Leneghan International Transport Ltd v Lombard Ireland Ltd
|Mr Justice Max Barrett
|12 May 2017
| IEHC 298
|2016 No. 10690P
|12 May 2017
 IEHC 298
2016 No. 10690P
THE HIGH COURT
Practice & Procedures – O.26, r.4 of the Rules of the Superior Courts 1986 – Non-payment of costs – Lack of cogent reason – Stay on proceedings
Facts: The first defendant sought a stay on the proceedings filed by the plaintiff vis-a-vis the first defendant. The first defendant asserted that the plaintiff had not paid the first defendant's costs of the proceedings that the plaintiff previously filed and discontinued.
Mr. Justice Max Barrett granted a stay on the proceedings filed by the plaintiff vis-a-vis the first defendant. The Court held that under o.26, r.4 of the Rules of the Superior Courts 1986, the Court had the discretion to grant a stay if the costs imposed on other party in prior discontinued action had not been paid. The Court found that the plaintiff had filed the second action substantially on the same cause of action on which the first discontinued action was based and offered no explanation for the non-payment of costs. The Court noted that the amount of costs imposed was not high and ought to be payable.
This an application made under O. 26, r.4 of the Rules of the Superior Courts 1986, as amended (the "RSC"), seeking a stay on the within proceedings vis-à-vis the first-named defendant until such time as the plaintiff has paid the first-named defendant's costs of the proceedings previously brought and discontinued by the plaintiff.
The within proceedings were issued on 30 th November, 2016, and were served on the first-named defendant under cover of letter dated 8 th December, 2016. The proceedings are identical to a previous set of proceedings brought by the plaintiff against the above-named defendants, save that the previously instituted proceedings (i) featured an additional defendant, and (ii) sought damages for fraudulent misrepresentation, whereas negligent misrepresentation is now contended to have occurred.
As of the date of hearing, no costs of the discontinued action had been paid by the plaintiff to the first-named defendant, despite these having repeatedly been sought without any reply being received from the plaintiff's lawyers, not even a courtesy letter stating, for example, that "We are seeking our client's instructions and will respond in due course".
By notice of motion, the first-named defendant now seeks, inter alia, an order pursuant to O. 26, r.4 of the RSC staying the within proceedings vis-à-vis the first-named defendant until such time as the plaintiff has paid the first-named defendant's cost of the proceedings previously brought and discontinued by the plaintiff herein bearing record number 2016 8231P.
Order 26 of the RSC is headed ' Discontinuance'. Order 26, rule 4 provides as follows:
' If any subsequent action shall be brought before payment of the costs of a discontinued action, for the same, or substantially the same, cause of action, the court may order a stay of such subsequent action, until such costs have been paid.'
The court's power in this regard is clearly a discretionary one: thus the rule provides that '[T] he court may order a stay', not "must" or "shall".
There appear to be no modern Irish authorities concerning O. 26, r.4. The sole case of relevance identified by counsel for the first-named defendant was the long-ago decision of the House of Lords in , an appeal from the then Irish Court of Appeal.
Exchequer Division against the respondents for the same matter and in which (unlike the position here) the previous action had not merely been discontinued but had been dismissed. was a case in which the sole question on appeal was whether an appellant could be allowed to proceed with a pauper's action in the Chancery Division against the respondents without having first paid the costs of a former action brought by him in the
Relying on the then relatively recent decision of the Court of Appeal of England and Wales in , and showing an admirable deference to the exercise of discretion by the court below, the House of Lords concluded that, in Ireland as in England, where a plaintiff, having failed in one action, brings a second action for the same cause of action, the second action must be stayed until the costs in the first have been paid. Though he does not establish it as a pre-requisite to the exercise of the court's discretion, Herschell L.C., at 416, did draw some comfort in that case from the fact that:
'[A] s far as I can see, if the appellant here were allowed to sue he would really gain no advantage by doing so, for from all that I have heard today I have been unable to see that he would be likely to make out any sort of case against the present respondents, or to obtain any benefit from the litigation which he has commenced against them.'
The sole case referred to by the House of...
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