Kerry Underwood

SECURITY FOR DAMAGES AS CONDITION OF RELIEF FROM SANCTIONS

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In

Gama Aviation (UK) Ltd v Taleveras Petroleum Trading DMCC [2019] EWCA Civ 119 (07 February 2019)

the Court of Appeal overturned a decision of the Business and Property Courts that the defendant should pay £1 million security as a condition of being allowed to rely on a witness statement served just a few days before the hearing, failing which judgment would be entered against it for the full sum claimed with interest and costs.

If the defendant was unable to pay, then it would have been in a worse position than if the summary judgment application had been heard without the statement it wished to rely on, as at least the court would have had to consider the merits of the claim.

Here, the judge lost sight of the caution which the court must exercise before making such an order.

Furthermore the sanction of judgment being entered in the absence of the security was disproportionate.

The penalty for failing to provide the security, had that order been appropriate, which it was not, was the inability to rely on the witness statement.

The judgment contain a helpful explanation of the relevant case law.

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Written by kerryunderwood

February 14, 2019 at 10:04 am

Posted in Uncategorized

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