Hunt v Farnell
[1992] TASSC 104
•23 June 1992
COURT: SUPREME COURT OF TASMANIA
CITATION: Hunt & Ors v Farnell [1992] TASSC 104; B26/1992
PARTIES: HUNT, Irene Lillian
JOHNSTONE, Suzanne Maree
ROBINSON, Sally Ruth
BAILEY, Pauline Mary
v
FARNELL, Gerald Ralph
FARNELL, Peter Gerald
FARNELL, Perry Michael
FILE NO/S: M35/1992
DELIVERED ON: 23 June 1992
JUDGMENT OF: Zeeman J
Judgment Number: B26/1992
Number of paragraphs: 7
Serial No B26/1992
List "B"
File No M35/1992
IRENE LILIAN HUNT, SUZANNE MAREE JOHNSTONE, SALLY RUTH ROBINSON & PAULINE MARY BAILEY v. GERALD RALPH FARNELL, PETER GERALD FARNELL & PERRY MICHAEL FARNELL
REASONS FOR JUDGMENT ZEEMAN J
23 June 1992
Costs – Security for costs – Order sought against applicants under Testator's Family Maintenance Act 1912 – No sufficient reason for the making of an order.
Myra June Farnell ("the deceased") died on 23 August 1991 leaving surviving her her husband Gerald Ralph Farnell and the issue of her marriage to him, namely Peter Gerald Farnell, Perry Michael Farnell and Judi Angela Farnell, and the issue of her earlier marriage, namely Irene Lilian Hunt, Suzanne Maree Johnstone, Sally Ruth Robinson and Pauline Mary Bailey. Probate of the will of the deceased was granted to the respondents, the executors named therein, on 7 January 1992. By that will, small bequests were made to each of the applicants and to Judi Angela Farnell, and the residue of the estate was left to the respondents. The applicants have sought orders that further provision be made for them out of the estate pursuant to the provisions of the Testator's Family Maintenance Act 1912. The estate is modest in size.
The respondents now seek an order that the applicants pay into court the sum of $5,000.00 as security for the costs of the respondents.
Counsel for the respondents submitted that the provisions of the Rules of the Supreme Court, O 80, Div.II, do not limit the circumstances in which security may be ordered. He cited no direct authority for that proposition, although there is ample authority indicative of that being the position. I do no more than refer to Rajski v. Computer Manufacture & Design Pty Ltd [1982] 2 N.S.W.L.R. 443, Stanley–Hill v Kool [1982] 1 NSWLR 460 and August Investments Pty Ltd v Poseidon Ltd (1971) 2 SASR 60.
Nevertheless, counsel did refer to a number of cases which he said indicated by reason of the wide variety of circumstances in which orders for security had been made that there exists such a wide discretion. I was unable to explore that proposition during argument, as counsel did not attend armed with any of the authorities, but confined himself to referring to notes of relevant cases appearing in the Australian Digest. I would have thought that it was axiomatic that where counsel seeks to argue a proposition of law by reference to authority that he be in a position to refer to that authority by reference to the relevant report. Accordingly, it was left to me after judgment had been reserved, to read the relevant cases. Campbell v Elphinstone (1930) 47 WN(NSW) 56 was a decision of the Prothonotary and proceeded upon the basis that the plaintiff was a nominal plaintiff only with no personal interest in the action. That is a well established category of plaintiff who may be ordered to provide security and the decision is not indicative of the suggestion that there is a general discretion. Macaulay v Macaulay (1895) 21 VLR 224 is an example of the same type of case. In Weger v Boola Petroleum & Natural Gas Co NL [1923] VLR 570 the plaintiff was an insolvent, conducting litigation in a vexatious manner indicating a want of bona fides. In those circumstances security was ordered to be given. The case fell into a category of case which, according to the practice in England, was one where security could be ordered (see Usil v Brearley (1878) 3 CPD 206 and Waddell v Blockey (1878) 10 Ch D 416). The judgment in that case gives no indication of the existence of a wide unfettered discretion, nor does the reported argument suggest that counsel argued the case upon that basis. The final case referred to was Smith v M'Carthy (1885) 7 ALT 54. In that case the relief sought by the plaintiff was substantially the same as the relief sought by him unsuccessfully in a previous action against the defendant where he had been ordered to pay the defendant's costs and those costs had not been paid. That case fell into a category where according to the English practice the second action might be stayed until the costs of the first action were paid (see In Re Payne; Randle v Payne (1883) 23 Ch D 288, Martin v Earl Beauchamp (1883) 25 Ch D 12 and Tichborne v Mostyn (1872) LR 8 CP 29). None of the cases cited suggest a discretion to order security in cases falling outside long accepted categories.
However, I do not need to finally determine the extent of the jurisdiction of this court to order security for costs. I have some difficulty in understanding the basis upon which the application is made. The submissions made by counsel for the respondents did not go beyond submitting that I had jurisdiction to make the order sought. The submissions did not condescend to any detail as to the basis upon which it might be said to be appropriate that I exercise my discretion in favour of making the order. An affidavit of the first named defendant was read but not further referred to. I can only assume that the basis upon which I am being asked to exercise my discretion is to be found in that affidavit, although counsel did not direct my attention to any particular material therein which might suggest that there ought to be a positive exercise of my discretion. That affidavit does no more than indicate that the respondents are in some financial difficulty. That in itself cannot constitute a sufficient basis for ordering that security for costs be provided. There is nothing in the affidavit to suggest –
(a) that the applicants' claim is other than a perfectly bona fide claim;
(b) that the applicants have done anything other than prosecute their claim in a proper manner;
(c)that the applicants, if ordered to pay costs, would not be in a position to satisfy such an order (in so far as any such material might be said to be contained in any affidavit filed by any of the applicants in support of their application for further provision that material was not relied upon by the respondents in support of their application that security be provided).
Ultimately it could not be said that the application relies on anything other than the basis deposed to in Mr GR Farnell's affidavit where by par25 he deposed to verily believing "that the estate does not have sufficient assets to pay for the costs of this application". That statement is patently incorrect. The net value of the estate sworn to for probate purposes was in excess of $45,000.00. The real position is that a realization of the assets in the estate might effectively put an end to the businesses in which those assets are employed. That may well be a matter of some hardship, but does not mean that there are insufficient assets to pay the costs. In effect the respondents claim that they need to have recourse to the estate so that they might employ it in the businesses formerly conducted by the respondent Gerald Ralph Farnell and the deceased in partnership and now carried on by the former on his own account. The major asset in the estate (and depending on the view taken of the value of interests in the partnerships it may be the only asset) is a one–half interest in land upon which the businesses are conducted. The accounts exhibited to the affidavit suggest that no rent has been charged, at least during the last two financial years. The respondents have confused their roles as executors with that as beneficiaries.
In my view this application is entirely misconceived and it will be dismissed.
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