Default costs certificates: obtaining one and setting one aside

Under CPR 47.9, the paying party has 21 days after service of the notice of commencement to serve points of dispute, unless the time is extended. If none are served, the receiving party may file a request for a default costs certificate, which will include the full bill costs and fixed costs of the request.

Points of dispute served before the certificate is issued prevent the certificate being issued, even if they are late. Receiving parties should therefore check carefully whether anything has been served before filing their request.

CPR 47.12(1) requires the court to set aside a default costs certificate if the receiving party was not entitled to it, for example because points of dispute had been served or the notice of commencement was defective. In those circumstances, the paying party need not show any further reason.

This underlines the importance of correct service. A notice of commencement served on the wrong address, or missing the required documents, may undermine the receiving party’s position.

Under CPR 47.12(2), the court may set aside or vary a certificate if it appears there is some good reason why detailed assessment should continue. Practice Direction 47 requires an application to be supported by evidence and, in most cases, a copy of the proposed points of dispute.

The court considers whether the application was made promptly. Courts have applied the principles of relief from sanctions in some decisions, assessing seriousness, reasons and all the circumstances. Delay of even a few weeks without a good explanation can be fatal, so paying parties should prepare and file applications quickly.

Where the court sets aside a certificate on a discretionary basis, it may impose conditions, such as payment of a sum on account or payment of the costs of the application. These conditions can be significant, and the paying party should be ready to address them.

For receiving parties, a default costs certificate can be a powerful lever in negotiations, but it is best used with care. Our Costs Lawyers advise both sides on default certificates, including urgent applications to set aside.