Lothaven P/L v Create-A-Book (Australasia) P/L

[1994] FCA 119

119     q y

JUDGMENT NO. ..I..H.n.H.I.I.J n n m n o n n .

NOT SUITABLE FOR DISTRIBUTION

I N THE FEDERAL COURT OF AUSTRALIA	) )
NEW SOUTH WALES DISTRICT REGISTRY	) NG 171 of 1992
1
GENERAL DIVISION	1

BETWEEN:  LOTHAVEN PTY LIMITED

Applicant

AND :	CREATE-A-BOOK	(AUSTRALASIA) PTY
L I M I T E D

Respondent

CORAM: Burchett J.

PLACE: Sydney

DATE : 11 February 1994 18 MAR l994

REASONS FOR JUDGMENT REGISTRY

BURCHETT J.:

I n t h i s matter , an order f o r s e c u r i t y f o r cos t s i n t h e

t o t a l sum of $15,000 was made by consent by Foster J. a t t h e very beginning of t h e proceedings. The respondents now seek

t o have t h a t order q u i t e s u b s t a n t i a l l y increased and they

point t o t h e increased es t imate of t h e length of t h e hearing

a f f i d a v i t f i l e d t o supporttheoriginalapplicationwasthreedays.

of t h e mat ter . It is a l s o a mat ter of t h e h i s t o ry of it t h a t

they have changed s o l i c i t o r s during t h e course of t h e

preparat ion of t h e matter f o r t r i a l , and I th ink it would be

f a i r t o comment t h a t p a r t of t h e increased cos t s i s very

l i k e l y t o be due t o t h e consequences of t h a t . However, it is,

i n addi t ion , t r u e t h a t t h e es t imate of t h e length of t h e

hearing i s now e i g h t days, whereas t h e es t imate given i n t h e

At the time the proceedings were commenced, they were begun by a company in which only one person was beneficially interested. That person was Miss Minehan, who was a director and a shareholder. She, on the evidence, has expended a very substantial amount of money on these proceedings, so that she is now virtually denuded of assets. She has suffered some ill health, and is presently not in receipt of remuneration, or certainly not in receipt of any substantial remuneration so as to be able to meet an order for security for costs in the amount that is in issue here.

The security ordered by consent was in fact provided, and some $20,000 has been paid to the applicant's own solicitors and a further $100,000 is owing to them. That, of course, cuts both ways, insofar as it indicates in favour of the applicant for security that the costs incurred by the other side at any rate are very substantial; but it also indicates that a great burden has already been accepted by Miss Minehan, and adds to the unfairness that would be involved in

due for hearing in a matter of a couple of months. The court	stultifying this proceeding, at this late stage, when it is
has a wide discretion in relation to security for costs, a fact that has repeatedly been emphasised. I emphasised it in Quad Consultins Ptv Limited v. David R Bleaklev and Associates Ptv Limited, an unreported decision delivered on 28 June 1991.
In my opinion, the matter which is of crucial significance in the present case is that the evidence plainly shows neither the company nor Miss Minehan is, in fact, in possession of any significant assets from which the security could be provided if security were ordered. I accept the evidence of Miss Minehan, and I reach the firm conclusion that the making of such an order would stultify the proceedings. In the exercise of my discretion, I think it is appropriate that I decline to make an order, and I do so decline. As regards the costs of this application, I order that the costs be the costs of the applicant in the principal proceeding.

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of his Honour Mr Justice Burchett.

Associate: *	U&&&
Date: 11 February 1994

Counsel for the Applicant in

the principal proceeding:	Mr H.K. Insall
Solicitors for the Applicant in
the principal proceeding:	Messrs Michell Sillar
Counsel for the Respondent
(Applicant for security):	Mr P.L.G. Brereton
Solicitors for the Respondent	Messrs Blake Dawson
(Applicant for security):	Waldron
Date of hearing:	11 February 1994