What is it?
This term functions as a broad contractual or procedural clause type governing recovery entitlements between litigants or business partners.
all costs
UCC / CommercialLegal glossary term
Quick answer
All costs usually means every expense incurred during a legal matter or transaction. In contracts, it matters because it dictates who pays when things go wrong in dispute resolution. Before signing, check if 'attorney's fees' are explicitly included within this scope.
Definitions
What is all costs?
Legal Definition
All costs encompasses every expense incurred by a party during a legal proceeding or transaction. This inclusion grants the prevailing party the right to recover those outlays from the losing side, often codified in statutes like Rule 44 of the Federal Rules of Civil Procedure. The critical distinction lies between 'costs' generally and specific terms like 'attorney's fees.'
Plain-English Translation
All costs means every single penny spent on a trip—gas, snacks, tolls. If you win the argument about who gets to ride shotgun, you get reimbursed for everything in that tally.
Contract relevance
Why all costs matters in contracts
Failing to define 'all costs' clearly can lead to disputes over what is recoverable, potentially resulting in the losing party absorbing unexpected financial burdens. The claimant bears the risk of ambiguity.
Document context
Where all costs appears in documents
| Document type | Section | Why it matters |
|---|---|---|
| Service Agreement | Termination Clause | Determines recovery rights post-contract end |
| Lease Agreement | Default Section | Defines expenses recoverable upon lease breach |
| Settlement Agreement | Payment Schedule | Specifies who bears the litigation outlay |
| Indemnification Clause | Scope of Indemnity | Clarifies what types of costs are covered by a promise |
Contract language
Common contract wording
| Contract wording | Plain-English meaning | What to check |
|---|---|---|
| All costs associated with this agreement | Every expense tied to this contract | Ensure 'attorneys' fees' is listed within it |
| Costs and expenses | Everything spent, generally speaking | Does it cover filing fees or just hourly rates? |
| Indemnified party shall recover all costs | The protected side gets paid back for everything they spent | Verify if the language implies a cap on recovery |
Red flags
Red flags to watch for
Wording examples
Clearer wording examples
Vague wording
All costs
Clearer wording
All reasonable and necessary expenses, including attorneys' fees and court filings
Vague wording
Costs and expenses
Clearer wording
All outlays, encompassing legal representation, expert witness fees, and administrative charges
Note: “clearer” means easier to read — not legally reviewed or guaranteed safe.
Pre-signature checklist
What to check before signing
1
Does it explicitly include 'attorneys' fees'?
2
Is there a cap or limit on the recovery of these costs?
3
Are administrative/filing fees covered under this umbrella?
4
Does it specify which party has the right to *recover* them?
5
Does it cover expenses incurred pre-signing?
6
Does it distinguish between actual vs. estimated costs?
Party impact
How all costs affects each party
| Party | What this party should check |
|---|---|
| Client (as recipient) | Ensure recovery is guaranteed for all necessary outlays, not just lawyer time. |
| Seller/Service Provider (as incurring party) | Confirm the scope covers every legitimate expense you pay to fulfill obligations. |
| Losing Party | Verify that your expenses are not excluded by a narrow definition of 'costs'. |
| Buyer (in purchase agreements) | Make sure title costs and inspection fees fall under this broad recovery umbrella. |
Comparison
all costs vs similar terms
| Related term | Plain meaning | Main difference from all costs |
|---|---|---|
| Attorney's Fees | Legal representation charges only | All costs is broader; it includes these plus filing fees, expert witness bills, etc. |
| Damages | Monetary compensation for a loss or injury | Damages are the *result* of the breach; all costs are the *expense incurred* while dealing with the breach. |
| Outlays | A general term for money spent | All costs is more formal and usually tied to legal recovery mechanisms. |
Missing or vague
If all costs is missing or vague
If 'all costs' lacks definition, a dispute may erupt over whether routine administrative fees count. Another issue arises regarding what constitutes 'reasonable' when attorneys' fees are included in the pool. Furthermore, without clarity, one party might argue that only their own direct legal bills qualify for reimbursement.
Document map
Document section map
| Contract section | What to inspect |
|---|---|
| Definitions Section | Where the term is first defined and clarified |
| Termination Clause | To determine who pays to unwind a relationship |
| Dispute Resolution/Arbitration Clause | Dictates which side gets reimbursed upon resolution |
| Indemnification Clause | To define what expenses are passed from one party to another |
Visual model
Understand all costs fast
An explainer image has not been generated for this term yet.
01
Landlord sues tenant and recovers all costs (e.g., eviction filings, jury fees) after winning in small claims court.
02
Franchisor demands borrower pay all costs associated with breach litigation, including travel and paralegal bills.
03
A service contractor secures payment for all costs listed in the contract, which includes equipment rental beyond the quoted price.
Document context
How all costs shows up in legal documents
Why does it matter?
Failing to define 'all costs' clearly can lead to disputes over what is recoverable, potentially resulting in the losing party absorbing unexpected financial burdens. The claimant bears the risk of ambiguity.
When does it matter?
The claim for all costs usually triggers when judgment is entered by the court or when a settlement agreement formally executes its terms.
Where is it usually seen?
You see this phrase frequently within standard commercial contracts, particularly indemnification clauses, and in litigation filings under various state rules of civil procedure.
Who is affected?
A prevailing creditor gains the right to recover their legal expenses from an indebted borrower. Conversely, a losing tenant risks having rent payments supplemented by all associated court costs.
How does it work?
First, a party incurs specific expenditures—like filing fees or expert witness time. Then, they must present documentation proving those outlays meet the contract's definition of 'costs.' Finally, the judgment dictates whether those documented expenses are awarded to them.
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Wikipedia
All costs
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Where all costs connects to real contract work
This layer links the term to nearby glossary entries, document use cases, and contract-risk guides so readers can move from definition to context without dead ends.
9nodes
Glossaryindemnificationindemnification often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause a...Glossaryindemnityindemnity often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause around...Glossaryagreementagreement often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause around...
BGRisk context hubGlossary meaning, document paths, and adjacent risk pages connected around this clause.
Use caseAnalyze Partnership AgreementBusiness & Commercial Contracts: Analyze a Partnership Agreement online and spot risky wording fast.Use caseCheck Consulting AgreementBusiness & Commercial Contracts: Check a Consulting Agreement for common risks and hidden one-sided clauses.Use caseAnalyze Service AgreementBusiness & Commercial Contracts: Analyze a Service Agreement online and spot risky wording fast.RiskAttorney fees clause riskPlain-English risk guide for attorney fees clause risk.RiskPrevailing party fees riskPlain-English risk guide for prevailing party fees risk.RiskHidden fees contractPlain-English risk guide for hidden fees contract.
Source & disclosure
This page is an AI-assisted plain-English explanation based on LexPredict Legal Dictionary context and contract-review patterns. It is not legal advice. Meaning may vary by jurisdiction, industry, and exact clause wording.
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