Goodridge & Beadle (No 2)

In *Goodridge & Beadle (No 2)*, the applicant sought orders for indemnity costs against the respondent, who was bankrupt, and against a third party described as a "person of straw". The applicant also sought costs against the respondent's solicitor. The proceedings concerned an application for indemnity costs, and the court was required to consider the principles governing such applications, particularly in circumstances involving a bankrupt party and a party with no assets, as well as the potential liability of a solicitor for costs.

The central legal issues before Wilson J were: firstly, whether indemnity costs should be awarded against the respondent, a bankrupt, and the third party, a person of straw; and secondly, whether the respondent's solicitor should be held liable for the costs of the proceedings. The court had to determine the circumstances under which a court may depart from the usual rule that costs follow the event and order indemnity costs, and the principles applicable to making costs orders against non-parties, including solicitors.

Wilson J canvassed the relevant principles for awarding indemnity costs, noting that such an order is exceptional and requires conduct that is unreasonable, vexatious, or otherwise deserving of censure. The court considered the financial position of the respondent and the third party, and the implications of ordering costs against parties who may be unable to satisfy such an order. Regarding the solicitor's liability, the court examined the principles under which a solicitor might be ordered to pay costs, which typically involve misconduct or a failure to act in accordance with their duty to the court. The court's reasoning focused on the need for a strong justification to depart from the ordinary costs rules and to impose liability on a solicitor.