Ghiasvand v Concrete Menders Pty Ltd

[2024] ACTSC 416

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	Ghiasvand v Concrete Menders Pty Ltd
Citation:	[2024] ACTSC 416
Hearing Date:	5 November 2024, 29 November 2024
Decision Date:	23 December 2024
Before:	McWilliam J
Decision:
(1)  The stay of the orders made on 10 October 2024 in the Magistrates Court proceeding CS 60/2023 is conditional upon the payment into Court of the sum of $40,000 as security for the judgment obtained in the court below, pending resolution of the appeal.
Catchwords:	PRACTICE & PROCEDURE – STAY OF JUDGMENT – appeal from Magistrates Court pending – where serious issue for determination exists – stay granted upon payment of security – whether security should include security for costs of appeal – where no application for security for costs before the court –
security limited to proportion of judgment obtained in court below
Legislation Cited:	Court Procedures Rules 2006 (ACT) r 5055
Cases Cited:	Concrete Menders Pty Ltd v Ghiasvand; Ghiasvand v Flexible
Constructions Pty Ltd [2024] ACTMC 23 Alananzeh v Zgool Form Pty Ltd (No 2) [2024] ACTSC 258
Kalifair Pty Ltd v Digi-tech (Australia) Pty Ltd; McLean Tecnic
Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; 55 NSWLR 737 CDLC Pty Ltd v Capital Estate [2024] ACTSC 345 Lucas v Yorke (1984) 58 ALJR 20 Benjamin v GB Franchising Pty Ltd [2008] ACTCA 11; 1 ACTLR 287
Parties:	Kobra Ghiasvand (First Appellant) Ali Ghiasvand (Second Appellant) Concrete Menders Pty Ltd (First Respondent)
Flexible Constructions Pty Ltd (Second Respondent)
Representation:	Counsel
J Moffett (Appellants) B Buckland (Respondents)
Solicitors
BAL Lawyers (Appellants) Johannessen Legal (Respondents)
File Number:	SCA 55 of 2024
McWILLIAM J:
1․	The parties in this proceeding are involved in an appeal from orders made in the
Magistrates Court on 10 October 2024 in relation to a liquidated debt claim of
approximately $85,000 inclusive of interest, arising out of a contractual building dispute:
Concrete Menders Pty Ltd v Ghiasvand; Ghiasvand v Flexible Constructions Pty Ltd
[2024] ACTMC 23.
2․	The appellants, Kobra and Ali Ghiasvand, are the owners of a residential property in
Taylor. The respondents are Flexible Constructions Pty Ltd, the builder with whom the
appellants originally contracted to undertake their residential construction project (the
third party in the court below), and Concrete Menders Pty Ltd, the company who did the
concreting (the plaintiff in the court below) and claimed the entitlement to be paid.
3․	The magistrate in the court below found the owners liable to pay the concreting company,
and dismissed the appellants’ claim that the builder was liable to the concreting
company. The appellant was ordered to pay the respondents’ costs.
4․	On 5 November 2024, the appellants applied for, and were granted, a stay of the orders
in the court below, on the condition of payment of security for costs, with the parties being
given the opportunity to agree, in the first instance, on the form and quantum of the
security to be paid.
5․	Brief oral reasons were given at the time, including the recording of the application of
principles that had been recently set out in Alananzeh v Zgool Form Pty Ltd (No 2) [2024]
ACTSC 258 at [6]-[9] and satisfaction that there was a serious question to be tried on
appeal, based on the arguments addressed by counsel for the appellant during the
hearing and that the balance of convenience favoured the appellant not being required
to pay the judgment sum while the appeal was pending, in circumstances where I was
satisfied there was a risk of non-recovery if the appeal were ultimately successful.
6․	The parties were subsequently unable to agree on the conditions of the stay. They
returned to court for determination of the remaining aspect of the application in
proceeding as to form and quantum of the security. This judgment deals with that
outstanding issue.
7․	At this stage of the application, the question informing the exercise of the discretion is
what constitutes fair terms as the price of the stay of the judgment obtained in the court
below: Kalifair Pty Ltd v Digi-tech (Australia) Pty Ltd; McLean Tecnic Pty Ltd v Digi-Tech
(Australia) Ltd [2002] NSWCA 383; 55 NSWLR 737 at [17].

Competing positions of the parties

8․ At the subsequent hearing, the respondents sought:

(a)	security for the judgment sum of approximately $85,000 inclusive of interest;
(b)	security for the costs of the hearing below, which the solicitor for the

respondents deposed to being in the order of approximately $240,000 on an

indemnity basis, and

(c) security for costs on appeal, which were estimated to be approximately $62,000

for a one-day appeal inclusive of counsel’s fees.

9․	The appellants sought an order that they pay into court the sum of $40,000 as security
for the current judgment amount (and have already paid such sum into court in
anticipation of such an order being made). That represents a little under half the
judgment sum obtained in the court below.
10․	Otherwise, they resisted the payment of any further sum by way of additional amounts
for security for costs, either at first instance or on appeal. They argued that the
application was one dealing with a stay of judgment. There was no application made by
the respondents for security for costs and the Court would not entertain such an
application indirectly.

The appropriate condition of the stay

11․	The Court is only determining the form and quantum of the condition of the stay of
judgment. I consider $40,000 is an appropriate sum and that it should be provided by
way of a payment into court. In my view, it represents a proportion of the judgment sum
that appropriately balances the competing considerations raised by the parties at the
hearing of the application on 5 November 2024.
12․	I acknowledge that such a sum plainly does not include the respondent’s costs of the
proceedings below. The evidence suggested that regrettably, they are entirely
disproportionate to the amount of the dispute. Such costs are also presently
unassessed, and I was informed there was an application for indemnity costs awaiting
judgment in the court below, such that a final costs order is in fact yet to be made. The
respondents sought an order for 50% of the sum deposed to, as that sum represented
what might be thought to be the minimum recoverable on a party-party basis. However,
this is not a mathematical exercise and having regard to the additional evidence that was
filed setting out the asset position of the appellants, I do not consider the particular
circumstances of either party warranted a sum greater than $40,000 being paid into court
as a condition of the stay.
13․	Given that conclusion, the question of whether the appellants are able to pay more or
whether there may have been an alternative whereby the appellants paid a greater sum
by way of a charge over a separate property (being one of the matters canvassed at the
hearing) falls away.

Should security for the costs of the appeal be ordered as part of the condition of the stay?

14․	As for whether the conditions of the stay of the orders in the court below should include
security for costs on the appeal, I am not persuaded that a court determining a stay
application should permit a party, over the objection of their opponent, to transform the
argument into a de facto security for costs application.
15․	Rule 5055 of the Court Procedures Rules 2006 (ACT)(Rules) provides that security for
costs of an appeal is not required, unless the Supreme Court otherwise orders. That
rule expressly does not limit applications for security dealt with under division 2.17.8 of
the Rules. I have recently discussed the exercise of the Court’s discretion to order
security for costs in CDLC Pty Ltd v Capital Estate [2024] ACTSC 345 at [12]-[13] and
[23]-[26]. The exercise of the Court’s discretion in relation to such an application is
similarly one of fairness, but the considerations are different, and the evidence may also
be different.
16․	In that regard, r 1900 of the Rules requires that an application for security for costs be
supported by an affidavit setting out the facts relied on and the grounds on which the
order is sought. That is important, because r 1901 creates a threshold for an application
for security for costs, which means that an applicant for costs must identify a ground for
enlivening the exercise of the court’s discretion.
17․	It is significant in this case that the appellants are individuals. Of the matters listed in r
1901 enlivening the exercise of the court’s discretion, the only one that seems to apply
to them is r 1901(h) of the Rules, namely, where the justice of the case “requires” the
order to be made.
18․	There were a number of affidavits in evidence which established that the appellants had
assets, and attempts were made to provide evidentiary support for the position that some
of the assets had a degree of equity in them, albeit that such equity may presently be
difficult to access. The evidence was not strong, but it was sufficient to provide a basis
to infer that the appellants are not presently impecunious, and in any event, mere
impecuniosity in respect of an individual would not be a sufficient basis of itself to
determine that security for costs ought to be paid: Lucas v Yorke (1984) 58 ALJR 20 at 21, particularly if an order would stifle the appeal: Benjamin v GB Franchising Pty
Ltd [2008] ACTCA 11; 1 ACTLR 287 at [31].
19․	Moreover, to the extent that the appellants are presently unable to deal with the property
in Taylor to access funds, it appears to be uncontroversial that that is because it is subject
to a caveat. The caveat was lodged by the second respondent in respect of a separate
but related dispute, which recently settled.
20․	All of this is said with a view to explaining that what constitutes “fairness” depends very
much on the application made, as that is what shapes the principles applying to the
exercise of the discretionary power. The parties here argued an application for a stay
and if granted, the nature of any conditions that should attach. They did not argue a
security for costs application. Accepting that some of the evidence on the stay
application may coincidentally address some of the issues that may have arisen on an
application for security for costs, the appellants did not file evidence dealing with the
different considerations nor did the parties make arguments that would have been
necessary to address on such an application. In those circumstances, it would be unfair
to make any order for security for costs of the appeal.

Orders

21․ For those reasons, the Court makes the following order:

(1)	The stay of the orders made on 10 October 2024 in the Magistrates Court
proceeding CS 60/2023 is conditional upon the payment into Court of the sum
of $40,000 by way of security for the judgment obtained in the court below,
pending resolution of the appeal.

THE COURT NOTES: The sum referred to in order 1 has already been paid into

Court on 26 November 2024.

I certify that the preceding twenty-one [21] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice McWilliam

Associate:

Date: