A note on security for costs under Order 26 and on interim payments.
It is usually taken out by the when there is reasonable belief that the , who ordinarily is resident out of the , will be unable to pay cost to the defendant if ordered. This is to make sure that the plaintiff does not evade the consequences (costs) of the proceedings which was instituted.
By rule 2 it is obtained by a notice of motion or judge’s supported by an . The security is at the discretion of the court and may be given by a bank guarantee, bond, insurance guarantee or by any collateral.
It is discretionary and even if the requirements are meet, the court can still refuse, in the case of Harold G. Slone v. Arcadia Mining Company& Others MISC.
APP.355/2006 reported in Hon. Mr. Justice D.B. Edwards J held that “The / have clearly advanced cogent reason why security for costs ought to be given in that the petitioner / respondent is ordinarily and permanently resident abroad. But need I point out that application for security for cost is subject to the discretion of the Court and the rule is purposefully vague and elastic. Residence abroad is just a general rule subject to exceptions … the petitioner were to lose I would say the assets of the company to which he is a major shareholder should provide sufficient security for costs. I thus exercise my discretion in refusing the application for security for costs. The application thus fails.”
Transmarine Shipping and Trading Co Ltd v. The Owners and / or Persons Interested in the vessels "F/V Kawa", "F/V Nangbeto", "F/V Amou", "F/VAmoulome", "F/V Kozah" and "F/V Frosty" CC998/06 2006 SLHC reported in Hon. Mr. Justice D.B. Edwards J, the plaintiff was a Company in Greece and doing business out of Sierra Leone warranted the plaintiff given security for costs; for it will be difficult to enforce the payment if the Plaintiff/Respondent were to lose the action in consequence of which it was necessary that this Honourable court order that the plaintiff/ respondents are to pay security for costs within such time as this court may order.
In the case of Bank of Credit & Commerce International V The Charge D'Affaires of the Ivory Coast Embassy MISC. APP. NO.3/82 reported in Hon. Dr. Justice O.B.R. Tejan - J.S.C. Presiding, it was held that security for costs is not just limited to private individuals and also applies to a foreign envoy. A government, who comes in as a suitor, submits to the jurisdiction of the Court and to all orders which may properly be made.