Weissfisch v Julius
| Jurisdiction | England & Wales |
| Judge | Mr. Justice Peter Smith |
| Judgment Date | 11 November 2005 |
| Neutral Citation | [2005] EWHC 2746 (Ch) |
| Date | 11 November 2005 |
| Docket Number | Case No: HC 05 C02675 |
| Court | Chancery Division |
[2005] EWHC 2746 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Mr. Justice Peter Smith
Case No: HC 05 C02675
MR. ALAN STEINFELD QC and MISS CLARESTANLEY (instructed by Weil Gotshal & Manges) for the Claimant
MR. GRAHAM DUNNING QC (instructed by Allen & Overy) for the First Defendant
Approved Judgment
I have before me an application for security for costs issued by the first defendant in this action, now one of 40 defendants, Mr. Julius. There is a procedural history to this case which arises from a dispute between the claimant as to the nature and effect of the retainer by him of Mr. Julius, a solicitor, and whether or not that retainer is solely his or whether that retainer is a joint retainer and, if so, jointly with whom.
The basis for the dispute is that the claimant desires access to files. As a result of interlocutory applications made before me the claimant has had access to some files. There has been joint inspection of the files or documents as revealed by Mr. Julius to be in his possession; some of those files have also been conceded by the claimant as not to form part of the retainer issue. They are files which relate to his brother's affairs. The bulk of the files, however, remain disputed files. I directed on 14th October a speedy trial and, as I understand the position, the trial is floating from 5th December with an estimate of three days.
The claimant is resident within the Bahamas. The application is made on two bases, first under CPR 25.13(1)(a) and subrule(2) that the claimant is resident out of the jurisdiction and also (g) the claimant has taken steps in relation to his assets that will make it difficult to enforce an order for costs against him. In respect of item (g) the material justifying that application is set out in paragraphs 39 and 40 of the witness statement of Richard Smith, Mr. Julius's solicitor. I do not accept that the information set out in those paragraphs shows any basis for suggesting objectively that Amir, the claimant, is acting as set out in paragraph (g).
I will not, because of the shortness of time, adumbrate that further but it seems to me self-evident that the application is based on a misconception in respect of the actions and a misunderstanding of the nature of the discretionary trust and the steps taken by Amir to preserve assets rather than make them more difficult to be enforced against. He started life as a discretionary object and as a result of the exercise he has become a potential object —that is a gathering in, not a removing, in my view.
In respect of the other ground, as I have said, it is not disputed that he is resident in the Bahamas. It is also accepted that he has lived in the Bahamas since 1999 and he has a substantial presence there in that he occupies a valuable property in the Bahamas worth far in excess of the amount sought, namely £500,000. It is said that that property is difficult to enforce against because there may be a dispute as to the ownership of the property. I will come back to that at a later stage when I consider the facts.
Based on those matters it is submitted by Mr. Julius that security should be ordered under paragraph 25.13(2)(a). It is well established now that the exercise of the discretion cannot be made merely because a person is not resident in a Brussels or Lugano state. That appears from the decision of the Court of Appeal in Nasser v. United Bank of Kuwait [2002] 1 WLR, 1868 at paragraphs 58 and 59 which state as follows:
"58 The exercise of the discretion conferred by rule 25.13(1) and (2)(a)(i) and (b)(i) raises, in my judgment, different considerations. That discretion must itself be exercised by the courts in a manner which is not discriminatory. In this context at least, I consider that all personal claimants (or appellants) before the English courts must be regarded as the relevant class. It would be both discriminatory and unjustifiable if the mere fact of residence outside any Brussels/Lugano member state could justify the exercise of discretion to make orders for security for costs with the purpose or effect of protecting defendants or respondents to appeals against risks to which they would equally be subject, and in relation to which they would have no protection, if the claim or appeal were being brought by a resident of a Brussels or Lugano state. Potential difficulties or burdens of enforcement in states not parry to the Brussels or Lugano Convention are the rationale for the existence of any discretion. The discretion should be exercised in a manner reflecting its rationale, not so as to put residents outside the Brussels/Lugano sphere at a disadvantage compared with residents within. The distinction in the rules based on considerations of...
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Elliott v CI Health Servs Auth
...Ltd., [1990] 1 W.L.R. 562; [1990] 1 All E.R. 972; [1990] B.C.C. 293; [1991] I.L. Pr. 66, referred to. (8) Weissfisch v. Julius, [2005] EWHC 2746 (Ch.), referred to. Legislation construed: Grand Court Rules, O.23, r.1(1): The relevant terms of this paragraph are set out at para. 3. Health Se......