Washburn Pty Ltd v Cardaci - [2022] WASCA 15

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT :   THE COURT OF APPEAL (WA)
CITATION:   WASHBURN PTY LTD -v- CARDACI [2022] WASCA 15
CORAM:   MITCHELL JA
VAUGHAN JA

HEARD:   11 FEBRUARY 2022
DELIVERED          :   11 FEBRUARY 2022
PUBLISHED           :   14 FEBRUARY 2022
FILE NO/S:   CACV 101 of 2021
BETWEEN:   WASHBURN PTY LTD
First Appellant
RECTANGULAR PTY LTD
Second Appellant
ONGOLD CORPORATION PTY LTD
Third Appellant
FILIPPO PRIMO CARDACI
Fourth Appellant
ANGELA FRANCESCA CARLA FLORIDO
Fifth Appellant
AND
MAE CARDACI
First Respondent
DUPORTE CORPORATION PTY LTD
Second Respondent
POWERCITY PTY LTD
Third Respondent

ON APPEAL FROM:
Jurisdiction              :   SUPREME COURT OF WESTERN AUSTRALIA
Coram:   LE MIERE J
Citation: CARDACI -v- FILIPPO PRIMO CARDACI as executor of the estate of MARCO ANTONIO CARDACI [No 5] [2021] WASC 331
File Number            :   CIV 1750 of 2017, CIV 3186 of 2016

Catchwords:

Appeal - Practice and procedure - Application for security for costs - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 1335(1)

Result:

Application for security for costs granted against first, second and third appellants

Category: B

Representation:

Counsel:

First Appellant	:	M L Bennett
Second Appellant	:	M L Bennett
Third Appellant	:	M L Bennett
Fourth Appellant	:	M L Bennett
Fifth Appellant	:	M L Bennett
First Respondent	:	M D Cuerden SC and N L Phan
Second Respondent	:	No appearance
Third Respondent	:	No appearance

Solicitors:

First Appellant	:	Bennett + Co
Second Appellant	:	Bennett + Co
Third Appellant	:	Bennett + Co
Fourth Appellant	:	Bennett + Co
Fifth Appellant	:	Bennett + Co
First Respondent	:	Herbert Smith Freehills
Second Respondent	:	In person
Third Respondent	:	In person

Case(s) referred to in decision(s):

George 218 Pty Ltd v Bank of Queensland Limited [2016] WASCA 56
Hill v Zuda Pty Ltd as trustee for The Holly Superannuation Fund [2020] WASCA 87
Oze‑Igiehon v Rasier Operations BV [2017] WASCA 107

REASONS OF THE COURT:

At the conclusion of the hearing of the first respondent's application for security for costs in this appeal, we ordered that:
By 25 February 2022, the first appellant, second appellant and third appellant pay into court an amount of $100,000 as security for the first respondent's costs of the appeal.
We said that we would publish reasons for making that order later. These are our reasons for making that order.

Background

As many of the relevant people share the surname 'Cardaci', it is convenient to refer to members of the Cardaci family by their first name (without intending any disrespect).
Mae Cardaci was the plaintiff in the primary proceedings and is the first respondent to this appeal and an associated appeal (CACV 100 of 2021). Mae is the widow of Marco Cardaci (Marc), who died on 7 November 2015.
At the time of his death, the principal sources of Marc's wealth were as follows:
1.The Washburn Trust, a discretionary family trust of which Marc was trustee, and of which Marc and Mae were among…

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: [2022] WASCA 15
Decision Date

CaseChat Overview and Summary

The appeal in Washburn Pty Ltd v Cardaci was heard by the Court of Appeal in Western Australia, presided over by Mitchell JA. The case involved an application for security for costs in relation to an appeal against orders made in the primary proceedings, which were successful for the respondent, Mae Cardaci. The primary proceedings were a Family Provision action and a Trust action, in which Mae sought relief from the estate and trusts of her late husband, Marc Cardaci. The appeals were brought by various appellants, including former trustee companies, family members, and associates of the Cardaci family.

The legal issues the court had to decide included whether the trial judge's findings of fact and law were correct, as well as whether the appellants' inability to satisfy a costs order if the appeal were to fail warranted an order for security for costs. The court had to balance the interests of justice against the appellants' right to appeal and consider factors such as the appellants' prospects of success, their impecuniosity, and any delay in filing the application for security for costs.

In its reasoning, the court outlined the general principles for ordering security for costs, emphasizing that the discretion to order security is unfettered but must be exercised judicially. The court found that the former trustee companies, Washburn, Rectangular, and Ongold, were likely unable to pay Mae's costs of the appeal if the appeal were to fail. The court also noted that there was a real risk that even with correct legal advice and the benefit of the trial judge's reasons, the interests of Mae may not be given real and genuine consideration by Washburn or Rectangular. The court concluded that ordering security for costs was in the interests of justice.

The court ordered that Washburn, Rectangular, and Ongold pay into court an amount of $100,000 as security for Mae's costs of the appeal. This decision was based on the specific circumstances of the case and the court's assessment of the factors relevant to ordering security for costs. The court did not order security for costs against the individual appellants, Philip and Angela, as they were considered to have sufficient financial resources to meet any personal costs liability.

Orders