Taouk v Assure (NSW) Pty Ltd - [2017] NSWCA 160

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Taouk v Assure (NSW) Pty Ltd [2017] NSWCA 160
Hearing dates: 26 June 2017
Date of orders: 26 June 2017
Decision date: 29 June 2017
Before: Meagher JA
Decision:
The respondent’s notice of motion filed 14 June 2017 is dismissed with costs.

Catchwords: PROCEDURE – uniform civil procedure – security for costs – application under Uniform Civil Procedure Rules 2005 (NSW), rr 42.21, 51.50 and inherent jurisdiction – where appellant failed to comply with orders at first instance – whether non-compliance justified security for costs on appeal – where appellant property developer enjoyed “interests” in properties held under discretionary trust – whether reason to believe appellant divested assets to avoid consequences of adverse costs order by causing trustee to sell two properties at undervalue – no issue of principle
Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW), rr 42.21(1), (1B) and 51.50
Cases Cited: Cherry v Read and Others (Full Court of Federal Court, Black CJ, Sackville, Finn JJ, 21 November 1996, unrep).
Cowell v Taylor (1885) 31 Ch D 34
Green v CGU Insurance Limited [2008] NSWCA 148; (2008) 67 ACSR 105
Levy v Bablis [2011] NSWCA 411
Pi v Zhou [2017] NSWCA 16
Preston v Harbour Pacific Underwriting Management Pty Ltd [2007] NSWCA 247
Remm Construction (SA) Pty Ltd v Allco Newsteel Pty Ltd (1992) 57 SASR 180
Sagacious Procurement Pty Limited v Symbion Health Limited [2007] NSWCA 205
Shannon v Australia and New Zealand Banking Group [1994] 2 Qd R 563 at 563-564
Category: Procedural and other rulings
Parties: Joseph Taouk (Appellant)
Assure (NSW) Pty Ltd (Respondent)
Representation:
Counsel:
D Allan (Solicitor) (Appellant)
P Reynolds (Solicitor) (Respondent)
Solicitors:
Gardner Ekes Lawyers (Appellant)
MHL Lawyers Pty Ltd (Respondent)

File Number(s): 2017/166532
Decision under appeal

Court or tribunal:

Supreme Court

Jurisdiction:

Equity Division

Citation:

[2017] NSWSC 534

Date of Decision:

4 May 2017

Before:

Sackar J

File Number(s):

2016/264640

Judgment

MEAGHER JA: On 26 June 2017, I heard and dismissed the respondent’s application for security for costs. I reserved the giving of my reasons for doing so. These are those reasons.
The primary judge (Sackar J) dismissed the appellant’s claims and decided questions of liability raised by the respondent’s cross-claims in favour of the respondent: Joseph Taouk v Assure (NSW) Pty Ltd [2017] NSWSC 534. Those claims arose in respect of a property development at Berowra. The respondent was the owner of that property. The appellant provided the respondent with a guarantee and indemnity of the corporate developer’s obligations under its agreement with the respondent. He was also the sole director and shareholder of the building company that contracted with the developer to construct the development.
The building work was not completed on time and the developer ultimately failed and has been deregistered. The appellant claimed against the respondent the recovery of payments made by him and others towards the cost of completing the development. He also claimed that those payments gave rise to caveatable interests…

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: [2017] NSWCA 160
Decision Date: 29 June 2017

CaseChat Overview and Summary

In *Taouk v Assure (NSW) Pty Ltd*, the appellant, a property developer, sought to appeal a decision. The respondent applied for security for costs of the appeal, alleging the appellant had failed to comply with orders made at first instance and that there was reason to believe the appellant had divested assets to avoid potential adverse costs orders. The application for security for costs was heard by Meagher JA.

The central legal issue before the Court was whether the appellant's non-compliance with prior orders and the alleged divestment of assets through a discretionary trust justified an order for security for costs on appeal. Specifically, the Court had to consider whether the appellant's interests in properties held under a discretionary trust, and the circumstances surrounding the sale of two properties at undervalue, provided a sufficient basis to believe the appellant was attempting to avoid their liabilities.

Meagher JA dismissed the respondent's application for security for costs. The Court found that the appellant's non-compliance with orders at first instance did not, in the circumstances, warrant security for costs on appeal. Furthermore, the Court was not satisfied that there was sufficient reason to believe the appellant had divested assets to avoid the consequences of an adverse costs order by causing the trustee to sell properties at undervalue. The Court applied the principles governing security for costs, particularly in the context of appeals, and found the respondent had not met the threshold required for such an order.

The respondent's notice of motion filed on 14 June 2017 was dismissed with costs.

Orders

Orders of the court

The respondent’s notice of motion filed 14 June 2017 is 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.

Medium Neutral Citation:	Taouk v Assure (NSW) Pty Ltd [2017] NSWCA 160
Hearing dates:	26 June 2017
Date of orders:	26 June 2017
Decision date:	29 June 2017
Before:	Meagher JA
Decision:	The respondent’s notice of motion filed 14 June 2017 is dismissed with costs.
Catchwords:	PROCEDURE – uniform civil procedure – security for costs – application under Uniform Civil Procedure Rules 2005 (NSW), rr 42.21, 51.50 and inherent jurisdiction – where appellant failed to comply with orders at first instance – whether non-compliance justified security for costs on appeal – where appellant property developer enjoyed “interests” in properties held under discretionary trust – whether reason to believe appellant divested assets to avoid consequences of adverse costs order by causing trustee to sell two properties at undervalue – no issue of principle
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW), rr 42.21(1), (1B) and 51.50
Cases Cited:	Cherry v Read and Others (Full Court of Federal Court, Black CJ, Sackville, Finn JJ, 21 November 1996, unrep). Cowell v Taylor (1885) 31 Ch D 34 Green v CGU Insurance Limited [2008] NSWCA 148; (2008) 67 ACSR 105 Levy v Bablis [2011] NSWCA 411 Pi v Zhou [2017] NSWCA 16 Preston v Harbour Pacific Underwriting Management Pty Ltd [2007] NSWCA 247 Remm Construction (SA) Pty Ltd v Allco Newsteel Pty Ltd (1992) 57 SASR 180 Sagacious Procurement Pty Limited v Symbion Health Limited [2007] NSWCA 205 Shannon v Australia and New Zealand Banking Group [1994] 2 Qd R 563 at 563-564
Category:	Procedural and other rulings
Parties:	Joseph Taouk (Appellant) Assure (NSW) Pty Ltd (Respondent)
Representation:	Counsel: D Allan (Solicitor) (Appellant) P Reynolds (Solicitor) (Respondent) Solicitors: Gardner Ekes Lawyers (Appellant) MHL Lawyers Pty Ltd (Respondent)
File Number(s):	2017/166532
Decision under appeal	Court or tribunal: Supreme Court Jurisdiction: Equity Division Citation: [2017] NSWSC 534 Date of Decision: 4 May 2017 Before: Sackar J File Number(s): 2016/264640