Tyne v UBS AG [2014] FCA 1073

Tyne v UBS AG [2014] FCA 1073

Although UBS faced a real risk of non-recovery because Mr Tyne was bankrupt and the Argot Trust appeared to have no assets, the Court was not satisfied at this stage that the prior litigation or alleged weaknesses in the pleading justified ordering security. Any substantial security order would stultify the first applicant's claim; there was at least an arguable pleaded causal link between UBS's alleged conduct and the impecuniosity; and the second applicant's claim would remain to be litigated in any event. The appropriate course was therefore to adjourn the security application and require production of the Trust Deed and financial statements before final orders.

Jurisdiction
Australia
Judgment Date
03 October 2014
Procedural Posture
Interlocutory Application for Security for Costs in Federal Court Proceeding / Respondent's Application for Security for Costs and Stay Pending Provision of Security; Application Adjourned Generally
Outcome
The respondent's application for security for costs was adjourned generally; no security was ordered at this stage and costs were reserved.
Legal Topics
['security for Costs' 'impecuniosity of Trustee' 'stultification of Proceedings' "trustee's Right of Indemnity" 'prior Foreign and New South Wales Proceedings' 'anti Suit Injunction' 'res Judicata and Issue Estoppel Contentions']
['practice and Procedure' 'costs' 'trusts' 'civil Procedure'] ['security for Costs' 'impecuniosity of Trustee' 'stultification of Proceedings' "trustee's Right of Indemnity" 'prior Foreign and New South Wales Proceedings' 'anti Suit Injunction' 'res Judicata and Issue Estoppel Contentions']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Interlocutory Application for Security for Costs in Federal Court Proceeding / Respondent's Application for Security for Costs and Stay Pending Provision of Security; Application Adjourned Generally

Legal Issues

  1. 1 ["Whether the first applicant, as trustee of the Argot Trust, should be ordered to provide security for UBS's costs in the amount of $450,000.00 or another amount." 'Whether the principal proceeding should be stayed pending provision of security.' "Whether the first applicant's impecuniosity and the absence of trust assets justified security for costs." "Whether making a security order would stultify or foreclose the first applicant's proceeding." "Whether the alleged conduct of UBS was at least arguably the cause of the first applicant's and the Argot Trust's impecuniosity." 'What weight should be given to prior Singapore and New South Wales litigation, including anti-suit injunction, stay, res judicata and issue estoppel contentions.' 'What effect the continuing claim of the second applicant, against whom no security was sought, had on the exercise of discretion.']

Ratio Decidendi

Although UBS faced a real risk of non-recovery because Mr Tyne was bankrupt and the Argot Trust appeared to have no assets, the Court was not satisfied at this stage that the prior litigation or alleged weaknesses in the pleading justified ordering security. Any substantial security order would stultify the first applicant's claim; there was at least an arguable pleaded causal link between UBS's alleged conduct and the impecuniosity; and the second applicant's claim would remain to be litigated in any event. The appropriate course was therefore to adjourn the security application and require production of the Trust Deed and financial statements before final orders.

Court Disposition

The respondent's application for security for costs was adjourned generally; no security was ordered at this stage and costs were reserved.

Orders

  • ['The application for security for costs made by the respondent is adjourned generally.' 'The first applicant is directed to file in the Court and serve upon the respondent, within 30 days, an affidavit exhibiting: (a) a copy of the Trust Deed for the Argot Unit Trust; (b) a copy of the profit and loss statements...