Devenish & Ors v Jewel Food Stores Pty Limited

In the High Court of Australia, the applicants, Michael Gerard Devenish and others, sought an order for security for costs against the respondent, Jewel Food Stores Pty Limited. The application was made by Jewel Food Stores, which argued that the applicants had been funded in the proceedings to date by an outside entity, specifically a contingency fund established by the New South Wales Dairy Corporation. This fund was purportedly for abnormal freight costs, but it appeared that a significant portion, approximately $120,000, had been used to pay the costs of the Milk Vendors Association, which could not be categorised as abnormal freight.

The central legal issue before the Court was whether there was a sufficient inference that the second applicant, the Milk Vendors Association, was unable to meet its own costs, thereby justifying an order for security for costs to be provided by Jewel Food Stores. Jewel Food Stores contended that the cessation of funding from the New South Wales Dairy Corporation, coupled with the apparent misdirection of funds, created a real and substantial inference that the applicants could not afford their own legal expenses. They sought to obtain further documentation to confirm these arrangements and establish the basis for the security application.

The Court considered the evidence presented, which included material obtained under freedom of information applications. Jewel Food Stores argued that while they had inferences from documents, they sought to issue subpoenas to obtain the actual arrangements and flesh out the details of the funding. The application for security for costs was based on the submission that the applicants, having been funded by an external source which was now ceasing, could not meet their own costs, and therefore, security should be ordered.