The High Court’s decision in Mirza v Lewin [2026] EWHC 1423 (Ch) addresses the circumstances in which enforcement of a costs order will be stayed pending appeal, particularly where no appeal of the underlying substantive decision is on foot.
Background
The underlying dispute arose from proceedings in the Business and Property Courts concerning a Part 20 Claim brought by Mr Camran Mirza against three directors: Mr Mark Lewin, Mr Oliver Webster, and Ms Dawn Yates. The broader litigation also involved a Main Action brought by Mr Morjaria, in which Mr Mirza and others were defendants. By a substantive judgment handed down on 28 July 2025, Mr Justice Thompsell found against Mr Mirza in the Main Action, dismissed the counterclaim brought against Mr Morjaria, dismissed claims against Mr Mirza’s wife and son, and dismissed the Part 20 Claim against the Directors.
Following the substantive judgment, on 11 August 2025 the court made an order determining costs in favour of the Directors and including an interim costs order of £1.3 million. That sum remained unpaid at the time of the hearing.
On 20 August 2025, Mr Mirza applied to the Court of Appeal for permission to appeal the August Order and for a stay of execution pending appeal, arguing a breach of the indemnity principle and contending that his liability to pay the Directors’ costs was linked to the position of the parties in the Main Action. He did not, however, seek permission to appeal the dismissal of the Part 20 Claim itself. On 18 November 2025, Newey LJ refused permission to appeal the August Order.
On the same date, Newey LJ granted permission to appeal in the Main Action on ten grounds (in addition to two already granted by the trial judge), and granted the claimants in the Main Action permission on four grounds. Those appeals were listed to be heard together over five days at the end of October 2026. One of the grounds on which permission was granted concerned an allegation that the trial had been procedurally unfair, a point upon which Mr Mirza sought to place considerable reliance in the applications before Thompsell J.
On 21 January 2026, Master Brightwell made an order on the Directors’ ex parte application under Part 71, requiring Mr Mirza to attend court for questioning as to his financial means. By the time of the hearing before Thompsell J on 19 May 2026, four applications remained live: two stay applications brought by Mr Mirza seeking to halt enforcement of the Interim Costs Order; a set-aside application by Mr Mirza seeking to set aside or vary the Examination Order; and two charging order applications brought by the Directors over certain land and securities held by Mr Mirza.
Costs Issues Before the Court
The central costs-related issues before the court arose from the Directors’ attempts to enforce the unpaid Interim Costs Order of £1.3 million, made following the dismissal of the Part 20 Claim. The court was required to determine whether enforcement of that order should be stayed, and if so on what basis and for how long.
The first stay application concerned a writ of control and warrant issued by the Directors in respect of the Interim Costs Order. The second stay application, dated 11 May 2026, sought a more general stay of all enforcement steps taken pursuant to the August Order. Both applications were brought under s.49(2) of the Senior Courts Act 1981, CPR 3.1(2)(g), CPR 40.8A, and CPR 83.7, which permits the court to stay execution where there are special circumstances rendering enforcement inexpedient, or where the applicant is unable to pay.
A further enforcement-related issue arose from the Directors’ applications for interim charging orders over Mr Mirza’s interests in land and securities, made on 10 April 2026 under CPR 73.6(3) and s.1(1) of the Charging Orders Act 1979. Master Brightwell had directed that these applications be heard on notice, given the complexity of the proceedings. The applications before the court included the question of whether to proceed to make final charging orders.
The set-aside application, whilst not a costs enforcement matter in the strict sense, was closely connected: Mr Mirza sought to set aside or vary the Examination Order made under Part 71, which had been obtained by the Directors as a step towards understanding his financial position for enforcement purposes.
Underpinning all of these applications was the question of whether the pending Court of Appeal proceedings in the Main Action, and in particular the procedural unfairness ground, had any bearing on the enforceability of the Interim Costs Order made in the Part 20 Claim, in circumstances where no appeal of the Part 20 Claim was itself on foot.
The Judge’s Recusal Concern
At the commencement of the hearing, Thompsell J raised a concern about whether he should hear the stay applications at all. It appeared that a substantial part of Mr Mirza’s argument in favour of the stay applications was based on the prospect that he would succeed in the Court of Appeal in showing that the trial had been procedurally unfair, and that such a finding would impugn, and perhaps render void, the finding in the Substantive Judgment as it related to the Part 20 Claim also. The judge’s concern was that if, in determining the stay applications, he had to take into account the likelihood of this happening, he would be, as he put it, “marking my own homework”. He might be perceived to have been biased in relation to this point, given that he was having to determine the likelihood of his own conduct of a trial being ruled procedurally unfair.
The judge noted, however, that if he was considering a stay as being analogous to a stay requested under CPR 52.16, the matter would be determined on the basis of balance of injustice, and the likelihood of success on appeal would operate only as a tie-breaker and so would not necessarily be central to the argument. The matter was resolved when Mr Lloyd, representing the Directors, made the concession that, to the extent that the decision in the stay action was dependent on having to assess the prospects for success of the procedural unfairness issue, the judge could do so without having to determine that matter, but instead making an assumption that this argument had a good prospect of success before the Court of Appeal. Mr Lloyd made it clear that this assumption was relevant to this hearing only. On the basis of that concession, the judge considered that he could proceed with the hearing as he was relieved of any need to determine the narrow point where there might be a perception that he could not be impartial.
The Parties’ Positions
Mr Mirza’s position on the stay applications
Mr Mirza, represented by Hefin Rees KC, Jack Fletcher, and Michael Campbell of Noble Solicitors, advanced three principal arguments in support of the stay applications.
First, it was argued that the court had already stayed costs enforcement in the Main Action pending the outcome of the appeals, and that it would be unfair not to extend the same treatment to the Interim Costs Order in the Part 20 Claim. This argument was advanced on the basis that Mr Morjaria had funded a substantial portion of the Directors’ costs (at least £1,160,015 by his own evidence at trial, with an indication that he would pay all of their legal costs), and that he would therefore be the ultimate beneficiary of any payment under the Interim Costs Order. Mr Mirza characterised the Directors as “litigation conduits” for Mr Morjaria, pointing to a Deed of Co-Operation and Mr Morjaria’s payment of the Directors for their time in court. It was argued that the Directors’ costs should only be payable alongside Mr Morjaria’s costs and those of Mrs Mirza and Ameer Mirza.
Second, Mr Mirza argued that enforcement at this stage would cause him and his family substantial commercial disadvantage. His principal asset was an indirect interest in a development at Walpole Court, which was subject to a Murabaha facility with Al Rayan Bank. The Facility was structured so that, on early termination, the entire outstanding balance together with Al Rayan’s expected profit until 31 September 2029 would become payable. It was further argued that the development could not be sold with vacant possession because many of the flats were occupied under sub-licences, the longest of which did not expire until January 2027, and that the most advantageous sale would be as a single portfolio with vacant possession. It was also submitted that any sale using the proceeds to pay the Interim Costs Order would breach the Asset Preservation Undertakings Mr Mirza had given in lieu of a freezing order.
Third, Mr Mirza relied on the procedural unfairness ground of appeal in the Main Action. He referred to Serafin v Malkiewicz [2020] UKSC 23, in which Lord Wilson quoted Lord Reed PSC to the effect that “a judgment which results from an unfair trial is written in water”, and to Moss v Martin [2022] EWHC 3258 (Comm) for the proposition that a stay may be appropriate not only where there is a live appeal within the English courts, but also where something else “has the potential to undermine the foundation of” the order in question. Mr Mirza argued that if the Court of Appeal were to overturn the entirety of the substantive judgment on procedural unfairness grounds, this would necessarily undermine the August Order and the Interim Costs Order.
Mr Mirza’s position on the set-aside application
In relation to the Examination Order, Mr Mirza argued that the Directors had failed to discharge their continuing duty of full and frank disclosure on the ex parte application, specifically by failing to mention in a letter to the court dated 9 February 2026 the financial disclosure already made in his 14th witness statement, and by implying that the appeals had no impact on the Part 20 Claim. He further argued that requiring him to attend an examination would be otiose and oppressive given the volume of financial disclosure already provided, the Asset Preservation Undertakings he had given, and the pending appeal on procedural unfairness grounds.
The Directors’ position
The Directors, represented by Christopher Lloyd of PCB Byrne LLP, resisted the stay applications on multiple grounds. They argued that Mr Morjaria’s funding of their costs did not amount to “special circumstances” justifying a stay, noting that this point had already been raised and dismissed when Mr Mirza sought an adjournment of the hearing on the Interim Costs Order, and that the argument framed as a breach of the indemnity principle had been refused permission to appeal. They produced evidence that, contrary to Mr Morjaria’s general statements at trial, £1.6 million of the Directors’ legal costs had been paid by their employer, IQEQ, out of some £2.7 million of legal costs incurred.
On the financial hardship argument, the Directors contended that Mr Mirza’s valuation of Walpole Court appeared substantially less than the valuation on which the Facility was granted; that the Facility appeared to allow individual units and parking spaces to be sold at current market value; and that Mr Mirza could obtain loans from other members of his family or their companies, noting that his wife was already lending him £25,000 per month for living expenses and had allowed loans to fund his appeal.
In relation to the Examination Order, the Directors relied on Vale v BSG [2020] EWHC 2021 for the proposition that in an application under Part 71 a judgment creditor is not under an obligation to disclose what documents he already has in his possession relating to enforcement, and that the fact the debtor has provided some information already is not a material matter caught by the full and frank disclosure obligation. They also relied on Sucden Financial v Fluxo-Cane [2009] EWHC 3555 (QB) for the proposition that an examination order may be made even where the relevant order has been stayed, as an examination order is not part and parcel of the process of enforcement, but is there to enable a judgment creditor to enforce a judgment order.
The Court’s Analysis
The argument based on Mr Morjaria’s involvement
The court rejected the argument that the Directors’ costs should be stayed because Mr Morjaria had funded them. Thompsell J noted that this argument had even less merit than when he had considered and rejected it before, since it was now clear that the £1.3 million interim payment would not go back to Mr Morjaria. The evidence showed that £1.6 million of the Directors’ legal costs had been paid by their employer, IQEQ. The court concluded that Mr Mirza had brought unmeritorious claims against the Directors, and they (or their employer) should not have to wait to receive payment of that money back.
The argument based on Mr Mirza’s financial position
The court accepted that, in order to realise cash to meet the Interim Costs Order, it was likely that Mr Mirza (or another member of his family) would have to sell assets, and that this might be substantially commercially disadvantageous. However, the court found that Mr Mirza’s financial position was not likely to get materially better in the medium term.
Thompsell J identified two circumstances in which the courts have stayed enforcement proceedings on the grounds that meeting a payment order would cause substantial commercial disadvantage to the paying party: first, where there is a prospect of a successful appeal; and second, where the paying party is able to point to specific assets which it is selling (or re-financing) so as to raise the money to pay, and the circumstances warrant a stay until particular steps are taken to allow those assets to be sold at a proper value. However, as Foxton J (as he then was) said in Recovery Partners v Rukhadze [2023] WLUK 369, what is of obvious relevance to the court is whether there is sufficient realistic prospect of the position changing during the period of the stay, and how confident the court can be of the stay producing the promised beneficial outcome, rather than simply kicking the can down the road to no great purpose.
The court found that Mr Mirza’s circumstances were not likely to change substantially if he was given a stay until the Court of Appeal had published its decision. The argument regarding the terms of the Facility remained valid up to 31 December 2029, and any reduction in the liability for terminating that Facility would be offset by interest payable for late payment of the Interim Costs Order. The point regarding the length of the tenancies was highly suspect: under the Renters’ Rights Act 2026 most fixed term tenancies are converted into periodic tenancies that can only be terminated by the landlord in particular circumstances, and vacant possession can only be obtained with a court order, which may take many months to obtain. The court also noted that even if some of the flats were vacated earlier, they might need to be relet in order to find the income to keep paying down the Facility.
The court also noted that even if Mr Mirza succeeded in the Court of Appeal in relation to the Main Action, it was not clear that this would be transformative of his financial position, certainly in the medium term. It was unlikely that he would get an immediate costs order at the end of a five-day appeal hearing, and if the ground on which he succeeded related to procedural unfairness rather than the substantive merits, there was a strong possibility that the Court of Appeal would defer any costs order until there had been a retrial. Further, even if Mr Mirza obtained costs or other orders against Mr Morjaria, his financial position would not be improved unless and until those orders were enforced, and Mr Mirza had himself made the case that it was extremely difficult to get enforcement against Mr Morjaria in Dubai.
Applying a test of balance of inconvenience, and ignoring for the moment the possibility of the Court of Appeal declaring that the substantive judgment was void in relation to the Part 20 Claim, the court concluded that the prospect of Mr Mirza being in a better position to pay at the point that the Court of Appeal made its judgment was too uncertain to provide grounds for a stay, especially as it was balanced by the prospect that he might lose and so find it even more difficult to satisfy his creditors.
The argument based on the Court of Appeal finding procedural unfairness
The court noted that CPR 52.16 makes particular provision for stays where there is an appeal. The essential question is whether there is a risk of injustice to one or other or both parties if the court grants or refuses a stay: Hammond Suddard Solicitors v Agrichem International Holdings Ltd [2001] EWCA Civ 2065. The normal rule is for no stay to be granted, but where the justice of that approach is in doubt, the answer may depend on the perceived strength of the appeal: Otkritie International Investment Management Ltd v Urumov [2014] EWHC 755 (Comm).
Thompsell J considered that if Mr Mirza had obtained permission to appeal the substantive judgment in relation to the Part 20 Claim, and the court was considering a stay application under CPR 52.16, the disadvantages Mr Mirza potentially faced through having to sell assets to meet the Interim Costs Order did create a risk of injustice that would crystallise if he won his appeal, after selling assets on disadvantageous terms or in disadvantageous circumstances.
However, there was no appeal on foot in relation to the Part 20 Claim and no certainty that the Court of Appeal would grant permission for such an appeal given that this was being raised very late. Mr Mirza relied on Moss v Martin [2022] EWHC 3258 (Comm) for the proposition that the stay approach does not only apply where there is an appeal on foot within the English courts, but also in circumstances where something else “has the potential to undermine the foundation of” the order in question. He argued that there was a prospect that the Court of Appeal would overturn the entirety of the substantive judgment on the grounds of procedural unfairness, citing Serafin v Malkiewicz [2020] UKSC 23, where Lord Wilson quoted Lord Reed PSC as saying that “a judgment which results from an unfair trial is written in water”.
Whilst the court could see the logic in this argument, it concluded that the Court of Appeal would not overturn the decision in the Part 20 Claim without giving the Directors an opportunity to put forward their own arguments as to whether the trial had been procedurally unfair. If Mr Mirza wished to overturn the decision in the Part 20 Claim, he could only do so by joining the Directors into the appeal. He would face a difficulty in doing so since it was now extremely late to seek to bring an appeal. Nevertheless, the court could not discount the possibility that Mr Mirza would obtain late permission to appeal on the grounds of procedural fairness, particularly as (for the reasons explained at the beginning of the judgment) the court was operating on the assumption that such an appeal, if allowed, would have a good prospect of success.
The court concluded that if an appeal of the Part 20 Claim were on foot, it would grant a stay pending the determination of that appeal. If there was no prospect of appeal, it would not grant a stay. The issues concerning procedural fairness raised the possibility of an appeal, but that possibility did not crystallise until permission was given for an appeal on those grounds. In these circumstances, the only fair approach would be to give Mr Mirza a short opportunity to apply to the Court of Appeal for permission to appeal the Part 20 Claim on the grounds of procedural unfairness.
The Set-Aside Application
The court rejected Mr Mirza’s arguments that the Directors had failed to discharge their continuing duty of full and frank disclosure. Relying on Vale v BSG [2020] EWHC 2021, the court noted that in an application under Part 71 a judgment creditor is not under an obligation to disclose what documents he already has in his possession relating to enforcement, and the fact the debtor has provided some information already is not a material matter caught by the full and frank disclosure obligation. As to the failure to update the court about Mr Mirza having had permission to appeal the substantive judgment in relation to unfair proceedings, the court did not see this as a breach of requirements for full and frank disclosure, noting that there was no appeal on foot as regards the Part 20 Claim.
The court also rejected the argument that nothing would be achieved from the examination given the financial information Mr Mirza had already provided. The information that Mr Mirza had provided was by no means complete, and the cash flow and balance sheet disclosures made were incomplete and less than useful. Further, findings were made within the substantive judgment that Mr Mirza was not always honest in his presentation of information. The court concluded that this was clearly a case where a very full examination before a judge was necessary, and on that basis ordering it could not be oppressive.
In relation to the Asset Preservation Undertakings, the court expressly stated that these had no bearing on the need for the Directors to understand what assets were available that they might enforce against.
The court noted that the Directors relied on Sucden Financial v Fluxo-Cane [2009] EWHC 3555 (QB) for the proposition that an examination order may be made even where the relevant order has been stayed, as an examination order is not part and parcel of the process of enforcement, but is there to enable a judgment creditor to enforce a judgment order. Whilst the court saw no reason to strike out or vary the Examination Order, it considered it would be appropriate to stay its implementation as part of the more general stay that it was ordering, to ensure that the information received was the most up-to-date available.
The Charging Order Applications
The court noted that it has a discretion whether to make charging orders under CPR 73.6(3) (interim orders) and CPR 73.10A(3) (final orders) and s.1(1) of the Charging Orders Act 1979. In exercising its discretion the court must consider all the circumstances of the case, including the personal circumstances of the debtor and whether any other creditor would be likely to be unduly prejudiced by the making of the order.
The court noted that the fact that the debtor’s position is that the judgment debt renders him balance sheet insolvent is not a reason to refuse to make the charging orders final unless UK insolvency proceedings are already on foot or are imminent: Roberts Petroleum v Bernard Kenny [1982] 1 WLR 301. The fact that the judgment creditor has the benefit of a freezing order is not a weighty consideration in deciding whether to make a final charging order: State Bank of India v Mallya [2019] EWHC 995 (QB). Where there are competing judgment creditors, the court may adopt a “first past the post” approach if that is the just and equitable outcome between them. In British Arab Commercial Bank v Algosaibi [2011] 2 CLC 736, Flaux J (as he then was) treated “first past the post” as the “general rule” in non-statutory insolvency regime cases, giving rise to only a “limited discretion to decline to make the charging order final”.
Given the difficulties that the Directors had had in enforcing the Interim Costs Order, that there were no insolvency proceedings in the offing in relation to Mr Mirza, and that it was his evidence that he was not insolvent on a balance sheet basis, the court considered that the case for a charging order was a strong one. However, the court noted that Mr Mirza had had only four working days’ notice of the charging order applications, and that the time estimate for the hearing had been fixed without any allowance of time to consider them. As it turned out, there was no time within the hearing for any oral submissions on the charging order applications.
The court also noted that granting the applications would cause significant prejudice to Mr Mirza as it would constitute an Event of Default under the Facility, and would prejudice innocent third parties including the other shareholders in Prime Ealing and other creditors. The court observed that had the short notice been the only reason for a stay, it would have granted the charging orders but stayed their enforcement. However, it was the additional factors (the Event of Default risk and the prejudice to third parties) that warranted a fuller hearing.
Having regard to these points, the context that the Asset Preservation Undertakings provided some form of protection for the Directors, and that the court was already ordering a general stay until the Court of Appeal determined whether it would give late permission to appeal the decision in the Part 20 Claim, the court concluded that the balance of justice was best served by adjourning and staying the charging order applications as part of that general stay. This reflected, in particular, the point that the potential for an Event of Default deserved a better airing before the court than had been possible in the circumstances.
Conclusion
The court refused the two stay applications made by Mr Mirza, which sought a stay until the Court of Appeal had determined the appeal in the Main Proceedings. However, it ordered a much shorter general stay until the Court of Appeal determined an application for late permission to appeal the decision in the Part 20 Claim (assuming that such an application was made within a week from the date on which the judgment was handed down). The practical effect was that enforcement was stayed, albeit on a much shorter and more conditional basis than Mr Mirza sought.
The court refused Mr Mirza’s application to set aside or vary the Examination Order, but stayed its implementation as part of the more general stay. The court adjourned and stayed the charging order applications as part of that general stay.
The court did not deal with costs at the hearing. It proposed to deal with the costs relating to the matters dealt with in the judgment on paper, following written submissions and costs schedules from the parties.
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