Infinity Distribution Ltd v The Khan Partnership LLP

Infinity Distribution Ltd v The Khan Partnership LLP

The potential recoverability of the ATE insurance premium from the defendant is a material and relevant consideration when the court determines the manner in which security for costs is to be provided. Where the choice is between a deed of indemnity (which may expose the defendant to a substantial additional costs liability if the claimant succeeds) and payment into court (which does not), and there is no evidence that payment into court would stifle the claim, security should be ordered by payment into court.

Parties
Claimant/respondent: Infinity Distribution Ltd (in administration); Defendant/appellant: The Khan Partnership LLP
Jurisdiction
England and Wales
Judgment Date
20 April 2021
Procedural Posture
Civil Appeal / Second Appeal From High Court Decision on Security for Costs
Outcome
Appeal allowed
Legal Topics
Security for Costs, After the Event (ate) Insurance, Recoverability of Insurance Premiums, Discretion in Procedural Orders
Civil Procedure Costs Security for Costs After the Event (ate) Insurance Recoverability of Insurance Premiums Discretion in Procedural Orders

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Parties

Infinity Distribution Ltd (in administration)

Claimant/respondent

The Khan Partnership LLP

Defendant/appellant

Procedural Posture

Civil Appeal / Second Appeal From High Court Decision on Security for Costs

Legal Issues

  1. 1 Whether the potential recoverability of an ATE insurance premium by the defendant is a relevant consideration when determining the form of security for costs
  2. 2 Whether security for costs should be provided by deed of indemnity or payment into court

Ratio Decidendi

The potential recoverability of the ATE insurance premium from the defendant is a material and relevant consideration when the court determines the manner in which security for costs is to be provided. Where the choice is between a deed of indemnity (which may expose the defendant to a substantial additional costs liability if the claimant succeeds) and payment into court (which does not), and there is no evidence that payment into court would stifle the claim, security should be ordered by payment into court.

Court Disposition

Appeal allowed

Orders

  • Infinity Distribution Ltd to provide security for costs by payment into court instead of by deed of indemnity.