Paper Mache Tiger Limited v Lee Mathews Workroom Pty Ltd (in Liquidation)
[2023] EWHC 338 (Comm)
Kindertons Limited v Georgina Murtagh & Anor
5 March 2024
[2024] EWHC 471 (KB)
High Court
A car accident led to a lawsuit where the credit hire company (Kindertons) profited if the claimant won. The claimant lied, losing the case. The insurer (Esure) sued Kindertons for their legal costs, and the court said Kindertons should pay because they benefited from the lawsuit and controlled how it was handled.
Key Facts
- •Appeal against a non-party costs order (NPCO) made against Kindertons Limited (Kindertons) in favour of Esure Services Limited (Esure).
- •The underlying case involved a minor car accident where the claimant, Mr. Ibrahim, engaged Kindertons for credit hire and repair services.
- •The Recorder found Mr. Ibrahim's claims to be fundamentally dishonest, leading to the dismissal of his claim and a costs order against him.
- •Esure sought and obtained a NPCO against Kindertons, arguing that Kindertons benefitted financially from the litigation.
- •Kindertons appealed the NPCO, raising several grounds of appeal.
Legal Principles
The court has full power to determine by whom and to what extent costs are to be paid.
Section 51(3) Senior Courts Act 1981
In QOCS cases, an NPCO may be made against a person for whose financial benefit a claim was made.
CPR 44.16(2)(a), CPR 44 PD 12.2
CPR 44.16 does not introduce a distinct discretion for non-party costs in QOCS cases; the approach is consistent with existing case law.
Select Car Rentals (North West) Ltd v Esure Services Ltd [2017] 1 W.L.R. 4426
Causation is often a vital factor in NPCOs, but not always a necessary precondition; justice is paramount.
Total Spares v Antares [2006] EWHC 1537 (Ch), Turvill v Bird [2016] EWCA Civ 703
The degree of control exercised by a non-party is relevant to the decision to make a NPCO.
Deutsche Bank AG v Sebastian Holdings [2016] 4 W.L.R. 17
The court must consider whether a term is fair even if not raised by parties.
Section 71(2) Consumer Rights Act 2015
Outcomes
Appeal dismissed.
The court found that Kindertons had a strong financial stake in the litigation, exercised significant control over it, and that it was just to make the NPCO, regardless of whether causation could be established on a strict ‘but for’ basis.