Gazebo Hotels Pty Ltd v Bugledich [2002] FCA 1412

Gazebo Hotels Pty Ltd v Bugledich [2002] FCA 1412

The applicant's failure to dispute the respondent's assertion that it was not a trading entity and that its major asset was no longer in existence provided credible testimony enlivening the discretion under s 1335 of the Corporations Act. The undertaking offered by the applicant did not provide adequate immediate security because the Court could not be satisfied that the financial position of the entity offering the undertaking would remain unchanged or that other circumstances would not render the security inadequate. In the absence of evidence that cash security would stultify the proceedings, the appropriate form of security was a cash deposit, fixed at $30,000 on the limited evidence...

Jurisdiction
Australia
Judgment Date
06 November 2002
Procedural Posture
Notice of Motion for Security for Costs Under S 1335 of the Corporations Act / Motion Heard Before the Hearing of the Proceedings Fixed for 18 November 2002
Outcome
Security for costs ordered in favour of the respondent.
Legal Topics
['security for Costs' 'corporate Applicant' 'form of Security' 'cash Deposit' 'undertakings as Security']
['civil Procedure' 'corporations Law' 'costs'] ['security for Costs' 'corporate Applicant' 'form of Security' 'cash Deposit' 'undertakings as Security']

Case Brief

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Procedural Posture

Notice of Motion for Security for Costs Under S 1335 of the Corporations Act / Motion Heard Before the Hearing of the Proceedings Fixed for 18 November 2002

Legal Issues

  1. 1 ["Whether there was credible testimony giving reason to believe the applicant would be unable to pay the respondent's costs if the respondent successfully defended the proceedings." 'Whether security for costs should be provided by undertaking or by cash deposit.' 'What amount of security should be ordered.']

Ratio Decidendi

The applicant's failure to dispute the respondent's assertion that it was not a trading entity and that its major asset was no longer in existence provided credible testimony enlivening the discretion under s 1335 of the Corporations Act. The undertaking offered by the applicant did not provide adequate immediate security because the Court could not be satisfied that the financial position of the entity offering the undertaking would remain unchanged or that other circumstances would not render the security inadequate. In the absence of evidence that cash security would stultify the proceedings, the appropriate form of security was a cash deposit, fixed at $30,000 on the limited evidence...

Court Disposition

Security for costs ordered in favour of the respondent.

Orders

  • ["The applicant, on or before Friday 15 November 2002, provide by way of a cash deposit with the Court, security for the respondent's costs of these proceedings in the amount of $30,000." "The security for costs referred to in order 1 would be the applicant's security for the costs of the proceeding up to the...