Laith & Fadi Investments Pty Ltd v Fogo Brazilia Holdings Pty Ltd [2024] NSWSC 1508

Laith & Fadi Investments Pty Ltd v Fogo Brazilia Holdings Pty Ltd [2024] NSWSC 1508

The Court held that security for costs should be ordered against the lead plaintiffs, to be paid in instalments in advance of major trial milestones. This was because the plaintiffs are impecunious, suing for the benefit of others, and failed to provide sufficient evidence of the inability (as distinct from unwillingness) of themselves or group members to provide security. The previous litigation funding was not terminated due to defendants’ conduct, and the risk of injustice to defendants without security outweighed the risk of stultifying the proceeding. The quantum of security was set by a broad brush assessment, less than the amounts sought by defendants but more than the figures put...

Parties
First Plaintiff: Laith & Fadi Investments Pty Ltd; Second Plaintiff: Laith Karim Hana; First Defendant: Fogo Brazilia Holdings Pty Ltd; Second Defendant: Ian David Dresner; Third Defendant: Hilton Seskin; Fourth Defendant: Lazarus Legal Group Pty Ltd
Jurisdiction
Australia
Judgment Date
28 November 2024
Procedural Posture
Representative Proceedings (class Action) / Security for Costs Application (pre Trial, After Close of Pleadings, Prior to Trial
Outcome
Order for security for costs (in instalments); proceedings stayed if instalments not paid; orders for payment of defendants' costs of applications.
Legal Topics
Security for Costs, Impecuniosity, Representative Party Liability, Funding Agreements, Stultification of Proceedings
Civil Procedure Costs Representative Proceedings Security for Costs Impecuniosity Representative Party Liability Funding Agreements Stultification of Proceedings

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 5 Authorities cited 28 Party arguments 2 Amounts and remedies 12
Sign in to unlock

Parties

Laith & Fadi Investments Pty Ltd

First Plaintiff

Laith Karim Hana

Second Plaintiff

Fogo Brazilia Holdings Pty Ltd

First Defendant

Ian David Dresner

Second Defendant

Hilton Seskin

Third Defendant

Lazarus Legal Group Pty Ltd

Fourth Defendant

Procedural Posture

Representative Proceedings (class Action) / Security for Costs Application (pre Trial, After Close of Pleadings, Prior to Trial

Legal Issues

  1. 1 Whether further security for costs should be ordered against the lead plaintiffs in representative proceedings
  2. 2 Whether the inability or unwillingness of plaintiffs and group members to provide security for costs should result in a stay
  3. 3 Quantum and manner of providing further security for costs

Ratio Decidendi

The Court held that security for costs should be ordered against the lead plaintiffs, to be paid in instalments in advance of major trial milestones. This was because the plaintiffs are impecunious, suing for the benefit of others, and failed to provide sufficient evidence of the inability (as distinct from unwillingness) of themselves or group members to provide security. The previous litigation funding was not terminated due to defendants’ conduct, and the risk of injustice to defendants without security outweighed the risk of stultifying the proceeding. The quantum of security was set by a broad brush assessment, less than the amounts sought by defendants but more than the figures put...

Court Disposition

Order for security for costs (in instalments); proceedings stayed if instalments not paid; orders for payment of defendants' costs of applications.

Orders

  • Plaintiffs to pay $1,300,000 as security for the costs of the first and second defendants, by instalments: $520,000 within 14 days, $260,000 before first expert report, $520,000 before trial.
  • Plaintiffs to pay $900,000 as security for the costs of the third defendant, by instalments: $360,000 within 14 days, $180,000 before first expert report, $360,000 before trial.