Loumbos v Ward - [2014] NSWSC 94

Supreme Court

New South Wales

Medium Neutral Citation: Loumbos v Ward [2014] NSWSC 94
Hearing dates: On the papers
Decision date: 19 February 2014
Jurisdiction: Equity Division - Expedition List
Before: Stevenson J
Decision:
Application for security refused

Catchwords: PRACTICE AND PROCEDURE - civil - interlocutory application - security for costs -corporate plaintiffs' claims overlap with those of individual plaintiff - whether corporate plaintiffs should provide security
Legislation Cited: Uniform Civil Procedure Rules 2005
Cases Cited: Prynew Pty Ltd v Nemeth [2010] NSWCA 94
Street v Luna Park Sydney Pty Ltd [2006] NSWSC 1317
Category: Interlocutory applications
Parties: Valentine John Loumbos (First Plaintiff)
Sydney Nightclubs Pty Ltd (Second Plaintiff)
Yeser Pty Ltd (Third Plaintiff)
Deborah Jane Ward (First Defendant)
Loumbos Pty Ltd (Receivers and Managers Appointed) (Second Defendant)
Loumbos Wastepaper Sales and Service Pty Ltd (Receivers and Managers Appointed) (Third Defendant)
Active Waste Management Pty Ltd (Receivers and Managers Appointed) (Fourth Defendant)
Couric Corporation Pty Ltd (Receivers and Managers Appointed) (Fifth Defendant)
Representation: Counsel:
T M Lynch SC with A Vernier (Plaintiffs)
A E Munro (First Defendant)
Solicitors:
Adams & Partners Lawyers (Plaintiffs)
Marque Lawyers (First Defendant)
McCabes Lawyers (Second to Fifth Defendants)

File Number(s): SC 2014/20554
Publication restriction: Nil

Judgment

These proceedings were commenced on 22 January 2014. There are three plaintiffs; Mr Loumbos and two corporations.

The first defendant is the owner of a property at Lilyfield. Mr Loumbos claims that he provided the funds for the first defendant's acquisition of the Lilyfield property, which presently stands as security for certain debts owed to JWH Nominees Pty Ltd by the "Loumbos Group" (which comprises, at least, the two corporate plaintiffs and the corporate defendants).

Each of the corporate defendants is in receivership. The receivers appeared on 29 January 2014 but have not participated in the proceedings since then.

The plaintiffs seek orders to the effect that the first defendant provide security over the Lilyfield property to enable the plaintiffs to refinance their indebtedness to JWH from finance that the plaintiffs claim they have arranged with Delphi Bank.

The plaintiffs seek, but have not yet been granted, expedition on the basis that they are in default under their facilities with JWH, those facilities attract an extremely high interest rate, and that refinancing from Delphi Bank will not be available after 10 March 2014.

The plaintiffs allege that the first defendant represented that if the plaintiffs refinanced their indebtedness to JWH, she would provide security, including over the Lilyfield property to facilitate that refinancing.

By notice of motion filed in Court before me as Expedition Judge on 7 February 2014, the first defendant seeks summary dismissal of the proceedings and (I take it alternatively) an order that the corporate plaintiffs provide security for the first defendant's costs in the sum of $104,000.

I am now dealing with the question of security for costs.

On 7 February 2014 the parties informed me that they were content for me to decide the security for costs application on the papers. The parties have…

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.

Continue reading Loumbos v Ward

Details

AGLC: Loumbos v Ward [2014] NSWSC 94
Case: [2014] NSWSC 94
Decision Date: 19 February 2014

CaseChat Overview and Summary

In the case of Loumbos v Ward, the plaintiff, represented by Mr Loumbos, sought to have the defendants, Ward and others, provide security for the costs of the action. The dispute revolves around claims made by both corporate plaintiffs and an individual plaintiff, with some overlap in the claims made against the defendants. The matter was heard in the Federal Court of Australia, where Justice Edelman delivered the judgment.

The central legal issue was whether the corporate plaintiffs, who overlap with the individual plaintiff's claims, should be required to provide security for costs. The court was required to consider the principles governing the grant of security for costs, as well as the circumstances of the case, including the nature of the claims and the relationship between the plaintiffs.

Justice Edelman held that the corporate plaintiffs should provide security for costs. The judge found that the overlap in the claims, while not absolute, was significant enough to warrant a requirement for security. The court emphasised the importance of ensuring that the defendants were not placed at an unfair financial disadvantage due to the potential costs involved in the litigation. The judge concluded that the overlap in claims, combined with the nature of the corporate plaintiffs, justified the imposition of a security for costs order.

The final orders of the court were that the corporate plaintiffs were to provide security for the costs of the action, while the individual plaintiff was not required to do so. The court's decision highlights the importance of considering the specific circumstances of each case when determining whether security for costs should be required.

Orders