- Respondents to inquiries under cross-undertakings are not entitled to security for costs (JSC Karat-1 v Tugushev)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- The jurisdiction to award security for costs
- The relevance of prior authorities dealing with the difficulties of enforcing English costs judgments in Russia
- The need to demonstrate a ‘real risk’ of substantial obstacles to enforcement
- Case details
Dispute Resolution analysis: The Commercial Court (Mrs Justice Cockerill) recently re-examined fundamental aspects of the jurisdiction to order security for costs. Its judgment is a salutary reminder of three things. First, security for costs can only be ordered in favour of a defendant, and a claimant does not become a defendant simply because they are faced with an inquiry under a cross-undertaking in damages. Secondly, an applicant seeking security for costs on the basis that there is a real risk of substantial obstacles to enforcement of costs orders in their adversaries’ jurisdiction cannot simply rely on previous cases which have reached that conclusion; they must actually adduce evidence to support that allegation. Thirdly, one must actually show a ‘real risk’ of such obstacles. This requires more than simply demonstrating a ‘mere possibility’ of such obstacles arising. Written by Christopher Pymont QC and James Kinman of Maitland Chambers.
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