The claimant sued for breach of trust. The action was re-instated after being struck out for want of prosecution, but in the meantime the defendant had been made bankrupt and then discharged from bankruptcy. An order for costs was then made which the claimant now sought to enforce.
Held: The possibility of a future costs order was not a liability, contingent or otherwise, at the date of the bankruptcy and was therefore not a debt from which Mr Glenister’s discharge from bankruptcy released him. Under Order 62 Rule 3(2) the claimant had no right to recover the costs except under an order of the court. Whether or not to award costs was entirely in the discretion of the court. Unless and until the court exercised its discretion to make an award of costs, no debt of any kind existed. The making of an order for costs by a court could be seen as a contingency, in the sense of being something that might happen in the future, but it was not a contingent liability. Thorpe LJ said that a distinction had to be drawn between a liability and the risk of a liability.
Gazette 19-May-1999,  EWCA Civ 1221,  Ch 76,  3 WLR 716,  BPIR 674,  3 All ER 452
Rules of the Supreme Court Ord 62 r3(2), Supreme Courts Act 1981 51
England and Wales
See Also – Rowe v Glenister and Others CA 7-Aug-1995
Mrs. Rowe sued Mr. Glenister for breach of trust. The judge struck out the action for the want of prosecution.
Held: A witness’s memory loss is not itself a sufficient reason to strike out an action for want of prosecution. A defendant seeking . .
Distinguished – Haine v Secretary of State for Business Enterprise and Regulatory Reform and Another; Day v Haine CA 11-Jun-2008
Former employees had obtained a protective award against the company for failing to consult on the impending redundancies and submitted proofs of debt to the liquidator who sought guidance from the court. The judge had held that since the Act . .
Cited – Casson and Another v The Law Society Admn 20-Oct-2009
Two solicitors had been made bankrupt and then discharged from bankruptcy. They suffered adjudications by the SDT awarding compensation for matters occurring before the bankruptcies. They appealed, saying that the awards were bankruptcy debts from . .
Applied – Steele, Regina (on the Application of) v Birmingham City Council and The Secretary of State for Work and Pensions CA 16-Dec-2005
The claimant had received an overpayment of benefits (Job seeker’s allowance), but then was made bankrupt. He now said that this was a debt in the bankruptcy.
Held: It was not. At the date of the bankruptcy order, the possible reclaim was not . .
Cited – McCartney and Unite The Union and Another v Nortel Networks UK Ltd (In Administration) ChD 22-Apr-2010
The administrators gave employees of the company notice of termination of their employment. Then administrators refused consent under para 43(6) to actions against the company in the Northern Ireland Industrial Tribunal for protective awards, unfair . .
Cited – In re T and N Ltd and Others, Re Insolvency Act 1986 ChD 14-Dec-2005
The court considered the case of Glenister and similar and said: ‘I accept the submission that these cases are not in point to the issue as regards future asbestos claims. There is no element of discretion as regards such claims. If the ingredients . .
Disapproved – In re Nortel Companies and Others SC 24-Jul-2013
The court was asked as to the interrelationship of the statutory schemes relating to the protection of employees’ pensions and to corporate insolvency.
Held: Liabilities which arose from financial support directions or contribution notices . .
Cited – BPE Solicitors and Another v Gabriel SC 17-Jun-2015
Application for directions in a pending appeal. The claimant alleged negligence against his former solicitors. After his successful claim was substantially overturned on appeal, he was made bankrupt.
Held: If the trustee adopted and pursued . .
These lists may be incomplete.
Updated: 20 May 2021; Ref: scu.80871