Wasted Costs Orders Against Lawyers in Singapore Company Litigation: When a Solicitor Must Personally Pay

When a company’s litigation runs off the rails, most directors assume the worst that can happen is losing the case. That assumption is wrong. Under Order 21 Rule 6 of the Rules of Court 2021, the Singapore High Court (General Division) can look past the losing party altogether and order that party’s own solicitor to personally pay costs, whether to their own client or to the other side, where the solicitor is responsible for incurring costs unreasonably in the proceedings. This is the “adverse costs order against solicitor”, sometimes still referred to by its older common law name of a wasted costs order, and it is a mechanic that company directors, in-house counsel and corporate service providers dealing with litigating clients need to understand.

This is a genuinely distinct animal from the costs orders most people have heard of. It is not about who wins or loses the underlying dispute, and it is not a non-party costs order against a director or funder standing behind an impecunious corporate litigant (a different jurisdiction entirely, addressed under Order 21 Rule 5). A wasted costs order targets the lawyer conducting the case, personally, for the way the case was run: applications that should never have been filed, pleadings that had no proper factual basis, or conduct that wasted the court’s and the other side’s time and money. For a Singapore private limited company that finds itself facing a large, unexplained legal bill after a matter goes badly, or that is on the receiving end of an opponent’s obviously improper tactics, this is a mechanism worth knowing exists.

This article sets out the statutory basis for adverse costs orders against solicitors in company litigation, the leading Singapore case law on when the jurisdiction is exercised, the step-by-step process for making such an application, realistic costs, and practical guidance for directors and corporate secretaries who encounter this issue in a company dispute.

The Statutory Basis: Order 21 Rule 6 of the Rules of Court 2021

Since the Rules of Court 2021 took effect on 1 April 2022, the court’s power to make costs orders against a solicitor personally is set out expressly in Order 21 Rule 6, headed “Adverse costs orders against solicitor”. This replaced the equivalent provision in the old Rules of Court (Order 59 Rule 8(1) under the 2014 Revised Edition), and the underlying principles carry through largely unchanged.

Order 21 Rule 6(1) provides that if a solicitor is responsible, either personally or through an employee or agent, for incurring costs unreasonably in the proceedings, the General Division of the High Court may:

• disallow the costs as between the solicitor and his or her client, in whole or in part;
• order the solicitor to repay to his or her client costs which the client has been ordered to pay in the proceedings; and
• order the solicitor to indemnify any other party in the proceedings for costs payable by them.

Two procedural safeguards sit alongside this power. First, under Order 21 Rule 6(2), the court must give the solicitor a reasonable opportunity to be heard, whether by oral hearing or written submissions, before making an order. Second, under Order 21 Rule 6(3), the court may direct that the solicitor’s own client be notified of the proceedings or order made against the solicitor. The court may also, under Order 21 Rule 6(4), direct or authorise the Attorney-General to attend and take part in the inquiry, reflecting the public interest in how the profession conducts litigation. The full text of the Rules of Court 2021 is available on Singapore Statutes Online.

This sits within the General Division’s broader costs jurisdiction under Order 21 Rule 2 (Powers of Court), which gives the court wide discretion over costs generally, and is distinct from Order 21 Rule 5 (adverse costs orders against non-party), which is the separate route used where a director, shareholder or litigation funder standing behind a company is asked to personally satisfy a costs order made against the company itself, and can matter greatly to a company whose corporate filings on the public register maintained by the Accounting and Corporate Regulatory Authority already show it as a small, thinly capitalised vehicle. We cover that separate mechanic in our article on discovery orders against third parties in Singapore company litigation, which touches on the related question of who else can be drawn into a company’s dispute.

Why This Matters for Companies, Not Just Individual Litigants

Company disputes are especially fertile ground for this jurisdiction for three reasons. First, corporate litigation tends to involve more interlocutory skirmishing (discovery applications, injunctions, striking out applications) than a typical personal dispute, which multiplies the opportunities for a solicitor to run up costs improperly. Second, where a company is a shell or impecunious, a costs order against the company alone may be worthless to the winning side, so scrutiny naturally turns to who was actually directing and paying for the litigation, including the conduct of the lawyers running it. Third, directors who instruct solicitors to pursue tactically aggressive but legally hopeless positions, whether in a shareholder dispute, a winding-up contest, or a validation order application under section 130 of the Insolvency, Restructuring and Dissolution Act, can find that the resulting costs bill lands not just on the company but potentially disallowed as against their own solicitor, changing who ultimately bears the loss.

The Leading Singapore Case: Bintai Kindenko Pte Ltd v Samsung C&T Corp

The leading Court of Appeal authority on when a personal costs order against a solicitor is appropriate is Bintai Kindenko Pte Ltd v Samsung C&T Corp [2018] SGCA 39. Although the underlying dispute concerned a construction adjudication rather than a company law matter, the Court of Appeal’s guidance on the wasted costs jurisdiction (then under Order 59 Rule 8(1) of the old Rules of Court) has been applied consistently since, including under the current Order 21 Rule 6.

The Court of Appeal held that a personal costs order against a solicitor may be appropriate where the solicitor advances a wholly disingenuous case, or files utterly ill-conceived applications, even though the solicitor ought to have known better and should have advised the client against that course of action. Importantly, the court emphasised that there is no closed or exhaustive list of what amounts to conduct that is improper, unreasonable or negligent for this purpose. Much depends on the specific facts and the conduct of counsel in the particular case, and the jurisdiction is exercised sparingly, given the seriousness of a finding that a member of the Bar acted improperly or unreasonably in the conduct of litigation.

For a company boardroom, the practical takeaway is that this jurisdiction is not triggered merely because a legal argument was weak or ultimately failed. Losing an argument, even a bad one, is ordinarily a risk the client bears, not the solicitor personally. The court is looking for something closer to an abdication of the solicitor’s own professional judgement: filing an application the solicitor must have known was hopeless, running a case built on assertions with no proper evidential basis, or ignoring clear signals from the court that a position could not be sustained. This is a materially higher bar than simply “we lost and the legal fees were high”. General guidance on how costs orders work in Singapore civil litigation is published by the Singapore courts at judiciary.gov.sg.

How This Interacts with Non-Party Costs and Security for Costs

Directors and corporate secretaries sometimes conflate three distinct costs mechanisms that can arise in the same dispute: a non-party costs order under Order 21 Rule 5 (aimed at a director, shareholder or funder standing behind the litigating company), an order for security for costs under Order 9 Rule 12 read with section 388 of the Companies Act 1967 (aimed at protecting a defendant against an impecunious corporate claimant before the case is even heard), and the adverse costs order against a solicitor under Order 21 Rule 6 covered in this article (aimed at the lawyer’s own conduct of the case). All three sit within the same Order 21 costs framework, and it is not uncommon for more than one to be raised in the same acrimonious dispute, but they ask entirely different questions and are supported by different evidence. Our companion piece on pre-action interrogatories in Singapore company disputes covers another pre-litigation tool that is sometimes used in tandem with these costs applications to test the strength of a claim before it is filed.

Step-by-Step: How an Adverse Costs Order Application Against a Solicitor Is Made

An application under Order 21 Rule 6 is not a free-standing action. It typically arises within the same court file as the substantive dispute, either raised by an aggrieved party or, in some cases, by the court’s own motion after observing the conduct of proceedings. The following is the general procedure followed in the General Division of the Singapore High Court.

1. Identify the trigger conduct. The applicant (usually the opposing party, sometimes the solicitor’s own client) identifies the specific instance or pattern of conduct said to amount to costs incurred unreasonably: for example, a striking out application filed with no proper basis, a discovery application pursued after the underlying claim had collapsed, or repeated adjournments caused by the solicitor’s own failures.
2. File the application by summons. The application is brought by summons within the existing court proceedings, supported by an affidavit setting out the conduct complained of, the costs said to have been wasted, and the causal link between the two. Where the underlying matter has already concluded, this is usually dealt with as part of the costs assessment process.
3. Serve the solicitor personally. Because the order is sought against the solicitor and not merely the client, the solicitor concerned must be served with the application separately, even though they may also be the solicitor on the court record for a party.
4. Court considers notice to the solicitor’s client. Under Order 21 Rule 6(3), the court may direct that the solicitor’s own client be told about the application, since an adverse finding can affect the client’s own position on costs (for example, whether costs are disallowed as between solicitor and client).
5. Solicitor is given an opportunity to respond. Order 21 Rule 6(2) requires the court to give the solicitor a real opportunity to be heard, whether through an oral hearing or written submissions, before any order is made. This is not a formality; the seriousness of the finding means the court will usually want a substantive response.
6. Court considers whether the Attorney-General should be involved. In appropriate cases, the court may direct or authorise the Attorney-General to attend and take part in the inquiry under Order 21 Rule 6(4), reflecting that professional conduct issues extend beyond the interests of the immediate parties.
7. Hearing and decision. The court determines whether the solicitor was responsible for incurring costs unreasonably and, if so, which of the three remedies (disallowance, repayment to the client, or indemnity to another party) is appropriate and in what amount.
8. Assessment of quantum. Where an order is made, the actual sum is usually fixed by the court or referred for assessment under the Registrar’s powers in Order 21 Rules 11 to 16, in the same way as any other costs assessment.

Illustrative Costs Table

The figures below are indicative ranges only, drawn from the general order of legal fees typically seen for an interlocutory application of this kind in the General Division of the Singapore High Court. Actual costs depend heavily on the complexity of the underlying dispute, whether affidavits are contested, and whether the Attorney-General’s Chambers becomes involved.

These are estimates for budgeting purposes and are not a quotation. A corporate service provider such as Raffles Corporate Services does not conduct this kind of application; it is squarely litigation work for a Singapore law firm, but understanding the likely cost profile helps a board decide whether raising the issue is proportionate. Where the underlying dispute also involves tracing misapplied company funds, our article on Bankers Trust orders in Singapore sets out a related but separate application, with its own distinct costs profile.

Practical Tips for Directors and Corporate Secretaries

• Keep a clear record of instructions. Where a company’s litigation runs into difficulty, board minutes and written instructions to solicitors are the first thing that gets scrutinised if a wasted costs argument arises, whether the company is the applicant or on the receiving end of one.
• Do not assume every lost application is a wasted costs case. As Bintai Kindenko makes clear, an unsuccessful argument is not, on its own, evidence of unreasonable conduct. The bar is considerably higher than “we lost”.
• Watch for the pattern, not the single event. Courts are more receptive to this jurisdiction where there is a pattern of repeated, avoidable procedural failures rather than one bad call made in good faith.
• Understand the separate but related company law risk. A director who personally directs hopeless litigation in the company’s name may separately face a non-party costs order, quite apart from anything the solicitor did. These two exposures often surface together in the same dispute.
• Get the corporate secretarial and legal roles right from the outset. Our article on the corporate service provider and law firm division of labour on a company court application sets out why this kind of costs application sits firmly with litigation counsel, not the corporate secretary, but why the two roles need to coordinate closely when a dispute escalates.
• Preserve correspondence with the solicitor. If a company suspects its own dispute was mishandled, contemporaneous email and instruction records make or break any later application, whether the target is the solicitor or the client is simply trying to have costs disallowed as between solicitor and client.

Conclusion

Order 21 Rule 6 of the Rules of Court 2021 gives the Singapore High Court (General Division) a targeted, if sparingly used, power to hold a solicitor personally accountable where costs are incurred unreasonably in the conduct of litigation. For Singapore companies, this sits alongside the related but distinct mechanisms of non-party costs orders against directors and funders, and security for costs orders against impecunious corporate claimants, forming a broader toolkit the courts use to keep the true costs consequences of litigation aligned with those actually responsible for it. Bintai Kindenko Pte Ltd v Samsung C&T Corp [2018] SGCA 39 remains the leading statement of principle, and its message for company directors is simple: a losing legal argument is a risk you bear, but an application your own solicitor should have known was hopeless is a different problem entirely, and one the Rules of Court are equipped to address. If you need legal advice on the court application process, we can point you in the right direction.

To speak with the team at Raffles Corporate Services, you can email [email protected] or call, SMS, or WhatsApp +65 8501 7133. We are happy to assist with any queries.

– The Editorial Team, Raffles Corporate Services