Token Imports Pty Limited v Tex n Jean Pty Limited; Airbait Pty Limited v Tex n Jean Pty Limited; Airbait Pty Limited v Philip Haron Smouha [2014] NSWSC 806

Token Imports Pty Limited v Tex n Jean Pty Limited; Airbait Pty Limited v Tex n Jean Pty Limited; Airbait Pty Limited v Philip Haron Smouha [2014] NSWSC 806

Security for costs against TNJ was refused because, although there was now reason to believe TNJ could not pay adverse costs and circumstances had materially changed, TNJ's cross-claim was primarily defensive and the further costs Airbait would incur would largely be costs of advancing its own claim and meeting the defence rather than defending the offensive aspects of the cross-claim. The delay in advancing the review applications also lacked sufficient explanation, though it would not alone have justified refusal. Additional security for Mr Smouha was ordered because consolidation and the expanded issues materially changed the basis of the original order and made the original security...

Jurisdiction
Australia
Judgment Date
30 May 2014
Procedural Posture
Interlocutory Applications / Review of Registrar's Orders Relating to Security for Costs
Outcome
Airbait's and Mr Graham's notices of motion filed 22 October 2012 were dismissed; Mr Smouha's application for additional security was allowed in part.
Legal Topics
['security for Costs' "review of Registrar's Orders" 'security for Cross Claim' 'defensive Cross Claim' 'consolidated Proceedings' 'trust Claims']
['civil Procedure' 'equity'] ['security for Costs' "review of Registrar's Orders" 'security for Cross Claim' 'defensive Cross Claim' 'consolidated Proceedings' 'trust Claims']

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Procedural Posture

Interlocutory Applications / Review of Registrar's Orders Relating to Security for Costs

Legal Issues

  1. 1 ["Whether security for costs should be ordered against TNJ in respect of its cross-claim where TNJ accepted there was reason to believe it could not pay Airbait's costs if ordered to do so." "Whether TNJ's cross-claim was essentially defensive in nature or made TNJ in substance a plaintiff." "Whether delay in bringing Airbait's and Mr Graham's review applications justified refusal of security." 'Whether a material change of circumstances justified increasing security for costs previously ordered in favour of Mr Smouha.']

Ratio Decidendi

Security for costs against TNJ was refused because, although there was now reason to believe TNJ could not pay adverse costs and circumstances had materially changed, TNJ's cross-claim was primarily defensive and the further costs Airbait would incur would largely be costs of advancing its own claim and meeting the defence rather than defending the offensive aspects of the cross-claim. The delay in advancing the review applications also lacked sufficient explanation, though it would not alone have justified refusal. Additional security for Mr Smouha was ordered because consolidation and the expanded issues materially changed the basis of the original order and made the original security...

Court Disposition

Airbait's and Mr Graham's notices of motion filed 22 October 2012 were dismissed; Mr Smouha's application for additional security was allowed in part.

Orders

  • ['The notices of motion brought by Airbait and by Mr Graham on 22 October 2012 be dismissed.' "In relation to the notice of motion filed for Mr Smouha, the plaintiff provide additional security for the defendant's costs in the sum of $90,000." 'The Court will hear the parties as to consequential orders, including...