Irving v Penguin Books Ltd & Anor

Where an interim costs payment may cause severe hardship and the judgment debtor appears to lack means, the court may continue a stay pending determination of permission to appeal, subject to safeguards protecting the judgment creditor. The court may require sworn financial disclosure, confidentiality undertakings and arrangements for service of insolvency proceedings. An application for permission to appeal may be listed with the appeal where the preparatory work would substantially overlap. Further evidence on appeal is governed by the overriding objective. The principles in Ladd v Marshall remain relevant, but operate as matters for the court’s discretion rather than inflexible rules.

Gray J, sitting without a jury in the Queen’s Bench Division, gave judgment for Penguin Books Limited and Deborah Lipstadt in defamation proceedings brought by David Irving, holding that the defence of justification had been established. Mr Irving was ordered to pay costs, including £150,000 on account. After permission to appeal was refused by Gray J, Mr Irving renewed his application and sought a stay of the interim costs order.

The Court of Appeal considered whether the stay should continue pending the permission application, how the permission application should be listed, and how any proposed application to adduce further evidence should be managed.

1. Stay of costs order. The application for a stay was allowed. The court considered that enforcement of the £150,000 interim costs payment could cause crushing hardship to Mr Irving, who appeared to be effectively without means, while continuation of the stay would cause comparatively little hardship to Penguin Books. The stay was continued pending the hearing of the application for permission to appeal.

2. The stay was subject to safeguards. Mr Irving was required to swear an affidavit of means and answer specified questions on oath. Penguin Books undertook to keep the information confidential, subject to disclosure to persons with a need to know. Mr Irving’s solicitors undertook to accept service of any statutory demand or bankruptcy petition.

3. Listing. The application for permission to appeal was to be listed with the appeal to follow if permission were granted. The court considered that the appeal concerned fact and detail and that this course would avoid duplication of preparatory work.

4. Further evidence. Any application to adduce further evidence had to be made promptly and in detail, with supporting documents and a skeleton argument. Under the Civil Procedure Rules, the principles stated in Ladd v Marshall remained relevant, but not as rigid rules. They were matters to be considered in exercising the court’s discretion under the overriding objective.

5. Lord Justice Potter agreed with Sedley LJ’s judgment and order. Costs were to be costs in the application for permission to appeal, and counsel were directed to provide an agreed draft minute of order.

• Court of Appeal (Civil Division): The court continued the stay of the interim costs order pending the hearing of the application for permission to appeal, with the appeal to follow if permission were granted.
• Queen’s Bench Division: Gray J gave judgment for Penguin Books Limited and Deborah Lipstadt on the defence of justification and ordered Mr Irving to pay their costs, including £150,000 on account.