Parsdome Holdings Limited v Plastic Energy Global SL
[2023] EWHC 2851 (Comm)
Dr Morteza Rajabieslami v Sam Tariverdi & Ors
6 March 2023
[2023] EWHC 455 (Comm)
High Court
A company sued a man living abroad. The company worried it couldn't get its money back if it lost the case. The judge agreed that there was a real chance the company wouldn't get its money, so the man had to put some money aside to cover the company's legal costs, just in case.
Key Facts
- •Defendants applied for security for costs against the Claimant, an Iranian national resident in Qatar.
- •Claimant's claim alleges theft and sale of a vessel by the first defendant, who is an Iranian national resident in England and Greece.
- •Defendants' defense claims the declaration of trust is a forgery and the shares were transferred as consideration for a domestic transaction in Iran involving carpet sales.
- •Claimant's address on the claim form was that of his business, raising questions about its correctness.
- •The claimant's assets are primarily shares in various companies, potentially making enforcement of a costs order difficult.
- •The application for security for costs relied on CPR Part 25.13(2)(a), (e), and (g).
- •Late service of evidence by the claimant complicated the proceedings.
Legal Principles
Court's power to order security for costs under CPR 25.12 is contingent on one or more conditions in CPR 25.13(2) being met.
CPR Part 25.13(2)
For gateway (a) (claimant resident outside the jurisdiction but not in a state bound by the 2005 Hague Convention), objectively justified grounds relating to obstacles to or the burden of enforcement must exist.
Danilina v Chernukhin [2019] 1 WLR 758
Merits of the case are only relevant to a security for costs application if it can be clearly and shortly demonstrated that one party is very likely to succeed.
Commercial Court Guide, Appendix 10, paragraph 4
In considering gateway (g) (claimant taking steps to make enforcement difficult), the test is objective, with no temporal limitation on when the steps were taken.
Ackerman v Ackerman [2011] EWHC 2183 (Ch)
Enforcement of foreign judgments in Qatar requires proof of reciprocity, potentially posing obstacles to enforcement of a UK costs order.
Article 379, Qatari Civil and Commercial Procedural Code; Lexology and Juris Arbitration Law articles
English courts would enforce a final and conclusive Qatari money judgment, subject to usual rules and exceptions.
Rule 46(1), Dicey, Morris and Collins on the Conflict of Laws (16th edn)
Outcomes
Defendants' application for security for costs was granted.
Gateway (a) was satisfied due to a real risk of serious obstacles to enforcing a costs order in Qatar. While the claimant had assets in the UAE, the court found insufficient evidence of the value or ease of enforcement of those assets. The court did not find the merits of the underlying case sufficiently clear to outweigh the risk of enforcement difficulties.
Security for costs ordered in the sum of GBP 203,298, covering costs up to the expert evidence stage.
This amount reflects the relevant portion of the defendants' approved costs budget.
Defendants awarded costs of the application, summarily assessed at GBP 60,000.
Defendants succeeded in their application.
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