A1 Catering Services Pty Ltd v Manassen Holdings Pty Ltd (No 2) [2024] NSWSC 530

A1 Catering Services Pty Ltd v Manassen Holdings Pty Ltd (No 2) [2024] NSWSC 530

The contractual indemnities in cl 13.1 of the loan agreement and cll 17.1–17.3 of the general security deed were not limited to reasonable legal costs and expressly covered costs on a solicitor and own client or full indemnity basis. Manassen's defence of A1 Catering's claim for return of the $300,000 Security was in connection with the preservation and exercise of rights under the Transaction Documents. No discretionary factor relied on by A1 Catering justified departing from Manassen's contractual entitlement, so A1 Catering was ordered to pay Manassen's costs on an indemnity basis.

Jurisdiction
Australia
Judgment Date
03 May 2024
Procedural Posture
Costs / On the Papers After Judgment Dated 27 February 2024
Outcome
Plaintiff to pay the second defendant's costs on an indemnity basis.
Legal Topics
['indemnity Costs' 'contractual Costs Indemnity' 'security for Costs' 'loan Documents' 'exercise of Costs Discretion']
['costs' 'civil Procedure' 'contract'] ['indemnity Costs' 'contractual Costs Indemnity' 'security for Costs' 'loan Documents' 'exercise of Costs Discretion']

Case Brief

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Procedural Posture

Costs / On the Papers After Judgment Dated 27 February 2024

Legal Issues

  1. 1 ["Whether the plaintiff should pay the second defendant's costs on the ordinary basis or on an indemnity basis." 'Whether the contractual costs clauses in the loan agreement and general security deed applied to costs incurred in defending the claim for return of the Security.' "Whether discretionary factors relied on by the plaintiff justified departing from the second defendant's contractual entitlement to indemnity costs."]

Ratio Decidendi

The contractual indemnities in cl 13.1 of the loan agreement and cll 17.1–17.3 of the general security deed were not limited to reasonable legal costs and expressly covered costs on a solicitor and own client or full indemnity basis. Manassen's defence of A1 Catering's claim for return of the $300,000 Security was in connection with the preservation and exercise of rights under the Transaction Documents. No discretionary factor relied on by A1 Catering justified departing from Manassen's contractual entitlement, so A1 Catering was ordered to pay Manassen's costs on an indemnity basis.

Court Disposition

Plaintiff to pay the second defendant's costs on an indemnity basis.

Orders

  • ["The plaintiff is to pay the second defendant's costs of the proceedings on an indemnity basis."]