Ivanishvili and ors v Credit Suisse Life (Bermuda) Ltd
| Jurisdiction | Bermuda |
| Judgment Date | 01 March 2021 |
| Docket Number | Civil Jurisdiction 2017 No 293 |
| Court | Supreme Court (Bermuda) |
[2021] Bda LR 16
In The Supreme Court of Bermuda
Civil Jurisdiction 2017 No 293
Mr J Smouha QC, Ms S Hurrion and Mr H Komansky for the Plaintiffs
Mr S Moverley Smith QC, Mr J Wasty, Ms H Tildesley and Ms L Olander for the Defendant
The following cases were referred to in the judgment:
Binns v Burrows [2012] Bda LR 3
DeGroote v Macmillan and ors [1993] Bda LR 66
Phoenix Global Fund Ltd v Citigroup Fund Services (Bermuda) Ltd [2009] Bda LR 70
SCAL Limited v Beach Capital Management Limited [2006] Bda LR 93
Re Sphinx [2009] CILR 178
Fortunate Drift Ltd v Canterbury Securities Ltd (unreported, Cayman Grand Ct FSD 11 June 2020)
Athene Holding Ltd v Siddiqui [2019] Bda LR 3
Test for awarding indemnity costs of entire action — Test for awarding indemnity costs for interlocutory application — Test for making an order that costs should be paid forthwith
RULING of Hargun CJ
1. On 22 December 2020 I handed down a Ruling (“the Judgment”) in relation to nine separate applications dealing with various interlocutory matters. This Ruling deals with matters arising from the Judgment and various subsequent summonses. The factual background to this action is set out in paragraphs 3 to 15 of my Ruling in relation to the strike out application dated 13 September 2018 and in paragraphs 2 to 4 of the Judgment.
2. The matters before the Court are:
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i. Finalisation of the Order arising from the Judgment;
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ii. Costs arising from the Judgment;
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iii. Directions in relation to the application to vary paragraph 5 of the Order dated 2 June 2020;
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iv. Consideration of the draft order inviting the Court to case manage and hear together action no. 2017: 293 (“the Main Proceedings”) and action no. 2020: 373 (“the Misrepresentation Proceedings”);
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v. Credit Suisse Life (Bermuda) Limited's (“CS Life”) application for leave to appeal the Judgment; and
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vi. CS Life's application in respect of the Plaintiffs' failure to delete qualifying words from the amended Statement of Claim as indicated in the Judgment.
3. The terms of the order appended to the skeleton argument of the Plaintiffs are agreed by the parties (other than the issue of costs). I confirm the agreed terms as appearing in paragraphs 1 to 26 of the draft order. I confirm that in paragraph 12 the words “excluding its Defence on the amendments leave for which will be determined at trial” should remain in the order. In relation to paragraph 25, the trial of this matter is now fixed to commence on 15 November 2021 with a time estimate of 5 weeks.
4. The application for costs raises three separate issues: (a) whether the Plaintiffs should be entitled to costs in respect of certain applications determined by the Court and as set out in the Judgment; (b) if the Plaintiffs are entitled to costs in relation to certain applications, whether those costs should be assessed on the indemnity basis; and (c) if the Plaintiffs are entitled to costs in relation to certain applications, whether those costs should be taxed and paid forthwith.
5. As noted in paragraph 74 of the Judgment, Kawaley CJ in Binns v Burrows[2012] Bda LR 3, summarised the relevant Bermudian costs principles and stated that the Court's duty in awarding costs will generally be to determine which party has in common sense or “real-life” terms succeeded; award the successful party its/his costs; and consider whether those costs should be proportionately reduced because, for example, they were unreasonably incurred or there is some other compelling reason to depart from the usual rule that costs follow the event.
6. As noted in paragraph 19 of the Judgment, CS Life sought extensive discovery in relation to bonus payments; emails and other forms of correspondence; notes of calls/meetings; telephone records; Raptor investments; account statements; investment agreements/contracts/profiles; and portfolios with third party banks/financial institutions.
7. At paragraph 94 of the Judgment, this application was dismissed by me on the basis that: “Having considered the affidavit evidence and submissions of Counsel, I have determined that this application fails both as a matter of principle and in relation to the individual categories of documents sought.”
8. In response CS Life contends that whilst it was not successful in obtaining an order for specific discovery, its application did result in the provision of further discovery by the Plaintiffs because they conceded that their existing discovery was deficient in various respects. CS Life contends that following the service of its specific discovery application the Plaintiffs produced their Third List of Documents dated 19 October 2020 including (1) account statements for New Frontier Asset Management AG showing payments made to Chista Enterprises Limited, this being one of the categories of documents requested at paragraph 1.1(a) of the summons; and (2) account statements for Mandalay Trust for the year ending 2012 as requested at paragraph 1.6 of the summons. CS Life also points to the Fourth List of Documents dated 5 January 2021 which contained telephone records showing communications between various Credit Suisse and Bank employees and Bidzina Ivanishvili and George Bachiashvili, this being the subject of paragraph 1.4(a) of the summons.
9. I am satisfied that these documents would have been produced had CS Life provided the draft summons to the Plaintiffs as requested in correspondence. In this regard it is to be noted that the Plaintiffs served their First List of Documents in December 2018 and no complaint was made in respect of that List until the letter from Appleby dated 18 March 2020, 15 months after the service of the Plaintiffs' List of Documents. The letter set out the alleged deficiencies in the discovery given by the Plaintiffs (as reflected in the summons) and took the position that unless the Plaintiffs confirmed within 7 days that they would provide the additional discovery requested “we will immediately apply to the Court for an order for specific discovery”.
10. The Plaintiffs' response to Appleby's letter of 18 March 2020 was provided in the letter from Hurrion, the Plaintiffs' Bermuda attorneys, dated 25 March 2020. This letter provided a comprehensive response by reference to each category of the documents sought to be discovered but stated that “in the event that your client remains intent to issue an application, we expect that you will provide us with a draft of any application such that we can attempt to deal with any alleged issues without wasting Court time and resources.” CS Life ignored this reasonable request and issued the application without any constructive engagement with the attorneys for the Plaintiffs.
11. In any event, I am satisfied that the discovery given in the Third and Fourth Lists of Documents bears no relationship to the extensive documentation sought in the discovery application and, in my judgment, provides no basis for denying costs to the Plaintiffs in respect of the entirely unsuccessful discovery application pursued by CS Life. Accordingly, in my judgment, CS Life should pay the Plaintiffs' the costs related to its specific discovery summons dated 17 July 2020.
12. In paragraph 87 of the Judgment I refused to make an order that the Plaintiffs provide further and better particulars to the 121 separate requests made by CS Life. The Judgment notes that a substantial number of requests for particulars were already answered in the form of amendments sought to be made to the Statement of Claim (category 4 amendments). The application for further and better particulars, as made by the summons, was dismissed. In the circumstances, the Plaintiffs are entitled to the costs related to the unsuccessful application for further and better particulars of the Statement of Claim.
13. In response, CS Life argues that whilst it was unsuccessful in the application it achieved a measure of success in relation to this application and points to the provision made by the Court enabling CS Life to obtain particularisation in relation to certain of its requests by ordering that the Plaintiffs' case would be particularised in its forensic accountancy report. It also points to the statement made by the Court that the Plaintiffs' pleading should not be left open ended by the use of qualifying words.
14. The Court took the view that the bulk of the particulars requested by the Defendant were, on a proper analysis, requests for evidence which are to be properly provided in the form of the forensic accountancy report. The Court did not consider that these requests were proper requests for particulars of the Statement of Claim. Accordingly, this is not the basis for denying costs to the Plaintiffs to which they would otherwise be entitled on account of an unsuccessful application for further and better particulars by CS Life.
15. Overall, I am satisfied that the Plaintiffs were the successful parties in relation to CS Life's application for further and better particulars of the Statement of Claim and there is no substantial reason why they should be denied the costs related to the application. Accordingly, CS Life should pay the costs of the Plaintiffs in relation to CS Life's unsuccessful application for further and better particulars of the Statement of Claim.
16. In paragraph 54 of the Judgment the Court...
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