Philip Ward v Tower Trade Finance (Ireland) Ltd & Aengus Burns

• Jurisdiction: Ireland
• Judge: Mr. Justice Noonan
• Judgment Date: 24 March 2022
• Neutral Citation: [2022] IECA 70
• Docket Number: Record Number: 2021/97
• Year: 2022
• Court: Court of Appeal (Ireland)

Between/

Philip Ward

Plaintiff/Appellant

and

Tower Trade Finance (Ireland) Limited & Aengus Burns

Defendants/Respondents

[2022] IECA 70

Whelan J.

Noonan J.

Haughton J.

Record Number: 2021/97

High Court Record Number: 2021/849P

THE COURT OF APPEAL

UNAPPROVED

NO REDACTION NEEDED

COSTS JUDGMENT of Mr. Justice Noonan delivered on the 24th day of March, 2022

1 . This judgment is concerned with the issue of costs, the principal judgments dismissing the appeal having been delivered on the 13th January, 2022. Two ex tempore judgments were delivered, by me and by Haughton J., with which each member of the court agreed. The facts of the matter are fully set out in my judgment and a brief recapitulation will suffice for the purposes of this ruling.

2 . The plaintiff's son, Michael Ward, was the beneficial owner of a company called Michael Ward Engineering Limited. Michael Ward and his father, the plaintiff herein, were both directors of that company. The company entered into a financing agreement, called a Trading Agreement, which was to be construed in accordance with the laws of South Africa and subject to the non-exclusive jurisdiction of the High Court of South Africa.

3 . Separately from the Trading Agreement, Michael Ward signed a guarantee with Tower in respect of the company's debts which was subject to Irish law and the jurisdiction of the Irish courts. The company defaulted on its obligations and Michael Ward's personal guarantee was called in. Tower then issued a summary summons against Michael Ward. No proceedings were taken against the company. Michael Ward was at all times advised by solicitor and counsel and ultimately, the proceedings were compromised in a written settlement agreement.

4 . In essence, the agreement provided that Michael Ward would pay a sum of €100,000 to Tower within 12 months and in default, judgment would be entered against him for a larger amount. In order to secure the performance of Michael Ward's obligations, his father, the plaintiff herein, joined in the settlement agreement for the purpose of providing security over certain lands he owned. The plaintiff executed a deed of charge in respect of those lands in favour of Tower together with a guarantee of his son's indebtedness.

5 . The settlement agreement expressly provided that it was to be governed by Irish law and the parties submitted to the exclusive jurisdiction of the Irish courts. Before these documents were executed by the plaintiff, his son's solicitor quite properly advised him that he should seek independent legal advice before executing the documents. The plaintiff did so and a memorandum was attached to the settlement agreement to that effect signed by the plaintiff's personal solicitor.

6 . Again, default occurred in making the agreed payment by Michael Ward, and accordingly Tower appointed the second defendant as receiver over the plaintiff's lands. The receiver arranged for the lands to be sold by public auction on the 17th December, 2020. The plaintiff made an attempt to thwart the auction proceeding by circulating a document purporting to be a plenary summons against not only the defendants but the receiver's employer, solicitors and auctioneers. This document was drafted by an unqualified friend of the plaintiff and is described in the principal judgment herein as “scurrilous and scandalous”.

7 . Three days before the auction, on the 14th December, 2020 the plaintiff consulted with Mr. William Murphy in the office of GN & Co., solicitors, of which the principal is Mr. Geoffrey Nwadike. As confirmed by counsel for the plaintiff in the course of the hearing of the appeal, Mr. Murphy had previously acted in a number of cases before the court as a McKenzie friend to litigants in person. He is now employed as an assistant by Mr. Nwadike.

8 . Mr. Murphy telephoned the defendants' solicitors in relation to the matter when it transpired that they had received the earlier purported and unissued plenary summons. Mr. Nwadike says, in his affidavit sworn in respect to this application, that because of the existence of this document, he declined to accept instructions from the plaintiff on that day.

9 . The auction on the 17th December, 2019 was unsuccessful and a second auction was scheduled to take place on the 25th February, 2021. On the 9th February, 2021, the plaintiff again attended at Mr. Nwadike's office and on this occasion, Mr. Nwadike says he agreed to represent him. Mr. Nwadike arranged for the issuing of a plenary summons on the 10th February, 2021 seeking an injunction restraining the sale and a declaration that the receiver's appointment was null and void on the ostensible grounds that the plaintiff's consent to the charge on his land was procured through misrepresentation and breach of contract.

10 . As subsequently emerged, the alleged misrepresentation and breach of contract by Tower was its failure to inform the plaintiff that a summary summons was wrongfully issued against his son in circumstances where the courts of South Africa, and not Ireland, had jurisdiction. There was also an allegation that Tower had failed to disclose the existence of this jurisdiction clause to the plaintiff, notwithstanding the fact that the plaintiff himself signed the agreement containing it.

11 . An application for an interim injunction was made to the High Court (Reynolds J.) by Mr. Nwadike on Friday 19th February, 2021. In the affidavit grounding the application sworn by the plaintiff, the plaintiff failed to disclose to the court his previous attempt to prevent the earlier auction proceeding. This court in the principal judgment took a serious view of that non-disclosure but considered that no further action was necessary for the reasons set out. In a written judgment delivered on the 12th March, 2021, the High Court (Allen J.) dismissed the application for an interlocutory injunction on the basis that it was unstateable and did not even meet the threshold requirements of raising a fair issue to be tried.

12 . The plaintiff appealed that refusal to this court and, pending the hearing of the full appeal, brought what was in effect a further application for an interlocutory injunction before the directions judge, Costello J. It was again refused on ostensibly the same grounds, i.e. that no fair issue to be tried had been raised. The plaintiff has sought to appeal that decision to the Supreme Court where a determination on his application has not been made because, as this court was informed during the costs hearing, the plaintiff has failed to lodge with the Supreme Court a transcript of the hearing before Costello J.

13 . In my judgment dismissing this appeal, I criticised the affidavits sworn by both the plaintiff and Mr. Nwadike for the reasons set out. I was also critical of the plaintiff and Mr. Nwadike's failure to disclose, initially at least, the facts surrounding the first auction. I described the core argument of the plaintiff that South African law applies and the South African courts have jurisdiction as “simply absurd”. I further described the contention that the settlement agreement was somehow invalid because Michael Ward had grounds to challenge the summary proceedings but did not do so, as “heaping absurdity upon absurdity”—see para. 37.

14 . At para. 43, I said:-

“43. Finally, it only remains for me to say that it is a matter of regret and concern that such patently untenable and misconceived arguments as have been advanced in this case, now for the third time, and possibly a fourth if the Supreme Court grants leave to appeal, have allowed the accumulation of enormous costs, almost certainly well in excess of the value of the property concerned, and thus at an entirely disproportionate level, which all ultimately fall for the account of the plaintiff.”

15 . In his concurring judgment, Haughton J., having agreed with the view I expressed that the plaintiff's arguments were patently untenable and misconceived, went on to say:-

“5. I would go further, and describe them as spurious, being entirely unfounded in law and fact, and entirely without merit.

6. This appeal is frivolous and vexatious and in my view should not have been pursued. It is one that in my view responsible solicitors and counsel would have advised their client should not be pursued.”

16 . Following the delivery of these judgments, an application on behalf of the defendants was made for a wasted costs order against Mr. Nwadike and having regard to the significance of that issue, the court allowed the parties time to provide written submissions to the court. The plaintiff also availed of the opportunity to swear an affidavit in connection with the costs application, as did Mr. Nwadike, and a replying affidavit was sworn by the defendants' solicitor, Mr. Thomas Dowling.

17 . At the costs hearing, Mr. Nwadike, who is a sole practitioner practicing under the title and style of GN & Company, represented himself without the assistance of counsel. He told the court that he commenced practice as a solicitor in 2019 and that a wasted costs order in the terms sought by the defendants would have a devastating impact on his practice.

Legal principles

18 . Order 99, r. 9 of the RSC (formerly O. 99, r. 7) provides:-

“(1) If in any case it appears to the Court that costs have been improperly or without any reasonable cause incurred, or that by reason of any undue delay in proceeding under any judgment or order, or of any misconduct or default of the legal practitioner, any costs properly incurred have nevertheless proved fruitless to the person incurring the same, the Court may –

(a) call on the legal practitioner acting for the person by whom such costs have been so incurred to show cause why such costs should not be disallowed as between the legal practitioner and his client and (if the circumstances of the case require) why the legal practitioner...