Costs And Interlocutory Injunction Applications

Introduction

The High Court recently considered the principles applicable to making an award for the costs of an interlocutory injunction application.1 The decision confirms that although the applicable rules provide that the court should make a determination as to costs in such cases (subject to an important qualification), it may not always be appropriate to do so. The decision also confirms that in applicable cases it may not always follow that a successful party in an interlocutory injunction hearing is awarded their costs.

The decision arose out of an unsuccessful application by the plaintiffs for an interlocutory injunction. Judge Barrett determined the question of the costs of the application as a separate matter and observed that although it is "always tempting to decide a costs application on-the-spot", since parties expend significant sums in litigating they "are entitled to a considered, reasoned decision even as to costs, in fact perhaps especially as to costs". Barrett felt that this observation applied "with even greater truth when it comes to the somewhat tortured issue of whether or not to order costs following an application for interlocutory relief". He then proceeded to analyse relevant authorities in considering the question of costs.

Law

Barrett's starting point with regard to relevant authorities was Order 99, Rule 1 of the Rules of the Superior Courts, which as a general principle provides that costs are at the discretion of the courts. However, Order 99, Rule 1(4A) states that in determining any interlocutory application the court "shall make an award of costs save where it is not possible justly to adjudicate upon liability for costs on the basis of the interlocutory application".

Barrett noted that this principle applied to all interlocutory applications, and from which important qualifications and distinctions arose from other cases.

In seeking its costs, the successful respondent/defendant relied on Haughey v Synnott.2 In this case, Judge Laffoy referred to Delany & McGrath's Civil Procedure in the Superior Courts in identifying that the 'shall' in Order 99, Rule 1(4A) requires the court to adjudicate on costs in respect of interlocutory applications and it is permissible to reserve costs only where it is impossible at that juncture to justly adjudicate on the costs of the application.3 She further cited the textbook with regard to the factors relevant to dealing with costs in interlocutory applications as a...