Feb 2023
Sun Vessel Global Limited (Appellant) v (1) HQ Aviation Limited, (2) Great Lakes Insurance (UK) SE (Respondents) Judgment given on 9 January 2023
Court’s Jurisdiction to reconsider matters before delivery of its perfected order/judgment – Principles to assess costs where successful party has not succeeded on all grounds
Following oral judgment in BVIHCMAP2022/0017 Sun Vessel Global Limited v HQ Aviation Limited, Great Lakes Insurance (UK) SE (“the Appeal”), the Eastern Caribbean Court of Appeal was invited to reconsider its decision that there be no order as to costs, in circumstances where the parties each had a measure of success.
By way of background, the Respondents were successful on two out of three grounds of the Appeal concerning the rate of interest to be applied in light of section 404 of the BVI Merchant Shipping Act, 2001 where no limitation fund had been constituted (the “Interest Issues”). The Appellants on the other hand were successful on one ground, concerning the non-recoverability of costs incurred by non-admitted foreign lawyers.
Jurisdiction to Reconsider Decision Prior to Sealing
By its written judgment, the Court of Appeal confirmed that the jurisdiction to reconsider decisions on issues prior to the perfection of a final order was well established. Adopting the principles set out by the Supreme Court of England in Re L and B (Children) 2013 UKSC 8, the Court of Appeal confirmed that in exercising this jurisdiction, the overriding objective to ensure that cases are dealt with justly is the key consideration and there was no requirement to establish ‘exceptional circumstances’.
The Costs Issue
In this case, the Respondents sought to recover their costs of the Appeal in full. Alternatively, the Respondents sought an order that any reduction should be minimal since the Appellants had been successful on a minor point in the Appeal.
In monetary terms, the Respondents’ and the Appellants’ success in the Appeal accounted for at least US$564,183.71 and US$34,000.00, respectively.
The approach ultimately adopted by the Court of Appeal was to consider the case as a whole and the relief sought in the Appeal. In the present case, the relief sought was only financial in nature and the Court of Appeal opined that the respective financial outcomes of the parties were of utmost importance in determining the overall “winner” and this was determined to be the Respondents.
The Decision
As a result, the Court of Appeal awarded the Respondents 80% of their costs in the Appeal and considered the reduction in costs of 20% to be appropriate. The Court relied on Part 65.6(6) of the Eastern Caribbean Supreme Court Civil Procedure Rules 2000, which requires the court to take into account the fact that a successful party may not have been successful in the whole of the proceedings in determining the appropriate cost order to be made.
The Court also relied on its earlier decision in Rosalind Nicholls et al and Richard Rowe and Mark Secrist et al (delivered on 21 September 2018) which adopted the principle that the usual approach in the event of partial success is to award the successful party a proportion of its costs, rather than make an “issues-based” order. In the present case, the 20% reduction in costs awarded to the Respondents was considered to be a fair representation of the success of the Appellants in the overall appeal, the Court being of the view that the Interest Issues occupied a “…not insubstantial part of the argument before the Court as reflected in the submissions, authorities, and the judgment.”
Overall, this judgment provides useful clarification as to the principles to be applied by the court when invited to reconsider decisions before sealing judgments and when asked to exercise its discretion in assessing costs in cases where both parties realize some measure of success. Such additional certainty is particularly welcome in the context of cross-border commercial litigation.
A link to the full judgment is here.