Neutral Citation Number: [2008] EWHC 2795 (QB)
Case No: IHQ/08/0456
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 18/11/2008

Before :

THE HON MR JUSTICE TUGENDHAT
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Between :

	LINGFIELD PROPERTIES (DARLINGTON) Ltd	Claimant      	
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	PADGETT LAVENDER ASSOCIATES	Defendants	

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Mr Jason Evans-Tovey (instructed by Watson Burton LLP) for the Defendants
Mr Michael Hepker  in person

Hearing date: October 28th 2008
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Judgment
Mr Justice Tugendhat : 
1.	On 17 December 2007 I delivered a judgment [2007] EWHC 2989 (QB) (“the judgment”) dismissing the claim by the Claimant against the Defendants. On 22 May 2008 the Defendants applied by Notice for an order pursuant to CPR 48.2(1)(a) that Michael Hepker be joined as a party to these proceedings for the purposes of a non-party costs order against him pursuant to the Supreme Court Act 1981 s.51. The grounds on which the Defendants seek that order are, in summary, Mr Hepker’s involvement in the management and funding of the claim, the benefit which it is said was to be derived by him from it, and the allegations of impropriety which are set out below.
2.	At the end of the trial I ordered the claimant to pay the defendants’ costs on an indemnity basis’ including a payment on account of £350,000.  Solicitors for the Defendant have drawn up a bill of costs totalling £688,412.22p plus VAT.  Nothing has been paid, but that is not a figure which has been agreed between the parties or approved by the court.
3.	As appears from the judgment, this is not a case of an insolvent Claimant, or a Claimant which lacks assets.  The Claimant Company has a substantial asset in the form of the land around which the dispute, which is the subject of the judgement, revolved.  The Defendants have obtained a charging order over the land, but I am told that that charge is subject to a prior charge in favour of another creditor said to be claiming at least £100,000.  The Defendants have not sought themselves to force a sale.  They recognise that attempts are being made to sell the land.  No criticism was advanced before me on behalf of the Defendants of those efforts.  It is uncertain whether if a sale is made it will produce enough to discharge the debts of the claimant.  Mr Hepker states that it is only a matter of time before a sale of the land takes place at a figure sufficient to clear the claimant’s debts to the Defendants.
4.	For this reason Mr Hepker’s first point before me was that this application was premature.  That is not a point that has been raised, so far as I am aware, in any of the reported cases on the courts jurisdiction under Section 51. In the event I do not need to consider it.
5.	Mr Hepker takes a second preliminary point.  He submits that he should not be joined as a party because he does not fall within the category of persons against whom an order against Section 51 falls to be made.  In support of this submission he makes a number of points which go to the substantive question whether an order should be made.  It seems to me that this is a point which is based on a misreading of the rules.  
6.	CPR 48.2 (1) provides as follows: 
“Where the court is considering whether to exercise its power under Section 51 of the Supreme Court Act 1981 … to make a costs order in … against a person who is not a party to proceedings 
a)	that person must be added as a party to the proceedings for the purposes of costs only:
b)	he must be given a reasonable opportunity to attend a hearing at which the court will consider the matter further.”
7.	It is clear that the rule lays down only one condition for adding a person as a party to the proceedings, namely, where the court is considering whether to exercise its power under Section 51.  Clearly, there may be applications for orders under Section 51 which are so lacking in merit that the court will not consider whether to exercise its power at all, but will dismiss the application as misconceived.  That is not this case.  It is plain that I must consider whether to exercise the power and accordingly Mr Hepker must be joined.
8.	Mr Hepker takes the further point that he has not been given a reasonable opportunity to prepare his case.  He states that his understanding of the Application Notice was that there was to be a two stage hearing, one to consider joinder, and one to consider whether the order should be made.  He has put before the court a substantial witness statement of 25 single spaced pages dated 22nd October 2008, accompanied by a file full of exhibits.  He states that with what he submits would have been appropriate notice he would have wished to put before the court further matters.  
9.	The first further matter he wished to refer the court to is the bill of costs.  He submits that that shows that consideration was given by the defendants to an application for security of costs and they instructed accountants for that purpose.  All of this took place months before the trial.  He submits that it must have been clear at that stage that the only asset of the claimant available to meet an order for costs against it, if it failed in the action, was the land around which the underlying dispute revolved.  Mr Hepker also submitted that he would have wished to draw to the attention of the court that about half the expenditure of costs on behalf of the defendants had been incurred by about June 2007, which was when he was first advised that an application under Section 51 would be made against him.  He would also wish to draw to the attention of the court the terms of a contract between the claimant and Terrace Hill North East Ltd (“Terrace Hill”) dated 17th December 2003.  A copy of that contract is before the court in a bundle prepared on behalf of the defendants.  The contract includes a clause to which Mr Hepker wishes to refer, namely 3.2, to the effect that, unless the claimant received an opinion of leading counsel to the effect that its claim against the defendant would have less than a 50% chance of success, the claimant was obliged at its own cost to commence or continue the proceedings against the defendants, and to use all reasonable endeavours to secure the payment of damages to the claimant. The consideration for this undertaking was an agreement on the part of Terrace Hill to provide funding, including an initial payment of £200,000.  It was contemplated that in certain circumstances Terrace Hill might become involved in the development of the land.  
10.	After hearing Mr Hepker’s submissions on this point, Mr Evans-Tovey took instructions and agreed that the court could proceed with the Section 51 application on the basis that the matters which Mr Hepker said he wished to put before the court were not in dispute for the purposes of this application.  Accordingly I proceeded to hear the matter substantively on that basis.
THE LAW
11.	The Supreme Court Act 1981 Section 51 provides:
“(1) Subject to the provisions of this or any other enactment and to Rules of Court the costs of and incidental to all proceedings in … (b) the High Court… shall be in the discretion of the court.”
12.	 There is guidance to be found on the exercise of this discretion in a number of   cases But these cases must not be treated as a rule book or allowed to over complicate consideration of any other case: Petromec v Petroleo Brasileiro [2006] EWCA Civ 1038 paras 11 and 19. One important case is Symphony Group v Hodgson [1994] QB 179 at 191G to 194D.  The procedure is a summary procedure.  In this case that is significant, because there are a number of allegations made against Mr Hepker, both as to the degree of control which he exercised over the claimant’s litigation, and as to the propriety with which he has conducted it, which were not issues in the action.  Insofar as I have not made findings of fact in the judgment, but where there is now a dispute of fact, I do not have the benefit of disclosure of documents or cross examination or oral evidence. I am therefore unable to resolve such disputes.  
13.	On the other hand, whereas in some cases findings of fact as between the parties to the substantive dispute may not be admissible in relation to the dispute over costs, in the present case the issues in relation to this application are very closely linked to the evidence that Mr Hepker gave as a witness for the claimant in the action. The conclusions I reached as to his evidence in the judgment are ones which I can without injustice apply in the exercise of my discretion under Section 51.
14.	Mr Evans-Tovey summarised the guidance to be derived from the authorities, and there is no material dispute about the principles to be applied.  A non-party costs order is an exceptional order and the judge should treat any application for such an order with considerable caution.  A court may make a non-party costs order where there are exceptional circumstances making such an order reasonable and just in the circumstances, and in this context “exceptional” means no more than outside the ordinary run of cases where parties pursue or defend claims for their own benefit and at their own expense. See Symphony at p192-3 paras (1) and (2) and Dymocks Franchise Systems (NSW) Pty Ltd v.Todd (Costs) [2004] UKHL 39 para 25.  In that paragraph of the advice of the Privy Council considered the principles to be applied, in particular in relation to non-parties who had funded the litigation.  The advice refers to the public interest in the funded party getting access to justice, and to the public interest in the successful unfunded party recovering his costs and so not having to bear the expenses of vindicating his rights.  The latter is the public interest relied on by the defendant in this application.  
15.	The advice then goes on as follows:
“Where however the non-party not merely funds the proceedings but substantially also controls or at any rate is to benefit from them, justice will ordinarily require that, if the proceedings fail, he will pay the successful parties costs.  The non-party in these cases is not so much facilitating access to justice by the parties funded as himself gaining access to justice for his own purposes.  He himself is “the real party” to the litigation, a concept repeatedly invoked throughout the jurisprudence…. Nor, indeed is it necessary that the non-party be “the only real party” to the litigation… provided that he is “a real party in …very important and critical respects”…”
16.	In that advice there is also cited with approval a passage from the judgment of Millett LJ in Metalloy Supplies Ltd v MA (UK) Ltd [1997] 1WLR 1613 at 1620, as follows:
“[An order] may be made in a wide variety of circumstances where the third party is considered to be the real party interested in the outcome of the suit…. It is not, however, sufficient to render a director liable for costs that he was a director of the company and caused it to bring or defend proceedings which he funded which ultimately failed.  Where such proceedings are brought bona fide and for the benefit of the company, the company is the real plaintiff.  If in such a case an order for costs could be made against a director in the absence of some impropriety or bad faith on his part, the doctrine of the separate liability of the company would be eroded and the principle that such orders be exceptional would be nullified.  The position of a liquidator is a fortiori where a limited company is in insolvent liquidation, the liquidator is under a statutory duty to collect in his assets.  This may require him to bring proceedings…. If he brings proceedings in the name of the company, the company is the real plaintiff and he is not. He is under no obligation to the defendant to protect his interests by insuring he has sufficient funds in hand to pay their costs as well as his own if the proceedings fail.”
17.	There  are two further passages from the advice of the Privy Council that are of assistance:
“33… the authorities establish that, … any impropriety or the pursuit of speculative litigation may of itself support the making of an order against a non-party…
34…[citing] … Phillips LJ’s judgment in Murphy v. Young & Co’s Brewery PLC [1997] 1WLR 1591, 1603 -1604: 
“Funding alone will not justify an order against the funder under Section 51.  I do not consider that an order under Section 51 would normally be appropriate where a disinterested relative has out of natural affection, funded costs of a claim or a defence that is reasonably advanced.””
18.	Mr Evans-Tovey places particular emphasis on those passages in the authorities which refer to the non-party controlling the proceedings, deriving a potential benefit from them, acting with impropriety and pursuing “speculative litigation”.
19.	Mr Hepker places emphasis on the public interest in not imposing liability for costs on the officers of a company which has failed in litigation pursued in the interests of the company.  
20.	I also note that one of the principles set out in Symphony at page 193G is as follows:
“(7) Again, the normal rule is that witnesses in either civil or criminal proceedings enjoy immunity from any form of civil action in respect of evidence given during those proceedings.  One reason for this immunity is so that witnesses may give their evidence fearlessly:… insofar as a witness in proceedings may lead to an application for the costs of those proceedings against him or his company, it introduces yet another exception to a valuable general principle ”.
OWNERSHIP AND CONTROL OF THE CLAIMANT AND THE PROCEEDINGS
21.	As stated in the judgment at para 12, the claimant  company had been acquired in 1988 by Oakdean Properties Limited, which was in turn owned by the Hepker Children’s Trust.  In 1989 and 1990 it had a significant turnover and the directors were Mr Hepker, a Mr Cartwright and a Mr Smith.  As further stated, in paragraph 79, the last year for which the accounts for the claimant show any income other than interest is the year ending 30th March 1990.  For that year there is shown a rental income of £167,014.  For the year ending 30th March 1991 there is shown income by way of interest of £1,125,671.  Mr Smith resigned as a director on 31st October 1991.  In the period ending 30th March 1992 and all subsequent years with which I was concerned, there is a nil turnover.  Mr Hepker resigned as a director on 24th November 1994.  In the judgment I have mistakenly stated that two of his children JL and HB Hepker were appointed directors on 17th November 1994.  JL Hepker is one of Mr Hepker’s daughters and a beneficiary under the Hepker Children’s Trust.  But Mr HB Hepker is a brother of Mr Hepker. He is not a child or a beneficiary under the Trust.  Mr Cartwright resigned as a director, and Mr Hepker became company secretary.  I then stated as follows in the judgment at para 79:
“From then on Mr Hepker was the only person through whom the claimant acted.  He acted with the authority of the board.  There is nothing to indicate from what resources the claimant       was able to discharge its obligations.  I was informed that the expenses of the claimant were funded by the Hepker family.”
22.	In the present proceedings the defendants challenge that Mr Hepker did act with the authority of the board in any real sense.  And I have been told in these proceedings that the expenses of the claimant in this litigation were initially funded by La Sande (whose interest is set out in the judgment at para  74) until February 2003, and that after December 2003 the expenses of the action were funded by Terrace Hill, pursuant to the agreement dated 17th December 2003.  See para 53 of the witness statement of Mr Hepker dated 22nd October 2008.  
23.	Mr Hepker drew my attention to a number of documents signed by persons other than himself. First, there are the financial statements for the claimant       for the year ended 31st December 1995, which were signed by two directors, Mr Hepker’s daughter JL Hepker, and a Mr Foster. The third director at that time was Mr HB Hepker.  Next are the abbreviated accounts for the year ended 31 March 2005, which state that they were approved by the board on 15th January 2007. They are signed by Mr HB Hepker.  Next is the Fixed Charge over the land of the claimant which was dated 17th December 2003. This is a deed of charge between the claimant and Terrace Hill.  The deed was executed on behalf of the claimant in the presence not only of Mr Hepker, who is described as Secretary, but also his daughter Jennifer Hepker, who signed as Director.  
24.	Mr Hepker produced a witness statement dated 28 July 2008 from Mr HB Hepker.  He states that he and his son Adrian Hepker are directors of Oakdean Properties Limited and he is a director of the claimant and other associated companies.  The statement continues:
“My brother Michael Z Hepker, is not a director of any of these companies.  He is the only person who knows at first hand the complete story of exactly what happened to the land at Darlington over the last 20 years.  We have been kept abreast of everything that has transpired over this period together with suggestions of what he felt we should do.  However, all decisions have been made by the board and not by him.  With regard to the case which we brought before the High Court of England against the Local Council, and also with regard to this legal action, my brother has been carrying out my instructions.  You may also be unaware that he did all this work not for self gain but for the benefit of his beloved children, namely Jennifer  Caroline and Juliet”.
25.	There is a witness statement of the same date by Adrian Hepker.  It reads:
“I am a director of Oakdean Properties Limited, who are the owners of all the shares in the Lingfield Companies, including the company involved in this case.
Michael Hepker, my uncle, has never been a director of Oakdean nor has he ever received any payments or salary from Oakdean.
In the event that Lingfield Properties (Darlington) had won this legal action, and dividends had been paid to the shareholders of Oakdean then these monies would not have been paid to my uncle.  
Any dividends paid to the shareholders, would have been shared equally by my cousins i.e. Jennifer, Caroline and Juliet Hepker.  Those have always been my father’s and uncle’s intentions”.
26.	Mr Hepker informed me that his three daughters are all highly educated and that they now occupy responsible positions in different and demanding walks of life.
27.	The defendants in the summary proceedings have not challenged any of this information given by or about members of the Hepker family.  Nor am I aware of any basis upon which they could have challenged any of this information.  Mr Evans-Tovey invites me to be sceptical on the grounds that there are no contemporaneous documents showing involvement of any individual other than Mr Hepker or, in one particular instance his daughter Juliet, and that Mr HB Hepker and Mr Adrian Hepker give addresses in South Africa.  There have been no board minutes produced in respect of any of the companies. The one incident in which one of Mr Hepker’s daughters was involved is described in para 172 of the judgment.  She was involved in the instructions given to Mr Tweedale.  
FINDINGS OF FACT IN RELATION TO MR HEPKER
28.	Mr Evans-Tovey reminds me of a number of passages in the judgment which I have spoken of Mr Hepker.  These include paras 69, 71, 130, 134, 135, 164 and 166.  In all of these I declined to accept the evidence of Mr Hepker.
29.	Further, on the day the judgment was handed down I was asked to and did make an order for indemnity costs.  The transcript of that hearing includes the following:
“MR ULLSTEIN: But, as was the case before Mitting J, when the learned judge there said he was quite sure that Mr Hepker firmly believed what he had said, My Lord, your Lordship’s judgment comes down firmly against Mr Hepker, but there is no statement contained in that judgment that he has set out to mislead the court at the end of the day.
MR JUSTICE TUGENDHAT: No.
MR ULLSTEIN:  My Lord, so far as being obstructive in relation to documents is concerned, all that has largely been dealt with already in this case by interlocutory orders for disclosure and interlocutory orders where orders for costs were made on the standard basis.  My Lord, you have a lengthy affidavit from Miss Burnett before you that was responded to again at length in the further witness statement of Mr Hepker.  It played no part in the trial at all.   Mr Hepker was not cross examined for a single moment about the matters raised by Miss Burnett.  These are not matters in our respectful submission that you can or should take into account in relation to indemnity costs….
MR JUSTICE TUGENDHAT:  One thing that is a little out of the ordinary is that there has already been litigation in the declaration proceedings…. in which much of this ground, but by no means all of it, was covered and although Mitting J said what he did about Mr Hepker’s state of mind, one cannot on reading the judgment feel otherwise than that Mitting J did not think there was anything in the point that the July 2001 statement said that the conditions had been fulfilled.  So after that judgment was it really reasonable for Mr Hepker to go on claiming that that is what it said, as he did before me?  He kept on saying it did he not?
MR ULLSTEIN:  Yes.  My Lord, studiously and ambiguously –
MR JUSTICE TUGENDHAT: Well, to me that is putting it high in favour of Mr Hepker.  I do not see any ambiguity about it myself because it does not say the conditions were fulfilled in circumstances where there would have been every reason to say so if he could have done.
MR ULLSTEIN:  Well, My Lord, that was Mitting J’s finding, that it was ambiguous.  Your Lordship has taken a sterner view of it.
MR JUSTICE TUGENDHAT:  He was letting Mr Hepker down gently, was he not? ”
30.	After submissions from both sides, I made the ruling which includes the following:
“This does appear to me to be a claim which by the time it reached this court was speculative and weak, and which it was unreasonable for the claimant to pursue.  There are two particular features, although I have in mind the whole of the judgment I have just handed down.  One is that this claim started following the judgment of Mitting J.  In that judgment he made very clear that the July 2001 statement of Mr Lavender did not support the proposition that the conditions precedent required in the planning permission had been fulfilled.  Although Mitting J used the words “studiously ambiguous”, in my judgment that is putting the matter high in Mr Hepker’s favour.
Having heard far more evidence, and seen far more documents than Mitting J saw in the declaration proceedings, it seems to me that the emphasis placed by Mr Hepker on that document in supporting his version of events was unreasonable.  It is well known now that where there is a conflict of oral evidence between witnesses in a case where there is contemporaneous documentation, the court will look very closely at the contemporaneous documentation with a view to making its findings as to what probably occurred.  There was nothing in the contemporaneous documentation, as I have found, which has provided material support for the claimant’s case.  
The second area in respect of which the unreasonableness of the claimant’s approach is to be emphasised is in relation to the quantum of the claim.  This claim was advanced as one for £16 million and remained at that figure right up to the beginning of the trial. Because the experts agreed at that point (or shortly after) upon a figure of a little over £1 million as the starting point, I never had to investigate how the figure of £16 million emerged. But the normal principle is that costs incurred should be proportionate to the sum at issue.  It seems to me that there must be force in the submission for the defendant that the costs and effort invested in this claim might well have been very different if it had been advanced from the outset on the basis of the figures which were ultimately agreed.  I have had no reason to take the view that £16 million was anything other than a speculative figure.  
So for those reasons and for the reasons which I hope I have set out sufficiently in the judgment itself, and bearing in mind the authorities which I have had cited to me but which I have not set out, the case is one in which I think it right to make an order for indemnity costs”.
SUBMISSIONS 
31.	Mr Evans-Tovey submits that it can be said that Mr Hepker funded the litigation in a wide sense.  There is no evidence that Mr Hepker personally funded any part of the litigation.  But Mr Evans-Tovey submits that Mr Hepker arranged the funding from La Sande and Terrace Hill by entering into the agreements with them which are referred to in the judgment and in this judgment.  
32.	In addition Mr Evans-Tovey refers to the agreement with Mr Elkins referred to in paragraph 162 of the judgment which was arranged and entered into on behalf of the claimant with Mr Hepker.
33.	He further submits:
“The litigation was for Mr Hepker’s own purpose or benefit in at least a personal sense because if it had been successful it would have benefited his children financially and because it would have probably enhanced his business or personal reputation”.
34.	In response to this submission Mr Hepker states that he was only acting for the benefit of his children and that he is hoping to retire very soon from the only activity which he carries on at the moment, namely representing the claimant in this litigation and related matters.
35.	Mr Evans-Tovey submits that Mr Hepker was the claimant’s “alter ego and the real party, exercising complete control over the litigation although not a director”.  He refers to the fact that Mr Hepker was company secretary of the claimant and to the passage in the judgment at para 79 where I found that “Mr Hepker was the only person through whom the claimant acted”.  He refers to two documents, one dated 10th September 2001 and the other dated 18th March 2004, in which Mr Hepker incorrectly describes himself as Chairman of the claimant.  The statement dated 18th March 2004 is a witness statement in the Declaration Proceedings.  It includes at para 13.3 the following:
“At all material times I was and still am the person principally responsible for formulating and implementing the policy of the company with regard to the land together with colleagues professional advisors and others.  I was the person for example who was principally responsible for giving instructions to the Company’s architects and planning consultants, called John Lavender Associates”.
36.	Reference is also made to a statement dated 10th February 2006 in relation to disclosure of documents in which Mr Hepker states “ I should add that I am the only executive officer of the company and there is no other officer of the company who has dealt with this litigation or the matters leading up to it”.
37.	It is submitted that the whole of the claim against the defendants depended upon the evidence of Mr Hepker as to what he said he had been told by Mr Lavender and as to what he said he had told to Mr Lavender.  On these matters I preferred the evidence of Mr Lavender.
38.	Further reliance is placed on what are said to be instances of obstructive and improper conduct in relation to the disclosure of documents and contacts with witnesses.  As to the conduct relating to witnesses, what is referred to is what I have said in the judgment concerning the agreement with Mr Elkins referred to at para 162 of the judgment and the contact with Mr Tweedale  referred to in paragraph 172 of the judgment.  As submitted by Mr Ullstein in his submissions in relation to costs, the disputes as to disclosure were not investigated at the trial, and have not been investigated in the present summary proceedings.  I am unable to make any findings as to the propriety or otherwise of Mr Hepker’s conduct in relation to disclosure of documents.  
39.	Mr Hepker submits that he was not “the real party to the action” in the sense referred to in the case law.  He did not fund the proceedings personally, or stand to benefit from them, whether financially or in any other relevant way. While he was seeking a benefit for his children, that is not to be assimilated to a financial benefit for himself.  The claimant company was not a nominal claimant in any sense. He submits that there are a number of reasons to support this contention.  First the land the subject of the dispute was acquired by the claimant in 1985 and had always been the property of the claimant       and never his own.  The company was initially one of substance, as appears from the accounts of the early years to which I have referred.  This was not a case in which it has been, or could be, suggested that he could have been joined as a party.  The company had a board of directors with a fluctuating membership of individuals all of whom were independent of himself.  Those who ultimately stood to gain if the litigation was successful, namely his three daughters, also stood to loose if the action failed, as it has. On any view the land was of substantial value and was the only asset from which the costs of the litigation would be recovered if the action failed.
40.	As to his own good faith and the propriety of bringing proceedings, Mr Hepker is unrepentant. Respectfully he tells me that he does not accept my findings.  He states that he did not in fact have sole control of the litigation, and that a number of decisions were made as to the conduct of the proceedings with which he disagreed.  These are matters which are obviously covered by privilege, and could not be investigated. I understood him to mean that the decisions in question were made by those who were funding the litigation, in particular La Sande and Terrace Hill.  He notes that the proceedings could not have been carried on in the manner which they were unless others apart from himself had considered that the claim had a good prospect of success.  He identifies individuals in La Sande and Terrace Hill, their professional advisers, members of the board of the claimant, and legal advisers whom he said advised that the claim did have a reasonable prospect of success.  The force of this point, however is very limited, because all those who considered the merits of the claim other than Mr Hepker could only have done so on the basis of the statements that Mr Hepker himself  made as to what had passed between himself and Mr Lavender.
CONCLUSION
41.	I made findings of fact as to Mr Hepkers state of mind in the judgment and in the ruling on costs on 17th December 2007.  What I said, in particular in relation to the speculative nature of the action, and the unreasonable continuance of it, is one factor weighing in favour of the defendants’ present application under s.51.
42.	The fact that the defendants considered applying for security for costs and did not do so is not a material consideration in the present case. The claimant had a valuable asset, the value of that asset was in dispute, and the decision not to apply for security for costs should not weigh against the defendants.
43.	While there is no doubt that Mr Hepker was the person principally involved in the management of the action, often assuming a role which would normally be played by a solicitor, I have not found any impropriety on his part in relation to that aspect of the matter which seems to me materially to advance the defendants case in the present application.
44.	I do not find that Mr Hepker is “the real party” to the claim against the defendants.  As I have already indicated, there is no basis for challenging the evidence put before me by Mr Hepker as to the control the board exercised over the litigation.  I have received no evidence from the three daughters of Mr Hepker whose financial interests are the ones truly at stake on the claimant’s side in all this litigation.  But the brief information that I have been given about them, which is not questioned, and the fact that one of the daughters did play a part at one stage of the litigation, supports the conclusion which I reach, namely that the board probably did apply their minds independently to the matters which had to be decided in this litigation.  The real party to the litigation was the claimant       company itself.  The claimant risked its own assets and made arrangements for funding the litigation which did not materially depend upon the financial contribution of Mr Hepker.
45.	The real complaint against Mr Hepker is that the action could not have been brought but for the account which he gave of his communications with Mr Lavender and which I have held to be incorrect.  This is essentially a complaint against him in his capacity as prospective witness, and then actual witness.  There may be cases in which the public interest in witness immunity should give way to the public interest in successful litigants obtaining reimbursement of the costs that they have incurred, and to which they are entitled, pursuant to an order for indemnity costs.  I say nothing about that, one way or another.  But on the facts of this case, and having regard to all submissions put before me, I am not persuaded that this is such a case. 
46.	In my judgment in all the circumstances it would not be just to exercise the power under Section 51 in favour of making an order for costs against Mr Hepker.  Accordingly the application fails.