Debarring orders in the Isle of Man – Practice & Procedure

Debarring orders are back in the (non-World Cup) news – with the important new English High Court decision in Beech Hill Capital Ltd v Lucas Duplan & others [2026] EWHC 1390 (Comm) (10.06.26) (see below).

Advocate Steven Coren of Coren Law – which (instructed by Charles Russell Speechlys LLP) successfully obtained debarring orders in Sodzawiczny v McNally & others (ORD 21/0028) (08.03.24) (unrep.) – reviews Isle of Man practice and procedure.

What is a debarring order?

A debarring order is a type of unless order, imposed for non-payment of a costs order. The debarred party is typically prevented from further participating in the proceedings until an outstanding costs order has been satisfied. It is a useful – albeit until recently in the Isle of Man rarely-used – Court enforcement power.

When have debarring orders been made on the Isle of Man?

Several debarring orders have been made on the Isle of Man in recent years.

One was made in Gittins & another v Montpelier (Trust and Corporate) Services Ltd (In Liquidation) (2DS 2020/11) (04.09.24). Judge of Appeal Cross KC held:

“54… the matters set out … in Michael Wilson & Partners Ltd v Sinclair & others [2017] EWHC 2424… apply here…

“(1) The imposition of a sanction for non-payment of a costs order involves the exercise of a discretion pursuant to the court’s inherent jurisdiction.

(2) The court should keep carefully in mind the policy behind the imposition of costs orders made payable within a specified period of time before the end of the litigation, namely, that they serve to discourage irresponsible interlocutory  applications or resistance to successful interlocutory applications.

(3) Consideration must be given to all the relevant circumstances including: (a) the potential applicability of Article 6 ECHR; (b) the availability of alternative means of enforcing the costs order through the different mechanisms of execution; (c) whether the court making the costs order did so notwithstanding a submission that it was inappropriate to make a costs order payable before the conclusion of the proceedings in question; and where no such submission was made whether it ought to have been made or there is no good reason for it not having been made.

(4) A submission by the party in default that he lacks the means to pay and that therefore a debarring order would be a denial of justice and/or in breach of Article 6 ECHR should be supported by detailed, cogent and proper evidence which gives full and frank disclosure of the witness’s financial position including his or her prospects of raising the necessary funds where his or her cash resources are insufficient to meet the liability.

(5) Where the defaulting party appears to have no or markedly insufficient assets in the jurisdiction and has not adduced proper and sufficient evidence of impecuniosity, the court ought generally to require payment of the costs order as the price for being allowed to continue to contest the proceedings unless there are strong reasons for not so ordering.

(6) If the court decides that a debarring order should be made, the order ought to be an unless order except where there are strong reasons for imposing an immediate order”.

55. These principles must also involve… consideration of other factors, namely, the overriding objective, the right of the winning party to reclaim their costs in accordance with the orders of the court and the need for finality.

56. Uppermost… will be an assessment as to whether the party cannot pay or will not pay… A judge must assess carefully the conduct of the allegedly defaulting party. This assessment is in my view not limited to the simple facts surrounding the default in relation to costs… Such a failure would of course demonstrate cogent evidence of intention. A judge though is entitled to look at the whole picture which may not only include the failure to honour obligations in relation to costs, but may also include other relevant financial matters…

57. As Chadwick LJ said in Chrystal Decisions (UK) Limited & Others v Vedatech Corp [2008] EWCA Civ 848 at paragraph [16]:

“… orders of the court, even in relation to interim costs, require to be complied with and … unless there is some overwhelming consideration falling within Article 6 that compels the court to take a different view, the normal consequence of a failure to comply with such an order, is that the court, in order to protect its own procedure, should make compliance with that order a condition of the party in question being able to continue with the litigation [my emphasis]”.

In Montpelier, the Judge of Appeal debarred the Appellants from participating in the proceedings, and prevented them from making further applications, if payment of the outstanding costs was not made within 14 days; extant applications by the Appellants would also be dismissed at the same time. He found (at § 61) that the First Appellant’s conduct as to costs orders of £240,504.97: “demonstrates contempt for orders of the court”. Other outstanding liabilities were considered, including 59 outstanding parking fines.

A few months earlier, in Sodzawiczny v McNally & others (ORD 21/0028) (08.03.24) (unrep.), Coren Law secured debarring orders against several Defendants owing £265,433.81 in outstanding costs orders.

At § 9, Acting Deemster Gough stated:

“The court has jurisdiction to make an unless order if a party fails to comply with a court order or to pay costs orders (Rule 7.2(3)(b) and Gama Aviation Ltd and anor v MWWMMWM Limited [2021] EWHC 2229 (Comm)). Mr Coren also relies on Rule 2.58 and the court’s inherent jurisdiction to prevent abuse of its process”.

[After citing the above principles in Michael Wilson, as cited in turn in Gama Aviation, above, he continued at § 11:]

“The court in Gama Aviation also stated the following at paragraph [20]

“…in general, orders of the Court, including orders in relation to interim costs, need to be complied with unless there is some form of ‘overwhelming consideration falling within Article 6’ that compels the Court to take a different view, the normal consequence of a failure to comply with such an order is that the Court should make compliance with that order a condition of the party in question being able to continue with the litigation. This course is necessary for the Court to be able to protect its own procedures”

and concluded at paragraph [23]…:

“… a defendant which contends that it lacks the means to pay, and therefore that a debarring order would be a denial of justice or a breach of Article 6 of the ECHR, bears the burden of proving that contention and to do so it must produce evidence which is detailed, cogent and proper and gives full and frank disclosure of its financial position. This would normally address the prospect of raising the necessary funds from elsewhere” “.

Later in Sodzawiczny v McNally & others (ORD 21/0028) (17.09.24) (unrep.) (§ 22), Acting Deemster Gough referred back to these debarring orders:

“… [Mr Sodzawiczny]… has succeeded in applications where I have ordered costs in his favour…. he is having the devil’s own job to collect those costs with most of the Defendants being abroad and frankly just ignoring the court’s orders. [He] is entitled to enforce these orders and to deploy the legal remedies available to him to do so. So egregious has been the behaviour of some… Defendants that I have made an order excluding certain parties from further engaging in this proceeding until they comply…”.

And the above principles from Michael Wilson were also cited by the Appeal Division in Clypse Farms Ltd (in receivership) & another v RBSI t/as Isle of Man Bank (2DS 2023/22) (13.11.23) (§§ 24-32). In Clypse Farms, in addition to an order for security for costs of £30,000, the Court made an “unless order” – in this case, a type of debarring order – dismissing an appeal, unless payment of outstanding costs of £61,790 were paid within 14 days.

Beech Hill Capital

An important contribution to English law on debarring orders – and likely to be persuasive in the Isle of Man – landed on 10th June 2026.

In Beech Hill Capital, Sharif Shivji KC, sitting as a Deputy High Court Judge, identified two distinct lines of authority on debarring orders:-

(1) An order under Hadkinson v Hadkinson [1952] P. 285, with origins in canon law. The jurisdictional conditions for a Hadkinson order were said (at § 16) to be:

“i) The respondent is in contempt;

ii) The contempt is deliberate and continuing;

iii) As a result, there is an impediment to the course of justice;

iv) There is no other realistic and effective remedy;

v) The order is proportionate to the problem and goes no further than necessary to remedy it.”

(2)  The line of authority based on the Court’s case management powers (eg. Michael Wilson).

Sharif Shivji KC referred at § 31 to an explanation by the renowned Paul Stanley KC, sitting as a Deputy High Court Judge in J Robbins Capital Partners Ltd v Zamsort Ltd , Ortac Resources (UK) Ltd , Arc Minerals Ltd [2024] EWHC 1990 (Comm), on the rationale behind the costs regime and why a court may exercise case management powers as to a party who fails to pay costs orders.

Drawing the two lines of authority together – in an analysis which will be highly persuasive in the Isle of Man – Sharif Shivji KC summarised applicable principles at § 33:

“i) The court can impose conditions on a party for failing to pay one or more prior costs orders in the same proceedings.

ii) This is a case management power which derives from the court’s inherent jurisdiction (Crystal Decisions… at [9], Michael Wilson… at [29(1)]) and its powers under CPR r.3.1(3)(b) and r.3.4(2)(c).

iii) This is the exercise of a judicial discretion and the court must consider all of the circumstances (Michael Wilson at [29(3)]).

iv) In particular, the court will have regard to:

    a) the policy behind the imposition of costs orders made payable within a specified period of time before the end of the litigation, namely that (i) it applies discipline to the parties in terms of which issues they decide to contest before the court if they have to bear to cost consequences of unsuccessfully doing so, (ii) it is on balance fairer that the reasonable and proportionate costs of an application should be met by whoever turns out to have been wrong (J Robbins Capital … at [10]);

    b) the importance of ensuring that court orders are complied with and that it diminishes the court’s authority and standing if the court then overlooks non-compliance by a party in the same proceedings (J Robbins Capital at [12]);

    c) all of the available options including other enforcement mechanisms outside the proceedings…  and the full range of possible orders within the proceedings designed to secure compliance with the court’s previous order(s)… (J Robbins Capital at [29]);

    d) the procedural behaviour of the defaulting party (Siddiqi at [30(iv)]. It is not to be assumed, however, that the mere existence of an adverse costs order accompanied by an obligation of immediate payment is itself indicative of any misconduct on the paying party (J Robbins Capital at [32]);

    e) the potential interference with a party’s right to a fair trial under Article 6 of the ECHR and the right to access civil justice (J Robbins Capital at [16]). This will usually arise where a party contends that they lack the means to pay and that therefore the application of conditions would be a denial of justice and/or in breach of Article 6; in short, a claim of stifling. Such a claim should be supported by detailed, cogent and proper evidence which gives full and frank disclosure of the party’s financial position including his or her prospects of raising the necessary funds where his or her cash resources are insufficient to meet the liability (Michael Wilson at [29(4)]). The approach taken in this regard is analogous to that taken in relation to security for costs (J Robbins Capital at [19] to [24]);

    f) the degree of connection between the unpaid costs in question and the claim or application in which the respondent wishes to participate: see Tonstate Group Ltd v Wojakovski [2020] EWHC 1004 (Ch) at [42]-[47]) (Zacaroli J), as cited in SFO v Litigation Capital at [63].

v) If the court decides to exercise its discretion, there are a range of options for orders within the proceedings. The court will be careful to ensure that its proposed order is proportionate (J Robbins Capital at [18]). The options include:

    a) striking out a claim or defence (as was sought in Peak Hotels and Resorts Ltd v Tarek Investments Ltd [2016] EWHC 690 (Ch) and Musion Systems… at [26]);

    b) debarring a defendant from defending (as in Crystal Decisions… and Michael Wilson v Sinclair);

    c) staying a claim until costs are paid (Siddiqi).”

Note for practitioners: Beech Hill Capital will likely be cited in, and relied on, in the Isle of Man on debarring orders. It may be anticipated that, along with strike outs and stays (amongst other case management tools), debarring orders may become more frequently used on the Isle of Man in future to deal with parties who default on costs orders.

Disclaimer: professional advice should be sought before applying any information in a given case.

For advice on Isle of Man civil procedure or enforcement, contact Coren Law.

See also Coren Law’s Isle of Man civil procedure portal: Click On | Coren Law.

Photo credit: Jan van der Wolf