Claim No. CFI 029/2019
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
BASSAM KHALIFA
and
S.W.I.F.T. (DUBAI) LIMITED
ORDER OF H.E. JUSTICE OMAR AL MUHAIRI
BEFORE H.E JUSTICE OMAR AL MUHAIRI sitting in the Court of First Instance on 8 June 2020
UPON considering the written submissions on costs made by the parties on various dates
AND UPON having regard to all additional documents submitted by the parties and the documents contained on the case management system.
AND UPON hearing submissions from Mr Roger Bowden on behalf of the Claimant and Mr Edward Kemp acting on behalf of the Defendant
IT IS HEREBY ORDERED THAT:
1. The Defendant pay 50% of the Claimants costs relating to the trial of the preliminary issues. Such costs are to be assessed by the Registrar, if not agreed.
2. Both parties are to bear their own costs in relation to the Defendant’s application for an unless order dated 3 March 2020 (the “Withdrawn Application”)
Issued by:
Nour Hineidi
Deputy Registrar
Date of issue: 27 August 2020
At: 1pm
JUDGMENT
1. This is a judgment on the costs arising from a determination of the preliminary issues on 17 March 2020. In considering this judgment I have had regard to all submissions and documents presented by the parties. I have also briefly reviewed the documents submitted for determination of the preliminary issues and my notes of the oral submissions made at the hearing on 17 March 2020.
2. I have also been asked to determine the costs of the Withdrawn Application made by the Defendant. The Defendant submits that the Withdrawn Application was made by reason of a culmination of non-compliance by the Claimant with the Court’s order of 14 November 2020 as amended on 21 January 2020 (the “Case Management Order”). The Defendant sought an order unless order to compel the Claimant to file an opening statement. The Claimant’s legal representatives later confirmed, after submission of the skeleton arguments that the skeleton argument should also be considered as the Claimant’s opening statement.
3. During the hearing on 17 March 2020, Mr Kemp submitted that this application was withdrawn but that the costs of the application remained to be determined. Therefore, I was not required to determine the Withdrawn Application itself because it was withdrawn but I accept that the issue of costs of this application remains a live issue and I have given a determination on these costs in this judgment. However, it should be noted that the conduct complained and giving rise to the Withdrawn Application overlaps with the conduct relating to the determination of the preliminary issues. I have, therefore, taken a broad view of the circumstances when considering both costs orders.
Determination of the Preliminary Issues
4. Submissions regarding the determination of the preliminary issues were orally presented to me on 17 March 2020. I handed down my judgment on 8 April 2020. As part of my order, the parties were required to make submissions as to costs.
5. When making a determination on costs, I must have regard to the factors set out in RDC 38.8; being the conduct of all parties and whether a party has succeeded on all or part of its case. In my judgment, the conduct of all parties is particularly relevant in this matter and formed a substantive part of the Defendant’s submissions. I am further of the view that the manner in which a party’s legal representative conducts litigation of their case is a matter that I must take into account when considering the conduct of the parties under RDC 38.8.
6. Mr Bowden contended in his submissions that his correspondence, relating to this case, with the Deputy Registrar is not a matter for me to consider when determining costs. However, I am entitled to take such conduct into consideration, particularly as such conduct related directly to the progress and case management of determination of the preliminary issues. I have taken such correspondence into account when coming to my decision.
7. Although the Claimant has been successful in relation to the determination of the preliminary issues, it would be inappropriate to award the 50% of the Claimant’s entire costs. No money judgment has been granted and it is, therefore, not correct to say that he has been successful on the claim itself. The Claimant has been successful only in the determination of the preliminary issues. If he were not the claim would not have proceeded any further and the Defendant was effectively seeking immediate judgment on the counterclaim. This is why in Hadef & Co letter dated 30 March 2020 they stated that they; consider an order for costs would be made in respect of the entire matter.
8. The determination of these issues was and is of assistance to the Court and the parties involved. It has narrowed the matters to be determined at the final hearing. The arguments put before the Court were substantive and the issues to be determined were not particularly straight forward. Indeed, on a number of occasions the Court was required to unpick the Claimant’s case to determine the issues at hand. With regard to RDC 38.8; the Claimant has been successful in determination of the preliminary issues but not, as of yet, on any part of his claim which is still to be determined at final hearing.
9. As to the correspondence between Mr Bowden and the Registry; correspondence sent to this Court is registered on the case management system. While Mr Bowden’s email dated 4 March 2020 11:18am was not quoted within the Defendant’s submissions, I have had sight of the same, as the email in question was sent to the Court and is registered on the case management file. I consider that the manner in which Mr Bowden addressed the Deputy Registrar was not appropriate. It was not simply a difference of opinion, as stated by Mr Bowden. The Deputy Registrar plays a key role in the management and determination of cases. Mr Bowden’s email was lengthy, obstructive and condescending. He did not deal with the Court co-operatively or with civility, as expected under the DIFC Code of Conduct. Whether or not the Deputy Registrar pursued her code of conduct complaint is irrelevant, I am to consider the conduct of the parties and the representatives that act on their behalf and I do find that this conduct fell below that of which should be expected from an advocate.
10. Furthermore, I am also of the view that the email sent to Ms Khokhar dated 1 March 2020 from Mr Bowden was inappropriate, The tone of the email was condescending and lacked professional courtesy. Again, the manner of Mr Bowden’s email was not cooperative or civil; it was intended to personally provoke Ms Khokhar.
11. I take no issue with the fact that Ms Khokhar emailed the Claimant directly in circumstances where the Claimant was on the Court record as acting in person, and neither should the Claimant’s representatives. She was merely attempted to ensure progression of the proceedings and the Court’s Case Management Order.
12. The threat of legal proceedings against Ms Khokar personally, as set out in the Claimant’s representative’s letter dated 2 April 2020, is similarly inappropriate and misplaced. The letter does not contain any proper grounds for adding Ms Khokar to these proceedings and is set out in quite threatening terms. I find this conduct unreasonable.
13. Under the terms of the Case Management Order, originally dated 14 November 2019, an agreed bundle was to be filed by 3 February 2020. The order was silent as to who was responsible for filing the bundle. For trials, it is usually the custom for the Claimant to file the bundle and this is confirmed in RDC 35.21. The hearing was a trial of the preliminary issues, which the Claimant agreed was necessary to narrow the issues between the parties. The filing of the bundle should not have been contentious, and the parties are expected to co-operate with one another. It was, therefore, unreasonable for the Claimant’s representatives to have insisted that the Defendant file the bundle.
14. Similarly, in relation to the filing of skeleton arguments; I take the view that the words “in any event before…” as included within the Case Management Order set out a clear timescale for the filing of the skeleton argument. Skeleton arguments not only assist this Court in preparing to hear the claim, but they also assist the parties in preparing for the hearing and have potential to open up settlement discussions between the parties. Whilst I appreciate that the Claimant’s representatives had only recently come on the Court record, they should not have done so if they could not deal with the matter promptly, with competence and without undue interference from the pressure of other work. Accordingly, the Claimant’s skeleton argument was filed late and the time period for filing, as was evident from the order, should not have been contentious. If there was any confusion, clarification and/or an extension of time should have been sought between the parties or from the Court.
15. It was only until three days after the Defendant had filed the Withdrawn Application for an unless order that the Claimant confirmed that his skeleton argument should also be interpreted as his opening statement. This was not clear from the contents of the skeleton argument and, in my view, added more fuel to the fire, in respect of the Claimant’s ongoing non-compliance with the Case Management Order.
16. I am not willing to presume that the Claimant’s continual change of legal representatives shows a pattern of falling out. However, I do note that this is unusual and, as when any legal representative takes over a case from another, there will always be an element of overlap in the new representative having to read-in and get to grips with the case. This will be taken into account when assessing the costs.
17. I reject the submission that there was some ulterior motive to the Defendant’s application for determination of preliminary issues. The need for determination of these issues was ordered by the Court and agreed by the Claimant. There is no basis, other than supposition, that in seeking a determination on the preliminary issues the Defendant was attempting to bankrupt the Claimant.
18. As to Mr Bowden’s submission regarding the evidence required to be put before the Court on 17 March 2020 for determination of the preliminary issues; none of these were raised at the hearing. If he considered there was a real detriment from the way that the evidence was to be presented before the Court, he should have raised the same. Leave to cross-examine was not sought by either of the parties and was not mentioned within the Case Management Order. It is not usual for there to be cross-examination of witnesses during determination of preliminary issues, especially when such issues are predominantly legal.
19. A number of Mr Bowden’s submissions on the potential abuse of process and the issuance of the counterclaim are matters for consideration at the final hearing and not relevant to the consideration of costs upon determination of the preliminary issues. Further, I do not consider that Mr Bowden’s submissions regarding the costs relating to document production and the comparative submissions on Rihan v Ernst Young Global Ltd [2020] EWHC 901 [QB] are of any assistance in determining the costs arising from the trial of the preliminary issues.
20. Although I appreciate that the Claimant was acting as a litigant in person at the time of the case management hearing on 14 November 2019, the preliminary issues were presented by both the parties to be determined by the Court. I further note that the Defendant took the lead on putting forward these issues. However, I cannot ignore that there seemed to be a late concession with regard to issue 5(b), if this was no longer being relied upon the Claimant could have clarified this well in advance. This, inevitably, wasted some time and cost in preparing for the trial of the preliminary issues and I have taken this into consideration when making the costs order.
21. The application to vacate the hearing and set aside the preliminary issues, in my view, was predominantly due to the late change in the Claimant’s legal representatives. This was another point raised by the parties in relation to the costs of determination of the preliminary issues but I have already commented on this at paragraph 34 of my 8 April 2020 judgment. As I have explained above, issues before the Court required early determination and will be of assistance of the Court when determining the issues and focus the parties.
22. Looking at the overall picture, the relative “success” of the Claimant and the conduct of the parties generally; in my judgment it would be fair, just and reasonable for the Defendant to pay 50% of the Claimant’s costs of the trial of the preliminary issues, to be assessed on a standard basis.
The Withdrawn Application
23. As referenced above, the conduct of the parties when dealing with the determination of the preliminary issues also falls to be considered in relation to the Withdrawn Application. All orders of this Court must be given due consideration and respect. Whilst I accept that the Claimant had recently changed legal representatives, the obligation to comply with the Court’s order remained. The purpose of the Case Management Order was to ensure efficiency of the hearing to determine the preliminary issues.
24. I do not seek to repeat my findings on the conduct of the parties. I take into account the Claimant’s representatives numerous failures and obstructive attitude in failing to comply with the Case Management Order. The Withdrawn Application was withdrawn but was only made due to the lack of compliance by the Claimant. Although I accept the Claimant’s lack of compliance culminated in the making of the application, in the context of the other case management directions, the failure to file an opening statement was a relatively minor breach. In failing to file an opening statement, in addition to the skeleton argument, the Claimant himself lost an additional opportunity to put forward further submissions to the Court. There was no need to make an application for relief from sanctions in breaching this direction as no express sanction was imposed under the terms of the Case Management Order or the RDC. I am satisfied, given the wholesale non-compliance and obstructive approach to the Case Management Order, that the Claimant is not entitled to his costs of the Withdrawn Application.
25. I consider that the purpose of making the Withdrawn Application was not so much as to ensure the filing of an opening statement by the Claimant’s representatives but more so to ensure compliance and respect to the Court’s order. By the time of the Withdrawn Application the addition of the opening statement would not have substantially added to the proceedings, unlike the skeleton argument and preparation of the bundle. I am, therefore, of the view that it was not strictly necessary to make the Withdrawn Application. But, in taking the Claimant’s lack of compliance of the Courts Case Management Order and the initial reasons for filing the application into account, I order that both parties bear their own costs in relation to the Withdrawn Application.
Conclusion
26. In considering the success of the Claimant in the determination of the preliminary issues and the conduct of all the parties; I consider that the appropriate order would be to award the Claimant 50% of his costs of the trial of the preliminary issues, to be assessed on a standard basis. Such costs are to be assessed by the Registrar, if not agreed.
27. As to the Withdrawn Application; I have further taken into account the conduct of the parties and my order is that both parties are to bear their own costs.