Jurisdiction(s):
United Kingdom

Related legal acts

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...

Ending trusts and trustee retirement: trustee indemnities and liens, contractual liability, section 27 TA 1925 notices, beneficiary indemnities and releases (England and Wales)

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Practice notes

Trustees may recover an indemnity from the trust fund in respect of expenses, including:

administration costs
the costs of proceedings against third parties
trust proceedings

The need to seek an indemnity commonly arises on final distributions, when trustees could face liabilities arising later. It also frequently comes up when trustees retire.

Administration expenses

A trustee is entitled to be reimbursed from the trust fund for expenses properly incurred while acting for the trust. Examples include:

trustees’ fees
investment management fees
legal or accounting fees

After establishing the extent of any outstanding liabilities for trust expenses, the trustees should set aside a reserve to cover the anticipated amounts. Section 27 of the Trustee Act 1925 (TA 1925) enables trustees to protect themselves by placing notices for interested persons (beneficiaries and creditors) in an appropriate newspaper or gazette and, where land is concerned, also in a newspaper circulating in the district in which the land is located...

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Web page updated on 21/05/2026

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