Precious 1 Pty Ltd v Chamberlain Early Learning Centre Pty Ltd - [2017] NSWCA 259

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Precious 1 Pty Ltd v Chamberlain Early Learning Centre Pty Ltd [2017] NSWCA 259
Hearing dates: 9 October 2017
Date of orders: 13 October 2017
Decision date: 13 October 2017
Before: Macfarlan JA
Decision:
The respondent’s notice of motion is dismissed with costs.

Catchwords: APPEAL – application for security for costs – s 1335(1) Corporations Act 2001 (Cth) – corporate trustee with right of indemnity – evidence does not indicate that the appellant would be unable to pay costs if unsuccessful on appeal – notice of motion dismissed
Legislation Cited: Conveyancing Act 1919 (NSW)
Corporations Act 2001 (Cth) s 1335(1)
Real Property Act 1900 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Beach Petroleum NL v Johnson (1992) 7 ACSR 203
CGU Insurance Ltd v One.Tel Ltd (in liq) (2010) 242 CLR 174; [2010] HCA 26
Lemery Holdings Pty Ltd v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550; [2008] NSWSC 1344
Livingspring Pty Ltd v Kliger Partners (2008) 20 VR 377; [2008] VSCA 93
Street v Luna Park Sydney Pty Ltd [2006] NSWSC 1317
Category: Procedural and other rulings
Parties: Precious 1 Pty Ltd (Applicant)
Chamberlain Early Learning Centre Pty Ltd (Respondent)
Representation:
Counsel:
A Macauley (Applicant)
V Bedrossian (Respondent)
Solicitors:
David Legal (Applicant)
Etheringtons (Respondent)

File Number(s): CA 2017/163393
Decision under appeal

Court or tribunal:

Supreme Court

Jurisdiction:

Equity

Citation:

[2017] NSWSC 189 and [2017] NSWSC 520

Date of Decision:

9 March 2017 and 5 May 2017

Before:

Emmett AJA

File Number(s):

SC 2016/210312

Judgment

HIS HONOUR: This is an application by Chamberlain Early Learning Centre Pty Ltd (“CEL”) for security for its costs of an application by Precious 1 Pty Ltd (“Precious 1”) for leave to appeal and, if leave is granted, an appeal from judgments of Emmett AJA of 9 March and 5 May 2017 (Chamberlain Early Learning Centre Pty Ltd v Precious 1 Pty Ltd [2017] NSWSC 189 and [2017] NSWSC 520). The application for leave to appeal and the intended appeal are fixed for a concurrent hearing before this Court on 4 December 2017. The application for security has been brought promptly.
CEL is the lessee of premises at Guildford of which Precious 1 is the registered proprietor. Rent payable under the lease is $16,170.23 per month. Over two years of the lease term remains.
Precious 1 became the registered proprietor of the premises as a result of the registration of a transfer of the fee simple in the property. The transfer was dated 4 January 2016, but was not registered until 23 June 2016. Although CEL’s lease was on foot at the time the transfer was signed, CEL was not informed of it until it was registered on 23 June 2016.
The purpose and effect of the transfer was to substitute Precious 1 for the then registered proprietor (4 Chamberlain Pty Ltd – the “Assignor”) as the registered proprietor of the property, and as…

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.

Keep reading for free

Create a free CaseChat account to read Precious 1 Pty Ltd v Chamberlain Early Learning Centre Pty L... and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2017] NSWCA 259
Decision Date: 13 October 2017

CaseChat Overview and Summary

Precious 1 Pty Ltd (appellant) appealed a decision of the primary judge. Chamberlain Early Learning Centre Pty Ltd (respondent) sought security for costs of the appeal pursuant to s 1335(1) of the *Corporations Act 2001* (Cth). The appellant was the trustee of a trust and argued that its right of indemnity over the trust assets meant it would be able to pay costs if unsuccessful.

The central legal issue before the Court of Appeal was whether the respondent had established that the appellant would be unable to pay the respondent's costs if the appeal were unsuccessful, thereby justifying an order for security for costs under s 1335(1) of the *Corporations Act 2001* (Cth).

Macfarlan JA considered the evidence presented and noted that while the appellant was a corporate trustee, there was no evidence to suggest that the appellant would be unable to meet any costs order made against it. The Court applied the principle that an applicant for security for costs must demonstrate a real risk that the respondent would be unable to pay costs. In this instance, the appellant's right of indemnity over trust assets, coupled with the absence of evidence to the contrary, meant this threshold was not met.

Consequently, the respondent's notice of motion for security for costs was dismissed with costs.

Orders

Orders of the court

The respondent’s notice of motion is dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Medium Neutral Citation:	Precious 1 Pty Ltd v Chamberlain Early Learning Centre Pty Ltd [2017] NSWCA 259
Hearing dates:	9 October 2017
Date of orders:	13 October 2017
Decision date:	13 October 2017
Before:	Macfarlan JA
Decision:	The respondent’s notice of motion is dismissed with costs.
Catchwords:	APPEAL – application for security for costs – s 1335(1) Corporations Act 2001 (Cth) – corporate trustee with right of indemnity – evidence does not indicate that the appellant would be unable to pay costs if unsuccessful on appeal – notice of motion dismissed
Legislation Cited:	Conveyancing Act 1919 (NSW) Corporations Act 2001 (Cth) s 1335(1) Real Property Act 1900 (NSW) Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited:	Beach Petroleum NL v Johnson (1992) 7 ACSR 203 CGU Insurance Ltd v One.Tel Ltd (in liq) (2010) 242 CLR 174; [2010] HCA 26 Lemery Holdings Pty Ltd v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550; [2008] NSWSC 1344 Livingspring Pty Ltd v Kliger Partners (2008) 20 VR 377; [2008] VSCA 93 Street v Luna Park Sydney Pty Ltd [2006] NSWSC 1317
Category:	Procedural and other rulings
Parties:	Precious 1 Pty Ltd (Applicant) Chamberlain Early Learning Centre Pty Ltd (Respondent)
Representation:	Counsel: A Macauley (Applicant) V Bedrossian (Respondent) Solicitors: David Legal (Applicant) Etheringtons (Respondent)
File Number(s):	CA 2017/163393
Decision under appeal	Court or tribunal: Supreme Court Jurisdiction: Equity Citation: [2017] NSWSC 189 and [2017] NSWSC 520 Date of Decision: 9 March 2017 and 5 May 2017 Before: Emmett AJA File Number(s): SC 2016/210312