Shi v Benhamou Designs Pty Ltd [2017] NSWSC 735

Shi v Benhamou Designs Pty Ltd [2017] NSWSC 735

Ms Shi did not satisfy the threshold requirement for security for costs because the unanswered solvency request, thin capitalisation, an unrelated judgment debt, and possible supplier disputes did not provide sufficient evidence, even on the low threshold, to establish reason to believe that Benhamou Designs would be unable to pay an adverse costs order.

Jurisdiction
Australia
Judgment Date
07 June 2017
Procedural Posture
Application for Security for Costs / Amended Notice of Motion Dated 4 May 2017 Heard and Dismissed
Outcome
Application for security for costs dismissed.
Legal Topics
['security for Costs Against a Cross Claimant' 'reason to Believe a Corporation Will Be Unable to Pay Adverse Costs' 'evidentiary Burden on Applicant for Security' 'discretion Where Cross Claimant Is Essentially in Position of Defendant']
['practice and Procedure' 'costs' 'security for Costs'] ['security for Costs Against a Cross Claimant' 'reason to Believe a Corporation Will Be Unable to Pay Adverse Costs' 'evidentiary Burden on Applicant for Security' 'discretion Where Cross Claimant Is Essentially in Position of Defendant']

Case Brief

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Procedural Posture

Application for Security for Costs / Amended Notice of Motion Dated 4 May 2017 Heard and Dismissed

Legal Issues

  1. 1 ['Whether Ms Shi established reason to believe that Benhamou Designs Pty Ltd would be unable to pay the costs of the litigation if unsuccessful.' "Whether Benhamou Designs' failure to respond to a request for evidence of solvency permitted an inference that it could not meet an adverse costs order." "Whether, if the threshold were met, security should be ordered where the cross-claim was essentially defensive and arose from substantially the same factual matrix as Ms Shi's claim."]

Ratio Decidendi

Ms Shi did not satisfy the threshold requirement for security for costs because the unanswered solvency request, thin capitalisation, an unrelated judgment debt, and possible supplier disputes did not provide sufficient evidence, even on the low threshold, to establish reason to believe that Benhamou Designs would be unable to pay an adverse costs order.

Court Disposition

Application for security for costs dismissed.

Orders

  • ['Application for security for costs dismissed.' "Cross-Defendant pay the Cross-Claimant's costs of the amended notice of motion dated 4 May 2017 insofar as they relate to the application for security for costs." 'Otherwise costs be costs in the cause.']