Amin & Anor v Amin & Ors

An interim payment may be ordered after an account has been directed only where the evidence shows that the account is bound to result in payment to the applicant. A substantial possibility of recovery is insufficient.

The court has jurisdiction to stay an order for payment on account of costs under CPR 3.1(2)(f). In exercising that discretion, it may consider the applicant’s inability to pay, the assets from which payment may become available, the progress and likely outcome of an accounting process, hardship, proportionality and any material change in circumstances. A stay may be granted for a limited period and varied as circumstances develop.

The claimants sought an interim payment from amounts expected to become due following an order for an account of rents and profits concerning jointly held properties. They also sought, alternatively, a stay of an existing order requiring payment on account of costs.

The evidence disclosed substantial disputes about rents, outgoings, mortgage interest and accounting entries. The claimants lacked the resources to satisfy the costs order, while the properties appeared to contain substantial equity. The issues were whether the account was bound to result in payment and whether a stay should be granted.

1. The application for an interim payment was refused. CPR 25.7(b), read with paragraph 2A of Practice Direction 25B, requires evidence showing that the account is bound to result in payment to the applicant. The material showed only disputed inferences about the likely balance. The court could not say that the claimant would receive any payment, although it did not conclude that the claimant would receive nothing.
2. The court had power to stay the costs order under CPR 3.1(2)(f). The fact that the matters relied on could have been raised when the payment-on-account order was made was relevant to the exercise of discretion. So too was any material change in circumstances, by analogy with RSC Order 45 r 11.
3. A limited stay was appropriate. The claimants’ inability to pay, the risk of further hardship or bankruptcy, the substantial equity in the jointly held properties, the prospect of a significant accounting payment and the progress of the account justified temporary protection. The stay was not conditional on immediate payment of rent shares, since that would add hardship, tax complications and disproportionate expense.
4. The stay was granted pending the outcome of the account under the April order. The parties were at liberty to apply to vary its duration or terms. No payment on account of costs was ordered in favour of the minor partners because the evidence did not establish the costs incurred or the relevant proportion attributable to the period in question.