Microbio Resources Inc v Betatene Ltd - [1993] FCA 848

8 9 8 , 93

JUDGMENT No. ..... ,..., .... ,.,. g. - ,.
CATCHWORDS

PRACTICE AND PROCEDURE - Security for Costs - matter struck out for fa~lure to provide security for costs - failure on repeated occasions to provide ordered security - fallure to provide any information as to when payment could be expected - whether judge properly exercised d~scretion.

Federal Cortrt of A~i.sfsl,nlio Act 1976 S. 56(4)
Federal Court Rides 0. 28 rr. 4, 5

Le~lijamcrr Ply Limited v AGC (1990) 27 FCR 388 at 395

I ,

REGISTRY

MCROBIO RESOURCES INC v BETATENE LIMITED

Black CJ, Sheppard & Einfeld JJ
8 October 1993

FEDERAL COURT OF

Melbourne

AUSTRALIA PRINCIPAL

IN THE FEDERAL COURT OF AUSTRALIA 1 No. VG 228 of 1993
VI(XOR1AN DTSTRICI REGISTRY
GENERAL DIVISION j
On Appeal from a judge of the Federal Court of Australia
BETWEEN. MICROBIO RESOURCES INC
Appellant

AND: BETATENE LIMITED
Respondent

COURT: Black CJ, Sheppard & Einfeld JJ

DATE: 8 October 1993
PLACE: Melbourne
MINUTES OF ORDERS

THE COURT ORDERS THAT:
1. The appeal be dismissed.
2. The appellant pay the respondent's costs of the appeal.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court
Rules.

IN THE FEDERAL COURT OF AUSTRALIA 1 No. VG 228 of 1993
VICTORIAN DISTRICT REGISTRY
1
GENERAL DIVISION j
On Appeal from a judge of the Federal Court of Australia
BETWEEN: MTCROBIO RESOURCES INC
Appellant

AND: BETATENE LIMITED
Respondent

COURT: Black Cl, Sheppard & Einfeld JJ

DATE: 8 October 1993
PLACE: Melbourne
EX TEWORE REASONS FOR JUDGMENT

THE COURT. This is an appeal from orders made by a judge of thls Court that the clam of the appl~cant, Microbio Resources Incorporated (Microbio), the appellant in this appeal, be dismissed with cosls and that the security provided by Microb~o for the

respondent's costs (by way of banker's certificate dated 24 January 1992) be applied
towards of the respondent's taxed costs. The primary judge also ordered that all conf~dentlal information provlded by the respondent to the apphcant's solicltors or experts be returncd within seven days.
These orders were made on the motlon of the respondent to the proceeding, and the
respondent to thls appeal, Betatene Limited (Betatene). The order dismissing
Microbio's claim was sought by Betatene on the ground that Microbio had failed to

provide secur~ty for costs as ordered by the Court in circumstances we shall outline.
Microbio is a corporation incorporated under the laws of the State of Delaware in the
United States of America and is the registered proprietor of an Australian patent
relating to an invention entitled "Naturally Derived Carotene Oil Composition and the Process for the Production thereof." Betatene is a South Australian company which
has been producing and marketing a substance which 1s alleged to infringe Microbio's
patent.

M~crobio commenced the proceeding on 11 November 1993. It claimed that Betatene
had infringed its patent and it sougllt an injunction restra~ning Betatene from ~nfringement, damages or an account of profits, and other relief. Betatcne denied…

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: [1993] FCA 848
Decision Date: 8 Oct 1993

CaseChat Overview and Summary

The Federal Court of Australia heard an appeal from Microbio Resources Inc (Microbio), a Delaware corporation, against an order dismissing their claim for patent infringement against Betatene Limited (Betatene), a South Australian company. Microbio had failed to provide the ordered security for Betatene's costs despite multiple extensions. The primary judge, Northrop J, had ordered Microbio to provide security for costs, which was initially met but subsequently not met as additional security was required. Multiple extensions were granted, but Microbio failed to provide the additional security by the final deadline of 30 April 1993. Betatene applied for the proceeding to be dismissed, which was granted by the primary judge. Microbio appealed, arguing that the primary judge's discretion was improperly exercised.

The court considered whether the primary judge had the power to dismiss the proceeding for failure to provide security for costs and whether the judge's discretion was properly exercised. The court noted that under the Federal Court of Australia Act and the Federal Court Rules, the court has the power to dismiss a proceeding for failure to provide security for costs. The court also highlighted that the primary judge's discretion was not limited in the manner suggested by Microbio. The court concluded that the primary judge's decision to dismiss the proceeding was justified, given Microbio's failure to provide any evidence or explanation as to why it had not complied with the security order and the multiple extensions granted.

The appeal was dismissed with costs. The court emphasized that parties must provide evidence of their position if they fail to comply with security orders, and that Betatene's preparation for trial did not weaken its position regarding security for costs.

Orders