'PARTY / PARTY COSTS' - potential disappointment for a winner and a loser!

These costs are likely to be lower than the costs your lawyer will charge you. If this has not been explained to you, you will be disappointed. On occasions the amount you will recover from your opponent will be less than ½ of the amount that it has cost you.

If you lose a court case, you also will be disappointed because you have to pay your own lawyer's costs and the costs of the other party. This can bankrupt you.

Another potential problem for 'a winner' in a court case is that you may never recover the costs which the court has awarded you. If the other party does not have the means to pay the costs, you cannot get 'blood out of a stone' and all your efforts will have been wasted.

The moral is that before you sue or defend a claim, make sure that you have good prospects of success and you sue someone who has the money to pay you. This is why insurance companies, large businesses and government departments are good prospects for court actions. You can be almost sure to receive your money.

A little example from the Magistrates Court. The fees which your lawyer will charge will most likely be on the Supreme Court Scale (refer to the 1st page of this section), but you will only get an award against the other party on the Magistrates Court Scale. This Scale is much lower than the Supreme Court Scale. As a result you will be out of pocket by a considerable amount.

Even in proceedings in the Supreme Court, the lawyer representing you will more than likely charge you more than you will receive from 'the loser'. This means that in a compensation case where you are given a judgment for $100,000.00 plus costs, it is possible you will only receive $90,000.00 in your pocket.

Before you take court action, make sure that you understand 'party / party costs' and why 'solicitor / client costs' are different.

The next page will explain 'disbursements'.