Howells & Anor v Dominion Insurance Company Ltd

In representative proceedings brought for members of an unincorporated association, the represented members are bound by the judgment even though they did not authorise the litigation individually. Under CPR 19.6, the rule itself supplies the authority for representative proceedings. A judgment may therefore be enforced against represented members with the court’s permission, subject to any special facts particular to an individual member.

That principle does not extend automatically to costs. Represented persons are not ordinarily personally liable for the costs of representative proceedings. Costs against them require the appropriate non-party costs application, normally only in exceptional circumstances.

The defendant insurer appealed from Master Foster’s order setting aside permission to enforce a judgment against named members of the Hemel Hempstead Football and Sports Club, an unincorporated members’ club. The original representative proceedings concerned an insurance policy taken out for the club members. The insurer had succeeded at trial on its counterclaim for repayment of interim insurance payments and had obtained a final costs certificate.

The Master held that the judgment could not be enforced against individual members because there was insufficient evidence that they had authorised the committee to commence or pursue the litigation. He also held that the costs could not be enforced against them under Moon v Atherton. The central issues on appeal were whether individual members were liable for the judgment debt and whether the judgment and costs certificate could be enforced against them.

1. Judgment debt. The appeal was allowed on the enforcement of the judgment. The proceedings were representative proceedings under CPR 19.6 and the former RSC O.15 r.12. The judgment was binding on the represented members, who could not now challenge its merits.
2. The Master had wrongly conflated authority to contract with authority to litigate. The Club Rules authorised the committee to enter the insurance contract. Whether individual members expressly or impliedly authorised the litigation was irrelevant. In representative proceedings, the procedural rule itself supplied the authority for one or more persons to sue or be sued on behalf of all persons with the same interest. The proceedings were the appropriate mechanism for determining liability under the insurance contract.
3. A represented member may resist enforcement on special facts particular to that member, such as lack of membership within the represented class or fraud or collusion in the original action. No such ground had been advanced in this case. The judgment was clear that the insured were the members of the Club, and that the named claimants were liable in their representative capacity rather than in some different personal capacity.
4. The cross-appeal on substantive liability was dismissed. The insurer was enforcing the personal contractual liability of all the members as parties to the insurance contract, not the debt of one member or a debt owed by the Club as a separate legal entity. That distinguished Wise v Perpetual Trustee Co Ltd, Walker v Sur and Hardie and Lane Ltd v Chiltern. The wider rule against automatically excluding debt or damages claims from representative proceedings, stated in Irish Shipping Ltd v Commercial Union Assurance Co Plc, supported the analysis.
5. Costs. The appeal was dismissed on costs. Under Moon v Atherton and Markt & Co Ltd v Knight Steamship Co Ltd, represented persons were not individually liable for the costs of the representative proceedings. CPR 19.6 did not alter that substantive rule. Any attempt to recover costs from individual members required an application for a non-party costs order, and no exceptional basis had been shown.
6. The enforcement issue was remitted to the Master to decide, in the exercise of his discretion, whether permission should be granted against each named member in light of any special circumstances particular to that member.

1. High Court (Queen’s Bench Division): allowed the appeal concerning enforcement of the judgment, dismissed the cross-appeal concerning substantive liability and dismissed the appeal concerning costs. The enforcement issue was remitted to the Master.
2. Queen’s Bench Division, before Master Foster: set aside earlier permission to enforce the judgment and costs certificate against named individual members of the Club.
3. Queen’s Bench Division, deputy judge: on 24 November 1999 gave judgment for the insurer on the claim and counterclaim, ordering payment of £75,740 and costs. No appeal was brought.