Jordan & Anor v Geason (No. 2)

An interim payment may be ordered after a claimant obtains judgment for a sum to be assessed, provided the payment is just and does not exceed a reasonable proportion of the likely final judgment. The court may consider the claimant’s ability to repay and the defendant’s financial position, but those factors do not automatically reduce the payment. The claimant need not show a special need for the money or explain how it will be used. The assessment requires a realistic allowance for uncertainties in the evidence, including valuation disputes. Where the defendant’s financial evidence is unreliable and there is no specific evidence that repayment would be impossible, the court may give limited weight to the defendant’s asserted inability to repay.

The claimants obtained judgment in default against the defendant under CPR 12 in proceedings concerning refurbishment works at their property. They applied under CPR 25 for an interim payment. The pleaded claim included alleged overpayment, delay-related rent, professional fees and garden furniture, but the application was expressly limited to an alleged overpayment of £544,310.48.

The defendant did not appear and provided no evidence in opposition. The court had to decide whether the conditions for an interim payment were satisfied and, if so, what sum represented a reasonable proportion of the likely final judgment.

1. Order for interim payment. The default judgment was valid and satisfied the condition in CPR 25.7(1)(b). The claimants were therefore entitled to an interim payment in principle.
2. Applicable discretion. Under CPR 25.7(4), the payment had to be just in all the circumstances and no more than a reasonable proportion of the likely final judgment. Relevant considerations included the claimant’s ability to repay, the defendant’s financial position, and the principles identified in Ultraframe (UK) Limited v Eurocell Building Plastics Limited [2005] EWHC 2111 (Ch), British Commonwealth Holdings Plc v Quadrex Holdings Inc [1989] 3 All ER 492 (CA), Stringman v McArdle [1994] 1 WLR 1653 and Campbell v Mylchreest [1998] PIQR P20. A claimant need not establish a special need for a particular sum, and the court need not investigate the proposed use of the payment.
3. Assessment. The court treated £988,000 as the established amount paid. It discounted the surveyor’s valuation evidence to reflect the absence of supporting valuation data and the likelihood of dispute at trial. A value of £525,000 was adopted for interim purposes, producing a provisional overpayment of £463,000. The claimants’ substantial assets gave no reason to reduce that sum.
4. Defendant’s finances. The defendant’s evidence about his assets was unreliable, and he supplied no up-to-date evidence showing that a lower order would be repayable whereas the proposed order would not. His financial position therefore did not justify reducing the payment. His conduct was also relevant to the exercise of the court’s discretion.
5. Disposition. The defendant was ordered to pay the claimants £463,000 within 14 days, by 4pm on 15 October 2007.