FEDERAL COURT OF AUSTRALIA
Ninan v St George Bank Ltd [2013] FCA 818
Citation: Ninan v St George Bank Ltd [2013] FCA 818 Parties: GEORGE NINAN AND MOLLY GEORGE v ST GEORGE BANK LTD ABN 92 055 513 070, VALUER GENERAL, GODINI LAND DEVELOPMENT PTY LTD ACN 100 701 148 AND RICHARD AH BOEY TAY, DEBORAH ANDREWS, COLIN DYMOND, WANNUNUP DEVELOPMENT NOMINEES PTY LTD ACN 008 853 807 AND PORT BOUVARD LTD, SIMON WROTH, GREG PENN, NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937 and WESTPAC BANKING CORPORATION ABN 33 007 457 141 File number(s): NSD 617 of 2013 Judge(s): EDMONDS J Date of judgment: 15 August 2013 Catchwords: PRACTICE & PROCEDURE – application for leave to appeal from an interlocutory judgment dismissing application to vary orders to provide security for costs and also dismissing proceeding for failure to comply with such orders – principles to be applied where dismissal involves exercise of discretion as matter of practice and procedure Legislation: Federal Court of Australia Act 1976 (Cth) s 24(1A)
Foreign Judgments Act 1991 (Cth)
Racial Discrimination Act 1975 (Cth)
Federal Court Rules 2011 r 35.19Cases cited: Brambles Holdings Ltd v Trade Practices Commission (1979) 28 ALR 191 cited
Brimaud v Honeysett Instant Print Pty Ltd (1988) 6 ACLC 942 cited
Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 cited
House v R (1936) 55 CLR 499 cited
Ninan v St George Bank Ltd (2012) 294 ALR 190 discussed
Ninan v St George Bank Ltd (No 2) [2013] FCA 273 discussed
Truth About Motorways Ply Limited v Macquarie Infrastructure Investment Management Limited [2001] FCA 1603 citedDate of last submissions: 14 June 2013 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 62 Solicitor for the Applicant: The First Applicant filed submissions on behalf of the Applicants Solicitor for the Second Respondent: State Solicitor’s Office of Western Australia Counsel for the Fourth and Fifth Respondents: Mr MS White Solicitor for the Fourth and Fifth Respondents: Lander & Rogers Solicitor for the Sixth Respondents: The Company Secretary of Port Bouvard Ltd filed submissions on behalf of the Sixth Respondents Solicitor for the Seventh and Eighth Respondents: Colin Biggers & Paisley Counsel for the Ninth Respondent: Mr R Bellamy Solicitor for the Ninth Respondent: Gadens Lawyers Counsel for the Tenth Respondent: Mr P Newton Solicitor for the Tenth Respondent: Kemp Strang
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALESDISTRICT REGISTRY
GENERAL DIVISION
NSD 617 of 2013
BETWEEN: GEORGE NINAN AND MOLLY GEORGE
ApplicantAND: ST GEORGE BANK LTD ABN 92 055 513 070
First RespondentVALUER GENERAL
Second RespondentGODINI LAND DEVELOPMENT PTY LTD ACN 100 701 148 AND RICHARD AH BOEY TAY
Third RespondentDEBORAH ANDREWS
Fourth RespondentCOLIN DYMOND
Fifth RespondentWANNUNUP DEVELOPMENT NOMINEES PTY LTD ACN 008 853 807 AND PORT BOUVARD LTD
Sixth RespondentSIMON WROTH
Seventh RespondentGREG PENN
Eighth RespondentNATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937
Ninth RespondentWESTPAC BANKING CORPORATION ABN 33 007 457…
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Details
- Case
- [2013] FCA 818
- Decision Date
CaseChat Overview and Summary
The case of Ninan v St George Bank Ltd involved proceedings initiated by the applicants against various respondents, including St George Bank, seeking damages and other relief on the basis of alleged illegal activities. The applicants' claims were extensive, seeking damages amounting to a significant percentage of the respondents' estimated illegal gains from 2000 to 2012. The respondents, in turn, sought security for costs, arguing that the applicants' claims were without merit and that the applicants were impecunious and ordinarily resident outside Australia, making enforcement of any potential judgment difficult. The primary issue before the court was whether the security for costs orders made earlier should be varied in light of the applicants' failure to comply with those orders and their subsequent dismissal of the proceedings.
The court considered whether there had been a material change in circumstances since the security for costs was ordered, or whether new evidence had come to light that could not reasonably have been adduced earlier. The applicants argued that the new Federal Court Rules, which came into effect on 1 August 2011, should alter the approach to varying security for costs orders. However, the court found that there had been no material change in circumstances since the original security for costs order, and no new evidence had been presented. The applicants' impecuniosity, their residency outside Australia, the deficiencies in the pleadings, and the lack of admissible material suggesting matters of public interest remained unchanged. The court declined to vary the security for costs orders, finding that the applicants had not demonstrated any basis to warrant such a variation.
In conclusion, the court upheld the original security for costs orders, finding no material change in circumstances or new evidence that would justify a variation. The court emphasised that such orders should not be varied lightly, particularly after a contested hearing. The applicants' failure to comply with the security for costs orders led to the dismissal of their proceedings, and the court found no error in the primary judge's refusal to vary those orders. The applicants' arguments regarding the new Federal Court Rules were rejected, as there was no indication that these rules altered the criteria for varying security for costs orders.
The court considered whether there had been a material change in circumstances since the security for costs was ordered, or whether new evidence had come to light that could not reasonably have been adduced earlier. The applicants argued that the new Federal Court Rules, which came into effect on 1 August 2011, should alter the approach to varying security for costs orders. However, the court found that there had been no material change in circumstances since the original security for costs order, and no new evidence had been presented. The applicants' impecuniosity, their residency outside Australia, the deficiencies in the pleadings, and the lack of admissible material suggesting matters of public interest remained unchanged. The court declined to vary the security for costs orders, finding that the applicants had not demonstrated any basis to warrant such a variation.
In conclusion, the court upheld the original security for costs orders, finding no material change in circumstances or new evidence that would justify a variation. The court emphasised that such orders should not be varied lightly, particularly after a contested hearing. The applicants' failure to comply with the security for costs orders led to the dismissal of their proceedings, and the court found no error in the primary judge's refusal to vary those orders. The applicants' arguments regarding the new Federal Court Rules were rejected, as there was no indication that these rules altered the criteria for varying security for costs orders.
Orders
Orders of the court
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Background
Background to the litigation
Submissions from all relevant parties were duly filed.BACKGROUND The applicants commenced proceedings by way of an originating application and a statement of claim on 18 May 2012. The originating application sought an array of relief including (at para 15):[A]n order for exemplary damages or general damages which is marked as a percentage of their total estimated illegal gains in years 2000–2012 from the organized illegal scheme ($138 billion)a)St. George Bank, the first respondent: $13.8 billion (10% of the estimated gains) …f)Westpac Banking, the tenth respondent: $3 billion (2.5% of the estimated gains) In July 2012 the affected respondents filed interlocutory applications seeking orders that the applicants provide security for costs. The first and third respondents have not played a role in the proceedings, as the first respondent transferred its business to the tenth respondent and has since been deregistered, and the third respondent is a corporation in administration. On 11 July 2012 the applicants filed an interlocutory application seeking summary judgment against the respondents. The interlocutory application was returnable on 24 July 2012. On 24 July 2012 the respondents:(1)Submitted that the respondents’ interlocutory applications for security for costs should be heard and determined before the applicants’ interlocutory application for summary judgment; and(2)foreshadowed bringing interlocutory applications to strike out the statement of claim and/or for summary dismissal of the proceedings if the respondents were not successful on their interlocutory applications for security for costs. The Court listed the respondents’ interlocutory applications for security for costs for hearing on 21 August 2012 and deferred the hearing of the applicants’ application for summary judgment until after the security for costs issue was determined. Judgment on the respondents’ application for security for costs was delivered on 23 August 2012: Ninan v St George Bank Ltd (2012) 294 ALR 190 (“Security Judgment”). The Court ordered the applicants to provide security for costs in the form of bank guarantees to be lodged with the Court by 31 December 2012. The proceedings against the respondents were stayed pending compliance with the Security Judgment. The amount of security that the applicants were ordered to provide totalled $148,830, being the amount of costs the respondents were likely to incur up to and including the respondents’ foreshadowed applications to strike out the statement of claim or for summary dismissal of the proceedings (Security Judgment, [52]). The Court declined to make self-executing orders dismissing the proceedings in the event that the applicants did not comply with the Security Judgment. In the event that there was non-compliance with the Security Judgment, the Court noted that the affected respondents could make applications to have the proceedings dismissed (Security Judgment, [53]). The applicants did not file any application to appeal, or to seek leave to appeal, the Security Judgment.
Evidence
Evidence Before The Court
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Decision
Reasons for decision
It was not submitted by the applicants that either matter determined in the Dismissal Judgment finally determined the issues.Additionally, the dismissal on grounds ofnon-compliance has not been treated by the applicants as a dismissal with prejudice, in circumstances where the applicants have commenced fresh proceedings against a number of the respondents.Refusal to Vary Security Judgment – No Error The primary judge refused the application to vary the security for costs orders by applying a well-established line of authority which holds that an order for security for costs made after a contested hearing should not be varied unless there is:(1)A material change of circumstances since the original application was heard; or(2)new evidence to hand which could not reasonably have been adduced at the time of the hearing.(Dismissal Judgment, [10], [13]). The primary judge found that no material change in circumstances had arisen and that no new evidencehad been advanced by the applicants. Accordingly, there was no basis to warrant any variation of the security for costs orders (Dismissal Judgment , [13]). The applicants argued that the line of authority relied upon (see Truth About Motorways Ply Limited v Macquarie Infrastructure Investment Management Limited per Hely J, [2001] FCA 1603 at [11] and other cases referred to at [11] of the primary judge’s reasons) should not have been followed, and the commencement of the new Federal Court Rules on 1August 2011 changed the manner in which judicial discretion should be exercised when considering a variation of interlocutory orders (including security for costs orders). A comparison of the provisions relating to variation of interlocutory orders (including security for costs orders) in the Federal Court Rules applicable from 1 August 2011, and those in force prior to that date, suggest no altered jurisdiction or narrowing of the matters is to be considered by the Court when exercising its discretion. Such a change would be a fundamental alteration to the parameters of exercise of judicial discretion and would fetter the Court’s capacity to control its own processes. It would leave it open to parties to re-agitate interlocutory questions previously decidedwithoutanyrelevantrestrictions:see Brimaud v Honeysett Instant Print Pty Ltd (1988) 6 ACLC 942. The applicants failed to identify why such considerations would not apply to the new rules as they did to the old, and they also failed to identify any express provision effecting such a change.No Change in Circumstances The primary judge refused the application to vary the security for costs orders previously made as there was no basis to suggest that the circumstances warranting the previous orders for security for costs had changed (Dismissal Judgment,[14]). Those matters were:(1)The applicants’ impecuniosity.(2)The applicants being ordinarily resident outside of Australia and beyondreach of enforcement powers available by reason of the Foreign JudgmentsAct 1991 (Cth).(3)The serious deficiencies in the pleadings at the time the application for security for costs was heard which dislodged any presumption that the claim had reasonable prospects of success.(4)The inability of the applicants to discharge the evidentiary onus (as opposed to submissions or assertions) that their impecuniosity was solely attributable to the conduct of the respondents.(5)The absence of admissible material to suggest that matters of sufficient public interest arose,such as to warrant variation of the usual rules that apply to security for costs.
Ratio Decidendi
Legal Principle Established
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