Dolphin Quays Developments Ltd v Mills and others: CA 17 May 2007

The owner had agreed to sell a long lease of an apartment to the defendant. Part of the price was to be by way of set off of an existing debt, but ths was not set out in the contract. The claimant bought the land and the benfit of the contract from the original developer, and charged it to a bank, who in due course appointed receivers. It had been argued that the contract was unenforceable under the 1989 Act because the use of the set off was an integral part of the contract, but was not evidenced in writing. Having successfully defended his claim he now sought his costs from the bank who, although not parties, had the financial interest in the claim.
Held: The order was refused. The making of a third party costs order requires some ‘exceptional’ circumstance. What is ‘exceptional’ has to be ascertained by reference to the ordinary range of litigation which comes before the courts. The circumstances were not quite usual and were not speculative, and nor had there been any impropriety.


[2007] EWHC 1180 (Ch)




Law of Property Act 1925 109(2), Law of Property (Miscellaneous Provisions) Act 1989 2


England and Wales


CitedAiden Shipping Co Ltd v Interbulk Ltd (The ‘Vimeira’) HL 1986
Wide Application of Costs Against Third Party
A claim had been made against charterers by the ship owners, and in turn by the charterers against their sub-charterers. Notice of motion were issued after arbitration awards were not accepted. When heard, costs awards were made, which were now . .
CitedKnight v FP Special Assets Ltd 25-Jun-1992
(High Court of Australia) Two orders for the payment of costs had been made against the receivers and managers of the claimant in the action, Forest Pty Ltd, and the defendant to a counterclaim brought by the defendants to the action, Howe . .
See AlsoDolphin Quays Developments Ltd v Mills and others ChD 17-May-2007
. .
CitedMetalloy Supplies Ltd (In Liquidation) v MA (UK) Ltd CA 7-Oct-1996
A costs order against liquidator of company in litigation is only rarely to be given. The court should ask who is the ‘real’ party to the litigation.
Millett LJ said: ‘[An order] may be made in a wide variety of circumstances where the third . .
CitedDymocks Franchise Systems (NSW) Pty Ltd v Todd and others (No. 2) PC 21-Jul-2004
PC (New Zealand) Costs were sought against a non-party, following an earlier determination by the Board.
Held: Jurisdiction to make such an order was not complete. Where the order sought was against a . .
CitedGoodwood Recoveries Ltd v Breen CA 19-Apr-2005
A claim against the defendant for money owed to someone else had been bought by the claimant of which Slater, a solicitor, was a director and shareholder. The claim was pursued in the name of the claimant by Slater as its solicitor and principal . .
CitedPetromec Inc v Petroleo Brasileiro Sa Petrobras CA 19-Jul-2006
A Mr Efremovich, a third party to the action was ordered to pay the costs of Petrobras and Brasoil which on the failure of its claim against them had been ordered to be paid by Petromec. The judge found that Mr Efromovich controlled the proceedings . .
CitedBacal Contracting Ltd v Modern Engineering (Bristol) Ltd 1980
Costs were sought against the receivers as from the commencement of the winding up of the plaintiff, and were granted on the basis that if the claim had been continued by the liquidator the applicant would have been a secured creditor. . .
CitedAnderson v Hyde and Others CANI 2-May-1996
The defendant company was wound up after the receiver had been appointed and the liquidator declined to take over the defence to the action. The judge had refused an application for a third party costs order against the receivers.
Held: Had . .
CitedDonnelly and others v Weybridge Construction Ltd TCC 22-Mar-2006
Application for specific dicslosure order. . .
CitedBE Studios Ltd v Smith and Williamson Ltd ChD 2-Dec-2005
The claimant company had failed in its action. The court was asked to make a costs order personally against the principal director of the claimant who had controlled the litigation and funded it. He responded that no impropriety had been shown on . .
Lists of cited by and citing cases may be incomplete.

Land, Costs, Insolvency

Updated: 04 May 2022; Ref: scu.252383