The High Court ordered Weidemark Fleischwaren GmbH & Co to pay the costs of an injunction motion brought by Irish Bacon Slicers Limited after the defendant offered an undertaking against presenting a winding-up petition only when the motion was called for hearing.
Mr Justice Michael Peart’s judgment, delivered on 30 May 2014, concerned the costs of the motion, not the underlying debt dispute. The defendant had obtained an interim injunction on 21 June 2013. On 23 July, before the interlocutory injunction application was heard, the defendant told the court it would undertake not to petition to wind up the plaintiff. The plaintiff accepted the undertaking but sought its costs.
The dispute followed a 14 June 2013 letter from the defendant’s solicitors demanding almost €800,000 by 19 June, said to be a debt owed to their client. The letter reserved the right to seek the plaintiff company’s winding up if payment was not made. The plaintiff disputed owing any sum and said there was no contractual relationship between the companies. Its solicitors requested an undertaking that no winding-up petition would be presented. When no undertaking or response arrived by the stated deadline, the plaintiff issued proceedings on 20 June seeking injunctive relief.
The plaintiff argued that costs should be awarded because the undertaking given in court was the one it had requested five weeks earlier, after it had incurred costs preparing for the motion. The defendant maintained that it was taking a pragmatic course and still claimed the money was owed. It argued that costs should be reserved until the debt proceedings were decided.
Justice Peart said the undertaking, offered to and accepted by the court, brought the injunction application to an end and was enforceable as an undertaking to the court. Under Order 99, rule 1(4A) of the Rules of the Superior Courts, the court had to award costs when determining an interlocutory application unless it could not justly decide liability at that stage. The rule did not require costs to follow a separately determined “event”; the court retained discretion.
The judge found it reasonable for the plaintiff to take the threatened petition seriously and to seek an injunction after receiving no response to its request. He said the defendant’s undertaking should have been given earlier and that the motion need not have been brought. The court therefore awarded the plaintiff the costs of the Notice of Motion. The judgment did not determine whether the alleged debt was owed; the defendant said it would pursue that claim in separate proceedings.