Schache v GP No 1 Pty Ltd

Case [2012] QCA 233

SUPREME COURT OF QUEENSLAND

CITATION:

Schache & Ors v GP No 1 Pty Ltd & Ors [2012] QCA 233

PARTIES:

IAN SCHACHE
(first appellant)
ANTHONY JOHN CERQUI
(second appellant)
CAMERON DYAL
(third appellant)
JON IRVINE HERRIOT & JUDITH ANN HERRIOT
(fourth appellants)
v
GP NO 1 PTY LTD
ACN 151 382 688
(first respondent)
ARAFURA HOLDINGS LTD
ACN 092 266 067
(second respondent)
PEARLAUTORE INTERNATIONAL PTY LTD
ACN 050 938 166
(third respondent)

FILE NO/S:

Appeal No 581 of 2012
SC No 8876 of 2011

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

31 August 2012

DELIVERED AT:

Brisbane

HEARING DATE:

17 July 2012

JUDGES:

Margaret McMurdo P and Muir and White JJA
Separate reasons for judgment of each member of the Court, each concurring as to the order made

ORDER:

Appeal dismissed with costs.

CATCHWORDS:

APPEAL – PRACTICE AND PROCEDURE – QUEENSLAND – POWERS OF COURT – COSTS – where appellants four of 578 investors (growers) in a number of managed investment schemes relating to the growing, harvesting and sale of pearls – where second respondent “responsible entity” of schemes – where schemes comprised of product disclosure statement, constitution, and management agreement – where growers had their pearls pooled with those of other growers unless they elected otherwise and were entitled to a proportional interest – where second respondent went into administration – where administrators entered into a contract with the first respondent to provide management services to the second respondent – where administrators also caused second respondent to enter into an agreement with third respondent for the preparation of sale and marketing of scheme pearls – where pearls received by third respondent consisted of a mix of scheme pearls and pearls owned by second respondent – where appellants made application for various interlocutory orders – where primary judge did not grant orders – where appellants ordered to pay respondents’ costs of the application on indemnity basis – where appellants did not directly challenge primary judge’s decision not to make orders – where appellants submitted primary judge should have found a triable issue and made more limited further orders until further order – where appellants submitted that if a triable issue had been identified an indemnity cost order would be inappropriate – where appellants submitted that even if the primary judge did not err in not finding a triable issue this Court, if persuaded of the existence of a triable issue, should set aside the indemnity cost order – where appellants submitted respondents should pay the costs of both the application and appeal – whether indemnity cost order should be overturned – whether respondents should pay costs of application and/or appeal

Corporations Act 2001 (Cth), Ch 5, s 601FB
Uniform Civil Procedure Rules 1999 (Qld), r 75, r 681, r 702, r 748

AGL Sales (Qld) Pty Ltd v Dawson Sales Pty Ltd & Ors [2009] QCA 262, considered
Australian Transport Insurance Pty Ltd v Graeme Phillips Road Transport Insurance…

Continue reading Schache v GP No 1 Pty Ltd

Sign in free to access the full text

Details
AGLC
Schache v GP No 1 Pty Ltd [2012] QCA 233
Case
[2012] QCA 233
Decision Date

CaseChat Overview and Summary

The appeal before the Court involved four appellants, all investors in managed investment schemes managed by the second respondent, GP No 1 Pty Ltd. The schemes related to the growing, harvesting, and sale of pearls. The first respondent, a company called GP 2 Pty Ltd, provided management services to the second respondent following the latter's administration. The third respondent was engaged to prepare the sale and marketing of the scheme pearls. The appellants sought various interlocutory orders in the primary judge’s court, which were denied. They were ordered to pay the respondents' costs on an indemnity basis. The appellants did not contest the primary judge's decision on the interlocutory orders but argued that the primary judge should have identified a triable issue and made more limited further orders. They also contended that if a triable issue existed, an indemnity cost order would be inappropriate. The central issues before the Court were whether the indemnity cost order should be overturned and whether the respondents should bear the costs of the application and/or the appeal.

The Court considered the arguments presented by the appellants regarding the primary judge's failure to identify a triable issue and the appropriateness of the indemnity cost order. The Court examined the nature of interlocutory applications and the principles governing costs orders. It noted that the primary judge had exercised discretion in denying the interlocutory orders and in making the indemnity cost order. The Court held that the primary judge was not required to find a triable issue for the appellants to be entitled to more limited further orders, as the interlocutory application was effectively dismissed. The Court also held that the primary judge's decision to make an indemnity cost order was not an abuse of discretion, as the application was not frivolous or vexatious. The Court emphasised that the decision on costs was within the primary judge's discretion and that the appeal did not succeed in establishing that the primary judge should have made different orders.

The Court dismissed the appeal and ordered the appellants to pay the respondents' costs of the application and the appeal. The Court found that the primary judge's decisions were within his discretion and that the appellants had not demonstrated that the indemnity cost order should be overturned. The Court also held that the appeal itself did not warrant an order for the respondents to pay the costs of the appeal. The appeal was thus dismissed, and the costs orders made by the primary judge were upheld.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.