costs recovery
📖 What is costs recovery? Meaning and definition
In New Zealand tenancy law, costs recovery allows a party who has won their case at the Tenancy Tribunal to seek payment from the other party for expenses related to the application. This typically happens after the Tribunal has made a decision on the main issue, and then considers submissions specifically about costs. The Tribunal has the discretion to award costs, and the usual rule is that 'costs follow the event,' meaning the party who loses the case pays the costs of the party who wins.
These recoverable costs can include various expenses. Examples from actual cases show that these might cover manager's charges, solicitor's charges for preparing the case and for hearing time, and filing fees. The aim is to compensate the successful party for some of the financial burden of pursuing or defending the application.
To claim costs, the successful party usually needs to provide evidence of the 'actual and reasonable costs incurred,' often with time records for work done. The Tribunal will then assess these claims. While parties can make submissions on why costs should or should not be awarded, the Tribunal ultimately decides based on the information provided and its discretion under relevant legislation.
📋 Requirements
- A party must be successful in their application to the Tenancy Tribunal.
- The Tribunal must have made an order in the substantive application.
- Submissions regarding costs must be made to the Tribunal.
- Evidence of actual and reasonable costs incurred should be provided.
📝 Procedure
- The Tenancy Tribunal makes an order on the main application.
- Costs are reserved for later consideration.
- Parties are directed to make submissions in relation to costs.
- Parties provide evidence, such as time records, for costs incurred.
- The Tribunal reviews submissions and evidence, then issues an order for costs.
💡 Examples
- A property owner successfully applies to the Tenancy Tribunal for unpaid levies and is awarded costs for their manager's time, solicitor's fees, and the filing fee.
- A tenant wins their application against a landlord and is subsequently awarded nearly $20,000 in costs following the Tribunal's initial order.
- A company successfully enforces operational rules and is awarded over $3,500 for the actual and reasonable costs it incurred, supported by time records.
- A unit owner is ordered to pay a body corporate over $8,000, which includes unpaid levies, interest, solicitor's charges for the hearing, and the application filing fee.
📚 Legal basis
- Unit Titles Act 2010
❓ Frequently asked questions
What kind of expenses can be recovered?
Recoverable expenses can include things like manager's charges, solicitor's fees for preparing and attending hearings, and the filing fee for the application itself, provided they are deemed actual and reasonable by the Tribunal.
Do I automatically get my costs back if I win?
Not automatically. While the 'costs follow the event' rule is common, you still need to make a claim for costs and provide evidence of your expenses. The Tribunal then decides whether to award them and how much.
What does 'costs reserved' mean?
When costs are 'reserved,' it means the Tenancy Tribunal has decided to deal with the main application first and will address the issue of who pays costs at a later stage, usually after receiving further submissions from the parties.
How do I prove my costs?
You typically need to provide evidence such as invoices, receipts, or detailed time records showing the expenses you incurred and why they were necessary for your application. This helps the Tribunal assess if the costs are actual and reasonable.
Can the other party also claim costs?
Yes, if the other party was successful in their application or defence, they can also claim costs. However, if they were the unsuccessful party, their application for costs would typically be dismissed, as costs usually follow the event.
Is there a limit to how much I can recover?
The Tenancy Tribunal considers whether the costs are 'actual and reasonable.' While there isn't a fixed maximum amount, the Tribunal exercises discretion to ensure the awarded costs are appropriate for the specific case and the expenses genuinely incurred.