Frank & Anor v Chlorelle Construction Ltd

Frank & Anor v Chlorelle Construction Ltd

The court found that the claimants had not discharged the onus of showing inability to raise funds for security, and that the ATE insurance policy was unclear and inadequate as security. Therefore, an order for security for costs would not stifle the litigation, and a reduced security for costs was appropriate to balance the interests of both parties.

Parties
Applicant: Francesca Frank; Applicant: Richard Frank; Respondent: Chlorelle Construction Ltd (in liquidation); Respondent: Respondent Architects
Jurisdiction
England and Wales
Judgment Date
19 November 2010
Procedural Posture
Application for Security for Costs / Ruling on Application
Outcome
Application for security for costs granted in part
Legal Topics
Security for Costs, After the Event Insurance, Conditional Fee Arrangement, Liquidation, Proportionality of Costs
Civil Procedure Insolvency Construction Law Security for Costs After the Event Insurance Conditional Fee Arrangement Liquidation Proportionality of Costs

Case Brief

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Parties

Francesca Frank

Applicant

Richard Frank

Applicant

Chlorelle Construction Ltd (in liquidation)

Respondent

Respondent Architects

Respondent

Procedural Posture

Application for Security for Costs / Ruling on Application

Legal Issues

  1. 1 Whether an order for security for costs would oppressively stifle litigation
  2. 2 Adequacy of After the Event insurance as security
  3. 3 Ability of claimants to raise funds for security

Ratio Decidendi

The court found that the claimants had not discharged the onus of showing inability to raise funds for security, and that the ATE insurance policy was unclear and inadequate as security. Therefore, an order for security for costs would not stifle the litigation, and a reduced security for costs was appropriate to balance the interests of both parties.

Court Disposition

Application for security for costs granted in part

Orders

  • Claimants to provide security for costs in the sum of £100,000 within 12 weeks
  • Action stayed for 12 weeks pending payment of security