Shetland Seafarms Ltd In The Cause Of Assuranceforeningen Skuld v International Oil Pollution Compensation Fund & Ors [2000] ScotCS 158 (9 June 2000)

Shetland Seafarms Ltd In The Cause Of Assuranceforeningen Skuld v International Oil Pollution Compensation Fund & Ors [2000] ScotCS 158 (9 June 2000)

Section 726(2) Companies Act 1985 applies to the claimant as the substantive pursuer in these proceedings, regardless of formal designation. The claimant's financial position justifies an order for caution to protect the objectors from irrecoverable expenses. The cause of the claimant's financial state is not a sufficient reason to refuse caution.

Citation
[2000] ScotCS 158
Parties
Claimant: Shetland Seafarms Limited; Pursuer: Assuranceforeningen Skuld; Defender/objector: The International Oil Pollution Compensation Fund; Objector: James L R Robb; Objector: Brian Robb; Objector: Alexander Eunson
Jurisdiction
Scotland
Judgment Date
09 June 2000
Procedural Posture
Motion for Caution (security for Expenses) Under Section 726(2) Companies Act 1985 in Limitation Proceedings / Interlocutory (preliminary Proof Ordered on Alleged Fraud, Motion for Caution Determined)
Outcome
Motions for caution granted; claimant ordered to find caution of £20,000 in each case.
Legal Topics
Security for Expenses, Interpretation of 'pursuer' Under Companies Act 1985 S726(2), Limitation Proceedings, Corporate Insolvency Risk
Company Law Civil Procedure Security for Expenses Interpretation of 'pursuer' Under Companies Act 1985 S726(2) Limitation Proceedings Corporate Insolvency Risk

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Parties

Shetland Seafarms Limited

Claimant

Assuranceforeningen Skuld

Pursuer

The International Oil Pollution Compensation Fund

Defender/objector

James L R Robb

Objector

Brian Robb

Objector

Alexander Eunson

Objector

Procedural Posture

Motion for Caution (security for Expenses) Under Section 726(2) Companies Act 1985 in Limitation Proceedings / Interlocutory (preliminary Proof Ordered on Alleged Fraud, Motion for Caution Determined)

Legal Issues

  1. 1 Whether section 726(2) Companies Act 1985 applies to a claimant not formally designated as 'pursuer' in limitation proceedings
  2. 2 Whether the claimant's financial position justifies an order for caution (security for expenses)
  3. 3 Whether the claimant's financial state is a consequence of the incident giving rise to the claim and if that is relevant to the discretion to order caution

Ratio Decidendi

Section 726(2) Companies Act 1985 applies to the claimant as the substantive pursuer in these proceedings, regardless of formal designation. The claimant's financial position justifies an order for caution to protect the objectors from irrecoverable expenses. The cause of the claimant's financial state is not a sufficient reason to refuse caution.

Court Disposition

Motions for caution granted; claimant ordered to find caution of £20,000 in each case.

Orders

  • Claimant to find caution of £20,000 in respect of each objector's expenses under section 726(2) Companies Act 1985.
  • No time limit imposed for finding caution, but 28 days suggested as reasonable.