ACN 153 364 491 Ltd (in liq) v GP No 1 (in liq), in the matter of GP No 1 (in liq) [2018] FCA 1933

ACN 153 364 491 Ltd (in liq) v GP No 1 (in liq), in the matter of GP No 1 (in liq) [2018] FCA 1933

Security for costs in the amount of $15,000 should be provided by the plaintiff because it is in liquidation, has no available funds to pay a potential costs order, and the discretion under s 1335(1) is engaged; the fact that the impecuniosity is due to the defendants’ non-payment does not preclude the making of an order for security. Security will not be refused merely because it might stifle the proceedings where the statutory requirements are satisfied and the other discretionary matters do not outweigh the interests of justice.

Parties
Plaintiff: ACN 153 364 491 Ltd (in liquidation); First Defendant: GP No 1 Pty Ltd (in liquidation); Second Defendant: Gavin Moss
Jurisdiction
Australia
Judgment Date
06 December 2018
Procedural Posture
Application / Interlocutory (application for Security for Costs)
Outcome
Application for security for costs granted; plaintiff to provide security for costs in the amount of $15,000. No final orders made at this stage; parties to be heard as to the appropriate orders.
Legal Topics
Security for Costs, Liquidation, Priority of Creditors, External Administration
Corporations Law Insolvency Law Civil Procedure Security for Costs Liquidation Priority of Creditors External Administration

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Parties

ACN 153 364 491 Ltd (in liquidation)

Plaintiff

GP No 1 Pty Ltd (in liquidation)

First Defendant

Gavin Moss

Second Defendant

Procedural Posture

Application / Interlocutory (application for Security for Costs)

Legal Issues

  1. 1 Whether the plaintiff (a company in liquidation) should be ordered to provide security for costs under s 1335 of the Corporations Act 2001 (Cth)
  2. 2 Whether there is credible evidence that the plaintiff will be unable to pay the defendants' costs if so ordered
  3. 3 Whether ordering security for costs would stifle the proceedings given the plaintiff's impecuniosity

Ratio Decidendi

Security for costs in the amount of $15,000 should be provided by the plaintiff because it is in liquidation, has no available funds to pay a potential costs order, and the discretion under s 1335(1) is engaged; the fact that the impecuniosity is due to the defendants’ non-payment does not preclude the making of an order for security. Security will not be refused merely because it might stifle the proceedings where the statutory requirements are satisfied and the other discretionary matters do not outweigh the interests of justice.

Court Disposition

Application for security for costs granted; plaintiff to provide security for costs in the amount of $15,000. No final orders made at this stage; parties to be heard as to the appropriate orders.

Orders

  • The parties be heard as to the appropriate orders to be made in light of these reasons.