Calvert v William Hill Credit Ltd

In determining costs of a multi-headed interim application, each head should be assessed separately. A change of solicitors, anticipated appeal funding, or matters already known at trial do not justify lifting a stay imposed to prevent an appeal being stifled. Security for costs requires evidence, not suspicion that an appellant is nominal or has hidden assets. A respondent may reasonably seek the identity of funders and give early notice of a possible non-party costs application. That step is ordinarily expected, although the liability of pure funders remains a separate question. Where the respondent succeeds only on disclosure but fails on stay and security, the costs should reflect that outcome.

This was a costs-only hearing during a pending appeal. The High Court, before Briggs J, had found that the respondent owed the appellant a limited duty of care and had breached it, but dismissed the claim on causation grounds. It ordered the appellant to pay 80% of the respondent’s costs and stayed enforcement of a £175,000 payment on account because enforcement might stifle the appeal.

The respondent’s notice sought to lift the stay, obtain security for costs, and require disclosure of the identities of the appellant’s funders. After receiving further evidence, the respondent abandoned the substantive heads of relief. The parties remained unable to agree the costs of that application. The central issue was how its partial success should be characterised and reflected in the costs order.

Application granted in part. Rimer LJ determined only the costs of the respondent’s withdrawn interim application.

1. The application to lift the stay was mistaken. The change of solicitors merely confirmed the appellant’s financial difficulty, which had been the reason for the stay. Any funding for the appeal would not meet accrued liabilities. The alleged hidden assets were based on evidence available at trial, so there was no new material justifying interference with the stay.
2. The application for security for costs also failed. There was no evidence that the appellant was a nominal appellant, and the allegation that assets had been concealed rested on the same material already known to the trial judge. Suspicion alone could not justify security. The abandoned application was therefore treated as a failed claim.
3. The request for disclosure of funders’ identities succeeded. A respondent contemplating a non-party costs application may reasonably seek that information and give early notice to potential funders that they may be targeted. Such early notice is ordinarily expected and is relevant when deciding whether a non-party costs order should be made. The request was not premature.
4. The court observed that pure funders are not ordinarily made liable for costs, although the respondent might investigate whether the funders were truly pure funders.
5. The application was therefore successful on one head and failed on two. The respondent was ordered to pay two-thirds of the appellant’s costs; the appellant was ordered to pay one-third of the respondent’s costs, with an appropriate set-off.

1. High Court of Justice, Chancery Division: Briggs J found a limited duty of care and breach, but dismissed the substantive claim on causation grounds. He ordered payment of 80% of costs and stayed enforcement of £175,000 on account pending the appeal.
2. Court of Appeal (Civil Division): In [2008] EWCA Civ 888, the court dealt only with the costs of the respondent’s interim application. The application was granted in part.