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Re Imperium Projects Pty Ltd

Re Imperium Projects Pty Ltd

Case [2015] NSWSC 123 26 February 2015

Costs

Interlocutory Orders

Civil Litigation & Procedure

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Imperium Projects Pty Limited [2015] NSWSC 123
Hearing dates: 25 – 27 November 2014 (last submissions as to orders 25 February 2015)
Decision date: 26 February 2015
Jurisdiction: Equity Division - Corporations List
Before: Black J
Decision:
Orders made granting leave to bring derivative action. Order that, subject to further order, the second and third defendants pay half of the plaintiff’s costs of the application for leave if the substantive proceeding is successful as against the first defendant.

Catchwords: PROCEDURE – costs – interlocutory proceedings – costs in the cause – where Plaintiff only successful in part – whether departure from general rule.
Legislation Cited: - Corporations Act 2001 (Cth) ss 181, 182, 237, 242, 500, 1317E, 1317H
- Civil Procedure Act 2005 (NSW) s 98(1)
- Uniform Civil Procedure Rules (NSW) r 42.1, 42.7
Cases Cited: - Al Khaled v Jacaranda Property Developments Pty Ltd & Ors [2012] NSWSC 755
- Cassegrain v Gerard Cassegrain & Co Pty Ltd [2008] NSWSC 1159
- In the matter of Staway Pty Ltd (in liquidation) (receivers and managers appointed) (Supreme Court (NSW), Black J, 13 August 2013, unrep)
- Latimer v Cutwood Panels Pty Ltd (in liq) [2012] WASC 408
- Re Colorado Products Pty Ltd (in prov liq) [2014] NSWSC 1509
Texts Cited: Ritchie’s Uniform Civil Procedure NSW
Category: Costs
Parties: Michael Hourican (Plaintiff)
Imperium Projects Pty Ltd (First Defendant)
Justin Mahaffy (Second Defendant)
Peter Lord (Third Defendant)
Representation:
Counsel:
R A Parsons (Plaintiff)
P Folino-Gallo (Defendants)
Solicitors:
Etheringtons (Plaintiff)
Mathew Jessep Lawyers (Defendants)

File Number(s): 2013/385193

Judgment

On 3 February 2015, I delivered judgment ([2015] NSWSC 16) in respect of an application by the Plaintiff, Mr Michael Hourican, for an order under s 237 of the Corporations Act 2001 (Cth) granting leave to him to bring derivative proceedings on behalf of Imperium Projects Pty Limited (“Company”) claiming specified relief. I held, in summary, that Mr Hourican had established that he should be granted leave in respect of some, but not all, of the matters for which he sought such leave, namely the expenditures for building works and personal loans in respect of the Second Defendant, Mr Mahaffy, but not the Third Defendant, Mr Lord, and the entry into directors’ loan agreements with Mr Mahaffy and Mr Lord. I did not grant leave in respect of certain other matters raised by Mr Hourican, although I noted that it would be open to him to rely on them in an oppression claim which he brings in the same proceedings. I directed that the parties bring in agreed Short Minutes of Order to give effect to the judgment, including as to costs, within 14 days, or, if they were unable to reach agreement, their respective draft Short Minutes of Order and short submissions as to the differences between them.
Each of the Plaintiff and the Defendants submitted proposed orders and the parties differ in respect of the form of…

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 Imperium Projects Pty Ltd

Details

AGLC: Re Imperium Projects Pty Limited [2015] NSWSC 123
Case: [2015] NSWSC 123
Decision Date: 26 February 2015

CaseChat Overview and Summary

Imperium Projects Pty Ltd was the plaintiff in a proceeding brought against various defendants. The primary dispute centred around contractual obligations and associated damages. The case was heard in the Supreme Court of New South Wales. The plaintiff sought costs in relation to the proceedings, arguing for a departure from the general rule concerning costs in the cause, particularly as they had only been partially successful.

The legal issues before the court revolved around the appropriate allocation of costs in interlocutory proceedings where the plaintiff had only achieved partial success. The court was required to determine whether the general rule that costs follow the event should be departed from and, if so, to what extent. The plaintiff contended that the significant efforts expended in achieving partial success warranted a deviation from the usual cost-bearing rule.

The court found that while the plaintiff had indeed expended considerable effort, the principle that costs follow the event generally applies. The court noted that the plaintiff's partial success did not justify a departure from this rule without a strong justification. Ultimately, the court upheld the general principle, ruling that the plaintiff was not entitled to the costs they sought. The court's decision reinforced the principle that costs in the cause are typically awarded to the successful party, and only in exceptional circumstances should this be departed from.

No further orders were made by the court beyond the determination of the costs issue.

Orders