Premier Motorauctions Ltd & Anor v Pricewaterhousecoopers LLP & Anor

Premier Motorauctions Ltd & Anor v Pricewaterhousecoopers LLP & Anor

The existence and terms of the ATE insurance policies obtained by the claimants, arranged by independent joint liquidators with professional advice, do not give the court reason to believe that the claimants will be unable to pay the defendants’ costs if ordered. The risks of avoidance, rescission, or non-payment under the policies are merely theoretical on the evidence presented. The credit-worthiness of Elite is sufficient at this stage; Acasta’s position is less clear, but as its layer of cover is not immediately relevant, no order for security is made at this stage. The jurisdictional threshold under CPR 25.13 is not crossed, so the applications for security for costs are refused.

Parties
Claimant: Premier Motorauctions Limited; Claimant: Premier Motorauctions Leeds Limited (in liquidation); Defendant: PricewaterhouseCoopers LLP; Defendant: Lloyds Bank PLC
Jurisdiction
England and Wales
Judgment Date
24 October 2016
Procedural Posture
Civil / Application for Security for Costs After Close of Pleadings, First Case Management Conference
Outcome
Defendants’ applications for security for costs refused.
Legal Topics
Security for Costs, After the Event (ate) Insurance, Jurisdictional Threshold Under CPR 25.13, Insolvent Claimants, Credit Worthiness of Insurers
Civil Procedure Insolvency Insurance Security for Costs After the Event (ate) Insurance Jurisdictional Threshold Under CPR 25.13 Insolvent Claimants Credit Worthiness of Insurers

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Parties

Premier Motorauctions Limited

Claimant

Premier Motorauctions Leeds Limited (in liquidation)

Claimant

PricewaterhouseCoopers LLP

Defendant

Lloyds Bank PLC

Defendant

Procedural Posture

Civil / Application for Security for Costs After Close of Pleadings, First Case Management Conference

Legal Issues

  1. 1 Whether ATE insurance policies obtained by insolvent claimants displace the jurisdictional threshold for security for costs under CPR 25.13
  2. 2 Whether there is reason to believe the claimants will be unable to pay the defendants’ costs if ordered to do so, given the existence and terms of ATE insurance
  3. 3 Whether the credit-worthiness of Gibraltar-based insurers affects the adequacy of security

Ratio Decidendi

The existence and terms of the ATE insurance policies obtained by the claimants, arranged by independent joint liquidators with professional advice, do not give the court reason to believe that the claimants will be unable to pay the defendants’ costs if ordered. The risks of avoidance, rescission, or non-payment under the policies are merely theoretical on the evidence presented. The credit-worthiness of Elite is sufficient at this stage; Acasta’s position is less clear, but as its layer of cover is not immediately relevant, no order for security is made at this stage. The jurisdictional threshold under CPR 25.13 is not crossed, so the applications for security for costs are refused.

Court Disposition

Defendants’ applications for security for costs refused.

Orders

  • Defendants’ applications for security for costs are dismissed.
  • Defendants have liberty to apply as the case progresses if circumstances materially change.