Dee-Tech Pty Limited v Neddam Holdings Pty Limited

[2009] NSWSC 1095

CITATION:	Dee-Tech Pty Limited v Neddam Holdings Pty Limited [2009] NSWSC 1095
HEARING DATE(S):	12 October 2009
JUDGMENT OF:	Gzell J
EX TEMPORE JUDGMENT DATE:	12 October 2009
DECISION:	Application refused.
CATCHWORDS:	PROCEDURE - Security for Costs - renewed application on first day of trial - challenge to statement of assets and liabilities before the court on previous application - no explanation for delay in bringing renewed application - plaintiff by and large in the position of the defendant
LEGISLATION CITED:	Uniform Civil Procedure Rules 2005 Corporations Act 2001 (Cth)
CASES CITED:	Acohs Pty Ltd v Ucorp Pty Ltd [2006] FCA 1279; (2006) 155 FCR 181 Estates Property Investment Corporation Ltd v Pooley (1975) 3 ACLR 256 Willey v Synan (1935) 54 CLR 175
PARTIES:	Dee-Tech Pty Limited (First Plaintiff/First Cross-Defendant) Bright Star Laundry Pty Limited (Second Plaintiff/Second Cross-Defendant) Neddam Holdings Pty Limited (Defendant/Cross-Claimant) Rhonda Daily Slattery (Third Cross-Defendant) Bennett Joseph Slattery (Fourth Cross-Defendant) Leon Murray Slattery (Fifth Cross-Defendant) Noela Joyce Streltschenko (Sixth Cross-Defendant) Eugene Streltschenko (Seventh Cross-Defendant)
FILE NUMBER(S):	SC 2447/07
COUNSEL:	M Tyson (Plaintiff/First to fourth Cross-Defendants) M Moir (Defendant/Cross-Claimant)
SOLICITORS:	W Lawyers (Plaintiff/First to fourth Cross-Defendants) Cameron & Myers Solicitors (Defendant/Cross-Claimant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

MONDAY 12 OCTOBER 2009

2447/07 DEE-TECH PTY LTD & ANOR v NEDDAM HOLDINGS PTY LTD

EX TEMPORE JUDGMENT

1 This matter came before me last Wednesday when I made some last minute directions, the trial having been set down to commence before me today for five days. On that occasion counsel for the defendant foreshadowed an application for security for costs.

2 That application has now been made under the Uniform Civil Procedure Rules 2005, Pt 42 r 21 or under the Corporations Act 2001 (Cth), s 1335(1).

3 An application for security for costs was made last year and the application was refused. What was before the Registrar on that occasion was a statement of assets and liabilities of the plaintiffs.

4 Leave was given today to file in court an affidavit of Malcolm Bruce Cameron sworn on 2 October 2009 in support of the application. That support is based on three fronts.

5 First, there is a challenge to the statement of assets and liabilities to which I have referred. Secondly, there is the catalogue of correspondence with respect to alleged outstanding payment of outgoings and, thirdly, there is the allegation that the request for production of financial information has not been answered.

6 With respect to the first line of attack, the information has been available to the defendant during this year. One of the properties which was listed in the statement of assets and liabilities was sold on 29 July 2009 and the solicitors for the defendant were thereby armed with information that challenged the value that was placed upon the property in the statement of assets and liabilities.

7 Likewise with respect to the other property, an estimation of its value had been obtained on 21 August 2009.

8 A motor vehicle had been included in the list of assets and liabilities and the solicitor, applying the information in the Red Book, has stated that the motor vehicle is worth less than the figure set out in the statement of assets and liabilities. Again, that calculation could have been made at an earlier time than the first day of this hearing.

9 With the plant and equipment that was set out in the statement of assets and liabilities, the solicitor has applied depreciation rates available for taxation purposes to arrive at a figure that he says is the estimated current value. I place little emphasis on that evidence. Valuations and net asset values for income tax purposes can vary considerably.

10 The non-payment of outgoings was first raised in February this year and the complaint continued until 16 September 2009. The request for up to date financial documents was made on 3 September 2009. No explanation is given for the failure to bring the renewed application for security for costs before counsel foreshadowed that it would be made last Wednesday.

11 Delay is a matter to be taken into account in dealing with an application such as this. In Acohs Pty Ltd v Ucorp Pty Ltd [2006] FCA 1279; (2006) 155 FCR 181 at 203 [61], Jessup J said it was accepted in the authorities that it is necessary to look not only at the delay as such but also at the reason for it and the things which the parties have done in the meantime.

12 While an application for security for costs after a trial has commenced may succeed, as was the case in Estates Property Investment Corporation Ltd v Pooley (1975) 3 ACLR 256, I suggest that such instances will be rare.

13 In submissions by the plaintiffs, the argument was raised that they were not really the moving parties. In Willey v Synan (1935) 54 CLR 175 in a claim by the finder of silver coins, the Collector of Customs required the plaintiff to commence an action. The Collector of Customs then applied for security for costs. It was held that by reason of its notice requiring the plaintiff to commence proceedings, the plaintiff was, in substance, in the position of a defendant and security for costs should not be ordered.

14 While there are some matters in the statement of claim in which the plaintiffs are the moving parties, the substance of the pleading in their behalf is one of defence to claims by the defendant that it is entitled to forfeiture of a lease and the retaking of possession thereunder.

15 In my view, it is inappropriate in the circumstances of this case for the court to be asked to deal with an application for security for costs on the first day of the trial and in light of the non-explanation for the defendant’s delay and in light of the nature of the proceedings on behalf of the plaintiffs being largely ones of defence, I reject the application.

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