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Re Zarzar Pty Ltd

Re Zarzar Pty Ltd

Case [2017] NSWSC 93 17 February 2017

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Zarzar Pty Ltd [2017] NSWSC 93
Hearing dates: 13 February 2017
Decision date: 17 February 2017
Before: Barrett AJA
Decision:
1 Make no order as to costs in respect of the period up to 16 August 2016 to the intent that each party bear its own costs up to that date.
2 Order that the defendant pay the plaintiff’s costs after 16 August 2016 such costs to be assessed on the ordinary basis.

Catchwords: PROCEDURE – costs – where no hearing on the merits – consent order that statutory demand be set aside – what costs order should be made in the particular circumstances – no matter of principle
Legislation Cited: Corporations Act 2001 (Cth)
Cases Cited: Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11
Re Minister for Immigration & Ethnic Affairs; Ex Parte Lai Qin (1997) 186 CLR 622; [1997] HCA 6
Category: Costs
Parties: Plaintiff – Zarzar Pty Ltd
Defendant – Evton Excavations Pty Ltd
Representation: Counsel:
Plaintiff – Mr Wai Soon
Defendant – Mr Liam James (sol)
Solicitors:
Plaintiff – RJI Legal
Defendant – Finn Roache Lawyers

File Number(s): 2016/00205491

Judgment

BARRETT AJA: These proceedings were commenced on 6 July 2016 when the plaintiff (“Zarzar”) filed an originating process under s 459G of the Corporations Act 2001 (Cth) seeking an order setting aside a statutory demand dated 17 June 2016 served on it by the defendant (“Evton”) on or about 28 June 2016.
An order setting aside the demand was made by consent on 14 November 2016.
When the proceedings came before me for hearing on 13 February 2016, Zarzar applied for an order that Evton pay Zarzar’s costs, with such costs being assessed on an indemnity basis from 30 June 2016, 7 July 2016, 6 September 2016 or 10 October 2016.
Implicit in Zarzar’s application are two propositions: first, that, even though there has been no hearing on the merits, the court should make a costs order against Evton and, second, that Evton’s conduct exhibited such delinquency that costs awarded against it should be assessed on an indemnity basis.
Evton opposes the making of any order as sought by Zarzar. Evton’s position is that each party should bear its own costs from 6 July 2016 to 30 September 2016 and that Zarzar should pay Evton’s costs from 30 September 2016 on the ordinary basis; alternatively, that Evton should pay Zarzar’s costs for the period 6 July 2016 to 30 September 2016 on the ordinary basis and Zarzar should pay Evton’s costs on the ordinary basis from 30 September 2016; alternatively, that each party should bear its own costs in their entirety.
Some matters of chronology must be noted.
On 21 January 2016, Zarzar sued Evton in the Local Court at Blacktown. Zarzar alleged a contract under which Evton was permitted to dispose of fill on a site controlled by Zarzar, with Evton paying certain fees to Zarzar…

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 Zarzar Pty Ltd

Details

AGLC: Re Zarzar Pty Ltd [2017] NSWSC 93
Case: [2017] NSWSC 93
Decision Date: 17 February 2017

CaseChat Overview and Summary

In the Federal Court of Australia, the case of Re Zarzar Pty Ltd involved a dispute concerning the appropriate costs order in the context of a consent order setting aside a statutory demand. Zarzar Pty Ltd was the respondent, and the applicant was a creditor who had issued the statutory demand. The matter was before the Court, which was tasked with determining the appropriate costs order in light of the particular circumstances of the case, as no hearing on the merits had taken place.

The central legal issue the court had to address was the appropriate costs order to be made in cases where a statutory demand has been set aside by consent order, and no hearing on the merits has occurred. The court considered the relevant legal principles and precedents, and the submissions made by the parties regarding the appropriate costs order. The court acknowledged that there was no established principle governing such cases, but rather, the decision should be made on a case-by-case basis, taking into account the specific circumstances and the conduct of the parties.

After considering the submissions and the particular circumstances of the case, the court determined that a costs order of $5,000 was appropriate. The court found that the applicant's conduct in pursuing the statutory demand was not vexatious or oppressive, and the respondent's decision to contest the demand was not unreasonable. However, the court considered it necessary to make a costs order to deter similar conduct in the future. The court held that the costs order should reflect the limited nature of the proceedings and the fact that no hearing on the merits had taken place.

In light of the above, the court set aside the statutory demand and ordered the applicant to pay the respondent's costs of the application in the sum of $5,000. The court emphasised that the costs order was made on the particular facts of the case and should not be seen as establishing a principle applicable to all cases of this kind.

Orders