At least two in three family law cases filed in the Federal Circuit and Family Court of Australia (“the Court”) allege one or more parties have experienced family violence during the relationship. This aspect of a family law matter often sees one or more parents fearing their child or children spending time with the other parent.
How time can be spent
When a case is judicially determined in the context of family violence concerns, the following options are usually considered by order of preference and may be used in combination:
What is Family Violence anyway?
The definition of family violence is broader than you might realise. Section 4AB of the Family Law Act 1975 (Cth) (“the Act”) lists some examples of behaviour that may constitute family violence, such as; assaults, stalking, repeated derogatory taunts, sexual assaults, sexually abusive behaviour, intentional damage to property or an animal, unreasonable financial control, isolation from other family and friends and controlling one’s freedom unlawfully.
Effect on Parental Capacity and Co-Parenting
Parenting after separation can be challenging at the best of times, but that is especially so when there are allegations of family violence. So, can you seek orders that limit a child spending time with a parent because of the stress and anxiety it may cause you or the child due to a history family violence? –As is so often the case with these things…it depends.
This issue was discussed in a case called Re Andrew [1996] FamCA 43, where the appellant father was not granted unsupervised time as the mother argued her caregiving capacity would be affected if it was permitted. The Full Court of the Family Court (as it was then known) agreed that it was within the trial judge’s power to determine that the negative impact on the mother of child spending unsupervised time with the father would be detrimental to the child’s welfare, and that consideration ultimately outweighed the benefit of the father spending unsupervised time with the child.
Why the Courts are slow to adopt Re Andrew today
It is clear that whether a parent’s time with a child is to be the subject of supervision, or not, turns on the facts of each individual case. However, the principles set out in Re Andrew were the subject of discussion in the decision of Keane & Keane [2021] FamCAFC 1, in which the Court sought to clarify the way those principles ought to be taken into consideration.
The appellant mother in Keane sought to rely on Re Andrew in appealing the trial judge’s decision to transition the child’s time from supervised to unsupervised time. The original order for supervised time was made on the basis of allegations that the father had perpetrated family violence on the mother prior to and after separation, in addition to allegations of sexual abuse by the father on the child, the latter of which was held by the trial judge to be “so unlikely that it cannot establish any real chance of sexual abuse.”
At trial, the mother did not produce any evidence to show the extent to which her parenting capacity would be impaired should an order for unsupervised time be made, other than her being genuinely distressed by the proposition. She conceded that counselling and therapy were open to her should she need to seek help in that regard. The trial judge therefore exercised their discretion, weighed the risk factors, and found it was in the best interest of the child that they should spend unsupervised time with their father. This discretion was upheld at appeal.
Keane was determined with the benefit of twenty-six years of jurisprudence since the introduction of “the best interests of the child” principle under section 60CA of the Act in 1995. It is this paramountcy principle that balances against “unacceptable risk” to the child when considering parenting orders.
Put simply, it is the all too frequent reality for many parents that there exists some level of risk in another parent spending time with a child. However, this risk could be mitigated, for example, by time being spent in public settings as opposed to private settings, or for shorter periods of time. For the child to have the benefit of a meaningful relationship with both parents as envisioned under section 60CC(2) of the Act, which is a primary consideration for any judge making a decision, the Court understands that meaningful relationship is difficult to maintain in a constantly supervised arrangement, and will usually adopt this as a short-term solution, with the intention of moving to unsupervised time if and when the Court can be satisfied that any risk is properly addressed.
Consequently, the Court is cautious in restricting the time a parent spends with a child on the basis of another parent’s alleged impaired capacity, unless presented with evidence of sufficient weight that goes beyond a general statement of fear.
*This article was prepared with the assistance of Alex Feng
Introduction
In a recent case, the early restructuring was proven as a useful tool for practitioners in circumstances where there is value in moving quickly to affect the restructure prior to the first meeting of creditors.
Case Analysis: Re Richstone Plumbing Pty Ltd (Administrators Appointed) [2023] VSC 112
Facts
Richstone Group was a large plumbing contractor, who, due to matters including the economic conditions of the construction industry, earlier this year sought to implement a restructure to continue trading.
Administrators were appointed in March 2023 to the seven companies in the Richstone Group. As at the date of their appointment, the Richstone Group had 150 employees and owed significant debt to the ATO, secured creditors, and multiple leases / purchases on finance of motor vehicles, plant, machinery and equipment.
Shortly after their appointment, an offer was put to the administrators for their consideration which proposed a sale before the first meeting of creditors. The offer involved a purchase of all of the Richstone Group’s trade debtors, work in progress, material contracts, plant and equipment, motor vehicles, stock, intellectual property, goodwill and business records. The purchase price included assumption of liabilities and an additional cash payment.
On 10 March 2023, the administrators executed a series of asset sale agreements, each of which had a precondition that the Court grant the judicial directions sought by the administrators. The Supreme Court granted the directions sought the same day.
Decision
The administrators sought directions pursuant to s 90-15 of the Insolvency Practice Schedule (Corporations) that they were justified and otherwise acting reasonably in disposing of the Group’s assets in accordance with the sale transaction.
The Court noted that the only alternative available to the administrators, in circumstances where they are without sufficient funds to continue to trade the business, is to immediately cease trading and terminate the employment of Richstone Group’s 150 employees. They stated that the potential loss of employment was an important consideration in support of providing the direction sought.
The Court granted the directions sought and held that the sale was consistent with the interests of creditors as a whole and the objectives of s 435A of the Corporations Act 2001 (Cth) (Corporations Act).
The administrators also sought orders limited their personal liability under Pt 5.3A of the Corporations Act. The Court agreed that these orders were appropriate, stating that while the asset sale agreement was “clearly in the best interests of the creditors,” the Court confirmed that the administrators shouldn’t be exposed to liability for debts outside their control.
Conclusion
This case has a number of key takeaways:
*This article was prepared with the assistance of Annabel Randall
Introduction
In a recent case, the New South Wales Court of Appeal (NSWCA) explored the circumstances in which research and development tax refunds can constitute circulating assets subject to employee priority under the Corporations Act 2001 (Cth) (Corporations Act).
Case Analysis: Resilient Investment Group Pty Ltd v Barnet and Hodgkinson as liquidators of Spitfire Corporation Limited (in liq) [2023] NSWCA 118.
Facts
This case involved priority dispute between a secured creditor – Resilient Investment Group Pty Ltd (Resilient) and the Commonwealth of Australia (Commonwealth) as a subrogated employee creditor regarding a tax refund received by Spitfire Corporation Limited (in liq) (Spitfire) after the commencement of its winding up.
The first decision (Resilient Investment Group Pty Ltd v Barnet and Hodgkinson as liquidators of Spitfire Corporation Limited (in liq) [2022] NSWSC 340) was held in favour of Commonwealth and was then appealed by Resilient.
Spitfire was a parent entity of Spitfire Group which inter alia engaged in various research and development (R&D) activities alongside its core business, entitling it to receive tax offset refunds for its R&D expenditure.
In August 2020, following their appointment to Spitfire and a related entity of Spitfire called Aspirio Pty Ltd (in liquidation) (Aspirio), the liquidators received R&D Refunds of approximately $2 million for the 19-20 income years.
As a result, the Commonwealth became a subrogated creditor after paying employee entitlements under the Fair Entitlements Guarantee scheme. Resilient and Commonwealth then claimed their priority over the R&D Refunds.
Legislation
This case involved the analysis of multiple pieces of legislation. These include:
Further Considerations
The NSW Court of Appeal was required to determine whether a tax refund can constitute a circulating asset within the context of the Corporations Act and the PPSA
To be considered a circulating asset, the R&D Refunds need to fall under s340(1)(a) and s340(5) of the PPSA, particular to:
According to s10 of the PPSA an account can only exist if there is a monetary obligation at the liquidators’ appointment date.
Decision
The Court determined that the obligation to pay a tax offset arises only once the Commissioner issues a relevant income tax assessment for a given income year – which hadn’t occurred at the time the liquidators were appointed.
At the time of the liquidators’ appointment, the R&D Refunds couldn’t be characterised as a monetary obligation, and accordingly were not circulating assets within the meaning of the PPSA and the Corporations Act.
The Court ultimately held that Resilient had priority to the R&D Refunds over the Commonwealth’s claim under s561 of the Corporations Act.
Conclusion
This case has a number of key takeaways:
*This article was prepared with the assistance of Annabel Randall
What is a Bankruptcy Notice?
Pursuant to section 41 of the Bankruptcy Act 1966 (Cth) (the Act), a bankruptcy notice is a formal notice of demand that requires a debtor to pay a judgement debt to a creditor. While invalidating a bankruptcy notice may not stop creditors from pursuing a judgement debt, it may provide time for the debtor to acquire more funds or seek alternative pay arrangements. The case of Grant v Green & Associates Pty Ltd [2021] FCA 934 (Grant v Green & Associates) provides an example of a successful invalidation of a bankruptcy notice.
Case Analysis: Grant v Green & Associates Pty Ltd
Facts
Green & Associates (G&A) served a bankruptcy notice (the Notice) on Ms Nerez Grant (Grant) on 13 May 2021 for $27,802.87. The Notice required her to pay or make alternative arrangements to pay within 21 days, however the Notice contained 3 significant errors:
Infringed Legislation
Section 41(5) of the Act provides that a bankruptcy notice is not invalidated merely because the debt specified is overstated unless the debtor gives notice to the creditor that they dispute the validity of the bankruptcy notice due to the overstatement within the time fixed for compliance with the bankruptcy notice.
Arguments
G&A submitted that Grant did not comply with the legislation because she failed to serve the affidavit within the initial 21 days as specified in the Bankruptcy Notice. However, Grant argued that she served G&A within the extended timeframe granted by the courts. She also suggested that G&A knew that the debt listed on the bankruptcy notice was incorrect.
Decision
Wigney J held that due to the overstatement of the debt, the notice should be set aside. On the second issue of serving the documents, the time frame would encompass any extensions that had been granted by the court. Lastly, regarding the address error issue, Wigney J stated that it was unlikely to cause substantial injustice and Grant would have been able to easily rectify this error.
Takeaways
Overall, this case acts as a reminder to take into account garnishee orders or any other partial payment of a debt when issuing a bankruptcy notice. Additionally, it conveys the importance of checking for basic administrative errors such as correct addresses, however this alone would not cause the invalidation of a bankruptcy notice.
*This article was prepared with the assistance of Annabel Randall
What is ASIC?
The Australian Securities and Investments Commission (ASIC) is an independent Australian Government body that was established under the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act) and operate under the Corporations Act 2001 (Cth) (the Corps Act). Its role is to regulate the conduct of Australian companies, financial markets, financial services organisations and professionals involved in the consumer credit field. This article will concern its role of improving the performance of the financial system and regulating the law efficiently with minimal procedural requirements.
Changes to the Regulatory Scheme
Under the ASIC Corporations and Credit (Amendment) Instrument 2023/589, (the Instrument) ASIC have modified the licensees’ obligations under the reportable situations regime, effective from 20 October 2023. These amendments have significantly impacted the obligations of licensees with specific changes in reporting requirements and the time period for reporting.
Amendment 1: Changes in Reporting Requirements
Prior to the amendment, Australian financial services and Australian credit licensees were required to automatically submit notifications to ASIC about ‘significant’ breaches of ‘core obligations.’ The Instrument modifies this requirement to exclude specific breaches of misleading or deceptive conduct provisions contained in section 1041H(1) of the Corps Act or section 12DA(1) of the ASIC Act.
Additionally, section 12DB(1) of the ASIC Act has provisions concerning false or misleading misrepresentations, which were deemed significant breaches of the core obligations. Similarly, these were automatically reportable.
Moving forward, a report will not need to be lodged with ASIC as long as the circumstances:
Amending 2: Extended Period for Reporting
Previously, licensees had 30 days from first knowing that, or are reckless with respect to whether, there are reasonable grounds to believe that a reportable situation has occurred, to lodge a report with ASIC. However, from 20 October 2023, this period has extended to 90 days, giving licensees more time to lodge their report with ASIC.
How can Chamberlains help?
At Chamberlains Law Firm we can help you to understand the ASIC regulations and assist you to ensure your compliance with the regulations.
*This article was prepared with the assistance of Annabel Randall
Don’t worry, you don’t really have to ask your partner that question if you don’t want to. However, many people don’t realise that their property and financial interests could change significantly if a relationship they are in breaks down, even if they aren’t married!
When do you become involved a de facto relationship?
When it comes to property and financial claims under the Family Law Act 1975 (Cth) (“the Act”) a relationship may be considered de-facto if:
Meaning of genuine domestic basis
The “circumstances” that the Act refers to may be considered, individually or collectively, when determining whether a de-facto relationship exists and how long it may have endured. These circumstances include:
Interestingly, the way the Act defines de facto relationships means that a person of a marriage can actually be in a de facto relationship with a separate third-party. For example, this may arise where;
When do you make your property claim?
Parties have two years after the break-down of a de facto relationship to make a claim for property and financial settlement, commonly referred to as a “limitation period”. There may be exceptions, but applications made outside of the limitation require leave (in other words, “permission”) from the court to proceed.
Your next steps
Are you concerned about the future of your relationship and what might happen if you separate? Have you recently separated from your partner and are unsure whether you have a claim to a property/financial settlement? Speak to our Family Law team today and let us help you navigate these issues for your financial security and peace of mind.
*This article was prepared with the assistance of Alex Feng.
In AIG Insurance Australia Ltd v McMurray [2023] WASCA 148, the Court of Appeal of the Supreme Court of Western Australia considered whether long standing principles of contractual construction had been correctly applied to give meaning to the word ‘structure’ in an insurance policy. The seemingly innocuous term was worth millions.
Background
In August 2014, Frederick and Jennifer McMurray bought 179 Wellington Street, Mosman Park in Western Australia (Property) for $8.95M.
Before moving in, the McMurrays carried out renovations on the Property.
The McMurrays told their insurance broker that they wanted Property fully insured during renovations.
Subsequently, an AIG home insurance policy was obtained for the Property (Policy).
Between mid-2015 and early 2016, the McMurrays spent more than $1M renovating the Property.
On 16 January 2016, a fire broke out at the Property. The fire was said to have been started by the ignition of oil rags that had been left in the Property.
The Property had to be demolished.
The McMurrays lodged a claim with AIG under the Policy.
The Policy
AIG denied the McMurrays’ claim.
AIG considered that (among other things) the following provisions of an exclusion clause (Exclusion Clause) in the Policy defeated the McMurrays’ claim for indemnity:
Contract Works Exclusion
Notwithstanding any terms or conditions to the contrary no cover shall be provided under the Your Policy for:
– in connection with the Contract Work, Temporary Work, Free Issue Materials or Works…
For the purposes of this exclusion the following definitions apply:
Damage means any loss, fine, penalty, cost, charge, liability, physical loss or Property Damage including any Earth Movement
Contract Work means any and all structures constructed or in the course of construction wheresoever located or whilst in transit and which are incorporated or are to be incorporated into a permanent structure at the Location
All other terms utilised in this exclusion shall be defined in accordance with the applicable definition of such terms as found in Your Policy.
The McMurrays sued AIG in the Supreme Court of Western Australia.
At first instance
The McMurrays’ claim was heard by Smith J.
AIG argued that the Exclusion Clause applied because the:
The McMurrays argued that the Exclusion Clause did not apply because the timber panels and doors were not ‘structures’.
Smith J looked to the Policy for guidance as to what ‘structure’ meant in the context of the Exclusion Clause. In doing so, Her Honour found that ‘structure’ meant more than mere components of a structure.
Ultimately, Her Honour found that ‘structure’ meant:
“…a building or a substantial built form that has a particular purpose, which can contain either built form of contents or is designed to contain contents once constructed, such as furniture in a granny flat, and not merely items installed or constructed in the course of, alteration, renovation or refurbishment work to the house” (emphasis added)
Alternatively, Her Honour concluded that if the Exclusion Clause remained ambiguous, the contra proferentum rule applied meaning that the argument about the meaning of ‘structure’ should be resolved in favour of the McMurrays.
AIG appealed the decision.
On appeal
AIG’s extensive grounds of appeal contended, among other things, that the primary judge’s interpretation of ‘structures’ was too narrow and that the contra proferentum rule had been inappropriately applied.
AIG contended that the term ‘structure’ meant ‘building materials’ because building materials create structures. AIG further argued that its interpretation of ‘structure’ was so obviously correct that there was no confusion that warranted the application of the contra proferentum rule.
Legal principles
Interpreting an ambiguous word in contracts requires that the word be given its ordinary and natural meaning.
The Court of Appeal noted that dictionary definitions of ‘structure’ included:
On that basis, the Court of Appeal concluded that:
“The primary judge’s construction is… entirely consistent with the ordinary and natural usage of the word ‘structure’ and the sense of the word on an ordinary and natural reading of the…[Exclusion Clause]”
The Court of Appeal also dismissed AIG complaint about the primary judge’s application of the contra proferentum rule.
The Court of Appeal acknowledged that ‘structure’ was open to ambiguity and said that the primary judge had, correctly, “only relied on the contra proferentem principle as a secondary and alternative approach” to interpreting the word based on its ordinary and natural meaning.
Takeaways
Sometimes, the operation of a significant clause in an insurance policy can turn on a seemingly innocuous word.
If your insurance claim has been declined, consider obtaining legal advice about your insurer’s interpretation of the policy. It would be worth millions!
Feel free to contact the Insurance and Dispute Resolution team at Chamberlains Law Firm.
The Briginshaw principle is derived from comments made by Dixon J in Briginshaw v Briginshaw (1938) 60 CLR 336.
In civil proceedings, to be successful a plaintiff must lead evidence that establishes their claim on the ‘balance of probabilities’.
The Bringinshaw does not introduce a separate standard of proof into civil proceedings. The principle applies to require that more convincing evidence is required to establish an allegation on the balance of probabilities if the allegation is of a particularly serious nature. The principle cautions against adopting a purely mathematical analysis of the balance of probabilities and suggests that the decision maker should feel actual persuasion that the evidence establishes the allegation.
Mr Briginshaw applied for a divorce from his wife and relied on allegations of adultery in support of his application. Mr Briginshaw alleged that his wife had attended dances with another man, who also drove her home and kissed her.
At first instance, Martin J of the Supreme Court of Victoria applied the criminal standard of proof to the matter. That is, His Honour considered that Mr Bringinshaw had to prove his allegations of adultery beyond a reasonable doubt. Mr Briginshaw appealed the decision on the basis that Martin J applied the wrong standard of proof (‘beyond reasonable doubt’ instead of ‘on the balance of probabilities) in deciding whether adultery had been proved.
The High Court dismissed Mr Briginshaw’s appeal. The Court found that the primary judge had applied the wrong standard of proof to the allegations. However, in dismissing the appeal the High Court found that the primary judge would not have found in Mr Briginshaw’s favour even if the lower standard of proof (on the balance of probabilities) had been applied to the allegations of adultery.
In his judgment, His Honour, Dixon J, commented that:
“…The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer… In such matters ‘reasonable satisfaction’ should not be produced by inexact proofs, indefinite testimony, or indirect inferences.”
The Hight Court provided further comment on the principle in Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 110 ALR 449, at 2:
“The ordinary standard of proof required of a party who bears the onus in civil litigation in this country is proof on the balance of probabilities. That remains so even where the matter to be proved involves criminal conduct or fraud. On the other hand, the strength of the evidence necessary to establish a fact or facts on the balance of probabilities may vary according to the nature of what it is sought to prove. Thus, authoritative statements have often been made to the effect that clear or cogent or strict proof is necessary “where so serious a matter as fraud is to be found”. Statements to that effect should not, however, be understood as directed to the standard of proof. Rather, they should be understood as merely reflecting a conventional perception that members of our society do not ordinarily engage in fraudulent or criminal conduct and a judicial approach that a court should not lightly make a finding that, on the balance of probabilities, a party to a civil litigation has been guilty of such conduct.”
The Briginshaw Principle has since been enshrined in statute. Section 140(2) of the Evidence Act 1995 (NSW) provides that when deciding if a case has been established on the balance of probabilities the Court may take into account –
The Bringinshaw principle can impact various civil proceedings. For example, proceedings concerning allegations of:
If you have a civil claim that requires establishing a serious allegation, obtain legal advice about your evidentiary obligations.
Feel free to contact the Insurance and Dispute Resolution team at Chamberlains Law Firm.
This article was prepared with the assistance of Elinore Rema.
This morning, the High Court handed down the decision in the GLJ v Diocese of Lismore [2023] HCA 32 appeal.
In a win for GLJ and many other survivors of historical abuse, the High Court has overturned the permanent stay ordered by the NSW Court of Appeal and allowed the claim against the Catholic Church to proceed. In doing so, the High Court has signaled that survivors of historical abuse may not be faced with the threat permanent stays, a tactic which has increasingly been used by defendants.
Background
GLJ (a pseudonym) was allegedly abused by Father Anderson of the Catholic Church, Diocese of Lismore in 1968, when she was 14 years old. Father Anderson was directed by the Diocese to attend GLJ’s family home to provide pastoral and spiritual support after her father was seriously injured in a motorcycle accident. During his visit to the family home, Father Anderson allegedly sexually abused her. No legal action was taken until 2020, when a Statement of Claim was filed in the NSW Supreme Court for the appellant.
The matter was heard in the NSW Supreme Court where the judge refused to grant a permanent stay application. The Diocese (defendant) then appealed the matter to the Court of Appeal, where the application for a stay was successful. GLJ then applied for and was granted special leave to appeal to the High Court.
High Court Decision
The High Court examined two main issues that arose in the appeal.
Firstly, the applicable standard for appellate review of an order of a court permanently staying proceedings on the ground that a trial will be necessarily unfair or so unfair or oppressive to the defendant as to constitute an abuse of process.
Kiefel CJ, Gageler and Jagot JJ confirmed that the applicable standard of review is the “correctness standard” identified in Warren v Coombes (1979) 142 CLR 531. Finding an error in the exercise of discretion is not necessary as per the decision in House v The King (1936) 55 CLR 499, which was relied upon by the judges during the NSW Court of Appeal proceedings.
The second issue is whether the appellant’s proceedings against the respondent, the Trustees of the Roman Catholic Church for the Diocese of Lismore (“the Diocese”), involve an abuse of process justifying a permanent stay of proceedings. The Diocese applied for a stay on the grounds that a trial would be necessarily unfair given the historical nature of the allegation and the fact that the alleged abuser was deceased.
Kiefel CJ, Gageler J and Jagot J made the following comment regarding the stay of proceedings:
“As explained, the fact has some 55 years have passed since the alleged sexual assault, in and of itself, is immaterial. The details of the alleged sexual assault are not vague and uncertain…The Diocese was aware of and had acted on the fact that Father Anderson (alleged abuser) has sexually abused boys while a priest well before the sexual assault of GLJ occurred…”
Additionally, with the enactment of the Limitation Amendment (Child Abuse) Act 2016 (NSW), limitations periods no longer affect when proceedings can be commenced. Kiefel CJ, Gageler and Jagot JJ commented that:
“In this new legal context, the Diocese’s contention that any trial of the proceedings would be necessarily unfair must be rejected. As the Diocese acknowledges that its case for a permanent stay for abuse of process was based only on necessary unfairness of a trial and not undue oppression or unfairness otherwise, no permanent stay is justified.”
“The proceedings must go to trial.”
Conclusion and Orders
Kiefel CJ, Gageler and Jagot JJ surmised that the NSW Court of Appeal were wrong to conclude that there could be no fair trial of the proceedings and they should not have been the subject of an order for a permanent stay. They should proceed to trial.
The following orders were made:
Effect on Historical Abuse Claims
The High Court’s decisions become binding for all lower courts in Australia. Had the appeal been dismissed, it would make it difficult for future historical abuse claims to succeed, where permanent stay applications were possible.
It is hoped that the outcome of the GLJ appeal will also force Defendant’s to exercise restraint in the application for permanent stays in the future.
The Supreme Court of Victoria has recently considered a security for costs application in the context of a permanent stay appeal in the case of Weiden, Alan v YZ (a pseudonym) & Beit Habonim P/L (ACN 051 827 984) as trustee of The Association Of Parents & Friends Of Zionist Youth [2023] VSCA 258.
The plaintiff, YZ, commenced proceedings for damages arising from personal injuries suffered as a result of sexual abuse that allegedly occurred when he was a member of Beit Habonim in 1974 and 1975. The abuse was allegedly perpetrated by Alan Weiden, who is the second defendant in the proceedings. Mr Weiden presently resides in Israel.
Mr Weiden applied for a permanent stay on 17 May 2022. The application was dismissed by Irving AsJ on 15 July 2022. The decision of Irving AsJ was appealed by Mr Weiden, and he was subsequently ordered to pay $15,000 security for the plaintiff’s costs in respect of the appeal of Irving AsJ’s orders.
The appeal was heard by Tsalamandris J on 21 February 2023, and was later dismissed.
Mr Weiden has appealed the orders made by Tsalamandris J.
On 6 June 2023, the plaintiff’s solicitors sent correspondence to Mr Weiden’s lawyers seeking security for his costs in the sum of $37,100 in relation to the proposed appeal to the Court of Appeal. The bases of the request for security of costs included that Mr Weiden is a resident in Israel with no assets in Victoria; the existence of untaxed costs orders made against Mr Weiden, which the plaintiff suggested Mr Weiden is averse to paying; and Mr Weiden’s lack of prospects of success of his proposed appeal. The correspondence stated that if Mr Weiden failed to agree to provide security then the plaintiff reserved his rights to apply to the Court without further notice.
In a letter dated 13 June 2023, Mr Weiden’s solicitors disputed the requirement to pay security for the plaintiff’s costs of the appeal. The letter argued that any security a Court would order would be limited to the costs incurred for seeking to enforce an order made against Mr Weiden in Israel. Mr Weiden’s solicitors indicated that their client’s proposal for dealing with the plaintiff’s request for security of costs would be provided once they had determined the costs required to enforce a foreign judgment in Israel.
The plaintiff’s solicitor responded on 14 June 2023, disputing certain propositions put by Mr Weiden’s lawyers letter dated 13 June 2023, and expressing concerns about Mr Weiden’s ability to satisfy any additional costs order that may be made against him. The plaintiff’s solicitor indicated that an application would be filed with the Court by 16 June 2023 if Mr Weiden’s agreement to pay security costs was not received.
On 9 August 2023, the parties were advised that Mr Weiden’s appeal had been accepted and would be heard on 24 November 2023.
On 8 September 2023, Mr Weiden filed his Amended Written Case and an Amended Agreed Summary.
On 21 September 2021, the plaintiff’s solicitors requested a copy of the Israeli law pertaining to enforcing a foreign judgment. Mr Weiden’s solicitor provided same on 3 October 2023.
On 5 October 2023, the plaintiff filed the application for security of his costs with the Court, 4 months after it was initially proposed. The application sought orders that Mr Weiden not only provide security for the plaintiff’s costs, but also that the application for leave to appeal be stayed until the security is provided, and the application for leave to appeal be dismissed with costs if the security is not provided.
The plaintiff’s solicitors filed an affidavit exhibiting correspondence which was exchanged by the parties regarding security for costs.
In hearing the application for security costs, the Court referred to Rule 64.38(2) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic), which gives the Court a discretionary power to make an order for security of costs of an appeal or application before the Court. Beach JA and Macaulay JA confirmed the matters to be considered when deciding whether to exercise the power include: “the prospects of success of the appeal; the degree of risk that a costs order might not be satisfied; whether the making of an order would be oppressive by stifling a reasonably arguable claim; whether any impecuniosity of the applicant for leave to appeal arises out of the conduct about which complaint is made; whether there are any aspects of public interest militating against the making of an order; and whether there are any particular discretionary matters relevant to the application” [at 12].
Their Honours went on to confirm that whether a hearing was imminent was also a relevant consideration when deciding whether to exercise the discretion. Their Honours heard the application for security costs on 26 October 2023 and handed down their decision on the same date. Their Honours stated at [14] that the four-month delay in filing the application was “simply unacceptable” as the solicitors for Mr Weiden had in that time prepared and filed documents in relation to the application for leave to appeal.
Their Honours did not feel it necessary to thoroughly discuss the prospects of Mr Weiden’s application for leave to appeal and appeal but stated that they were not satisfied that his prospects were so low as to warrant making the orders the plaintiff sought.
The plaintiff’s application for security costs was thus dismissed.
The decision is a reminder for practitioners to apply for security of costs well in advance of the relevant application being heard before the Court.