TRENT MARSHALL MCKENDRICK (& Anor according to the attached schedule of parties)	First plaintiff
v
CREDIT CLEAR LIMITED (FORMERLY CREDIT CLEAR PTY LTD) (ACN 604 797 033) (& Ors according to the attached schedule of parties)	First defendant

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JUDGE:	Gardiner AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	17 February 2021
DATE OF JUDGMENT:	21 May 2021
CASE MAY BE CITED AS:	Re Credit Clear Ltd
MEDIUM NEUTRAL CITATION:	[2021] VSC 287

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CORPORATIONS – Security for costs – Claim by plaintiffs in respect of alleged oppressive conduct – Impecunious corporate plaintiff – Natural person co-plaintiff – Corporate plaintiff trustee of a trust – Co-plaintiff and beneficiary of the unit trust not prepared and says not able to provide security – Impecuniosity of the natural person plaintiff not established – Whether claims of plaintiffs “overlapped” – Security ordered – Supreme Court (General Civil Procedure) Rules 2015, r 60.02 – Corporations Act 2001 (Cth), s 1335(1) – Colmax Glass Pty Ltd v Polytrade Pty Ltd [2013] VSC 311.

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APPEARANCES:	Counsel	Solicitors
For the Second plaintiff	Mr S Rubenstein	Marshalls & Dent & Wilmoth
For the Defendants	Mr T North QC with Mr E Batrouney	Deutsch Miller

HIS HONOUR:

By summons filed 25 November 2020, the defendants seek an order for security for their costs pursuant to r 60.02 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘the Rules’), alternatively s 1335(1) of the Corporations Act 2001 (Cth) (‘the Act’), against the second plaintiff, ACN 604 594 621 (formerly known as C Capital Pty Ltd) (‘Capital’). The defendants seek that Capital provide security for their costs of $351,314.35, for the period of up to and including the first day of trial.[1]
[1]On 3 February 2021, the solicitors for the defendants wrote to the plaintiffs making an open offer to accept security for their costs up to and including the first day of trial of $195,174.65. That offer expired at 4pm on 9 February 2021.

The defendants rely on the affidavits of Shane Nicholas Anderton affirmed 26 November 2020 (‘First Anderton Affidavit’) and 29 January 2021 (‘Second Anderton Affidavit’), together with affidavits of a costs consultant retained by the defendants, Christopher John Grisenti, sworn 25 November 2020 (‘First Grisenti Affidavit’) and 29 January 2021 (‘Second Grisenti Affidavit’).

In opposing the application, Capital relies on the affidavits of the first plaintiff, Trent McKendrick, sworn 15 July 2020 (‘First McKendrick Affidavit’), 21 December 2020 (‘Second McKendrick Affidavit’) and 16 February 2021 (‘Third McKendrick Affidavit’) together with an affidavit of Penelope Jane van den Berg, a costs lawyer, sworn 21 December 2020.

Background

The first defendant, Credit Clear Limited (formerly Credit Clear Pty Ltd) (‘Credit Clear’), is involved in the development of financial technology. It was originally incorporated as a proprietary limited company but became a…

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.

Continue reading Re Credit Clear Ltd

Details

AGLC: Re Credit Clear Ltd [2021] VSC 287
Case: [2021] VSC 287
Decision Date: 21 May 2021

CaseChat Overview and Summary

Credit Clear Ltd brought an action against several defendants in the Supreme Court of Victoria, alleging oppressive conduct and seeking various remedies. The plaintiff was described as an impecunious corporate entity, and the action was brought on behalf of a unit trust of which Credit Clear Ltd was the trustee. The natural person plaintiff was also a beneficiary of the trust. The defendants sought an order for security for costs, arguing that the plaintiffs were unable to pay such costs if awarded. The plaintiffs contended that they were unable to provide security due to their financial situation.

The court considered whether the claims of the plaintiffs overlapped to the extent that they could be consolidated and, if so, whether the natural person plaintiff was impecunious. The court examined the plaintiffs' ability to pay costs, considering the financial situation of both Credit Clear Ltd and the natural person plaintiff. The court noted that the natural person plaintiff had not established their impecuniosity, and the claims of the plaintiffs did not overlap to the extent necessary for consolidation.

The court ordered that the plaintiffs provide security for the defendants' costs, finding that the plaintiffs were not impecunious and that their claims did not overlap to the extent that they could be consolidated. The court emphasised the importance of the plaintiffs' ability to pay costs and the need for security to protect the defendants' rights. The court made an order that the plaintiffs provide security for costs in the amount of $50,000.

Orders