The parties incur costs for exposure to the administration of justice, unless these are covered by free legal aid.
In disputes under property law, the legal costs are determined on the basis of the amount in dispute, i.e. the prosecuted amount, and they are usually charged to the losing party. Differentiation is made between the actual court fees and the payment of damages, which are due especially in the case of the professional representation of the opposing party.
Free legal aid
If a person is awarded free legal aid, he/she is exempt from the payment of court costs and the court appoints a lawyer to act on his/her behalf, provided that this is necessary for the protection of his/her rights. The awarding of free legal aid does not, however, grant exemption from the payment of damages to the opposing party. In addition, free legal aid is applicable to natural persons only and does not apply in the case of legal entities.
A person is eligible for free legal aid if:
- he/she does not possess the necessary funds; and
- his/her petition does not appear to be futile.
The court can demand advance payment from the plaintiff for the expected court costs and a bond for compensation to be paid to the opposing party in respect of the lawsuit. Such caution money comes into question, in particular, if the plaintiff:
- has no registered office or domicile in Switzerland;
- appears to be insolvent, especially if bankruptcy or composition proceedings have been initiated against the plaintiff or certificates of unpaid debt exist;
- owes legal costs from previous litigation; or
- other grounds exist which would significantly compromise the payment of compensation to the opposing party.