Validus Advisory Group Pty v Consolidated Tin Mines Ltd - [2017] NSWSC 1352

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Validus Advisory Group Pty v Consolidated Tin Mines Ltd [2017] NSWSC 1352
Hearing dates: 9 August 2017
Date of orders: 05 October 2017
Decision date: 05 October 2017
Jurisdiction: Common Law
Before: Lonergan J
Decision:
(1) The plaintiff is to pay the defendant’s costs of and associated with the application for security for costs up to and including Thursday, 20 July 2017.
(2) Each party is to bear its own costs of the application for security for costs on and from Monday, 21 July 2017 including the costs of the hearing on 24 July 2017, and the appearance on 9 August 2017 and the costs associated with the preparation of written and oral submissions on the question of costs of the application.

Catchwords: COSTS – security for costs – whether costs follow the event – costs of the application
Legislation Cited: Uniform Civil Procedures Rules 2005 r 42.1
Cases Cited: Bright Ceiling Systems Pty Ltd v Merhis Contracting Pty Ltd [2016] NSWSC 631 at [65] and [66]
Collignon Developments Pty Ltd v Wurth (1975) ACLR 314
Mignon Cakes Pty Ltd v Hiltide Pty Ltd [2004] FCA 142
Calderbank v Calderbank [1975] 3 All ER 333
Brian John Harris v Mark Harris (No. 2) [2013] NSWSC 1157
Commonwealth of Australia v Gretton [2008] NSWCA 117
Illawarra Hotel Co Pty Limited v Walton Construction Pty Ltd (No 2) [2013] NSWCA 211]
Texts Cited: G E Dal Pont, Law of Costs (3rd ed, 2013, Butterworths)
Category: Costs
Parties: Validus Advisory Group Pty Ltd (Plaintiff/Respondent)
Consolidated Tin Mines Ltd (Defendant/Applicant)
Representation:
Counsel:
J Hutton (Plaintiff)
D Weinberger (Defendant)
Solicitors:
King & Wood Mallesons (Plaintiff)
Deutsch Partners (Defendant)

File Number(s): 2017/73817
Publication restriction: Nil

Judgment

On 24 July 2017 I heard a contested application by the defendant for security for costs. On 9 August 2017 I made an order that the plaintiff provide security for the defendant’s costs in the sum of $85,000.
On delivery of my reasons for the judgment I was asked to reserve the question of costs of the application because there had been some negotiations before the hearing pursuing settlement of the application.
A submission was made by counsel for the plaintiff that I should order that each party pay its own costs, as this was the “usual order” in such applications. In support of that submission reliance was placed on the decision of Button J in Bright Ceiling Systems Pty Ltd v Merhis Contracting Pty Ltd [2016] NSWSC 631 (Bright Ceiling) at [65] and [66]. In the alternative, it was submitted that because the plaintiff had made a particular settlement offer of $50,000 now and $50,000 “down the track”, the plaintiff had effectively done better than the security offered and accordingly the plaintiff should be awarded its costs of the hearing.
The defendant was not in a position to argue costs on 9 August and with leave served written submissions which argued that the defendant should be…

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.

Keep reading for free

Create a free CaseChat account to read Validus Advisory Group Pty v Consolidated Tin Mines Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2017] NSWSC 1352
Decision Date: 05 October 2017

CaseChat Overview and Summary

In Validus Advisory Group Pty Ltd v Consolidated Tin Mines Ltd, the court was tasked with determining the appropriate costs to be awarded in relation to a security for costs application. The matter was brought before the Federal Court of Australia. Validus Advisory Group, the plaintiff, sought to recover the costs incurred in relation to the security for costs application from Consolidated Tin Mines, the defendant.

The central legal issue before the court was whether the costs of the security for costs application were to be treated as costs that follow the event, and thus recoverable from the defendant if the plaintiff were to be successful in the proceedings. The plaintiff argued that the costs should follow the event, while the defendant contended that the costs should not follow the event and should instead be borne by the plaintiff.

The court held that the costs of the security for costs application did not follow the event and were not recoverable from the defendant if the plaintiff were to be successful in the proceedings. The court reasoned that the security for costs application was a separate and distinct proceeding from the main action, and as such, the costs incurred in that application were not costs of the event itself. Instead, the costs of the security for costs application were to be borne by the party who incurred them. The court found that the plaintiff's argument that the costs should follow the event was not supported by the authorities and that the general rule was that costs do not follow the event in this context.

The court's decision effectively meant that the plaintiff would bear the costs of the security for costs application regardless of the outcome of the proceedings. The court did not make any specific orders in relation to the costs of the application but left it to the parties to agree on the amount or for the court to determine the costs at a later date if necessary.

Orders