The High Court has set security for costs at €501,592 in a dispute over a proposed housing development in Ashford, County Wicklow. The amount covers the two defendants’ estimated legal costs for a six-day hearing and preparatory work. The judgment says the court could not determine whether that estimate was “reasonable” under the Legal Services Regulation Act 2015 because the underlying time and hourly rates were not provided.
Beakonford Limited is suing Oonagh Stokes and Barbara Wilding, alleging that they sought to extort money from the company by challenging planning permission for its proposed development at Inchanappa South. The allegations have not been determined in this security-for-costs application.
The defendants sought security for their costs. Beakonford accepted that they had a prima facie defence, and the court said there was insufficient evidence that the defendants’ actions had caused the company’s alleged inability to pay costs if it lost. The question was whether there was reason to believe Beakonford would be unable to pay the defendants’ costs if they succeeded.
The court found that threshold met. Beakonford had not filed company accounts and relied on a draft balance sheet that valued the development site at €32 million. An accountancy report for Ms Stokes challenged that valuation and concluded the company was in a negative net asset position when the site was recorded at its purchase cost plus acquisition expenses. The court noted that this expert evidence had not been answered by Beakonford. It also questioned the basis of a property valuation that relied on projected housing sales across four phases, although the site had planning permission for only one phase. The court referred as well to two offers of €9.5 million and €10 million for the site, and evidence of borrowing exceeding €10 million.
On the amount of security, three experts estimated one defendant’s costs at €250,796, €411,249 and €454,820.50, including VAT. The court preferred the lower estimate from Lowes Legal Costs Accountants, setting €250,796 for each defendant, or €501,592 in total. It rejected estimates that included two senior counsel for Ms Stokes or two solicitors for Ms Wilding, and said the similar claims against the defendants could allow efficiencies.
The judge stressed that the figure was an estimate for security, not a final adjudication of costs. Because none of the reports gave the hours or hourly rates behind their figures, the court could not decide whether the preferred estimate was reasonable under the 2015 Act. It said that if Beakonford loses the substantive case, the Legal Costs Adjudicator can assess the defendants’ costs using hourly rates that are objectively reasonable.
The judgment also said that time and hourly rates should be considered when estimating or adjudicating legal costs. The case was provisionally listed for mention a week after delivery to deal with final orders and costs; the parties could notify the Registrar if that sitting proved unnecessary.