David Tyler Moss & Ors v Brian Martin & Anor

A pending foreign appeal can constitute a special circumstance making enforcement of an English judgment based on the foreign judgment inexpedient under CPR 83.7(4)(a). The court should apply by analogy the principles governing a stay pending an English appeal, balancing the risks of injustice to each side. Solid evidence of prejudice is required, including any risk that enforcement will stifle the appeal. The appeal’s merits may be considered where the balance is otherwise uncertain. A stay remains exceptional. Legal expenditure by a company whose assets are frozen may fall within the ordinary and proper course of business, even without a separate legal-expenses exception, provided the court makes no decision on the propriety of the particular payment.

The claimants obtained summary judgment enforcing two Texas judgments against the defendants. The English judgment and consequential November Order required payment of liabilities arising under the 2016 Judgment and the 2022 Judgment. The defendants appealed the 2022 Judgment in Texas and sought a stay of enforcement of the corresponding part of the November Order. They also sought an increase in the permitted legal-expenses cap under a continuing freezing order.

The court was required to determine the jurisdictional basis and governing principles for a stay under CPR 83.7, the significance of the pending Texas appeal, whether enforcement might stifle that appeal, and whether the legal-expenses cap should be increased.

1. Stay application dismissed. The applicable test was whether special circumstances rendered enforcement of the relevant part of the November Order inexpedient under CPR 83.7(4)(a). A pending appeal against the Texas judgment could amount to such a circumstance because it potentially undermined the foundation of the English judgment.
2. The court applied by analogy the principles governing stays pending an English appeal under CPR 52.16. The essential question was whether granting or refusing a stay created a risk of injustice. The court considered the risk of the appeal being stifled, the risk that sums paid could not be recovered if the appeal succeeded, the defendants’ prejudice, the claimants’ delay in enforcement, and the continuing freezing order.
3. The defendants did not provide solid evidence of prejudice. The grounds of appeal had not been articulated sufficiently to permit a meaningful assessment of merit. The evidence did not establish that refusal of a stay would stifle the Texas appeal, including during the period before filing the appeal brief. The possibility of recovery proceedings in the United States was not a matter of substantial weight. The continuing freezing order was a neutral factor because its enforcement-protective purpose remained relevant.
4. The court distinguished Ferdinand Wagner v Laubscher Bros & Co because that case concerned a registered foreign judgment which was not under appeal and a separate cross-claim. The existence of the Texas appeal did not, however, overcome the high threshold for a stay.
5. Legal Expenses Application granted. The cap was increased from £230,000 to £260,000. The increase reasonably reflected the defendants’ continuing need for legal representation and did not constitute a blanket authorisation of expenditure, which remained subject to reasonableness.
6. WMC was not a defendant or respondent in its own right. Its expenditure on legal fees could therefore, in principle, fall within the ordinary and proper course of business under the Angel Bell proviso. The court made no determination about the propriety of any particular payment.
7. The Freezing Order was continued until further order with the revised cap. Applications for interim charging orders and third-party debt orders were left to be pursued in the usual way.

This was a first-instance decision on applications arising after summary judgment in the same proceedings. The judgment records that Mr Philip Marshall KC had granted summary judgment on 4 November 2022, but no citation for that decision is stated.