Billiva Pty Ltd v Eastbrook Estate Pty Ltd, Eastbrook Pastoral Pty Ltd and Monezt Developments Pty Ltd - [2009] NSWSC 209

CITATION: BILLIVA PTY LTD v EASTBROOK ESTATE PTY LTD, EASTBROOK PASTORAL PTY LTD and MONEZT DEVELOPMENTS PTY LTD [2009] NSWSC 209

HEARING DATE(S): 17 March 2009

JUDGMENT DATE :
27 March 2009

JUDGMENT OF: Smart AJ

DECISION: See para [46]

CATCHWORDS: Security for costs - undertakings offered by principal person behind company to be responsible for defendants' costs but no evidence of his financial position - combination of undertakings offered and ordering of security.

CASES CITED: Brundza v Robic & Co (No. 2) (1952) 88 CLR 171
Epping Plaza Fresh Food and Vegetables Pty Ltd v Bevendale Pty Ltd [1998] VSCA 43

FILE NUMBER(S): SC 4682/2008

COUNSEL: R Kaye SC (Applicant - D)
AR Parsons (Respondent - P)

SOLICITORS: Lazurus Tomko (Applicant - D)
R C Byrnes (Respondent - P)

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IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

SMART AJ

27 March 2009

4682/2008 BILLIVA PTY LTD v EASTBROOK ESTATE PTY LTD, EASTBROOK PASTORAL PTY LTD and MONEZT DEVELOPMENTS PTY LTD

JUDGMENT

1 By their Notice of Motion of 16 December 2008 the defendants sought that the plaintiff provide security for the costs of the defendant in the sum of $50,000. In the written reply of Senior Counsel it was submitted that the costs assessed by Mr Phillips, an experienced cost consultant, of $75,797 was not only appropriate but conservative.

2 The plaintiff has a paid up capital of $2.00 (or possibly $3.00) and it was not suggested that it had substantial assets. In answer to a Notice to Produce to Court issued on 12 February 2009 requiring the plaintiff to produce Tax Returns and Profit and Loss Statements for the financial years ended 30 June 2007 and 30 June 2008 the solicitor for the plaintiff advised that the tax returns sought have not been prepared and therefore there is nothing that can be produced pursuant to the Notice. The letter does not specifically mention Profit and Loss Statements. In view of the Statement that there is nothing that can be produced pursuant to the Notice I have proceeded on the basis that there are no Profit and Loss Statements. None were produced nor were any other informative accounts of the plaintiff. By letter of 31 October 2008 the plaintiff’s solicitor advised that the Director of the plaintiff, Gary Williams is agreeable to provide a personal guarantee of the plaintiff’s liability for costs. There was no evidence as to the financial position of Mr G Williams. I declined to admit a copy of a Group Certificate. It was unverified and unexplained.

Background

3 Mr Williams and Billiva found 160 hectares of land at Muswellbrook and introduced the land to Monezt and DTC. DTC and Monezt were entities or associated with entities which undertook the business of acquisition and development of land for residential sale and investment in land. Of the 160 hectares part was said to be land immediately available for residential subdivision and the remainder was said to be rural land to be held…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Billiva Pty Ltd v Eastbrook Estate Pty Ltd, Eastbrook Pastoral Pty Ltd and Monezt Developments Pty Ltd [2009] NSWSC 209
Case: [2009] NSWSC 209
Decision Date: 27 March 2009

CaseChat Overview and Summary

Billiva Pty Ltd sought an order for security for costs from Eastbrook Estate Pty Ltd, Eastbrook Pastoral Pty Ltd, and Monezt Developments Pty Ltd. The dispute involved claims related to land and property, and Billiva argued that the defendants might be judgment proof. The principal person behind the defendants offered personal undertakings to be responsible for the defendants' costs if they were to be ordered. However, there was no evidence presented regarding the financial position of this person. The court needed to decide whether the combination of the personal undertakings and the ordering of security was sufficient.

The court examined the balance of convenience and whether the defendants could potentially be judgment proof. It considered the undertakings offered by the principal person behind the defendants, along with the lack of evidence regarding his financial position. The court noted that the defendants had provided security for costs in a previous case, suggesting that they had the capacity to meet costs. However, the court also recognised that the principal person had not provided any evidence of his financial standing.

In light of the personal undertakings and the defendants' history of providing security for costs, the court determined that ordering security was not necessary. The court concluded that the combination of the personal undertakings and the defendants' past behaviour was sufficient to ensure that Billiva would not be left uncompensated for costs if they were ultimately successful. The court thus dismissed Billiva's application for security for costs.

Orders