NELDUE PTY LTD -v- MORAN & ORS [2004] WASC 100

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2004] WASC 100
Published:	19/05/2004
Case No:	CIV:1867/2002	Heard:	8 APRIL 2004
Coram:	MASTER SANDERSON	Delivered:	8/04/04
No of pages:	6	Judgment Part:	1 of 1
Result:	Security refused
Category:	B
PDF Version

Parties:	NELDUE PTY LTD ROBERT JAMES MORAN VASSAL PTY LTD WENDY'S SUPA SUNDAES PTY LTD
Catchwords:	Practice and procedure Application for security for costs Turns on own facts
Legislation:	Corporations Act, s 1335
Case References:	BPM Pty Ltd v HPM Pty Ltd (1996) 14 ACLC 857 Bell Wholesale Co Pty Ltd v Gates Expert Corporation (1984) 52 ALR 176 Buckley v Bennell Design & Constructions Pty Ltd (1974) 1 ACLR 301 Crypta Fuels Pty Ltd & Anor v Svelte Corporation Pty Ltd (1996) 14 ACLC 393 FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd [2000] 22 WAR 241 Idoport Pty Ltd v National Australia Bank Ltd; Idoport Pty Ltd v Argus; Idoport Pty Ltd ("JMG") v National Australia Bank (No 35) [2001] NSWSC 744 Scanlan v Greenport Nominees [2001] WASC 307 Westralian Gold Mines Ltd v Westralian Minerals & Drilling Pty Ltd (In Liq) (1986) 4 ACLC 167 Yandil Holdings Pty Ltd v Insurance Co of North America & Ors (1985) 3 ACLC 542

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : NELDUE PTY LTD -v- MORAN & ORS [2004] WASC 100 CORAM : MASTER SANDERSON HEARD : 8 APRIL 2004 DELIVERED : 8 APRIL 2004 PUBLISHED : 19 MAY 2004 FILE NO/S : CIV 1867 of 2002 BETWEEN : NELDUE PTY LTD

Plaintiff

AND

ROBERT JAMES MORAN

First Defendant

VASSAL PTY LTD

Second Defendant

WENDY'S SUPA SUNDAES PTY LTD

Third Defendant

Catchwords:

Practice and procedure - Application for security for costs - Turns on own facts

Legislation:

Corporations Act, s 1335

(Page 2)

Result:

Security refused

Category: B

Representation:

Counsel:

Plaintiff : Mr H R Robinson

First Defendant : Mr M P Cornes

Second Defendant : Mr M P Cornes

Third Defendant : Mr M P Cornes

Solicitors:

Plaintiff : Haydn Robinson

First Defendant : Minter Ellison

Second Defendant : Minter Ellison

Third Defendant : Minter Ellison

Case(s) referred to in judgment(s):

BPM Pty Ltd v HPM Pty Ltd (1996) 14 ACLC 857

Case(s) also cited:

Bell Wholesale Co Pty Ltd v Gates Expert Corporation (1984) 52 ALR 176
Buckley v Bennell Design & Constructions Pty Ltd (1974) 1 ACLR 301
Crypta Fuels Pty Ltd & Anor v Svelte Corporation Pty Ltd (1996) 14 ACLC 393
FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd [2000] 22 WAR 241
Idoport Pty Ltd v National Australia Bank Ltd; Idoport Pty Ltd v Argus; Idoport Pty Ltd ("JMG") v National Australia Bank (No 35) [2001] NSWSC 744
Scanlan v Greenport Nominees [2001] WASC 307
Westralian Gold Mines Ltd v Westralian Minerals & Drilling Pty Ltd (In Liq) (1986) 4 ACLC 167
Yandil Holdings Pty Ltd v Insurance Co of North America & Ors…

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: [2004] WASC 100
Decision Date

CaseChat Overview and Summary

The Supreme Court of Western Australia was tasked with deciding whether the plaintiff, NELDUE Pty Ltd, should provide security for costs in a case brought against Robert James Moran, Vassal Pty Ltd, and Wendy's Supa Sundaes Pty Ltd. The plaintiff's claim involved allegations of misrepresentation and negligent misstatement in connection with a franchise agreement for a Wendy's store in Albany. The defendants argued for an order requiring the plaintiff to provide security for their costs, claiming that the plaintiff was likely unable to pay the costs if they were to be unsuccessful in their defence. The plaintiff, on the other hand, argued that the imposition of security for costs would effectively stymie their action due to their current financial incapacity.

The court examined the evidence regarding the financial status of the plaintiff and those behind it, as well as the potential impact of ordering security on the plaintiff's ability to pursue the action. The court found that the plaintiff had conceded that if unsuccessful, it could not meet any order for costs. The plaintiff presented evidence indicating that their investment in the Wendy's franchise had led to financial ruin, consuming all their assets, including their home and superannuation. The court considered this evidence sufficient to conclude that the plaintiff, and those behind it, were without means to provide security.

The court also took into account the delay in bringing the application for security, which was not yet ready for trial, and the unfairness of imposing security after the plaintiff had already incurred significant costs. The court's discretion was exercised in favour of the plaintiff, and the application for security for costs was dismissed. The court indicated that it would address the form of order and costs in a subsequent hearing.

Orders