Satcom Business Exchange Pty Ltd v BCCC Pty Ltd - [2001] WASC 126

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: SATCOM BUSINESS EXCHANGE PTY LTD -v- BCCC PTY LTD & ORS [2001] WASC 126

CORAM: MASTER SANDERSON

HEARD: 7 MAY 2001

DELIVERED : 24 MAY 2001

FILE NO/S: CIV 1406 of 1996

BETWEEN: SATCOM BUSINESS EXCHANGE PTY LTD (ACN 009 381 917)
Plaintiff
AND
BCCC PTY LTD (ACN 006 525 140)
First Defendant
JOHN FALCONER HEGGIE
ROGER MILLS BUNN
Second Defendants

Catchwords:

Practice and procedure - Application for security for costs - Turns on own facts

Legislation:

Corporations Law, s 1335

Result:

Security ordered

Representation:

Counsel:

Plaintiff:     Mr N D Billington
First Defendant             :     Mr C Touyz
Second Defendants       :     Mr C Touyz

Solicitors:

Plaintiff:     Cahill Billington
First Defendant             :     Hammond King Touyz
Second Defendants       :     Hammond King Touyz

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

Beach Petroleum NL v Johnson [1992] 10 ACLC 525
FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd (2000) 22 WAR 241
Warren Mitchell Pty Ltd v Australian Maritime Officers' Union [1993] 11 ACLC 1238

Case(s) also cited:

Aspendale Pastoral Co Pty Ltd v WJ Drewer Pty Ltd (1983) 7 ACLR 937
Bell Wholesale Co Ltd v Gates Export Corporation (1984) 2 FCR 1
Brundza v Robbie & Co (No 2) (1952) 88 CLR 171
Bryan E Fencot and Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497
Concorde Enterprises Ltd v Anthony Motors (Hutt) Ltd (No 2) [1977] 1 NZLR 516
Heller Factors Pty Ltd v John Arnold's Surf Shop (1979) 4 ACLR 492
J & M O'Brien Enterprises Pty Ltd v The Shell Company of Australia Ltd (1983) 70 FLR 264
Jennings Ltd (Invol Liq) v Cole (1934) GLR 165
KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 13 ACLC 437
Marconi Wireless Telegraph Company (Limited) v The Huddart-Parker and Compass Proprietary (Limited) (1912) 31 NSWLR 499
Microcorp Pty Ltd v Terran Computers Pty Ltd, unreported; FCA; Northrop J; 26 June 1992; No VG 258 of 1991
Pacific Acceptance Corporation Ltd v Forsyth (No 2) 2 NSWLR 402
PS Chellaram & Co v China Shipping Co (1991) 65 ALJR 642
Sir Lindsay Parkinson & Co Ltd v Triplan Ltd [1973] 1 QB 609
Southern Cross Exploration NL v Fire and All Risks Insurance Co Ltd (1985) 1 NSWLR 114
Tune Masters Pty Ltd (In Liq) v Sectam Pty Ltd, unreported; SCt of WA; Library No 970267; 23 May 1997
Westralian Gold Mines Ltd v Westralian Minerals & Drilling Pty Ltd (In Liq) (1986) 4 ACLC 167
Zortec Australia Pty Ltd and DHS Holdings Pty Ltd v The Rural and Industries Bank of Western Australia, unreported; SCt of WA; Library No 920609; 13 August 1992

MASTER SANDERSON: This is the first and second defendants' application for security for costs. The application is brought under s 1335 of the Corporations Law which is in the following terms:
"Where a corporation is plaintiff in any action or other legal proceeding, the court having jurisdiction in the matter may, if it…

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

Case: [2001] WASC 126
Decision Date: 24 MAY 2001

CaseChat Overview and Summary

The matter of Satcom Business Exchange Pty Ltd versus BCCC Pty Ltd was brought before the court to resolve a dispute over an application for security for costs. Satcom sought an order for security for its anticipated legal costs, arguing that BCCC's litigation was without merit and likely to cause financial hardship. The court was tasked with determining the appropriate amount of security, if any, that should be provided by BCCC before proceeding with the litigation.

The primary legal issue before the court was whether the application for security for costs should be granted. This required an assessment of the merits of Satcom's claims and the likelihood of BCCC's ability to pay the costs if ordered. The court had to consider the factors outlined in the relevant legislation, including the prospects of success of Satcom's claims, the conduct of the parties, and the financial circumstances of both Satcom and BCCC. Additionally, the court had to balance the need to protect Satcom from potential financial loss against the principles of fairness and justice in the legal process.

The court carefully examined the evidence presented by both parties and the applicable legal principles. It concluded that the application for security for costs should be granted, albeit in a reduced amount. The court found that while Satcom's claims had some merit, there were significant uncertainties and complexities in the case that warranted an order for security. The court also considered the financial circumstances of both parties and the potential for prejudice if the order was not made. After weighing all the factors, the court determined that BCCC should provide security for a specified amount before proceeding with the litigation.

The final orders included an order for BCCC to provide security for the specified amount within 14 days, and further orders as to the conduct of the proceedings pending the payment of security. The court emphasised that the order for security was not a determination on the merits of the case and that the proceedings would continue to be heard on their merits.

Orders