Royal Fresh International Pty Ltd v Nutracare Life Sciences Pty Ltd (in liq) as Trustee for the Nutracare Life Sciences Unit Trust
[2019] VCC 553
•29 April 2019
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-17-03920
| ROYAL FRESH INTERNATIONAL PTY LTD | Plaintiff |
| v | |
| NUTRACARE LIFE SCIENCES PTY LTD (IN LIQ) AS TRUSTEE FOR THE NUTRACARE LIFE SCIENCES UNIT TRUST | Defendant |
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JUDGE: | HIS HONOUR JUDGE COSGRAVE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 21 March and 10 April 2019 | |
DATE OF RULING: | 29 April 2019 | |
CASE MAY BE CITED AS: | Royal Fresh International Pty Ltd v Nutracare Life Sciences Pty Ltd (in liq) as Trustee for the Nutracare Life Sciences Unit Trust | |
MEDIUM NEUTRAL CITATION: | [2019] VCC 553 | |
REASONS FOR RULING
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr P Clarke | Celtic Legal |
| For the Non-Parties | Mr J Castelan | Tisher Liner FC Law |
HIS HONOUR:
Nature of application
1 By summons filed 22 February 2019, the plaintiff (“RFI”) applied for an order against Mark and Steven Lipshut that they pay RFI’s costs of and incidental to this proceeding, such costs to be taxed on an indemnity basis.
Background
2 On 22 September 2014, the defendant (“NLS”) was incorporated. Its directors were Mr Mark Lipshut and Mr Steven Lipshut.
3 On about 22 November 2016, RFI and the defendant (“NLS”) entered into an agreement for the supply of 30 containers of grapes. According to the statement of claim, RFI was to pay NLS a deposit of $150,000 for the supply of the goods. The goods would be despatched over a period of several weeks. The weekly sale price of the goods would be agreed between the parties on a weekly basis prior to the supply of the goods. If the parties were unable to agree, the defendant would refund the deposit.
4 On about 24 November 2016, RFI paid NLS $150,000.
5 In late April 2017, RFI requested a refund of the $150,000 deposit because the parties could not agree upon the sale price. NLS agreed to refund the deposit.
6 On 9 June 2017, NLS repaid $30,000 to RFI.
7 On 29 June 2017, Steven Lipshut emailed David Yang, a director of the plaintiff, apologising for the delay in returning the funds. He said that the defendant was waiting on funds which were overdue but were expected within seven days.
8 On about 19 July 2017, RFI issued a letter of demand to NLS. Notwithstanding the demand, NLS made no further payments to RFI.
9 On 24 August 2017, RFI issued the writ and statement of claim in this proceeding.
10 On 20 October 2017, NLS filed a defence to the statement of claim.
11 On 20 November 2017, the Court made orders by consent setting the proceeding down for trial on 21 May 2018.
12 On 6 March 2018, Nutracare Australia Pty Ltd was incorporated. Mr Mark Lipshut and Mr Steven Lipshut were appointed directors on the same day. The company had 28,430,000 fully paid $1 shares. All the shares in the company were owned by NLS.
13 On 22 March 2018, NLS quit its shareholding in Nutracare Australia. On the same day, VBS Investments Pty Ltd took up 11.5 million shares and LP Corporate Pty Ltd also became the beneficial holder of 11.5 million shares.
14 On 24 April 2018, the trial schedule for May 2018 was vacated and the trial was refixed for hearing on 31 October 2018. The initial trial date was lost because RFI failed to pay the setting down fee.
15 On 18 May 2018, Steven Lipshut swore an affidavit of documents on behalf of NLS in this proceeding.
16 On 22 June 2018, the parties engaged in a mediation at the offices of NLS’ solicitor, Tisher Liner FC Law (“Tisher Liner”).
17 On 25 June 2018, Tisher Liner filed a change to company details on behalf of NLS notifying ASIC of a change to the share structure and shareholder. VBS Investments Pty Ltd was divested of its shares in NLS.
18 On 14 September 2018, NLS notified ASIC of a resolution to change the company’s name to 601955284 (NLS) Pty Ltd.
19 On 17 September 2018, RFI filed a supplementary affidavit of documents in the proceeding.
20 On 19 October 2018, the plaintiff’s solicitor received an email from Tisher Liner advising that they had recently made an application to the Court to cease acting on behalf of NLS and that such application was listed for a directions hearing on 22 October 2018. At that directions hearing, Judicial Registrar Burchell granted leave to Tisher Liner to cease acting on behalf of NLS.
21 Later, on 22 October 2018, RFI’s counsel, who had attended the directions hearing, advised Claire King, the plaintiff’s solicitor, that at the directions hearing, Steven Lipshut advised the Court that NLS would be going into voluntary administration some time later that week.
22 On 23 October 2018, Steven Lipshut wrote to Claire King confirming that NLS would be placed in the hands of external administration later that week. He said that the company had no funds to cover costs and that the shareholders would not inject any further funds for the purposes of conducting a County Court trial. He said that, “the company has not traded for a significant period of time.” The letter also contained an offer to the plaintiff. Further, Mr Lipshut said that whether or not the offer was accepted, “the company will still be wound up. That has been the intention for over a year.”
23 On 29 October 2018, NLS went into liquidation. On the following day, RFI advised the Court that the trial scheduled for 31 October could not proceed.
24 On 10 December 2018, RFI’s solicitor wrote to the Court and the non-parties advising that RFI intended to apply for a special costs order against the former directors of the defendant company now in liquidation, namely Mark and Steven Lipshut. This was consistent with a prior communication by RFI’s solicitor to Mark and Steven Lipshut on 26 October 2018.
25 In January 2019, the liquidators of NLS released their final report to creditors. In that report, the liquidator noted that he had been provided with what he believed to be the totality of the company’s books and records. His preliminary assessment was that the company did not maintain adequate written records in compliance with its obligations under section 286 of the Corporations Act 2001 (Cth). The liquidator observed that NLS appeared to have been the former legal and beneficial owner of 23 million fully paid shares in Nutracare Australia. He said that further investigations were required to establish the source of funds used to acquire the shares (which had a total issue price of $23 million), disposal details and how the company dealt with the sale proceeds, if any.
Legal principles
26 In dealing with the application by RFI, the legal principles are reasonably clear.
27 In making its application, RFI relies primarily upon the decision of the High Court in Knight v FP Special Assets Limited.[1] These principles were recently examined in some detail by the Victorian Court of Appeal in Gdanski v Palms Court Management Pty Ltd.[2] There, the court noted:[3]
“The making of an order for costs against a non-party is an exceptional course for a court to take. The usual order, of course, is that the losing party pays the successful party’s costs of the proceeding. There are, however, recognised sets of circumstances in which express provisions authorise, or the interests of justice require, the making of a non-party order for costs. Naturally, such an order can only be made if the circumstances of the case satisfy the conditions laid down for the exercise of the relevant power.”
[1](1992) 174 CLR 178.
[2][2017] VSCA 348.
[3]Ibid at [1].
28 The court did not take issue with the trial judge’s summary of the applicable principles decided in Knight and later authorities applying that case. Knight identified a well-established category of case where a court has discretion to make a non-party costs order. Mason CJ and Deane J said:[4]
“For our part, we consider it appropriate to recognise a general category of case in which an order for costs should be made against a non-party and which would encompass the case of a receiver of a company who is not a party to the litigation. That category of case consists of circumstances where the party to the litigation is an insolvent person or man of straw, where the non-party has played an active role in the conduct of the litigation and where the non-party, or some person on whose behalf he or she is acting or by whom he or she has been appointed, has an interest in the subject of the litigation. Where the circumstances of a case fall within that category, an order for costs should be made against the non-party if the interests of justice require that it be made.”
[4]Knight (1992) 174 CLR 178, 192-3.
29 So, the power to make a non-party costs order can arise where:
·a named party is insolvent;
·the non-party played a sufficiently active role in the conduct of the litigation;
·the non-party has a sufficient interest in the litigation;
·the interests of justice require it.
30 In other words, for the Knight category to be applicable, there is a threshold requirement that the non-party is a real party to the litigation. This requires that the party be actively involved and personally interested in the proceeding. It is the combination of these two requirements which enlivens the court’s jurisdiction to consider making an order against a non-party for the costs of the successful party. Unless the non-party can be properly characterised as a real party to the litigation, no question of the interests of justice or of exceptional circumstances arises and it cannot be appropriate to make a costs order against such a non-party.
31 The discretion to make a costs order against a non-party is to be exercised with considerable caution. The discretion is to be exercised judicially and in accordance with general legal principles pertaining to the law of costs. Ultimately, the enquiry will depend upon the facts of each particular case.
32 The mere fact that a director causes an insolvent company to either bring or defend legal proceedings is insufficient of itself to justify a non-party cost order under the Knight principle. Something more is required to justify such an order. As explained in Gdanski, the Knight principle applies where recourse to the losing party is unavailable because it is insolvent and the non-party can be seen to have substantively contributed to the claim or defence in pursuit of the non-party’s own interests such that the non-party was a real party to the proceeding.
33 In assessing whether a director has been actively involved in the litigation in the requisite sense, it is necessary to acknowledge that a company is an artificial legal entity which must, of necessity, act through the agency of natural persons. The fact that a sole director and shareholder was the prime decision-maker in the company’s litigation is not sufficient to establish that the director was a real party to the litigation in the necessary sense. As Muir J explained in Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd:[5]
“In my view the mere fact that a person is the sole director and shareholder of an unsuccessful litigant corporation will not, without more, suffice to justify a costs order against that person. And that is so even if the person was the corporation’s sole, principal or ultimate decision maker in relation to the litigation.
To conclude otherwise would be to ignore the principle that costs orders against non-parties are “exceptional” and ought be made only if appropriate in the interest of justice. The control of a corporate litigant by a director who is also its sole or majority shareholder is an unremarkable occurrence. It is sanctioned by a long established legislative framework which recognises that a company has an independent legal personality distinct from that of its members and that neither members nor directors, as a general proposition, are personally liable for its acts and defaults.”
[5][2004] QSC 47 at [12]-[13]. This passage was quoted with approval by the Court of Appeal in Gdanski at [43].
34 In assessing a director’s conduct, it is also important to recognise that when a company director plays an active role in litigation involving the company, this may be entirely consistent with the director’s fiduciary duty to the company.
35 The courts have exhibited a general concern to avoid undermining principles of limited liability. Accordingly, the mere fact that a non-party is a sole director and shareholder of a corporate litigant does not of itself attract the Knight principle. If this were not so, the corporate veil would effectively be nullified at the very point where it provides protection against personal liability for shareholders and directors. Thus, the simple fact that a shareholder has an indirect interest in the success of a company’s litigation does not mean that the Knight exception for costs orders is applicable.
36 Similarly, the mere fact that a creditor, which might include a director who lent money to the company, has an indirect interest in the success of a company’s litigation does not mean that the Knight exception applies. Relevant factors in this context include the existence of other creditors of the company and the amount of the indirect benefit which the creditor might receive from successful litigation.
37 In Baker’s Investment Group (Australia) Pty Ltd v Caason Investments Pty Ltd,[6] the court held that there are a number of factors relevant to the exercise of the court’s discretion in determining an application for costs against a non-party. The factors include:
[6][2015] VSC 644.
(a) the extent to which the non-party has funded the litigation;
(b) the extent to which the non-party has a real interest in the fruits of the litigation if the assisted party were successful;
(c) the level of control the non-party exercised, or was entitled to exercise, over the conduct of the litigation, including its resolution;
(d) whether or not the non-party attended any mediation of the dispute;
(e) the financial position of the assisted party;
(f) whether the conduct of the litigation by the assisted party, or, if applicable, the funding non-party, in either prosecuting or defending a claim, was unreasonable, improper or an abuse of process;
(g) whether a timely warning was given by the successful party to the non-party that costs would be sought against it; and
(h) the extent of the impact on the court of the involvement of the non-party.
38 I infer from the submissions filed that the essence of RFI’s claim was that:
(a)the non-parties deliberately concealed the winding down of the NLS business and the removal of substantial assets over a lengthy period of time.
(b)in circumstances where the non-parties knew from around mid-2017 to October 2017 that NLS was not trading and was intended to be wound up, they deliberately, and for ulterior purposes, withheld the true financial position of NLS from the plaintiff and its solicitors until 29 October 2018 when NLS went into liquidation.
(c)had NLS or the non-parties informed RFI earlier of the true state of affairs regarding NLS, RFI would not have incurred so much in the way of unrecoverable costs.
39 In response, NLS contended that:
(a)the circumstances of the case were not sufficiently exceptional to warrant the kind of order sought by RFI.
(b)there was no obligation upon NLS or the non-parties to reveal the changes in relation to the shareholding in NLS.
(c)there was no deliberate concealment of the winding down of the business of NLS. The situation was said to be markedly different from that found in the authorities relied upon by RFI, namely, Murphy v Mackay Labour Hire Pty Ltd[7] and Total Spares & Supplies Ltd v Antares SRL.[8]
[7][2018] QCA 90.
[8][2006] EWHC 1537.
40 A particular area of dispute was the mediation between the parties in June 2018. NLS complained that RFI sought to misrepresent its position to the Court by ignoring what it was informed of at the mediation. As a result, I adjourned the initial hearing and allowed the parties to file more material. The parties agreed that each could file and rely upon evidence regarding what took place at the mediation.
41 NLS filed an affidavit asserting that:[9]
“At all material times following the conclusion of the mediation the plaintiff was aware that the defendant was not, and had not been, trading and had no assets.”
[9]Affidavit of Phoebe Langridge, sworn 7 March 2019, at paragraph 20.
42 In a second affidavit from the non-parties’ solicitor, Phoebe Langridge, sworn 28 March 2019, she claimed that at the mediation:
(a)counsel for the plaintiff was informed that the defendant had not been trading for some time and that it had no assets.
(b)she was informed by the mediator or RFI’s counsel that the plaintiff had left the mediation because its director, Mr Yang, wished to undertake his own investigations regarding the defendant’s financial position.
43 I note in passing that RFI raised a series of objections to various paragraphs in Ms Langridge’s affidavit material. I accept that a number of the objections were justified because the deponent included material which was argumentative, conclusory or otherwise inadmissible. I have focussed my attention only upon the relevant and admissible parts of the affidavit material.
44 Mr Richardson, counsel for RFI at the mediation, filed an affidavit in which he deposed that:
(a)shortly after the mediation commenced, Mr McFarlane, the mediator, advised him that the defendant had some information which would probably shorten the duration of the mediation.
(b)he met with Mr McFarlane and Ms Langridge where the defendant’s current financial situation was mentioned. Ms Langridge said that the defendant could not make any offer other than both parties walk away and bear their own costs.
(c)he asked Ms Langridge whether she had any of the NLS financials or other documentation which would support what she said. He asked whether there were any judgments, statutory demands or other claims against NLS that she was aware of. Ms Langridge said she was not aware of any other judgments or claims.
(d)Ms Langridge subsequently obtained instructions to show Mr Richardson a document entitled “Balance Sheet”. Mr Richardson was allowed to examine the document but could not photocopy it or take it out of the room to show his client. The document comprised two A4 pages stapled together. They recorded current assets totalling $250,739 and liabilities exceeding $3 million. The document contained no reference, logo or markings from an accountancy firm and was not signed.
(e)Mr Richardson said that he had no recollection of being told during the mediation that NLS had ceased trading or that it was the intention of the directors to have the company wound up.
45 No party applied to cross-examine any of the deponents in this case. However, from the material filed, it was common ground that:
· RFI’s counsel was aware that NLS claimed to be in financial difficulty, was unlikely to retain Tisher Liner beyond the mediation, and was not in a position to make any substantive offers at the mediation; and
· the “balance sheet” document showed about $251,000 in total current assets and liabilities exceeding $3 million.
46 If taken at face value, these matters suggested that NLS was in financial difficulties and faced an uncertain future. From NLS’ viewpoint, the significance of these matters was that they called into serious question the allegation that NLS had deliberately withheld details of its financial position from RFI until 29 October 2018. Indeed, there was a “without prejudice” email from Steven Lipshut dated 23 October in which he wrote:
“… you will be aware from my statements to the Registrar yesterday and undoubtedly conveyed by counsel, that the company will be placed in the hands of external administration (sic) this week … Quite simply, the company has no funds to cover costs let alone anything else, and the shareholders will not inject any further funds for the purpose of conducting a County Court trial. Indeed the company has not traded for a significant period of time. …
In all cases, offer accepted or not, the company will still be wound up. That has been the intention for over a year.”
47 On the material, one could reasonably find that RFI had overstated its case because it should have been aware from the mediation in June 2018 that the financial position of NLS was problematic. RFI relied upon the concept of deliberate concealment by the non-parties to justify the costs order sought against them. RFI referred to the cases mentioned above.
48 In Murphy’s case,[10] Mr Murphy appealed against a non-party costs order made against him regarding proceedings involving a company of which he was the sole director. The proceedings did not proceed to judgment because, after the hearing of the evidence at the trial, the company went into liquidation. The trial judge, whose judgment was upheld, referred to the factual background to the case:[11]
[10][2018] QCA 90.
[11]Ibid at [9].
· Mr Murphy, in addition to being the sole director and secretary of the defendant and the nominee for the defendant’s building licence, was also the sole director and secretary of Murphy International Pty Ltd and JM Kelly Group of Companies Pty Ltd.
· Mr Murphy’s building licence was used for JM Kelly Group of Companies Pty Ltd as well as related companies.
· On 9 June 2016, all three companies changed their names by resolution. (The new names did not reference Kelly or Murphy or construction.)
· On 10 June 2016, the Friday before the commencement of the trial on the following Monday, the name changes for two of the companies, Murphy International Pty Ltd and JM Kelly Group of Companies Pty Ltd, were registered with ASIC but not for the defendant.
· Also on 10 June 2016, Mr Murphy executed a series of detailed deeds transferring the productive resources and contracts of the defendant to a related company. There were separate deeds for the sale of assets and the transfer of employees and construction contracts to JM Kelly Builders Pty Ltd.
· On 20 June 2016, Mr Murphy made a resolution to wind up the defendant.
· The liquidator’s report (exhibited to the affidavit of Mr Naylor) indicated that the defendant had ceased business on 17 June 2016 (two days after the evidence closed), which was also the day the defendant’s change of the name was lodged.
· Upon the liquidation of his companies, Mr Murphy was disqualified by law from further acting as nominee for any building company. The Queensland Building and Construction Commission (the QBCC) was notified of a change of nominee for JM Kelly Builders Pty Ltd on the day that the defendant’s name change was registered.
· The firm of solicitors used to register the name change for all three companies and prepare the deeds was different to the solicitors representing the defendant at trial.
49 The defendant ceased business on 17 June 2016, two days after the close of business. At the time, it had three construction contracts. The deeds for the assumption of employees, assets sales and construction contracts were executed before the liquidators were appointed. The liquidators’ report included a summary of the defendant’s affairs which represented that, as at 20 June 2016, the defendant company had debts of $4.5 million and assets worth less than 10% of that sum. The trial judge noted the defendant’s contention that Mr Murphy was the person behind the defendant and that, at some time before 9 June 2016, he decided to wind up the defendant. He actively concealed that fact from the respondent and left it to expend further legal costs on a claim which would be unenforceable and in defence of a counterclaim.
50 Antares[12] concerned a long-term franchise agreement between Antares as franchisor and Total Spares & Supplies as franchisee for the sale distribution of wholesale plumbing parts. Total sued for damages for wrongful termination. Antares relied on certain alleged breaches to justify the termination. It raised a counterclaim but the trial judge said that this was not a significant element at the trial.[13]
[12]Total Spares & Supplies Ltd v Antares SRL [2006] EWHC 1537.
[13]Ibid at [2].
51 The action commenced in late September 2002. The trial commenced in May 2004 and continued for 22 days during May, June and early July 2004. The trial judge gave judgment in November 2004. His Honour held that Total had committed some breaches of the agreement but none of them entitled Antares to terminate the agreement without notice. Antares was obliged to give six months’ notice. Antares was held liable for six months’ loss of profit amounting to about £13,300. His Honour said that if Antares had not been entitled to give any notice of termination, Total’s damages would have been £348,950.
52 About two weeks before the start of the trial, Antares transferred its distribution business and related assets and liabilities to an Italian company called AWF. This was incorporated on 29 March 2004. The transfer occurred pursuant to a written agreement made on 21 April 2004 and registered with the Italian authorities in May 2004. The agreement provided for the transfer of the assets of the Antares “business branch”. The total value attributed to the transferred assets was approximately €4.621 million. AWF assumed liabilities of approximately €4.603 million, leaving a net asset value of €18,000 to be paid in cash.
53 The shares in AWF were held equally by Francesco Gargani’s son, Maurizio, and his wife Dr Enrica Mattolini. Francesco indirectly owned 90% of the shares in Antares, managed its business and controlled the company. His wife was a director. Others involved with Antares included Maurizio Gargani and Robert Piccione, who was engaged as a consultant. Dr Mattolini, Maurizio and Mr Piccione were the directors of AWF.
54 During the trial, the defendants made no mention of the business transfer or of the existence of AWF even though Mr Gargani, Dr Mattolini and Mr Piccione all gave evidence. There was no indication that Antares was not still conducting its business.
55 In early July 2004, shortly after the conclusion of the trial, the plaintiffs became aware of the incorporation of AWF and that it was apparently carrying on the plumbing and distribution business from the former business premises of Antares. The claimants were unaware of the business transfer agreement until September 2004.
56 In the circumstances, the trial judge ordered that Francesco Gargani pay 55% of the claimant’s costs of the proceeding. The judge considered him responsible for the transfer to AWF and had no doubt that he instigated it. The judge found that Gargani misled the Court and the claimant, and concealed the merger from the Court. The combination of various actions taken by him deprived the claimant of any realistic opportunity of recovering costs.
57 The case before me is different from the above cases to the extent that, according to the defendant and the liquidator, NLS did not have a profitable ongoing business at the time of trial. Indeed, the business formerly conducted by NLS had ceased by about October 2017. While the non-parties did not inform RFI before June 2018 of the financial position of NLS, and further, did not reveal the change in shareholding at Nutracare Australia, they did not seek to transfer a successful business from one company to another entity in order to protect that business from the potential consequences of the litigation.
58 In my experience, it is common in commercial litigation for a plaintiff’s legal representatives to query whether a prospective defendant is “worth powder and shot”. There is normally no utility in a litigant incurring legal costs to pursue a defendant that cannot satisfy a judgment. This is an everyday risk of commercial life.
59 The situation with the shareholding change in Nutracare Australia is not of such a kind as to render it exceptional. NLS was the owner of the shares only for a limited time in March 2018. The cessation of NLS’ shareholding in Nutracare Australia and the introduction of about 42 other shareholders in the company rather suggests that there was a genuine commercial purpose being served by the transaction during March/April 2018. It was not simply a case of the non-parties trying to frustrate RFI’s attempts to recover money owing to it. Moreover, NLS did not hold the shares in Nutracare Australia when RFI began the proceeding.
60 In the present case, the non-parties have been involved in the litigation. However, I am not satisfied that they have been the real parties to the litigation. Rather, they are and have been since September 2014 directors of the defendant. To that extent, they have fiduciary obligations to the company to act in its best interests. That can include defending legal proceedings where that is appropriate. Because the defendant was simply a defendant and raised no counterclaim, the optimal outcome for the defendant was the dismissal of the proceeding.
61 The non-parties, as directors, had some involvement in the litigation. Steven Lipshut attended the mediation and swore an affidavit of discovery for the company. I infer that the directors made decisions for the company in connection with the litigation. From what I saw, the defendant’s conduct of the litigation was consistent with the usual conduct of a defendant in such a case. I would not characterise the behaviour of the litigants or non-parties as unreasonable, improper, or an abuse of process. Indeed, the plaintiff’s counsel accepted that this piece of litigation was “responsibly run”. It appears from the affidavit material that the plaintiff gave no intimation of its intention to seek a special costs order against the non-parties until about December 2018.
Conclusion
62 In summary, I find that the plaintiff’s application for a special costs order should fail for several reasons. First, the non-parties were not the “real parties” to the proceeding and were not seeking to gain access to justice or using the court for their own purposes.
63 Secondly, the non-parties did not have any sufficient interest in the subject matter of the litigation.
64 Thirdly, the non-parties have not, as directors of the defendant, conducted the litigation in an improper or unreasonable manner.
65 Fourthly, there are no outstanding costs orders against the defendant.
66 Fifthly, from the time of the mediation, the plaintiff was on notice that the financial position of the defendant was uncertain. It does not appear from the affidavit material that the plaintiff took any, or any significant, steps before issuing proceedings to check the financial position of the defendant.
67 Finally, the circumstances of the case did not satisfy the principles needed to justify the exercise of the court’s power to make an order against the non-parties.
68 Accordingly, I propose to dismiss the application. I direct that the parties produce minutes of order giving effect to these reasons by 4:00pm on 1 May 2019. If there is a dispute about the proposed orders, each party is to file and serve by 4:00pm on 2 May 2019 a written submission setting out the orders it seeks and the reasons therefor. Each party can then file and serve reply submissions by 4:00pm on 3 May 2019. Unless a party specifically requests it, or the Court considers it appropriate, there shall be no further oral hearing with respect to this matter.
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