Alfaro v Brokesova - [2013] WASCA 38

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: ALFARO -v- BROKESOVA [2013] WASCA 38

CORAM: MURPHY JA

HEARD: 6 FEBRUARY 2013

DELIVERED : 22 FEBRUARY 2013

FILE NO/S: CACV 101 of 2012

BETWEEN: KALI ALFARO
Appellant
AND
SANDRA BROKESOVA
Respondent

ON APPEAL FROM:
Jurisdiction              :  DISTRICT COURT OF WESTERN AUSTRALIA
Coram  :WISBEY DCJ
Citation  :ALFARO -v- BROKESOVA [2012] WADC 122
File No  :CIV 3311 of 2010

Catchwords:

Practice and procedure - Application for security for costs - Appellant outside jurisdiction - Appellant has no assets within jurisdiction

Legislation:

Foreign Judgments Act 1991 (WA)
Foreign Judgments Regulations 1992 (WA)
Motor Vehicle (Third Party Insurance) Act 1943 (WA), s 27A
Supreme Court (Court of Appeal) Rules 2005 (WA), r 44(1)

Result:

Security in the sum of $12,000 to be provided

Category: B

Representation:

Counsel:

Appellant: G Stubbs
Respondent: B C Sierakowski

Solicitors:

Appellant: Dwyer Durack
Respondent: Brian C Sierakowski

Case(s) referred to in judgment(s):

Alfaro v Brokesova [2012] WADC 122
Brundza v Robbie & Co [No 2] [1952] HCA 49; (1952) 88 CLR 171
Dodds v Kennedy [2011] WASCA 32
Green (as liquidator of Arimco Mining Pty Ltd) v CGU Insurance Limited [2008] NSWCA 148
Mabrouk Minerals Pty Ltd v Mabrouk Holdings Ltd [2008] WASC 132
Technomin Australia Pty Ltd v Xstrata Nickel Australasian Operations Pty Ltd [No 2] [2010] WASC 225

MURPHY JA: This is an application in the appeal for security for costs by the respondent in the sum of $35,000. The appellant has appealed against a decision of the primary judge in relation to a personal injuries claim by the appellant. The appellant had been injured in a motor vehicle accident on 13 January 2009. Liability was admitted and the trial concerned quantum only. The appellant had claimed damages in the order of $750,000. She was awarded approximately $38,000.
As to costs, the appellant received an order for the payment of her costs up to 8 April 2011, but was ordered to pay the respondent's costs after that date. The evidence is that the costs payable by the appellant to the respondent will greatly exceed the costs payable by the respondent to the appellant, although at this stage neither party has taxed their costs.
The appellant in this appeal seeks a retrial.
The relevant procedural history is as follows:
a)judgment was given on 3 August 2012;
b)a suspension order was made by the primary judge in relation to the payment of damages;
c)the appellant's notice of appeal was filed on 22 August 2012;
d)on 17 September 2012, solicitors for the respondent inquired of the appellant's solicitors as to whether they would consent to an order for security for costs. By letter dated 20 September 2012, the appellant's solicitors responded in the negative;
e)the appellant's case was filed on 17 October 2012 and an amended case was filed on 14 November 2012;
f)the appellant's certificate of compliance was filed on 26 November 2012;
g)the respondent's answer was filed on 18 December 2012;
h)the respondent's reply to the appellant's chronology was filed on 18 December 2012;
i)the parties attended a conference before Registrar Eldred to settle the appeal books on 17 January 2013;
j)the respondent's application for security for costs was filed on 18 January 2013;
k)the respondent's certificate of compliance was filed on 24 January 2013.
It is apparent that, despite having raised the question of security virtually at the outset of the appeal, the respondent left her application until after the completion of all the interlocutory steps in the appeal.
As to the expected time of the appeal, each party expects that the oral presentation of their submissions will take two hours, so that the appeal is expected to take four hours in total.
The matters alleged by the respondent upon which she seeks security for costs are as follows:
a)the appellant is not ordinarily a resident in Australia and has her place of employment in Chile;
b)the appellant has no assets in Australia or Western Australia;
c)the appellant has provided no evidence of her financial means;
d)there is a real prospect that any order for costs made against the appellant would not be enforceable. In this regard it was said, without any explanation or elaboration, that Chile is not a reciprocating country in respect of the enforcement of money judgments given by the Supreme Courts of Australia under the Foreign Judgments Act 1991 (Cth) and the Foreign Judgments Regulations 1992 (Cth);
e)there is no prejudice to the appellant;
f)the appellant does not have 'an overwhelming case or, indeed, even a particularly strong case' and, in this regard, the appellant has submitted 50 grounds of appeal, many of which deal with issues of credibility.
On the question of residence in Australia, the primary judge found, in the decision under appeal (Alfaro v Brokesova [2012] WADC 122 [238(xvi)]), that:
•the appellant's evidence was that she went to Santiago in April 2010;
•her father and his partner also simultaneously went to reside there;
•prior to her departure, the appellant sold the car she had purchased approximately 12 months earlier;
•several months after her arrival in Santiago, the appellant shifted into her own apartment where, save for several short trips to Perth relating to these proceedings, she has since resided;
•since shifting to Santiago, the appellant has pursued professional qualifications to enable her to work as a psychologist in Chile.
The respondent provided a minute of a draft bill of costs which indicates that the costs of the appeal are likely to be $38,882.25.
The appellant resists the application for security for costs on the basis that:
a)the appellant is habitually and ordinarily a resident within Western Australia;
b)the appellant is unlikely to be able to provide security for costs, such that any order would effectively stop her appeal;
c)the costs expended by the appellant to date in the prosecution of the appeal, in the order of $20,000, are likely to be lost if an order for security for costs was now made;
d)the respondent delayed in bringing the application and there are only limited steps to be taken to conclude the appeal;
e)the respondent's costs in relation to counsel's fees for preparation of the respondent's answer, as disclosed in the draft bill of costs, are likely to be overstated by about 20% because they exceed the permissible scale pursuant to s 27A of the Motor Vehicle (Third Party Insurance) Act1943 (WA);
f)the appellant has arguable grounds and reasonable prospects for success in the appeal;
g)the appellant has a 'connection' to the jurisdiction and has an intention to return to the jurisdiction.
The respondent's application is made pursuant to pt 5 r 44(1) of the Supreme Court (Court of Appeal) Rules 2005 (WA), read with the definition of 'interim order' in pt 1 r 3. Whilst the discretion of the court to make an order for security for costs is unfettered, some of the factors which are relevant to the exercise of this discretion include those described in Dodds v Kennedy [2011] WASCA 32 [8] [10]. Also, the observations of Newnes J (as his Honour then was) in Mabrouk Minerals Pty Ltd v Mabrouk Holdings Ltd [2008] WASC 132, although made with reference to security in first instance proceedings, are pertinent:
The fact that a plaintiff is ordinarily resident out of the jurisdiction is a ground upon which an application for security for costs may be granted: O 25 r 2(a). The basis of the rule in O 25 r 2(a) is the risk that either an order for costs is likely to be unenforceable or that it will be enforceable only by a significant expenditure of time and money: Berkeley Administration Inc v McClelland [1990] 1 All ER 958, 963. But while residence out of the jurisdiction enlivens the court's jurisdiction, it is not of itself a sufficient ground for making an order. Whether or not an order will be made will depend upon the circumstances of the case. In Energy Drilling Inc v Petroz NL [1989] ATPR 50,418, Gummow J put the position as follows:
The purpose of ordering security for costs against an applicant ordinarily resident outside the jurisdiction is to ensure that a successful respondent will have a fund available within the jurisdiction of this Court against which it can enforce the judgment for costs, so that the respondent does not bear the risk as to the certainty of enforcement in the foreign country and as to the time and complexity of the action there which might be necessary to effect enforcement: Kent Heating Ltd v Cook-on-Gas Products Pty Ltd (1984) 59 ALR 277 at 279. On the other hand, the mere circumstance that an applicant is resident outside the jurisdiction does not necessarily invite an exercise of discretion in favour of ordering security, the question being how justice will best be served in the particular case. [50,422]
Where a party resident out of the jurisdiction has no assets within the jurisdiction, that will usually be a factor weighing heavily in favour of an order for security. In PS Chellaram & Co Ltd v China Ocean Shipping Co, McHugh J said:
… the fact that a party, bringing proceedings, is resident out of the jurisdiction and has no assets within the jurisdiction has been seen as a circumstance of great weight in determining whether an order for security for costs should be made. Indeed, for many years the practice has been to order such a party to provide security for costs unless that party can point to other circumstances which overcome the weight of the circumstance that that person is resident out of and has no assets within the jurisdiction. (323)
But it will generally not be appropriate to order security if the court is satisfied that the plaintiff has assets within the jurisdiction which will remain available to meet the defendant's costs if the plaintiff is unsuccessful at trial [58] [60].
On the question of delay, although the party against whom security is sought may not prove what would have been done had the application been brought timeously, it would ordinarily be unreasonable to deny some prejudice to that party arising from the delayed application: Green (as liquidator of Arimco Mining Pty Ltd) v CGU Insurance Limited [2008] NSWCA 148 [57]; Technomin Australia Pty Ltd v Xstrata Nickel Australasian Operations Pty Ltd [No 2] [2010] WASC 225 [24].
In this case, the respondent relied on affidavits by the respondent's solicitor dated 18 January 2013 and 22 August 2012 (the latter was annexed to the former). The appellant relied upon the appellant's affidavit of 24 January 2013 and an affidavit by the appellant's solicitor also dated 24 January 2013. The original of the appellant's affidavit had not arrived from Chile and was, on its face, irregularly sworn. Nevertheless, no issue was taken by the respondent's counsel as to the reception of her evidence.
In her affidavit, the appellant gave her address as a place in Chile. It is implicit in her affidavit that she also works in Chile. She also deposed to the effect that whilst her 'matter [was] being litigated' she was 'temporarily' resident in Chile; that her family had originally migrated to Australia in 1986; that her mother and brother still live here; that she 'habitually and ordinarily reside[s]' here; and that it 'is and has always been [her] intention to live in Western Australia'. She also said, without any evidence as to her assets and liabilities, that if security for costs was ordered, she 'would not at this time be able to provide the security and would essentially lose [her] right to appeal and the considerable costs that [have been] incurred to date in prosecuting this appeal'.
There was undisputed evidence to the effect that the appellant had no assets in Western Australia or Australia, except the judgment debt of approximately $38,000 against the respondent, payment of which has been suspended. That chose in action is not, in my view, in any practical sense, an asset which could properly be regarded as security for the respondent's costs in this appeal.
I accept that the appellant has an arguable case the respondent did not contend otherwise but it is impossible at this point to assess its prospects of success. I also accept that the delay is serious ‑ not in absolute terms as to the period of time involved (four months), but in terms of the respondent having delayed her application until, in effect, the appeal is ready to be heard. Taking everything into account, in my view, security for costs should be ordered. I find that the appellant is not, in fact, resident in the jurisdiction for present purposes, and that she resides and works in Chile. Her statement that she is 'habitually and ordinarily' resident in Western Australia is a bare conclusionary statement which is not supported by any detailed evidence in her affidavit. Such details as appear in her affidavit do not provide any basis for concluding that the primary judge's findings, referred to in [8] above, were not accurate or no longer continue to be accurate. Also, her expression of an intention to live in Western Australia is unhelpful in its generality. In any event, even if she were to be regarded as resident here for present purposes, the fact that she has no assets within the jurisdiction is, to my mind, the more compelling factor. Whilst there was no expert evidence as to whether and, if so, how a judgment of this court in respect of costs could be enforced in Chile, I would infer that even if it was enforceable, its enforcement would involve some significant expenditure of time and money. That consideration has added importance in relation to an appeal where the appellant has already had her 'day in court'. The respondent to an appeal who applies for security for costs against the appellant is in a stronger position than a defendant at first instance, in that the respondent to the appeal has the benefit of the judgment which is presumed to be correct until displaced.
Whilst the respondent's delay, for which there is no proper explanation, is one factor which points the other way, I am satisfied that any prejudice to the appellant in that regard may be accommodated by an order that the security, in effect, covers the period only from the date of the application to the conclusion of the appeal. I do not accept the appellant's broad conclusionary statement that she is unable to provide security and that an order against her would thereby stifle the appeal, or would result in her costs to date being wasted, as having any real cogency. No financial details are provided and all that is really known is that she does not have any assets in Australia.
In relation to the quantum of security to be provided, the respondent's draft bill of costs covers five items. The first three items (including counsel's fees in relation to the respondent's answer which the appellant complains is overstated by 20%) relate to costs which were incurred prior to the filing of the application for security. As indicated above, these itemised costs will not form the basis of the order for security. The remaining two items, in relation to getting up for the appeal and counsel's fee on the hearing of the appeal, total approximately $14,500. In relation to the second of those items, the appellant contends that the amount is overstated in that it relates to a full day of hearing, rather than the four hours estimated by the parties. Taking a broad view, and bearing in mind that the court does not set out to give a complete indemnity (see Brundza v Robbie & Co[No 2] [1952] HCA 49; (1952) 88 CLR 171, 175), I would, in all the circumstances, order security in the sum of $12,000.