In the realm of litigation, the issue of costs can often be as crucial as the outcome of the case itself. Understanding how costs are awarded by South African courts is essential for both litigants and legal practitioners alike. In this guide, we delve into the intricate details of court-ordered costs in South Africa, exploring the rules, principles, and types of cost awards that may arise during legal proceedings. 

General Principles of Cost Awards 

In South African litigation, the allocation of costs is governed by a set of fundamental principles outlined in both statutory provisions and common law precedents. According to Section 80 and Rule 33 of the Magistrates' Courts Act, costs in Magistrates' Courts are regulated, while the High Court applies common law principles to cost allocation. The cornerstone principle is that costs are at the discretion of the court, guided by considerations of fairness and reasonableness. 

Determining the Successful Party 

One of the key determinants in cost allocation is identifying the successful party. While the general rule dictates that the successful litigant is entitled to costs, the court assesses success based on the substance of the judgment rather than its mere form. For instance, even in cases of absolution from the instance where neither party outright wins, the court may award costs to the party substantially successful in the litigation. 

Discretion to Deprive or Order Costs 

The court may exercise its discretion to deprive a successful party of costs or order the unsuccessful party to pay costs, either in part or in full. Factors influencing this discretion include the parties' conduct during litigation, such as excessive demands, unnecessary procedural steps, or misconduct. 

Tariffs of Costs and Attorney Fees 

In South Africa, costs are quantified based on tariffs provided in court rules. These tariffs delineate various legal tasks and associated costs. Attorneys charge their clients based on these tariffs or negotiated fees for professional services. Disbursements, such as court fees and expert witness expenses, are also factored into costs. 

Types of Cost Awards 

South African courts may make several types of cost awards, including: 

1. Party-and-Party Costs: These are the costs incurred by a party and ordered to be paid by the unsuccessful party based on court tariffs. They provide partial indemnity for legal expenses. 

2. Attorney-and-Client Costs: A more generous scale of costs awarded by the court to indemnify the successful party for legal expenses. These may exceed tariff rates in certain circumstances. 

3. Attorney-and-Own-Client Costs: Exceptional and punitive costs awarded in rare cases, aiming to indemnify the successful party for all legal expenses incurred fully. 

4. Costs de Bonis Propriis: Costs awarded against representatives, such as attorneys, who have conducted themselves improperly during litigation. 

5. Interim Costs Orders: Granted during proceedings for specific interlocutory procedures or adjournments, interim cost orders may be awarded on various scales and may be subject to final cost orders. 

Conclusion 

Navigating the complex terrain of court-ordered costs in South Africa requires a comprehensive understanding of statutory provisions, court rules, and case law precedents. By familiarising themselves with the principles and types of cost awards, litigants and legal practitioners can effectively navigate the cost landscape and make informed decisions throughout the litigation process. Should you need to enforce your cost order, contact an expert at Schoemanlaw Inc.  

Written by Johan De Lange, Schoemanlaw