Security for Costs

Question 1

[SECURITY FOR COSTS] What must a defendant establish to obtain an order for security for costs in the High Court?

Answer 1

A prima facie defence on the merits and the absence of special circumstances that would justify refusing the order.

Question 2

[SECURITY FOR COSTS] What is the full procedural pathway for seeking security for costs in the High Court?

Answer 2

Defendant first seeks undertaking from plaintiff; if no satisfactory response within 48 hours, applies to the High Court by motion on notice with grounding affidavit.

Question 3

[SECURITY FOR COSTS] Who determines whether security should be ordered and who determines the amount?

Answer 3

The High Court determines entitlement; the Master determines the amount and form of security.

Question 4

[SECURITY FOR COSTS] What is the procedure for fixing the amount of security for costs?

Answer 4

Application to the Master by motion grounded on affidavit with cost estimates, with plaintiff entitled to file a replying affidavit.

Question 5

[SECURITY FOR COSTS] What principle governs applications where the plaintiff is resident outside the jurisdiction?

Answer 5

Residence alone is insufficient; defendant must still show a prima facie defence.

Question 6

[SECURITY FOR COSTS] What rule was established in Heany v Malocca regarding plaintiffs outside the jurisdiction?

Answer 6

Defendant is prima facie entitled to security unless special circumstances exist.

Question 7

[SECURITY FOR COSTS] What are examples of “special circumstances” preventing an order for security?

Answer 7

No bona fide defence, sufficient assets within jurisdiction, or constitutional access to courts concerns.

Question 8

[SECURITY FOR COSTS] How does the presence of multiple plaintiffs affect security for costs?

Answer 8

If one bona fide plaintiff is within the jurisdiction, security will generally not be ordered.

Question 9

[SECURITY FOR COSTS] What constitutional principle is relevant to security for costs applications?

Answer 9

The right of access to the courts.

Question 10

[SECURITY FOR COSTS – EU] What is the EU law position on security for costs for plaintiffs resident in EU Member States?

Answer 10

Security cannot be ordered solely on grounds of residence due to prohibition on nationality discrimination.

Question 11

[SECURITY FOR COSTS – EU] What must be shown to obtain security for costs against an EU-based plaintiff?

Answer 11

Cogent evidence of substantial difficulty in enforcing a judgment (Maher).

Question 12

[SECURITY FOR COSTS – INDIVIDUAL] What is the general approach to fixing the amount of security for costs for individuals?

Answer 12

It is usually a proportion (often about one-third) of likely costs, not a full indemnity.

Question 13

[SECURITY FOR COSTS – INDIVIDUAL] What is the purpose of limiting the amount of security ordered?

Answer 13

To avoid discouraging legitimate litigation or encouraging excessive costs.

Question 14

[SECURITY FOR COSTS – COMPANY] What is the full test for ordering security for costs against a company under s52 Companies Act 2014?

Answer 14

Defendant must show a prima facie defence and that the plaintiff company is unable to pay costs if unsuccessful.

Question 15

[SECURITY FOR COSTS – COMPANY] How is a prima facie defence assessed in corporate security applications?

Answer 15

By showing admissible evidence and arguable legal submissions (Tribune).

Question 16

[SECURITY FOR COSTS – COMPANY] What happens once inability to pay and a defence are established?

Answer 16

The court considers whether special circumstances exist to refuse the order.

Question 17

[SECURITY FOR COSTS – COMPANY] What are key “special circumstances” in corporate cases?

Answer 17

That the defendant caused the plaintiff’s impecuniosity, delay in seeking security, or issues of exceptional public importance.

Question 18

[SECURITY FOR COSTS – COMPANY] Who bears the burden of proving that the defendant caused the plaintiff’s impecuniosity?

Answer 18

The plaintiff (Framus).

Question 19

[SECURITY FOR COSTS – COMPANY] How is the amount of security assessed for companies?

Answer 19

By making a reasonable estimate of likely actual costs (Lismore Homes).

Question 20

[SECURITY FOR COSTS – COMPANY] Does EU discrimination law apply to corporate plaintiffs in security for costs?

Answer 20

No, as companies do not raise the same nationality discrimination concerns.

Question 21

[SECURITY FOR COSTS – APPEAL] What is the test for ordering security for costs on appeal to the Supreme Court?

Answer 21

Whether the interests of justice require the order.

Question 22

[SECURITY FOR COSTS – APPEAL] What principle was established in Midland Bank regarding poverty?

Answer 22

Poverty alone is not enough, but it is a necessary starting point.

Question 23

[SECURITY FOR COSTS – APPEAL] When will courts be less likely to order security on appeal?

Answer 23

Where the case raises a point of law of public importance.

Question 24

[SECURITY FOR COSTS] What is the consequence of failing to provide ordered security for costs?

Answer 24

The court may dismiss the proceedings.

Question 25

[SECURITY FOR COSTS] In what circumstances will a court dismiss proceedings for failure to provide security?

Answer 25

Where there is lack of diligence or no reasonable prospect of payment.

Question 26

[SECURITY FOR COSTS – CIRCUIT COURT] What is the procedure for seeking security for costs in the Circuit Court?

Answer 26

Defendant requests undertaking; if not given within 7 days, applies by motion on notice grounded on affidavit.

Question 27

[SECURITY FOR COSTS – CIRCUIT COURT] How does the Circuit Court approach compare to the High Court?

Answer 27

The principles are largely the same, with minor procedural differences.

Question 28

[SECURITY FOR COSTS – DISTRICT COURT] What governs security for costs in the District Court?

Answer 28

Order 45A DCR.