CA-2025-001045-A - [2025] EWCA Civ 1300

Lord Justice Zacaroli:

This is an application by the claimants (the respondents to this appeal - the “Claimants”), for security for their costs of the appeal. The first appellant, Phoenix Ancient Art S.A. (“Phoenix”) is a company incorporated in Switzerland. The second appellant, Ali Aboutaam, is an individual resident in Switzerland. The third appellant, Hicham Aboutaam, is an individual resident in New York. I will refer to the second and third appellants as the “Individual Appellants”.

The Claimants have brought two actions against five defendants (the first three defendants are the appellants to this appeal), one in 2020 (the “2020 Action”) and one in 2023 (the “2023 Action”). The actions relate to artefacts which the Claimants acquired from Phoenix, and which the Claimants contend are forgeries. The 2020 Action relates to a small chalcedony statuette figure of the goddess Nike. The 2023 Action relates to a marble object known as the Head of Alexander the Great as Herakles and a small chalcedony cameo known as the Phalera with an Imperial Eagle. The principal claims advanced by the Claimants are for recission of the contracts of purchase and claims in deceit and conspiracy. The two actions have been managed together.

On 9 December 2024, the Claimants applied for summary judgment and for orders striking out the defences in both actions and debarring the appellants from defending the actions on the grounds that they had failed to comply with disclosure orders.

By an order dated 11 April 2025, in relation to the 2023 Action, Garnham J debarred the appellants from defending, struck out their defence and granted the Claimants summary judgment. By the same order, in relation to the 2020 Action, Garnham J granted the Claimants summary judgment as regards the claims based on fraud, dishonesty and fraudulent misrepresentation, and stayed all other claims. By his order dated 29 April 2025, Garnham J made various consequential orders.

The appellants appeal these orders of Garnham J pursuant to the limited permission to appeal granted by Phillips LJ on 25 July 2025. The essential point which the appellants are permitted to raise on appeal is whether Garnham J was right to order summary judgment (without considering the substantive merits of that application) on the basis that the substance of the allegations which the appellants were precluded from defending were deemed to be admitted. The order granting permission to appeal provided that the Claimants were at liberty to apply for the imposition of conditions on the grant of permission and/or security for costs.

This application for security for costs, which by the time of the hearing was sought in the sum of approximately US$229,000, being 75% of the total anticipated costs of US$305,291.38, was issued by the Claimants on 8 August 2025. We were told that the sterling equivalent of these amounts is roughly £169,000 and £225,000.