Reserved Costs for Withdrawn/Moot Interlocutory Injunctions Where Merits Will Be Revisited at Trial

Case: GDL Management Group Public Limited Company v Bert's Properties Ltd (Approved)
Citation: [2026] IEHC 436  |  Court: High Court of Ireland  |  Judge: O’Connell J  |  Date: 3 July 2026

1) Introduction

This decision concerns costs following an interlocutory application to restrain the advertisement of a winding-up petition. The defendant (a building contractor) served a statutory demand under section 570 of the Companies Act 2014 and then presented a winding-up petition. The plaintiff (a property company) asserted that the claimed debt was disputed on substantial grounds. It issued plenary proceedings and sought interlocutory relief to prevent advertisement/prosecution of the petition—particularly sensitive, it said, due to an imminent IPO.

Before the injunction motion was heard, the plaintiff paid the demanded sum (as corrected) “while maintaining” that the petition was an abuse of process, intending to pursue the substantive action to recover that sum (and more). The petition thereby became incapable of progression (the defendant was no longer a creditor), and the injunction motion became unnecessary. The sole issue addressed in this judgment is: who should bear the costs of the interlocutory motion?

2) Summary of the Judgment

O’Connell J held that, although the interlocutory injunction became moot because the plaintiff paid the debt (so, in substance, the motion was to be treated as a withdrawal by the plaintiff), it would be unjust to automatically impose costs on the plaintiff at that stage. Given the overlap between the injunction dispute and the issues to be determined at trial—together with the risk of injustice in making an immediate costs order—O’Connell J applied the logic of the “Dubcap approach” and ordered that the costs of the interlocutory motion be reserved to the trial judge.

3) Analysis

3.1 The court’s organising framework: “labelling” non-merits dispositions

A notable feature of the judgment is its structured taxonomy of how proceedings can end without a decision on the merits: withdrawal, concession, procedural strike-out, default award, mootness, and compromise. The purpose is practical: costs analysis depends heavily on identifying what, in substance, occurred.

Applying that taxonomy, O’Connell J treated the petition as superficially “moot”, but traced causation: the injunction motion became moot because the petition could not proceed; the petition could not proceed because the plaintiff paid; therefore “the case must ultimately be treated as one of withdrawal of the motion.”

3.2 Statutory and rules framework on interlocutory costs

  • Discretion: Order 99 rule 2(1) reflects the court’s broad discretion over costs, consistent with section 169(1) of the Legal Services Regulation Act 2015.
  • “Costs follow the event” presumption: Section 169(1) codifies the presumption that an entirely successful party is entitled to costs unless the court orders otherwise, having regard to the circumstances and conduct. Although aimed at “civil proceedings”, it informs interlocutory steps via section 168 and Order 99 rule 3(1), as explained in Pembroke Equity Partners v Corrigan [2022] IECA 142.
  • Requirement to make some costs decision on interlocutory applications: Order 99 rule 2(3) says the court “shall make an award of costs” on interlocutory applications save where it is not possible justly to adjudicate. The judgment also notes (relying on Meta Platform Ireland Ltd v Data Protection Commission [2026] IEHC 8) that making costs “costs in the cause” counts as an “award of costs” for this purpose.

The tension is obvious: a presumption favouring immediate costs outcomes versus the reality that many interlocutory applications—especially injunctions—are decided on incomplete evidence and may be revisited at trial.

3.3 The “Dubcap approach” to costs in merits-linked interlocutory injunctions

The judgment synthesises authorities recognising that costs on interlocutory injunctions should not always turn on who “won” the motion, because the trial may reveal a different merits picture. This is linked to:

  • Dubcap Ltd v Microchip Ltd (Unreported, Supreme Court, 9 December 1997)
  • AIB v Diamond (Unreported, High Court (Clarke J), 7 November 2011)
  • ACC Bank plc v Hanrahan [2014] 1 IR 1 (analogous principles in summary judgment)

The core idea (captured in the quoted passage from Clarke J in Diamond) is a distinction between:

  • cases where an interlocutory injunction turns on merits-bound factual assessments that might look different at trial (creating a “risk of injustice” if costs are fixed immediately); and
  • cases turning on matters not revisited at trial (e.g., adequacy of damages / balance of convenience), where costs can more readily follow the interlocutory “event”.

O’Connell J expressly treats the Dubcap approach as part of a toolkit, not an automatic rule, noting the “moral hazard” concern (litigants might run speculative motions if costs are routinely deferred), but emphasising that hopeless/oppressive applications can still be met with adverse costs consequences (illustrated by Ryanair v Aer Rianta (Unreported, Supreme Court, 26 October 2001)).

3.4 When the injunction motion is not determined: mootness, withdrawal, concession

The judgment’s key contribution is its detailed discussion of costs where the injunction motion does not get argued because it becomes moot, is withdrawn, or is conceded—yet the underlying action continues.

(a) Keogh: costs in the cause without resolving why the motion became moot

O’Connell J draws guidance from Keogh v AV Pound Co. Ltd [2021] IEHC 640, where an injunction motion became unnecessary due to changed circumstances, and there was a dispute about whether that change was effectively a “concession.” Allen J declined to speculate about the likely outcome of the unargued injunction motion and treated the substantive trial as the best forum to determine overall responsibility for costs, making costs “costs in the cause.”

(b) Tekenable: reserving costs where issues remain live for trial

In Tekenable Limited v Morrissey [2012] IEHC 391, Laffoy J reserved costs where the injunction motion did not proceed because undertakings were negotiated (without costs agreement), noting that the disputed issues remained for trial and it would be inappropriate to adjudicate on them (even implicitly) for costs purposes. While one element of Tekenable (that there was no “event”) has been weakened by later authority (as O’Connell J notes), its underlying rationale—avoid premature merits findings and leave costs to the judge who will see the full picture—remains influential.

(c) The counter-weight: immediate costs orders despite merits overlap

The judgment then confronts two decisions where courts made immediate costs orders even though the interlocutory injunction issues related to matters potentially revisited later:

  • Irish Bacon Slicers Limited v Weidemark Fleischwaren GmbH & Co [2014] IEHC 293: Peart J awarded costs against a defendant who gave the undertaking only on the morning of the hearing. Policy considerations featured prominently: discouraging tactical delay and ensuring immediate costs consequences where a party’s late step made the hearing unnecessary.
  • Rogerson v O'Dwyer [2025] IEHC 70: Cahill J ordered costs against a plaintiff who effectively abandoned the motion, and—importantly—accepted that the ultimate remedy was damages and not the kind of injunctive relief sought. That reduced the logic for leaving interlocutory costs to the trial judge.

O’Connell J treats these authorities as fact-sensitive applications of discretion rather than a rejection of the Dubcap approach. Both demonstrate that courts may properly look at the procedural context and (at a high level) the reasonableness of persisting to the door of court.

3.5 Legal reasoning in the present case

(a) Characterisation: withdrawal, but not determinative

The plaintiff’s payment rendered the petition and injunction motion moot. O’Connell J nevertheless treated this as a withdrawal in substance (because the plaintiff’s unilateral act caused mootness). That engaged the general proposition that withdrawal/concession is an “event” for costs purposes and would ordinarily pull towards costs against the withdrawing party.

(b) Why the court nevertheless reserved costs

O’Connell J identified two sharply divergent trial outcomes that would powerfully affect the justice of costs allocation:

  • If the plaintiff proves the defendant was owed nothing (or less than the statutory threshold), the debt would have been bona fide disputed on substantial grounds and the petition “wrongly presented.”
  • If the plaintiff’s case fails (or does not reduce the defendant’s debt below the statutory threshold), there would be a strong pull towards the view that the petition was properly presented.

This is quintessential Dubcap territory: the interlocutory dispute and the substantive merits are intertwined, and deciding interlocutory costs now risks penalising the party who may ultimately be vindicated.

The court also considered and rejected reasons to depart from that approach:

  • Not hopeless: Having reviewed the affidavits, O’Connell J was not prepared to say the injunction motion was hopeless such that the plaintiff should have anticipated failure from the outset (cf. the “without any foundation” theme in Ryanair v Aer Rianta).
  • Extraneous rationale for payment: The risks of publicity/non-anonymisation (including IPO sensitivity) were treated as an objective factor explaining why the plaintiff might pay to neutralise collateral harm, without conceding the merits.
  • Who brought the existential threat to court: Unlike scenarios where the party fixed with costs was the initiator of the court threat, the defendant here presented the winding-up petition, described as an “existential threat” to the plaintiff.

Balancing those matters, the court considered that the injustice of an immediate and potentially irreversible costs penalty outweighed the unfairness to the defendant of delayed costs vindication.

(c) Reserved costs, not “costs in the cause”

The court then chose between: (i) making the interlocutory costs “costs in the cause” (automatically tracking the ultimate winner), or (ii) reserving costs to the trial judge as a distinct decision.

O’Connell J preferred reservation because the ultimate result in the plenary action might not “map directly” onto the costs justice of the injunction motion (e.g., partial outcomes where the debt is reduced but not extinguished). This is an important practical point: “reserve” keeps the costs question open for a tailored trial-level assessment rather than mechanically following the overall “winner.”

3.6 Impact and significance

  • Clarifies that “withdrawal” is not the end of the analysis: Even where a motion is, in substance, withdrawn (because the moving party moots it), the court may still reserve costs where the underlying merits will be determined at trial and an immediate decision risks injustice.
  • Reduces perverse incentives: If withdrawal automatically triggered adverse costs in this category, litigants might be pushed to fight on (and incur more costs and court time) just to avail of Dubcap-style deferral. The judgment explicitly identifies this “moral hazard.”
  • Guidance for winding-up petition restraint applications: The reasoning is likely to be cited in future disputes where a company pays under protest to avert advertising damage, then sues to recover the payment. It signals that costs will be assessed in light of the eventual merits, not merely the tactical end of the interlocutory step.
  • Preserves discretion to sanction abuse: The decision does not immunise parties from adverse costs where a motion is hopeless, oppressive, or pursued for ulterior purposes; it frames Dubcap as discretionary and fact-dependent.

4) Complex Concepts Simplified

  • Statutory demand (Companies Act 2014, s.570): A formal demand for payment. If not satisfied, it can ground a winding-up petition. It is often used as leverage, but it should not be used where a debt is genuinely disputed on substantial grounds.
  • Winding-up petition & advertisement: A court process seeking to wind up a company. Advertisement/publication can cause severe reputational and commercial harm, which is why companies sometimes seek injunctions restraining advertisement pending dispute resolution.
  • Interlocutory injunction: Temporary relief granted before trial to preserve the position. It is not a final ruling on who is right; it is based on a limited evidential record.
  • Mootness: The court will not decide an issue if events have overtaken it so a decision would have no practical purpose.
  • “Costs follow the event”: The usual rule that the winner gets costs. But “event” can be nuanced: it can include withdrawal/concession, and it may be displaced where justice requires (especially in merits-linked interlocutory contexts).
  • “Costs in the cause” vs “reserved costs”: “Costs in the cause” means the costs automatically go to whoever ultimately wins the main action. “Reserved” means the trial judge decides later, potentially in a more tailored way that does not necessarily mirror the overall outcome.

5) Conclusion

GDL Management Group Public Limited Company v Bert's Properties Ltd [2026] IEHC 436 provides a structured and pragmatic approach to costs where an interlocutory injunction motion becomes moot because the moving party takes a step (here, payment under protest) that neutralises the immediate threat. Although that is treated as a form of withdrawal (normally an “event” attracting adverse costs), O’Connell J held that justice may require the court to apply the Dubcap logic and reserve costs to trial when the merits will be revisited and the interlocutory costs question cannot fairly be answered in isolation. The decision is likely to influence how parties and courts handle costs in petition-restraint and other merits-entangled interlocutory injunction contexts—especially where collateral commercial harm drives early de-escalation without conceding liability.