Jersey Unreported Judgments

[2003]JRC060

royal court

(Samedi Division)

31st March 2003 

Application by the Defendants for indemnity costs following an uncontested application by the First and Second Defendants to strike out the Plaintiffs' Orders of Justice.

Advocate C.G.P. Lakeman for the Plaintiffs.

Advocate D.F. Le Quesne for the First and Second Defendants

Advocate A.J.D. Winchester for the Third and Fourth Defendants and

for the First and Second Parties Cited.

judgment

the bailiff:

1.        Mr Le Quesne has asked for the First and Second Defendants costs to be paid by the Plaintiffs on an indemnity basis.  Mr Winchester has asked, (1) that it be confirmed for the avoidance of doubt that the costs of the Third and Fourth Defendants be paid on an indemnity basis out of the Trust Fund; and (2) notwithstanding that order, that an order be made against the Plaintiffs condemning them to pay those costs back to the Trust Fund.

2.        I deal first with Mr Le Quesne's application.  Mr Lakeman, for the Plaintiffs, does not contest the submission that his clients should be ordered to pay the costs of the First and Second Defendants on the standard basis.  The issue is whether they should be paid on an indemnity basis.

3.        The head note from the report of Dixon Richardson and Others v Jefferson Seal Limited [1998] JLR 47 encapsulates the legal principle.  In order to make an order for costs on an indemnity basis there has to be a special or unusual feature of the case.  Mr Le Quesne submits that there are several special features of this case. 

4.        Firstly, the actions have been struck out for want of prosecution.  Counsel submits that it is implicit in such cases that indemnity costs should follow.  The Court should send a signal that it will not allow its process to be abused in this way.

5.        Secondly, the length of time involved is substantial.  The first order of justice was tabled 7 years ago. 

6.        Thirdly, notwithstanding the existence of the first action, the Plaintiffs brought a second order of justice based largely on the same facts.  To institute concurrent proceedings in this way was also an abuse of process which should be punished by the award of indemnity costs.

7.        Fourthly, the Plaintiffs had acted in bad faith by agreeing to amend their pleadings as the price of the Defendants' agreement to withdraw an earlier strike out application, but by subsequently failing to take the necessary action.

8.        Fifthly, the Plaintiffs had acted oppressively inter alia by threatening the Defendants with extradition to South Africa when there was no intention to take such action.

9.        On the face of it these are powerful submissions, but they must be set in context.  Mr Lakeman for the Plaintiffs produced a chronology as the basis for his submission that throughout the period 1996 to 2003 there had been active proceedings or negotiations to settle.  The Plaintiffs were licensed insolvency practitioners, who had been appointed as liquidators of the estate of the First and Second Defendants following their departure from South Africa.  Mr Lakeman characterised the First and Second Defendants as fugitives from justice for whom an arrest warrant had been issued in May 1996.

10.      Counsel conceded that the process had been very slow but he produced a letter from the Director of Public Prosecutions in Johannesburg dated 12^th February, 2003, confirming that the papers had been drafted and that on the completion of formalities extradition would be sought.  It does not seem to be disputed that the First and Second Defendants abandoned real property and their trading company in South Africa when they left for Scotland.  Prior to their departure they had made arrangements for the transfer of two substantial sums which found their way into the Tazcalgin Trust. 

11.      Subsequently, the Plaintiffs in their capacity of liquidators have realised the estate in South Africa, and have been trying to recover for the creditors of the First and Second Defendants, the assets which were removed from South Africa.  An agreement was reached between the Plaintiffs and the First and Second Defendants in 1996 that some £500,000.00 should be repaid to the Liquidators, but these proceedings have, of course, continued.  Proceedings have ensued indeed, not only in Jersey, but also in Scotland. 

12.      The allegations of bad faith and oppressiveness levied against the Plaintiffs seem to me to be without any foundation.  It is true that the proceedings have taken far too long.  The chronology of events does, however, seem to me to support the submission of counsel for the Plaintiffs, that there has been no substantial period during which the battle between the parties has not been active.  Viewing the matter in the round there are, in my judgment, no such unusual or special features of the case as to justify the award of indemnity costs.

13.      I, therefore, order the Plaintiffs to pay the costs of the First and Second Defendants on the standard basis.  So far as the costs of the Third and Fourth Defendants are concerned I order that they be paid on an indemnity basis out of the Trust Fund.  I decline to order that the Plaintiffs should reimburse the Trust Fund in respect of those costs. 

Authorities

Dick -v- Narango (6^th April, 1990) Jersey Unreported CofA; [1990] JLR N.2.

Dixon, Richardson & Ors -v- Jefferson Seal Limited [1998] JLT 47.

Takilla Limited & Ors. -v- Green & Ors. (9^th November 1998) Jersey Unreported.

The Bank of America Trust Company Limited (11^th January 1995) Jersey Unreported.

Alsop Wilkinson -v- Neary & Ors (1995) 1 All ER 431.

Grupo Torras -v- Al Sabah & Ors (12^th March 2002) Jersey Unreported; [2002/60].