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England and Wales High Court (Chancery Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> M L Technology Limited & Anor v B.E.A.T SAM & Ors [2023] EWHC 1660 (Ch) (08 June 2023) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2023/1660.html Cite as: [2023] EWHC 1660 (Ch) |
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BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (ChD)
Fetter Lane London |
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B e f o r e :
____________________
IN THE MATTER OF | ||
(1) M L TECHNOLOGY LIMITED | ||
(2) NAUREX LIMITED | Claimants | |
-v- | ||
B.E.A.T SAM & OTHERS | Defendants |
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MS DENISE MCFARLAND appeared on behalf of the Defendants
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Crown Copyright ©
JUDGE PAUL MATTHEWS:
"The English courts have wide case management powers and they do include the power to impose a temporary stay on proceedings where to do so would serve the overriding objective. (See CPR 1.2(a) and 3.1(2)(f)). A temporary stay may be ordered where are parallel proceedings in another jurisdiction raising similar or related issues between the same or related parties, where the earlier resolution of those issues in the foreign proceedings would better serve the interests of justice than by allowing the English proceedings to continue without a temporary stay. But this would be justified only in rare or compelling circumstances."
"There is it seems to me no reason to doubt that it is only in rare and compelling cases that it will be in the interests of justice to grant a stay on case management grounds in order to await the outcome of proceedings abroad. After all the usual function of a court is to decide cases and not to decline to do so. Access to justice is a fundamental principle under both the common law and Article 6 ECHR. The court will therefore need a powerful reason to depart from its usual course and such cases will by their nature be exceptional. In my judgment all of the guidance in the cases which I have cited is valuable and instructive, but the single test remains whether in the particular circumstances it is in the interests of justice for a case management stay to be granted."
"(1) The court has a wide discretion to stay proceedings, but in circumstances where the claimant itself has voluntarily brought the two sets of proceedings, a stay should only be granted in very rare circumstances. (2) Even where there are such reasons for a stay, a stay should only be granted if the benefits of doing so clearly outweigh any disadvantage to the other party. (4) A stay will not, at least in general, be appropriate if the other proceedings will not even bind the parties to the action stayed, let alone finally resolve all the issues in the case to be stayed. (5) A stay will not, at least in general, be appropriate if the parties to the other proceedings are not the same."
"Fifthly, the result of imposing a stay is that in order to continue their court applications challenging the consent award, the claimants must first defend themselves against large financial claims in the second arbitration. If those claims were to succeed, the defendants would no doubt seek to enforce the awards in their favour in any jurisdiction where the claimants may have assets and would seek to do so before the determination of either (a) the claimant's existing court applications or (b) any applications which they might make to challenge the awards in the second arbitrations. That possible outcome would be inappropriately burdensome for the claimants. It is a factor that should be taken into account in exercising the court's discretion."
"I consider that the approach in Denton v White is of some relevance when considering the particular circumstances of this case. This was a situation where, just as if they were facing an unless order with which they had not complied, the claimants needed the court to get them out of a major difficulty; where they were throwing themselves on the mercy of the court in order to prevent the vast majority of their claims from coming to a shuddering halt. No extension of time meant no continuing claim for the vast majority of these claimants, just as if the order of 2 June 2021 had indeed been an unless order. Accordingly, it seems to me that the general principles identified in Denton v White are applicable, at least by analogy, when considering the application of the over-riding objective to this case."
"The court must carry out a balancing exercise. On the one hand it must weigh the injustice to the plaintiff if prevented from pursuing a proper claim by an order for security. Against that it must weigh the injustice to the defendant if no security is ordered and at the trial of the plaintiff's fails and the defendant finds himself unable to recover from the plaintiff the costs which have been incurred by him in his defence of the claim. The court will properly be concerned not to allow the power to order security to be used as an instrument of oppression such as by stifling a genuine claim by an indigent company against a more prosperous company, particularly when the failure to meet that claim might in itself have been a material cause of the plaintiff's impecuniosity. But it will also be concerned not to be so reluctant to order security that it becomes a weapon whereby the impecunious company can use its inability to pay costs as a means of putting unfair pressure on the more prosperous company."
"Lord Denning did not suggest that the matter must be viewed on the basis that either the conduct must be unconnected with the subject matter of the dispute or that it must be looked at on the basis that the claim would be unsuccessful. It seems to me that the true factor to consider is whether the conduct alleged has, if it is proved, in fact brought about or contributed to the insolvency of the claimant company."