Panlyn Australia Pty Ltd v Austin Computers Pty Ltd - [2023] WADC 80

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION:   PERTH
CITATION:   PANLYN AUSTRALIA PTY LTD -v- AUSTIN COMPUTERS PTY LTD [2023] WADC 80
CORAM:   HUGHES DCJ
HEARD:   27 JUNE 2023
DELIVERED          :   17 JULY 2023
FILE NO/S:   CIV 3741 of 2022
BETWEEN:   PANLYN AUSTRALIA PTY LTD
Plaintiff
AND
AUSTIN COMPUTERS PTY LTD
First Defendant
ZHAN SHAN HUANG
Second Defendant

Catchwords:

Practice and procedure - appeal against registrar's decision granting security for costs - Application for security for costs

Legislation:

Corporations Act 2001 (Cth), s 1335
District Court Rules 1971 (WA), r 15(6)

Result:

Appeal allowed

Representation:

Counsel:

Plaintiff	:	Mr M G S Crowley
First Defendant	:	Mr P G McGowan
Second Defendant	:	Mr P G McGowan

Solicitors:

Plaintiff	:	Exceed Legal
First Defendant	:	Metaxas Legal
Second Defendant	:	Metaxas Legal

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

Australian Lens Laboratories Pty Ltd (Receiver and Manager Appointed) v National Australia Bank Ltd [2007] WASC 73
CBS Records Australia Ltd v Telmark Teleproducts (Aust) Pty Ltd (1987) 72 ALR 270
FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd (2000) 22 WAR 241
KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189
Leader Computers Pty Ltd v Panlyn Australia Pty Ltd [2023] WADC 3
Mabrouk Minerals Pty Ltd v Mabrouk Holdings Ltd [2008] WASC 132
Vintage Marine Art Pty Ltd v Henderson and Cremer (No 2) (2019) 101 NSWLR 77

HUGHES DCJ:

On the 6 February 2022 the plaintiff filed an amended appeal notice seeking to appeal against the decision of Deputy Registrar Harman made on 2 February 2023 that:
1.the plaintiff do provide security for the defendant's (sic) costs of the action to the extent of $35,000 in a manner satisfactory to the defendant and failing agreement in a manner determined by the court; and
7.the plaintiff pay the defendant's (sic) costs of the application insofar as it relates to security for the defendant's (sic) costs of the action in any event.
The original appeal notice was filed on 3 February 2023 and was filed within time.

The primary proceedings

The plaintiff (Panlyn) commenced action by writ of summons filed on 30 August 2022 against the first defendant (Austin) and the second defendant (Mr Huang). Mr Huang is the sole director of Austin. Both Panlyn and Austin are duly incorporated companies in Western Australia. The third amended statement of claim filed on 16 March 2023 sets out an action against Austin and Mr Huang in conversion. Panlyn also alleges breaches of the franchise agreement and seeks payment and damages.
Although the writ was filed on 30 August 2022, this matter has had a lengthy history in this court. By way of background, on or around 9 January 2018[1] Austin granted Panlyn a licence by way of a franchise agreement to operate a business known as 'Austin Computers' from different premises in Perth. A term of the franchise agreement was Panlyn was to pay Austin a franchise fee. It was also agreed between Panlyn…

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: [2023] WADC 80
Decision Date: 17 JULY 2023

CaseChat Overview and Summary

The case between Panlyn Australia Pty Ltd and Austin Computers Pty Ltd came before the court, where the primary issue was whether the registrar had correctly exercised their discretion in granting an order for security for costs. The dispute centred around a complex commercial matter, with Panlyn being the applicant and Austin being the respondent. Panlyn had sought an order for security for costs from Austin, which was granted by the registrar. Austin then appealed this decision, arguing that the registrar had erred in their assessment.

The court had to determine the legal principles governing the granting of security for costs, particularly focusing on the discretion of the registrar. The key issues were whether the registrar had a proper basis for concluding that an order for security for costs was necessary and whether there was an error in the exercise of that discretion. The court needed to consider the evidence presented to the registrar and the legal framework that guided the registrar's decision-making process.

The court reviewed the registrar's decision and found that it had followed the correct legal principles in granting the order for security for costs. The registrar had considered the relevant factors, including the financial position of the parties, the complexity of the case, and the likelihood of one party incurring significant costs if the other were to be unsuccessful. The court determined that the registrar's discretion was properly exercised and that there was no basis for the appeal. Therefore, the appeal was dismissed, and the order for security for costs remained in place.

Orders