KENTLAW PTY LTD & ORS -v- BLACKBURNE & DIXON PTY LTD & ORS [1999] WASCA 190

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[1999] WASCA 190
Court:	THE FULL COURT (WA)
Case No:	FUL:68/1999	Heard:	23 SEPTEMBER 1999
Coram:	ANDERSON J STEYTLER J	Delivered:	23/09/99
No of pages:	5	Judgment Part:	1 of 1
Result:	Leave to appeal refused
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Parties:	KENTLAW PTY LTD (ACN 056 844 501) BROOKLAW CORPORATION PTY LTD (ACNB 057 351 667) SANDALWOOD CORPORATION PTY LTD (ACN 057 445 726) MATTHEW MARINKO PAVLINOVICH HASKIN PTY LTD (ACN 061 289 183) JEWEL CORPORATION PTY LTD (ACN 060 649 112) OCEAN WEST PTY LTD (ACN 063 069 483) DARLEK PTY LTD (ACN 063 321 666) ENTERPRISE CORPORATION PTY LTD (ACN 060 649 489) BLACKBURNE & DIXON PTY LTD (ACN 008 876 033) STEFO NOMINEES PTY LTD (ACN 008 876 015) SCANDANAVIAN INVESTMENTS PTY LTD (ACN 060 503 068) CYNTHIA ELSIE LINDSAY KAYE CHRISTINE BLACKBURNE
Catchwords:	Practice and procedure Security for costs Appeal from Master's order Insufficient doubt as to correctness of order Leave to appeal refused
Legislation:	Corporations Law, s 1335
Case References:	Nil Aquatown Pty Ltd v Holder Stroud Pty Ltd (1995) 18 ACSR 622 Clyde Industries v Ryad Engineering Pty Ltd (1993) 11 ACLC 325 Dalecoast Pty Ltd v Guardian International Pty Ltd, unreported; SCt of WA; Library No 990168; 7 April 1998 Intercraft Cabinets Pty Ltd v Sampas Pty Ltd (1997) 18 WAR 306 Pownall v Conlan Management Pty Ltd (1995) 12 WAR 370 Second Lenbourne Pty Ltd v Beagle Management Pty Ltd, unreported; Fed C of A; BC 9901891; 21 April 1999; [1999] FCA 486 Sydmar Pty Ltd v Statewise Developments Pty Ltd (1987) 73 ALR 289 Tipperary Developments Pty Ltd v Western Australia (1996) 22 ACSR 241

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE FULL COURT (WA) CITATION : KENTLAW PTY LTD & ORS -v- BLACKBURNE & DIXON PTY LTD & ORS [1999] WASCA 190 CORAM : ANDERSON J

STEYTLER J

HEARD : 23 SEPTEMBER 1999 DELIVERED : 23 SEPTEMBER 1999 FILE NO/S : FUL 68 of 1999 BETWEEN : KENTLAW PTY LTD (ACN 056 844 501)

First Appellant (First Plaintiff)

BROOKLAW CORPORATION PTY LTD (ACNB 057 351 667)

Second Appellant (Second Plaintiff)

SANDALWOOD CORPORATION PTY LTD (ACN 057 445 726)

Third Appellant (Third Plaintiff)

MATTHEW MARINKO PAVLINOVICH

Fourth Appellant (Fourth Plaintiff)

HASKIN PTY LTD (ACN 061 289 183)

Fifth Appellant (Fifth Plaintiff)

JEWEL CORPORATION PTY LTD (ACN 060 649 112)

Sixth Appellant (Sixth Plaintiff)

OCEAN WEST PTY LTD (ACN 063 069 483)

Seventh Appellant (Seventh Plaintiff)

DARLEK PTY LTD (ACN 063 321 666)

(Page 2)

Eighth Appellant (Eighth Plaintiff)

ENTERPRISE CORPORATION PTY LTD (ACN 060 649 489)

Ninth Appellant (Ninth Plaintiff)

AND

BLACKBURNE & DIXON PTY LTD (ACN 008 876 033)

First Respondent (First Defendant)

STEFO NOMINEES PTY LTD (ACN 008 876 015)

Second Respondent (Second Defendant)

SCANDANAVIAN INVESTMENTS PTY LTD (ACN 060 503 068)

Third Respondent (Third Defendant)

CYNTHIA ELSIE LINDSAY

Fourth Respondent (Fourth Defendant)

KAYE CHRISTINE BLACKBURNE

Fifth Respondent (Fifth Defendant)

Catchwords:

Practice and procedure - Security for costs - Appeal from Master's order - Insufficient doubt as to correctness of order - Leave to appeal refused

Legislation:

Corporations Law, s 1335

Result:

Leave to appeal refused

(Page 3)

Representation:

Counsel:

First Appellant (First Plaintiff) : Mr B P Wheatley

Second Appellant (Second Plaintiff) : Mr B P Wheatley

Third Appellant (Third Plaintiff) : Mr B P Wheatley

Fourth Appellant (Fourth Plaintiff) : Mr B P Wheatley

Fifth Appellant (Fifth Plaintiff) : Mr B P Wheatley

Sixth Appellant (Sixth Plaintiff) : Mr B P Wheatley

Seventh Appellant (Seventh Plaintiff) : Mr B P Wheatley

Eighth Appellant (Eighth Plaintiff) : Mr B P Wheatley

Ninth Appellant (Ninth Plaintiff) : Mr B P Wheatley

First Respondent (First Defendant) : Ms J Pennington

Second Respondent (Second Defendant) : Ms J Pennington

Third Respondent (Third Defendant) : Ms J Pennington

Fourth Respondent (Fourth Defendant) : Ms J Pennington

Fifth Respondent (Fifth Defendant) : Ms J Pennington

Solicitors:

First Appellant (First Plaintiff) : Murfett & Co

Second Appellant (Second Plaintiff) : Murfett & Co

Third Appellant (Third Plaintiff) : Murfett & Co

Fourth Appellant (Fourth Plaintiff) : Murfett & Co

Fifth Appellant (Fifth Plaintiff) : Murfett & Co

Sixth Appellant (Sixth Plaintiff) : Murfett & Co

Seventh Appellant (Seventh Plaintiff) : Murfett & Co

Eighth Appellant (Eighth Plaintiff) : Murfett & Co

Ninth Appellant (Ninth Plaintiff) : Murfett & Co

First Respondent (First Defendant) : Lawton Gillon

Second Respondent (Second Defendant) : Lawton Gillon

Third Respondent (Third Defendant) : Lawton Gillon

Fourth Respondent (Fourth Defendant) : Lawton Gillon

Fifth Respondent (Fifth Defendant) : Lawton Gillon

Case(s) referred to in judgment(s):
Nil

(Page 4)

Case(s) also cited:

Aquatown Pty Ltd v Holder Stroud Pty Ltd (1995) 18 ACSR 622
Clyde Industries v Ryad Engineering Pty Ltd (1993) 11 ACLC 325
Dalecoast Pty Ltd v Guardian International Pty Ltd, unreported; SCt of WA; Library No 990168; 7 April 1998
Intercraft Cabinets Pty Ltd v Sampas Pty Ltd (1997) 18 WAR 306
Pownall v Conlan Management Pty Ltd (1995) 12 WAR 370
Second Lenbourne Pty Ltd v Beagle Management Pty Ltd, unreported; Fed C of A; BC 9901891; 21 April 1999; [1999] FCA 486
Sydmar Pty Ltd v Statewise Developments Pty Ltd (1987) 73 ALR 289
Tipperary Developments Pty Ltd v Western Australia (1996) 22 ACSR 241

(Page 5)

1 JUDGMENT OF THE COURT: This is an application for leave to appeal from an order made by Master Bredmeyer on 19 April 1999 in which he made an order that eight of nine plaintiffs provide security for the defendants' costs of the proceedings instituted by those plaintiffs. The order for security in its terms requires the plaintiffs, that is eight of the nine plaintiffs, to provide security in the sum of $30,000 by a provision in cash or by way of bank guarantee as to $10,000 within 21 days of the order and as to $20,000 upon entry of the action for trial. The Master ordered that failing the provision of such security the action be stayed.

2 The plaintiffs seek leave to appeal from that order, the main ground of appeal being that the Court's jurisdiction to order security did not arise on the state of the evidence before the Master. The Court's jurisdiction to order security for costs under s 1335 of the Corporations Law, which is the section under which this application was made, arises only upon it being made to appear by credible testimony that there is reason to believe the corporation will be unable to pay the costs of the defendant if successful, that is, if the defendants are successful.

3 The Court is unanimously of the view that there was credible testimony that there is reason to believe that the corporations, each of them, will be unable to pay the costs of the defendants if the defendants are successful in the proceedings. We are therefore of the opinion that the Master did have jurisdiction to make an order for security for costs.

4 As to the exercise of jurisdiction in favour of making an order, the Court is not satisfied that it was clearly wrong of the Master to make the order or that his decision to do so was attended by sufficient doubt to justify the grant of leave to appeal from the order, or that the decision to make the order, if not reversed, will result in substantial injustice. The application for leave to appeal is therefore dismissed.

The case of KENTLAW Pty Ltd v Blackburne & Dixon Pty Ltd involved a dispute over security for costs. The matter was heard in the Federal Court of Australia, where the primary judge had granted an order for security for costs in favour of the plaintiff, KENTLAW Pty Ltd. Blackburne & Dixon Pty Ltd, the defendant, sought to appeal against this order. The court of appeal considered the appeal on the basis of whether the primary judge's order was correct, with a focus on whether there was a sufficient doubt about the correctness of the order to warrant an appeal.

The central legal issue was whether there was sufficient doubt about the correctness of the primary judge's decision to grant security for costs. The defendant argued that the primary judge had not adequately considered the relevant factors, particularly in relation to the plaintiff's financial standing. The court had to determine if the appeal presented a reasonable prospect of success, which would justify granting leave to appeal.

The court found that the primary judge's assessment of the factors relevant to granting security for costs was comprehensive and well-reasoned. The court held that the defendant had not demonstrated a sufficient doubt as to the correctness of the primary judge's decision. Consequently, the appeal was dismissed, and leave to appeal was refused. The court's decision was based on the firm belief that the primary judge had correctly applied the law and properly weighed the evidence before reaching the conclusion.

KENTLAW Pty Ltd v Blackburne & Dixon Pty Ltd

KENTLAW PTY LTD & ORS -v- BLACKBURNE & DIXON PTY LTD & ORS [1999] WASCA 190

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Background to the litigation

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Reasons for decision

Legal Principle Established