Turner Road Project Pty Limited v SMEC Australia Pty Limited

Turner Road Project Pty Limited (Turner) brought an action against SMEC Australia Pty Limited (SMEC) for costs incurred in relation to a construction project. The dispute centred on SMEC's alleged failure to provide professional services in accordance with the contract. Turner applied for an order that SMEC provide security for costs, arguing that a delay in making the application was justified due to the complexity of the case. SMEC opposed the application, contending that the delay was inexcusable and that security should not be ordered. The court had to determine whether the delay in applying for security for costs was justified and, if so, whether security should be ordered.

The court considered the principles governing security for costs, including the balance of convenience test and the requirement for a good arguable case. It noted that delay in making an application for security for costs was not necessarily fatal, provided that the delay was justified. The court held that the delay in this case was justified due to the complexity of the issues and the need for Turner to fully assess its position before making the application. The court also found that Turner had a good arguable case and that the balance of convenience favoured ordering security.

The court ordered SMEC to provide security for costs, subject to certain conditions. The court emphasised that the order was not a reflection on the merits of the case but rather a procedural decision to manage the risks associated with litigating a complex case. The court also noted that the order was not intended to deter parties from making applications for security for costs where justified. The court made an order that SMEC provide security for costs in the sum of $500,000, with certain conditions attached to the order.