Pannone LLP v Aardvark Digital Ltd

Pannone LLP v Aardvark Digital Ltd

An order for security for costs in any substantial amount would stifle the Defendant's Counterclaim, infringing its right of access to the court under Article 6 ECHR. The Counterclaim is an independent claim, not merely a defence. It is not just to order security for costs in circumstances where the Defendant cannot comply and the claim would be stifled. The appeal is allowed and the order for security is set aside.

Parties
Claimant/respondent: Pannone LLP; Defendant/appellant: Aardvark Digital Limited
Jurisdiction
England and Wales
Judgment Date
26 March 2013
Procedural Posture
Appeal / Judgment on Appeal Against Order for Security for Costs
Outcome
Appeal allowed; order for security for costs set aside.
Legal Topics
Security for Costs, Counterclaims, Access to Justice, Human Rights (article 6), Professional Negligence, Costs Orders
Civil Procedure Professional Negligence Security for Costs Counterclaims Access to Justice Human Rights (article 6) Costs Orders

Case Brief

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Parties

Pannone LLP

Claimant/respondent

Aardvark Digital Limited

Defendant/appellant

Procedural Posture

Appeal / Judgment on Appeal Against Order for Security for Costs

Legal Issues

  1. 1 Whether it is just to order security for costs in relation to a counterclaim where the defendant is impecunious
  2. 2 Whether the counterclaim crosses the boundary between an aggressive defence and an independent claim
  3. 3 Whether an order for security would stifle the counterclaim and infringe Article 6 rights

Ratio Decidendi

An order for security for costs in any substantial amount would stifle the Defendant's Counterclaim, infringing its right of access to the court under Article 6 ECHR. The Counterclaim is an independent claim, not merely a defence. It is not just to order security for costs in circumstances where the Defendant cannot comply and the claim would be stifled. The appeal is allowed and the order for security is set aside.

Court Disposition

Appeal allowed; order for security for costs set aside.

Orders

  • Order for security for costs made by the District Judge is set aside.
  • Case to be closely case-managed to ensure economic and reasonable conduct.