The court may order costs to be paid to or by a person who is not a party to the proceedings in which those costs have been incurred. Such an order is likely to be made only in exceptional circumstances. Where the court is considering making such an order, that person must be added as a party to the proceedings and must be given a reasonable opportunity to attend the hearing at which the court will consider the matter further (CPR 46.2) (and see CPR Part 19 as to adding a person as a party). When the court makes such an order, the costs awarded can only be those incurred in the proceedings before it.

Guidance as to the circumstances in which a non-party costs order may be made is provided in Dymocks Franchise Systems (NSW) Pty Ltd v Todd [2004] 1 WLR 2807. As to the liabilities of professional funders, who have financed part of a Claimant’s costs of litigation, to pay a contribution towards the costs of a successful defendant see Arkin v Borchard Lines Ltd & Ors [2005] 1 WLR 3055; [2005] 3 All ER 613.