Frigger v Kitay

Case [2016] WASCA 173

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT :   THE COURT OF APPEAL (WA)

CITATION:   FRIGGER -v- KITAY [2016] WASCA 173

CORAM:   BUSS P

MURPHY JA

HEARD:   2 SEPTEMBER 2016

DELIVERED          :   2 SEPTEMBER 2016

PUBLISHED           :  7 OCTOBER 2016

FILE NO/S:   CACV 45 of 2016

BETWEEN:   HARTMUT FRIGGER

ANGELA FRIGGER
Appellants

AND

MERVYN JONATHAN KITAY
Respondent

ON APPEAL FROM:

Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA

Coram  :LE MIERE J

Citation  :FRIGGER -v- KITAY [2016] WASC 60

File No  :CIV 1606 of 2015

Catchwords:

Practice and procedure - Application for security for costs in an appeal - Quantum of security - Turns on own facts

Legislation:

Nil

Result:

The respondent's application for security for costs allowed

Category:    B

Representation:

Counsel:

Appellants:     In person

Respondent:     Mr D W John

Solicitors:

Appellants:     In person

Respondent:     Herbert Smith Freehills

Case(s) referred to in judgment(s):

Ailakis v Olivero [2013] WASCA 91

Boksmati v Girgis Nominees (WA) Pty Ltd [2014] WASCA 101

Commonwealth of Australia v Eise (1991) 6 ACSR 1

Dodds v Kennedy [2011] WASCA 32

Frigger v Clavey Legal Pty Ltd [No 2] [2015] WASCA 258

Frigger v Kitay [2016] WASC 60

Frigger v Kitay [2016] WASC 60 (S)

Frigger v Professional Services of Australia Pty Ltd [2015] WASCA 3

George 218 Pty Ltd v Bank of Queensland Ltd [2016] WASCA 56

Mann v Dabelstein [2006] WASCA 176

Philips Electronics Australia Pty Ltd v Matthews [2002] NSWCA 157; (2002) 54 NSWLR 598

Professional Services of Australia Pty Ltd (Administrator Appointed) v Computer Accounting and Tax Pty Ltd [No 3] [2010] WASC 93

Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [2010] WASC 38

Sims v Suda Ltd [No 2] [2015] WASCA 180

REASONS OF THE COURT:   

Introduction

  1. On 2 September 2016, we made certain orders including that the appellants pay $25,000 into court by way of security for the respondent's costs of the appeal.  We said we would subsequently provide written reasons.  These are our reasons.

  2. In April 2015, the appellants (Mr and Mrs Frigger) lodged an appeal against a decision of Le Miere J.  Le Miere J's decision was given in the matter of CIV 1606 of 2015 (primary proceedings).  His Honour had permanently stayed the primary proceedings, which had been commenced by Mr and Mrs Frigger.  His Honour also made other orders against Mr and Mrs Frigger.  His Honour's reasons are contained in Frigger v Kitay [2016] WASC 60 (principal reasons) and Frigger v Kitay [2016] WASC 60 (S) (supplementary reasons).

  3. In the primary proceedings, Mr and Mrs Frigger alleged that the respondent (Mr Kitay), in his capacity as liquidator of Computer Accounting and Tax Pty Ltd (in liq) (CAT), had engaged in certain breaches of fiduciary duty and contraventions of the Corporations Act 2001 (Cth). Mr Kitay applied to have the proceedings against him permanently stayed on the ground that Mr and Mrs Frigger did not have leave to commence the proceedings against him, being a court‑appointed…

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Frigger v Kitay [2016] WASCA 173
Case
[2016] WASCA 173
Decision Date

CaseChat Overview and Summary

In the case of Frigger v Kitay, the appellants, Mr and Mrs Frigger, sought to appeal against the orders made by the primary judge. Mr Kitay, the respondent, applied for security for costs in relation to the appeal. The primary judge had earlier found that the appellants' claims were either an abuse of process or had no reasonable prospect of success, and had therefore permanently stayed the proceedings. The appellants argued that the respondent was only partly successful in his chamber summons and was not entitled to more than 50% of the costs of the application. The respondent, on the other hand, contended that he was substantially successful and should be awarded the costs of the application.

The legal issues before the court were whether the appellants should pay the respondent's costs of the proceedings and, if so, on what basis. The court was also required to determine the appropriate quantum of security for costs in the appeal, given that the case turned on its own facts. The court considered the submissions made by both parties and the orders proposed by the respondent.

In its decision, the court held that the appellants should pay the respondent's costs of the proceedings. The court found that the appellants' refusal of the offer of compromise made by the respondent was unreasonable. Furthermore, the court found that the appellants had persisted in pursuing a hopeless case and had raised allegations that amounted to an abuse of process. The court therefore ordered that the appellants pay the respondent's costs incurred on and after 11 June 2015 on an indemnity basis. The court also ordered that the appellants pay the respondent's costs of the proceedings, including the costs of the appeal, on an indemnity basis. The court further ordered that the proceedings be permanently stayed and that the appellants pay the respondent's costs of the entire proceeding.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

In the supplementary reasons, his Honour referred to the orders which had been proposed by Mr Kitay pursuant to those directions, and continued:[3][3] Supplementary reasons [4] - [10].Orders to give effect to reasons for judgmentThe orders proposed by [Mr Kitay] in pars 1 to 4 above are appropriate and [Mr and Mrs Frigger] have made no submissions to the contrary. Accordingly, there will be orders in those terms.[Mr Kitay] moves for an order that the proceedings be permanently stayed. In correspondence to the court [Mr and Mrs Frigger] say that they will file an application for an order lifting the stay of the proceeding. In [59] of my reasons for judgment I found that the proceedings should be permanently stayed. An order in terms of par 6 set out above will be made.Costs[Mr Kitay] seeks an order that [Mr and Mrs Frigger] pay [Mr Kitay's] costs of the proceedings in accordance with proposed order 5 set out above. [Mr and Mrs Frigger] say that [Mr Kitay] was partly successful in his chamber summons of 30 June 2015 and in the circumstances is only entitled to less than 50% of the costs of the application. [Mr Kitay] was substantially successful. He should have the costs of the application.[Mr and Mrs Frigger] say there is no basis for [Mr Kitay] having the costs of the entire proceeding because where proceedings have been stayed the order does not prevent [Mr and Mrs Frigger] seeking to lift the stay for a good reason. The proceedings were commenced against the liquidator without leave. I found that [Mr and Mrs Frigger's] claims were either an abuse of process or had no reasonable prospect of success. The proceedings are to be permanently stayed. [Mr and Mrs Frigger] should pay [Mr Kitay's] costs of the proceeding.[Mr Kitay] seeks an order that [Mr and Mrs Frigger] pay [Mr Kitay's] costs on an indemnity basis from 11 June 2015. The order is sought on the basis of an offer of compromise made in a letter of 10 June 2015 from [Mr Kitay's] solicitors, Herbert Smith Freehills, to [Mr and Mrs Frigger's] solicitors. In that letter [Mr Kitay] set out in detail the reasons why the amended statement of claim was liable to be struck out and/or why summary judgment ought to be entered for [Mr Kitay]. The letter invited [Mr and Mrs Frigger] to consent to orders dismissing the proceedings and stated that if [Mr and Mrs Frigger] did so [Mr Kitay] would not seek to recover the costs incurred to date. The letter stated that if [Mr and Mrs Frigger] failed to consent to the dismissal of the proceedings [Mr Kitay] reserved the right to rely on the letter in seeking an order for indemnity costs. The compromise offered was that [Mr Kitay] would not seek to recover [his] costs to the date of the letter. Such a concession can properly be described as a compromise: Globaltech Pty Ltd v Pareek [2006] WASC 30(S). In my opinion [Mr and Mrs Frigger's] refusal of the offer was unreasonable.Furthermore, [Mr and Mrs Frigger] persisted to pursue a hopeless case and to raise allegations which amounted to an abuse of process. [Mr and Mrs Frigger] should pay [Mr Kitay's] costs incurred on and after 11 June 2015 on an indemnity basis.

Ratio Decidendi

Legal Principle Established

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