Glaxo Group Ltd v Rowex Ltd

JurisdictionIreland
JudgeMr Justice Max Barrett
Judgment Date16 July 2015
Neutral Citation[2015] IEHC 467
Docket Number[2015 No. 2537 P],[2015 No. 2537P]
CourtHigh Court
Date16 July 2015
BETWEEN:
GLAXO GROUP LIMITED
AND
GLAXOSMITHKLINE (IRELAND) LIMITED
T/A
ALLEN & HANBURYS
PLAINTIFFS
AND
ROWEX LIMITED
DEFENDANT

[2015] IEHC 467

Barrett J.

[2015 No. 2537P]

THE HIGH COURT

Intellectual Property Rights – Practice & Procedures – O. 99, r. 1 of the Rules of the Superior Courts – Award of costs – Interlocutory application

Facts: The defendant sought an order for costs in relation to the failed application of the first named plaintiff for an interlocutory injunction.

Mr. Justice Max Barrett reserved the order for costs. The Court cited the decision in Veolia Water UK plc v. Fingal County Council [2007] 2 I.R. 81. with approval that while dealing with an interlocutory application in a complex matter, the Court must exercise its discretion cautiously because it would be difficult to identify an event and winning party in such cases for a different picture might emerge at trial thereby causing injustice to either party. The Court found that it would be absurd to award costs at the interlocutory stage because if the first named plaintiff were to succeed at the full hearing, it would make a mockery of the process of law. The Court held that it would not be plausible to adjudicate the liability of costs at the stage and the costs should be reserved to the trial judge on the basis that the determination of substantive action would produce an event.

JUDGMENT of Mr Justice Max Barrett delivered on 16th July, 2015.
PART I
BACKGROUND
1

This is the third judgment that the court has given in the within matter in as many months. This time its judgment is concerned with whether or not to award to Rowex the costs of Glaxo's failed application for an interlocutory injunction.

2

It is always tempting to decide a costs application on-the-spot. However, as this Court indicated at hearing, its sense is that parties hazard and spend a lot of money coming to the Commercial Court and are entitled to a considered, reasoned decision even as to costs, in fact perhaps especially as to costs. This observation seems to apply with even greater truth when it comes to the somewhat tortured issue of whether or not to order costs following an application for interlocutory relief.

PART II
ORDER 99
3

As with any application for costs, the starting point is O.99, r.1. This provides that 'The costs of and incidental to every proceeding in the Superior Courts shall be in the discretion of those courts respectively.' So the court broaches the issue of costs armed with a discretion as to whether and on what basis to make an order as to costs. In the within application, the court is particularly concerned with O.99, r.1(4A). This provides that 'The High Court...upon determining any interlocutory application shall make an award of costs save where it is not possible justly to adjudicate upon liability for costs on the basis of the interlocutory application.' Notably, and the court considers it noteworthy, r.1(4A) addresses interlocutory applications en masse, not just applications for interlocutory injunctions. Therein lies the basis for some qualification and distinction, as will become apparent in the consideration of case-law that follows.

PART III
CASES CITED
i. Haughey v. Synnott
4

Rowex relied largely in its application on the decision of Laffoy J. in Haughey. That was a case that arose out of a dispute between two solicitors who had formerly been in practice with one another, and in which the plaintiff had been successful in an application for interlocutory relief.

5

In her judgment, Laffoy J. noted, at para.4, the following observation in Delany H. and D. McGrath, Civil Procedure in the Superior Courts (3rd edition, 2012):

'It is clear from the use of the word "shall" in rule 1(4A) that the effect of the rule is that a court is required to adjudicate upon and make a costs order in respect of an interlocutory application rather than to reserve the costs of the application. However, the court retains a wide discretion in deciding what costs order to make in respect of the application and the options available include making an order awarding all or part of the costs to one party, making no order as to costs or making the costs of the application costs in the cause. It is only permissible to reserve costs, thereby deferring an adjudication upon the entitlement to costs, where it is not possible, at that juncture, justly to adjudicate upon the costs of the application.'

6

Laffoy J. proceeds, at para.4 of her judgment to refer to the judgment of Clarke J. in Veolia Water UK plc v. Fingal County Council [2007] 2 I.R. 81, and, in particular, Clarke J.'s suggestion that the courts should be prepared to deal with the costs of contested interlocutory applications as a discrete "event". Laffoy J. also refers favourably to the summary, at para.23-46 of the above-mentioned textbook, of the important factors which should inform the court's decision-making when dealing with an application for costs of an interlocutory application:

'Important factors in determining how to deal with the costs of an interlocutory application will include whether an application was required to be brought in any event, the success, or degree of success of a party on the application, whether the party bringing the application gave the opposing party an adequate opportunity to deal with the subject matter of the motion prior to its issue and whether the opposing party acted reasonably in refusing to deal with the particular matter on a consensual basis.'

7

Laffoy J. also makes her own observations about the prospect of a court being in a position to make an award of costs in relation to an application for interlocutory injunctive relief, stating, at para.5 of her judgment:

'The prospect of a court being in a position to make an award of costs in relation to an application for interlocutory injunctive relief after the determination of the application is less likely than in the case of other forms of interlocutory applications, for example, interlocutory applications dealing with procedural matters. [1] That is because, in the case of an application for interlocutory injunctive relief, it is frequently "not possible justly to adjudicate upon liability for costs" at that juncture, so that the case comes within the saver in rule 1(4A). The features of an application for interlocutory injunctive relief which give rise to this distinction were analysed in Civil Procedure in the Superior Courts (at para. 23–49) by reference to the decision of Clarke J. in Allied Irish Banks Plc v. Diamond (High Court, 7th November, 2011) where it is stated:

"[Clarke J.] went on to draw a distinction between cases where the decision on an interlocutory injunction application turns on issues relating to the merits of the proceedings such that a different picture may emerge at the trial and cases where the application turns on matters such as adequacy of damages or balance of convenience which will not be addressed again at the trial. In the former category of cases, a risk of injustice may arise in determining costs at the stage of the interlocutory injunction application whereas the same risk may not arise where the application does not turn on the merits of the proceedings."'

[1] In this regard, it appears that Laffoy J. is referring to matters such as particulars for discovery and so on.

ii. O'Dea v. Dublin City Council
8

The decision in O'Dea is considered by Laffoy J. in Tekenable (considered hereafter). However, the court considers it beneficial to consider O'Dea separately and in sequence. The decision that fell to be made in that case was what, if any, order for costs should be made in circumstances where an application for an injunction was part-heard, adjourned and then abandoned because of some form of settlement between the parties. Thus it was in effect a case in which there was no "event", in the sense that there was no determination by the court; consequently Laffoy J. decided that the court had no function in relation to liability for costs. The key part of Laffoy J.'s judgment, so far as the present application is concerned appears at paras. 6.5 et seq:

'A large variety of interlocutory applications come within the ambit of rule 1(4A). Most, by their nature are susceptible to a determination as to where liability for costs should lie, without giving rise to concern that an injustice or an unfairness may be perpetrated. In my view, an application for an interlocutory injunction is not in that category, as is illustrated by the course which was usually adopted in relation to the costs of an interlocutory injunction prior to the coming into operation of rule 1(4A)- that the costs were reserved for the trial Judge to determine at the conclusion of the substantive hearing. The rationale underlying that approach was explained by Keane J., as he then was, in Dubcap Ltd. v. Microchip Ltd. (Unreported, Supreme Court, 9th December, 1997), as follows:

"It is right to say, of course, that while there is no rule of court or even a practice to that effect, the normal procedure on the hearing of an interlocutory application is to reserve the costs to the trial judge. The reason for that is obvious: there may and frequently will be matters which can only be resolved by the Court of Trial on oral evidence at a plenary hearing of the action and indeed matters may come to light by way of discovery or by way of new evidence not available to the parties at the time of the hearing of an interlocutory application which will bring about a result which seemed unlikely or improbable at the time of the hearing of the interlocutory application, so for that reason it is quite normal on the hearing of the interlocutory applications to reserve the costs."

6.6 The factors outlined in that passage, which informed the "normal procedure" prior to the coming into...

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1 firm's commentaries
  • Costs And Interlocutory Injunction Applications
    • Ireland
    • Mondaq Ireland
    • 21 September 2015
    ...it prevails at the interlocutory stage it will secure an order for costs in its favour. Footnotes 1 Glaxo Group Limited v Rowex Limited [2015] IEHC 467. 2 [2012] IEHC 3 Third edition 2012, Paragraphs 23 to 43. 4 Ibid, Paragraphs 23 to 46. 5 [2012] IEHC 403, Paragraph 5. 6 Unreported High Co......

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