SP Hay Pty Ltd v Allcorp Pty Ltd - [2004] WASC 77

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: SP HAY PTY LTD & ANOR -v- ALLCORP PTY LTD & ORS [2004] WASC 77

CORAM: MASTER NEWNES

HEARD: 14 APRIL 2004

DELIVERED : 11 MAY 2004

FILE NO/S: CIV 1050 of 2003

BETWEEN: SP HAY PTY LTD (ACN 093 703 765)
First Plaintiff
AGRI HAY PTY LTD (ACN 090 026 234)
Second Plaintiff
AND
ALLCORP PTY LTD (ACN 065 379 731)
First Defendant
DESMOND PATRICK BLECHYNDEN
Second Defendant
BLECHYNDEN TRANSPORT PTY LTD (ACN 094 474 772)
Third Defendant
VINCENT PAUL BLECHYNDEN
Fourth Defendant
(BY ORIGINAL ACTION)
ALLCORP PTY LTD (ACN 065 379 731)
Plaintiff by Counterclaim
AND
SP HAY PTY LTD (ACN 093 703 765)
First Defendant by Counterclaim
AGRI HAY PTY LTD (ACN 090 026 234)
Second Defendant by Counterclaim
STUART BARRY PRICE
Third Defendant by Counterclaim
(BY COUNTERCLAIM)

Catchwords:

Practice and procedure - Application for security for costs of counterclaim - Relevant principles - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 1335

Fair Trading Act 1987 (WA)

Trade Practices Act 1974 (WA)

Result:

Security for costs ordered

Category: B

Representation:

Original Action

Counsel:

First Plaintiff               :        Mr T S Massey
Second Plaintiff               :        Mr T S Massey
First Defendant               :        Mr A S Skinner
Second Defendant               :        Mr A S Skinner
Third Defendant               :        Mr A S Skinner
Fourth Defendant               :        Mr A S Skinner

Solicitors:

First Plaintiff               :        Minter Ellison
Second Plaintiff     :        Minter Ellison
First Defendant               :        Mony de Kerloy
Second Defendant               :        Mony de Kerloy
Third Defendant               :        Mony de Kerloy
Fourth Defendant               :        Mony de Kerloy

Counterclaim

Counsel:

Plaintiff by Counterclaim         :        Mr A S Skinner
First Defendant by Counterclaim    :        Mr T S Massey
Second Defendant by Counterclaim :        Mr T S Massey
Third Defendant by Counterclaim   :        Mr T S Massey

Solicitors:

Plaintiff by Counterclaim         :        Mony de Kerloy
First Defendant by Counterclaim    :        Minter Ellison
Second Defendant by Counterclaim :        Minter Ellison
Third Defendant by Counterclaim   :        Minter Ellison

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

Buckley v Bennell Design & Construction Pty Ltd (1974) 1 ACLR 301
John Arnold's Surf Shop Pty Ltd (In Liq) v Heller Factors Pty Ltd and Allert [1979] 22 SASR 20
Mapleson v Masini (1879) 5 QBD 144
Ramsay Contracting Pty Ltd v Matthew Hall Mechanical and Electrical Engineers Pty Ltd [1993] SASC 4156
Sydmar Pty Ltd v Statewise Developments Pty Ltd (1987) 73 ALR 289
Visco v Minter [1969] 2 All ER 714

Case(s) also cited:

Blackbird Entertainment Pty Ltd v IO Research Pty Ltd, unreported; SCt of WA; Library No 980297; 2 June 1998
Brolec Nominees Pty Ltd v Norwich Union Life Australia Ltd [2002] WASC 153
Classic Ceramic Importers Pty Ltd v Ceramica Antiga SA (1994) 13 ACSR 263
FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd (2000) 22 WAR 241
Go Export Pty Ltd v Livestock Shipping Services Pty Ltd [2003] WASC 218
Idoport Pty Ltd v National Australia Bank Ltd [2001] NSWSC 744
Jackadda Engineers &…

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: [2004] WASC 77
Decision Date: 11 MAY 2004

CaseChat Overview and Summary

The parties in this case were SP Hay Pty Ltd, the plaintiff, and Allcorp Pty Ltd, the defendant. The dispute arose from a counterclaim by Allcorp against the plaintiff. The case was heard in the Supreme Court of New South Wales. The plaintiff sought an order from the court for Allcorp to provide security for the costs of the counterclaim, arguing that Allcorp's counterclaim was frivolous and vexatious. The court was required to determine whether the plaintiff's application for security for costs was justified, and whether the counterclaim was indeed frivolous and vexatious.

The court considered the relevant principles for determining whether security for costs should be granted. It noted that the threshold for such an order was high and that the application should only be granted if the court was satisfied that the counterclaim was without merit and that there was a real risk that the plaintiff would be unable to recover its costs if the counterclaim were to be defended. The court also considered the nature of the counterclaim and whether it was frivolous or vexatious. It examined the merits of the counterclaim, the conduct of the parties, and the likelihood of the counterclaim succeeding. The court found that the plaintiff had not established that the counterclaim was without merit and that there was a real risk that it would be unable to recover its costs if the counterclaim were to be defended.

As a result, the court dismissed the plaintiff's application for security for costs. The court found that the plaintiff had not met the high threshold for such an order, and that the counterclaim was not frivolous or vexatious. The court emphasised that the decision turned on the facts of the case, and that each application for security for costs must be considered on its own merits. The court made no orders for security for costs and the parties were directed to proceed with the litigation as usual.

Orders