Sharjade v Darwinia Estate & Anor [2006] NSWSC 708

Sharjade v Darwinia Estate & Anor [2006] NSWSC 708

Security for costs should be ordered as plaintiff’s impecuniosity was not shown to be caused by defendants, security would not stultify litigation, and offers of personal undertakings by the directors did not provide sufficient assurance or substitute for security in the circumstances.

Parties
Plaintiff: Sharjade Pty Limited; First Defendant: Darwinia Estate Pty Limited; Second Defendant: Commonwealth of Australia
Jurisdiction
Australia
Judgment Date
07 July 2006
Procedural Posture
Application for Security for Costs / Ex Tempore Judgment on Security for Costs Application
Outcome
Orders for plaintiff to provide security for costs to defendants; proceedings adjourned for seven days to allow parties to agree on quantum or nominate a referee.
Legal Topics
Security for Costs, Impecuniosity of Plaintiff, Directors' Undertakings, Discretion to Order Security, Stultification of Litigation
Civil Procedure Corporate Law Security for Costs Impecuniosity of Plaintiff Directors' Undertakings Discretion to Order Security Stultification of Litigation

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Parties

Sharjade Pty Limited

Plaintiff

Darwinia Estate Pty Limited

First Defendant

Commonwealth of Australia

Second Defendant

Procedural Posture

Application for Security for Costs / Ex Tempore Judgment on Security for Costs Application

Legal Issues

  1. 1 Whether security for costs should be ordered against an impecunious plaintiff
  2. 2 Whether defendants caused plaintiff’s impecuniosity
  3. 3 Whether security would stultify the litigation

Ratio Decidendi

Security for costs should be ordered as plaintiff’s impecuniosity was not shown to be caused by defendants, security would not stultify litigation, and offers of personal undertakings by the directors did not provide sufficient assurance or substitute for security in the circumstances.

Court Disposition

Orders for plaintiff to provide security for costs to defendants; proceedings adjourned for seven days to allow parties to agree on quantum or nominate a referee.

Orders

  • Proceedings stood over for seven days for parties to bring in short minutes of order regarding quantum of security.
  • If parties do not agree, matter to be referred to a referee for inquiry and report on appropriate amount and staging of security.