Costs—Order for costs—Discretion

Court of Appeal, Civil Division, Richards, Tomlinson & Lewison LJJ, 29 Oct 2013

The Court of Appeal has considered the principles of making costs awards against non-parties to litigation.

Clive Freedman QC and Sam Neaman (instructed by Penningtons Manches LLP) for the claimant. Peter Shaw and Conn MacEvilly (under the Direct Access Scheme) for the defendants.

The claimant had been employed by the defendant company. He brought an action against the company and its sole director and shareholder, W (the second defendant) for breach of his employment contract. The company denied those allegations and counterclaimed for breaches of the claimant’s obligations of fidelity and breaches of his restrictive covenants. 

W was joined to the action because any order in the claimant’s favour for specific performance of his entitlement to the 20% equity sought by the claimant would have either required a transfer of shares by W himself, or would have had to have taken the form of requiring