Acohs Pty Ltd v Merck Pty Ltd & Ors [1997] FCA 573

Acohs Pty Ltd v Merck Pty Ltd & Ors [1997] FCA 573

Given the applicant, a company with limited assets, is likely to incur significant costs in the proceedings that may increase its indebtedness, and that the shareholders (potential real beneficiaries) are likely in a position to provide security but no evidence shows inability or stifling effect, it is proper to order security for costs, but with the amount discounted to reflect factors otherwise weighing against such an order.

Jurisdiction
Australia
Judgment Date
20 June 1997
Procedural Posture
Application for Security for Costs / Interlocutory
Outcome
Security for costs ordered against the applicant in the sum of $50,000; liberty reserved to apply to vary; costs reserved.
Legal Topics
['security for Costs' 'company Litigation' 'costs in Interlocutory Applications']
['practice and Procedure' 'corporations'] ['security for Costs' 'company Litigation' 'costs in Interlocutory Applications']

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 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Application for Security for Costs / Interlocutory

Legal Issues

  1. 1 ['Whether security for costs should be ordered against the applicant company under s 1335 of the Corporations Law and s 56 of the Federal Court of Australia Act 1976 (Cth)' 'Whether the financial circumstances of the applicant and its shareholders justify an order for security for costs' 'Whether security should be discounted due to potential oppressiveness or risk of stifling litigation']

Ratio Decidendi

Given the applicant, a company with limited assets, is likely to incur significant costs in the proceedings that may increase its indebtedness, and that the shareholders (potential real beneficiaries) are likely in a position to provide security but no evidence shows inability or stifling effect, it is proper to order security for costs, but with the amount discounted to reflect factors otherwise weighing against such an order.

Court Disposition

Security for costs ordered against the applicant in the sum of $50,000; liberty reserved to apply to vary; costs reserved.

Orders

  • ['Within 21 days, the applicant, ACOHS Pty Ltd, give security for costs of the respondents, Merck Pty Ltd; Michael Culver and Rick Biezen in the sum of $50,000 in the form of bank guarantee, cash or such other form of which the Registrar approves.' 'Liberty to apply is reserved generally but in particular for a...