Security for Costs

March 2, 2017

Often when I am acting for a defendant in civil Court claims, the issue arises whether the claim has substance and if the defendant wins, can the plaintiff pay any costs which are awarded? If the plaintiff is a company, I will investigate whether it has assets which could be realised to meet such costs at a future date. Usually, any application to the Court that security for costs should be ordered is made at the earliest time. Such an application often can be met by a director of the plaintiff company going guarantor. If however the Court is satisfied that security for costs (such as paying an amount in the Court Registry or providing a bank guarantee) should be ordered, then the usual practice is that the claim is stayed until the costs have been secured.

So the lesson is that, if your company commences a claim, it can expect the question of security for costs being raised. If you are defending a claim, ask whether security for costs is appropriate.

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