QB-2021-004022 - [2025] EWHC 1701 (KB)

As set out in the Introduction above, the Claimant’s claims against the Second and Third Defendants were dismissed in my Judgment handed down on 4 February 2025. They are therefore on the face of it, entitled to their costs although Mr Innes’ submissions are limited to the Second Defendant only as he has at no time been instructed on behalf of the Third Defendant. He suggests that not only should the Claimant pay the Second Defendant’s costs but also that there should be a payment on account in the sum of £22,780.

I agree with Mr Innes that the Claimant should be required to pay the Second Defendant’s costs limited to those incurred specifically in addressing the allegations made against him in his personal capacity as a Director of the First Defendant. In default of agreement between the parties, it will be for the costs judge to assessment what those costs are – I have not made a similar decision in respect of those costs to that which I made in relation to the Claimant’s costs against the First Defendant. In the latter case, I did feel able to come to a sensible and reasonably informed view as to what proportion of the Claimant’s costs overall should be regarded as being attributable to the claim against the First Defendant only. I do not have the same level of confidence in relation to the collective costs of the Defendants and so feel obliged to leave this to a detailed assessment if appropriate. Given the uncertainty surrounding this issue, I do not think that it is appropriate to award any sum greater than £5,000 by way of payment on account.

Ms Grossman has suggested that it would be “an affront to justice” for the Second Defendant to receive any payment on account, given what she says are the substantial uncertainties around the question of whether he has in fact incurred any costs, and if so how much, in defending the action against him. Whilst I think that the language of “affront” of perhaps an overstatement of the position, the underlying concerns that she has expressed are in any event addressed in terms of the low figure that I have determined should be paid on account.

As to the Third Defendant, whilst it seems to me that he is also entitled to the costs of defending the action against him. However, given that he has played no part in the trial process and I have no information as to his position save the limited contents of paragraph 25 of Mr Innes’ submission of 8 April 2025 (in which he says that the Third Defendant’s position aligns with that of the Second Defendant) and paragraph 16 of Ms Grossman’s submission of 8 April 2025 (in which she refers to an email to similar effect apparently having been received from the Third Defendant), I am not prepared to make any order for payment on account of any of his legal costs. It will be for the Third Defendant to take such steps as he is able to as an undischarged bankrupt in the event that he wishes to take the issue of costs further based on the Order which I have made.