BRITISH VIRGIN ISLANDS
COURT OF APPEAL
BVI LITIGATION & RESTRUCTURING – COMMERCIAL LAW – APPEAL – ASSESSMENT OF COSTS – BURDEN OF PROOF IN COST ASSESSMENT PROCEEDINGS – WHETHER THE LEARNED JUDGE EFFECTIVELY REVERSED THE BURDEN OF PROOF AND REQUIRED THE PAYING PARTY TO PROVE THAT THE DISPUTED ITEMS OF THE CLAIM WERE UNREASONABLE AND SHOULD NOT BE ALLOWED – WHETHER THE LEARNED JUDGE MADE ERRORS IN PRINCIPLE IN CONDUCTING THE COST ASSESSMENT PROCEEDINGS – WHETHER THE LEARNED JUDGE IMPROPERLY EXERCISED HIS DISCRETION DURING THE COST ASSESSMENT PROCEEDINGS
In Sheikh Mohamed Ali M Alhamrani and others -v- Sheikh Abdullah Ali M Alhamrani the Court of Appeal considered an Appeal against the assessment of costs arising from unfair prejudice proceedings, a subsequent appeal to the Court of Appeal, as well as an injunction application. The costs awarded at first instance amounted to US$9,361,244.02 (plus interest). The Court of Appeal’s Judgment provides some useful guidance for practitioners in relation to costs assessment.
The Appellants complained that the trial Judge had effectively reversed the burden of proof and required them, as the paying party, to prove that disputed items of the costs claim were unreasonable and should not be allowed.
The Court of Appeal held that Part 65.2 of the Civil Procedure Rules, 2000 (“CPR”) sets out where the burden of proof lies in an assessment of costs and outlines the principles that the assessor should follow and that there was no room for the application of Rule 44.3 of the CPR, which covers substantially the same point. Rule 44.3 provides that in an assessment on a standard basis, any doubt as to whether any costs were reasonable and proportionate in amount should be resolved in favour of the paying party. This case makes clear that that rule does not apply in BVI.