Nigel Heath Sinclair (in his capacity as Enforcement Receiver of Jhalmal Singh Dhillon) (Claimant) Jhalmal Singh Dhillon (Defendant) the Drug Trafficking Act 1994 Ratanjit Sandhu and Others (Third Parties)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Haddon-Cave |
| Judgment Date | 07 December 2012 |
| Neutral Citation | [2012] EWHC 3517 (Admin) |
| Court | Queen's Bench Division (Administrative Court) |
| Docket Number | Case No: DTA NO. 30 OF 2000 |
| Date | 07 December 2012 |
[2012] EWHC 3517 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Haddon-Cave
Case No: DTA NO. 30 OF 2000
Sheena Cassidy (instructed by Mazars LLP) for the Receiver
Nicholas Fooks (instructed by Veja & Co Solicitors) for Mr and Mrs Dhillon
Lisa Freeman (instructed by Genga & Co Solicitors) for Mr and Mrs Sandhu
Hearing date: 30 th October 2012
This case raises an important issue as to whether a Receiver can recover his costs of litigation against a third party under s.51 of the Senior Courts Act 1981 and Part 69.7 of the Civil Procedure Rules 1998, or as a litigant in person.
On 30 th October 2012, I gave judgment in favour of the Receiver in this matter and made two orders. The first granting the Receiver's substantive application for a declaration that the beneficial interests in a property at 13 Avenue Gardens, Cranford, Hounslow TW5 9RF ("the Property") are such that the Defendant holds a 50% share, with the other 50% being held by Amarjit Sandhu and Ratanjit Sandhu ("Mr and Mrs Sandhu" respectively). The second granting the Receiver's possession application for permission to issue a writ for possession of the Property from Mr and Mrs Sandhu.
The Receiver in this case was appointed under the Drug Trafficking Act 1994. The background facts are set out in my earlier judgment.
I dismissed Mr Sandhu's claim to have concluded an oral agreement with Mr Dhillon entitling him to two-thirds of the Property as lacking credibility and found that Mr Sandhu had been deliberately obstructive to the Receiver.
The Receiver now invites the Court to make an order that Mr and Mrs Sandhu pay his costs both of the substantive application and his possession application (including the costs of the adjourned possession hearing which took place before Lang J on 18 th September 2012) and summarily to assess the total costs in the sum of approximately £60,000. The vast majority of the costs in the summary schedules of comprise the Receiver's own costs in attending on Mr Sandhu and his solicitors, drafting the application to court and witness statements, preparing for the court hearings and attending the court hearings.
Ms Lisa Freeman, Counsel for Mr Sandhu, submits that the Court does not have jurisdiction to order Mr Sandhu to pay the costs of the Receiver's own remuneration for bringing the applications.
Ms Sheena Cassidy, for the Receiver, submits that the Receiver's costs are recoverable because they are litigation costs. The Receiver utilised the Bar's Licensed Access Scheme to instruct Counsel directly and the costs in the summary schedules are Receiver's own costs in bringing the litigation, drafting witness statements, instructing Counsel etc. They were not merely the usual costs of managing the Receivership assets. The Receiver was, in effect, acting for himself and doing all the work which a solicitor would otherwise have done. Accordingly, Ms Cassidy submits, the Receiver's costs in so doing are properly to be regarded as litigation costs and are recoverable on one of two basis: either (a) under s.51 of the Senior Courts Act 1981 and Part 69.7 of the Civil Procedure Rules 1998, viz. Mr Sandhu as a third party is responsible for payment of the Receiver's costs connected with these proceedings; or (b) alternatively, under Part 48.6 of the Civil Procedure Rules, viz. Mr Sandhu is responsible for payment of the Receiver's costs properly incurred by the Receiver as a litigant in person.
Mrs Sandhu
Mrs Sandhu played no part real in the proceedings. It was Mr Sandhu who was the driving force behind resistance to the Receiver's applications and, in my judgment, he alone should be liable for the costs, if anyone.
THE LAW
Receiver's Remuneration under CPR
When considering receiver's remuneration, the normal CPR costs rules, i.e. Parts 43 to 48, do not apply. The relevant rules are contained in Part 69.7 of the Civil Procedure Rules, namely:
"(1) a receiver may only charge for his services if the court-
(a) so directs; and
(b) specifies the basis on which the receiver is to be remunerated.
(2) The court may specify—
(a) who is to be responsible for paying the receiver; and
(b) the fund or property from which the receiver is to recover his remuneration….
…(4) Unless the court orders otherwise, in determining the remuneration of a receiver the court shall award such sum as is reasonable and proportionate in all the circumstances and which takes into account-
(a) the time properly given by him and his staff to the receivership;
(b) the complexity of the receivership;
(c) any responsibility of an exceptional kind or degree which falls on the receiver in consequence of the receivership;
(d) the effectiveness with which the receiver appears to be carrying out, or to have carried out, his duties; and
(e) the value and nature of the subject matter of the receivership."
Practice Direction 69 provides:
"9.2 The court will normally determine the amount of the receiver's remuneration on the basis of the criteria in rule 69.7(4). Parts 43 to 48 (costs) do not apply to the determination of the remuneration of a receiver."
The fact that the existing receivership order provides for the costs of the Receiver be met from the receivership assets, is not a bar to recovery of the costs claimed. It is open to the Court to amend or adjust the order at any stage as it deems just and fit in all the circumstances.
Authorities
Sinclair [2009] and Re Andrews [1999]
The question of whether Receiver's expenses were to be met from the assets of the estate or were recoverable as litigation costs was considered in Re Andrews [1999] 1 WLR 1236 and Sinclair v Glatt (Glatt intervening) [2009] 1 WLR 1845. In both cases, it was held considered that the expenses of a receivership were to be met from the assets of the estate and were...
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