IMM Direct Holdings Ltd v Woodley, John Staniforth Summary

IN THE FEDERAL COURT OF AUSTRALIA )

)No. NG 3064 of 1995

NEW SOUTH WALES DISTRICT REGISTRY )       NG 3065 of 1995
  )
GENERAL DIVISION                 )

BETWEEN:IMM DIRECT HOLDINGS LIMITED

Applicant

AND:JOHN STANIFORTH WOODLEY & ORS t/as WESTON WOODLEY & ROBERTSON (in the matter of IMM DIRECT HOLDINGS LTD ACN 002 578 449

Respondent

CORAM:WILCOX J

PLACE: SYDNEY
DATE: 31 OCTOBER 1995

EXTEMPORE REASONS FOR JUDGMENT

WILCOX J: The issues relevant to the exercise of the Court's discretion as to costs have been canvassed in discussion with counsel. I do not propose to set out any elaborate reasons. I am of the opinion that there ought to be an order for costs in each matter but I think that this order ought to be limited to costs incurred after 1 May 1995. I say that because the particulars of the cross-claim that were advanced in the affidavit of Mr Todd of 10 February 1995 were in some respects sparse and vague. It is true that some details of the claim were specific, but it is not clear to me to what extent these were of great significance. However, any deficiency that might have existed in there being a demonstration of a genuine
dispute was cured by the affidavit of 28 April 1995 which was filed on 1 May.

I do not accept the submission that it was not until the affidavit of 7 July that it became apparent that there was a genuine dispute. It is true that Mr Todd referred to some further evidentiary material in that affidavit, but by that time it was manifestly clear that there was a genuine dispute. I, of course, say nothing as to whether or not the matters raised on behalf of the respondent companies by way of cross-claim are well based; that is not a matter that has been investigated in this proceeding. But it is apparent to me that by 1 May any objective reader of the file would have come to the conclusion that there was a genuine dispute as to whether there was a debt owed by the present applicant companies which exceeded the amount owing on any cross‑claim. Nothing significant happened between 1 May and the present time and it is conceded today, by the respondents' consent to the Court setting aside the statutory demands, that there is today a genuine question as to the existence of the appropriate debt.

The order that I make in each matter is as follows. By consent I set aside the statutory demand, and, on the application of the applicant in each case, I make an order that the respondents pay the applicant's costs of the proceeding; but I order that such costs be limited to those incurred after 1 May 1995.

I certify that this and the preceding one (1) pages
are a true copy of the Reasons for Judgment
of the Honourable Justice Wilcox.

Associate:

Dated:31 October 1995

APPEARANCES

Counsel for the Applicant: J Nichols

Solicitors for the Applicant: Cowley Hearne

Counsel for the Respondent: R E Dubler

Solicitors for the Respondent: Esplins?

Dates of hearing: 31 October 1995

CaseChat Overview and Summary

The matter before the Federal Court of Australia was between IMM Direct Holdings Limited, the applicant, and John Staniforth Woodley and others trading as Weston Woodley & Robertson, the respondents. The dispute involved the assessment of costs in proceedings related to statutory demands and the determination of whether a genuine dispute existed concerning the existence of a debt owed by IMM Direct Holdings. The case was heard in the New South Wales District Registry of the General Division of the Federal Court.

The court was required to decide whether the respondents were entitled to costs incurred after a certain date, specifically 1 May 1995, in light of the evolving clarity of the genuineness of the dispute. The issue was whether the respondents had demonstrated a genuine dispute in their cross-claim, which was initially sparse and vague, and whether this demonstration was sufficient to warrant an award of costs from the applicant.

Justice Wilcox held that there was a genuine dispute by 1 May 1995, as evidenced by the affidavit filed on that date. The court rejected the argument that the genuineness of the dispute was not apparent until a later affidavit. The court found that by 1 May 1995, any objective reader would have concluded that there was a genuine dispute as to the existence of the debt. Consequently, the court ordered that the respondents pay the applicant's costs incurred after 1 May 1995, and set aside the statutory demands by consent. The reasoning focused on the progression of the clarity of the dispute and the timing of the affidavits filed by the parties.

The final orders of the court were that the respondents were to pay the applicant's costs incurred after 1 May 1995, and that the statutory demands were set aside by consent.

IMM Direct Holdings Ltd v Woodley, John Staniforth

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established