7 Rolls Buildings
London EC4A 1NL
B e f o r e :
| MUSION SYSTEMS LIMITED
|- and -
|(1) ACTIV8-3D LIMITED
(2) C2R LIMITED
(3) DAVID DUTTON
(4) SIMON DAVID HUMPHREYS
The defendants did not appear and were not represented
Hearing dates: 1st February 2012
Crown Copyright ©
His Honour Judge Birss QC :
Adjournment of all consideration of the claimant's application
Please find enclosed my "statement of fitness for work" from my doctor which was issued yesterday. Unfortunately, due to this illness, I will not be able to attend the hearing on 1st February 2012. I was hoping I could be well enough to attend last minute, hence the lateness of my communication. Please accept my sincere apologies in this matter.
In regard to the arguments put forward by Browne Jacobsen in their most recent correspondence, we strongly contest these matters, in particular in regard to the case being dismissed, due to the weak financial position of activ8-3D and myself. We have explained to the claimant, that we simply cannot meet this payment of £46,000. We wish to have the opportunity to discuss these matters in full, either at the trial scheduled for 5th March 2012, or at another appointed hearing set by the court.
For clarification, we intend to revoke Musion's GB patent, and we wish to continue on with this trial. We believe if we are not allowed to represent ourselves at court with our witness's and statements, this would prejudice our ability and opportunity to win this court case.
We politely ask the court to consider our position in this matter.
Would you please inform us whether you are prepared to appear by telephone at tomorrow's hearing if the court was minded to allow it? By way of confirmation, we will attend in person.
In any event, we assume that Paul Andrews will be attending the hearing tomorrow on behalf of Activ8-3D Limited as on previous occasions. We have received confirmation that the hearing will take place in Court 6.
With reference to your email, for this hearing scheduled 1st February 2012, Simon was to attend on behalf of Activ8-3D Ltd and himself of course, as I was /am not available to attend on this date, due to other commitments.
Dear All, As I have outlined I am unable to attend this hearing due to my illness. On advice, I am not prepared to appear by telephone. Warm Regards, Simon Humphries
i) First, whatever the position of Mr Humphries himself, there is no good reason why Activ8 is not represented at this hearing at least by telephone. Mr Andrews has represented Activ8 in the past. All that is said is that he is not available due to "other commitments". No detail is provided and I do not place any weight on that. Even if Mr Andrews could not attend in person, there is no good explanation why he could not have attended by telephone. Facilities can be made for that.
ii) Second, as regards Mr Humphries, the position concerning his health is unspecific. No detail is provided apart from the Doctor's note. It is not explained why Mr Humphries could not attend the hearing by telephone. As to attending by telephone, all Mr Humphries says is that "on advice" he is not prepared to attend that way. In other circumstances one might be prepared to make some allowances for a statement like that but I am not prepared to do so in this case. Mr Miller reminds me that in my judgment on the preliminary issue ( EWPCC 12) I ruled that Mr Humphries had not been a satisfactory witness. It would not be right to disbelieve what Mr Humphries has said here and I will accept Mr Humphries's statement as true as far as it goes. However it does not go far enough. The statement does not say that Mr Humphries cannot attend by telephone but rather that he is not prepared to do so, on advice. There is no indication who advised Mr Humphries or the nature of that advice: was it medical advice, legal advice or even the advice of Mr Andrews?
iii) Third I also bear in mind the general timing. When I made the costs order which has not been complied with, it was intended to apply before trial (see paragraph 7 of my judgment of 14th December). The sums were due on 4th January. The trial is due on 5th March. Adjourning this application risks prejudice to the claimant. The sooner this matter is resolved one way or the other, the earlier the claimant will know whether the trial is to go ahead. That may well lead to a substantial saving in costs.
iv) Fourth, a lesser consideration but one which is nonetheless relevant is that I do know what the defendants' position is in relation to the claimant's application. Of course if they attended then further submissions would be made but the defendants have made their essential point clear. They contend that they simply cannot meet the payment.
Reasons for making the unless order
17. But thirdly – and, to my mind, most importantly - the court's ability to make interlocutory costs orders following, in particular, the Access to Justice reforms in 1998, is a sanction which is available to it in order to encourage responsible litigation. The court marks what it regards as an irresponsible application by an immediate order for the payment of costs. That is intended to bring home to a party - when considering whether to make an application - that an unsuccessful application may carry a price which will have to be paid at once. If the court is not in a position to enforce immediate interlocutory orders for the payment of costs which it was thought right to make, then the force of that sanction is seriously undermined. It is important that, in cases where the court thinks it right to make an order for immediate payment on an interlocutory application, that it does have the power - and can exercise the power - to ensure that order is met. For the reasons which Patten J explained, the only effective sanction in a case of this nature is to require payment of interlocutory costs as the price of being allowed to continue to contest the proceedings. Unless the party against whom an order for costs is made is prepared to, or can be compelled to, comply with, that order, the order might just as well not be made.
18. That point attracted the judge, He said this, at paragraph  of his judgment:
"In any event I take the view that orders of the court, even in relation to interim costs, require to be complied with and that, unless there is some overwhelming consideration falling within Article 6 that compels the court to take a different view, the normal consequence of a failure to comply with such an order, is that the court, in order to protect its own procedure, should make compliance with that order a condition of the party in question being able to continue with the litigation."
For my part, I would hold that - whether or not a statement in such general terms can be supported – the proposition can be supported in a case (such as the present) where there is no other effective way of ensuring that the interim costs order is satisfied. That, of course, is always subject to what the judge referred to as the overwhelming consideration falling within Article 6: that orders requiring payment of costs as a condition of proceeding with litigation are not made in circumstances where to enforce such an order would drive a party from access to justice. But, for the reasons that the judge explained and to which I have already referred, this was not such a case.
i) The matter is always one for the court's discretion and all relevant circumstances fall to be considered;
ii) If the court is not in a position to enforce interlocutory costs orders the force of the sanction is seriously undermined;
iii) Other options apart from the order sought must be considered
iv) It is always important to have regard to Art 6 ECHR. Orders requiring payment of costs as a condition of proceeding with litigation are not made in circumstances where to enforce such an order would drive a party from access to justice.
5. [… ] Second the defendants argue that their current financial status is poor and they ask to defer the costs until the trial in March. […]
7. As regards the second point, the defendants have produced no evidence to back up their contention about finances. To some extent this also is an attempt to re-argue the issues on 24th October 2011. The reason for summarily assessing the costs thrown away was so that an order for their payment could be made now and in advance of the adjourned trial. The question of the defendants' financial status has been debated before in this litigation and the defendants know that if they wish to make the point they need proper evidence. There is none before me. The order I will make will be an order that the sum I will assess be paid within 21 days
i) Mr Miller submitted that it is apparent the defendants have access to legal advice. That is clear but I do not regard it as concrete evidence of access to funds. The advice could be pro bono although the defendants have never said that it is.
ii) The day after the trial was adjourned, which was another occasion on which they told the court they had no money, the first defendant started fresh legal proceedings before the EPO against the claimant in respect of another of the claimant's patents. (EP 2 141 540) The patent may be in the same family as the patent in suit but that does not matter. The first defendant has professional representation in those proceedings.
iii) Since the trial of the preliminary issue the first defendant has found the means to move offices and take a lease on a studio in Portland Place in the West End of London. As Mr Miller submits, that is hardly a cheap location.
Conclusion and costs