Before : |
T. J. Le Cocq, Esq., Bailiff, sitting alone |
Between |
Guardian Global Capital Suisse SA |
Representor |
And |
Jersey Financial Services Commission |
Respondent |
Advocate P. G. Nicholls for the Representor.
Advocate H. Sharp Q.C. for the Respondent.
judgment
the bailiff:
1. In its Judgment dated the 25th April 2020 (Guardian Global Capital (Suisse) SA v JFSC [2020] JRC 073) ("the Judgment") the Court determined that the Notice as defined therein given by the Jersey Financial Services Commission ("the Commission") to the Representor ("GGC") was valid and should be complied with.
2. The Notice in question had been given on the 18th July 2019 and GGC, after an exchange of correspondence with the Commission, had applied to the Court for declaratory relief as to the validity of the Notice and the obligation of GCC to comply with it. Although the proceedings had started as an application for a declaration, by the time they were dealt with by the Court, they had become an application for judicial review in the normal way.
3. This Court found in favour of the Commission and against the argument put forward by GGC. The Commission accordingly maintains that it should be entitled to its costs of and incidental to the proceedings in the normal way as it is the clear winner.
4. Because, when the matter was first brought before the Court, GGC had indicated that it did not view its application as hostile and was only proceeding because it thought the legal position was unclear and therefore it was prudent to seek clarification from the Court, at the end of the Judgment, the Court reserved the question of costs for further argument.
5. The Commission maintains that it is entitled to its costs and, in support, cites the case of R (Davy) v Alesbury Vale District Council [2008] 1 WLR 878 where the court summarised the underlying principles in the following terms-
".....It does seem to me that the costs should ordinarily follow the event and that it is for the claimant who has lost to show that some different approach should be adopted on the facts of a particular case. That principle is supported by the decision and reasoning of Dyson J in R v Lord Chancellor Ex P Child Property Action Group [1999] 1 WLR 347 at 355H - 356E. That passage concludes as follows:-
"....In considering whether, and in what circumstances, there should be a departure from the basic rule that costs follow the event in public interest challenge cases, in my view it is important to have in mind the rationale for that basic rule, and that it is for the applicants to show why, exceptionally, there should be a departure from it."
The basic rule he refers to is, as he explained at page 356C, the costs follow the event in public law cases, as in others, because, where an unsuccessful claim is brought against a public body, it imposes costs on that body which have to be met out of money diverted from the funds available to fulfil its primary functions."
6. The Commission's case is quite simply that GGC's challenge to its Notice has put it to expense which it would not otherwise have needed to incur and GGC could have complied with the Notice without taking matters to the court. The Commission had applied to the court for an order that the case be treated as one of judicial review and, at least from that point onwards, GGC could not have been in any doubt as to the nature of the proceedings it had chosen to bring. This was essentially a weak legal challenge and the Commission, a public authority, should be protected from it.
7. I do not need to set out the background to this case, or indeed the arguments for and against the validity of the Notice. These are set out in the Judgment.
8. In arguing that costs should be ordered on an each party own costs basis, GGC refers to the dialogue that had taken place between it and the Commission. The correspondence, although raising concerns relating to the validity of the Commission's Notice, expressly says the Commission should not take those concerns as evidence of a reticence on the part of GGC to assist, but must be satisfied that it is not breaching confidentiality. The Commission did not accept GGC's position and maintained that the Notice was valid.
9. It seems to me that irrespective of what confirmation or assurances as to the legal position the Commission might have given to GGC, GGC, having taken the view that the legal position was unclear, would likely have wished to take the matter to the court in any event.
10. As I have mentioned, it was put to the Court that the matter had started as an application akin to what might have been done by a trustee seeking confirmation from the court that it should take a certain course. The difficulty with that analogy, so it seems to me, is that although a trustee might reasonably expect an indemnity from the trust fund in connection with an application for directions or, if the court sanctions the trustee to take adversarial proceedings, from an adverse costs order, that does not protect it in normal terms from an adverse costs order in so far as the other litigating parties are concerned. It simply gives a trustee a right of indemnity.
11. It was clear at an early stage, if not from the outset, that the Commission considered this to be a challenge by way of judicial review. The fact that GGC, for its own protection and guidance, may have wished to achieve legal certainty with regard to the powers of the Commission, does not of itself, so it seems to me, shift the potential burden of costs.
12. On one level this is an entirely straightforward matter. One party, GGC, took one view of the certainty of the position. The other party, the Commission, took a different view but was not able to satisfy GGC that its view was the correct one. The matter was placed before the Court. One party's argument prevailed, one was not successful. If those factors by themselves justified a departure from the normal rule as to the payment of costs, then it might be anticipated that a number of unmeritorious challenges would be made before the Court at no adverse costs risks to the challenger.
13. Although I have some sympathy for the prudent position taken by GGC in this case it does not seem to me to be sufficient to justify a departure from the normal order.
14. In the circumstances, therefore, in my judgment costs should follow the event and GGC should pay the costs of and incidental to the proceedings to be taxed on the normal taxed costs basis if not agreed.
Authorities