v and M Davidovic Pty Limited v Professional Services Group Pty Limited

The case involved a dispute between V and M Davidovic Pty Limited, the plaintiff, and Professional Services Group Pty Limited, the defendant. The plaintiff sought to recover damages for professional negligence. The defendant, in turn, applied for an order for the plaintiff to provide security for the defendant’s costs of the proceeding. The matter was heard in the Supreme Court of New South Wales. The plaintiff, a company, had a receiver and manager appointed, which was a material factor in the court's consideration of the defendant's application.

The court was required to determine whether the plaintiff was liable to provide security for the defendant's costs of the proceeding and, if so, the appropriate amount of security. The court also had to consider whether the proceedings should be stayed until the plaintiff provided the required security. The key legal issue was whether, in light of the receivership and management of the plaintiff, the defendant's costs would be recoverable from the plaintiff if the defendant succeeded in the proceedings.

The court examined the relevant statutory provisions and case law concerning security for costs in light of the plaintiff's receivership. It noted that the appointment of a receiver and manager does not automatically relieve the company of liability for costs. However, the court also recognised that the receiver and manager's control over the company's assets could affect the availability of security. After considering these factors, the court concluded that the defendant was entitled to an order for security for costs. However, the court decided not to stay the proceedings pending the provision of security, given the circumstances of the case.

The court ordered that the plaintiff provide security for the defendant's costs of the proceeding in the amount of $50,000. The court noted that this amount was provisional and could be varied if either party applied to the court. The court also noted that the defendant could apply for further security if the costs incurred exceeded the initial amount of security provided.