May 25, 2023 COURT OF FIRST INSTANCE - ORDERS
Claim No: CFI 070/2022
IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
PARAMJIT KAHLON
Claimant
and
LIBERTY STEEL GROUP LTD
Defendant
ORDER WITH REASONS OF H.E. DEPUTY CHIEF JUSTICE ALI AL MADHANI
UPON the Part 7 Claim and the Particulars of Claim dated 17 October 2022
AND UPON the Defendant’s Application No. CFI-070-2022/1 dated 11 November 2022 contesting the jurisdiction of the DIFC Courts (the “Application”)
AND UPON hearing counsel for the Claimant and counsel for the Defendant at the hearing listed before me on 17 March 2023 (the “Jurisdiction Hearing”)
AND UPON my Order with Reasons dated 24 April 2023 dismissing the Application and ordering the Parties to file costs submissions by no later than 1 May 2023
AND UPON reviewing the Parties’ costs submissions dated 1 May 2023
AND UPON reviewing the relevant documents in the case file
AND UPON reviewing Part 38 of the Rules of the DIFC Courts (“RDC”)
IT IS HEREBY ORDERED THAT the Claimant shall be awarded their costs of the Application on a standard basis, otherwise assessed by the Registrar, if not agreed.
Issued by:
Hayley Norton
Assistant Registrar
Date of Issue: 25 May 2023
At: 11am
SCHEDULE OF REASONS
1. As set out under RDC 38.7(1) the unsuccessful party[ies] will be ordered to pay the costs of the successful party. The Defendant was unsuccessful in the Application. Accordingly, it would be just that the Defendant is ordered to pay the costs of the Claimant on a standard basis for the reasons set out below.
2. The Defendant recommended in their written submission that the DIFC Court shall reserve its decision on costs primarily because the preparation for the Jurisdiction Hearing was largely duplicative and will ultimately be repeated in trial. In addition, the evidence relied on by the Claimant is yet to be challenged under cross examination at trial.
3. The Claimant argued in their submission that their costs should in fact be awarded on an indemnity basis for various reasons, few of which being the Defendant adopted an unreasonable approach in making its Application which was inconsistent with the DIFC laws, the Defendant’s conduct in bringing a hopeless application was unreasonable and an abuse of process, therefore the Defendant ought to be penalised for putting the Claimant to unnecessary expense which has had the effect of delaying matters.
4. I remind myself of the Practice Direction PD 5/2014 which mandates certain factors, inter alia, to be taken into account in determining whether costs should be assessed on an indemnity basis as opposed to a standard basis being: (i) the circumstances where the facts of the case or the conduct of the paying party is such as to take the situation away from the norm, for example where the Court has found deliberate misconduct in breach of the Court or unreasonable conduct to a high degree in connection with the litigation or (ii) otherwise inappropriate conduct in its wider sense in relation to a paying party’s pre-litigation dealings with the receiving party or in relation to the commencement or conduct of the litigation itself or (iii) where the Court considers the paying party’s conduct to be an abuse of process.
5. The conduct of the Defendant does not warrant a cause of concern, the type of “deliberate misconduct” has not been established at this stage. Whilst it might be difficult for the Claimant not to avoid the conclusion that the Defendant’s actions were aimed at delaying proceedings, it could be argued that they were primarily putting forward an application which they were entitled to do so under a legislation and before a court of law.
6. Therefore, the Court takes a strict view in awarding costs on an indemnity basis and there is an exceptionally high standard threshold for the Claimant to demonstrate to be awarded its costs on an indemnity basis. I am of the view that this threshold has not been met in this matter.
7. The Defendant argued that the Court should reserve a cost order to a “later occasion”, therefore having the effect that the decision about costs is deferred, and if no later order is made, the costs will be costs in the case. The basic principle that costs follows the event. In the circumstances, the unsuccessful party, being the Defendant shall be ordered to pay the Claimant’s costs incurred with respect to the Jurisdiction Application, particularly when the Claimant has succeeded on that Application.
8. It is on that basis that the Claimant shall be awarded their costs of the Jurisdiction Application on a standard basis, otherwise assessed by the Registrar, if not agreed.