LM Investment Management Ltd (receiver apptd) (in liq) v Drake (No. 2)

LM Investment Management Ltd, represented by a receiver appointed and a liquidator, brought proceedings against Drake. The dispute centred on the receiver's application for judicial advice regarding whether to proceed with an appeal against a trial judgment. Drake opposed the application, arguing that the court should not provide any advice on the matter. The court ultimately declined to offer any advice, leading to the consideration of the costs incurred by both parties in the application process.

The central legal issue was whether the costs associated with the application for judicial advice should be paid from the assets of the Fund on an indemnity basis. This involved an examination of the circumstances under which costs in such applications are typically awarded and the principles governing indemnity costs.

In determining the appropriate allocation of costs, the court considered the nature of the application and the outcome. Given that the court declined to provide the requested advice, and considering the complexities and the significant interest of the parties involved, the court ruled that the costs should be borne by the Fund on an indemnity basis. This decision ensured that both the receiver and liquidator, who had a vested interest in the outcome, would contribute to the costs in proportion to the work involved.

The court ordered that the costs of the application, incurred by both the receiver and the liquidator, be paid from the assets of the Fund on an indemnity basis. This ruling provided clarity on the financial responsibilities of the parties involved in the application for judicial advice.