Jersey Unreported Judgments

Fraud - costs judgment.

[2012]JCA160

Court of Appeal

7 September 2012

	Before     :		J. W. McNeill, Q.C., sitting as a single Judge.
Between		(1) The Federal Republic of Brazil		RESPONDENTS/ Plaintiffs
		(2) The Municipality of Sao Paulo
And		(1) Durant International Corporation		APPLICANTS/ Defendants
		(2) Kildare Finance Limited
And		(1) Deutsche Bank International Limited		Parties Cited
		(2) Deutsche International Custodial Services Limited
		(3) Deutsche International Corporate Services Limited
		(4) Deutsche International Trustee Services (CI) Limited

Application for costs.

Advocate D. S. Steenson for the Applicants.

Advocate E. L. Jordan for the Respondents.

JUDGMENT

MCNEILL JA:

1.        The plaintiffs and respondents apply for costs on an indemnity basis of and incidental to both the application for leave to appeal by the defendants against the decision of Commissioner Page dated 4 July 2012 and also the application for leave to adduce fresh evidence, both of which I determined on 22 August.  In the alternative, were this court not minded to award indemnity costs, the respondents seek costs of and incidental to the applications on the standard basis. 

2.        The grounds for considering the making of an award of indemnity costs were most recently considered by this court in Leeds v Weston and Levi [2012] JCA 088.  In reviewing earlier decisions of this court Jones J.A noted that there had to be some special or unusual feature justifying such an award such as culpability, abuse of process, deceit, unreasonable behaviour, abuse of court procedures or the submission of unnecessary evidence;  but not necessarily a lack of moral probity, malice or vexatious conduct.  

3.        In the present matter the Defendants and Applicants do not oppose the application for indemnity costs.  However, as the matter is one within the discretion of the court and as the step is an unusual one, the application requires consideration. 

4.        On behalf of the respondents, Advocates Baker and Jordan submitted that the following issues brought the conduct of applicants to the realm which justified an order for indemnity costs.  First, the learned Commissioner had already found the applicants' conduct in relation to the present chapter of proceedings to be unreasonable and had given reasons in his judgment of 4 July 2012.  The application before this court arose from an application which had already been deemed to be so unreasonable by the learned Commissioner as to be deserving of an indemnity costs award below.  Second, in relation to the application for leave to adduce fresh evidence, there had been no attempt in the applicants' written submissions to explain why the evidence could not have been obtained prior to the hearing before the Commissioner.  Third it was plain that the learned Commissioner had exercised his discretion properly and that the applicants' submissions had fallen far short of indicating that something had gone wrong below.  Fourth there was a lack of explanation in the proposed application for leave to appeal which underlay the unreasonable nature of both the application at first instance and on appeal.  Fifth, although the limitation ground had been presented as a ground of appeal, it was not dealt with in any proper or meaningful way in the applicants' contentions. 

5.        Overall, the conduct and nature of the application had been wholly unreasonable and the respondents had been put to time and effort in responding to grounds of appeal which were not dealt with in a proper sense in the applicants' written contentions. 

6.        In my opinion the respondents are correct to submit that the issues which they draw to the attention of this court are such as entitle this court to consider the making of an award of costs on the indemnity basis and, in my opinion, they entitle the present respondents to such an award in respect of the applications to this Court.  It will not always follow ineluctably that a successful respondent on an application for leave to appeal and ancillary orders will be entitled to an award of costs on the indemnity basis because that has been the view of the court below against whose order an application for leave is being made.  In the present case, however, for the reasons set out in the judgment of this court on the application for leave etc., the applicants were faced with a detailed consideration of their position by the learned Commissioner; yet their contentions to this Court, in the knowledge that they had to show that something had clearly gone wrong below, indicated little more, if anything, than had been advanced below. 

7.        Applications for leave to appeal are serious matters and take up the time of Respondents, busy practitioners and Court resources.  The learned Commissioner had indicated, with clarity and precision, why he considered that the explanation presented to the court, as to why the application to amend had not been made at an earlier stage, could not be more unsatisfactory.  To suggest, as the Applicants' contentions to this Court did, that the learned Commissioner should have given the Applicants the benefit of the doubt as to the true reason for late application does nothing to begin to address the necessary issue that the court below, in day to day charge of this litigation, had clearly gone wrong.  In my opinion, the presentation of the applications to this court, unsupported by contentions of substance, constitute unreasonable behaviour in that the circumstances show that there was no properly arguable basis for the applications.  The applications should not have been made and the fair result and reasonable result in all the circumstances is that the respondents should be entitled to their costs on the indemnity basis. 

8.        This court, therefore, will order that the Defendants pay the Plaintiffs' costs of and incidental to the application for leave to appeal and the application for leave to adduce fresh evidence on the indemnity basis. 

Authorities

Leeds v Weston and Levi [2012] JCA 088.