Frigger v Professional Services of Australia Pty Ltd [No 3]

In Frigger v Professional Services of Australia Pty Ltd [No 3], the Full Court of the Federal Court of Australia considered the proper disposal of security for costs paid into court during an appeal. The respondents, who had been successful in the appeal, sought payment of the security. The appellants, who had failed in the appeal, sought an order that the security be held pending the outcome of Federal Court proceedings. The legal issues before the court were whether the security should be paid out to the respondents and whether the security should be held pending the outcome of Federal Court proceedings. The court found that the security should be paid out to the respondents, as the appeal had been finally disposed of either when it was dismissed or when the certificate of taxation was issued. The court also found that there was no basis for holding the security pending the outcome of Federal Court proceedings, as the appellants had not obtained an injunction and had delayed in applying for an interlocutory injunction. The court concluded that the appellants' failure to obtain an injunction and their delay in applying for an interlocutory injunction, along with the lack of a sustainable case in the Federal Court proceedings, counted strongly against the making of the orders sought by the appellants.

The court held that the security should be paid out to the respondents, as the appeal had been finally disposed of either when it was dismissed or when the certificate of taxation was issued. The court noted that the starting point was that the monies paid in as security should now be paid out to the respondents. The court also held that the appellants' alleged counterclaim for an amount of costs did not provide any sound basis to decline to pay, or to delay paying, the Security to the respondents. The court found that the existence of a contested and contestable counterclaim did not provide any sufficient reason for not ordering payment out of moneys paid into court as security for costs to a successful respondent who had the benefit of an order for taxed costs exceeding the amount of the security. The court concluded that there was no reasonably arguable basis on which the Federal Court might restrain the enforcement of the costs order in the appeal, and that the merits of any proceedings commenced in the Federal Court were matters for that court. The court held that the appellants' failure to obtain an injunction and their delay in applying for an interlocutory injunction, along with the lack of a sustainable case in the Federal Court proceedings, counted strongly against the making of the orders sought by the appellants.

The final orders of the court were that the respondents were entitled to payment of the security paid into court, and that the appellants' application to hold the security pending the outcome of Federal Court proceedings be dismissed. The court also held that the appellants' counterclaim for an amount of costs did not provide any sound basis to decline to pay, or to delay paying, the Security to the respondents. The court held that the existence of a contested and contestable counterclaim did not provide any sufficient reason for not ordering payment out of moneys paid into court as security for costs to a successful respondent who had the benefit of an order for taxed costs exceeding the amount of the security. The court concluded that there was no reasonably arguable basis on which the Federal Court might restrain the enforcement of the costs order in the appeal, and that the merits of any proceedings commenced in the Federal Court were matters for that court. The court held that the appellants' failure to obtain an injunction and their delay in applying for an interlocutory injunction, along with the lack of a sustainable case in the Federal Court proceedings, counted strongly against the making of the orders sought by the appellants.