Costs in small claims process

Seventeen individuals in Bergen brought an action against property company to obtain ownership rights to a stretch of road and succeeded in the District Court.

Section 10-5 (2) of the Dispute Act provides that in cases governed by the Act’s rules on small claims proceedings, the successful party may not be awarded more than 20 percent of the disputed amount in costs for legal assistance.

The question was whether the 20 percent cap applies as a collective limit for all the successful parties together, or whether each individual could be awarded an amount within the cap.

The Supreme Court established that the limitation applies to each individual successful party. A previous decision on the same issue by the Supreme Court’s Appeals Committee was thus upheld. However, the Court emphasised that section 20-5 of the Dispute Act, which limits recoverable costs to what is necessary and reasonable, is of particular importance in small claims cases involving multiple parties on one side or the other.

Two justices dissented, holding that the 20 percent cap constitutes a collective limit for all parties on the same side raising a joint claim.

The judgment clarifies how costs are to be assessed in small claims proceedings involving multiple parties on the same side.

Read the order from the Supreme Court (Norwegian only) (PDF)

Area of law: Civil procedure, sections 10-5, 20-5 and 20-6 of the Dispute Act.

Key paragraphs: 23–33 and 37  

Justices: Øie, Falch, Høgetveit Berg, Steinsvik, Hellerslia