Holyoake & Anor v Candy & Ors

Withdrawal of an interlocutory application does not give the applicant an unrestricted right to bring the same application again. A renewed application may proceed where the applicant later obtains material facts that could not reasonably have been discovered in time for the first hearing. A reservation of rights in correspondence is not, without clear agreement, such a right.

For security for costs, a co-claimant’s assets may be relevant only if they are likely to be available to satisfy a costs order within the ordinary payment period. Substantial but illiquid, encumbered or uncertain assets may not make that claimant a good mark. Where a company claimant cannot meet the defendant’s likely costs and available ATE insurance is insufficient, security may properly be ordered.

The defendants sought security for costs under CPR 25.13(2)(c) against Hotblack Holdings Limited, a company claimant in a claim for damages exceeding £132 million. An earlier security application had been withdrawn by consent after evidence suggested that Mr Holyoake had substantial interests in a seafood business and had obtained ATE insurance.

The defendants renewed the application after obtaining evidence casting doubt on the value, ownership and availability of those assets. The claimants argued that the renewed application was an abuse of process, that Mr Holyoake was jointly liable for costs and was a good mark, and that the ATE policy was adequate. The issues were whether the second application could proceed, whether Mr Holyoake’s assets answered it, and what security should be ordered.

1. Renewed application. The consent order disposed of the first application. The defendants’ reservation of rights did not amount to an agreement that they could make a fresh application on any grounds without showing good reason. Butt v Butt was distinguishable because the undertaking there was understood to be provisional and the matter remained capable of further consideration.
2. A second interlocutory application may proceed where the applicant has become aware of facts which could not reasonably have been known or discovered in time for the first encounter. The later evidence materially changed the picture presented about the seafood business, including the amount received, the beneficial ownership of shares and the payment due to the other shareholder. It was therefore not an abuse to reopen the question.
3. Good mark. The relevant question was whether Mr Holyoake could pay the likely costs promptly, ordinarily within 14 or 28 days. His property interests were uncertain in value, subject to substantial borrowing and difficult to realise. His shareholding and sale proceeds were also of uncertain availability and liquidity. They did not establish that he was a good mark.
4. The existence of a co-claimant against whom security cannot be ordered is not a bar to security. It is a discretionary factor. The ATE policy provided security of £4 million, but the likely recoverable costs were assessed broadly at £5.5 million, including irrecoverable VAT.
5. Security was ordered against Hotblack in the sum of £5.5 million, with the ATE policy standing for £4 million. The court was to hear submissions on the method and timing for providing the balance if the parties could not agree.