Friendly Inn Holdings Pty Ltd v St George Bank [2012] NSWSC 441

Friendly Inn Holdings Pty Ltd v St George Bank [2012] NSWSC 441

Although the plaintiff companies were persons of straw and Mr Rutter directed and funded their claims as sole director and shareholder, that was insufficient to make him liable for the defendants' costs as a non-party. The additional matters relied on did not amount to an abuse of process or otherwise justify a costs order against him. However, the finding that Mr Rutter and others concealed information from the bank so that the plaintiffs could remain in occupation of the hotel constituted sufficient delinquency to justify indemnity costs against the plaintiffs from 9 February 2011.

Jurisdiction
Australia
Judgment Date
17 April 2012
Procedural Posture
Costs; Non Party Costs Motion / Ex Tempore Judgment on Further Amended Notice of Motion
Outcome
Further amended notice of motion otherwise dismissed; no costs order made against Bryan Anthony Rutter; plaintiffs ordered to pay defendants' costs as specified.
Legal Topics
['non Party Costs' 'indemnity Costs' 'security for Costs' 'companies of Straw' 'shareholder Funding of Litigation']
['civil Procedure' 'costs'] ['non Party Costs' 'indemnity Costs' 'security for Costs' 'companies of Straw' 'shareholder Funding of Litigation']

Case Brief

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Procedural Posture

Costs; Non Party Costs Motion / Ex Tempore Judgment on Further Amended Notice of Motion

Legal Issues

  1. 1 ["Whether Bryan Anthony Rutter, a non-party sole shareholder who funded the proceedings and paid security for costs, should pay the defendants' costs of the proceedings." "Whether the defendants' costs should be paid on the indemnity basis."]

Ratio Decidendi

Although the plaintiff companies were persons of straw and Mr Rutter directed and funded their claims as sole director and shareholder, that was insufficient to make him liable for the defendants' costs as a non-party. The additional matters relied on did not amount to an abuse of process or otherwise justify a costs order against him. However, the finding that Mr Rutter and others concealed information from the bank so that the plaintiffs could remain in occupation of the hotel constituted sufficient delinquency to justify indemnity costs against the plaintiffs from 9 February 2011.

Court Disposition

Further amended notice of motion otherwise dismissed; no costs order made against Bryan Anthony Rutter; plaintiffs ordered to pay defendants' costs as specified.

Orders

  • ["The plaintiffs are to pay the defendants' costs of the proceedings on the ordinary basis until 8 February 2011." "The plaintiffs are to pay the defendants' costs of the proceedings on the indemnity basis from 9 February 2011." 'The further amended notice of motion is otherwise dismissed with no order as to costs.']