Frontiers Capital I Limited Partnership v Thomas Flohr

Under section 51 of the Senior Courts Act 1981, the question is whether a non-party costs order is just in all the circumstances. “Exceptional” describes cases outside the ordinary run; it is not a separate threshold. The central inquiry is whether the non-party was the real party to the litigation. Control and funding are relevant, but personal benefit is especially important. A director or liquidator is not protected merely by that role if the proceedings were pursued for personal purposes. Where litigation was genuinely pursued for a company’s benefit, another reason will commonly be needed to order costs against its director or liquidator. Serious impropriety may provide such a reason, but it is not a prerequisite where the non-party was himself the real party.

After Frontiers Capital I Limited Partnership’s claim against Thomas Flohr was dismissed on limitation grounds in [2025] EWHC 678 (Ch), the claimant was ordered to pay 90% of Mr Flohr’s costs. When those costs remained unpaid, Mr Flohr sought an order under section 51 of the Senior Courts Act 1981 against Timothy Piers Horlick, who had controlled and funded the proceedings and was director and liquidator of the claimant’s general partner. The central issue was whether Mr Horlick had pursued the claim for the limited partners’ benefit or was himself the real party to the litigation. The court heard cross-examination about his expected financial return, his dealings with investors and his conduct of the claim.

1. Application granted. The court ordered Mr Horlick to pay Mr Flohr’s costs of the proceedings under section 51 of the Senior Courts Act 1981.
2. The discretion is fact-specific and must be exercised justly. “Exceptional” means outside the ordinary run of parties litigating for their own benefit and at their own expense. The key question is whether the non-party was fairly to be regarded as the real party. Control and funding are relevant indicators, but they are not a checklist; personal benefit is particularly important. The court applied the principles in Dymocks Franchise Systems (NSW) Pty Ltd v Todd [2004] 1 WLR 2807 and Goknur Gida Maddaleri Enerji Imalet Ithalat Ihracat Ticaret ve Sanati AS v Aytacli [2021] EWCA Civ 1037.
3. A claim pursued through a company or general partner may in principle be treated as litigation for the benefit of its investors. But a director or liquidator is not the real party merely because of that office. Where the individual’s own interests drive the litigation, an order may be just without proof of litigation misconduct. The court accepted that serious impropriety may matter where litigation is genuinely pursued for the company’s benefit, but did not treat it as a universal requirement.
4. Mr Horlick’s control and funding were undisputed. The court also found that he had not been candid about the financial return he expected. His potential entitlements included more than the 7.2% investor return he identified, including remuneration and an interest in the general partner’s entitlement. He had caused the litigation to proceed without meaningful consultation with the limited partners and had pursued claims reflecting his own grievances. Those matters showed that his purposes, rather than the investors’ interests, drove the proceedings. The court made no finding that he intended to act improperly or that the allegations concerning confidentiality orders amounted to misconduct; they were not properly evidenced.
5. The absence of advance warning of the costs application did not affect the outcome, since a warning would not likely have made a difference. Consequential matters were reserved for determination on paper, and the parties were directed to seek to agree a timetable for written submissions.

No appeal is described. The judgment records earlier decisions in the same proceedings: [2025] EWHC 678 (Ch) and [2023] EWHC 2723 (Ch) .