What is the basis for recoverable costs of litigation?

The basis for recoverable costs of litigation typically includes multiple elements that reflect not only the direct expenses incurred but also the broader financial implications of pursuing a legal action. The correct choice highlights that costs can encompass the amount involved in the litigation, disbursements, and interest on costs.

This comprehensive approach to determining recoverable costs recognizes that when a party engages in litigation, they incur various identifiable expenses. The amount involved represents the stakes of the case, which can influence the cost recovery process. Disbursements, which cover necessary out-of-pocket expenses such as court fees, expert witness fees, and other related costs, are crucial for a complete picture of financial outlay incurred during litigation.

Including interest on costs acknowledges that the party seeking recovery has effectively advanced funds for legal expenses that could have been utilized elsewhere, justifying additional compensation for the time value of that money. This consideration serves to more fairly restore the party to the position they would have been in had they not engaged in the litigation in the first place.

The other options fail to fully account for all the components that can be considered when calculating costs, thereby not reflecting the holistic view of litigation expenses that the correct answer provides. By considering the interplay of the amount at stake, the actual dis