Starting Point Recruitment Limited v Walsall Metropolitan Borough Council
[2024] EWHC 982 (Comm)
Parsdome Holdings Limited v Plastic Energy Global SL
10 November 2023
[2023] EWHC 2851 (Comm)
High Court
A company refused to show its money when asked by another company involved in a court case. The judge made the first company provide money as a guarantee in case they lose, and limited how much the second company could spend to get that guarantee.
Key Facts
- •Parsdome Holdings Limited (Claimant), a BVI company, refused to provide financial information.
- •Defendant applied for security for costs.
- •Parsdome offered incomplete evidence of potential funding sources (Blue Oil, Worth Capital, Petroleos del Sur, Mr. Rojas).
- •Defendant sought £343,000 security (70% of incurred costs).
- •Claimant argued for 60% (£294,000).
- •The court considered the prejudice to both parties and the reasonableness of costs incurred.
Legal Principles
Security for costs can be ordered if there is reason to believe the claimant cannot pay the defendant's costs if they lose.
Court judgment
Security should be substantially equivalent to cash in court or a first-class bank guarantee.
Court judgment
The court errs on the side of the successful applicant for security for costs.
Court judgment and authorities cited
Costs should be reasonable and proportionate.
Court judgment
Outcomes
Order for security for costs of £343,000 granted.
The court found that Parsdome's evidence of potential funding was insufficient to meet the usual standard for security, and the potential prejudice to the defendant from under-securing costs outweighed the potential prejudice to the claimant from the order.
Defendant's recoverable costs summarily assessed at £40,000.
The court deemed the defendant's costs of £100,000+ for the application unreasonable and disproportionate given its straightforward nature.