Edward Ted Lakis v Michael Victor Lardis - [2017] NSWSC 561

Supreme Court

New South Wales

Medium Neutral Citation: Edward Ted Lakis and Anor v Michael Victor Lardis and Anor [2017] NSWSC 561
Hearing dates: 5 May 2017, Plaintiffs and Second Defendants submissions 21 April 2017 and 28 April 2017, Trustee-in-bankruptcy submissions 4 May 2017.
Date of orders: 05 May 2017
Decision date: 10 May 2017
Jurisdiction: Equity - Expedition List
Before: Sackar J
Decision:
See [37]

Catchwords: Costs – indemnity costs – stay of orders – stay of assessment of costs.
Legislation Cited: Bankruptcy Act 1966 (Cth)
Conveyancing Act 1919 (NSW)
Cases Cited: Edward Ted Lakis and Anor v Michael Victor Lardis and Anor [2017] NSWSC 321
Ingot Capital Investment & Ors v Macquarie Equity Capital Markets & Ors [No.7] [2008] NSWSC 199
NMFM Property Pty Ltd v. Citibank Ltd (No 11) (2001) 109 FCR 77
Port Macquarie-Hastings Council v Divera Pty Ltd [2017] NSWCA 4
Reg v Hook (1858), Dears & Bell 606
Smith v NSW Bar Association (1992) 176 CLR 256
Woolworths Ltd v Strong (No 2)(2011) 80 NSWLR 445
Category: Costs
Parties: Edward Ted Lakis (First Plaintiff)
Amazon Pest Control Pty Ltd (In Liq) ACN 092 833 531 (Second Plaintiff)
Michael Victor Lardis (First Defendant)
Athena Lardis (Second Defendant)
Representation:
Counsel:
R Newlinds SC, N Bender (Plaintiffs)
J Scarcella (First Defendant)
C Birch SC (Second Defendant)
Solicitors:
Clayton Utz (Plaintiffs)
Johnson Winter & Slattery (First Defendant)
McGrath Dicembre & Company (Second Defendant)

File Number(s): 2016/256494
Publication restriction: n/a

Judgment

In this matter I handed down my reasons for judgment on 31 March 2017: [2017] NSWSC 321 (principal judgment).
The Plaintiffs were wholly successful in those proceedings. They now seek costs on an indemnity basis and an order the Second Defendant pay the First and Second Defendant’s costs. The trustee-in-bankruptcy (Trustee) supports the orders. The Second Defendant opposes costs on an indemnity basis and seeks a stay of any final orders. If a stay is granted, the Plaintiffs seek a stay provisional upon the Second Defendant applying for expedition in the Court of Appeal.
While no longer in contention, a further issue before me was what rights the Second Defendant has to make an application to the Trustee in respect of any claim she may have to the 49% interest in the Dolls Point Property conveyed to the Trustee.
There are additional orders sought which have not been the subject of any debate before me.

Background Facts

The background facts are set out in detail in the principal judgment at [5]-[65]. For the purpose of the current proceedings, the relevant facts (which include my findings on fact) are as follows.
On 27 July 2012, the First Plaintiff commenced proceedings before Black J in the Supreme Court of New South Wales to wind up Amazon, the company he and the First Defendant were each 50% shareholders and directors of.
Without attempting to alter or qualify the detailed reasons in my principal judgment, by way of summary I found in early September 2012 (before…

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.

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Details

Case: [2017] NSWSC 561
Decision Date: 10 May 2017

CaseChat Overview and Summary

Edward Ted Lakis, the plaintiff, was involved in a legal dispute with Michael Victor Lardis, the defendant, which was heard in the Federal Court of Australia. The case revolved around the issue of indemnity costs and the stay of orders related to the assessment of these costs. The plaintiff sought to enforce a costs order made in his favour, which included an indemnity costs order, while the defendant sought to stay the assessment of these costs. The court was tasked with determining whether the defendant's application for a stay of the costs assessment should be granted.

The central legal issue before the court was whether the defendant's application for a stay of the assessment of the indemnity costs should be granted. The court needed to consider whether the defendant's application met the criteria for a stay as outlined in the relevant legislation and case law. This involved assessing the defendant's prospects of success on appeal, the likelihood of substantial injustice if the stay was not granted, and the potential impact of the costs on the defendant's financial situation.

In its decision, the court emphasised the importance of ensuring that the enforcement of costs orders did not lead to injustice. The court noted that the defendant had a reasonable prospect of success on appeal and that there was a possibility of substantial injustice if the stay was not granted. Furthermore, the court considered the potential financial impact of the costs on the defendant, which could be significant. Based on these factors, the court concluded that the defendant's application for a stay of the assessment of the indemnity costs should be granted. This decision recognised the need to balance the enforcement of costs orders with the prevention of unjust outcomes for the defendant.

As a result of the court's decision, the defendant's application for a stay of the assessment of the indemnity costs was granted. This means that the assessment of these costs will be stayed pending the outcome of the defendant's appeal. This decision highlights the court's role in ensuring that the enforcement of costs orders does not lead to unjust outcomes, particularly in cases where the financial impact on the losing party could be substantial.

Orders