Peak Hotels And Resorts Ltd v Tarek Investments Ltd [2015] EWHC 386 (Ch) (20 February 2015)

Peak Hotels And Resorts Ltd v Tarek Investments Ltd [2015] EWHC 386 (Ch) (20 February 2015)

The evidence demonstrates reason to believe that the claimant will be unable to pay the defendants' costs if ordered to do so, due to lack of unencumbered assets, asset dissipation, and unreliable financial evidence. It is just to order security for costs against the claimant. The claimant's application for security against the first defendant fails because, if successful, it can set off its costs against the purchase price of the defendant's shares, so there is no reason to believe the defendant will be unable to pay.

Citation
[2015] EWHC 386 (Ch)
Parties
Claimant: Peak Hotels and Resorts Limited; First Defendant: Tarek Investments Limited; Second Defendant: Peak Hotels and Resorts Group Limited; Third Defendant: Sherway Group Limited; Fourth Defendant: Carl Johan Eliasch; First Named Third Party: PHRL Holdings Limited; Second Named Third Party: Mr Omar Sharif Amanat; Fourth Party: Mr Lalit Modi
Jurisdiction
England and Wales
Judgment Date
20 February 2015
Procedural Posture
Civil (chancery Division) / Interlocutory Application for Security for Costs
Outcome
Applications for security for costs by the first, third, and fourth defendants against the claimant are granted; the claimant's cross-application for security against the first defendant is refused.
Legal Topics
Security for Costs, Corporate Insolvency, Enforcement of Costs Orders, Shareholder Disputes
Civil Procedure Company Law Security for Costs Corporate Insolvency Enforcement of Costs Orders Shareholder Disputes

Case Brief

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Parties

Peak Hotels and Resorts Limited

Claimant

Tarek Investments Limited

First Defendant

Peak Hotels and Resorts Group Limited

Second Defendant

Sherway Group Limited

Third Defendant

Carl Johan Eliasch

Fourth Defendant

PHRL Holdings Limited

First Named Third Party

Mr Omar Sharif Amanat

Second Named Third Party

Mr Lalit Modi

Fourth Party

Procedural Posture

Civil (chancery Division) / Interlocutory Application for Security for Costs

Legal Issues

  1. 1 Whether the defendants are entitled to security for costs against the claimant under CPR 25.13(2)(a), (c), and (g)
  2. 2 Whether the claimant is entitled to security for costs against the first defendant under CPR 25.13(2)(c)

Ratio Decidendi

The evidence demonstrates reason to believe that the claimant will be unable to pay the defendants' costs if ordered to do so, due to lack of unencumbered assets, asset dissipation, and unreliable financial evidence. It is just to order security for costs against the claimant. The claimant's application for security against the first defendant fails because, if successful, it can set off its costs against the purchase price of the defendant's shares, so there is no reason to believe the defendant will be unable to pay.

Court Disposition

Applications for security for costs by the first, third, and fourth defendants against the claimant are granted; the claimant's cross-application for security against the first defendant is refused.

Orders

  • Claimant to provide security for costs to the first, third, and fourth defendants in amounts to be determined.
  • Claimant's application for security for costs against the first defendant is dismissed.