NASSAU, BAHAMAS-The Supreme Court has upheld a $26,490 costs award in a dispute involving Lucayan Towers South Condominium Association and Lawrence Investments Limited against Grand Bahama Utility Company Limited, following successful contempt proceedings tied to a breach of court orders.
Justice Loren Klein found that the claimants Lucayan Towers South Condominium and Lawrence Investments Limited were entitled to recover their legal costs after successfully enforcing a prior injunction against the utility company. The Court also affirmed that the costs claimed were reasonable and proportionate, and rejected attempts by the defendant to reduce or offset the amount through a proposed set-off against alleged outstanding debts.
The decision concludes the summary assessment phase of proceedings that stemmed from earlier findings that Grand Bahama Utility Company Limited had breached an injunction issued by the Court. That breach resulted in the imposition of a $6,000 fine and an order that the company pay the claimants’ legal costs, which were to be assessed based on written submissions and supporting documentation.
The underlying dispute relates to enforcement proceedings arising from a 1988 condominium declaration governing Lucayan Towers South Condominium Association in Freeport, Grand Bahama. The matter also engages provisions of the Hawksbill Creek Agreement and associated legislation regulating the Freeport industrial and harbour area, along with local building and sanitary codes.
At the centre of the case was a notice of intention to revoke an occupancy certificate, which triggered legal action by the claimants. The dispute escalated into contempt proceedings after allegations that the defendant failed to comply with earlier court orders, including an injunction intended to regulate its conduct in relation to utility services affecting the condominium complex.
Following hearings in 2025, the Court found that the defendant had breached the injunction. Justice Klein imposed a fine and awarded costs to the claimants, directing that those costs be summarily assessed after the filing of written submissions and a formal bill of costs.
The claimants submitted a bill of costs totalling $26,490, including $25,500 in professional fees and $990 in disbursements. The bill reflected 29 hours of pre-hearing preparation, correspondence and drafting, eight hours of court attendance, and an additional 5.5 hours of post-judgment work, including preparation of the bill of costs.
They argued that the matter was procedurally complex and of significant importance, involving disruption of essential services to a multi-occupancy residential building with broader implications for health and safety. They further pointed to efforts made to resolve the dispute outside of court, as well as novel procedural questions surrounding contempt and committal applications under the Civil Procedure Rules.
The defendant objected on several grounds. It argued that portions of the bill were outside the scope of the Court’s costs order, that certain entries did not relate directly to the originating application, and that some of the time recorded was excessive. It also submitted that any costs awarded should be set off against more than $500,000 allegedly owed by the claimants in water arrears, including a previously awarded judgment sum of approximately $427,878.49 arising from an earlier quantum meruit decision.
In response, the Court reaffirmed the legal principles governing costs under the Civil Procedure Rules, noting that the Court has full discretion to determine the incidence, amount and timing of costs awards. Justice Klein reiterated that the general rule remains that costs follow the event, meaning the unsuccessful party is ordinarily required to pay the successful party’s costs, subject to the Court’s overriding discretion.
He further emphasized that only costs which are reasonably and proportionately incurred, and reasonable in amount, may be allowed. In making such determinations, the Court must consider factors such as the complexity of the case, the conduct of the parties, the importance of the issues involved, the efforts made to resolve the dispute, and the time and skill required in the litigation.
The Court also noted that summary assessment is the preferred method for determining costs following applications, allowing for efficient resolution without the need for detailed taxation unless circumstances require it.
Justice Klein rejected the defendant’s argument that portions of the bill fell outside the scope of the costs order. He found that the originating application and earlier notice of application formed part of the same procedural continuum and could not be artificially separated for the purposes of costs assessment.
The Court described the defendant’s position as unrealistic and unmeritorious, noting that the filing of an originating application was largely procedural and did not alter the substantive nature of the proceedings. The judge also observed that the same affidavit evidence supported both stages of the application and that the final procedural framing did not limit costs in the way suggested by the defendant.
The Court further dismissed arguments that certain time entries were excessive. While acknowledging that minor objections could be raised, Justice Klein found that none of them rose to the level of disproportionality or unreasonableness required to justify reduction. He accepted that the hourly rates charged were within an acceptable range for counsel of similar seniority and consistent with established judicial guidance.
In assessing the overall bill, the Court found that the case involved enforcement of prior court orders, efforts at pre-litigation resolution, and procedural complexity surrounding contempt proceedings. It also involved matters affecting essential services to a residential complex, elevating its importance to the parties involved.
Having considered all relevant factors, the Court concluded that the hours spent, rates charged, and disbursements incurred were reasonable and proportionate in the circumstances. The full amount of $26,490 was therefore approved.
A significant element of the ruling also concerned the defendant’s request for a set-off against alleged debts owed by the claimants. The Court noted that this argument was raised late in written submissions without full evidential support or detailed legal argument.
Justice Klein reiterated that while courts have discretion to order set-off in appropriate cases, such discretion must be exercised carefully and on a proper legal and evidential basis. He distinguished between routine costs-on-costs set-offs, which are commonly permitted under the Civil Procedure Rules, and attempts to set off costs against unrelated debts or damages, which require a closer legal and equitable connection.
The Court referred to established authority confirming that set-off is generally only appropriate where competing claims are so closely connected that it would be inequitable to enforce one without considering the other. In this case, the Court was not satisfied that such a threshold had been met.
The judge also noted the presence of multiple parties in the proceedings, which further complicated any proposed set-off arrangement. In the absence of proper submissions or supporting evidence, the Court declined to exercise its discretion to grant the relief sought.
Accordingly, Justice Klein ordered that Grand Bahama Utility Company Limited pay the claimants’ costs in the sum of $26,490 within 21 days, with statutory interest to apply thereafter in the event of non-payment.
