Cost Law Commentary

Cost Implications on dismissal of a counterclaim or third party claim

We've recently come across an inconsistency in the Supreme, County and Magistrates Court Rules, with implications that litigators should be alert to. Order 63A.16 of the County Court rules provides that dismissal of a counterclaim or third party claim carries costs with it, unless the court otherwise orders. No such provision exists in the Supreme Court Rules.

The reason that litigators should be aware of this rule is that there are many instances where such claims are dismissed without adjudication on the merits, or because they are settled. In such circumstances, consideration may need to be given as to whether an order should be sought, specifically providing that no costs are payable, or awarding costs to the claimant.

On the other hand, because of the absence of the provision in the Supreme Court Rules, when finalizing a matter, consideration must always be given as to the appropriate orders to be sought regarding the costs of a counterclaim or third party claim.