In the matter of Eastmark Holdings Pty Limited (receivers and managers appointed) and 1 Denison Street Holdings Pty Ltd (receivers and managers appointed; In the matter of Eastmark Holdings Pty Limited (receivers..

The court was asked to decide whether Eastmark Holdings Pty Limited and 1 Denison Street Holdings Pty Ltd, as plaintiffs, should be required to provide security for costs in a proceeding against a defendant. The plaintiffs, as corporations, faced potential inability to pay costs, and any recourse by way of indemnity to a trust fund would not negate the need for security for costs. The defendants argued that the plaintiffs would be under a duty to levy on each owner to contribute to an administrative fund if costs were incurred. The court had to determine if the plaintiffs' inability to pay costs and the nature of the potential indemnity rendered them reasonably likely to be unable to pay costs. The reasoning of the court focused on the likelihood of the plaintiffs' inability to pay and the effectiveness of the proposed indemnity. The court concluded that the plaintiffs' potential recourse by way of indemnity was not sufficient to negate the need for security for costs, as the defendants would not be able to enforce the indemnity without the cooperation of the plaintiffs. The court held that an order for security for costs should be made. The final orders of the court included the requirement for the plaintiffs to provide security for costs in the proceeding.