Hung v Aquamore Credit Equity Pty Ltd - [2022] NSWCA 123

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Hung v Aquamore Credit Equity Pty Ltd [2022] NSWCA 123
Hearing dates: 04 July 2022
Decision date: 04 July 2022
Before: Leeming JA
Decision:
Notice of motion filed 6 May 2022 dismissed with costs.

Catchwords:
APPEAL – procedure – security for costs – two natural person appellants and one corporate appellant – whether discretion to order security for costs differed between appellants – interests of natural person appellants identical with that of corporate appellant – absence of special circumstances – grossly inflated estimate of respondents’ costs – whether, if otherwise a proper case for security, inflated estimate should disentitle

Legislation Cited:
Civil Procedure Act 2005 (NSW), s 56
Corporations Act 2001 (Cth), ss 420A, 1335
UCPR rr 51.28, 51.29, 51.37, 51.50,

Cases Cited:
Aquamore Credit Equity Pty Ltd v Hung; First on First Development Pty Ltd v Aquamore Credit Equity Pty Ltd [2021] NSWSC 1681
Interwest Ltd v Tricontinental Corporation Limited (1991) 5 ACSR 621
Macedonian Orthodox Community Church St Petka Incorporated v Petar [2012] NSWCA 304
Nicholls v Michael Wilson & Partners Ltd [2010] NSWCA 100
Street v Luna Park Sydney Pty Ltd [2006] NSWSC 1317
Uptown Sydney Development Corporation Pty Ltd v Bank of New Zealand (No 1) (1993) 11 ACSR 300
Zhu v Wang [2021] NSWCA 109

Category: Procedural rulings
Parties: Edgar Yan Kai Hung (First Appellant; First Respondent to motion)
Trevor David Chappell (Second Appellant; Second respondent to motion)
First on First Development Pty Ltd (Third Appellant; Third Respondent to motion)
Aquamore Credit Equity Pty Ltd (First Respondent to appeal; First Applicant on motion)
Hsu Allen (Second Respondent to appeal; Second Applicant on motion)
Zachary Chang (Third Respondent to appeal; Third Applicant on motion)
Representation:
Counsel:
J Hogan-Doran SC; R Sud (Applicants on motion)
T D Tzovaras (solicitor) (Respondents on motion)
Solicitors:
Independent Legal Pty Ltd (Applicants on motion)
Tzovaras Legal (Australia) Pty Ltd (Respondents on motion)

File Number(s): 2022/00012119
Publication restriction: Nil
Decision under appeal

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Common Law

Citation:

[2021] NSWSC 1681

Date of Decision:

21 December 2021

Before:

Meagher JA

File Number(s):

2019/371915; 2020/341930

EX TEMPORE Judgment

LEEMING JA: Mr Edgar Yan Kai Hung, Mr Trevor David Chappell and First on First Development Pty Ltd appeal from a judgment following a three day hearing in the Common Law Division: Aquamore Credit Equity Pty Ltd v Hung; First on First Development Pty Ltd v Aquamore Credit Equity Pty Ltd [2021] NSWSC 1681. The respondents to the appeal, Aquamore Credit Equity Pty Ltd, as trustee for the Spring Park Unit Trust and Messrs Allen Hsu and Zachary Chang, by notice of motion filed 6 May 2022 amended on 3 June 2022, have sought security for the costs of the appeal.
The appeal arises out of the following facts which may briefly be stated. Aquamore advanced money to First on First on 7 December 2016. Its obligation to repay was secured by a mortgage over…

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: [2022] NSWCA 123
Decision Date: 04 July 2022

CaseChat Overview and Summary

The appeal concerned a notice of motion filed by the respondents seeking security for costs against the appellants, who were two natural persons and one corporate entity. The dispute arose in the context of an appeal, where the respondents argued that the appellants, particularly the corporate appellant, lacked sufficient financial resources to meet potential adverse costs orders. The matter was heard by Leeming JA in the Court of Appeal of New South Wales.

The primary legal issue before the Court was whether the discretion to order security for costs differed between the natural person appellants and the corporate appellant, given their identical interests in the appeal. A further issue was whether a grossly inflated estimate of the respondents' costs, if otherwise a proper case for security, should disentitle the respondents from obtaining an order for security.

Leeming JA reasoned that the interests of the natural person appellants were identical with those of the corporate appellant. In the absence of special circumstances, the Court's discretion to order security for costs should not differ between the appellants. His Honour found that the respondents' estimate of their costs was grossly inflated, and that this inflation was so significant as to disentitle the respondents from obtaining an order for security for costs, even if the circumstances otherwise warranted it.

Consequently, the notice of motion filed by the respondents on 6 May 2022 was dismissed with costs.

Orders

Orders of the court

Notice of motion filed 6 May 2022 dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Medium Neutral Citation:	Hung v Aquamore Credit Equity Pty Ltd [2022] NSWCA 123
Hearing dates:	04 July 2022
Decision date:	04 July 2022
Before:	Leeming JA
Decision:	Notice of motion filed 6 May 2022 dismissed with costs.
Catchwords:	APPEAL – procedure – security for costs – two natural person appellants and one corporate appellant – whether discretion to order security for costs differed between appellants – interests of natural person appellants identical with that of corporate appellant – absence of special circumstances – grossly inflated estimate of respondents’ costs – whether, if otherwise a proper case for security, inflated estimate should disentitle
Legislation Cited:	Civil Procedure Act 2005 (NSW), s 56 Corporations Act 2001 (Cth), ss 420A, 1335 UCPR rr 51.28, 51.29, 51.37, 51.50,
Cases Cited:	Aquamore Credit Equity Pty Ltd v Hung; First on First Development Pty Ltd v Aquamore Credit Equity Pty Ltd [2021] NSWSC 1681 Interwest Ltd v Tricontinental Corporation Limited (1991) 5 ACSR 621 Macedonian Orthodox Community Church St Petka Incorporated v Petar [2012] NSWCA 304 Nicholls v Michael Wilson & Partners Ltd [2010] NSWCA 100 Street v Luna Park Sydney Pty Ltd [2006] NSWSC 1317 Uptown Sydney Development Corporation Pty Ltd v Bank of New Zealand (No 1) (1993) 11 ACSR 300 Zhu v Wang [2021] NSWCA 109
Category:	Procedural rulings
Parties:	Edgar Yan Kai Hung (First Appellant; First Respondent to motion) Trevor David Chappell (Second Appellant; Second respondent to motion) First on First Development Pty Ltd (Third Appellant; Third Respondent to motion) Aquamore Credit Equity Pty Ltd (First Respondent to appeal; First Applicant on motion) Hsu Allen (Second Respondent to appeal; Second Applicant on motion) Zachary Chang (Third Respondent to appeal; Third Applicant on motion)
Representation:	Counsel: J Hogan-Doran SC; R Sud (Applicants on motion) T D Tzovaras (solicitor) (Respondents on motion) Solicitors: Independent Legal Pty Ltd (Applicants on motion) Tzovaras Legal (Australia) Pty Ltd (Respondents on motion)
File Number(s):	2022/00012119
Publication restriction:	Nil
Decision under appeal	Court or tribunal: Supreme Court of New South Wales Jurisdiction: Common Law Citation: [2021] NSWSC 1681 Date of Decision: 21 December 2021 Before: Meagher JA File Number(s): 2019/371915; 2020/341930