Vernon v Green
| Jurisdiction | Cayman Islands |
| Judge | Kawaley, J. |
| Judgment Date | 23 November 2020 |
| Court | Grand Court (Cayman Islands) |
(Kawaley, J.)
GRAND CT.
Civil Procedure — costs — entitlement to costs — where defendant to personal injuries claim successfully defended plaintiff's unmeritorious application for summary judgment but made unmeritorious and unsuccessful strike-out application, no order as to costs — both parties acted improperly (GCR O.62, r.11(2))
Held, ruling as follows:
(1) Order 62, r.11(2) of the Grand Court Rules entitled the court to disallow costs to which a successful party would otherwise be entitled. The court was required to determine whether “anything has been done or that any omission has been made improperly, unreasonably or negligently.” Rule 11(2) had to be viewed in the wider context of O.62 as a whole. The overriding objective of O.62, set out in O.62, r.4(2), made clear that a successful party's entitlement to costs was qualified. It only vested where that party had conducted the relevant proceedings in an “economical, expeditious and proper manner.” The court construing and applying the costs jurisdiction conferred by O.62 must have regard to para. 1 of the Preamble to the Rules, which provided that the overriding objective of the Rules was to enable the court to deal with every cause or matter in a just, expeditious and economical manner. In addition, para. 3 of the Preamble provided that parties were obliged to help the court to further the overriding objective and that, in applying the Rules to give effect to the overriding objective, the court could take into account a party's failure to help in this respect. Therefore, a failure by litigants to assist the court to give effect to the overriding objective might validly be taken into account when exercising the costs jurisdiction under O.62 generally and, in particular, when determining whether a party had acted “unreasonably, improperly or negligently” for the purposes of O.62, r.11(2) as read with O.62, r.4(2). The term “improperly” in O.62, r.11(2) must include conduct which to a material extent was inconsistent with the overriding objective of O.62, namely that a successful party should recover the reasonable costs “incurred by him in conducting that proceeding in an economical, expeditious and proper manner.” Litigating in a way that was wasteful of costs and/or that delayed the ordinary course of litigation must constitute potential grounds for disallowing a successful party his or her costs. What costs penalty was appropriate in individual cases was a fact-sensitive consideration, as was assessing the seriousness of the relevant “misconduct.” What was “proper” was a somewhat more open-ended question. Improper conduct must include conduct analogous to abuse of process and non-compliance with the letter and/or spirit of the Rules. Conducting litigation improperly, for the purposes of O.62, r.11(2), as read with O.62, r.4(2), must include failing to comply with the obligation imposed on civil litigants by para. 3 of the Preamble to the Rules to assist the court to further the overriding objective (paras. 29–37).
(2) In respect of the costs of the plaintiff's summary judgment summons, the defendant succeeded in dismissing the summons which the court found ought not to have been filed immediately before trial. Prima facie, assuming the defendant conducted this interlocutory matter in an economical, expeditious and proper manner, she would be entitled to recover her costs of successfully defending the summons, probably on the indemnity basis. However, the defendant did not simply respond to the plaintiff's summons by seeking its dismissal, she filed a strike-out application which was dismissed and which the court found ought not to have been made. The two summonses were heard together and more court time was spent dealing with the defendant's summons. It would be artificial to find that the defendant's conduct of her own summons had no implications for her entitlement to costs of the plaintiff's misconceived summons. The pursuit of a fourth unsuccessful strike-out application as opposed to simply defending the plaintiff's summary judgment application was improper because (a) it was inconsistent with the defendant's obligation to pursue proceedings in an economical and expeditious manner; (b) it was inconsistent with the defendant's duty to assist the court to ensure that the substantive law was rendered effective. The plaintiff had an apparently strong claim which deserved to be tried on its merits rather than struck out summarily on technical grounds; (c) it was inconsistent with the defendant's duty to assist the court to ensure that the normal course of the proceedings was facilitated rather than delayed; (d) it was inconsistent with the defendant's duty to assist the court to ensure that the litigation proceeded in an economical way and without unnecessary expense; and (e) it was inconsistent with the defendant's duty to assist the court to ensure that its resources were not wasted on unnecessary or unnecessarily protracted proceedings. The defendant's costs of her successful opposition of the plaintiff's summary judgment summons should be disallowed pursuant to O.62, r.11(2) as read with O.62, r.4(2) and the Preamble to the Grand Court Rules (paras. 38–41).
(3) In respect of the costs of the defendant's strike-out summons, the plaintiff succeeded in dismissing the summons, which the court found ought not to have been filed at all. Prima facie, assuming the plaintiff conducted this in an economical, expeditious and proper manner, she would be entitled to recover her costs of successfully defending the application, probably on the indemnity basis. However, the filing of the summary judgment summons materially contributed to the defendant's decision to file the strike-out summons. It would be wholly artificial to conclude that this filing could be entirely severed from the plaintiff's successful defence of the defendant's summons for O.62, r.11(2) purposes. The plaintiff's successful opposition to the defendant's summons was improper and/or unreasonable because (a) it was inconsistent with the defendant's obligation to pursue proceedings in an economical and expeditious manner; (b) it was inconsistent with the plaintiff's duty to assist the court to ensure that the normal course of the proceedings was facilitated rather than delayed; (c) it was inconsistent with the plaintiff's duty to assist the court to ensure that the litigation proceeded in an economical way and without unnecessary expense. No further interlocutory hearings should have been required before trial; and (d) it was inconsistent with the defendant's duty to assist the court to ensure that its resources were not wasted on unnecessary or unnecessarily protracted proceedings. The plaintiff's costs of her successful opposition of the defendant's strike-out summons should be disallowed pursuant to GCR O.62, r.11(2) as read with O.62, r.4(2) and the Preamble to the Grand Court Rules (paras. 42–45).
(1) Autumn Holdings Asset Inc. v. Renova Resources Private Equity Ltd., 2017 (2) CILR 136, considered.
(2) Burrows v. Vauxhall Motors Ltd., [1998] P.I.Q.R. P48, considered.
(3) Global-IP Cayman, In re, Cause No. FSD 47 of 2020, Grand Ct., July 21st, 2020, unreported, considered.
(4) Lahey v. Pirelli Tyres Ltd., [2007] EWCA Civ 91; [2007] 1 W.L.R. 998; [2007] 3 Costs L.R. 462; [2007] C.P. Rep. 21; [2007] P.I.Q.R. P20, considered.
(5) Sandcroft v. Reliable Indus. Ltd., 2019 (1) CILR 77, referred to.
(6) Woods Furniture & Design Ltd. v. James, Cause No. 511 of 2009, Grand Ct., October 15th, 2019, unreported; on appeal, 2020 (2) CILR 543, considered.
An order was sought as to costs.
The plaintiff brought an action against the defendant for personal injuries. Immediately before the trial on liability, the plaintiff filed an application for summary judgment and the defendant applied to strike out the action (this was the fourth strike-out application made by the defendant in the proceedings). The court dismissed both summonses. The court's provisional view was that neither party was entitled to recover the costs of their successful opposition to the other's application. Both parties had demonstrated that the other had made an application which was unmeritorious and ought not to have been made.
The relevant provisions of the Grand Court Rules provided:
Order 62, r.4(2):
“(2) The overriding objective of this Order is that a successful party to any proceeding should recover from the opposing party the reasonable costs incurred by him in conducting that proceeding in an economical, expeditious and proper manner unless otherwise ordered by the Court.” Order 62, r.11(2):
“(2) Where it appears to the Court in any proceedings that anything has been done or that any omission has been made improperly, unreasonably or negligently by or on behalf of any party, the Court may order that the costs of that party in respect of the act or omission, as the case may be, shall not be allowed and that any costs occasioned by it to any other party shall be paid by him to that other party.” Preamble:
“1.1 The overriding objective of these Rules is to enable the Court to deal with every cause or matter in a just, expeditious and economical manner. …
3 The parties are obliged to help the Court to further the overriding objective. In applying the Rules to give effect to the overriding objective the Court may take into account a party's failure to help in this respect.”
Grand Court Rules 1995, Preamble: The relevant terms of the Preamble are set out at para. 30, para. 32 and para. 33.
O.62, r.4(2): The relevant terms of this subrule are set out at para. 19.
O.62, r.4(5): The relevant terms of this subrule are set out at para. 20.
O.62, r.11(2): The relevant terms of this subrule are set out at para. 21.
Civil Procedure Rules, r.41.11: The relevant terms of this rule are set out at para. 34.
C. Allen for the plaintiff;
A. Woodcock and P. Keeble for the...
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