MCA Records Inc v Charly Records Ltd & Ors

Factual and Procedural Background

The proceedings commenced in February 1994 with Company A as the sole defendant, accused of copyright infringement relating to certain sound recordings known as "the Chess recordings." Company A went into receivership in April 1996, and the Appellant was joined as a defendant shortly thereafter, alleged to be a joint tortfeasor who personally authorised and directed the infringing acts.

At trial, the Appellant was the only effective defendant and was found jointly liable with Company A for copyright infringement. The trial judge ordered the Appellant to pay damages and costs on an indemnity basis, including an immediate payment on account of costs of £350,000 within 56 days. The judge refused permission to appeal.

The Appellant sought extensions and stays of the payment order, supported by evidence claiming inability to pay. The trial judge expressed scepticism about the Appellant's financial assertions but granted a short extension to facilitate an appeal application.

The Appellant was granted permission to appeal by a single judge of this Court, who also stayed the payment obligation pending the appeal. The appeal was heard, and on 5th October 2001, this Court ordered the Appellant to pay £350,000 within 56 days and refused further permission to appeal to the House of Lords.

The present application concerns a request for an extension of time to comply with that payment order, citing a pending petition for leave to appeal to the House of Lords as a change in circumstances.

Legal Issues Presented

1. Whether the Court should grant an extension of time to comply with the payment order of £350,000 made on 5th October 2001.
2. Whether the existence of a pending petition for leave to appeal to the House of Lords constitutes a sufficient change in circumstances to justify such an extension.
3. The appropriate approach to stays of execution pending appeal applications to the House of Lords.

Arguments of the Parties

Appellant's Arguments

• The Appellant contends that the Court should not assume he is not credible when he asserts inability to pay the ordered sum.
• The pending petition for leave to appeal to the House of Lords is analogous to the prior situation where a stay was granted pending appeal, justifying an extension to avoid injustice.
• The enforcement of the costs order before the House of Lords decides on leave could stifle an arguable appeal.

Respondent's Arguments

• This information was not available in the provided opinion.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court carefully distinguished between the role of this Court when hearing appeals and the position when a petition for leave to appeal to the House of Lords is pending. It explained that while this Court can grant stays pending appeals before it, applications for stays pending leave to appeal to the House of Lords must be made to this Court, as it is not open to appellants to seek stays directly from the House of Lords.

The Court accepted that the Appellant’s petition for leave to appeal constituted a potentially arguable appeal but found that refusal of an extension would not cause serious injustice. This was because the petition had already been lodged, so refusal to extend time would not impede the leave application process.

Moreover, the Court reasoned that even if leave were granted, the Appellant’s lack of significant assets meant that enforcement of the costs order would not prevent him from funding the appeal, as any income intended to fund the appeal was subject to Mareva injunctions and would require further court permission to use.

The Court also considered the possibility of bankruptcy proceedings but concluded that such proceedings were unlikely given the Appellant’s non-resident status and the pending appeal, which would be relevant to any bankruptcy application.

On balance, the Court found no basis to extend the time for payment.

Holding and Implications

The Court DISMISSED the application for an extension of time to comply with the payment order of £350,000.

The direct effect is that the Appellant must comply with the payment order within the original time frame. The Court’s decision does not establish new precedent but clarifies the procedural approach to stays pending applications for leave to appeal to the House of Lords and confirms the limited circumstances in which extensions are granted. The ruling preserves the enforceability of costs orders pending higher appellate consideration, subject to appropriate court oversight of any funding issues arising from Mareva injunctions or bankruptcy proceedings.