Cultivaust Pty Ltd v Grain Pool Pty Ltd [2004] FCA 1366

Cultivaust Pty Ltd v Grain Pool Pty Ltd [2004] FCA 1366

Security for costs was ordered because, despite there being a bona fide and arguable appeal on a legal issue of significance, the appellant failed to provide sufficient evidence of its own, or its shareholders’, financial circumstances to demonstrate that a security order would stifle the appeal. The respondent was entitled to protection due to the real risk of an unsatisfied costs order, and public interest considerations were not sufficient to displace this.

Parties
Applicant: Cultivaust Pty Ltd; First Respondent: Grain Pool Pty Ltd; Second Respondent: State of Western Australia; Third Respondent: Attorney-General for the State of South Australia; Fourth Respondent: State of Tasmania
Jurisdiction
Australia
Judgment Date
14 October 2004
Procedural Posture
Appeal / Motion for Security for Costs in Appeal
Outcome
Security for costs ordered against applicant
Legal Topics
Security for Costs, Impecunious Corporate Appellant, Company Litigation, Public Interest in Appeals
Practice and Procedure Security for Costs Impecunious Corporate Appellant Company Litigation Public Interest in Appeals

Case Brief

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Parties

Cultivaust Pty Ltd

Applicant

Grain Pool Pty Ltd

First Respondent

State of Western Australia

Second Respondent

Attorney-General for the State of South Australia

Third Respondent

State of Tasmania

Fourth Respondent

Procedural Posture

Appeal / Motion for Security for Costs in Appeal

Legal Issues

  1. 1 Whether security for costs should be ordered against an impecunious corporate appellant in an appeal.
  2. 2 Which principles determine the grant and quantum of security for costs in the Federal Court.

Ratio Decidendi

Security for costs was ordered because, despite there being a bona fide and arguable appeal on a legal issue of significance, the appellant failed to provide sufficient evidence of its own, or its shareholders’, financial circumstances to demonstrate that a security order would stifle the appeal. The respondent was entitled to protection due to the real risk of an unsatisfied costs order, and public interest considerations were not sufficient to displace this.

Court Disposition

Security for costs ordered against applicant

Orders

  • The appellant give security for the first respondent's costs in a sum of $65,000 by way of bank guarantee in a form approved by the Registrar.
  • Security be provided on or before Friday, 17 December 2004.