Canady v Elektromedizin GmbH & Ors

An appellate court has jurisdiction to strike out an appeal for non-compliance with an interim order for payment on account of costs where the procedural rules confer that jurisdiction. The respondent must establish a compelling case. That threshold may be met by substantial unpaid costs, apparent ability to pay, failure to explain the default despite requests, failure to communicate, and failure to provide a required address for service. Where those matters make the case compelling, the court may strike out the appeal immediately rather than allow a further conditional period for payment.

The claimant appealed against Pumfrey J’s decision in the Patents Court that his patent infringement action had failed. The judge dismissed the action, granted a declaration of non-infringement and ordered the claimant to pay the defendants’ costs. He later ordered substantial payments on account of costs, payable by instalments.

The claimant’s solicitors subsequently came off the record. The instalments remained unpaid, the claimant gave no explanation or communication to the respondents, and he had not provided a United Kingdom address for service. The respondents applied for the appeal to be struck out immediately or, alternatively, after a further 21 days. The central issues were whether the court had jurisdiction to make the order and whether the respondents had shown a compelling case for immediate strike-out.

The Court of Appeal held that the appeal should be struck out immediately.

1. The court had jurisdiction to make the orders sought. It relied on Hammond Suddard Solicitors v Agrichem International Holdings Ltd, [2001] EWCA Civ 2065, where the relevant rules and the existence of that jurisdiction had been considered.
2. The respondents were required to show a compelling case before an appeal could be struck out.
3. That threshold was satisfied. The claimant had failed to pay the interim costs orders, despite the expiry of the instalment dates and written requests for an explanation. He appeared to have the means to pay, had a business and was conducting other litigation. He had not communicated with the respondents and had not provided a proper United Kingdom address for service.
4. In those circumstances, the court considered that immediate strike-out was appropriate. It was unnecessary to grant a further 21-day period conditional on payment.

• Court of Appeal (Civil Division): On 11 July 2006, held that the appeal should be struck out immediately on the respondents’ applications.
• Patents Court, Queen’s Bench Division: Pumfrey J held that there was no infringement, dismissed the action, granted a declaration of non-infringement and ordered the claimant to pay the costs. The decision is reported at [2005] EWHC 2946 (Pat).