Lifeplan Australia Friendly Society Ltd v Ancient Order of Foresters in Victoria Friendly Society Ltd (No 2)

Lifeplan Australia Friendly Society Ltd, the appellant, brought proceedings against the Ancient Order of Foresters in Victoria Friendly Society Ltd, the respondent, in the Federal Court of Australia. The dispute centred around a claim for profits made by the respondent in relation to the sale of insurance policies, which the appellant argued should have been paid to them under a previous agreement. The case was initially heard by Besanko J, who made certain orders, including a declaration that certain conduct by the respondent was unconscionable. The respondent appealed these orders.

The court was required to determine whether the orders made by Besanko J were appropriate, particularly in relation to the declarations and costs. The court considered the appropriate use of its power to make declarations and whether such declarations were necessary in this case. Additionally, the court had to assess the appropriateness of the costs orders made by Besanko J.

In allowing the appeal, the court found that the declarations made by Besanko J were not necessary and should not have been made. The court emphasised the importance of exercising its discretion to make declarations carefully and only when it serves the interests of justice. The court also found that the costs orders made by Besanko J were not appropriate and should be varied. The court ordered that the respondent account for profits to the appellants and pay interest, and set aside the original costs orders, replacing them with new orders for costs on a party and party basis.

The final orders included allowing the appeal, requiring the respondent to account to the appellants for profits, pay interest, and pay costs on a party and party basis. The court’s decision underscores the importance of carefully considering the use of declarations and the appropriate allocation of costs in complex commercial litigation.