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Chong v Super Equity Invests Pty Ltd

Chong v Super Equity Invests Pty Ltd

Case [2012] NSWSC 27 2 February 2012

Standing

Security for Costs

Competing Claimants

Civil Litigation & Procedure

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Supreme Court

New South Wales

Medium Neutral Citation: Ruth Chong v Super Equity Invests Pty Ltd & Anor [2012] NSWSC 27
Hearing dates: 2 February 2012
Decision date: 02 February 2012
Jurisdiction: Equity Division
Before: Slattery J
Decision:
Security for costs not ordered.

Catchwords: PRACTICE AND PROCEDURE - security for costs - surplus funds after first mortgagee exercises power of sale paid into court - competing claimants under Real Property Act, s 58(3) to funds in Court - whether one claimant to the fund should have security for costs against another claimant to the fund, a company in liquidation.
Legislation Cited: Corporations Act 2001, s 1335
Real Property Act 1900
Trustee Act 1925, part 4
UCPR 2005, Part 55 Division 3, r 42.2(1)
Cases Cited: Black v Freedman & Co (1990) 12 CLR 105
Commonwealth Bank v Estate of late Slieman [2010] NSWSC 661
Concrete Constructions v Dalma Formwork Pty Ltd [1999] NSWCA 16
Crestland Investments Pty Ltd v Parisi Holdings Pty Limited [2004] WASC 57
Crestland Investments Pty Ltd v Parisi Holdings Pty Limited [2003] WASC 181
Greater Pacific Investments (in liq) v Australian National Industries Ltd (1996) 39 NSWLR 143
KP Cable Investments Pty Ltd v Melt Globe Pty Ltd (1995) 56 FCR 189
La Trobe Capital & Mortgage Corp Ltd, Re [2009] NSWSC 1118
Muschinski v Dodds (1985) 160 CLR 583
Rajski & Anor v Computer Manufacture and Design Pty Ltd & Ors (1982) 1 NSWLR 443
Re Emery (deceased) (1923) P 184
Residential Housing Corporation v Esber [2011] NSWCA 25
Rowe v Epstein (1974) 1 WLR 1565
Sydmar Pty Limited v Statewise Developments Pty Ltd (1987) 73 ALR 289
Category: Interlocutory applications
Parties: Plaintiff:- Ruth Chong
First Defendant:- Super Equity Invests Pty Ltd (in liquidation)
Second Defendant:- Sui Generis (Global) Pty Ltd
Representation: Plaintiff:- D.K.L. Raphael
First Defendant:- S.Cirillo
Second Defendant:- D.Oliveri

File Number(s): 2010/413320
Publication restriction: No

EX TEMPORE Judgment

This is another case in which parties before the court are left to debate which of them will bear the losses resulting from a person's alleged fraud upon all of them.

The plaintiff, Ruth Chong, the first defendant, Super Equity Investments Pty Ltd ("Super Equity") and the second defendant, Sui Generis (Global) Pty Ltd, ("Sui Generis") are all claimants to a fund of money paid into court by Permanent Custodians Limited. The money, a sum of $318,494.17 plus interest was paid into court in December 2010. The funds so paid into court are the surplus proceeds of sale of a residential property in Angelo Street Burwood formerly owned by Ms Chong.

The main point at issue that comes before the court today is the question of whether or not in the resolution of the competing claims to this fund the plaintiff is entitled to an order that the first defendant, Super Equity, a company in liquidation, should provide security for the plaintiff's costs of pursuing the fund. For reasons that I will explain in this judgment, I have reached the view that security should not…

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.

Continue reading Chong v Super Equity Invests Pty Ltd

Details

AGLC: Ruth Chong v Super Equity Invests Pty Ltd & Anor [2012] NSWSC 27
Case: [2012] NSWSC 27
Decision Date: 02 February 2012

CaseChat Overview and Summary

The matter before the court involved a dispute between Chong and Super Equity Invests Pty Ltd regarding the distribution of surplus funds following the exercise of a power of sale by a first mortgagee. The funds were paid into court, and both parties claimed entitlement to the surplus under section 58(3) of the Real Property Act. The primary focus was on whether one claimant, Chong, should be required to provide security for costs against the other claimant, a company in liquidation.

The court was required to address the issue of whether a claimant to surplus funds paid into court, who is not a party to the proceeding that generated the funds, must provide security for costs against another claimant. The specific question was whether Chong, an individual claimant, needed to provide security for costs against the company in liquidation, which was also a claimant to the same funds.

The court held that the requirement for security for costs is discretionary and is based on the principles of justice and fairness. It considered the financial positions of both parties and the potential impact on the administration of justice. The court concluded that it was not necessary to require Chong to provide security for costs against the company in liquidation because doing so would not serve the interests of justice. The court determined that the company's status as a party in liquidation and its financial standing did not warrant the imposition of such security.

In light of the court's decision, it ordered that Chong should not be required to provide security for costs against Super Equity Invests Pty Ltd. The court directed that the surplus funds be distributed according to the claimants' respective entitlements under the Real Property Act.

Orders