A further definition from The (Alternative) Legal Costs Dictionary:
Proportionality advs. a theoretical legal concept whereby the court will not allow legal costs to be recovered that are disproportionate to the amount at stake. An example of proportionality being applied by the courts has yet to be reported.
Rather reminds me of an Assessment I conducted in a Yorkshire County Court circa 1999/2000 when the DJ said "you need not concern yourselves Gentlemen on Proportionality, by the time I have finished with the bill the costs will be very proportionate" He then proceeded to take off about £20!
I certainly hope that proportionality remains largely theoretical, as its application could have a chilling effect upon litigation where a small monetary value (yet a large non-monetary value) is at stake.