Young and Others -v- Haden and Others [2016] JRC 089D (28 April 2016)

Young and Others -v- Haden and Others [2016] JRC 089D (28 April 2016)

Security for costs can be ordered against the second to fifth defendant companies in respect of their counterclaim because the counterclaim is substantive, the companies are balance sheet insolvent, and insufficient financial information was provided to show that an order would probably stifle the counterclaim. The presence of the first defendant as a Jersey resident does not preclude such an order. The appropriate amount of security, balancing injustice to both parties, is £50,000.

Citation
[2016] JRC 089D
Parties
Plaintiff: Plaintiffs (names not specified); Defendant: First Defendant (Mr Haden); Defendant: Second to Fifth Defendants (Incat Group companies)
Jurisdiction
Jersey
Judgment Date
28 April 2016
Procedural Posture
Application for Security for Costs / Interlocutory Decision on Security for Costs Application
Outcome
Application for security for costs granted in part
Legal Topics
Security for Costs, Counterclaims, Professional Negligence, Jurisdiction, Corporate Insolvency
Civil Procedure Company Law Security for Costs Counterclaims Professional Negligence Jurisdiction Corporate Insolvency

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Parties

Plaintiffs (names not specified)

Plaintiff

First Defendant (Mr Haden)

Defendant

Second to Fifth Defendants (Incat Group companies)

Defendant

Procedural Posture

Application for Security for Costs / Interlocutory Decision on Security for Costs Application

Legal Issues

  1. 1 Whether security for costs can be ordered in respect of a counterclaim
  2. 2 Effect of a Jersey-resident defendant on security for costs against corporate defendants
  3. 3 Whether an order for security for costs would stifle the counterclaim given the financial position of the defendant companies

Ratio Decidendi

Security for costs can be ordered against the second to fifth defendant companies in respect of their counterclaim because the counterclaim is substantive, the companies are balance sheet insolvent, and insufficient financial information was provided to show that an order would probably stifle the counterclaim. The presence of the first defendant as a Jersey resident does not preclude such an order. The appropriate amount of security, balancing injustice to both parties, is £50,000.

Court Disposition

Application for security for costs granted in part

Orders

  • Second to fifth defendants to provide security for costs in the sum of £50,000 to the plaintiffs.