Debt – application by the plaintiff seeking permission to continue
action.
[2014]JRC187
Royal Court
(Samedi)
29 September 2014
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Before :
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Advocate Matthew John Thompson, Master of
the Royal Court, sitting alone.
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Between
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Hong Kong Foods limited
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First Plaintiff
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And
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Robert Alan Gibbons
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Second Plaintiff
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And
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Robin Hood Curry House Limited
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First Defendant
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And
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Barry Thirkell
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Second Defendant
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Advocate O. A. Blakeley for the Plaintiffs.
Advocate C. Hall for the Defendants.
judgment
the master:
Introduction
1.
This is an
application by Hong Kong Foods Limited and Robert Alan Gibbons (“the
plaintiffs”) seeking permission to continue their action against Robin
Hood Curry House Limited and Barry Thirkell (“the defendants”) and
asking the Court to exercise its discretion not to strike out the action on the
basis that no summons for directions was issued within the time period set down
by Rule 6/26(13) of the Royal Court Rules 2004, as amended (the
“Rules”).
2.
Proceedings
were issued by the plaintiffs on 24th December, 2010, when the
action was placed on the pending list.
3.
Between
January and March 2011 correspondence took place between the plaintiffs’
legal adviser and the defendants’ then legal adviser about whether the
defendants’ then legal adviser could represent the defendant. This delayed the filing of an
answer. Ultimately, an answer was
filed on 31st March, 2011.
4.
On 26th
April, 2013, the Deputy Judicial Greffier sent out a circular to all Jersey
Advocates, solicitors and litigants in person informing them that the actions
listed in the circular were liable to be dismissed unless a summons was issued
to show cause why the action should not be struck out. The present proceedings were included on
that list.
5.
On 2nd
May, 2013, Advocate Blakeley sent a summons for directions to the
defendants’ then legal adviser informing that a date fix appointment had
been made for 28th May, 2013, to fix a date for Advocate
Blakeley’s summons for directions.
It appeared that a date was fixed on 28th May, 2013. At the time he applied to issue his
summons, Advocate Blakeley had not noticed that the proceedings had been
included in the Deputy Judicial Greffier’s strike out list.
6.
On 11th
June, 2013 the defendants’ then legal adviser informed Advocate Blakeley
that it no longer acted for the defendants and instead Advocate Godden of
Messrs. Le Gallais & Luce was now acting.
7.
On 17th
June, 2013, Advocate Godden wrote to Advocate Blakeley confirming that the
directions proposed were agreed and a consent order was signed. In addition to the directions proposed
in the plaintiffs’ summons, a direction was agreed staying the matter for
mediation for 8 weeks.
8.
The
consent order was filed with the court on 18th June, 2013.
9.
On 21st
June, 2013, Master Wheeler wrote to Advocate Blakeley as follows:-
“I refer to your letter
of 18th June enclosing a Consent Order in relation to the above
action.
Having reviewed the Court File
I see that the action was listed in the Circular distributed by the Deputy
Judicial Greffier indicating that the Court intended dismissing the action
under the powers conferred upon it by the Royal Court Rules 2004. Despite the terms of the Notice, all
that has happened is the issue by you of summons for directions and the
subsequent filing of a purported Consent Order in which directions are agreed.
In accordance with the terms of
the Notice it is incumbent upon the parties to satisfy me that it is
appropriate that the action be allowed to continue. In the absence of any hearing before me
or even any written submissions on the subject there is no basis on which it
would be appropriate for me to allow the action to remain. Before considering your purported
Consent Order I therefore require to be convinced that this is the appropriate
way to proceed.
I suggest that you either
arrange a date for the parties to come before me on this matter or, if it is
agreed between you and Advocate Godden, I would be prepared to make my decision
on the basis of written submissions received from you both.
I am sending a copy of this letter
to Advocate Godden so he is aware of what I have said and I await hearing from
you both in due course.”
10. Ultimately, the summons required by Master
Wheeler has only come before me now for determination due to the matter being
stayed by agreement with Court approval as a result of health issues suffered
by the second defendant which it is not necessary to set out in detail. The effect of these issues meant that the
second defendant was unable to give instructions until recently. I have not therefore taken into account
or considered any period after May 2013 in deciding whether or not the action
should continue.
11. Finally, it is right to note that the
defendants are now represented by Advocate Hall of Messrs Viberts. At present she has only been instructed
in relation to the application to continue the action and has not advised the
defendants on the merits of the plaintiffs’ claim, or the answer and
counterclaim because of a potential disagreement with the plaintiffs and
Advocate Blakeley as to whether Viberts are prevented from acting due to an
alleged conflict of interest.
Factual background
12. The plaintiffs’ claim arises out of a
lease of premises at No.8 Cheapside, St. Helier (“the
Premises”). On 2nd
April, 2004, the first plaintiff entered into a 21 year lease of the premises
with the owner of the premises, Mrs Moore.
The second plaintiff with another (now released) was guarantor of the
first plaintiff’s obligations under the lease with Mrs Moore. The premises were later inherited by Mrs
Moore’s daughter, Diana Moore (“the landlord”). The head lease was a fully repairing
lease.
13. On 24th May, 2005, the first
plaintiff sub-let the premises to a company known as “Chinese Whispers
Limited whose obligations were guaranteed by a Mr David Moore (no relation of
Mrs Moore or the landlord) and a Mr Chan.
The granting of the sub-lease was authorised by Mrs Moore. The rent payable under the sub-lease was
£36,000 per annum. The rent
under the lease was initially £26,000 per annum. By 2008, the annual rent was
£30,000.
14. In or about June 2008, the sub tenant got into
financial difficulties and discussions commenced between the sub tenant, its
guarantors, the plaintiffs and the defendants concerning a possible assignment
of the sub-lease to the first defendant.
15. Ultimately it was agreed between the sub
tenant, the plaintiffs and the defendants that the first defendant would take
an assignment to the sub-lease with a guarantee from by the second
defendant. The landlord did not
consent to the assignment. It is in
issue between the plaintiffs and the defendants whether the landlord’s
consent was needed. The extent of
the assignment agreement is also in dispute, including whether obligations
would be taken on by the defendants in relation to amounts owed by the sub
tenant to the first plaintiff and whether or not consumables were to be left at
the premises being taken over by the defendants.
16. The plaintiffs allege that around the date of
the assignment the defendants commenced certain building works at the premises
to undertake to refurbish and upgrade the premises (“the works”). The plaintiffs allege that the works were
not completed and the premises were left in a state of disrepair by the
defendants.
17. This state of repair of the premises led to the
landlord commencing proceedings against the plaintiffs which resulted in a
judgment of the Royal Court dated 9th July, 2010, Moore v Hong
Kong Foods Limited & Gibbons [2010] JRC 127, given by Commissioner Sir
Philip Bailhache. At paragraph 4 of
its judgment, the Royal Court noted that the validity of the assignment between
the sub-tenant and the current defendants was in dispute. The plaintiffs, as defendants in the
proceedings brought by the landlord, did not dispute claims for arrears of rent
and outstanding insurance premiums.
However, they resisted cancellation of the lease.
18. At paragraph 14 of the judgment Sir Philip
Bailhache, Commissioner, in ordering cancellation of the lease, stated as
follows:-
“While we think that that
description is a little hyperbolic, we do agree that the defendant has proved
to be a very unsatisfactory tenant.
The difficulties with sub-tenants were of no consequence whatsoever to
the plaintiff. The plaintiff was
entitled to receive the agreed rent for the premises. To refuse to pay the rent due under a
lease particularly over an extended period is a very serious breach which goes
to the root of a contract for the letting of land. We can well understand why the plaintiff
is unwilling to contemplate remaining in a contractual relationship with the
defendant.”
19. The head lease was therefore cancelled.
20. The court also gave summary judgment on liability
in respect of a failure to repair the premises, remitting to the Judicial
Greffier the question of quantum.
21. Finally, the judgment at paragraph 20 stated as
follows:-
“As a post script we note
that the defendant intends, according to his counsel, to seek to convene the
sub-tenant or sub-tenants to these proceedings. Again, without making any finding to
that effect, it does appear on the face of it to us, that Robin Hood Curry
House Limited and/or the guarantor, Mr Thirkell, are prima facie responsible on
a quantum merit basis to contribute towards the costs of the restoration of the
premises in relation to the damage they appear to have caused. Whatever the position may be in regard
to the assignment of the sub-lease so far as the plaintiff is concerned, a
contract appears to have been made between the parties to the deed of
assignment. We will say no more on
that other than to recommend to the parties that differences of this kind might
well be resolved more expeditiously and more cheaply at mediation. That concludes the judgment of the
Court.”
22. As a result of this judgment, what is now
claimed by the plaintiffs from the defendants in the order of justice before
me, is as follows:-
(i)
The
plaintiffs’ legal costs in defending the landlord’s claims;
(ii) Experts fees incurred by the plaintiffs in
defending the landlord’s claim;
(iii) £60,000 representing monies paid to the
landlord in settlement of costs awarded in her favour and her claims for
repairs;
(iv) Loss of rent under the sub-lease being the
difference between rent payable under the head lease and the agreement payable
under the sub-lease for the remainder of the rent in the sum of £6,000
per year. At the date of
termination of the lease, the lease and sub-lease both had a further 15 years
to run unless terminated early. The
amount of the claim is therefore put at £90,000.
The total amount of the plaintiffs claim is
therefore in the region of £175,000 plus its costs.
23. The defendants dispute any liability to the
plaintiffs and in summary argue as follows:-
(i)
The
plaintiffs did not have the landlord’s permission to assign the sub-lease
and therefore no valid assignment was entered into;
(ii) The premises were in a state of disrepair which
was the fault of the plaintiffs. In
particular work carried out to remove a chimney breast on the first floor was
defective. Complaint is also made
about a failure to reinforce the floor of the back store room on the first
floor of the premises. More
generally the defendants allege that building works carried out at the premises
by the plaintiffs were of poor quality and contained numerous defects. It is also argued that the works carried
out by the plaintiffs did not have the required consent from the Minister of
Planning and Environment.
24. The defendants therefore counterclaim the costs
of the works they did carry out and sums paid to the first plaintiff in respect
of the assignment of the lease and rent in a sum of £79,000 plus loss of
profits, plus costs.
25. The difference between the plaintiffs’
claim and the defendants counterclaim is therefore in excess of £250,000.
Legal Principles
26. There is no real disagreement between the
parties of the relevant legal principles on a strike out application for breach
of the Rules which briefly are as follows:-
(i)
The power
to strike out is contained in Rule 6/26(13) of the Rules which permits the
court of its own motion to dismiss an action after giving 28 days’ notice
in writing to all the parties;
(ii) On considering whether an action can be
dismissed the court considers the following by reference to Lescroel v Le
Vesconte [2007] JLR 273:-
(a) Apart from the failure to issue a summons for directions,
has the plaintiff prosecuted its case with at least reasonable diligence;
(b) Is the failure to apply to issue for a summons
for directions within the time frame contemplated, excusable;
(c) Has the plaintiff satisfied the Master/Court
that the balance of justice indicates that the action should be allowed to
continue?
27. Ultimately, the court in Lescroel also
noted that the Master had a discretion.
In B v MR [2007] JLR N 48, the Royal Court stated “the
decision to dismiss an action without considering the merits should be taken on
the basis of all the circumstances.
The three questions should not therefore be considered sequentially with
the court only considering the next question if the plaintiff succeeded on the
previous one”.
28. It is also clear that the remedy of dismissal
must not be disproportionate to the breach involved (see B v MR [2007]
JRC 139 at paragraph 26 and Irish Nationwide v The Volaw Corporate Trustee
Limited & Ors [2012] JRC 035 at paragraph 27).
29. In Vieira v Kordas [2014] JRC 042 although
considering a strike out under Rule 6/13 of the Rules, which is a slightly less
stringent test, W. J. Bailhache, Deputy Bailiff at paragraph 19 stated as
follows:-
“We come now to the question
as to what sanction should be applied in the light of the first two
findings. Having regard to the
Article 6 Convention rights of the parties, we note and accept the proposition
that we should not apply the most severe sanction of striking out the
plaintiff’s claim if there are other sanctions which could be applied
which would enable justice to be done between the parties. Illustrations of the type of sanctions
– costs orders, orders that no interest be due on any sum awarded and so
on – are canvassed in some of the other cases. On the other hand, if the court were to
be of the view that it is now no longer possible to have a fair trial of the
action, then there would undoubtedly be prejudice to the defendant, and it
would not be right to allow the action to proceed.”
I consider it is correct to take the same approach
in exercising the discretion vested in me where a beach of Rule 6/26 has
occurred.
30. In Eckman v Sidem International Limited
& Anor [2009] JRC 233, the Royal court considered whether it was
appropriate for a defendant to let sleeping dogs lie. At paragraph 63 Commissioner Clyde-Smith
stated:-
“ In Hately-v-Morris and
others (2004) 1 BCLC 582, a case involving an application to strike out a
petition on the grounds that it was an abuse of the process of the Court, Mann
J made this comment:-
“I have in mind the passage
from Asiansky, set out above, which points out that it is not always
appropriate for defendants to let sleeping dogs lie. This was not a case where the next step
in the action was something which it was within the sole province of the petitioner
to carry out. Nor is it a case in
which there has been some express order with which the petitioner has failed to
comply. The next step required in
this petition after 9 April 2002 was a further CMC. The respondents could themselves have
applied to re-fix the date, even though it might be said that the
responsibility lay more naturally with the petitioner because it was his
petition. They did not do so, and
did not indicate which counsel was to be instructed in place of counsel had
been acting up to that time. The
picture would have been very different if the registrar had been correct in his
finding that the petitioner had expressly assumed responsibility for re-fixing,
but there is no evidence to support it.””
31. The Royal Court then went on to say:-
“In our view, similar
sentiments now apply in this jurisdiction and in the light of Esteem and
the practice direction, it is not always appropriate for defendants to let
sleeping dogs lie. Issuing a
summons for directions was not within the sole province of the plaintiff. The second defendant was in a position
to issue such a summons or at least to have formally warned the plaintiff that
failure to do so could lead to a summons for dismissal being issued. Such a warning, unheeded by the
plaintiff without good excuse, could assist in tipping the balance of justice
towards dismissal being the just and proportionate remedy.”
The plaintiffs’ arguments
32. By reference to the above chronology, Advocate
Blakeley accepted that there had been a period of inordinate delay between June
2011 and May 2013 when he applied to issue a summons for directions.
33. He did, albeit with a degree of reticence, seek
to argue that the delay was excusable.
He contended I should take into account the health of the second plaintiff
who has suffered clinical depression for a number of years. Advocate Blakeley
stated that, having been in a dispute with the landlord leading to the judgment
of Sir Philip Bailhache to which I have referred, the second plaintiff found it
very difficult to move matters forward. The second plaintiff at all times was
sole owner and director of the first plaintiff. As a result of the Royal Court’s
judgment, the plaintiffs were facing claims for costs of repair, legal costs
and arrears of rent in excess of £200,000. While ultimately the second plaintiff
was able to settle this sum for a payment of £60,000 in total in 2011,
nevertheless the claim by the landlord was stressful and it was difficult for the
second plaintiff to cope with further litigation. Without in any way undermining the
challenges depression can pose, I have to observe that it is not clear from the
medical evidence filed whether the second plaintiff was receiving treatment for
depression in the period with which I am concerned.
34. The main thrust of Advocate Blakeley’s
clear submissions however concerned where the balance of justice lay. In summary his arguments were as
follows:-
(i)
The
defendants had agreed to mediation in 2013 and to the action progressing. No justification had been advanced for
the change of heart since then. To
the extent it was suggested that the defendants had received poor legal advice,
the court should not be drawn into an enquiry about what advice had been
received or its merits. Rather, the
court should simply note that the defendants’ initial reaction was to
agree to the matter going to trial and to agree to mediate. The change of position had not been
justified.
(ii) The defendants had not issued a summons for
directions either;
(iii) The matters was not prescribed and, therefore,
were fresh proceedings to be issued now, the defendants would have to deal with
them. There was therefore no real
difference between having to deal with fresh proceedings and having to deal
with the proceedings that had not progressed for a period of time.
(iv) One of the issues between the plaintiffs and
the defendants was a matter of law, namely the question of validity of the
assignment. This matter of law
could still be argued without any prejudice.
(v) In so far as oral evidence was required about
what was discussed in relation to the assignment or the condition of the premises,
such evidence could be given by the second plaintiff and the second
defendant. Furthermore, there were
the records of the specification of works produced by J. S. Carney for the
landlord in relation to the premises dated 31st August, 2010, and
the supporting documentation, together with evidence from Ross Gower Engineers
who were retained by the defendants in 2009.
(vi) In relation to the evidence of Ross Gower, in
the course of argument Advocate Blakeley referred to an affidavit of the second
defendant sworn on 2nd March, 2010, which was subsequently provided
to me. At paragraphs 14 to 20 of
that affidavit the second defendant refers to evidence of the condition of the premises
in assessments by Mr Clarke of Ross Gower of work carried out to the premises.
35. Advocate Blakeley further accepted that I had
power to impose conditions if the plaintiffs were permitted to continue the
action, including payment of costs and disallowing interest. However, because the defendants were
also at fault in not pursuing their counterclaim, it would not be appropriate
in this case to order a payment of all costs on an indemnity basis, as occurred
in Eckman and that the question of interest being disallowed should be
left to the trial court to determine.
The defendants’ arguments
36. Advocate Hall argued equally clearly as
follows:-
(i)
As the
court was facing a breach of the Rules this was a stricter test than cases
relating to a strike out for want of prosecution;
(ii) The defendants had received fresh legal advice
(without waiving privilege) and were entitled to change their mind and oppose
the plaintiffs’ application. They
wanted the present summons resolved before considering any issues of mediation.
(iii) Delay was not excusable;
(iv) While Advocate Hall was sympathetic to the
second plaintiff’s depression, there was no evidence or treatment of
depression in the period with which the court was concerned. Reasons of health in any event have to
be exceptional to excuse an inordinate delay;
(v) The plaintiffs in any event had failed to act
to put the case on hold while facing health or any other issues.
(vi) The period of delay was very significant. By reference to Ybanez v BBVA
Privanza Bank (Jersey) Limited [2007] JRC 131, the court expected simple
cases to be concluded within twelve months and most cases within twenty-four
months. The present plaintiffs had
sat on their hands for the period of time in which the court expected matters
to be concluded.
(vii) The fact that the claim was not prescribed did
not matter. Once an action was
commenced the obligation was on the party to get on with it. In Garfield-Bennett v Phillips
2002/214 in the postscript to his judgment, Birt Deputy Bailiff stated:-
“It is one thing to be slow
in bringing an action but nevertheless bring it within a limitation period laid
down by law; it is another to start an action at an earlier stage and then so
disregard the requirement to progress matters expeditiously as to lead the Court
to strike out the action.”
(viii) In Begg v Raynes [2013] JRC 183A I also
stated at paragraph 21:-
“In my judgment once a
plaintiff has issued proceedings his duty is to progress those proceedings to
trial or a conclusion within the time frames contemplated by the Court’s
Rules and practice.”
(ix) In relation to evidence, by reference to an
affidavit filed by the second defendant in opposition to this application, the
evidence required at trial was oral. At this stage the second defendant does
know how he will find individuals to prove his case. Those who worked on the site cannot now
recall the condition of the premises to the level of detail required.
(x) The defendants did not do anything because they
formed the view that the plaintiffs had decided not to pursue matters. They therefore let sleeping dogs lie.
(xi) While the defendants have a counterclaim, if
the plaintiffs’ claim is struck out, the defendants accept their
counterclaim should also be struck out.
If, however, the plaintiffs’ claims survive, the defendants wish
to pursue their counterclaim.
(xii) If I was minded to allow the action to continue
then the costs of the present application should be paid by the plaintiffs on
an indemnity basis.
(xiii) Advocate Hall agreed it should be an issue for
the Court at a trial to decide whether or not interest should be deducted, if
the plaintiffs were successful in their application and at trial.
Decision
37. The view I have reached is that the plaintiffs
have just persuaded me that the action should be allowed to continue for the
reasons set out below. However, the
decision was very close and any further delay coupled with the period of delay
that has occurred already is very likely to lead to the action being
dismissed. The plaintiffs moving
forward must make every effort to take this matter to trial as soon as
reasonably can be achieved. My
reasons for reaching this conclusion are as follows.
38. While it was agreed that the delay is
inordinate, a period of delay of twenty-three months is not excusable. A delay of twenty-three months without
any stay or without any justification cannot be justified by reference to the
timetables the court expects parties to adhere to (see Ybanez). Such a period points strongly towards
dismissal.
39. However, I accept by reference to the second
plaintiff’s depression, that some part of this period is excusable
because depression is not an easy condition. I can appreciate why it would have taken
some time for the second plaintiff to decide whether he wished to pursue the
litigation given the claims he faced from the landlord. However, such a delay would be for a
period of a few months only. Absent
extremely compelling medical evidence which is not present in this case, the
second plaintiff’s depression does not justify a delay of twenty-three
months. Even giving the second
plaintiff the benefit of the doubt of a period of delay of up to six months,
which is generous to the second plaintiff, there is still a period of delay of
some seventeen months which cannot be justified.
40. This is a substantial claim. The amount at stake as noted above
between the parties is in excess £250,000. From the plaintiffs’ perspective,
they are looking to recover £175,000 plus costs and interest. To deprive the plaintiffs from
potentially recovering a significant sum is therefore a factor in the
plaintiffs’ favour in deciding to allow the action to continue.
41. I am not persuaded by the plaintiffs’
argument that if proceedings were issued now the defendants would have to meet
the case as best they could. The
position is as set out in Garfield-Bennett and Begg v Raynes
which requires parties to get on with an action once they have commenced
proceedings.
42. The witness evidence in this case is a mixture
of documentary evidence and oral recollection. In relation to documentary evidence,
firstly, documents relating to the dispute between the landlord and the plaintiffs
relating to the condition of the premises can be produced. Secondly, there is the detailed schedule
of condition produced by Mr Carney setting up the repair works required by the
landlord. Thirdly, the defendants
also retained their own structural engineer, (Mr Clark of Ross Gower) who, by
reference to the second defendant’s affidavit sworn in 2010, inspected
the premises in 2009. This
inspection covered the condition of the chimney breast, the party wall, the
lack of planning consent as well as other issues with the premises. As a professional I would expect Mr
Clark to have records of his observations and it was not suggested
otherwise.
43. Insofar as oral evidence is required, much of
this can also be given by the second plaintiff and the second defendant. I accept that the second defendant also
wishes to call as witnesses, individuals who were actually working at the
premises and he faces difficulties in identifying these individuals and whether
they remember anything. However, I
consider that the defendants can fairly advance a case about the condition of
the premises by reference to the evidence of Mr Clark to which I have referred
as well as the second defendant’s own recollection and the other
documentary evidence referred to above.
I have therefore reached the view that there is sufficient material to
enable a fair trial to take place.
Although this is not a case that is solely dependent on documents, there
appears to be sufficient documentary evidence available to allow evidence to be
put forward about the condition of the premises and who was responsible for it,
notwithstanding the passage of time, as well as oral recollection.
44. I have also taken into account in exercising my
discretion the fact that the defendants let sleeping dogs lie in respect of
their counterclaim. As the court
noted in the passage from Eckman I have cited above, the defendants
could have issued a summons for directions. At the very least, the second defendants
could have indicated that, if no summons for directions was issued by the
plaintiff, then the defendants might apply to strike out the claim. No such warning was given. This is also a case where the defendants
had made a counterclaim in addition to the defence advanced to the
plaintiffs’ claim. The defendants
were therefore seeking to recover monies from the plaintiffs as well as denying
any liability to the plaintiffs. In
those circumstances the defendants in relation to their counterclaim were in
the same position as the plaintiffs in being under an obligation to issue a
summons for directions, which obligation they have breached. The fact that the defendants do not now
wish to pursue the counterclaim, if the plaintiffs’ claim is struck out,
does not excuse or justify the defendants’ failure to issue a summons for
directions.
45. In relation to the effect of the consent order,
signed by Advocate Godden on behalf of the defendants in 2013, I accept that
the defendants are entitled to change their mind based on receipt of different
legal advice (in respect of which privilege was not waived). It is not for me to review the different
advice received. Moreover, even
though the parties had submitted a consent order to the court for approval,
such a step does not mean that the court will approve such a consent order. The approval of a consent order is a
judicial act requiring an exercise of the court’s judgement and
discretion. In this case Master
Wheeler, by his letter of 21st June, 2013, made it clear that he was
not prepared to approve the consent order submitted including the stay in
favour of mediation and wanted to be addressed by the parties on the issues
that I have now had to determine. I
have not therefore taken the consent order or the defendants’ change of
position into account in reaching my decision.
46. Although I have allowed the plaintiffs (only
just) to be able to continue to pursue their claim because of the amount at
stake, because a trial can still take place which will not be unfair and
because of the failings of both parties to pursue their claim and counterclaim,
I do consider that some form of penalty should be imposed on the plaintiffs for
not pursuing their claim for at least seventeen months. Ordinarily, the costs of the application
to continue are payable on an indemnity basis as a sanction for a plaintiff
failing to abide by an express provision of the Rules and the court’s
clear statements in terms of progressing actions to trial once proceedings have
been commenced.
47. In this case in the exercise of discretion
vested in me, I consider that the fair order to make is that the plaintiffs
should pay the defendants’ costs of and occasioned by this application on
the standard basis, such costs to be taxed, if not agreed. This is because the plaintiffs should be
penalised for a breach of the rules. I have not ordered indemnity costs
because of the failure by the defendants to pursue their counterclaim without
justification. I consider this
failure on the part of the defendants means that it would be unfair for the
defendants to benefit from a costs order on an indemnity basis.
48. In light of this judgment I direct the parties
to present to me directions for approval.
In the absence of agreement, the parties should attend before me as soon
as a hearing is available to enable directions to be given. I also encourage
the parties to revisit the question of mediation now that I have decided that
the action should continue.
Authorities
Royal Court Rules 2004.
Moore
v Hong Kong Foods Limited & Gibbons
[2010] JRC 127.
Lescroel
v Le Vesconte [2007] JLR 273
B
v MR [2007] JLR N 48.
B
v MR [2007] JRC 139.
Irish
Nationwide v Volaw Corporate Trustee Limited & Ors [2012] JRC 035.
Vieira
v Kordas [2014] JRC 042.
Eckman
v Sidem International Limited & Anor
[2009] JRC 233.
Hately-v-Morris and others (2004) 1
BCLC 582.
Ybanez
v BBVA Privanza Bank (Jersey) Limited [2007]
JRC 131.
In
Garfield-Bennett v Phillips 2002/214.
Begg
v Raynes [2013] JRC 183A.