A costs order was sought by the bank against the sole shareholder and funder of the borrower. The court found that the shareholder concealed information so that the borrower could remain in occupation of the property for as long as possible.
The court held that this justified an order for indemnity costs against the company but not an order for costs against the shareholder.
The law is that cost orders will not generally be made against non-parties unless the litigation was unreasonable or improper or there was an abuse of process. The court held that it was not an abuse of process merely for a sole shareholder to fund a company’s claim and his delinquency did not constitute an abuse of process.