Opinion ID: 784819
Heading Depth: 2
Heading Rank: 3

Heading: mungo's bill of costs

Text: 42 Finally, Mungo argues that Judge Wedoff erred by failing to award her costs as the prevailing party. Although Bankruptcy Rule 7054 provides that the court may award the prevailing costs, the courts have held that there is a rebuttable presumption that the prevailing party is entitled to costs. Congregation of the Passion, Holy Cross Province v. Touche, Ross & Co., 854 F.2d 219, 221-22 (7th Cir.1988). Thus, [g]enerally only misconduct by the prevailing party worthy of a penalty ... or the losing party's inability to pay will suffice to justify denying costs. Contreras v. City of Chicago, 119 F.3d 1286, 1295 (7th Cir.1997). The courts review a lower court's decision to impose costs for an abuse of discretion. See Spegon v. Catholic Bishop of Chicago, 175 F.3d 544, 550 (7th Cir.1999). This discretion is narrowly confined because of the strong presumption created by [this rule] that the prevailing party will recover costs. Contreras, 119 F.3d at 1295. 43 Taylor points out that under Bankruptcy Rule 7068 a prevailing party forfeits the right to costs where that party rejects a Rule 7068 offer of judgment. On its face though, Rule 7068 applies only to costs incurred after the prevailing party rejects an offer of judgment. Taylor cites no authority for the proposition that a Rule 7068 offer of judgment forecloses costs incurred prior to the rejection of the offer. Further, Taylor cites no authority for the proposition that the rejection of a Rule 7068 offer of judgment rises to the level of misconduct that would justify the denial of costs. 44 Taylor concedes that Mungo incurred at least $3,095.33 in costs prior to rejecting Taylor's offer of judgment. Nonetheless, Judge Wedoff denied Mungo's bill of costs in its entirety without explanation. Ordinarily the denial of costs to a prevailing party must be accompanied by an explanation of the lower court's good reasons for this denial. See Weeks v. Samsung Heavy Indus. Co., Ltd., 126 F.3d 926, 945 (7th Cir.1997); Congregation of the Passion, 854 F.2d at 222. Here, Judge Wedoff failed to give any explanation for his denial of Mungo's bill of cost, and if this Court affirmed the bankruptcy court's decision in all other respects, Judge Wedoff's failure to explain the good reasons if any for the denial of costs would be grounds for reversal on that issue. As discussed in Section VI, supra, however, this Court reverses Judge Wedoff's decision in part with the effect that Mungo is no longer a prevailing party on her adversary claim and is, therefore, no longer entitled to the presumption that costs should be awarded to her. 45