Jim Stafford (as Statutory Receiver of Hollioake Ltd ((in Receivership))) v Peter Rice

JurisdictionIreland
JudgeMr. Justice Garrett Simons
Judgment Date26 May 2021
Neutral Citation[2021] IEHC 344
Docket Number2013 No. 13117 P.
Year2021
CourtHigh Court
Between
Jim Stafford (As Statutory Receiver of Hollioake Limited (In Receivership))
Plaintiff
and
Peter Rice
Sheila Rice
Gregory Rice
Angela Rice
Mark Rice
Defendants

[2021] IEHC 344

2013 No. 13117 P.

THE HIGH COURT

Appearances

Joe Jeffers for the Plaintiff instructed by Hayes Solicitors (Dublin)

Roughan Banim, SC and Elizabeth Gormley for the Defendants instructed by O'Hagan Ward & Co

JUDGMENT of Mr. Justice Garrett Simons delivered on 26 May 2021

INTRODUCTION
1

This supplemental judgment addresses (i) the incidence of costs in respect of an application to amend pleadings, and (ii) the question of whether case management directions should be stayed pending a possible appeal to the Court of Appeal. The judgment on the amendment application was delivered on 30 April 2021 and bears the neutral citation [2021] IEHC 235 (“ the principal judgment”).

(1). COSTS
2

In the principal judgment, I offered the provisional view that the Plaintiff should be entitled to recover two-thirds of his costs of the motion to amend. The Plaintiff had been entirely successful in the amendment application. The Defendants' consent to certain amendments came too late to produce any meaningful saving in costs, and the Defendants' objections to the balance of the proposed amendments have been rejected. The costs of both sides were undoubtedly increased as a result of these objections.

3

The proposed discount of one-third had been intended to reflect the fact that the necessity for the amendment application arose out of shortcomings in the initial pleadings, and an application to court would have been necessary even had the Defendants not objected to the proposed amendments.

4

The parties were invited to file short written legal submissions if they wished to contend for a different form of costs order. The Defendants filed submissions on 13 May 2021, and seek to recover all of the costs associated with the amendment application. Reliance is placed on Porterridge Trading Ltd v. First Active plc [2008] IEHC 42 as authority for the proposition that the respondent to an application to amend should normally recover their costs. This is because an application to court would be necessary even in the absence of any opposition. This is subject to an exception where a party makes unreasonable objection to an amendment which necessitates a separate, significant hearing with its own attendant additional costs.

5

It is submitted that the fact that the Defendants objected to some of the amendments sought did not significantly increase the costs incurred and did not result in a significant, separate hearing. Attention is drawn to the fact that the hearing finished within half a day, and that no written legal submissions were filed.

6

It is further submitted that the delay between the issuance of the motion and the ultimate hearing are attributable to the conduct of the Plaintiff. Attention is drawn to the fact that the draft amendments went through three iterations, and that the motion had been issued prior to the reconstitution of the proceedings to take account of the death of one of the defendants, and the ultimate settlement of the proceedings as against his estate and trustee in bankruptcy.

7

The Plaintiffs delivered written submissions in reply on 14 May 2021. It is submitted that significant costs were incurred by the Defendants' decision to oppose the amendment application. Reliance is placed on the judgment of the High Court (Allen J.) in Care Prime Holdings FC Ltd v. Howth Estate Company (No. 2) [2020] IEHC 329 (“ Care Prime Holdings”).

8

For the reasons which follow, I have concluded that the appropriate order is that the Plaintiff should recover two-thirds of the costs of the amendment application as against the Defendants.

9

The modern approach to costs is to consider the conduct of proceedings to ascertain whether it has led to additional and unnecessary costs being incurred. This approach is illustrated by the following passage from Farrell v. Governor and Company of Bank of Ireland [2012] IESC 42; [2013] 2 I.L.R.M. 183 (cited with approval in Care Prime Holdings).

“Furthermore the courts have become more prepared, in recent times, not least because of changes in the Rules of Court, to look at individual elements of the conduct of proceedings to ascertain whether parties have acted in such a way as has, irrespective of the ultimate outcome of the case, led to additional and unnecessary costs being incurred. Apart from the undoubted justice of that approach same has the added advantage of discouraging parties from bringing unnecessary and unmeritorious applications, resisting appropriate applications or adding unnecessarily and inappropriately to the complexity (and thus the cost) of proceedings by adding a multiplicity of claims or a multiplicity of defences.”

10

This approach is now given statutory expression in the provisions of Part 11 of the Legal Services Regulation Act 2015 (“ LSRA 2015”). The principal determinant of costs is success in the proceedings. This applies also to success in interlocutory applications, save where it is not possible justly to adjudicate upon liability for costs on the basis of the interlocutory application: see Order 99, rule 2(3) of the Rules of the Superior Courts.

11

The court does, of course, have discretion to depart from the default position. The factors to which the court is to have regard in the exercise of its discretion are to be found at section 169 of the LSRA 2015. The principal considerations are the particular nature and circumstances of the case, and the conduct of the proceedings by the parties. Relevantly, the court is to have regard inter alia to whether it was reasonable for a party to raise, pursue or contest one or more issues in the proceedings.

12

It should be explained that the concept of reasonableness in this context means more than simply that the party pursued an issue in good faith ( MV Lady Madga [2021] IECA 51). Something more is required. It might, for example, have been reasonable for a party to pursue an issue in circumstances where the law on the point had not been clear. It will also be relevant to consider whether the pursuit of the issue on which the party was unsuccessful had any meaningful effect on the length of the hearing or entailed the parties incurring additional costs.

13

I turn now to apply these principles to...

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