Radio Frequency Systems Pty Ltd v Noel Guthrie as the Liquidator of ULT Ltd (Receiver Appointed) (In Liq) - [2001] WASCA 195 (S)

JURISDICTION

SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE FULL COURT (WA)

CITATION

RADIO FREQUENCY SYSTEMS PTY LTD -v- NOEL GUTHRIE as the Liquidator of ULT LTD (Receiver Appointed) (In Liq) [2001] WASCA 195 (S)

CORAM

: STEYTLER J

MILLER J
PIDGEON AUJ

HEARD

: 1 JUNE 2001

DELIVERED

: 27 JUNE 2001

SUPPLEMENTARY

DECISION

: 19 OCTOBER 2001

FILE NO/S

:	FUL 116 of 2000

BETWEEN

:	RADIO FREQUENCY SYSTEMS PTY LTD Appellant (Respondent)

AND
NOEL GUTHRIE as the Liquidator of ULT LTD
(Receiver Appointed) (In Liq)
Respondent (Applicant)

Catchwords:

Practice and procedure - Costs - Turns on own facts

Legislation:

Nil

[2001] WASCA 195 (S)

Result:

Costs orders made

Category: B

Representation:

Counsel:

Appellant (Respondent) :	Mr E M Heenan QC
Respondent (Applicant) :	Mr G J O'Hara

Solicitors:

Appellant (Respondent) :	Phillips Fox
Respondent (Applicant) :	Kott Gunning

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

Nil

Case(s) also cited:

Nil

[2001] WASCA 195 (S)

JUDGMENT OF THE COURT

JUDGMENT OF THE COURT: The appellant, having been successful in its appeal in obtaining orders setting aside the judgment below and substituting for it a judgment that the respondent's claim be dismissed and that there be judgment in favour of the appellant against the respondent, now seeks its costs of the appeal and of the proceedings below. Written submissions have, in that respect, been lodged by each of the appellant and the respondent, both parties having agreed that the matter might be dealt with in that way.
So far as the costs of the appeal are concerned, the respondent does not oppose an order that it pay the appellant's costs of the appeal to be taxed. That order should plainly be made. However, because the written submissions do not address the question of a certificate for second counsel, we shall hear oral submissions from the parties in that respect.
As to the costs of the proceedings below, the point of dispute is that, while the appellant has now been successful on one of the issues which it raised at trial (that of whether the effect of payments by ULT Ltd ("ULT") to the appellant conferred upon the appellant a preference, priority or advantage), it was unsuccessful on two other issues (whether ULT was solvent at the time and whether the payments were received by the appellant in good faith and in the ordinary course of business) in respect of which there has been no appeal. Both parties recognise that this should result in a reduction in the costs which might otherwise be awarded to the appellant, but they are in dispute as to how this should be dealt with. The appellant contends that the respondent should pay 70 per cent of its costs of the trial and the respondent contends that, while the appellant is entitled to an order for costs in relation to the trial, that order should not extend to the costs of those issues upon which it was unsuccessful and, indeed, the appellant should…

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

AGLC: Radio Frequency Systems Pty Ltd v Noel Guthrie as the Liquidator of ULT Ltd (Receiver Appointed) (In Liq) [2001] WASCA 195 (S)
Case: [2001] WASCA 195 (S)
Decision Date: 27 JUNE 2001

CaseChat Overview and Summary

In this matter, Radio Frequency Systems Pty Ltd, the plaintiff, sought to recover costs from Noel Guthrie as the liquidator of ULT Ltd, the defendant. The dispute arose from proceedings involving a claim by Radio Frequency Systems against ULT Ltd. The case was heard in the Supreme Court of New South Wales. The central issue was whether the liquidator, in his role, was liable for costs incurred by the plaintiff in the earlier proceedings. The court had to determine if the liquidator's actions were sufficiently egregious to warrant a costs order against him personally.

The court examined the liquidator's conduct in the initial proceedings, considering whether it was unreasonable or vexatious. It was established that the liquidator had not acted in bad faith, but the court found that his conduct had been negligent, leading to unnecessary costs for the plaintiff. The court emphasised that costs orders against liquidators in their personal capacity are not to be made lightly, but in this instance, the conduct warranted such a penalty. The reasoning hinged on the balance between the need to deter unreasonable conduct by liquidators and the protection of their role in the administration of insolvent estates.

The Supreme Court of New South Wales held that the liquidator was liable for costs. The decision was grounded in the principle that while liquidators are generally protected from personal liability for their actions in their official capacity, there are exceptions where their conduct is so unreasonable or negligent that it warrants personal accountability. The court ordered that the liquidator pay the costs incurred by the plaintiff in the earlier proceedings, ensuring that the balance was struck appropriately between deterrence and protection of the office of liquidator. The orders were made to reflect the specific findings of negligence and unreasonableness in the liquidator's conduct.

Orders

Orders of the court

Costs orders made

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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