Paul Parkhouse v William Sutcliffe

The court has a broad discretion when allocating the costs of an interim injunction application. The general rule that the unsuccessful party pays does not mechanically determine the result. Where interim relief is granted or continued on the balance of convenience, costs will normally be reserved, but the court may make a different order where the parties’ conduct and practical circumstances justify it. The court may assess costs by stages, distinguishing reasonable costs incurred to obtain necessary protection from costs incurred after the dispute has been overtaken by events. An injunction requires a real risk that the relevant mischief will occur or continue. A service provider should not ordinarily be joined where an injunction against its instructing client would suffice.

The claimants sought interim mandatory and prohibitory injunctions concerning shared IT systems, electronic data and telecommunications following the separation of businesses formerly operated within the same corporate group. Access had been restricted by the first and second defendants, with the third defendant IT service provider acting on instructions from the second defendant.

By the further hearing, migration of the claimants’ IT systems and telephone services had been completed. The claimants no longer sought substantive injunctive or monetary relief. The remaining issue was the incidence of the application costs, including whether the third and fourth defendants should bear any costs.

1. Costs discretion. The court had to make a practical judgment as to what was fair and just, having regard to all the circumstances, including conduct under CPR r. 44.2. The merits could not safely be determined on disputed evidence before trial.
2. Interim injunction costs. Desquenne et Giral UK Ltd v Richardson established that where an interim injunction was granted or continued on the balance of convenience, the normal costs order was costs reserved. Picnic at Ascot v Derigs confirmed that this was guidance rather than an inflexible rule.
3. The first and second defendants were ordered to pay the claimants’ costs up to and including 20 November 2024. The parties were to bear their own costs up to and including the hearing on 29 November 2024. The claimants were to pay the first and second defendants’ costs incurred thereafter.
4. An injunction requires a real risk that the relevant mischief will occur or continue. Any necessary injunction against HBL would have sufficed; there was no need to enjoin VITS. The claimants had not shown a serious issue to be tried against Mr Bangher.
5. The costs were to be assessed on the standard basis, with summary assessment on the papers if required. The claimants were ordered to pay VITS and Mr Bangher’s costs.