Saxon Woods Investments Ltd v Costa & Ors [2023] EWHC 850 (Ch) (20 April 2023)

Saxon Woods Investments Ltd v Costa & Ors [2023] EWHC 850 (Ch) (20 April 2023)

There was a material change of circumstances because the Petitioner was unable to obtain and present the anti-avoidance endorsement at the original hearing due to the late service of serious new allegations by the First Respondent. The ATE policy with the anti-avoidance endorsement, as now agreed in principle, provides sufficient protection for the First Respondent's costs, as its terms restrict insurer avoidance and allow direct enforcement by the Respondent. The court is satisfied that the risk of insurer avoidance is not real or substantial in the context of the pleaded case and the policy wording.

Citation
[2023] EWHC 850 (Ch)
Parties
Petitioner: Saxon Woods Investments Limited; First Respondent: Francesco Costa; Second Respondent: Far East Media Holdings Pte Limited; Third Respondent: Grosvenor Investment Project Limited; Fourth Respondent: HDO Holding Limited; Fifth Respondent: Bay Capital Investments Limited; Sixth Respondent: Khattar Holdings Private Limited; Seventh Respondent: Simon Powell; Eighth Respondent: Spring Media Investments Limited
Jurisdiction
England and Wales
Judgment Date
20 April 2023
Procedural Posture
Company/shareholder Dispute / Application to Vary Security for Costs Order
Outcome
Application granted
Legal Topics
Security for Costs, ATE Insurance, Anti Avoidance Endorsement, Variation of Court Orders, Shareholder Disputes
Company Law Civil Procedure Insurance Law Security for Costs ATE Insurance Anti Avoidance Endorsement Variation of Court Orders Shareholder Disputes

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Parties

Saxon Woods Investments Limited

Petitioner

Francesco Costa

First Respondent

Far East Media Holdings Pte Limited

Second Respondent

Grosvenor Investment Project Limited

Third Respondent

HDO Holding Limited

Fourth Respondent

Bay Capital Investments Limited

Fifth Respondent

Khattar Holdings Private Limited

Sixth Respondent

Simon Powell

Seventh Respondent

Spring Media Investments Limited

Eighth Respondent

Procedural Posture

Company/shareholder Dispute / Application to Vary Security for Costs Order

Legal Issues

  1. 1 Whether a material change of circumstances justifies varying a security for costs order to substitute an ATE policy with anti-avoidance endorsement for a cash payment
  2. 2 Whether the ATE policy and anti-avoidance endorsement provide sufficient protection to the respondent against the risk of insurer avoidance, particularly for fraud or non-disclosure

Ratio Decidendi

There was a material change of circumstances because the Petitioner was unable to obtain and present the anti-avoidance endorsement at the original hearing due to the late service of serious new allegations by the First Respondent. The ATE policy with the anti-avoidance endorsement, as now agreed in principle, provides sufficient protection for the First Respondent's costs, as its terms restrict insurer avoidance and allow direct enforcement by the Respondent. The court is satisfied that the risk of insurer avoidance is not real or substantial in the context of the pleaded case and the policy wording.

Court Disposition

Application granted

Orders

  • The order of 9 December 2022 requiring the Petitioner to pay £1,348,910 into court as security for costs is varied.
  • The Petitioner may provide security for the First Respondent's costs by way of the ATE insurance policy with the agreed anti-avoidance endorsement in substitution for the cash payment.