13 December 2016Print This Post

Second application for security for costs “not an abuse of process”

Jersey: questions over company's ability to pay costs

Jersey: questions over company’s ability to pay costs

A businessman involved in a £132m dispute with property tycoons Nick and Christian Candy has been ordered to provide £5.5m security for costs after the High Court rejected arguments that the application was an abuse of process because the Candys had withdrawn a previous application.

Mr Justice Nugee said Mr Holyoake brought the £132m damages claim for conspiracy to injure with Hotblack Holdings, a Jersey-based company “ultimately” owned by him.

He said the Candys, along with the CPC Group and three of its directors – Richard Williams, Steven Smith and Timothy Dean – denied all liability for damages and brought the security for costs application because there was reason to believe Hotblack would be unable to pay the defendants’ costs.

Delivering judgment in Holyoake and Hotblack Holdings v Candy and others [2016] EWHC 3065 (Ch), Nugee J said it was not an abuse of process for the defendants to bring their second security application.

The first application was withdrawn on the eve of the hearing after the defendants received information about Mr Holyoake’s financial situation that suggested he had €20m sitting in a bank account.

The judge found that this was not done as “a simple acceptance” that it was right to make no order, but as the result of a bargain between the parties that in return for the defendants withdrawing the application, the costs would be costs in the case. This was embodied in a consent order.

Also, the claimants noted by email that the defendants had reserved the right to bring a further application for security.

But Nugee J said this was not a contractual agreement that that the defendants could apply again on any grounds they liked. The consent order disposed of the matter and so the defendants could only launch a fresh application by showing a good reason for doing so.

He found that there were: “It does not seem to me that there is anything inappropriate in the defendants having withdrawn the first application at a stage when, although they had suspicions, they had no material to indicate that the impression given by [a statement by the claimants’ solicitor] was wrong, and then applying again once they had obtained evidence casting real doubt on that impression.”

Ordering Hotblack to provide security of £5.5m, Nugee J said the defendants had accepted that an after-the-event policy was sufficient to meet £4m of it.

By Nick Hilborne


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