Grenda Investments Ltd v Barton

Costs following unsuccessful applications are determined by the court’s discretion, having regard to the nature and continuing relevance of the issues raised. The usual approach is that the unsuccessful applicant pays the costs of a strike-out application where the abuse argument has finally run its course. A different order may be appropriate for an unsuccessful summary judgment application where the issues will be determined at trial. In that situation, costs may be ordered to be the applicant’s costs in the case, so that recovery depends on the eventual outcome.

The court determined the costs consequences of two unsuccessful applications in proceedings between Grenda Investments Ltd and Philip Barton.

Mr Barton had applied to strike out the proceedings as an abuse of process, relying on an alleged inference from inactivity. Grenda had applied for summary judgment in relation to alleged agreements, including a non-pursuit agreement and an agreement concerning set-off. The applications had been unsuccessful, and the court considered the appropriate costs orders.

1. Mr Barton was ordered to pay Grenda’s costs of the strike-out application. The application depended exclusively on an invitation to infer that Grenda and Mr Ruhan had decided not to pursue the proceedings. That inference had been rejected. Although the underlying factual territory might be explored at trial in relation to the alleged non-pursuit agreement, the abuse argument itself would not be revisited. It had therefore run its course, making the ordinary order appropriate.

2. As to the summary judgment application, Grenda was awarded its costs up to the end of June 2017. The court considered that the application had been reasonably made when it was issued because the alleged oral set-off agreement had been insufficiently particularised. The material clarification was not provided until Mr Barton’s third witness statement in mid-June 2017.

3. For the costs incurred after the end of June 2017, the court declined to split the costs between the non-pursuit agreement and set-off issues. The principal focus had been the alleged set-off agreement, while the issues raised by the application would be determined at trial.

4. The remaining costs were ordered to be the Defendant’s costs in the case. This meant that Mr Barton would recover those costs if he ultimately succeeded in his defences, but would recover neither them nor Grenda’s costs if he failed. The court distinguished this from the strike-out application because the summary judgment issues remained live for trial, whereas the abuse issue did not.