Longjing Pty Ltd v Perpetual Nominees Ltd [2017] NSWSC 1690

Longjing Pty Ltd v Perpetual Nominees Ltd [2017] NSWSC 1690

Security for costs ought to be ordered where a corporate plaintiff cannot demonstrate the absence of means from those standing to benefit (including its solicitors acting on a deferred fee basis) and where evidence of inability, not mere unwillingness, to provide security has not been satisfactorily established. The solicitor's position as creditor and funder places it within the class of persons for whom the risk and burden of the litigation cannot be entirely shifted to the defendant. There is no principle excluding solicitor creditors from the general rule that parties who stand to benefit from litigation should shoulder its risks.

Jurisdiction
Australia
Judgment Date
08 December 2017
Procedural Posture
Application for Review of Registrar's Order for Security for Costs / Review of Registrar's Decision
Outcome
Registrar's order for security for costs confirmed on review; review application dismissed; costs of review to follow the event; monies paid as security to be released to the defendant.
Legal Topics
['security for Costs' 'corporate Plaintiff' 'stifling of Proceedings' 'solicitor Creditor Exception' 'discretionary Principles for Security' "review of Registrar's Decisions"]
['civil Procedure' 'equity'] ['security for Costs' 'corporate Plaintiff' 'stifling of Proceedings' 'solicitor Creditor Exception' 'discretionary Principles for Security' "review of Registrar's Decisions"]

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Procedural Posture

Application for Review of Registrar's Order for Security for Costs / Review of Registrar's Decision

Legal Issues

  1. 1 ["Whether the Court should confirm the Registrar's order that the plaintiff provide security for the defendant's costs." 'Whether an order for security for costs would stifle the proceedings and if so, if that is a discretionary factor against making the order.' "Whether a plaintiff's solicitor who is a creditor should be treated differently from a commercial creditor for the purpose of security for costs."]

Ratio Decidendi

Security for costs ought to be ordered where a corporate plaintiff cannot demonstrate the absence of means from those standing to benefit (including its solicitors acting on a deferred fee basis) and where evidence of inability, not mere unwillingness, to provide security has not been satisfactorily established. The solicitor's position as creditor and funder places it within the class of persons for whom the risk and burden of the litigation cannot be entirely shifted to the defendant. There is no principle excluding solicitor creditors from the general rule that parties who stand to benefit from litigation should shoulder its risks.

Court Disposition

Registrar's order for security for costs confirmed on review; review application dismissed; costs of review to follow the event; monies paid as security to be released to the defendant.

Orders

  • ["Confirm the Registrar's order for security for costs." 'Lift the stay on the order for provision of security, with a fresh timetable to be provided for the payments.' 'Dismiss the review application.' 'Order that costs of the review application follow the event and that security paid into Court be released to...