Jersey Unreported Judgments

Costs

[2021]JRC226

Royal Court

(Samedi)

2 September 2021

Advocate R. S. Christie for the Plaintiff.

Advocate M. C. Seddon for the Defendants.

Advocate O. J. Passmore for the Parties Cited. 

judgment ON COSTS

the COMMISSIONER:

1.        On 8^th July 2021, I heard submissions as to costs arising out of my judgment of the same date ("the Judgment" - Sakab Saudi Holding Company v Al Jabri [2021] JRC 187) discharging certain disclosure orders made by the Court exercising its Norwich Pharmacal jurisdiction.

2.        The background is set out in the Judgment, but very briefly, the Plaintiff, "Sakab", a Saudi-Arabian company, claims in proceedings brought in Ontario, Canada, that some SAR 13 billion has been misappropriated from it by the defendants in those proceedings which include the defendants in these proceedings ("the Defendants").  Of that sum, it is alleged that some SAR 980 million was allegedly paid to the First Defendant, Dr Al Jabri. 

3.        Dr Al Jabri disclosed in the Ontario proceedings that he had established a trust in Jersey known as the Black Stallion Trust and Sakab brought proceedings here by way of Order of Justice on 10^th May 2021, in which freezing and disclosure orders were made against the Defendants and the Parties Cited.

4.        The Parties Cited have complied with part of the disclosure orders made against them, referred to in the Judgment as "the First Stage Disclosure", but the Defendants objected to the Parties Cited complying with the remaining disclosure orders, referred to as "the Disputed Disclosure", on the grounds that they exceeded the Court's Norwich Pharmacal jurisdiction.  In open correspondence the Defendants said they would not object to the Parties Cited giving information in relation to certain payments made out of the Black Stallion Trust which had been set out in paragraph 87 of Advocate Christie's skeleton argument.

5.        In the event, the Court found in favour of the Defendants and discharged the Disputed Disclosure orders, but the Court made a number of further orders to assist Sakab in tracing funds that had been paid out of the Black Stallion Trust ("the Further Disclosure Orders").

6.        It was agreed that the reasonable costs of the Parties Cited, who took a neutral stance, would be paid by Sakab, and so I am concerned here with costs as between Sakab and the Defendants.

7.        Advocate Seddon, for the Defendants, submitted that the key and only issue in this case was the extent of the Court's Norwich Pharmacal jurisdiction and the relief sought by the Defendants in their summons had been granted in its entirety.  There were no discrete issues and following the principles set out in Watkins v Egglishaw [2002] JLR 1, costs should follow the event.  Furthermore, he submitted that the Defendants should be awarded their costs against Sakab on the indemnity basis.

8.        Advocate Christie, for Sakab, submitted that this had been a split result, which merited either a split costs order or no order at all.  He had made it clear in paragraph 90 of his skeleton argument that Sakab would be content with more specific and targeted orders, and had submitted a draft, from which he estimated that Sakab, through the Further Disclosure Orders, had achieved half of the orders put forward.  He conceded that the Disputed Disclosure was too broad, and Sakab could have been clearer on that, but the Further Disclosure Orders made by the Court exceeded what the Defendants had offered. 

9.        Advocate Christie criticised the Defendants for filing the first affidavit of Christian James Tuddenham on their behalf, which extended with exhibits to 2,542 pages, of which only one page was referred to by the Defendants at the hearing.  Advocate Seddon confirmed, however, that the costs of preparing this affidavit, undertaken by the Defendants' London lawyers, would not form part of the costs claimed in these proceedings.

Decision

10.      In addition to the general principles on the awarding of costs set out in Watkins v Egglishaw and the awarding of indemnity costs set out in Pell Frischmann Engineering Limited v Bow Valley Iran Limited & Others [2007] JLR 479, I was referred to the helpful discussion on issue-based costs orders in the judgment of Sir Michael Birt, Commissioner, in Golovina v Rusal [2020] JRC 099.  In that case, the Court rejected the application of the defendant to stay the proceedings in this jurisdiction on the ground of forum non conveniens.  There were two issues before the Court, firstly, had the defendant discharged the burden of establishing that Russia was another available forum which was clearly or distinctly more appropriate than Jersey and secondly, if so, had the plaintiff discharged the burden of showing by cogent evidence that there was a real risk that they would not obtain justice in Russia if the case proceeded there.  The defendant succeeded on the first issue and the plaintiff on the second issue, leading to the defendant's application to be rejected.  The Court declined to make an issue-based order, but reduced the plaintiff's costs by 30%, to reflect the time and expense incurred as a result of the plaintiff contesting the first issue.

11.      The case before me can be distinguished from that in Golovina.  There was only one issue before the Court, namely the extent of the Court's Norwich Pharmacal jurisdiction and the Defendants succeeded in every part of the relief they sought, pursuant to their summons.  The Further Disclosure Order made by the Court was in essence a new order, made on the basis of information given by the Parties Cited in compliance with their obligations under the First Stage Disclosure and this to assist Sakab in further tracing the monies disclosed as having been paid out of the Black Stallion Trust.

12.      In these circumstances, I agree that costs should follow the event, but I do not find that the threshold for ordering indemnity costs has been reached.  The Disputed Disclosure formed part of an overall order granted by the Court ex parte on 10^th May 2021, and I see nothing unreasonable or out of the ordinary in Sakab, which claims to be a victim of a substantial fraud, seeking to sustain those orders, albeit that it did so unsuccessfully.

13.      Accordingly, I order Sakab to pay the costs of the Defendants of and incidental to their summons of 2^nd June 2021, including the hearing of 8^th July 2021 in so far as it related to the issue of costs, on the standard basis to be taxed if not agreed.

14.      The Defendants seek an interim payment on account of their costs and have produced a schedule applying the Factor A rates and a Factor B uplift of 100%, which gives rise to a total of £134,244. 

15.      Advocate Christie challenged this uplift of 100%, saying that 70% would be more appropriate, and points out that this was a 1-day commercial application in respect of a short summons.

16.      Following Marange Investments (Proprietary) Limited v La Générale des Carrières et des Mines SARL [2013] JRC 119A, I start from the proposition that there should be an interim payment on account, on the basis that the Defendants, as the successful parties, should get their costs as soon as possible.  I have to adopt a rough and ready approach and arrive at a sum that the Defendants will almost certainly receive on taxation on the standard basis.

17.      Taking into account the submissions made by Advocate Christie on the Defendants' schedule of costs and the possibility of duplication in the time claimed for the three main fee earners, I am going to order an interim payment of £25,000 to be paid by Sakab within four weeks of this judgment being handed down.

Authorities

Sakab Saudi Holding Company v Al Jabri [2021] JRC 187. 

Watkins v Egglishaw [2002] JLR 1. 

Pell Frischmann Engineering Limited v Bow Valley Iran Limited & Others [2007] JLR 479. 

Golovina v Rusal [2020] JRC 099. 

Marange Investments (Proprietary) Limited v La Générale des Carrières et des Mines SARL [2013] JRC 119A