C A T C H W O R D S
COSTS - application for security - undertaking of trustees not
Co exercise right of indemnity to recover costs a w a r d 4
against them - one applicant a natural pprson -- whether order
| for fiecuri | ty must hp mad- aqainsL a1 l appliranLs. |
| Lindsav Claude ~ l f o ~ d | & . Ors. |
v. U t r e 10 (Old.) Limited
| No. QG 76 of | 1 9 9 1 |
| - | PINCUS J. |
| BRISBANE |
| 14 NOVEMDER | 1 9 9 1 |
| I N T H E FEDERAL COURT O F AUSTRAL1.A | ) | No. QG 7 6 of 1 9 9 1 |
| QUEENSLAND | D I S T R I C T | REGISTRY | 1 |
| GEENNEEr!A4D1-KJrS_IO.N | ) |
BETWEEN : LIN-DS-AY CLAUDE AL-F9BP
First Applicant
| - | PROPERTY PROMOTION AND DEVELOPMEW |
| S-ERXI$ | E S x Y . . J L ' D | -,-- | ACN-0-10-5 | |
| - |
Second Applicant
| RABSOUARE P T Y . | L T D . | ACN 010 348 9 2 8 |
Third Appl icant
| - | FERNCAPE P T U T D . ACN 010 7 9 7 609 |
Fourth Applicant
| AND: | E | - | 1 0 I OLD. ) | L I M S W |
Respondent:
MINUTES O F ORDER
| JUDGE MAKING ORDER: | PTNCIJS J . |
| DATE O F ORDER: | |
| - |
| WHERE | MA-: | B R I S B A N E |
| ----.--p-.- | THE COURT ORDERS THAT: |
1 . On the basis of the statement by Mr. Sheahan that an
| appropriat-o undsrtaking wil l he ii led, the | |
appJiratinn for securit:y for post-s bs refusvd.
2. Costs of today be rosts in the proceedings, except
| insofar as | t h o s ~ | costs relate to the appljcation for | |
| |
3 . A s to the costs in relation to the applicatjon for
| sernrity for costs, t h o s ~ | costs hp the seconrl and | |
fourth respondents' costs in the proce~rliiigs.
4. The application for directions he adjourned to
| Monday 9 Dccpmb~r | 1 9 9 1 a t 9 . 4 5 | a.m. | |
| NOTE ? | Settlement and ent.ry of orders is (.lea1 | t | w i t-h in |
| Ordsr 36 nf Lli- Federal Col~rt | R~~les. |
| I N THE | FEDERALCOURT OF AUSTRALIA | 1 | N o . | QG 76 o f 1 9 9 1 |
QUEWLAND DISTRICT REGIISJPR.Y
| -- | 1 |
| F i - r s t Appl i c a n t |
PROPERTY PROMOTION AND DEVELOPMENT SERVJCS
| -. - | PTY. L'I'D. ACN 01-0-594975. |
| S e c o n d | Appl i c a n t |
RABSQUARE PTY. LTD. ACN 010 348 928
Thi r d Appl i c a n t
| FERNCAPE-PTY. | LTD. AC-No10 797 609 |
| -. |
| Fo1irt.h | A p p l i c a n t |
| AND: | E T R E 1 0 mL.u.1 | LIMITED |
R e s p o n d e n t
C O : PINCIJS J .
EX TEMPORE REASONS FOR JUDGMENT
| T h i s | i s a n a p p 1 i r : a t i o n | f o r s e c u r i t y f o r costs made |
| b y | t h e r e s p o n d e n t | i n | t h e p r i n c i - p a l p r o c e e d i . n g s , | Mitre | 1 0 |
| ( Q l d . ) L i m i t e d . | T h e | p a r t i e s w i l l be | g i v e n | t h e d e s i g n a t i o n s |
| t h e y | h e a r | i n t -hose | p r o c e e d i - n g s . |
| The | r e s p n n d e n t | a p p l i e s r a t h e r | l a t e , | b u t | s e e k s | t o |
| h a v e | s e c u r i t y f o r costs | i n < - u r r e d on1 y | f r o m | t h e p r e s e n t | t i m e |
| o n . | T h e | a c t - i o n was | b e g u n | ahout. | f i v e m o n t h s | a g o . | It. | r e l a t e s |
| t o a l l e g e d l y u n l a w f u l | r o n d u c t | o n | t h e p a r t | o f | t h e r - s p o n d e n t , |
| c a l l s i n g | c o m p a n i e s | c o n t r o l l e d | hy | t h s | f i rqt | a p p l i c a n t | t r , | b ~ r o m o |
involved in a certain enterprise. Some discussion took place
| at the hearing as to t h ~ | details of that rondurt and T have |
read the pleading, hut it seems to mc unnecessary to set the
particulars nut here.
The respondent has cross-clajmed agajnst the first
applicant for money due under a guarantee. If the applicants
| aucc~ed | completely, the guarantee will presumably he held |
ineffective and the respondent may, in addition, be held
liable in damages.
Of the four original applicants, one has
disrontjnued recently but., to my mind, nothing t-urns on that.
The other corporate applicants are apporent1.y control led by
| the first applfrant | It is unknown whether the first |
applicant has any signf f icant funds. The remaining corporate applicants carry on bvsiness as trustees and the trust assets were, according to the material, quite substantial as at 30
Jilne 1991.
| Ilowever, Mr Bajn, for the respondent, points o~lt |
that unless restrained, the applicant trusteps mjght take
steps to remove assets from any danger of being taken to
satisfy an order for costs in this suit. Other events also
might deprive the respondent of the opport-unity of getting at
the trust assets, such RR loss of those assets in some other
| v-nt-ure. Further events which hove occl~rred | since t-he end of |
June might significantly have altered the posi-tion of thc more
| sr~bstantial trust, which is t h ~ | Fprncapp Trust, of which tho |
| f o u r t h a p p l i c a n t | i s | t r u s t e e : | h u t | on | t h e | f a c e o f | i t , | t h e |
| respondent . | j s | n o t | i n a | p a r t i c u l a r l y p e r i l o u s | p o s i t i o n | a s |
| r ~ g a r d s | e n f o r c e m e n t | o f | a n | o r d e r | f o r c o s t s . | Tf | t h e | t - r u s t e e s |
| w i l l n o t | e x e r c i - s e t l l e i r | r i g h t | o f | i n d e m n i t y | t o r e c o v e r | c o s t s |
| awarded | a q a i n s t them, | t h e | r e s p o n d e n t | w i l l b e e n t i t l e d , | a s a |
| c r e d i t o r , | t o d o | s o : | I n R e | J o h n s m | ( 1 8 8 0 ) | 15 C t 1 . D . | 518 . |
| Ano the r | c o n s i d e r a t i o n | which | t e l l s a g a i n s t | t h e g r a n t |
| o f | a n o r d e r | f o r s e c u r i t y | i s | t h a t | t h e | f i r s t a p p l - i c a n t is | a |
| n a t u r a l | p e r s o n . | I n | P e a r s o n | v . | N a v d l e r | [ l 9 7 7 1 | 1 W . L . R . | 899 | is |
| t o h e | found | a u t h o r i t y a g a i n s t | e x t e n d i n g , | t o a p p l i c a t i o n s | f o r |
| s e c u r i t y a g a i n s t | a | p l a i n t i f f | company, | t h e p r i n c i - p l e which | had |
| been worked o u t i n r ~ l a t i o n | t o a p p l i c a t i o n s | aga ins t . | p l a i n t i f f s |
| r e s i d e n t | o u t of | t.ho | j i l r i s d i c t j o n . | Megarry | V . C . | p o i n t e d | o u t |
| t h a t where | o n e | p1 a i n t i f f | is | r e s i d e n t | a b r o a d | and | a n o t h e r w i t h i n |
| t h e | j u r i s d i r t i - o n , | t h e p l a i n t i f f | o u t s i d e t h e | j u r i s d i c t i o n | wi l1 |
| n o t b e o r d e r e d | t o g i v e s e c u r i t y f o r c o s t s : | [ l 9 7 7 1 | l | W.L.R. | 899 |
| at. | 902 and 903; | b u t t h e r e was, | I | th i -nk , a d i s t i n c t r e f u s a l | t o |
| e x t e n d | t h e r u l e t o c a s e s o f | t h e p r e s e n t | s o r t . |
| A | judgment | o f | C o n n o l l y LT. | i.n | HarDur v. | A r i d n - e |
| A u s t r a l i a L i m i t e d | [ l 9 8 4 1 | 2 Qd.R. | 523 made | t h a t | e x t e n s i o n | and |
| a p p l i e d | t h e p r i n c i p l e | d e r i v e d | from S y k e s | v . | .Sy-kIres ( 1 8 6 9 ) | I..R. |
| 4 | C .P . | 645 a t 650 t h a t " u n l e s s t h e w i s ground | for making a n |
| o r d e r | f o r s e c u r i t y a g a i n s t | a l l t h e p l a i n t i f f s , | i t | c a n n o t | h e |
| made | a g a i n s t | a n y " . | T | r e s p e c t f u l l y | doi lbt | t h e u n i v e r s a l | t r u t h |
| o f | t h a t s t a t e m e n t . | I n my | o p i n i o n , | t-he b e t t - e r V ~ R W | may b e t.hat |
| t h e p r e s e n c e o f | a | n n t a r a l | p e r s o n | among | t h e a p p l i c a n t s o r |
| p l a i - n t i f f s i s a | c j r c u m s t a n c e whic-h, | i f | t:hat | ppr.;on | i s r e s i d e n t |
| w i t h i n | t h e | j u r i s d i c t i o n , | shorl ld | i n c l i r r e o n e | a g a i n s t making | an |
| o r d e r | f o r | s e c u r i t y a g a i n s t | o t h e r | a p p l i c a n t s | o r p l a i n t i f f s ; | i t |
| i s n o t | d e c i s i v e . | H e r e , | i t d o e s | n o t | a p p e a r t o m e t h a t | t h e |
| r e s p o n d e n t | s h o u l d | n e c e s s a r i l y b e | h e l d | o a t | of | s e c u r i t y b e c a u s e |
| o f | t h e p r e s e n c e | of | t h e | f j r s t p l a i n t i f f , | a | n a t r i r a l | p e r s o n . |
| T h e r e | i ~ | n o t | a | c o m p l e t e | o v e r l a p o f | i n t e r e s t s , | by | any |
| mpans. | The | p r i n c i - p a l | i n t ~ r e s t | o f | t h e | n a t u r a l | p e r s o n | a p p l i c a n t |
| i s t o h a r e l i e v e d o f | t | h | bu rden | ~ | o f | a | g u a r a n t e e , | a m a t t e r whi-ch |
| d o e s | n o t | c o n c e r n | t h e o t h e r a p p l j c a n t s . | I t is p o s s i b l e , | as | M r |
| Ba in | p o i n t e d | o u t , | t h a t | i f | t h e | a p p l i c a n t s | a r e u n s u c c e s s f u l , |
| o r d e r s | f o r c o s t s migh t | b e made | d i s t i . n g o i s h i n g | ha tween | t h e |
| l i a b i l i t y o f | t h e c o r p o r a t e a p p l i c a n t s | and | t h a t o f | t h e f i r s t |
| a p p l i c a n t . | The | m a t t e r s which | I | have | d i s c u s s e d w e r e men t ioned |
| b y .Jenlcinson | J . | I n Iiuqhes | v . | Canon A u s t r a l i a P t v . | L t d . | ( 1 9 9 0 ) |
| I | r a i s e d w i t h M r Sheahan , | c o u n s e l | f o r t h e |
| a p p l i c a n t s , | t h e | q u e s t i o n | j u s t | t ouched | o n . | I I e | h a s | o b t a i n e d |
| i n s t r u c t i o n s t o t h e e f f e c t | t h a t e a c h o f | t h e a p p l i c a n t s wi l l . |
| s t a n d | r e s p n n s i h l e | f o r c o s t s | o r d e r e d | a g a i n s t | a n o t h e r | a p p l i c a n t . |
| T h i s c o u l d | b e | g i v e n | p r a c t i c a l | e f f e c t by | s i m p l y making | on | o r d e r |
| f o r c o s t s , | i f any | is made. |
| I t a p p e a r s | t o m e t h a t | t h e p r a c t i c a l | c o a r s e , | s o f a r |
| a s t h e c o n t e n t | o f | p a r a g r a p h | 7 | o f | M i s s 1 , i ndnn ' s | a f f i d a v i t | i s |
| c o n c e r n e d , | i s | t o | a s k M r Sheahan w h e t h e r | a n | a n d e r t a k j n g | a s |
| foreshadowed | w i l l | b e | f i l e d . | T t | i s g e n e r a l 1 y | t h o r ~ g h t | b e t t e r | t o |
| have | i t i n wri t - i ng . |
| T | t a k e | i n t o a c c o u n t | t h a t | t h e a p p l i c a t i o n | f o r |
| s e c i ~ r i t y | i s mad? | r a t h e r l a t e and | t h e s l .a temcnt | hy M r Shnahan, |
| nnw made, | Lhat | an u n d e r t a k i n g | i n terms | o f | p a r a g r a p h | 7 | o f | t h e |
| a f f i d a v i t o f | M i q s 1,indorl w i l l | h e | f i - l e d . |
| T h i s | i s n o t | a | c a s e j n | wh ich , | on | t h e | f i g u r e s p l a c e d |
| b e f o r e m e , | an | o r d e r | f o r s e c u r i t y would | b e | l i k e l y t o p r e v e n t |
| t h e pu r su i t . | o f | t h e c l a i m , | and | t h a t i s a | poi-nt emphasi-sed b y M r |
| n a i n . | I t a p p e a r s | t h a t a s s e t s a r e a v a i - l a b l e o v e r which |
| s e c u r i t y c o u l d b e g i v e n . | However, | i t a p p e a r s | n o t | t o b e , | i n |
| t h e whole | o f | t h e c i r c u m s t a n c e s , | n | p r o p e r | c a s e | i n which | t o |
| o r d e r | s e c u r i t y and | o n | t h e b a s i s o f | t h e | s t a t e m e n t | by M r Sheahan |
| t h a t | a n | a p p r o p r i a t e u n d e r t a k i n g | w j l l | b e | f i l e d , | t h e a p p l i c a t i o n |
| w i l l b e | r e f u s e d . |
| I | w i l l o r d e r t h a t t h e c o s t s o f | t o d a y h e co.;ts | i n t h e |
| p r o c e e d i n g s , | e x c e p t | j n s o f a r | a s t h o s e | c o s t s r e l - a t e t o t h e |
| a p p l i c a t i o n | f o r s e c u r i t y | f o r c o s t s . | A s | t o t h e | l a t t e r c o s t s , |
| t h e y w i l l h e | t h e c o s t s o f | t h e second | and | f o u r t h a p p l i c a n t s | i n |
| t h e p r i n c i p a l | p r o c e e d i n g s . |
| The | a p p l i c a t i o n | f o r d i r e c t i o n s w i l l h e | a d j o u r n e d |
| u n t i l Monday, | 9 Derernber, | a t 9 . 4 5 am. |
| I | c e r t i f y Chat. | t h i s and | t h e |
| folly | p r e r e d i n g p a g e s | a r e a |
| t r u n copy o f | tthe | r e a s o n s |
| f o r | juriyn~enL h ~ r n i | n | o f | I t i s |
Ilnnntir M r . Juc; 1.4 r'o Pi ncus
| Counsel fnr the appl irants: | Mr ,T .C . | Sheahan |
| Solicltors for the applicants: | 1,yoris |
| Counsel for the rn.spniirl~nt: | Mr R. G. nai.n |
| Solici tars for the respondent: | | Blake D R W ~ O ~ | Waldron | |
| Date of IIearl nq: | 1 4 Novrmher 1 99 1 |