New Tasty Bakery Ltd v Ma Enterprise (UK) Ltd
| Jurisdiction | England & Wales |
| Judge | Judge Hacon |
| Judgment Date | 13 April 2016 |
| Neutral Citation | [2016] EWHC 1038 (IPEC) |
| Court | Intellectual Property Enterprise Court |
| Docket Number | Case No: IP-2014000038 |
| Date | 13 April 2016 |
[2016] EWHC 1038 (IPEC)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
INTELLECTUAL PROPERTY ENTERPRISE COURT
The Rolls Building
7 Rolls Buildings
Fetter Lane
London EC4A 1NL
His Honour Judge Hacon
Case No: IP-2014000038
Mr M Engelman appeared on behalf of the Claimant
Miss J Reid appeared on behalf of the Defendant
(As Approved)
This is an application for security for costs made by the defendant pursuant to CPR 25.13(2)(c); that is to say, the defendant says that "the claimant is a company or other body … and there is reason to believe that it will be unable to pay the defendant's costs if ordered to do so".
The main evidence I have as to whether there is reason to believe that the claimant would be unable to pay costs comes from the accounts of the claimant for the year ended 31 March 2015, which show that although the company appears to be trading at a modest profit of about £38,000, it has what are identified as "creditors", with amounts falling due after more than one year, in the sum of £478,661. On the face of that, it appears that the company is, potentially anyway, insolvent, and certainly has financial difficulties. The claimant attempts to deal with this in the evidence of Mr Ismail, who is the sole director and shareholder of the claimant and who (as summarised by Mr Engelman who appears for the claimant) suggests that the £478,661 is not a sum that could ever be called in because it reflects a loss due to a fire at certain premises.
Miss Reid, who appears for the defendant, took me through earlier accounts and the notes to them, and I am satisfied that, at least to a substantial extent, Mr Engelman's characterisation of the £478,661 is not fully accurate. It is closer to reality to say that Mr Ismail himself is substantially the creditor of the company. Mr Ismail could choose, as is his right, to call in that debt at any time, in which case the claimant would financially collapse. It is fair to say therefore that there is reason to believe that the claimant would be unable to pay the defendant's costs if ordered to do so.
The obvious solution is for Mr Ismail to abandon the debt owed to him by the company but, for reasons which are entirely within his prerogative, he has chosen not to do that. Notwithstanding Mr Ismail's stance, Mr Engelman advanced a number of reasons why I should not order security for costs. There were initially several, but by the time of his oral submissions today, I think they came down to three.
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...will have the effect of stifling. The test is whether it is more likely than not”. 32 In Tasty Bakery Ltd v MA Enterprise (UK) Ltd [2016] EWHC 1038 (IPEC), another case which Mr van Heck relied on, it was held that the above meant producing evidence not only that the company did not have t......
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