Zvi Dekel v Clerkenwell Lifestyle (UK) Limited & Ors

A temporary stay may be granted where it best serves the interests of justice and the overriding objective. The court should consider delay and prejudice alongside the efficient use of court resources, proportionality, wasted costs and the risk of duplicative or procedurally complex hearings. Where related derivative claims concern substantially identical facts and would ordinarily be heard together, the court may stay one claim pending the outcome of related appellate proceedings, even where the timing of those proceedings is uncertain. Delay alone, without specific prejudice to a fair hearing, will not necessarily outweigh the advantages of coordinated case management.

The claimant brought substantially similar derivative proceedings concerning a property development project in England and the British Virgin Islands. The English claim concerned the UK subsidiary, while the BVI claim concerned its parent company and included two additional defendants. Permission was required for both claims.

The claimant’s BVI permission applications had been refused at first instance, and appeals were pending before the Eastern Caribbean Court of Appeal. The BVI claim in England had already been stayed pending those appeals. The defendants sought an equivalent stay of the English claim, principally to avoid separate permission hearings, duplicated costs and possible prejudice to the additional BVI defendants. The claimant relied on delay, uncertainty and the potential benefit of early progress and ADR.

1. Stay granted. The court stayed the English proceedings pending final determination of the BVI appeals and any cross-appeals.
2. The power to stay under CPR 3.1(2)(g) is a case-management power which must be exercised consistently with the overriding objective in CPR 1.1. The court also had regard to section 49(2) of the Senior Courts Act 1981, which supports the avoidance of multiplicity of proceedings and the complete and final determination of matters in dispute.
3. The relevant question was whether, on the particular facts, a stay served the interests of justice. The court applied the broad approach summarised in Athena Capital Fund SICAV-FIS S.C.A v Secretariat of State for the Holy See [2021] EWHC 3166 (Comm).
4. The two claims were based on essentially the same facts and, absent the BVI appeals, would have been heard together, including their second-stage permission hearings and trials. Refusing a stay would create a substantial risk of duplicated hearings, additional costs and disproportionate use of court resources.
5. The presence of the additional BVI defendants made separate hearings more complex. They might need to address factual and mixed fact-and-law issues and could be affected by findings made in the English claim, despite not being parties to it.
6. The claimant’s delay prejudice was considered but was not specific prejudice to witnesses or the fairness of the eventual hearing. The uncertainty over the appellate timetable did not outweigh the resource and procedural advantages of a coordinated hearing. ADR considerations did not materially alter that balance.
7. A time-limited stay or preliminary directions for evidence would not satisfactorily address the uncertainty or the desirability of preparing for one joint hearing.