challenge a Bill of Costs Intermediate Track Costs Tables Guideline Hourly Rates 2026 Proportionality Challenges at Detailed Assessment Oral Hearings Following Provisional Assessment Related Costs Recovery Problems Paying parties frequently encounter challenges involving Bills of Costs, Points of Dispute, detailed assessment proceedings and costs exposure. For additional practical guidance on common costs issues, visit our Common Costs Problems resource centre: https://www.sphcosts.com/common-costs-problems

Even where litigation work has been properly carried out, recovery of costs is never guaranteed. On detailed assessment, the court does not simply ask whether work was done, it considers how the litigation was conducted, who carried out the work, whether the work was proportionate, and whether it was properly authorised and supervised. Reductions often arise not because the work was unnecessary, but because the way the costs are structured, evidenced, or presented creates avoidable assessment risk. Costs recovery ultimately depends on how litigation was conducted and how litigation costs are prepared and presented for assessment. Conduct and the Risk of Reduction on Assessment The conduct of the litigation is a central factor in assessment. Paying parties frequently argue that the receiving party’s approach led to unnecessary or disproportionate costs, even where the work itself was procedurally valid. Common Conduct-Related Issues Typical arguments include: Over-lawyering routine issues Pursuing marginal or low-value points Duplication of attendance Excessive internal communications Failure to narrow issues Unnecessary interim applications Even where such work had a rationale at the time, the court may take a retrospective view when assessing proportionality. Delegation, Fee Earner Grade and Supervision Who performs the work can be as important as the work itself. Assessment often involves scrutiny of who carried out the work and whether it was appropriate for that individual. Assessment judges often scrutinise: Whether tasks were delegated at an appropriate level The balance between senior input and junior time The level of supervision evidenced Instances where high-grade fee earners carried out administrative or routine tasks Inadequate delegation or unclear supervision can lead to reductions even where the work was otherwise reasonable. The assessment process is structured and evidence-driven rather than informal, reflecting how specialist costs are assessed in practice. Authorisation, Role Allocation and Recoverability Certain categories of work attract particular scrutiny, especially where: Multiple fee earners attend conferences or hearings Counsel and solicitors appear to duplicate roles Internal conferences or strategy meetings are frequent Time is recorded without clear purpose or outcome Assessment outcomes often turn on whether the structure of the legal team and the division of work can be justified. Work carried out outside the regulatory framework governing recoverable costs creates significant risk at assessment. Costs disputes often arise where proceedings are discontinued and re-issued, as demonstrated in a recent defended assessment involving pre-issue cost recovery. Presentation Risk: Why Bills Fail Even Where Work Was Proper A significant proportion of reductions arise from presentation rather than substance. Common issues include: Narrative descriptions that do not demonstrate purpose Block billing that obscures proportionality Failure to link work to issues or stages of litigation Inadequate evidence of complexity or importance Poor structuring of the bill The court must be able to understand why the work was done and why it was reasonable in the context of the case. Why Specialist Costs Input Reduces Risk Because detailed assessment is governed by procedural rules and judicial guidance rather than local practice, specialist costs professionals are often instructed to: Structure bills to align with assessment principles Present work in a way that evidences proportionality Anticipate common paying party challenges Reduce exposure to conduct-based arguments Support negotiation and assessment proceedings Early input frequently reduces both recoverability risk and the likelihood of protracted disputes. Summary Costs are not disallowed only because work was unnecessary. Reductions often arise from conduct, delegation, authorisation, proportionality, and presentation issues. Understanding how these factors influence assessment outcomes is essential for any party seeking to recover litigation costs effectively. For our full paying party detailed assessment service see: 👉 Detailed Assessment Paying Party Services 👉 Paying Party Costs Lawyers Detailed Assessment Strategy Guides Detailed Assessment of Costs: The Complete Guide Paying Party Detailed Assessment Strategy How Paying Parties Challenge a Bill of Costs Proportionality Challenges at Detailed Assessment Fee Earner Delegation Challenges at Detailed Assessment Guideline Hourly Rates 2026 Intermediate Track Costs Tables

The Difference Between Standard and Indemnity Basis Indemnity costs are not simply “higher” costs. They alter the approach the court takes to assessment. Under the standard basis, costs must be both reasonably incurred and proportionate. Under the indemnity basis, proportionality falls away and doubt is resolved in favour of the receiving party. This shift can materially affect the outcome of a detailed assessment. or a practical guide to how detailed assessment proceedings are conducted in practice, and how assessment strategy impacts recoverability outcomes, see our specialist costs support overview. When Do Courts Order Indemnity Costs? Indemnity costs are typically ordered where the court considers conduct to be “out of the norm”. This may include unreasonable litigation behaviour, refusal to engage in settlement, pursuing weak or exaggerated claims, or procedural misconduct. However, the threshold is not defined by rigid rules; it depends on judicial evaluation of the overall conduct of the litigation. Why Indemnity Costs Do Not Guarantee Full Recovery An indemnity costs order does not mean every item claimed will be allowed. Assessment still applies, and the court will still examine reasonableness. Excessive, duplicated or unnecessary work remains vulnerable. Indemnity basis shifts the margin of doubt — it does not remove scrutiny. The Role of Indemnity Costs in Between-the-Parties Disputes Indemnity costs arguments frequently arise in between-the-parties costs disputes, particularly where conduct, Part 36 consequences or litigation behaviour are raised as issues. These arguments can influence both negotiation strategy and the approach taken on detailed assessment. Indemnity Costs and Recoverability Risk Where conduct is criticised, arguments may extend beyond basis of assessment to questions of recoverability, delegation and proportionality. Indemnity costs disputes often intersect with wider issues about how litigation was conducted and how work is justified in the bill. Why Indemnity Costs Are a Strategic Issue For litigators, indemnity costs are often seen as a remedy. For costs professionals, they are a strategic variable that can alter risk exposure, negotiation leverage and the likely outcome of assessment proceedings. Understanding how the court applies the indemnity test in practice is therefore critical. Because indemnity costs disputes sit within the broader framework of assessment strategy and recoverability risk, they are typically addressed by specialist costs lawyers with experience of detailed assessment proceedings. Detailed Assessment Strategy Guides Detailed Assessment of Costs: The Complete Guide Paying Party Detailed Assessment Strategy How Paying Parties Challenge a Bill of Costs Proportionality Challenges at Detailed Assessment Fee Earner Delegation Challenges at Detailed Assessment Guideline Hourly Rates 2026 Intermediate Track Costs Tables