Jurisdiction(s):
United Kingdom

Key definition

Costs definition

What does Costs mean? In litigation, costs are the legal fees, disbursements, court fees and VAT incurred in bringing, defending or appealing a claim, and the sums a court or tribunal may order one party to pay another for those liabilities. The concept is governed by procedural rules and case law rather than a single statutory definition: England and Wales (CPR 44–47), Northern Ireland (RCJ Ord 62), Scotland (where the equivalent term is expenses), and Ireland (Legal Services Regulation Act 2015 and the Legal Costs Adjudicators). The general approach is broadly consistent, subject to local terminology and procedure. Typical features include the discretionary rule...

Precedent R Costs Budget Discussion Reports: Completion, Filing, Sanctions and Multi-party Litigation under the CPR (England and Wales)

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Practice notes

This Practice Note explores what a Budget discussion (BD) report is, when one is required, and the suggested template it should follow (Precedent R). It also offers direction on completing Precedent R and highlights possible complications in cases involving multiple parties. A set of frequently asked questions (FAQs), with answers, is included on BD reports and likely issues...

What are Costs budget discussion (BD) reports?

Under the costs management regime, brought in as part of the Jackson Reforms, parties must co-operate and attempt to agree each other’s costs budget. If agreement is reached, the court records it in the costs management order (CMO) (CPR 3.15(2)(a) and CPR 3.15(2)(c)). Where agreement is not achieved, the court reviews the items in dispute and makes any amendments it considers appropriate before approving the budget. For further detail, see Practice Notes: Costs management and costs budgeting—general principles and Costs budgeting—courts’ approach. Before 2016, no formal process existed for parties to seek agreement or to present disagreements on budgets to the court. In practice, this created difficulties for the courts, and some judges specifically asked parties to provide a costs schedule identifying what was agreed and what was not...

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Web page updated on 22/05/2026

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