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Friday 27th July 2001

SJ Berwin's litigation department acted successfully for Mr Rupert Chandler in an appeal from a decision of Deputy Master Farringdon ordering that he provide security of £125,000.

This is the first reported case on security for costs against an individual under the Woolf reforms. The new power allows the judge to order security against an individual if the court is satisfied that "the claimant has taken steps in relation to his assets that would make it difficult to enforce an order for costs against him."

This case also shows the court's willingness to construe the new Civil Procedure Rules in a manner consistent with the Human Rights Act and Article 6 of the European Convention on Human Rights which provides for the right to a fair trial.

Partner Hilton Mervis, who led the case assisted by Chris Tayton, commented:

"This case gives useful guidance in using the new procedure. It clearly limits the ability of defendants to use the new power as a way of preventing a claimant's access to justice. It will be necessary to show that recent relevant "steps" have been taken rather than relying on alleged general dishonesty or historic conduct of a claimant. When security is awarded, it would be in a form which was "proportionate" to achieving the objectives of the rule which may well entail "freezing" assets rather than forcing them to be sold in order to provide security by way of payment into court."

• The case resulted in the following guidance being given in relation to CPR 25.13(2)(g):
• It was not sufficient to show that a claimant had been generally dishonest or taken steps in the past to deny the existence of his assets. It would be necessary to show that actual "steps" had been taken.
• It was left open as to whether it would be necessary for there to be an intention to make enforcement difficult in order to fall within the rule, although if the rule was interpreted in that way the Court would always have a discretion not to make an award.
• In construing what the legislature must have intended by the rule, the Court would have regard to the fact that it should be construed in a way most consistent with the objectives of the Human Rights Act and article 6 provided for the right to a fair trial.
  Even on the basis security ought to have been awarded, the "proportionate" manner of meeting the objective of the section was to allow assets covering the value of security to be charged, rather than the usual requirement for a bank guarantee to be provided or for the assets to be sold in order that a payment into court could be made.
• S J Berwin's Commercial Litigation Department was recognised by Chambers in their 2000 edition as being in the top band of law firms with under 40 litigators. The Commercial Litigation and Dispute Resolution practice at SJ Berwin has 11 partners and over 20 associate lawyers. T
• he department has always been at the cutting edge of developments in commercial litigation in the UK: it was the first UK law firm to take advantage of the change in the rights of audience and introduce an in-house advocacy capability for the purpose of representing clients at High Court hearings.
• SJ Berwin was also one of the first law firms to identify the need to explore alternative ways of resolving our client's commercial disputes by building what is now recognised as one of the top practices in Alternative Dispute Resolution (ADR).
• SJ Berwin was founded in 1982 and is a full-service international legal practice with 119 partners and more than 430 lawyers. It has offices in London, Brussels, Frankfurt, Berlin, Munich, Madrid and Paris. Further information about the firm may be found at www.sjberwin.com.