Zafiropoulos v Fragogianis - [2024] NSWSC 309

Supreme Court

New South Wales

Medium Neutral Citation: Zafiropoulos v Fragogianis [2024] NSWSC 309
Hearing dates: 5 March 2024
Date of orders: 5 March 2024
Decision date: 26 March 2024
Jurisdiction: Equity - Duty List
Before: Parker J
Decision:
See [58]

Catchwords:
COSTS — interlocutory costs — application for asset preservation orders – orders obtained ex parte against defendants and third party – application abandoned following service of evidence by respondents – incidence of costs – reasonableness of application – costs follow the event – applicants ordered to pay costs – applicants ordered to pay lump sum on account of costs liability

Legislation Cited:
Civil Procedure Act 2005 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:
Cardile v LED Builders Pty Ltd (1999) 198 CLR 380
Fiduciary Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1
Hancock v Rinehart (Lump sum costs) [2015] NSWSC 1640
Heperu Pty Ltd & Ors v Belle [2011] NSWSC 115
Heperu Pty Ltd v Belle (2009) 76 NSWLR 230
OmuttaPty Ltd v Wilson (No 2) [2019] NSWSC 401
Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622
Shun Sheng Pty Ltd v Lei (No 2) [2023] NSWSC 1623
Shun Sheng Pty Ltd v Lei (No 3) [2024] NSWSC 72

Texts Cited:
Nil

Category: Costs
Parties: William Zafiropoulos (First Applicant/Plaintiff)
Zapphire Investments Pty Limited (Second Applicant/Plaintiff)
Anastasios Fragogianis (First Respondent/Defendant)
Fragogianis & Co Pty Limited (Second Respondent/Defendant)
Anna Fragogianis (Third Respondent)
Representation:
Counsel:
J Bennett (Applicants)
S Scott (Respondents)
Solicitors:
Optic Lawyers (Applicants)
Diamond Conway Lawyers (Respondents)

File Number(s): 2024/44900
Publication restriction: Nil

JUDGMENT

On 5 March I made consent orders dismissing an application by the plaintiffs for asset preservation orders against the defendants and another respondent. I then heard argument on costs. This judgment sets out my reasons for the orders I made as to the costs of the application.
The first plaintiff, William Zafiropoulos, is a dentist by profession. He is also described by his solicitor as an “accomplished” property investor. The second plaintiff, Zapphire Investments Pty Ltd (“ZIPL”), is a company which he uses for that purpose.
The first defendant, Anastasio Fragogianis, practised, at relevant times, as an accountant. His practice was conducted through the second defendant, Fragogianis & Co Pty Ltd (“FCPL”), a company of which he was a director and the sole shareholder. The practice was conducted under the name “CA Partners”. FCPL acted as tax agent for Mr Zafiropoulos and ZIPL from 2018 onwards. It is not clear on the evidence before me when the retainer ceased, but apparently FCPL was still acting as a tax agent in late 2020.

Background and procedural history

These proceedings result from an investigation carried out for Mr Zafiropoulos by a firm known as Infinity Financial (“Infinity”), which is described in the evidence as a “forensic accounting firm”. The investigation concerned tax payment accounts of Mr Zafiropoulos and related parties, including ZIPL, while FCPL was acting as those parties’ tax agent.
The evidence does not…

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.

Continue reading Zafiropoulos v Fragogianis

Details

AGLC: Zafiropoulos v Fragogianis [2024] NSWSC 309
Case: [2024] NSWSC 309
Decision Date: 26 March 2024

CaseChat Overview and Summary

In the case of Zafiropoulos v Fragogianis, the plaintiff sought to obtain asset preservation orders against the defendants and a third party. The case was heard in the Federal Court of Australia. The dispute arose from a claim for damages for breach of fiduciary duty, conspiracy to defraud, and negligence. The plaintiff sought the orders to protect against dissipation of assets, pending the outcome of the main proceedings.

The legal issues before the court included whether the application for asset preservation orders was reasonable, and who should bear the costs of the application. The court needed to determine whether the application for the orders was reasonable, considering the evidence available at the time, and whether the costs should follow the event or be borne by the applicants. The court also had to consider whether the applicants were entitled to a lump sum payment on account of their costs liability.

The court found that the application for the asset preservation orders was not reasonable, as it was made without full disclosure of the evidence by the applicants. The court noted that the application was abandoned once the respondents served their evidence, indicating that the orders were no longer necessary. The court held that the costs of the application should follow the event, and ordered the applicants to pay the costs of the application, as well as a lump sum on account of their costs liability. This decision highlights the importance of ensuring that applications for interlocutory relief are made with full disclosure of the evidence, and that the costs of such applications are carefully considered.

Orders