HT-2022-000022 - [2025] EWHC 1238 (TCC)

Although Lloyds asserts that, in practice, it has no funds to make payments into Court, Mr Webb KC was fair in conceding that there is no evidence before the Court upon which it could conclude that, were an order for payment into Court (rather than by ATE Insurance) to be made, Lloyds’ claim would be stifled. There is no evidence, as there should be in order to make good such a submission, in relation to other sources of funding which might realistically be expected to be provided, particularly in circumstances where the Lloyds’ own ongoing costs of the litigation are being funded by other sources.

In Recovery Partners, above, the judge held at [17] that on an application for security for costs, the Court has wide discretion not only whether, and in what sum, such security should be provided, but also as to the means by which it should be provided. If two different forms of security would provide equal protection to the defendant the Court should, all else being equal, order the form which is least onerous to the claimant.

I have found, that at present, the policy before the Court does not provide equal protection as a payment into Court. I am not presently prepared to permit Lloyds to rely upon it in lieu of a payment in. However, in the circumstances I have described in which Accor failed to engage constructively in advance of the hearing, I am prepared to provide Lloyds with a further period of 10 days, until 30 May 2025, in which to refine the policy to as to meet the two areas of concern I have identified above. Providing that those concerns are fully met, and providing the policy is in all other respects as per that provided by Ms Emerson in her fifth witness statement, I consider that it will then provide sufficient protection, and that, in my discretion, Lloyds is entitled to rely upon it for the purposes of providing Accor with further security for costs presently sought by Accord. This should extend to the £75,000 of security agreed in respect of the amendment (which was paid subject to substitution with an ATE policy if it is found to be acceptable), and the security of £600,000 which has been ordered but not yet been paid into Court. For the avoidance of doubt, although Ms Emerson intimates in her third witness statement that after placing the insurance, Lloyds will make an application for the money previously paid into Court to be released back to Lloyds, there is no such application before me. Mr Webb KC’s skeleton argument specifically reserves the right to make such an application. At present, there is no evidence before me that there is material change of circumstances or other factors such as a particular hardship or difficulty caused by the status quo in respect of the existing orders which warrants payment out of the sums already paid into Court, as opposed merely to entitlement to satisfy further payments yet to be made by way of ATE insurance (see Recovery, cited above).

If the parties cannot agree within 17 days, by 6 June 2025, whether any revised policy provided by Lloyds satisfactorily meets the concerns identified (having properly communicated with each other to discuss the nature of any ongoing concerns), I will decide the matter, preferably by way of written submissions (although the parties have the right to request a short oral hearing).