Capital Securities XV Pty Ltd (formerly known as Prime Capital Securities Pty Ltd) v Calleja

Capital Securities XV Pty Ltd (formerly known as Prime Capital Securities Pty Ltd) applied to the Court of Appeal of New South Wales for a stay of certain orders made by the Supreme Court. The dispute arose from a financing agreement where the appellant lent money to the respondents, secured by a mortgage over property. The respondents were unable to meet their loan commitments, and the appellant's application for possession of the property was dismissed by the primary judge. The appellant sought a stay of the orders that provided for the discharge of the mortgage and security deeds pending the determination of its appeal.

The Court was required to determine whether to grant a stay of the primary judge's orders. This involved considering whether the refusal of a stay was likely to result in the loss of the subject matter of the appeal. Additionally, the Court considered a separate motion by the respondents seeking security for their costs of the appeal, pursuant to section 1335 of the *Corporations Act 2001* (Cth) and rules 51.50 and 42.21 of the *Uniform Civil Procedure Rules 2005* (NSW). This required assessing whether there was sufficient doubt regarding the appellant's ability to pay the respondents' costs if the appeal were unsuccessful.

Basten JA granted the stay of the orders relating to the discharge of the mortgage and security deeds, finding that their discharge would likely render the appeal nugatory. The Court reasoned that the purpose of the appeal was to maintain the security, and allowing its discharge would defeat the appellant's objective. Regarding the security for costs application, the Court dismissed the respondents' motion, indicating that the threshold for ordering security had not been met.

The Court ordered that the operation of the Supreme Court's orders (10), (11), and (12) made on 6 December 2017 be stayed pending the determination of the appeal. The costs of the motion for the stay were made the appellant's costs in the appeal. The respondents' motion seeking security for costs was dismissed, with the costs of that motion also ordered to be the appellant's costs in the appeal. Directions were given for the matter to be listed before the Registrar to ensure readiness for the appeal hearing scheduled for 29 January 2018.