Premier Motorauctions Ltd & Anor v Pricewaterhousecoopers LLP & Anor [2017] EWCA Civ 1872 (23 November 2017)

Premier Motorauctions Ltd & Anor v Pricewaterhousecoopers LLP & Anor [2017] EWCA Civ 1872 (23 November 2017)

ATE insurance policies lacking anti-avoidance provisions do not provide sufficient protection to defendants to preclude an order for security for costs under CPR 25.13, as there is reason to believe the claimant company may be unable to pay the defendants' costs if ordered to do so. The existence of such policies does not remove the court's jurisdiction to order security for costs.

Citation
[2017] EWCA Civ 1872
Parties
Respondent/claimant: Premier Motorauctions Ltd (in liquidation); Respondent/claimant: Premier Motorauctions; Appellant/defendant: PricewaterhouseCoopers LLP; Appellant/defendant: Lloyds Bank PLC
Jurisdiction
England and Wales
Judgment Date
23 November 2017
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal
Outcome
Appeal allowed; security for costs ordered against claimants.
Legal Topics
Security for Costs, After the Event (ate) Insurance, Jurisdiction Under CPR 25.13, Company Insolvency, Costs Orders
Civil Procedure Insolvency Insurance Law Security for Costs After the Event (ate) Insurance Jurisdiction Under CPR 25.13 Company Insolvency Costs Orders

Case Brief

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Parties

Premier Motorauctions Ltd (in liquidation)

Respondent/claimant

Premier Motorauctions

Respondent/claimant

PricewaterhouseCoopers LLP

Appellant/defendant

Lloyds Bank PLC

Appellant/defendant

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal

Legal Issues

  1. 1 Whether ATE insurance without anti-avoidance provisions constitutes adequate security for costs for an insolvent claimant company under CPR 25.13
  2. 2 Whether the existence of ATE insurance should be considered at the jurisdictional stage of a security for costs application
  3. 3 Whether the terms of the ATE policy provide sufficient protection to defendants against the risk of non-payment of costs

Ratio Decidendi

ATE insurance policies lacking anti-avoidance provisions do not provide sufficient protection to defendants to preclude an order for security for costs under CPR 25.13, as there is reason to believe the claimant company may be unable to pay the defendants' costs if ordered to do so. The existence of such policies does not remove the court's jurisdiction to order security for costs.

Court Disposition

Appeal allowed; security for costs ordered against claimants.

Orders

  • Appeals allowed.
  • Order of 2 December 2016 set aside and substituted.