Greig v Octaviar Limited (Receivers and Managers Appointed) (In liquidation)

The applicants, appointed as deed administrators of the respondent companies, provisional liquidators of the first respondent, and liquidators of the second respondent, sought costs on an indemnity basis in relation to their application for remuneration. The applicants had reached agreements on their remuneration with the present liquidators of the respondents but sought an order for their costs on an indemnity basis. The primary issue before the court was whether the applicants should be entitled to have their costs in respect of the application for remuneration paid on an indemnity basis. The court considered the principle that costs should follow the event and the precedents that supported ordering costs on an indemnity basis in certain circumstances.

The court found that the principle of costs following the event was a general rule but not an inflexible one. The court noted that in certain circumstances, particularly when the applicant had acted in good faith and there was no fault on their part, it was appropriate to order costs on an indemnity basis. The court considered that the applicants had acted in good faith and without fault in their application for remuneration, and the circumstances warranted departing from the general rule. The court also considered the precedents that supported ordering costs on an indemnity basis in cases where the applicant had acted without fault and in the best interests of the estate. The court concluded that the applicants were entitled to have their costs in respect of the application for remuneration paid on an indemnity basis.

The court ordered that the applicants' costs of the proceeding be assessed upon an indemnity basis and be paid as follows: two-thirds of the costs were to be paid out of the assets of the second respondent, and one-third was to be paid out of the assets of the first respondent by the same means as envisaged by the order for the applicants' remuneration relating to the first respondent. The court also made orders regarding the payment of the applicants' remuneration in respect of their appointments as deed administrators and liquidators of the respondents.

The court noted that the liquidators of the second respondent would determine the respective entitlements of the respondents to the funds held by the applicants and by another party, Blake Dawson, and inform the applicants of their determination within five days of making the determination. The court adjourned the application to a date to be fixed.