Peters v Coastace [2006] NSWSC 289

Peters v Coastace [2006] NSWSC 289

Mr Bate, as opposing shareholder/director in a deadlocked company where the plaintiff sought to use the company's name to sue him, was a person who ought to have been joined and would otherwise be a proper party. Mrs Bate, although not a shareholder or director, was a necessary defendant to the proposed derivative proceeding and had intermeddled in the leave proceeding in a defendant-like role, so she also ought to have been joined. Rule 6.26 did not prevent joinder because both would otherwise be proper parties, and once joined they were amenable to a costs order under s 98 and Rule 42.3. Given the plaintiff's success and their substantial defendant-like participation, they should pay...

Jurisdiction
Australia
Judgment Date
13 April 2006
Procedural Posture
Application Under S 237 of the Corporations Act 2001 (cth) for Leave to Commence a Derivative Proceeding on Behalf of Coastace Pty Ltd / Further Hearing on Joinder and Costs After Leave Under S 237 Had Been Granted
Outcome
Mr and Mrs Bate were joined as defendants and ordered to pay the plaintiff's costs of the proceeding.
Legal Topics
['derivative Proceedings' 'joinder of Parties' 'costs Against Interested Parties' 'non Party Costs' 'deadlocked Company']
['corporations' 'civil Procedure' 'costs'] ['derivative Proceedings' 'joinder of Parties' 'costs Against Interested Parties' 'non Party Costs' 'deadlocked Company']

Case Brief

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Procedural Posture

Application Under S 237 of the Corporations Act 2001 (cth) for Leave to Commence a Derivative Proceeding on Behalf of Coastace Pty Ltd / Further Hearing on Joinder and Costs After Leave Under S 237 Had Been Granted

Legal Issues

  1. 1 ["Whether Mr and Mrs Bate, who appeared as interested parties but were not formally joined, could be ordered to pay the plaintiff's costs of the s 237 leave proceeding." 'Whether Mr and Mrs Bate should be joined as defendants when the only remaining issue in the proceeding was costs.' 'Whether the plaintiff should receive an immediate costs order before resolution of the derivative proceeding and before an application for appointment of a provisional liquidator.']

Ratio Decidendi

Mr Bate, as opposing shareholder/director in a deadlocked company where the plaintiff sought to use the company's name to sue him, was a person who ought to have been joined and would otherwise be a proper party. Mrs Bate, although not a shareholder or director, was a necessary defendant to the proposed derivative proceeding and had intermeddled in the leave proceeding in a defendant-like role, so she also ought to have been joined. Rule 6.26 did not prevent joinder because both would otherwise be proper parties, and once joined they were amenable to a costs order under s 98 and Rule 42.3. Given the plaintiff's success and their substantial defendant-like participation, they should pay...

Court Disposition

Mr and Mrs Bate were joined as defendants and ordered to pay the plaintiff's costs of the proceeding.

Orders

  • ['Rodney Charles Bate and Felicity Catherine Bate joined as defendants to the proceeding.' "Rodney Charles Bate and Felicity Catherine Bate to pay the plaintiff's costs of the proceeding, including the costs of the interlocutory application for injunctions."]