Flogas Ireland Ltd v North West Gas Company Ltd
| Jurisdiction | Ireland |
| Judge | Mr Justice David Keane |
| Judgment Date | 06 November 2020 |
| Neutral Citation | [2020] IEHC 563 |
| Date | 06 November 2020 |
| Docket Number | [2020 No. 6166P] |
| Court | High Court |
AND
[2020] IEHC 563
David Keane
[2020 No. 6166P]
THE HIGH COURT
CHANCERY
Costs – Interlocutory injunctions – Risk of injustice – Parties seeking costs – Whether the costs could be justly adjudicated upon at the interlocutory stage
Facts: The High Court (Keane J), on 9 October 2020, gave judgment on an application by the plaintiffs, Flogas Ireland Ltd (Flogas) and DCC Energy Ltd (DCC), for a number of interlocutory injunctions against the defendant, North West Gas Company Ltd (North West): [2020] IEHC 503. Keane J invited the parties to seek agreement on any outstanding issues, including the costs of the application, failing which they were to file concise written submissions within 14 days of the delivery of his judgment, which would then be ruled upon remotely unless a further oral hearing was required in the interests of justice. North West sought its costs of the interlocutory application on the basis that it successfully resisted three of the five interlocutory injunctions sought against it by Flogas and DCC. That result, it said, was the event that costs should follow. Flogas and DCC relied on their success both in obtaining one of the injunctions that they sought and in securing the provision by North West of an undertaking to the court equivalent to another as factors that would entitle them to their costs of the application against North West, although they adopted the position that this case falls into the category of interlocutory applications the costs of which cannot be justly adjudicated upon at the interlocutory stage, so that the decision on those costs should be reserved to the trial judge.
Held by Keane J that it may be that the decision he had made on the evidence before him to grant one injunction and refuse others by applying a strong arguable case test would, with the benefit of hindsight at the end of the trial, turn out to have been based on an incomplete or incorrect understanding of the relevant facts or the applicable law, or both. Keane J held that this was not an application that turned as much on the wider balance of justice as on the strictly provisional view that he was required to form about the strength of the various claims advanced by Flogas and DCC. Thus, Keane J judged it to be in the category of cases where a risk of injustice may arise in determining the costs of the interlocutory injunction application at this stage of the litigation.
Keane J held that the costs of the interlocutory injunction application should be reserved to the trial of the action.
Costs reserved.
On Friday, 9 October 2020, I gave judgment on an application by Flogas Ireland Limited (‘Flogas’) and DCC Energy Limited (‘DCC’) for a number of interlocutory injunctions against North West Gas Company Limited (‘North West’). This ruling should be read in conjunction with that judgment, which can be found under the neutral citation [2020] IEHC 503. In accordance with the joint statement made by the Chief Justice and the Presidents of each court jurisdiction on 24 March 2020 on the delivery of judgments during the COVID-19 pandemic, I invited the parties to seek agreement on any outstanding issues, including the costs of the application, failing which they were to file concise written submissions within 14 days of the delivery of my judgment, which would then be ruled upon remotely unless a further oral hearing was required in the interests of justice.
For reasons that have not been explained, although judgment was given on Friday, 9 October, there was no engagement between the parties on the outstanding issues until Wednesday, 21 October, when - through its solicitors - North West emailed Flogas and DCC, inviting them to agree that, on the straightforward application of the usual rule (‘that costs follow the event’), North West was entitled to its costs of the application against them. Although the 14 day period was close to expiry, North West invited a response to that proposal, reserving to itself a right of reply. Through their solicitors, Flogas and DCC replied by email the following day, inviting North West to agree instead to reserve the costs of the application to the trial of the action. Flogas and DCC delivered their statement of claim as an attachment to that email, in which they also set out a timetable of proposed directions on the steps necessary to prepare for trial. Flogas and DCC invited a response to those proposals by 11 a.m. on the following day, Friday, 23 October - the last day of the period allowed for providing written submissions on costs.
Thus, both sides were now setting demanding deadlines for each other, having unaccountably elected to refrain from engagement for the first twelve days of the fourteen day period allowed. To that extent, both sides were then equally remiss, though neither was yet in breach of the court's direction.
On 23 October, within the time permitted, Flogas and DCC filed written submissions on the issues of the costs of the application and the directions necessary to facilitate an expedited trial.
North West did not file any submissions within the period permitted. Instead, it emailed Flogas and DCC again on 23 October, asserting that the deadline they had fixed for a response to their proposal for agreed directions was unreasonable and that, instead, a response would be forthcoming by close on business on the following Tuesday, 27 October. The email went on to note that submissions on costs would be necessary, and that North West would await hearing from Flogas and DCC in that regard.
The email just described discloses a fundamental misunderstanding or misconstruction of the terms of the joint statement of 24 March 2020, whereby the parties are either to agree the precise form of order to be made or to file concise written submissions on the appropriate terms of that order within 14 days of the delivery of the judgment, subject to any other direction given in it. While I do not doubt that a court has a discretion to extend that deadline (if satisfied that, for good reason, it is appropriate to do so), the assertion that one or other party can unilaterally extend it is directly contrary to both the spirit and the letter of the joint statement.
Thus, the appropriate response to any eleventh hour proposal deemed unacceptable is to file written submissions to the court within the time permitted; it is not for a party to arrogate to itself the unilateral power to extend the deadline for reaching agreement or making those submissions. To hold otherwise would undermine the clear and obvious intent behind the joint statement. It would also introduce an element of administrative uncertainty into the finalisation of orders during the COVID-19 pandemic that the court registrars, who are already overburdened in that context, should not have to contend with.
As an exceptional measure and lest any submissions made by North West had been misdirected or overlooked, on 29 October I requested the registrar to enquire whether it intended to file submissions. That inquiry elicited a terse email stating that North West did intend to file submissions and would do so ‘as quickly as possible.’ In the interest of fairness to both sides, I requested the registrar to write again, requiring an explanation for North West's failure to comply with the deadline and inviting it to make whatever submissions it might wish on why it should be permitted to file submissions late.
North West emailed the following day, attaching its written submissions (then one week late) and a letter of explanation. In that letter, North West asserts that it did not receive the written submissions of Flogas and DCC until after close of business on 23 October and, hence, was unable to respond to them within time. That explanation implies that, rather than a reciprocal obligation on each of the opposing parties to make written submissions within 14 days on the appropriate form of final order in default of agreement, there was instead an obligation on Flogas and DCC to furnish North West with its written submissions on that issue within a period it was to agree with North West, after which North West was to be afforded a reasonable period within which to file written submissions in response, subject to apprising the court of its intention to do so. Thus, in that correspondence, North West apologised to the court solely for its failure to apprise the court of that intention.
I can find no basis for any such interpretation of either the joint statement or the direction contained in my judgment of 9 October. For that reason, all other things being equal, I would not have granted North West leave to file those submissions, nor would I have had regard to them for the purpose of the present ruling. However, as an exceptional measure, I will grant that leave and take those submissions into consideration. I propose to do so for two reasons: first, because a period of adjustment to the requirements of the joint statement should perhaps be permitted; and second, because the arguments that North West makes are entirely conventional and were flagged in earlier correspondence between the parties, so that there is no obvious prejudice to Flogas and DCC in taking them into account. To further limit the risk of prejudice, I also propose to take into account what Flogas and DCC describe as their ‘clarification’ of 30 October, directed towards a specific misstatement of fact that they say those submissions contain.
In their email to the registrar of 30 October, North West asserts that a trial preparation timetable has now been agreed between the parties...
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