Unit 16 - Security for Costs and Interim Payments Flashcards Preview

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Flashcards in Unit 16 - Security for Costs and Interim Payments Deck (82)
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TRUE or FALSE. When the court determines a summary judgment application it may give directions as to the filing and service of a defence.

TRUE. CPR 24.6


TRUE or FALSE. When the court determines a summary judgment application it may give further directions about the management of the case.

TRUE. CPR 24.6


When will a court make a conditional order in respect of a claim/issue in defence?

Where it is possible that it will succeed but improbabe.


24PD defines conditional order as orders requiring parties to

Pay a sum of money into court;

Take a specified step in relation to his claim/defence as the case may be, and which provides that it will be dismissed/struck out if he does not comply.


What is the purpose of conditional orders for payment in summary judgment applications

To provide security in respect of a particularly weak defence.


Gama Aviation establishes five principles for considerations of conditional orders for payment into court in summary judgments:

1. Do not impose conditions which are likely impossible for D to comply with.

2. BoP is on D to show that he is unable to comply

3. To discharge burden, D must show a lack of funds and that no such funds could be accessible.

4. Not incumbent on D to adduce evidence of resources, especially where there is no prior notice of a conditional order

5. Court not limitedto case where defence is improbable to suceed. Can also apply for historic failures to comply, doubts about good faith.


C cannot apply for an order for interim payment before...

...th end of the period for filing an AoS applicable to the defendant.


How many applications can C make for orders for interim payments.

More than one.


How long before hearing must copies of notices for interim payment orders be made?

What must they be supported by?

At least 14 days.



If respondent to interim payment order app wants to rely on written evidence, he must:

File the written evidence;

Serve copies on every other party at least 7 days before hearing.


If applicant for interim payment order wants to rely on written evidence in reply to R, he must:

File the written evidence;

Serve a copy on R at least 3 days before the hearing.


TRUE or FALSE. Interim payments can only be ordered in lump sums.

FALSE. Can be in lump sums or instalments.


What are the conditions, of which one must be present, for the court to make an order for interim payment?

D admits liability to pay damages or some sum of money to C;

C has obtained judgment against D for damages/sum of money to be assessed;

Satisfied that, if it goes to trial, C would obtain judgment for a substantial amount against D

C is seeking order for possession of land and court is satisfied that, at trial, D would be liable to pay C a sum of money for their occupation/use of land while claim was pending;

Where there are two or more D and order is against any one or more, court is satisfied that C would obtain judgment for substantial amount of money against one or more and all Ds are insured or covered by insurer under s151 RTA/Motor Insurers Bureau or D is a public body.


TRUE or FALSE. courts can order interim payments that are an unreasonable proportion of the likely amount of final judgment.

FALSE. Must be reasonable proportion at most.


TRUE or FALSE. Court must take into account contributory negligence re interim payment orders.



TRUE or FALSE. Court must take into account any relevant set-off or counterclaim in interm payment orders.



What orders can court make to adjust interim payments?

Order all/part to be repaid;

Vary or discharge the order

Order D to reimburse another D who made an interim payment, but only if D has a claim for contribution/indemnity and the circumstances are suhc that court could make an order for interim payment under 25.7


TRUE or FALSE. Courts can make orders to adjust without applications IF it makes the order when it disposes of the claim or any part of it.



Where D makes an interim payment and the amount of payment is more than his total liability under the final judgment, the court may...

...award him interest on the overpaid amount from the date when he made the interim payment.


TRUE or FALSE. The fact that D has made an interim payment must be disclosed to the trial judge before all questions of liability/money owed have been agreed.

No - it must NOT be disclosed unless D agrees.


TRUE or FALSE. Applications for security of costs must be supported by written evidence.



When the court makes an order for security of costs, it will...

Determine the amount of security;

Direct the manner in which and the time within which the security must be given.


The court can make orders for security for costs if

Satisfied that it is just to make such an order AND an enactment permits them to do so OR one of the following conditions applies:

1. C is resident out of jurisdiction but not residing in Brussels Contracting State/Lugano Convention state/Hague Convention or Regulation State

2. C is a company or other body and there is a reason to believe that it will be unable to pay D's costs if ordered to do so;

3. C has changed address sine claim was commenced with a view to evading consequences of litigation

4. C is acting as a nominal claimant(other than rep C undewr Part 19) and there is reason to believe that he will be unable to pay D's costs if ordered to do so.

5. C has taken steps in relation to his assets that would make it difficult to enforce an order for costs agaisnt him.


TRUE or FALSE. Security for costs can be ordered if one of the conditions in r25.13(2) applies.

FALSE. Must also have regard to all the circumstances of the case, such that it is just to make the order.


TRUE or FALSE. A defendant should not be adversely affected in seeking security merely because they ahve attempted to reach a settlement previously.



Where C claims that an order for security will stifle the claim, who bears burden of proof?

C bears burden of proof of showing this to be the case, on the balance of probabilities.

C must show that it cannot provide security and cannot obtain appropriate assistance to do so.


TRUE or FALSE. D must show, on the balance of probabilities, that the claimant company will be unable to pay, as a basis for ordering security for costs.

FALSE. The opening words are "there is reason to believe" which waters down the obligation.


When considering the insolvency of a company as a basis to order costs, must the court consider future events?

Yes - the question is an assessment of what the company may be expected to have available for payment at that time.


TRUE or FALSE. A liquidator bringing proceedings in the name of an insolvent company is under a duty to ensure that the company has sufficient funds to pay any costs awarded to the defendant.



What factors must court consider re ordering security for costs against insolvent company? (7)

Is C's claim in good faith?

Does C have a reasonably good prospect of success?

Is there an admission by D in their defence that money is due?

Is there a substantial payment into court?

Is the application for security being used oppressively?

Has C's want of means been brought about by the conduct of D?

Was the application for security made at a late stage in proceedings?