Horler v Rubin & Ors (Rev1)

A successful party is ordinarily entitled to have costs determined promptly, even where the unsuccessful party proposes a further application in related proceedings. A possible future application does not ordinarily justify deferring costs or granting a general stay. For a money judgment, Michael Wilson & Partners Ltd v Sinclair (no. 2) [2017] 1 WLR 3069 establishes that CPR rule 83.7 governs applications to stay enforcement, including applications made before execution and applications intended to prevent bankruptcy proceedings. The applicant must establish special circumstances making enforcement inexpedient or an inability to pay. A lower court may allow only a short extension to enable an application to be made to the Court of Appeal where that court is the proper forum for the substantive stay application.

The claimant had brought proceedings alleging that an earlier finding concerning a proxy to vote at a creditors’ meeting had been obtained by fraud. The claim was dismissed after trial. At the consequential hearing, the defendants sought their costs and a payment on account. The claimant sought to defer the costs decision or stay enforcement pending a proposed application to the Court of Appeal under CPR rule 52.30 concerning the earlier proceedings.

The court therefore considered whether costs should be deferred, whether the claimant should bear all the defendants’ costs, whether a payment on account should be ordered, and whether enforcement should be stayed under CPR rules 83.7 and 3.1(2)(f).

1. Costs. The defendants had succeeded and were entitled to have their costs determined immediately, subject to detailed assessment on the standard basis. The possibility that a future application to the Court of Appeal might succeed did not justify postponing the costs decision. If circumstances later changed, an application might be made under CPR rule 3.1(7), but its success would remain open.

2. The claimant was ordered to pay the defendants’ costs from the beginning of the proceedings. Alleged delay in disclosure of notes did not justify depriving the defendants of costs. The notes were not determinative, there was no deliberate tactical withholding, and earlier disclosure would not have altered the claimant’s conduct. The relevant question was how the party in question would actually have behaved, not how a reasonable lawyer would have advised that party.

3. A general liberty to apply provision was refused. Kavan v Crawford (1877) 6 Ch D 29 and Pawley v Pawley [1905] 1 Ch 593 concerned final orders requiring further working out by later orders. They did not establish that a final costs order should contain liberty to apply for variation following further litigation in a related action.

4. Stay of execution. The court applied Michael Wilson & Partners Ltd v Sinclair (no. 2) [2017] 1 WLR 3069. For a money judgment, CPR rule 83.7 is the governing provision and applies both before and after execution, including where the proposed enforcement is by bankruptcy proceedings. A stay therefore required proof either of special circumstances making enforcement inexpedient or of inability to pay.

5. The proposed Court of Appeal application was not, without more, a special circumstance. The claimant had not provided the evidence required by CPR rule 83.7(6), and the Court of Appeal alone was the proper court to determine the merits of the proposed application and any related stay. The court accordingly extended time for payment of £120,000 for a short period, but dismissed the stay application except to that limited extent.

The judgment itself records that:

• Earlier proceedings: His Honour Judge Raynor Q.C. had found that the claimant gave a proxy to vote at a creditors’ meeting.
• Current proceedings: The claimant’s fraud claim was dismissed after trial. The present judgment determined consequential costs and stay applications.
• Court of Appeal: Permission to appeal was refused at the handing-down hearing. No renewed application under CPR rule 52.30 had yet been made.