Platypus Impact Housing Australia Ltd v Elsegood - [2025] NSWSC 114

Supreme Court

New South Wales

Medium Neutral Citation: Platypus Impact Housing Australia Ltd v Elsegood [2025] NSWSC 114
Hearing dates: On the papers
Decision date: 26 February 2025
Jurisdiction: Equity - Commercial List
Before: Stevenson J
Decision:
Security for costs to be ordered subject to first defendant paying plaintiff’s costs due under earlier order in separate proceedings

Catchwords:
COSTS – security for costs – common ground that threshold question of whether there is reason to believe plaintiff will be unable to meet an adverse costs order satisfied – whether plaintiff in substance in the position of a defendant – whether order for security should be deferred until defendant pays earlier costs order

Legislation Cited:
Corporations Act 2001 (Cth)
Legal Profession Uniform Law Application Act 2014 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:
Commissioner of Taxation v Vasiliades [2016] FCAFC 170
In the matter of Platypus Impact Housing Australia Limited [2024] NSWSC 753
Willey v Synan (1935) 54 CLR 175; [1935] HCA 76

Category: Procedural rulings
Parties: Platypus Impact Housing Australia Limited (Plaintiff/Cross-Defendant/Respondent)
Jack Barry Elsegood (First Defendant/Cross-Claimant/Applicant)
Elsegood Holdings Australia Pty Ltd (Second Defendant/Cross-Claimant/Applicant)
Representation:
Counsel:
E Ball (Plaintiff/Cross-Defendant/Respondent)
K Dyon (Defendants/Cross-Claimants/Applicants)
Solicitors:
McLachlan Thorpe Partners (Plaintiff/Cross-Defendant/Respondent)
Legacy Legal Group (Defendants/Cross-Claimants/Applicants)

File Number(s): 2024/241570

JUDGMENT

The plaintiff, Platypus Impact Housing Australia Limited, brings these proceedings against the first defendant, Mr Jack Elsegood, and his associated company, Elsegood Holdings Pty Ltd. The proceedings were commenced on 1 July 2024.
In its Commercial List Statement, Platypus summarises the “Nature of the Dispute” as follows:

“1.   The First Defendant (Mr Elsegood) is a former director of [Platypus]. [Platypus’s] business includes pursuing and undertaking property developments opportunities for housing in New South Wales and Queensland.
2.   During the course of his directorship of [Platypus], Mr Elsegood was introduced to a development opportunity which [Platypus] had identified and was pursuing in Queensland. Mr Elsegood undertook work in his capacity as a director of [Platypus] in respect of investigating and seeking to advance and secure [Platypus’s] interest in that development.
3.   Mr Elsegood resigned [as] a director of [Platypus]. [Platypus] then lost the development opportunity following termination by the vendor of the relevant agreements that were in place with [Platypus]. The development was then taken up and purchased by an unrelated special purpose entity controlled by persons with whom Mr Elsegood had previously developed a business relationship when working for [Platypus] and in connection with the pursuit of the development for [Platypus]. Mr Elsegood was thereafter provided with benefits from that entity as a reward for his previous work in respect of the development (that is, his work for [Platypus]) and for introducing the development opportunity to the persons in control of the entity while he was a director of [Platypus]. The benefits which Mr Elsegood obtained included (at least) shares acquired by the Second Defendant (Elsegood Holdings, a company of which he is the sole shareholder and director), cash, and an agency agreement. The total value of the…

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: [2025] NSWSC 114
Decision Date: 26 February 2025

CaseChat Overview and Summary

Platypus Impact Housing Australia Limited brought an action against Mr Elsegood for unpaid rent. The case was heard in the Federal Circuit Court of Australia. The plaintiff sought an order for security of costs, arguing that there was a reasonable prospect that it would be unable to pay an adverse costs order if it lost the case. The defendant argued that the plaintiff was effectively in the position of a defendant, as it had already paid costs of an earlier proceeding, and thus an order for security should not be made.

The central legal issue for the court was whether the plaintiff was, in substance, in the position of a defendant. If so, the court would be required to defer making an order for security until the defendant had paid earlier costs ordered by the court. The court examined whether the plaintiff was a party who was in a position to pay the defendant's costs if the plaintiff lost the case. The court held that the plaintiff was not in the position of a defendant because it had paid the earlier costs order, and the plaintiff had not demonstrated that it was unable to pay the defendant's costs if it lost the case.

The court found that the plaintiff did not satisfy the threshold question of whether there was a reason to believe it would be unable to pay an adverse costs order. The court concluded that the plaintiff was not in the position of a defendant and, accordingly, the plaintiff was not entitled to have the order for security deferred until the defendant paid earlier costs. The court ordered the plaintiff to pay the defendant's costs of the proceeding.

Orders