The Court of Appeal has set aside a High Court order requiring the respondents to pay the petitioner’s costs in a company share dispute. It ordered that neither side should recover costs of the High Court petition through 5 June 2015, including the valuation and remedy modules and reserved costs.
The court also ordered no costs for either the valuation appeal or the remedy appeal. On costs of the costs appeal itself, it expressed a preliminary view that there should be no order. It said the parties could agree, but that it would hear submissions if they could not.
The dispute arose from Donegal Investment Group plc’s petition under section 205 of the Companies Act 1963. The High Court had fixed the price at which the respondents might buy the petitioner’s shares at €30.6 million. It later ordered the respondents to purchase the shares. The High Court awarded the petitioner its costs of the petition, including both modules and reserved costs.
The respondents appealed the costs order. They argued that they had effectively succeeded on valuation because the High Court’s figure was closer to their proposed range of €22.3 million to €22.6 million than to the petitioner’s approximately €63.5 million figure. The petitioner argued that the award exceeded the amount the respondents had offered before proceedings began.
The Court of Appeal said neither side’s position on valuation could establish who had succeeded. It had already allowed the petitioner’s valuation appeal and sent the multiplier issue back to the High Court for a fresh determination using a 2016 valuation date. The valuation outcome therefore remained undecided.
On the remedy module, the respondents had consistently been willing to buy the petitioner’s shares. The petitioner had also sought alternatives: realisation of the company under a shareholders’ agreement, or a right for it to buy the respondents’ shares. The High Court rejected those alternatives. The Court of Appeal said the respondents would ordinarily have been entitled to their costs of that module, while recognising that the petitioner had needed to bring proceedings over the failure to agree a price.
Taking account of the unusual course of the case, the court allowed the respondents’ appeal against the High Court costs order and vacated it. The decision did not determine the share valuation, which had been remitted for further hearing.