Microbio Resources Inc. v Betatene Ltd - [1992] FCA 503

Re: MICROBIO RESOURCES, INC.
And: BETATENE LIMITED
No. V G300 of 1991
FED No. 503
Practice and Procedure

COURT

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
Olney J.(1)

CATCHWORDS

Practice and Procedure - security for costs - order that proceedings be stayed if security not provided within specified time - security not provided within time specified - power of Court to dismiss proceedings without trial - application to dismiss originating application brought 2 days after expiration of time for providing security.

Federal Court Act 1976, ss. 56 and 59

Federal Court Rules, O.10, r.7

Speed Up Holdings Limited v. Gough and Co. (Handly) Limited (1986) Fleet St. R 330.

Charlie Carter Pty Ltd v. The Shop, Distributive and Allied Employees' Association of WA and others (1987) 13 FCR 413.

Lenijamar Pty Ltd and others v. AGC (Advances) Ltd (1990) 98 ALR 200.

HEARING

MELBOURNE

#DATE 14:7:1992

Counsel and solicitors for
the applicant: Mr B.J. Hess instructed by

Arthur Robinson and Hedderwicks

Counsel and solicitors for
the respondent: Mr M. Hines instructed by

Freehill Hollingdale and Page

ORDER

The Court orders that:

1. The respondent's notice of motion filed 1 July 1992 be dismissed.

2. The order made herein by Northrop J. on 1 June 1992 be varied:

(a) by substituting for the second sentence in the order numbered 1, the following sentence:

Such security is to be provided within 28 days of the completion of the mediation proceedings referred to in orders 4 to 6 of this order in such form as the parties may agree or in default of agreement as the Registrar may determine.

(b) by substituting for order numbered 2 the following:

2. In the event that the applicant fails to provide security within the time limited by this order or further order, proceedings on the applicant's application herein be stayed until further order with liberty to apply.

3. The District Registrar confer with the solicitors for the parties with a view to taking such steps as may be necessary to give effect to orders 4 to 6 of the order made by Northrop J. on 1 June 1992, and upon completion of the mediation process that fact and the date thereof be noted on the file.

4. Costs of both parties be reserved.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

On 1 June 1992 Northrop J. made orders in this matter, inter alia, that:

1. The Applicant provide security in the sum of $90,000.00 for costs incurred and to be incurred by the Respondent down to the completion of mediation proceedings before the Registrar. That is in addition to the sum of $20,000.00 already provided. Such security is to be provided within 28 days in such form as the parties may agree or in default of agreement as the Registrar may determine. There is liberty to the Respondents to make such further application for security for costs as they…

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: [1992] FCA 503
Decision Date: 14 JULY 1992

CaseChat Overview and Summary

Microbio Resources Inc. filed an action against Betatene Ltd in the Federal Court of Australia, seeking to recover damages for alleged breaches of contract. The dispute involved complex issues regarding the terms of the contract and the extent of the alleged breaches. The court was required to decide whether to grant an order for security for costs, which would require Microbio Resources to provide financial assurance to cover Betatene Ltd's costs if the proceedings were unsuccessful. The court was also required to determine whether to dismiss the proceedings if security was not provided within the specified time.

The court found that the parties had agreed to mediate their dispute before proceeding further with the litigation. The court varied the earlier order to require security for costs to be provided within 28 days of the completion of the mediation proceedings. The court also ordered that proceedings be stayed if security was not provided within the new time limit. The court found that Betatene Ltd's notice of motion, filed two days after the original time limit for providing security had expired, was invalid. The court held that it had the power to dismiss the proceedings without trial if security was not provided within the new time limit.

The court's orders reflect a willingness to facilitate alternative dispute resolution and to ensure that the parties bear the costs of litigation in appropriate cases. The court's decision to vary the order for security for costs to accommodate the parties' agreement to mediate demonstrates a commitment to promoting efficient and effective dispute resolution. The court's decision to dismiss Betatene Ltd's notice of motion highlights the importance of adhering to court-imposed time limits and the potential consequences of failing to do so.

The final orders of the court reflect a balanced approach to the issues before it. The court's decision to vary the order for security for costs to accommodate the parties' agreement to mediate is likely to promote efficient and effective dispute resolution. The court's decision to dismiss Betatene Ltd's notice of motion sends a clear message about the importance of adhering to court-imposed time limits. The court's decision to reserve costs pending the outcome of the mediation process ensures that the parties bear the costs of litigation in appropriate cases.

Orders

Orders of the court

The Court orders that:

1. The respondent's notice of motion filed 1 July 1992 be dismissed.

2. The order made herein by Northrop J. on 1 June 1992 be varied:

(a) by substituting for the second sentence in the order numbered 1, the following sentence:

Such security is to be provided within 28 days of the completion of the mediation proceedings referred to in orders 4 to 6 of this order in such form as the parties may agree or in default of agreement as the Registrar may determine.

(b) by substituting for order numbered 2 the following:

2. In the event that the applicant fails to provide security within the time limited by this order or further order, proceedings on the applicant's application herein be stayed until further order with liberty to apply.

3. The District Registrar confer with the solicitors for the parties with a view to taking such steps as may be necessary to give effect to orders 4 to 6 of the order made by Northrop J. on 1 June 1992, and upon completion of the mediation process that fact and the date thereof be noted on the file.

4. Costs of both parties be reserved.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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