Chernukhin (1) Navigator Equities Limited (2) Cargin (3) v Danilina [2018] EWCA Civ 1802



Judge: Longmore LJ, Hamblen LJ and Sir Stephen Richards

Citation: [2018] EWCA Civ 1802

Summary:

Once it has been established that there are substantial obstacles sufficient to create a real risk of non-enforcement of a Claimant resident in a non-convention state, the starting point is that the Defendant should have security for the entirety of the costs.  The quantum is a matter of discretion.

Longer text:

Once it has been established that the Claimant is resident out of the jurisdiction and in a non-convention state, the Court has a discretion to make an Order for Security for Costs under Rule 25.13(1) if it is satisfied, having regard to all the circumstances, that it is just to do so.  The discretion has to be exercised in a non-discriminatory manner which requires objectively justified grounds relating to obstacles to or the burden of enforcement in the context of the particular foreign Claimant or country concerned.  The Order for Security should generally be tailored to cater for the relevant risk.  Once it has been established that there are substantial obstacles sufficient to create a real risk of non-enforcement, the starting point is that the Defendant should have security for the entirety of the costs.  There is no room for discounting the security figure by grading the risk using a sliding scale approach.  The quantum of security is a matter of discretion and discretionary factors, such as delay or stifling, might affect the amount of security to be ordered.

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