The Tubby Trout Pty Ltd v Sailbay Pty Ltd

[1991] FCA 892

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JUDGMENT NO. ...... - ........ .. .----

IN THE F E D ~ ~ COURT OF AUSTRALIA ) NO. QG 14 of 1989

QUEENSLAND DISTRICT REGISTRY	1
GENERAL DIVISION	1

BETWEEN: THE TUBBY TROUT PTY. LTD.

First Applicant

AND: DAVID MARSDEN McINTYRE

CATHRYN MARY McINTYRE

Second Applicants

AND? SAILBAY PTY. LTD.

First Respondent

AND: ANTHONY JOHN WHITE

Second Respondent

AND: ROBERT DUNCAN MCCRAE. MARCUS ROY FORD AND

CHRISTOPHER HARDY GASTEEN

Third Respondents

',

MINUTES OF ORDER

JUDGE MAKING ORDER:	PINCUS J.
DATE OF ORDER:	31 MAY 1991
WHERE MADE:	BRISBANE
THE COURT ORDERS THAT:
NOTE!	Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

1.    The application for security be dismissed.

2.    Costs of the application be costs in the proceedings.

3.    All statements of the respondents be delivered on or before 21 June 1991.

IN THE FEDE~AL COURT OF AUSTRALIA 1 No. QG 14 of 1989

QUEENSLAND DISTRICT REGISTRY	1
GENERAL DIVISION	1

BETWEEN: THE TUBBY TROUT PTY. LTD.

First Applicant

AND: DAVID MARSDEN MCINTYRE

CATHRYN MARY McINTYRE

Second Applicants

AND: SAILBAY PTY. LTD.

First Respondent

AND: ANTHONY JOHN WHITE

Second Respondent

AND:  ROBERT DUNCAN McCRAE. MARCUS ROY FORD AND
CHRISTOPHER HARDY GASTEEN

Third Respondents

CORAM: PINCUS J.

PLACE: BRISBANE

m: 31 MAY 1991

EX TEMPORE REASONS FOR JUDGMENT

This is an application by the first and second

respondents for security for costs. The case concerns an

unsuccessful restaurant venture, the applicants asserting that they were induced to enter into it by misstatements of various

kinds. In these reasons, I shall give the parties the

designations they have in the principal proceedings and shall
call those respondents who apply for security, being the first

and second respondents, simply the respondents.

Although counsel for the applicants submitted that

the applicants, who say they are impecunious, became so as a

direct result of the conduct of the respondents, it is not, in

my opinion, possible to act on that basis. Many small

businesses, particularly restaurants, fail for reasons other

than the making of misleading statements to their proprietors.

I cannot attempt to determine whether or not the applicants

have a good chance of success in the principal proceedings, nor whether any unlawful act on the part of the respondents caused them loss.

The basis of the application for security is that

set out in Order 28 rule 3(l)(a), namely, that an applicant is

ordinarily resident outside Australia. The first applicant

is a company, but that is not, in truth, substantially relied

on, presumably because of what was said in Harpur v. Ariadne

Australia Limited [l9841 2 Qd.R. 523. It is common ground

that both the natural persons who are applicants, that is, the

second applicants, are now resident in New Zealand.

In Barton v. The Minister for Foreiqn Affairs (1984)

54 A.L.R. 586 at p.593, Morling J. expressed himself in
language which seems to me to amount to the proposition that
an impecunious applicant resident out of the jurisdiction in a
country in which judgments of this Court may be enforced by a
registration process would not ordinarily be required to give

security under Order 28 rule 3(l)(a) other than in respect of

the costs of registering and enforcing a judgment in that

country.

I refer also to CBS Records Australia Limited v.

Telmac Teleuroducts Australia Proprietarv Limited (1987) 72

A.L.R. 270 at p.285, per Bowen C.J. I propose to act on the

views just mentioned, except that I do not see sufficient
practical point as to New Zealand in requiring security in

respect of a relatively small sum of money involved in

registering a judgment. It is admitted that New Zealand is a

country in which judgments of this Court may be enforced by a

registration process

Mr. Baston, for the applicants, says that, apart

from the matter just referred to, the application for security

should be refused because of the respondents' delay in

applying. The answer the respondents make is that they knew

only recently that the second applicants had moved to New

Zealand.	I think there is something in Mr. Baston's
criticism of that part of the respondents' case.	The

respondents do not make it clear on what date they became

aware that the second applicants had gone to live in New

Zealand. In fact, the second applicants went there in 1989.

In those circumstances, and applying the authorities to which
I refer, it would seem to me that the application, were it not

for a consideration to be mentioned, must fail or

substantially fail. The respondents are not, if they win the

case, much less able to recover any costs awarded than they

would have been if the second applicants had remained in this

country.

The special consideration which requires mention is

that there was tendered at the hearing a photostat copy of a

document evidencing ownership of land by one of the second

applicants, Mr. D.M. McIntyre. Mr. Couper, for the

respondents, pointed out that the applicants had not disclosed ownership of land and, indeed, claimed to have no assets apart

from jewellery. Because Mr. Couper relied heavily upon the

non-disclosure of ownership of the land, I adjourned the case so that Mr. McIntyre would have an opportunity to explain the circumstances.

That was done. I have studied the explanation,

which I do not find entirely convincing, but nevertheless

sufficient to avert the result to which I referred above. It

appears to me, however, that the Court should signify in some
way its disapproval of the content of the initial affidavit,
which, I think, was rather misleading, and that will be done
by way of an order for costs different from that which would

otherwise have been made.

The application for security will be dismissed, but

the costs, instead of being costs in the applicants' case,

will simply be costs in the proceedings. I will order that

all statements of the respondents be delivered on or before 21

June.

I certify that this and the three preceding pages are a

true copy of the reasons for judgment herein of his

Honour Mr. Justice Pincus Z

CL, \h-) -=.v-_

Associate

Date 31 MO? 1771