IMF (Australia) Ltd v Meadow Springs Fairway Resort Ltd (In Liquidation) (No 2)[2009] FCAFC 69

IMF (Australia) Ltd v Meadow Springs Fairway Resort Ltd (In Liquidation) (No 2)[2009] FCAFC 69

The offer of compromise made by IMF was a genuine offer constituting a significant compromise, and its non-acceptance entitled IMF to indemnity costs from the date of the offer under O 23 r 11, but only in respect of the first instance proceeding—the presumption did not extend to the appeal. The priority of competing claims on the liquidation fund was to be set out by substituting new orders reflecting the Full Court's conclusions, restoring the pre-judgment status where funds were paid out erroneously.

Parties
Appellant (wad 124 of 2008), Fourth Respondent (wad 134 of 2008): IMF (Australia) Ltd (ACN 067 298 088); First Respondent (wad 124 of 2008), Appellant (wad 134 of 2008): Meadow Springs Fairway Resort Ltd (In Liquidation) (ACN 084 358 592); Second Respondent (wad 124 of 2008), First Respondent (wad 134 of 2008): Balanced Securities Ltd (ACN 083 514 685); Third Respondents (wad 124 of 2008): Westralian Capital Holdings Pty Ltd (In Liquidation) (ACN 083 526 650); Third Respondents (wad 124 of 2008), Second Respondents (wad 134 of 2008): Knightsbridge Managed Funds (In Liquidation) (ACN 089 532 169); Third Respondents (wad 124 of 2008), Second Respondents (wad 134 of 2008): Knightsbridge Finance Pty Ltd (In Liquidation) (ACN 008 716 872); Fourth Respondents (wad 124 of 2008), Third Respondents (wad 134 of 2008): Hurly Investments Pty Ltd (ACN 082 972 067); Fourth Respondents (wad 124 of 2008), Third Respondents (wad 134 of 2008): Timothy Joseph Casey; Fifth Respondent (wad 124 of 2008): Brian McMaster (Liquidator of Meadow Springs Fairway Resort Ltd (In Liquidation))
Jurisdiction
Australia
Judgment Date
04 June 2009
Procedural Posture
Appeal / Judgment on Costs and Consequential Orders Following Prior Full Court Substantive Reasons
Outcome
Appeals allowed in part and dismissed in part; orders made to reflect priorities and costs in accordance with the Court's conclusions.
Legal Topics
Costs, Offers of Compromise, Liquidation, Priority of Claims, Winding Up, Litigation Funding
Civil Procedure Corporations Law Costs Offers of Compromise Liquidation Priority of Claims Winding Up Litigation Funding

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 12 Party arguments 2 Amounts and remedies 6
Sign in to unlock

Parties

IMF (Australia) Ltd (ACN 067 298 088)

Appellant (wad 124 of 2008), Fourth Respondent (wad 134 of 2008)

Meadow Springs Fairway Resort Ltd (In Liquidation) (ACN 084 358 592)

First Respondent (wad 124 of 2008), Appellant (wad 134 of 2008)

Balanced Securities Ltd (ACN 083 514 685)

Second Respondent (wad 124 of 2008), First Respondent (wad 134 of 2008)

Westralian Capital Holdings Pty Ltd (In Liquidation) (ACN 083 526 650)

Third Respondents (wad 124 of 2008)

Knightsbridge Managed Funds (In Liquidation) (ACN 089 532 169)

Third Respondents (wad 124 of 2008), Second Respondents (wad 134 of 2008)

Knightsbridge Finance Pty Ltd (In Liquidation) (ACN 008 716 872)

Third Respondents (wad 124 of 2008), Second Respondents (wad 134 of 2008)

Hurly Investments Pty Ltd (ACN 082 972 067)

Fourth Respondents (wad 124 of 2008), Third Respondents (wad 134 of 2008)

Timothy Joseph Casey

Fourth Respondents (wad 124 of 2008), Third Respondents (wad 134 of 2008)

Brian McMaster (Liquidator of Meadow Springs Fairway Resort Ltd (In Liquidation))

Fifth Respondent (wad 124 of 2008)

Procedural Posture

Appeal / Judgment on Costs and Consequential Orders Following Prior Full Court Substantive Reasons

Legal Issues

  1. 1 Whether a presumption of entitlement to indemnity costs arises under Order 23 rule 11 of the Federal Court Rules for an unaccepted offer of compromise in the circumstances of this case
  2. 2 Whether an offer of compromise made during first instance proceedings applies to costs incurred on appeal
  3. 3 Whether the offer constituted a genuine compromise or amounted to a demand for capitulation

Ratio Decidendi

The offer of compromise made by IMF was a genuine offer constituting a significant compromise, and its non-acceptance entitled IMF to indemnity costs from the date of the offer under O 23 r 11, but only in respect of the first instance proceeding—the presumption did not extend to the appeal. The priority of competing claims on the liquidation fund was to be set out by substituting new orders reflecting the Full Court's conclusions, restoring the pre-judgment status where funds were paid out erroneously.

Court Disposition

Appeals allowed in part and dismissed in part; orders made to reflect priorities and costs in accordance with the Court's conclusions.

Orders

  • The appeal (WAD 124 of 2008) be allowed.
  • Orders 2 to 6 made on 10 June 2008 in proceeding WAD 150 of 2007 set aside and replaced with orders as to priority of Fund distribution.