High Court Rules on Costs in AIB and Everyday Finance Case

High Court Rules on Costs in AIB and Everyday Finance Case

The High Court, presided over by Mr. Justice David Barniville, delivered a significant judgment on a costs issue in the case of Allied Irish Banks plc & Anor v. Bradley & Ors [2024] IEHC 179. This judgment followed a previous ruling on an application brought by Allied Irish Banks plc (AIB) and Everyday Finance Designated Activity Company (Everyday) for various reliefs arising from a settlement agreement dated 31st January, 2020.

In the Principal Judgment delivered on 14th April, 2023, the court addressed an application to substitute Everyday for AIB as the plaintiff in the proceedings, which was granted. The matter was subsequently listed for mention on 26th April, 2023, to make orders and deal with consequential applications. The solicitors for AIB/Everyday prepared and circulated a draft order reflecting the Principal Judgment, which was agreed upon by the parties except for the issue of costs.

On 12th May, 2023, the Malcomson Law Defendants, who were among the defendants in the case, were not prepared to deal with the costs issue and sought an adjournment. They argued that costs should not be awarded against them and Mr. Morrissey on a joint and several basis. The court granted the adjournment and directed written submissions on the costs issue, which were duly provided. The costs issue was heard on 13th June, 2023, and judgment was reserved.

The High Court order giving effect to the Principal Judgment was made on 12th May, 2023, and perfected on 9th June, 2023. Mr. Morrissey appealed the orders to the Court of Appeal, which dismissed his appeals and affirmed the High Court's orders. The Court of Appeal also directed that Mr. Morrissey should be liable for one set of costs in respect of the appeals.

In his judgment on the costs issue, Mr. Justice Barniville concluded that AIB/Everyday were entitled to their costs, having been entirely successful in their application. The Malcomson Law Defendants did not oppose the making of an order for costs against them and Mr. Morrissey but contended that costs should not be ordered on a joint and several basis. They also sought a stay on any order for costs affecting them pending the determination of the proceedings against them.

The court held that AIB/Everyday were entitled to an order for costs on the basis that they were entirely successful in their application. The judgment emphasized that the normal and default position where a party is entirely successful in an application or proceedings against more than one party is that the order for costs should be made on a joint and several basis, unless the respective responsibilities of each of the unsuccessful parties can readily and justly be identified and set apart.

The court rejected the Malcomson Law Defendants' arguments that a joint and several costs order would be unfair. The judgment noted that the Malcomson Law Defendants actively participated in opposing the orders sought by AIB/Everyday and urged the court not to proceed to make orders in circumstances where Mr. Morrissey sought to withdraw his consent. The court concluded that it would be fairer for the burden of the costs to fall on the Malcomson Law Defendants, as unsuccessful parties, than on AIB or Everyday, should Mr. Morrissey be unable to pay any or all of the costs.

Regarding the stay applications, the court granted a stay on the enforcement or execution of the order for costs against the Malcomson Law Defendants pending the determination of the proceedings in the High Court. However, the court refused Mr. Morrissey's application for a stay on the order for costs against him, noting that his appeal had already been dismissed by the Court of Appeal.

In summary, the High Court's judgment on the costs issue in Allied Irish Banks plc & Anor v. Bradley & Ors [2024] IEHC 179 underscores the principle that a party who is entirely successful in their application is entitled to an order for costs on a joint and several basis against the unsuccessful parties. The judgment also highlights the court's discretion in granting stays on cost orders pending the outcome of further proceedings.