At Air Group Pty Ltd v Dieter Siewert
[2013] NSWSC 1993
•18 November 2013
Supreme Court
New South Wales
Medium Neutral Citation: AT Air Group Pty Ltd v Dieter Siewert [2013] NSWSC 1993 Hearing dates: 18 November 2013 Decision date: 18 November 2013 Jurisdiction: Equity Division - Corporations List Before: Brereton J Decision: Proceedings stayed until security for costs provided
Catchwords: COSTS - security for costs - where no contest between parties in respect of making of an order for security of costs - quantum of security for costs - whether proposed sums are reasonable estimates of costs of remainder of proceedings - no question of principle. Category: Interlocutory applications Parties: AT Air Group Pty Ltd (first plaintiff)
Ross Edward Seller (second plaintiff)
Aquatic Air Pty Ltd (third plaintiff)
Avtex Air Services Pty Ltd (fourth plaintiff)
Dieter Siewert (first defendant)
Lieselotte Siewert (second defendant)
Heron Airlines Travel Pty Ltd (third defendant)
Wingaway Air Pty Ltd (in liq) (fourth defendant)
AT Air Group Pty Limited (in liq) (fifth defendant)Representation: Counsel:
I M Jackman SC (plaintiff)
B Debuse (first & second defendants)
Solicitors:
Bartier Perry (third plaintiff)
Marsdens Law Group (first & second defendants)
ERA Legal (third defendant)
O'Neill Partners (fifth defendant)
File Number(s): 2012/169096
Judgment - EX TEMPORE
HIS HONOUR: On 7 August 2012, Registrar Howard made an order for security for costs of the first and second defendants in the sum of $180,000 and reserved liberty to apply for further security. By Notice of Motion filed on 25 October 2013, the first and second defendants seek an order that the third plaintiff provide security for their costs in the further amount of $690,000 and consequential orders.
The plaintiffs do not dispute that the jurisdictional grounds for a further order for security have been established, nor that a further order should be made. The only question is one of quantum and this, in turn, appears to involve no question of principle.
While each party has adduced the evidence of an experienced solicitor as to the estimated costs of the proceedings, ultimately those costs have reasonably been assessed in each case on a fairly broad-axe basis and from the submissions of the parties it reasonably follows that I should take a similar robust approach.
Since the order for security in the sum of $180,000 was made, the defendants have incurred costs of the proceedings in excess of $400,000 on a solicitor-client basis. While the evidence makes some attempt to apportion them between various aspects of the proceedings and various costs orders that have already been made, it seems to me that that exercise does not much matter as, to the extent that it is necessary to attribute some of the costs incurred to those parts of the proceedings in respect of which costs orders have already been made, the balance will remain attributable to the ongoing third plaintiff's claim.
I take the view that while the $400,000 figure itself involves some concessions on account of matters that would probably not be recoverable in the proceedings, it is still a generous figure that funds the litigation at a level higher than an opposing party ought to be required to make provision for by way of security. Reducing it slightly to $360,000, and then broadly approaching it on the basis that about two-thirds of that would be recoverable on a party-party basis, produces a figure of $240,000. Against the $180,000 of the original order, that implies a shortfall of $60,000 to date, which would require topping up.
The question then becomes what is a reasonable estimate of the costs of the remainder of the proceedings from this date until and including the final hearing, the estimates of which vary between five and eight days. It appears that both parties will be represented by senior and junior counsel.
On the one hand, Mr Butterfield, for the defendants, estimates that the solicitor-client costs, including counsel's fees and disbursements and experts and including GST, will be in the order of $615,000 to $743,000. On the other hand, Mr Stuart, for the plaintiffs, estimates that those costs will be - on a party-party basis (that is, allowing for a one third discount) and I think without providing for GST - in the order of $141,000 to $157,000.
Neither of the witnesses was cross-examined. Submissions were made as to why Mr Butterfield's assessment was excessive and, to some extent, those submissions were also answered: but it does not seem to me that in substance there has been any real attack on or undermining of Mr Stuart's evidence.
In a case where the defendants/applicants bear the onus of proving the appropriate amount, it seems to me that insufficient reason has been established in the evidence for rejecting the assessment of Mr Stuart.
Accordingly, I propose to adopt Mr Stuart's assessment as to the future, but the higher end of his range and adding to it, as I think must be done, 10% for GST. Accordingly, his top range figure was $157,704 to which I add $15,770 to produce a total of $173,474, plus the $60,000 shortfall to which I have referred, producing a total of $233,474. I round that to $235,000.
I order that the plaintiffs give further security for the defendants' costs of the proceedings in the sum of $235,000, such security to be provided in a form acceptable to the Registrar.
I order that the proceedings be stayed until the security is provided.
Counsel addressed
Despite Mr Jackman's submission, I think the position is that the defendants had to come to Court to get the relief that they did. They bettered what was on offer so far as the evidence reveals.
In those circumstances, it seems to me that it must follow that the defendants have their costs of the motion, which based on the evidence already filed in the proceedings I assess in the sum of $15,000 inclusive of GST.
I order that the plaintiffs pay the defendants' costs of the motion assessed in the sum of $15,000.
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Decision last updated: 01 July 2014
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