Capital Options (Aust) Pty Ltd v Hazratwala, in the matter of Weststate Consortium Pty Ltd (in liq) (No 2) [2023] FCA 775

Capital Options (Aust) Pty Ltd v Hazratwala, in the matter of Weststate Consortium Pty Ltd (in liq) (No 2) [2023] FCA 775

Indemnity costs were warranted because Capital Options' non-disclosure and predominant pursuit of the summonses for its own benefit amounted to an abuse of process and its opposition disregarded known facts and the consequence that the Registrar's order would almost invariably be set aside. Mr Bax was jointly and severally liable as a non-party because he was the sole director and shareholder of a company with paid share capital of $3 and no evidence of other assets, was the source of litigation funds, personally swore affidavits containing material non-disclosures, conducted the Registrar proceedings, refused disclosure to the defendants, and had a clear interest in proceedings pursued...

Jurisdiction
Australia
Judgment Date
07 July 2023
Procedural Posture
Costs Application in Corporations and Corporate Insolvency Proceeding / Following Judgment Setting Aside Summonses for Public Examinations and Dismissing the Originating Application; Determined on the Papers
Outcome
Application upheld; indemnity costs ordered against Capital Options and non-party Craig Stephen Bax jointly and severally, with costs to be fixed in a lump sum.
Legal Topics
['indemnity Costs' 'abuse of Process' 'ulterior Purpose' 'non Party Costs Order' 'lump Sum Costs']
['costs' 'corporations and Corporate Insolvency' 'federal Court Procedure'] ['indemnity Costs' 'abuse of Process' 'ulterior Purpose' 'non Party Costs Order' 'lump Sum Costs']

Case Brief

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Procedural Posture

Costs Application in Corporations and Corporate Insolvency Proceeding / Following Judgment Setting Aside Summonses for Public Examinations and Dismissing the Originating Application; Determined on the Papers

Legal Issues

  1. 1 ["Whether Capital Options should pay the defendants' and sixth defendant's costs on an indemnity basis." 'Whether Craig Stephen Bax, a non-party director and shareholder of Capital Options, should be jointly and severally liable for those costs.' 'Whether the costs should be fixed in a lump sum.']

Ratio Decidendi

Indemnity costs were warranted because Capital Options' non-disclosure and predominant pursuit of the summonses for its own benefit amounted to an abuse of process and its opposition disregarded known facts and the consequence that the Registrar's order would almost invariably be set aside. Mr Bax was jointly and severally liable as a non-party because he was the sole director and shareholder of a company with paid share capital of $3 and no evidence of other assets, was the source of litigation funds, personally swore affidavits containing material non-disclosures, conducted the Registrar proceedings, refused disclosure to the defendants, and had a clear interest in proceedings pursued...

Court Disposition

Application upheld; indemnity costs ordered against Capital Options and non-party Craig Stephen Bax jointly and severally, with costs to be fixed in a lump sum.

Orders

  • ['Capital Options (Aust) Pty Ltd pay the costs of the first, second, third, fifth, and sixth defendants of and incidental to the interlocutory application filed on 18 January 2023 on an indemnity basis.' 'Craig Stephen Bax be liable, jointly and severally with Capital Options (Aust) Pty Ltd, to pay the costs...