The Canada Trust Company (Acting in its capacity as Trustee of the Chrysler Canada Ltd's Benefits Plan, the Chrysler Canada Ld. Master Trust Fund, the Chrysler Canada Ltd Non-Canadian Master Trust Fund and The Holmes Foundry Division Master Trust Fund) and Others v Century Holdings Ltd and Others
| Jurisdiction | British Virgin Islands |
| Judge | Moore J. |
| Judgment Date | 08 December 1999 |
| Neutral Citation | VG 1999 HC 16 |
| Court | High Court (British Virgin Islands) |
| Docket Number | CIVIL SUIT NO. 27 OF 1997 |
| Date | 08 December 1999 |
IN THE HIGH COURT OF JUSTICE
CIVIL SUIT NO. 27 OF 1997
Mr. Hare and Mr. Kite for the Applicant
Mr. Paul Dennis for the Respondent
This is an application by summons dated the 5 th August, 1999 for leave of appeal from a judgment, which I declined on the 23 rd July 1999, awarding costs to the Eighth Defendant to be taxed, fit for two counsel, if not agreed down to the date of Judgment. The Eighth Defendant, who was the custodian of certain documents belonging to a client, sought the court's determination of the questions whether those documents were covered by legal professional privilege and whether it ought to give discovery of those documents to the Plaintiff.
The plaintiff in its skeleton arguments contended that there was no need for the Eighth Defendant, which is a firm of lawyers, to seek the guidance of the Court or to seek outside legal advise. I do not agree. Rather, I hold that it was reasonable for the Eighth Defendant to seek independent legal advice. It is a notorious fact that a lawyer, despite his specialist training and experience, runs the risk of the impairment of his professional objectivity when dealing with his own causes. I do not accept the proposition that there was no need for the Eighth Defendant to seek the guidance of the Court. The Eighth Defendant owed a duty to its client and to itself. In my view it was in the interest of all parties concerned that the Eighth Defendant should seek the guidance of the court. There was no dereliction of its duty to its client in doing so.
In Norwich Pharmacal Co. v Commissioners of Customs and Excise [1973] 2 All ER 943at p 949 g Lord Reid made it clear that:
‘If the respondents have any doubts in any future case about the propriety of making disclosures they are well entitled to require the matter to be submitted to the Court at the expense of the person seeking the disclosure….The respondents were quite right in requiring the matter to be submitted to the Court’.
In Scherer and another v Counting Instruments Ltd. And another [1986] 2 All ER 529at 532 j Buckley LJ made it clear that:
‘If a judge has made an order for costs, having material before him on which he could exercise his discretion in that way, this court (the Court of Appeal) cannot interfere with his decision unless an appeal is brought with leave of the judge.’
It is the view of the Court that there was ample material before it upon which to base its order for costs in the instant case. But Buckley LJ went further. He cited an excerpt from the speech of Viscount Cave LC in Donald Campbell & Co. Ltd v Pollack [1927] AC 732 1 [1927] All ER Rep. 1 where the Lord Chancellor endorsed what was said by Wilmer LJ. in Jones v McKie and Mersey Docks and Harbour Board [1964] 2 All E.R. 842at 845D:
‘What it comes to, I think, is that in order to justify an appeal as to costs only this court must be able to say that the judge in the court below, however much he may have been purporting to exercise his discretion, has not really exercised his discretion at all. This court can say that, but can say it only, as I see it, if it is satisfied that the judge in the court below has taken into consideration wholly extraneous and irrelevant matters.’
Buckley LJ continued:
‘If, therefore, in the present case the judge had material before him, however slight, on which he could base his exercise of discretion in ordering the plaintiffs to pay the defendants' costs of the motions to dismiss, we cannot interfere. If he has none, this court can entertain this appeal on the basis that the judge has not exercised his discretion or has not exercised it judicially.’
At page 536 b–h he set out the following 10 relevant principles:
‘From the cases which we have cited and from Ottway v Jones [1955] 2 All ER 585, [1955] 1 WLR 706, Baylis Baxter Ltd V Sabath [1958] 2 All ER 209, [1958] 1 WLR 529andWilliam C Parker Ltd v F J Ham & Son Ltd. [1972] 3 All ER 1051, [1972] 1 WLR 1583, which were also referred to by counsel, we derive the following propositions. (1) The normal rule is that costs follow the event. That party who turns out to have unjustifiably either brought another party before the court or given another party cause to have recourse to the court to obtain his rights is required to recompense that other party in costs. But, (2) the judge has under s 50 of the 1925 Act an unlimited discretion to make what order as to costs he considers that the justice of the case requires. (3) Consequently, a successful party has a reasonable expectation of obtaining an order for his costs to be paid by the opposing party but has no right to such an order, for it depends on the exercise of the court's discretion. (4) This discretion is not one to be exercised arbitrarily: it must be exercised judicially, that is to say in accordance with established principles and in relation to the facts of the case. (5) The discretion cannot be well exercised unless there are relevant grounds for its exercise, for its exercise without grounds cannot be a proper exercise of the judge's function. (6) The grounds must be connected with case. They may extend to any matter relating to the litigation, but no further. (7) If no such ground exists for departing from the normal rule, or if, although such grounds exist, the judge is known to have acted not on any such ground but on some extraneous ground, there has effectively been no exercise of the discretion. (8) If a party invokes the jurisdiction of the court to grant him some discretionary relief and establishes the basic grounds therefor but the relief sought is denied in the exercise of discretion, as in Dutton v Sprink & Beeching (Sales) Ltd and Ottway v Jones, the opposing party may properly be ordered to pay his costs. But where the party who invokes the Court's jurisdiction wholly fails to establish one or more of the ingredients necessary to entitle him to the relief claimed, whether discretionary or not, it is difficult to envisage a ground on which the opposing party could properly be ordered to...
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