The Supreme Court has awarded costs to the plaintiffs after dismissing an appeal over an injunction that restrained the defendants from starting director-disqualification proceedings while a separate action continues. It stayed execution of the costs order for one year, but the stay does not prevent the costs from being assessed.
The ruling, delivered on 9 March 2021, dealt with costs arising from the appeal and the High Court hearing. In November 2019, the Supreme Court dismissed the appeal and upheld the High Court’s interlocutory injunction. That injunction was pending trial of the action seeking to permanently restrain the proposed proceedings under section 160 of the Companies Act 1990. The injunction decision did not finally determine whether the notices were invalid or whether the proposed proceedings were an abuse of process.
The Court said the plaintiffs had established a prima facie case on both issues at the interlocutory stage. It also held that the balance of convenience favoured the injunction. The Court stressed that whether the conduct amounted to an abuse of process remained for final decision.
The Court rejected the appellants’ request to reserve costs until the trial. It said the appeal had been dismissed and the High Court order upheld, so the usual rule that costs follow the event applied. Although the appellants had persuaded the Supreme Court to apply a prima facie case test rather than the lower “arguable case” test used by the High Court, the Court said that did not change the outcome or justify changing the costs order.
The Court considered that the remaining issues were limited and largely matters of law, and that the appeal decision would not be revisited at trial. It also criticised the volume of material filed for the costs application and the length of the hearing as excessive for the issues involved. The Court declined to interfere with the High Court’s costs order and awarded the plaintiffs their appeal costs.
The Court refused the request to stay the costs order until the plenary trial, noting the risk of further delay and the absence of evidence supporting a stay. It nevertheless allowed one year before execution, saying this could give Mr Skoczylas time for consideration and focus. The ruling did not stay the costs order itself or defer the assessment of costs.