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Security for Costs: A Valuable Defence or a Burdensome Relic?

Published online by Cambridge University Press:  21 May 2009

K. Siehr
K. Siehr
Affiliation:
Dr. iur. (Hamburg), M.C.L. (Ann Arbor); Professor of Law, University of Zürich
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Extract

The dilatory defence of security for costs is a burdensome relic. It should therefore be abolished. If such a radical reform is not possible more appropriate rules should govern. These rules may be expressed in the following terms:

Upon application by the defendant the judge may at his discretion order security for costs. No security is ordered if

1. the plaintiff has local funds to meet his potential liability for costs, or

2. the local decision for reimbursement of the defendant is enforceable in the State of the plaintiff's place of business, or

3. the suit in local courts of the defendant's place of business is not frivolously brought.

Type
Research Article
Information
Netherlands International Law Review , Volume 39 , Special Issue S1: Law and Reality , October 1992 , pp. 291 - 300
Copyright
Copyright © T.M.C. Asser Press 1991

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References

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24. This is true, e.g., for Chile, Ecuador and Peru.

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29. The English Chancery Division expressly stated mat ordering security for costs is not, in the ordinary case, in any sense designed to provide a defendant with security for costs against a plaintiff who lacks funds: Porzelack KG v. Porzelack (U.K.) Ltd., supra n. 22, at p. 422.

30. The defendant needs no protection where the plaintiff holds real property within the forum State: cf., e.g., Art. 16 French Code Civil (now abrogated).

31. If reciprocity is granted by the State of the plaintiff's nationality or residence, no security for costs may be asked for: cp. s. 110(2) no. 1 German Code of Civil Procedure, supra at n. 4.

32. If the plaintiff sues in forma pauperis, he is also relieved from giving security for costs: cp. s. 122(1) no. 2 German Code of Civil Procedure, supra n. 4.

33. In a counterclaim of a defendant the defendant as plaintiff of the counterclaim need not give security for costs: cp. s. 110(2) no. 3 German Code of Civil Procedure, supra n. 4.

34. According to the original version of Art 16 French Civil Code (now abrogated) in commercial matters no security for costs had to be given. This was changed in 1895.

35. Actes de la Deuxième Conférence de La Haye chargée de réglementer diverses matières de droit international privé (25 juin — 13 juillet 1894) (The Hague 1894) p. 29.Google Scholar

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39. Trb. 1961 no. 122, p. 2.

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46. Cf., e.g., Geneva UN Convention of 28 July 1951 Relating to the Status of Refugees, 189 UNTS 137; Trb. 1951 no. 131.

47. Art. 31(5) Geneva Convention of 19 May 1956 on the Contract for the International Carriage of Goods by Road (CMR), 399 UNTS 189; Trb. 1957 no. 84; Art. 9(2) New York UN Convention of 20 June 1956 on the Recovery Abroad of Maintenance, 268 UNTS 3, 32; 649 UNTS 330; Trb. 1957 no. 121.

48. Cf., e.g., Art. 45 EEC Judgment Convention of 1968, supra n. 23 (version of 25 October 1982): OJ No. C 97 of 11.4.1983.

49. Cf., e.g., Art. 8 of the Agreement Between the Government of die Federal Republic of Germany and the Government of the French Republic in Order to Simplify Judicial Co-operation Under the Hague Convention of 1 March 1954 on Civil Procedure, BGBl, part II (1961) p. 1041: extension of provisions on security for costs to legal persons (juristische Personal, les personnes morales).

50. Cf., e.g., Art 14 German-British Treaty on Judicial Co-operation of 20 March 1928, Reichs-Geseablatt, part II (1928) p. 623Google Scholar; BGBl, part II (1953) p. 116.

51. Supra, at n. 26.

52. Cf., e.g.; Art 16 French Code Civil (original version); already in die same sense Parlement de Bordeaux 1 March 1777, reported by Merlin, M., Recueil alphabétique des questions de droit, vol. 1 (1819) p. 391 subGoogle Scholar: Caution judicatum solvi § 1, para. 3.

53. Cf., e.g., Porzelack, v. Porzelack, , supra n. 22.Google Scholar

54. Supra, at n. 3.

55. Similar and very early approach shown by Palement de Bordeaux, 1 March 1777, supra n. 52.