Security For Costs – The Proper Approach To Assessing A Plaintiff's Ability To Pay Costs

Introduction

Atin Investments Limited v Remcoll Capital Limited and Garlin Investments ICAV [2022] IEHC 357 involved a dispute relating to the termination of a service level agreement between the plaintiff (Atin) and the first named defendant (Remcoll). Remcoll had entered the agreement in its capacity as an investment advisor to the second named defendant (Garlin). Remcoll unilaterally terminated the contract with Atin. Atin instituted proceedings claiming breach of contract against Remcoll and Garlin arising from the termination of the contract, and a claim against Garlin for the tort of inducement of breach of contract (Proceedings).

The Security for Costs Application

Garlin brought a security for costs application under section 52 of the Companies Act 2014 (Section 52 Application) on the basis that Atin's financial position was such that it would be unable to meet Garlin's costs, if it successfully defended the claim.