Preamble

SECTION I COSTS Article 456 – Liability for costs -The judgment which decides the suit or any of its incidents, shall award costs in favour of successful party, in proportion fixed by the court. If many plaintiffs and defendants have lost the case, they are liable to pay the costs in equal parts, unless there is a apparent difference in the degree of their participation in the cause, because in such case the costs shall be distributed according to the measure of participation. In case parties are held joint and severally liable, the joint and several liability shall extend to the costs. Articles 456-468 – Cost, fines and damages are in much greater detail - Corresponding provisions in C.P.C. 1908: - oCosts – S. 35, oCompensatory costs in respect of false or vexatious claims or defences – S.35A oCosts for causing delay – S.35B oPayment into court – O.XXIV oCosts – O.XX-A oSecurity for costs – O.XXV Article 457 – Acts and steps which do not count for costs - The liability of the defeated party does not extend to costs for superfluous acts and incidents, nor to the steps and acts which have been repeated on account of fault of any judicial officer, nor even to the costs towards

adjournment of the judicial act on account of absence of the person who ought to have appeared. § 1: Acts and incidents, unnecessary for declaration or defence of the rights should be taken as superfluous. The costs of such acts will be on the account of the one who applied for the same. The costs of other acts which are excluded shall be paid by the employee or respective person. § 2: The officer who has given cause for annulment of the act shall be answerable for annulment, besides disciplinary liability. Article 458 – Costs on Plaintiff - When the defendant has not given cause to the suit and he does not contest the suit, the costs are paid by the plaintiff. It is understood that the defendant did not give cause to the suit: 1: When the plaintiff does not assert the existence of any previous obligation of defendant and proposes to simply exercise a legal right; 2: When the obligation of the defendant accrues only after service of summons or after institution of the suit as declared in clause (a) and (b) of article 662; 3: When the suit is not founded on any illicit fact committed by the defendant. 4: When the plaintiff, being armed with a title with executive force, unnecessarily uses a suit for declaration. See also Article 46 of this Code. Article 459 – Distribution of costs - If the opposition of the defendant was founded when the cause has arisen but on account of supervening circumstances ceased to be operative, each party shall pay the costs in relation to the acts done during the period in which there was unjustified activity. Article 460 – Costs in case of admission, abandonment or compromise - When the suit ends by abandonment or admission, the costs shall be paid by the party who abandoned or admitted the claim. And if the abandonment or admission was partial, the liability towards costs shall be proportionate to the part of abandonment or admission. In the case of compromise, the costs shall be borne equally except if otherwise agreed upon. Article 461 – Liability of assistant for costs - Whoever has intervened in the suit as assistant

shall be awarded, if the assisted party looses the case to the extent of proportionate share of the costs shall be payable by the latter, in proportion to the activity which he has exercised in the proceedings, but never exceeding (1/10) one tenth. Article 462 – Costs of preventive and conservatory proceedings, conciliation and

notifications - The costs of preventive and conservatory proceedings shall be paid by the

applicant when there is no opposition, but shall be taken into consideration in the suit instituted. If there is opposition, what is provided in article 456 shall be followed. § 1: The costs of settlement shall be paid by the defendant when he acknowledges the right of the plaintiff and to the extent to which there is acknowledgment. § 2: The costs of sundry notices shall be paid by the applicant.

Article 463 – Payment of legal fees through costs - The attorney on record and technical

experts of the winning party may apply that amount due to them towards fees, expenses and advances made, total or partially, be satisfied from the costs recoverable from the losing party. If they apply for the same, winning party will be heard and decision will be passed. § Sole Paragraph: If the winning party disputes the amount of credit in favour of attorney, only the portion not disputed shall be paid. Article 464 – Security of costs - The costs always shall be deducted from the amount realized from the assets and when the costs arise from contract, only after the payment, the execution can be enforced, a certified copy or any other document, which demonstrates satisfaction of the decision with or which the same document may be executed and registered. SECTION II FINES AND DAMAGES Article 465 – Liability in case of bad faith in litigation – Definition of Bad faith – If the party has filed vexatious proceedings, fine shall be imposed on him and compensatory costs to the adversary, if the latter demands it. A litigant is considered to be in “bad faith”, not only if he who puts up a claim or raises an

objection, of which the lack of foundation, he could not be reasonably ignore, but also who has consciously altered the true facts or omitted essential facts and who has made use of the wrong proceedings or remedies the purpose of obtaining illegal objective or has impeded the course of justice or the discovery of the truth. § Sole Paragraph: The winning party may also be considered a litigant in bad faith, even in the main suit, when he has acted with instrumental malice. Article 466 – Contents of damages - The compensation by way of damages may consist: a) In the reimbursement of the expenses occasioned to the opposite party, by the malafides involved, including the fees of the Advocate and Technical experts; b) In the satisfaction of the remaining losses sustained by the opposite party; The judge shall direct payment of the damages which may be found adequate to the conduct of the losing party, fixing it always in specific amount. § 1: If there is no data for fixing the amount of the damages in the judgment after hearing the parties they shall be fixed by the judge at his prudent discretion, as deemed reasonable and reducing to just limits the items of expenditure and fees quoted by the party. § 2: The fees shall be paid directly to the advocate except it is found that they are already paid by the client. Article 467 – Liability of representative of legally disabled or of collective persons – When the party is legally disabled or a collective person, the liability for costs, fine and damages shall be on their representatives, if they have acted in bad faith.

Article 468 – Liability of advocate - When it is found that the mandatary of the party had

personal and direct responsibility which revealed bad faith in his part, the matter will be reported to the Bar council of the advocates or body of solicitors (legal advisors), in order that they apply respective penalties and punish the mandatary to the extent of their share in the costs, fine and damages which they deem fit.