Celestial Aviation Trading Ireland Limited & Ors v Volga-Dnper Logistics B.V.

Where costs are payable following dismissal of an application, the court may consider the appropriate form of costs order afresh. A party’s sanctions-related concerns do not justify postponing payment where the court is not satisfied that payment would create a real risk of breach. The usual order may therefore require payment of summarily assessed costs within a specified period. The court may take account of an assurance that the receiving party will not pursue contempt proceedings for non-payment.

The claimants sought payment of their costs following dismissal of the defendant’s variation application. The defendant accepted in principle that it should pay costs but challenged the amount and sought an order postponing payment until it obtained an Office of Financial Sanctions Implementation licence or ceased to be subject to sanctions restrictions.

The claimants accepted that their costs should be assessed at 55 per cent of the sum claimed and gave an assurance that they would not pursue the defendant for contempt if payment was not made. The issues were the proper amount of costs and whether payment should be postponed.

1. Assessment of costs. The parties agreed that the claimants’ costs should be assessed at £134,484.96. The court summarily assessed the costs in that amount.
2. Form of order. The court accepted that it was entitled to consider the appropriate form of order afresh. That did not require postponement of the defendant’s obligation to pay.
3. The court relied on its earlier findings that UK sanctions were of limited relevance because the only available assets, the ING Funds, were insufficient to satisfy the interim payments previously ordered. It also remained unpersuaded that a payment instruction given by the defendant outside the United Kingdom would breach the Russia Regulations, or that receipt of funds into a UK bank account created a real risk of breach or another criminal offence.
4. Taking account of those findings and the claimants’ assurance concerning contempt proceedings, there were no good reasons to depart from the usual order. The defendant was ordered to pay the summarily assessed costs of £134,484.96 within 14 days of the Order.

The judgment concerns costs following the court’s earlier dismissal of the defendant’s variation application. The defendant did not seek permission to appeal from the judge. The earlier Order and Judgment formed part of the same proceedings.