Singtel Optus Pty Ltd v Weston (Costs) - [2012] NSWSC 1002

Supreme Court

New South Wales

Medium Neutral Citation: SingTel Optus Pty Limited & Ors v Weston (Costs) [2012] NSWSC 1002
Hearing dates: 3 August 2012
Decision date: 29 August 2012
Jurisdiction: Equity Division - Corporations List
Before: Bergin CJ in Eq
Decision:
Defendant entitled to indemnity.

Catchwords: [INDEMNITY] - [LIQUIDATORS] - "general rule" in relation to indemnity for liquidators' costs in defending removal proceedings - whether conduct in defending proceedings for removal a basis for denial of indemnification for costs of the litigation.
Legislation Cited: Legal Profession Act 2004
Cases Cited: Aboriginal and Torres Strait Island Commission v Jurnkurakurr Aboriginal Resource Centre Aboriginal Corporation (in liq) (1992) 110 FLR 1; 10 ACSR 121
Adsett v Berlouis (1992) 37 FCR 201; 109 ALR 100
City & Suburban Pty Ltd v Smith (liq of Conpaq (Aust) Pty Ltd (in liq)) (Unreported, Federal Court of Australia, Merkel J, 31 July 1998)
Cresvale Far East Ltd (in liq) v Cresvale Securities Ltd & Others (No 2) [2001] NSWSC 791; (2001) 39 ACSR 622
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd and Others (1988) 81 ALR 397
Gatsios Holdings v Kritharas Holdings (in Liquidation) [2002] NSWCA 29
In Re Chennell (1878) 8 Ch 492
Kirwan v Cresvale Far East Ltd (in liq) and Others [2002] NSWCA 395; (2002) 44 ACSR 21
Re Beddoe; Downes v Cottam [1893] 1 Ch 547
Re Biposo Pty Ltd; Condon v Rodgers (No 3) (1995) 17 ACSR 730
Re Queensland Stations Pty Limited (1991) 9 ACLC 1341
Re Shanks Byrne Industries Pty Ltd [1979] 2 NSWLR 880
Ruhani v Director of Police (2005) 222 CLR 489
SingTel Optus Pty Limited & Ors v Weston [2012] NSWSC 674
Weston (in his capacity as special purpose liquidator of One.Tel Ltd (in liq)) & Anor v Publishing and Broadcasting Ltd (now known as Consolidated Media Holdings Ltd) & Ors [2011] NSWSC 433; (2011) 83 ACSR 206
Category: Costs
Parties: SingTel Optus Pty Limited (1st Plaintiff)
Optus Networks Pty Limited (2nd Plaintiff)
Optus Mobile Pty Limited (3rd Plaintiff)
Optus Vision Pty Limited (4th Plaintiff)
Optus Insurance Services Pty Limited (5th Plaintiff)
Paul Gerard Weston (Defendant)
Steven Sherman and Peter Walker in their Capacities as General Purpose Liquidators of One.Tel Limited (in liquidation) (Second Defendants)
Representation: RCA Higgins (Plaintiffs)
N Cotman SC/R Glasson (Defendant)
V Whittaker (Second Defendants)
Baker & McKenzie (Plaintiffs)
O'Neill Partners (Defendant)
Kemp Strang (Second Defendants)

File Number(s): 2010/71799

Judgment

On 19 June 2012 Paul Gerard Weston (the defendant) was removed as Special Purpose Liquidator of One.Tel Limited (in liquidation) (One.Tel): SingTel Optus Pty Limited & Ors v Weston [2012] NSWSC 674 (the Judgment). On 3 August 2012 the General Purpose Liquidators of One.Tel were joined as the second defendants for the purpose of taking part in the costs hearing and/or the making of costs orders. The parties have agreed to orders pursuant to which the defendant is to pay the plaintiffs' costs of the proceedings and his own costs of the…

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: [2012] NSWSC 1002
Decision Date: 29 August 2012

CaseChat Overview and Summary

The matter before the court involved Singtel Optus Pty Ltd, a telecommunications company, and the liquidators of a company, Weston. The central dispute was regarding the liquidators' entitlement to indemnity for the costs incurred in defending removal proceedings. The court had to determine whether the conduct of the liquidators in defending the proceedings could be a basis for denying them indemnification for the litigation costs.

The primary legal issue the court needed to address was whether the conduct of the liquidators in defending removal proceedings could justify withholding indemnity for their costs. This involved examining the general rule on indemnity for liquidators' costs and whether there were any exceptions or circumstances under which the court could refuse to indemnify the liquidators for the costs of the litigation.

The court examined the general rule regarding indemnity for liquidators' costs and concluded that there was no authority to support the proposition that the conduct of the liquidators in defending removal proceedings could be a basis for denying them indemnification for their costs. The court found that the general rule allows for indemnification unless there are exceptional circumstances. Since no such circumstances were present, the court ruled in favour of indemnifying the liquidators for the costs of the litigation. The court determined that the liquidators were entitled to reimbursement of their costs, barring any exceptional circumstances.

The final orders of the court were that the liquidators were entitled to be indemnified for their costs in defending the removal proceedings, unless there were exceptional circumstances that would justify withholding such indemnity. This decision underscores the importance of the general rule and the absence of any exceptional circumstances that would alter the usual course of indemnification for liquidators' costs in such cases.

Orders