England and Wales: Might Ordering Security for Costs Breach Article 6 of the ECHR?
By Peter Hornsey, Ward Hadaway
Where a defendant (‘D’) to an action suspects that a claimant will not, or cannot, pay the costs of the litigation in the event D successfully defends a claim, D may apply to the Court for an order for security for costs. When made, the order typically requires the claimant (‘C’) to pay money into the Court before the claim proceeds, in order to secure D’s position.
The courts may refuse to order such security if they consider it inappropriate to do so, but additionally, this power may also infringe C’s access to the Courts and the right to a fair and public hearing under Article 6 of the European Convention on Human Rights.
In Tolstoy Miloslavsky v United Kingdom, the European Court of Human Rights considered this very issue. Tolstoy had been ordered to pay very substantial compensation to the claimant, for libel. His appeal was made conditional on his payment of a significant sum as security for costs of the appeal. Tolstoy could not pay, so claimed a breach of Article 6.
The Court ruled that Tolstoy had had several fair court hearings; his appeal had no real prospect of success; and the security for costs jurisdiction fulfilled legitimate aims of protecting those who win such cases. There had been no breach of Article 6.
Therefore, adherence to traditional concepts of ‘natural justice’ makes a finding that such an order contravenes Article 6 unlikely. However, the Court did state that Article 6 may be breached if an order for security denied a party access to a Court of first instance.
Peter HornseyWard Hadaway, Newcastle upon Tyne, UK
T: +44 191 204 4000
Ward Hadaway is rated as one of the leading law firms in the UK by independent legal guides, Legal 500 and Chambers & Partners. The firm has acknowledged national experts across a wide range of specialist areas.
Peter Hornsey heads the Commercial Litigation team and has advised for over 25 years on all types of civil court procedures, including applications for appeal, applications for judicial review and applications for interim relief such as injunctions and search orders, for individuals and businesses of all sizes, from multinational companies to entrepreneurs. This includes shareholder and partnership issues, disputes involving restrictive covenants in employment contracts, cross-border patent disputes, fraud and defamation.
Published: Winter 2017 l Photo: Silvan - Fotolia.com