GRAMMER AND ORS v BAILEY AND ORS [2011] NSWSC 513

GRAMMER AND ORS v BAILEY AND ORS [2011] NSWSC 513

The proceedings in the Mining Warden's Court commenced purportedly by Namoi Valley Aquafarming Pty Ltd were not authorised by the company; Steven Grammer had no actual authority to institute them, and Michael McHugh and The Law Company Pty Ltd acted without the company's authority. Accordingly, both Grammer and McHugh (and TLC) are personally liable for the costs pursuant to the orders; proper ratification did not occur, and Grammer was not entitled to indemnify McHugh/TLC, nor was he entitled to indemnity from the Von Hartens.

Parties
Plaintiff: Steven Charles Grammer; Plaintiff: Michael McHugh; Plaintiff: The Law Company Pty Ltd; Defendant: Mining Warden Bailey; Defendant: Namoi Valley Aquafarming Pty Ltd; Defendant: Eastern Star Gas Limited; Defendant: Ronald Von Harten; Defendant: Dean Von Harten
Jurisdiction
Australia
Judgment Date
03 June 2011
Procedural Posture
Costs Application / Principal Judgment After Transfer From Mining Warden's Court
Outcome
Costs ordered against individuals and company; proceedings dismissed; liberty to apply granted; stay of enforcement of orders pending payment and possible later variation.
Legal Topics
Authority to Commence Proceedings, Costs Orders, Director Powers, Litigation Without Authority, Ratification, Indemnity Costs
Corporations Civil Procedure Authority to Commence Proceedings Costs Orders Director Powers Litigation Without Authority Ratification Indemnity Costs

Case Brief

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Parties

Steven Charles Grammer

Plaintiff

Michael McHugh

Plaintiff

The Law Company Pty Ltd

Plaintiff

Mining Warden Bailey

Defendant

Namoi Valley Aquafarming Pty Ltd

Defendant

Eastern Star Gas Limited

Defendant

Ronald Von Harten

Defendant

Dean Von Harten

Defendant

Procedural Posture

Costs Application / Principal Judgment After Transfer From Mining Warden's Court

Legal Issues

  1. 1 Whether the Mining Warden's Court proceedings were properly authorised by Namoi Valley Aquafarming Pty Ltd
  2. 2 Whether Steven Grammer had authority to commence litigation
  3. 3 Whether Michael McHugh and The Law Company Pty Ltd acted with authority

Ratio Decidendi

The proceedings in the Mining Warden's Court commenced purportedly by Namoi Valley Aquafarming Pty Ltd were not authorised by the company; Steven Grammer had no actual authority to institute them, and Michael McHugh and The Law Company Pty Ltd acted without the company's authority. Accordingly, both Grammer and McHugh (and TLC) are personally liable for the costs pursuant to the orders; proper ratification did not occur, and Grammer was not entitled to indemnify McHugh/TLC, nor was he entitled to indemnity from the Von Hartens.

Court Disposition

Costs ordered against individuals and company; proceedings dismissed; liberty to apply granted; stay of enforcement of orders pending payment and possible later variation.

Orders

  • Michael McHugh and The Law Company Pty Ltd to pay 50% of the costs of Eastern Star Gas Limited of the proceedings in the Narrabri Mining Warden's Court, on an indemnity basis.
  • Steven Grammer to pay the costs of Eastern Star Gas Limited of the proceedings in the Narrabri Mining Warden's Court.