Leadenhall Australia Pty Ltd v Doman - [2018] SADC 43

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Appeal Against a Master's Decision)
LEADENHALL AUSTRALIA PTY LTD v DOMAN & ANOR
[2018] SADC 43
Judgment of His Honour Judge Dart
4 May 2018
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - SECURITY FOR COSTS
Master ordered appellant (plaintiff) to provide security for costs - second order in the action - appellant says the Master erred in the exercise of his discretion - review of Master's exercise of discretion - no error in the exercise of the Master's discretion has been established.
Held: Appeal dismissed.
Corporations Act 2001 s 1335; Legal Practitioners Act 1981 ; Supreme Court Civil Rules 2006 r 194, referred to.
Adelaide (SA Pools and Spa) Manufacturing and Installation Pty Ltd & Ors v Westcourt General Insurance Brokers Pty Ltd [2016] SASC 60; Leadenhall Australia Pty Ltd v Cape Lambert Resources Ltd [2018] FCA 558, considered.

LEADENHALL AUSTRALIA PTY LTD v DOMAN & ANOR
[2018] SADC 43
JUDGE DART:

This is an appeal from an order made by a Master of the Court. The Master ordered that the plaintiff (appellant) should provide security for costs in the amount of $65,000. In my opinion, for the reasons that follow, it is appropriate that the appeal should be dismissed.
Background
The plaintiff initially sued a range of defendants in these proceedings. There are now only two defendants (respondents). The dispute is in respect of whether, by reason of contractual arrangements between the plaintiff and defendants, the plaintiff is entitled to be paid a success fee in the amount of $795,318. The defendants deny the entitlement. The matter turns on a letter of engagement entered into between the parties in August 2014.
An order requiring the appellant to provide security for costs in the amount of $90,000 was made in 2016. At that time there were five defendants. The appellant no longer pursues a claim against three of the defendants. Those defendants may have an entitlement to costs that would potentially come out of the original sum paid into Court.
This appeal deals with a second order requiring the plaintiff to pay additional security for costs. The order was made on 28 September 2017. The two remaining defendants made an application for an additional amount of security. The application was based on an extensive interlocutory history. The interlocutory history shows that a number of failed applications means that there are now a number of costs orders against the plaintiff.
In their application seeking additional security for costs the defendants sought further security in the amount of $161,638. As mentioned above, the Master allowed $65,000. The plaintiff has paid that amount into the Suitors Fund.
The Master analysed the financial documents provided to the Court, including the balance sheet and a profit and loss statement. The Master was applying both Rule 194 and the provisions of s 1335 of the Corporations Act 2001. That provision provides an ability for the Court to order security for costs if it appears…

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: [2018] SADC 43
Decision Date: 4 May 2018

CaseChat Overview and Summary

Leadenhall Australia Pty Ltd sought a review of a decision by the Master of the Supreme Court of New South Wales, who had ordered the appellant, as the plaintiff, to provide security for costs. This was the second such order in the action. The appellant contested the Master's decision, asserting that it was erroneous. The court was required to determine whether the Master had made an error in exercising his discretion in ordering the security for costs.

The court examined the applicable legal principles regarding the exercise of discretion by a Master in ordering security for costs. The appellant argued that the Master had not correctly applied the relevant criteria or had made an error in his assessment. The court, however, found that the Master had properly considered the relevant factors and exercised his discretion in a manner consistent with the law. The appellant had not established any error in the Master's exercise of discretion.

Accordingly, the court upheld the Master's decision. The appellant's application for review was dismissed, and the order for security for costs remained in place. The court did not find any grounds to interfere with the Master's exercise of discretion, and the decision was affirmed.

Orders