Summit Navigation Ltd & Anor v Generali Romania Asigurare Reasigurare SA Ardaf SA & Anor
2014
COMMERCIAL COURT
United Kingdom
CORAM
- MR JUSTICE LEGGATT
Areas of Law
- Civil Procedure
- Commercial Law
2014
COMMERCIAL COURT
United Kingdom
CORAM
AI Generated Summary
The court resolved the dispute involving a one-day delay by the claimants in providing security for costs in a marine insurance claim. The defendants capitalized on this delay to seek an automatic stay of the proceedings, which consumed significant court time and resources. The court ruled in favor of the claimants, lifted the stay, and emphasized principles from Mitchell, particularly regarding the need for efficient litigation and not trivializing minor defaults.
Judgment
Mr Justice Leggatt :
Introduction
The decision of the Court of Appeal in Mitchell v News Group Newspapers Ltd [2013] EWCA Civ 1537 , [2013] 6 Costs LR 1008 , on the effect of the new CPR 3.9 , has rightly been described as a “game changer”: see Michael Wilson & Partners Ltd v Sinclair [2013] EWCA Civ 1732 , per Lewison LJ. It is important for litigants to understand, however, how the rules of the game have been changed and how they have not. The defendants in this case have sought to rely on Mitchell to turn to their tactical advantage a short delay by the claimants in providing security for costs which in itself had no material impact on the efficient conduct of the litigation. They have argued that the consequence of the claimants’ default should be that the action remains permanently stayed.
Unlike the claimants’ default itself, the defendants’ response to it has had a very serious impact on the litigation. The whole timetable for the proceedings has been derailed, significant costs have been incurred and court time has been wasted to the detriment of other court users. In other words, the reliance placed on Mitchell in this case has had the very consequences which the new approach enunciated by the Court of Appeal in Mitchell is intended to avoid.
In the hope of discouraging other litigants from making similar arguments to those made by the defendants in this case, with similar disruptive consequences, I said at the end of the hearing that I would put in writing my reasons for the orders which I then made. This judgment gives those reasons.
Procedural history
The first claimant is a Maltese company which owned the vessel “Beril”, and the second claimant is Turkish company which managed the vessel. They claim in this action under a policy of marine insurance issued by the defendants in respect of damage to the vessel’s hull and machinery. The amount at stake is modest by the standards of commercial claims being some US$500,000.
The action was begun in March 2012. In March 2013 the claimants were ordered to and did provide security for the defendants’ costs in a sum of £25,000 by procuring a bond from a company called Amtrust Europe Ltd which insured the claimants for their potential costs liability up to that amount.
After statements of case had been served, directions for the future conduct of the action were agreed and embodied in an order made by consent on 11 October 2013. That order set out a timetable for disclosure, servic