Delta Electricity v Blue Mountains Conservation Society Inc

New South Wales

Court of Appeal

CITATION: Delta Electricity v Blue Mountains Conservation Society Inc (security for costs) [2010] NSWCA 264

HEARING DATE(S): 16 March 2010

JUDGMENT DATE:
18 October 2010

JUDGMENT OF: Beazley JA at 1; Basten JA at 1; Macfarlan JA at 1

DECISION: The summons for leave to appeal in the security for costs matter is dismissed with costs.

PARTIES: Delta Electricity (Appellant)
Blue Mountains Conservation Society Inc (Respondent)

FILE NUMBER(S): CA 2009/298558

COUNSEL: B Coles QC; H Irish (Appellant)
TG Howard (Respondent)

SOLICITORS: Middletons (Appellant)
Environmental Defenders Office (Respondent)

LOWER COURT JURISDICTION: Land & Environment Court

LOWER COURT FILE NUMBER(S): LEC 40358/2009

LOWER COURT JUDICIAL OFFICER: Pain J

LOWER COURT DATE OF DECISION: 9 September 2009

LOWER COURT MEDIUM NEUTRAL CITATION: Blue Mountains Conservation Society Inc v Delta Electricity [2009] NSWLEC 150

- 2 -

CA 2009/298558

BEAZLEY JA
BASTEN JA
MACFARLAN JA
18 October 2010

Delta Electricity v Blue Mountains Conservation Society Inc

Judgment (security for costs)

1 THE COURT: The applicant seeks leave to appeal from an order made by Pain J in the Land and Environment Court in which her Honour ordered that the respondent pay $20,000 as security for costs (the security for costs matter). The summons is associated with the summons for leave to appeal, in CA 2009/298528, from her Honour’s order in the same proceeding that the maximum costs which may be recovered by one party from another in the proceedings is the sum of $20,000 (the maximum costs order matter).

2 In the maximum costs order matter, the Court proposes to grant leave to appeal, but to dismiss the appeal. Leave to appeal in the security for costs matter should be refused.

3 The trial judge held, at [36], that the application for security for costs had to be determined on the basis that her Honour had made an order under UCPR, r 42.4 in the sum of $20,000. The applicant contended that in approaching the matter in this way, the trial judge erred, in that she unjustifiably restricted her discretion, acted upon a wrong principle, and allowed extraneous or irrelevant matters to guide or affect her.

4 Other arguments were made, but we do not consider it necessary to deal with them. The purpose in ordering security for costs is to provide protection to a party brought into litigation by a party who is unable to meet the costs of that other party, should the litigation be unsuccessful. In the ordinary course, the amount of security is directed to the likely reasonable costs to be incurred. In this case, it has been determined that the maximum costs that may be recovered from the respondent is $20,000. To require the provision of security in an amount which entirely ignores that order would undermine the Court’s existing order.

5 The summons for leave to appeal in the security for costs matter is dismissed with costs.

**********

CaseChat Overview and Summary

The dispute before the Court of Appeal of New South Wales concerned an application by Delta Electricity for security for costs against the Blue Mountains Conservation Society Inc. The Society had commenced proceedings in the Land and Environment Court seeking to challenge a decision by the Independent Planning Commission to approve a new power station. Delta Electricity, as a respondent to those proceedings, sought security for its costs on the basis that the Society was a company limited by guarantee and had insufficient assets to meet any costs order that might be made against it.

The primary legal issue before the Court of Appeal was whether the Land and Environment Court had erred in refusing Delta Electricity's application for security for costs. This involved considering the principles governing the grant of security for costs, particularly in the context of environmental litigation, and whether the Land and Environment Court had properly applied those principles in its assessment of the Society's financial position and the merits of the underlying proceedings.

The Court of Appeal found that the primary judge in the Land and Environment Court had not erred in exercising their discretion to refuse security for costs. The Court of Appeal applied the established principles for security for costs, which require a consideration of the applicant's financial position, the merits of the case, and the potential impact of an order for security on the ability of the respondent to pursue their claim. In this instance, the Court was satisfied that the Land and Environment Court had properly weighed these factors and had not made an error of law or principle in its decision.

Consequently, the summons for leave to appeal in the security for costs matter was dismissed with costs.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

CITATION:	Delta Electricity v Blue Mountains Conservation Society Inc (security for costs) [2010] NSWCA 264
HEARING DATE(S):	16 March 2010
JUDGMENT DATE:	18 October 2010
JUDGMENT OF:	Beazley JA at 1; Basten JA at 1; Macfarlan JA at 1
DECISION:	The summons for leave to appeal in the security for costs matter is dismissed with costs.
PARTIES:	Delta Electricity (Appellant) Blue Mountains Conservation Society Inc (Respondent)
FILE NUMBER(S):	CA 2009/298558
COUNSEL:	B Coles QC; H Irish (Appellant) TG Howard (Respondent)
SOLICITORS:	Middletons (Appellant) Environmental Defenders Office (Respondent)
LOWER COURT JURISDICTION:	Land & Environment Court
LOWER COURT FILE NUMBER(S):	LEC 40358/2009
LOWER COURT JUDICIAL OFFICER:	Pain J
LOWER COURT DATE OF DECISION:	9 September 2009
LOWER COURT MEDIUM NEUTRAL CITATION:	Blue Mountains Conservation Society Inc v Delta Electricity [2009] NSWLEC 150