Professional Vending Services Pty Ltd v Christou [2010] FCA 580

Professional Vending Services Pty Ltd v Christou [2010] FCA 580

There is a risk that Professional Vending Services Pty Ltd will not be able to meet an adverse costs order given the financial evidence and the likely high legal costs coinciding with modest profitability and net assets. The threshold for ordering security for costs is satisfied, and balancing justice between parties, security is ordered in staged payments totalling $42,000.

Parties
First Applicant: Professional Vending Services Pty Ltd; Second Applicant: Amina & Asfalia Pty Ltd; First Respondent: Jim Christou; Second Respondent: Australian Automatic Vending Company Pty Ltd; Third Respondent: Gail Christou
Jurisdiction
Australia
Judgment Date
10 June 2010
Procedural Posture
Security for Costs Application / Post Motion, Orders Made
Outcome
Security for costs ordered against the first applicant; costs application reserved; prior Registrar orders set aside.
Legal Topics
Security for Costs, Financial Capacity of Corporation, Discretion in Security for Costs
Corporations Law Civil Procedure Security for Costs Financial Capacity of Corporation Discretion in Security for Costs

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Parties

Professional Vending Services Pty Ltd

First Applicant

Amina & Asfalia Pty Ltd

Second Applicant

Jim Christou

First Respondent

Australian Automatic Vending Company Pty Ltd

Second Respondent

Gail Christou

Third Respondent

Procedural Posture

Security for Costs Application / Post Motion, Orders Made

Legal Issues

  1. 1 Whether the applicant corporations should provide security for costs under s 1335(1) of the Corporations Act
  2. 2 Whether there is reason to believe Professional Vending Services Pty Ltd will be unable to pay the respondents’ costs if so ordered
  3. 3 How to exercise the Court’s discretion in circumstances bordering on financial capability

Ratio Decidendi

There is a risk that Professional Vending Services Pty Ltd will not be able to meet an adverse costs order given the financial evidence and the likely high legal costs coinciding with modest profitability and net assets. The threshold for ordering security for costs is satisfied, and balancing justice between parties, security is ordered in staged payments totalling $42,000.

Court Disposition

Security for costs ordered against the first applicant; costs application reserved; prior Registrar orders set aside.

Orders

  • The applicant provide security for the first and second respondents' costs up to and including the first day of trial in the amount of $42,000, payable by four instalments ($10,000 by 24 June 2010; $10,000 by 19 July 2010; $10,000 by 16 August 2010; $12,000 by 13 September 2010).
  • Payments to be held as agreed in writing or as satisfactory to Registrar.