Home Information Cases Gorbunova v Berezovsky (2013)

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Gorbunova v Berezovsky (2013)

Summary

A defendant who successfully applied for discharge of that part of an injunction that froze his assets in general, but who remained subject to proprietary injunctions against three specified properties, had obtained a significant win in real terms and the claimant was ordered to pay 30 per cent of his costs of the application.

Facts

The court was required to determine costs following an application by the claimant (G) for a freezing injunction, which was discharged on an application by the defendant (B) and replaced by proprietary injunctions against three specified properties.

G and B had been in a long-term relationship. She brought proceedings claiming sums that she said B had promised to her. G had obtained a without notice injunction freezing B's assets up to £200 million, in addition to three specified properties. B applied to discharge the injunction on the basis that the evidence before the district judge had not been sufficient to merit a without notice application, that G had breached her undertaking to serve the order as soon as reasonably practicable, and that the scope of the injunction was too wide. The judge held that there had been no breach of the undertaking, that there was no sufficient risk of dissipation of the assets as a whole, but that there was a risk of dissipation of the three properties which had justified a without notice application and injunctive relief. The judge discharged the freezing injunction and made a proprietary order freezing the properties or the assets representing them.

B argued that he had been successful and so should have all his costs of the freezing order application, or, if he were ordered to pay G's costs, that the costs before the district judge should be reduced by 50 per cent.

Held

The starting point was the principle that the loser should pay the winner's costs, so it was necessary to identify who was the loser and who was the winner. A realistic rather than nit-picking approach should be taken, HLB Kidsons (A Firm) v Lloyd's Underwriters (Costs) [2007] EWHC 2699 (Comm), [2008] 3 Costs L.R. 427 applied. A failure to succeed on every point did not prevent a party from being a winner. In the instant case, it was more helpful to look at the overall dispute. B had not offered undertakings that were anything close to the terms of the proprietary orders granted. B had won to the extent of getting a significant freezing order discharged. G had failed in defending a very large-scale freezing order, but had retained some of the benefit. Costs could not sensibly be awarded for the costs of each application, because there was no discrete time or work on each application. Looking at the matter overall and in a realistic manner, B had been more of a winner than G. B had been faced with a very serious situation and his win had been more significant in real terms than G's. The appropriate costs order was that G should pay 30 per cent of B's costs, with the balance of both party's costs reserved. G was also ordered to make an interim payment of £59,500 in respect of B's costs of complying with the freezing order and satisfying the disclosure obligations. The costs before the district judge would not be reduced because there was no suggestion that there had been any significant increase in costs caused by making an order that was wider than it ought to have been.

Costs determined

Chancery Division
Mann J
Judgment date
11 February 2013
References

LTL 13/2/2013