Sanum-Kehlbeck GMBH & Co KG V Sanum Australia Pty Ltd [2009] NSWSC 690

Sanum-Kehlbeck GMBH & Co KG V Sanum Australia Pty Ltd [2009] NSWSC 690

Sanum Australia's only substantive opposition was on a genuine standing issue and it effectively capitulated after that issue was decided against it, so no abuse of process under rule 42.3.2(c) was established. However, Dr Seeger instructed solicitors for Sanum Australia without the necessary authority and caused the company to defend in substance to protect his own interests in a dispute between shareholders. The case therefore fell within rule 42.3.2(d), and discretion favoured making Dr Seeger bear all of the plaintiff's costs because an order against the company would effectively leave Sanum-Kehlbeck bearing 51% of the burden itself. No sufficient delinquency justified indemnity costs.

Jurisdiction
Australia
Judgment Date
23 July 2009
Procedural Posture
Application for Non Party Costs Order in Winding Up Proceedings / Principal Judgment on Costs After Winding Up Order
Outcome
Application for a non-party costs order granted on the party/party basis; indemnity costs refused.
Legal Topics
['costs' 'non Party Costs Orders' 'winding Up' 'abuse of Process' "authority to Conduct Proceedings in Another Person's Name"]
['civil Procedure' 'corporations'] ['costs' 'non Party Costs Orders' 'winding Up' 'abuse of Process' "authority to Conduct Proceedings in Another Person's Name"]

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Procedural Posture

Application for Non Party Costs Order in Winding Up Proceedings / Principal Judgment on Costs After Winding Up Order

Legal Issues

  1. 1 ["Whether Dr Hilbert Seeger, a non-party to the winding up proceedings, should pay Sanum-Kehlbeck's costs of the proceedings as a whole." "Whether Sanum Australia's opposition to the winding up application, allegedly caused by Dr Seeger, was an abuse of process within rule 42.3.2(c) of the Uniform Civil Procedure Rules 2005." 'Whether Dr Seeger purported, without authority, to conduct proceedings in the name of Sanum Australia within rule 42.3.2(d) of the Uniform Civil Procedure Rules 2005.' 'Whether any costs ordered against Dr Seeger should be assessed on the indemnity basis.']

Ratio Decidendi

Sanum Australia's only substantive opposition was on a genuine standing issue and it effectively capitulated after that issue was decided against it, so no abuse of process under rule 42.3.2(c) was established. However, Dr Seeger instructed solicitors for Sanum Australia without the necessary authority and caused the company to defend in substance to protect his own interests in a dispute between shareholders. The case therefore fell within rule 42.3.2(d), and discretion favoured making Dr Seeger bear all of the plaintiff's costs because an order against the company would effectively leave Sanum-Kehlbeck bearing 51% of the burden itself. No sufficient delinquency justified indemnity costs.

Court Disposition

Application for a non-party costs order granted on the party/party basis; indemnity costs refused.

Orders

  • ["Dr Hilbert Seeger pay the plaintiff's costs of the proceedings as a whole, such costs to be assessed on the party/party basis."]