Jersey Unreported Judgments

Debt - application by the plaintiff seeking permission to continue action.

[2014]JRC187

Royal Court

(Samedi)

29 September 2014

Before     :		Advocate Matthew John Thompson, Master of the Royal Court, sitting alone.
Between	Hong Kong Foods limited		First Plaintiff
And	Robert Alan Gibbons		Second Plaintiff
And	Robin Hood Curry House Limited		First Defendant
And	Barry Thirkell		Second Defendant

Advocate O. A. Blakeley for the Plaintiffs.

Advocate C. Hall for the Defendants.

judgment

the master:

Introduction

1.        This is an application by Hong Kong Foods Limited and Robert Alan Gibbons ("the plaintiffs") seeking permission to continue their action against Robin Hood Curry House Limited and Barry Thirkell ("the defendants") and asking the Court to exercise its discretion not to strike out the action on the basis that no summons for directions was issued within the time period set down by Rule 6/26(13) of the Royal Court Rules 2004, as amended (the "Rules"). 

2.        Proceedings were issued by the plaintiffs on 24^th December, 2010, when the action was placed on the pending list. 

3.        Between January and March 2011 correspondence took place between the plaintiffs' legal adviser and the defendants' then legal adviser about whether the defendants' then legal adviser could represent the defendant.  This delayed the filing of an answer.  Ultimately, an answer was filed on 31^st March, 2011. 

4.        On 26^th April, 2013, the Deputy Judicial Greffier sent out a circular to all Jersey Advocates, solicitors and litigants in person informing them that the actions listed in the circular were liable to be dismissed unless a summons was issued to show cause why the action should not be struck out.  The present proceedings were included on that list. 

5.        On 2^nd May, 2013, Advocate Blakeley sent a summons for directions to the defendants' then legal adviser informing that a date fix appointment had been made for 28^th May, 2013, to fix a date for Advocate Blakeley's summons for directions.  It appeared that a date was fixed on 28^th May, 2013.  At the time he applied to issue his summons, Advocate Blakeley had not noticed that the proceedings had been included in the Deputy Judicial Greffier's strike out list. 

6.        On 11^th June, 2013 the defendants' then legal adviser informed Advocate Blakeley that it no longer acted for the defendants and instead Advocate Godden of Messrs. Le Gallais & Luce was now acting. 

7.        On 17^th June, 2013, Advocate Godden wrote to Advocate Blakeley confirming that the directions proposed were agreed and a consent order was signed.  In addition to the directions proposed in the plaintiffs' summons, a direction was agreed staying the matter for mediation for 8 weeks. 

8.        The consent order was filed with the court on 18^th June, 2013. 

9.        On 21^st June, 2013, Master Wheeler wrote to Advocate Blakeley as follows:-

"I refer to your letter of 18^th June enclosing a Consent Order in relation to the above action.

Having reviewed the Court File I see that the action was listed in the Circular distributed by the Deputy Judicial Greffier indicating that the Court intended dismissing the action under the powers conferred upon it by the Royal Court Rules 2004.  Despite the terms of the Notice, all that has happened is the issue by you of summons for directions and the subsequent filing of a purported Consent Order in which directions are agreed.

In accordance with the terms of the Notice it is incumbent upon the parties to satisfy me that it is appropriate that the action be allowed to continue.  In the absence of any hearing before me or even any written submissions on the subject there is no basis on which it would be appropriate for me to allow the action to remain.  Before considering your purported Consent Order I therefore require to be convinced that this is the appropriate way to proceed.

I suggest that you either arrange a date for the parties to come before me on this matter or, if it is agreed between you and Advocate Godden, I would be prepared to make my decision on the basis of written submissions received from you both.

I am sending a copy of this letter to Advocate Godden so he is aware of what I have said and I await hearing from you both in due course."

10.      Ultimately, the summons required by Master Wheeler has only come before me now for determination due to the matter being stayed by agreement with Court approval as a result of health issues suffered by the second defendant which it is not necessary to set out in detail.  The effect of these issues meant that the second defendant was unable to give instructions until recently.  I have not therefore taken into account or considered any period after May 2013 in deciding whether or not the action should continue.  

11.      Finally, it is right to note that the defendants are now represented by Advocate Hall of Messrs Viberts.  At present she has only been instructed in relation to the application to continue the action and has not advised the defendants on the merits of the plaintiffs' claim, or the answer and counterclaim because of a potential disagreement with the plaintiffs and Advocate Blakeley as to whether Viberts are prevented from acting due to an alleged conflict of interest. 

Factual background

12.      The plaintiffs' claim arises out of a lease of premises at No.8 Cheapside, St. Helier ("the Premises").  On 2^nd April, 2004, the first plaintiff entered into a 21 year lease of the premises with the owner of the premises, Mrs Moore.  The second plaintiff with another (now released) was guarantor of the first plaintiff's obligations under the lease with Mrs Moore.  The premises were later inherited by Mrs Moore's daughter, Diana Moore ("the landlord").  The head lease was a fully repairing lease.  

13.      On 24^th May, 2005, the first plaintiff sub-let the premises to a company known as "Chinese Whispers Limited whose obligations were guaranteed by a Mr David Moore (no relation of Mrs Moore or the landlord) and a Mr Chan.  The granting of the sub-lease was authorised by Mrs Moore.  The rent payable under the sub-lease was £36,000 per annum.  The rent under the lease was initially £26,000 per annum.  By 2008, the annual rent was £30,000. 

14.      In or about June 2008, the sub tenant got into financial difficulties and discussions commenced between the sub tenant, its guarantors, the plaintiffs and the defendants concerning a possible assignment of the sub-lease to the first defendant. 

15.      Ultimately it was agreed between the sub tenant, the plaintiffs and the defendants that the first defendant would take an assignment to the sub-lease with a guarantee from by the second defendant.  The landlord did not consent to the assignment.  It is in issue between the plaintiffs and the defendants whether the landlord's consent was needed.  The extent of the assignment agreement is also in dispute, including whether obligations would be taken on by the defendants in relation to amounts owed by the sub tenant to the first plaintiff and whether or not consumables were to be left at the premises being taken over by the defendants. 

16.      The plaintiffs allege that around the date of the assignment the defendants commenced certain building works at the premises to undertake to refurbish and upgrade the premises ("the works").  The plaintiffs allege that the works were not completed and the premises were left in a state of disrepair by the defendants. 

17.      This state of repair of the premises led to the landlord commencing proceedings against the plaintiffs which resulted in a judgment of the Royal Court dated 9^th July, 2010, Moore v Hong Kong Foods Limited & Gibbons [2010] JRC 127, given by Commissioner Sir Philip Bailhache.  At paragraph 4 of its judgment, the Royal Court noted that the validity of the assignment between the sub-tenant and the current defendants was in dispute.  The plaintiffs, as defendants in the proceedings brought by the landlord, did not dispute claims for arrears of rent and outstanding insurance premiums.  However, they resisted cancellation of the lease. 

18.      At paragraph 14 of the judgment Sir Philip Bailhache, Commissioner, in ordering cancellation of the lease, stated as follows:-

"While we think that that description is a little hyperbolic, we do agree that the defendant has proved to be a very unsatisfactory tenant.  The difficulties with sub-tenants were of no consequence whatsoever to the plaintiff.  The plaintiff was entitled to receive the agreed rent for the premises.  To refuse to pay the rent due under a lease particularly over an extended period is a very serious breach which goes to the root of a contract for the letting of land.  We can well understand why the plaintiff is unwilling to contemplate remaining in a contractual relationship with the defendant."

19.      The head lease was therefore cancelled. 

20.      The court also gave summary judgment on liability in respect of a failure to repair the premises, remitting to the Judicial Greffier the question of quantum. 

21.      Finally, the judgment at paragraph 20 stated as follows:-

"As a post script we note that the defendant intends, according to his counsel, to seek to convene the sub-tenant or sub-tenants to these proceedings.  Again, without making any finding to that effect, it does appear on the face of it to us, that Robin Hood Curry House Limited and/or the guarantor, Mr Thirkell, are prima facie responsible on a quantum merit basis to contribute towards the costs of the restoration of the premises in relation to the damage they appear to have caused.  Whatever the position may be in regard to the assignment of the sub-lease so far as the plaintiff is concerned, a contract appears to have been made between the parties to the deed of assignment.  We will say no more on that other than to recommend to the parties that differences of this kind might well be resolved more expeditiously and more cheaply at mediation.  That concludes the judgment of the Court."

22.      As a result of this judgment, what is now claimed by the plaintiffs from the defendants in the order of justice before me, is as follows:-

(i)        The plaintiffs' legal costs in defending the landlord's claims;

(ii)       Experts fees incurred by the plaintiffs in defending the landlord's claim;

(iii)      £60,000 representing monies paid to the landlord in settlement of costs awarded in her favour and her claims for repairs;

(iv)      Loss of rent under the sub-lease being the difference between rent payable under the head lease and the agreement payable under the sub-lease for the remainder of the rent in the sum of £6,000 per year.  At the date of termination of the lease, the lease and sub-lease both had a further 15 years to run unless terminated early.  The amount of the claim is therefore put at £90,000. 

The total amount of the plaintiffs claim is therefore in the region of £175,000 plus its costs. 

23.      The defendants dispute any liability to the plaintiffs and in summary argue as follows:-

(i)        The plaintiffs did not have the landlord's permission to assign the sub-lease and therefore no valid assignment was entered into;

(ii)       The premises were in a state of disrepair which was the fault of the plaintiffs.  In particular work carried out to remove a chimney breast on the first floor was defective.  Complaint is also made about a failure to reinforce the floor of the back store room on the first floor of the premises.  More generally the defendants allege that building works carried out at the premises by the plaintiffs were of poor quality and contained numerous defects.  It is also argued that the works carried out by the plaintiffs did not have the required consent from the Minister of Planning and Environment.  

24.      The defendants therefore counterclaim the costs of the works they did carry out and sums paid to the first plaintiff in respect of the assignment of the lease and rent in a sum of £79,000 plus loss of profits, plus costs. 

25.      The difference between the plaintiffs' claim and the defendants counterclaim is therefore in excess of £250,000. 

Legal Principles

26.      There is no real disagreement between the parties of the relevant legal principles on a strike out application for breach of the Rules which briefly are as follows:-

(i)        The power to strike out is contained in Rule 6/26(13) of the Rules which permits the court of its own motion to dismiss an action after giving 28 days' notice in writing to all the parties;

(ii)       On considering whether an action can be dismissed the court considers the following by reference to Lescroel v Le Vesconte [2007] JLR 273:-

(a)       Apart from the failure to issue a summons for directions, has the plaintiff prosecuted its case with at least reasonable diligence;

(b)       Is the failure to apply to issue for a summons for directions within the time frame contemplated, excusable;

(c)       Has the plaintiff satisfied the Master/Court that the balance of justice indicates that the action should be allowed to continue?

27.      Ultimately, the court in Lescroel also noted that the Master had a discretion.  In B v MR [2007] JLR N 48, the Royal Court stated "the decision to dismiss an action without considering the merits should be taken on the basis of all the circumstances.  The three questions should not therefore be considered sequentially with the court only considering the next question if the plaintiff succeeded on the previous one".

28.      It is also clear that the remedy of dismissal must not be disproportionate to the breach involved (see B v MR [2007] JRC 139 at paragraph 26 and Irish Nationwide v The Volaw Corporate Trustee Limited & Ors [2012] JRC 035 at paragraph 27). 

29.      In Vieira v Kordas [2014] JRC 042 although considering a strike out under Rule 6/13 of the Rules, which is a slightly less stringent test, W. J. Bailhache, Deputy Bailiff at paragraph 19 stated as follows:-

"We come now to the question as to what sanction should be applied in the light of the first two findings.  Having regard to the Article 6 Convention rights of the parties, we note and accept the proposition that we should not apply the most severe sanction of striking out the plaintiff's claim if there are other sanctions which could be applied which would enable justice to be done between the parties.  Illustrations of the type of sanctions - costs orders, orders that no interest be due on any sum awarded and so on - are canvassed in some of the other cases.  On the other hand, if the court were to be of the view that it is now no longer possible to have a fair trial of the action, then there would undoubtedly be prejudice to the defendant, and it would not be right to allow the action to proceed." 

I consider it is correct to take the same approach in exercising the discretion vested in me where a beach of Rule 6/26 has occurred. 

30.      In Eckman v Sidem International Limited & Anor [2009] JRC 233, the Royal court considered whether it was appropriate for a defendant to let sleeping dogs lie.  At paragraph 63 Commissioner Clyde-Smith stated:-

" In Hately-v-Morris and others (2004) 1 BCLC 582, a case involving an application to strike out a petition on the grounds that it was an abuse of the process of the Court, Mann J made this comment:-

"I have in mind the passage from Asiansky, set out above, which points out that it is not always appropriate for defendants to let sleeping dogs lie.  This was not a case where the next step in the action was something which it was within the sole province of the petitioner to carry out.  Nor is it a case in which there has been some express order with which the petitioner has failed to comply.  The next step required in this petition after 9 April 2002 was a further CMC.  The respondents could themselves have applied to re-fix the date, even though it might be said that the responsibility lay more naturally with the petitioner because it was his petition.  They did not do so, and did not indicate which counsel was to be instructed in place of counsel had been acting up to that time.  The picture would have been very different if the registrar had been correct in his finding that the petitioner had expressly assumed responsibility for re-fixing, but there is no evidence to support it.""

31.      The Royal Court then went on to say:-

"In our view, similar sentiments now apply in this jurisdiction and in the light of Esteem and the practice direction, it is not always appropriate for defendants to let sleeping dogs lie.  Issuing a summons for directions was not within the sole province of the plaintiff.  The second defendant was in a position to issue such a summons or at least to have formally warned the plaintiff that failure to do so could lead to a summons for dismissal being issued.  Such a warning, unheeded by the plaintiff without good excuse, could assist in tipping the balance of justice towards dismissal being the just and proportionate remedy."

The plaintiffs' arguments

32.      By reference to the above chronology, Advocate Blakeley accepted that there had been a period of inordinate delay between June 2011 and May 2013 when he applied to issue a summons for directions. 

33.      He did, albeit with a degree of reticence, seek to argue that the delay was excusable.  He contended I should take into account the health of the second plaintiff who has suffered clinical depression for a number of years. Advocate Blakeley stated that, having been in a dispute with the landlord leading to the judgment of Sir Philip Bailhache to which I have referred, the second plaintiff found it very difficult to move matters forward.  The second plaintiff at all times was sole owner and director of the first plaintiff.  As a result of the Royal Court's judgment, the plaintiffs were facing claims for costs of repair, legal costs and arrears of rent in excess of £200,000.  While ultimately the second plaintiff was able to settle this sum for a payment of £60,000 in total in 2011, nevertheless the claim by the landlord was stressful and it was difficult for the second plaintiff to cope with further litigation.  Without in any way undermining the challenges depression can pose, I have to observe that it is not clear from the medical evidence filed whether the second plaintiff was receiving treatment for depression in the period with which I am concerned. 

34.      The main thrust of Advocate Blakeley's clear submissions however concerned where the balance of justice lay.  In summary his arguments were as follows:-

(i)        The defendants had agreed to mediation in 2013 and to the action progressing.  No justification had been advanced for the change of heart since then.  To the extent it was suggested that the defendants had received poor legal advice, the court should not be drawn into an enquiry about what advice had been received or its merits.  Rather, the court should simply note that the defendants' initial reaction was to agree to the matter going to trial and to agree to mediate.  The change of position had not been justified. 

(ii)       The defendants had not issued a summons for directions either;

(iii)      The matters was not prescribed and, therefore, were fresh proceedings to be issued now, the defendants would have to deal with them.  There was therefore no real difference between having to deal with fresh proceedings and having to deal with the proceedings that had not progressed for a period of time. 

(iv)      One of the issues between the plaintiffs and the defendants was a matter of law, namely the question of validity of the assignment.  This matter of law could still be argued without any prejudice. 

(v)       In so far as oral evidence was required about what was discussed in relation to the assignment or the condition of the premises, such evidence could be given by the second plaintiff and the second defendant.  Furthermore, there were the records of the specification of works produced by J. S. Carney for the landlord in relation to the premises dated 31^st August, 2010, and the supporting documentation, together with evidence from Ross Gower Engineers who were retained by the defendants in 2009. 

(vi)      In relation to the evidence of Ross Gower, in the course of argument Advocate Blakeley referred to an affidavit of the second defendant sworn on 2^nd March, 2010, which was subsequently provided to me.  At paragraphs 14 to 20 of that affidavit the second defendant refers to evidence of the condition of the premises in assessments by Mr Clarke of Ross Gower of work carried out to the premises. 

35.      Advocate Blakeley further accepted that I had power to impose conditions if the plaintiffs were permitted to continue the action, including payment of costs and disallowing interest.  However, because the defendants were also at fault in not pursuing their counterclaim, it would not be appropriate in this case to order a payment of all costs on an indemnity basis, as occurred in Eckman and that the question of interest being disallowed should be left to the trial court to determine. 

The defendants' arguments

36.      Advocate Hall argued equally clearly as follows:-

(i)        As the court was facing a breach of the Rules this was a stricter test than cases relating to a strike out for want of prosecution;

(ii)       The defendants had received fresh legal advice (without waiving privilege) and were entitled to change their mind and oppose the plaintiffs' application.  They wanted the present summons resolved before considering any issues of mediation.  

(iii)      Delay was not excusable;

(iv)      While Advocate Hall was sympathetic to the second plaintiff's depression, there was no evidence or treatment of depression in the period with which the court was concerned.  Reasons of health in any event have to be exceptional to excuse an inordinate delay;

(v)       The plaintiffs in any event had failed to act to put the case on hold while facing health or any other issues. 

(vi)      The period of delay was very significant.  By reference to Ybanez v BBVA Privanza Bank (Jersey) Limited [2007] JRC 131, the court expected simple cases to be concluded within twelve months and most cases within twenty-four months.  The present plaintiffs had sat on their hands for the period of time in which the court expected matters to be concluded. 

(vii)     The fact that the claim was not prescribed did not matter.  Once an action was commenced the obligation was on the party to get on with it.  In Garfield-Bennett v Phillips 2002/214 in the postscript to his judgment, Birt Deputy Bailiff stated:-

"It is one thing to be slow in bringing an action but nevertheless bring it within a limitation period laid down by law; it is another to start an action at an earlier stage and then so disregard the requirement to progress matters expeditiously as to lead the Court to strike out the action." 

(viii)    In Begg v Raynes [2013] JRC 183A I also stated at paragraph 21:-

"In my judgment once a plaintiff has issued proceedings his duty is to progress those proceedings to trial or a conclusion within the time frames contemplated by the Court's Rules and practice." 

(ix)      In relation to evidence, by reference to an affidavit filed by the second defendant in opposition to this application, the evidence required at trial was oral.  At this stage the second defendant does know how he will find individuals to prove his case.  Those who worked on the site cannot now recall the condition of the premises to the level of detail required. 

(x)       The defendants did not do anything because they formed the view that the plaintiffs had decided not to pursue matters.  They therefore let sleeping dogs lie. 

(xi)      While the defendants have a counterclaim, if the plaintiffs' claim is struck out, the defendants accept their counterclaim should also be struck out.  If, however, the plaintiffs' claims survive, the defendants wish to pursue their counterclaim. 

(xii)     If I was minded to allow the action to continue then the costs of the present application should be paid by the plaintiffs on an indemnity basis. 

(xiii)    Advocate Hall agreed it should be an issue for the Court at a trial to decide whether or not interest should be deducted, if the plaintiffs were successful in their application and at trial. 

Decision

37.      The view I have reached is that the plaintiffs have just persuaded me that the action should be allowed to continue for the reasons set out below.  However, the decision was very close and any further delay coupled with the period of delay that has occurred already is very likely to lead to the action being dismissed.  The plaintiffs moving forward must make every effort to take this matter to trial as soon as reasonably can be achieved.  My reasons for reaching this conclusion are as follows. 

38.      While it was agreed that the delay is inordinate, a period of delay of twenty-three months is not excusable.  A delay of twenty-three months without any stay or without any justification cannot be justified by reference to the timetables the court expects parties to adhere to (see Ybanez).  Such a period points strongly towards dismissal. 

39.      However, I accept by reference to the second plaintiff's depression, that some part of this period is excusable because depression is not an easy condition.  I can appreciate why it would have taken some time for the second plaintiff to decide whether he wished to pursue the litigation given the claims he faced from the landlord.  However, such a delay would be for a period of a few months only.  Absent extremely compelling medical evidence which is not present in this case, the second plaintiff's depression does not justify a delay of twenty-three months.  Even giving the second plaintiff the benefit of the doubt of a period of delay of up to six months, which is generous to the second plaintiff, there is still a period of delay of some seventeen months which cannot be justified. 

40.      This is a substantial claim.  The amount at stake as noted above between the parties is in excess £250,000.  From the plaintiffs' perspective, they are looking to recover £175,000 plus costs and interest.  To deprive the plaintiffs from potentially recovering a significant sum is therefore a factor in the plaintiffs' favour in deciding to allow the action to continue. 

41.      I am not persuaded by the plaintiffs' argument that if proceedings were issued now the defendants would have to meet the case as best they could.  The position is as set out in Garfield-Bennett and Begg v Raynes which requires parties to get on with an action once they have commenced proceedings. 

42.      The witness evidence in this case is a mixture of documentary evidence and oral recollection.  In relation to documentary evidence, firstly, documents relating to the dispute between the landlord and the plaintiffs relating to the condition of the premises can be produced.  Secondly, there is the detailed schedule of condition produced by Mr Carney setting up the repair works required by the landlord.  Thirdly, the defendants also retained their own structural engineer, (Mr Clark of Ross Gower) who, by reference to the second defendant's affidavit sworn in 2010, inspected the premises in 2009.  This inspection covered the condition of the chimney breast, the party wall, the lack of planning consent as well as other issues with the premises.  As a professional I would expect Mr Clark to have records of his observations and it was not suggested otherwise. 

43.      Insofar as oral evidence is required, much of this can also be given by the second plaintiff and the second defendant.  I accept that the second defendant also wishes to call as witnesses, individuals who were actually working at the premises and he faces difficulties in identifying these individuals and whether they remember anything.  However, I consider that the defendants can fairly advance a case about the condition of the premises by reference to the evidence of Mr Clark to which I have referred as well as the second defendant's own recollection and the other documentary evidence referred to above.  I have therefore reached the view that there is sufficient material to enable a fair trial to take place.  Although this is not a case that is solely dependent on documents, there appears to be sufficient documentary evidence available to allow evidence to be put forward about the condition of the premises and who was responsible for it, notwithstanding the passage of time, as well as oral recollection. 

44.      I have also taken into account in exercising my discretion the fact that the defendants let sleeping dogs lie in respect of their counterclaim.  As the court noted in the passage from Eckman I have cited above, the defendants could have issued a summons for directions.  At the very least, the second defendants could have indicated that, if no summons for directions was issued by the plaintiff, then the defendants might apply to strike out the claim.  No such warning was given.  This is also a case where the defendants had made a counterclaim in addition to the defence advanced to the plaintiffs' claim.  The defendants were therefore seeking to recover monies from the plaintiffs as well as denying any liability to the plaintiffs.  In those circumstances the defendants in relation to their counterclaim were in the same position as the plaintiffs in being under an obligation to issue a summons for directions, which obligation they have breached.  The fact that the defendants do not now wish to pursue the counterclaim, if the plaintiffs' claim is struck out, does not excuse or justify the defendants' failure to issue a summons for directions. 

45.      In relation to the effect of the consent order, signed by Advocate Godden on behalf of the defendants in 2013, I accept that the defendants are entitled to change their mind based on receipt of different legal advice (in respect of which privilege was not waived).  It is not for me to review the different advice received.  Moreover, even though the parties had submitted a consent order to the court for approval, such a step does not mean that the court will approve such a consent order.  The approval of a consent order is a judicial act requiring an exercise of the court's judgement and discretion.  In this case Master Wheeler, by his letter of 21^st June, 2013, made it clear that he was not prepared to approve the consent order submitted including the stay in favour of mediation and wanted to be addressed by the parties on the issues that I have now had to determine.  I have not therefore taken the consent order or the defendants' change of position into account in reaching my decision.  

46.      Although I have allowed the plaintiffs (only just) to be able to continue to pursue their claim because of the amount at stake, because a trial can still take place which will not be unfair and because of the failings of both parties to pursue their claim and counterclaim, I do consider that some form of penalty should be imposed on the plaintiffs for not pursuing their claim for at least seventeen months.  Ordinarily, the costs of the application to continue are payable on an indemnity basis as a sanction for a plaintiff failing to abide by an express provision of the Rules and the court's clear statements in terms of progressing actions to trial once proceedings have been commenced. 

47.      In this case in the exercise of discretion vested in me, I consider that the fair order to make is that the plaintiffs should pay the defendants' costs of and occasioned by this application on the standard basis, such costs to be taxed, if not agreed.  This is because the plaintiffs should be penalised for a breach of the rules.  I have not ordered indemnity costs because of the failure by the defendants to pursue their counterclaim without justification.  I consider this failure on the part of the defendants means that it would be unfair for the defendants to benefit from a costs order on an indemnity basis. 

48.      In light of this judgment I direct the parties to present to me directions for approval.  In the absence of agreement, the parties should attend before me as soon as a hearing is available to enable directions to be given. I also encourage the parties to revisit the question of mediation now that I have decided that the action should continue. 

Authorities

Royal Court Rules 2004.

Moore v Hong Kong Foods Limited & Gibbons [2010] JRC 127.

Lescroel v Le Vesconte [2007] JLR 273

B v MR [2007] JLR N 48.

B v MR [2007] JRC 139.

Irish Nationwide v Volaw Corporate Trustee Limited & Ors [2012] JRC 035.

Vieira v Kordas [2014] JRC 042.

Eckman v Sidem International Limited & Anor [2009] JRC 233.

Hately-v-Morris and others (2004) 1 BCLC 582.

Ybanez v BBVA Privanza Bank (Jersey) Limited [2007] JRC 131.

In Garfield-Bennett v Phillips 2002/214.

Begg v Raynes [2013] JRC 183A.