Preston, in the matter of Sandalwood Properties Ltd (No 2)

In the matter of Sandalwood Properties Ltd (No 2), the court was required to consider the costs incurred in relation to an application for directions made by receivers under section 424 of the Corporations Act 2001 (Cth). The dispute arose from the contentions of an intervener, SGCL, regarding the form of the directions to be given by the court. The legal issues before the court included whether the intervener's participation was adversarial in nature and, if so, whether the ordinary rule that costs should follow the event applied. The court also needed to determine the principles governing costs in cases of intervention by a party who was not a direct party to the proceedings.

The court found that the intervener's participation in the proceedings was adversarial in character. SGCL intervened to advance the position of the Growers, who were its members, against the receivers in the management of the schemes. The court noted that the intervener's submissions were based on the commercial interests of the parties rather than on what was best for the administration of the receivership. This was contrasted with cases where interveners assist the court in resolving complex legal issues. The court held that the underlying question in the proceedings was whether it was appropriate for the receivers to proceed with the management of the sandalwood trees and other services under the agreements during the receivership. The intervener's position was not limited to the practicalities faced by the receivers in taking urgent steps. Consequently, the court applied the ordinary rule that costs should follow the event, ordering the intervener to pay the receivers' costs of $66,532.80 plus GST.