Arkin v Borchard Lines Ltd [2003] EWHC 2844 (Comm) (27 November 2003)

Arkin v Borchard Lines Ltd [2003] EWHC 2844 (Comm) (27 November 2003)

A non-party costs order against a professional funder is not justified solely by the existence of a funding agreement with a share of proceeds. The court must assess whether the funder had material control or influence over the litigation adverse to the administration of justice. In this case, MPC's agreement and conduct did not give rise to such control or risk, as all substantive decisions were made by the claimant's legal team, and leading counsel's advice prevailed in case of disagreement. Therefore, no costs order should be made against MPC.

Citation
[2003] EWHC 2844 (Comm)
Parties
Claimant: Yeshekel Arkin; 1st Defendant: Borchard Lines Limited; 2nd to 4th Defendants: Zim Israel Navigation Company Ltd & Ors; 11th Part 20 Defendants: Managers and Processors of Claims (MPC); 3rd and 5th Part 20 Defendants: 3rd and 5th Part 20 Defendants; 1st and 6th Part 20 Defendant: 1st and 6th Part 20 Defendant
Jurisdiction
England and Wales
Judgment Date
27 November 2003
Procedural Posture
Commercial Court Application for Non Party Costs Order / Post Trial Costs Application
Outcome
Application for costs order against MPC dismissed
Legal Topics
Non Party Costs Orders, Conditional Fee Agreements, Access to Justice, Champerty and Maintenance, Litigation Funding Arrangements
Civil Procedure Litigation Funding Costs Non Party Costs Orders Conditional Fee Agreements Access to Justice Champerty and Maintenance Litigation Funding Arrangements

Case Brief

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Parties

Yeshekel Arkin

Claimant

Borchard Lines Limited

1st Defendant

Zim Israel Navigation Company Ltd & Ors

2nd to 4th Defendants

Managers and Processors of Claims (MPC)

11th Part 20 Defendants

3rd and 5th Part 20 Defendants

3rd and 5th Part 20 Defendants

1st and 6th Part 20 Defendant

1st and 6th Part 20 Defendant

Procedural Posture

Commercial Court Application for Non Party Costs Order / Post Trial Costs Application

Legal Issues

  1. 1 Whether a professional litigation funder (MPC) should be liable for the defendants' costs after the claimant's failure
  2. 2 Whether the terms and conduct of the funding agreement justify a non-party costs order against MPC

Ratio Decidendi

A non-party costs order against a professional funder is not justified solely by the existence of a funding agreement with a share of proceeds. The court must assess whether the funder had material control or influence over the litigation adverse to the administration of justice. In this case, MPC's agreement and conduct did not give rise to such control or risk, as all substantive decisions were made by the claimant's legal team, and leading counsel's advice prevailed in case of disagreement. Therefore, no costs order should be made against MPC.

Court Disposition

Application for costs order against MPC dismissed

Orders

  • No order for costs against Managers and Processors of Claims (MPC)
  • Costs to be borne as previously ordered between the principal parties