//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2025] NSWCA 252
respondent. The judicial review proceedings were dismissed as an abuse of process; YBL2 was ordered to pay the applicant’s costs of the motion, with Amirbeaggi jointly and severally liable, and the applicant...
The Court ended YBL2’s judicial review case because it considered the dispute had become vastly more expensive and extensive than the original $98,000 debt justified, particularly given the effect of the DOCA. It did not dismiss the case for delay alone. It ordered YBL2 to pay the costs of Poche’s motion and also made Amirbeaggi personally liable for those costs, based on his involvement, funding, and connection to the company and related creditor entities. The Court did not award the costs of the judicial review proceedings as a whole.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
2,356 words · generated 06/10/2026
The judgment concerns a long-running dispute between a legal services company, A.C.N. 627 087 030 Pty Limited, which Ward P calls “YBL2”, and its former client, Adam Poche. The initial dispute arose from a costs assessment of work YBL2 had done for Poche. The assessment reduced the amount payable to YBL2 by $98,000. As Poche had already paid that amount, the judgment describes a statutory debt of $98,000 in his favour from about 7 May 2021: [2].
6 cited instruments linked from this judgment.
YBL2 challenged the costs assessment and was unsuccessful. It then appealed to the District Court and was again unsuccessful. It later sought judicial review in the Court of Appeal of the District Court decision, and that application was dismissed: [3]. A further costs dispute followed. The District Court made a gross-sum costs order against YBL2 of $216,372.20: [4].
YBL2 commenced the judicial review proceedings at issue in this judgment, challenging the District Court’s decision on the gross-sum costs. Its stated grounds included apprehended bias and alleged errors concerning the Legal Profession Uniform Law Application Act 2014 (NSW) and proportionality under s 98(4) of the Civil Procedure Act 2005 (NSW): [5]–[7]. The judgment does not decide those substantive grounds.
In April 2025, Kirk JA refused YBL2’s application to stay the District Court costs orders and ordered YBL2 to provide $30,000 security for Poche’s costs. The proceedings were stayed pending provision of that security. YBL2 did not provide it by the specified deadline: [9]–[12]. YBL2 entered voluntary administration on 28 April 2025. A deed of company arrangement (DOCA) was executed on 23 June 2025: [12], [15], [17].
The DOCA included the judicial review proceedings among the litigation whose proceeds could form part of the deed fund. It also provided for creditors to accept any dividend in full and final settlement of their claims against the company: [22]. The parties disagreed about what those terms meant for Poche’s debt and for the continuation of the judicial review. Poche argued that the debt had been compromised and that the proceedings had no practical utility. YBL2 argued that the proceedings could reduce the amount of Poche’s claim, benefiting the company under the DOCA: [30]–[40].
Poche applied to dismiss the judicial review proceedings as an abuse of process, or alternatively for want of prosecution. Ward P dismissed the proceedings as an abuse of process. The Court ordered YBL2 to pay the costs of the motion and ordered Farshad Amirbeaggi, YBL2’s sole shareholder and former sole director, to be jointly and severally liable for those costs: [53], [62]–[64].
Ward P’s central concern was proportionality. The original dispute was about a $98,000 debt, but YBL2 had incurred about $180,000 in seeking to challenge that debt, according to the material before the Court: [43]. The judge also considered what further litigation would follow if YBL2 succeeded. The proceedings could lead to the matter being returned to the District Court for another hearing about costs. If a gross-sum order were not made, there could then be a costs assessment, objections and appeals: [43].
The Court did not say that the judicial review had literally no possible utility. Ward P acknowledged that it could potentially result in a different gross-sum costs determination: [44]. The point was that possible utility did not, in the Court’s assessment, make continued litigation acceptable in the circumstances. The judge described the dispute as “satellite litigation in the extreme” and considered it disproportionate to continue it when Poche was bound to accept a pari passu distribution from the deed fund: [43].
The DOCA was important to that assessment. The judgment sets out provisions stating that creditors were bound by the deed, that the company’s deed fund would include specified litigation proceeds, and that creditors would accept a dividend in full and final settlement of their claims: [21]–[25]. Ward P’s conclusion was that Poche’s debt had been compromised under the DOCA. The judgment records the competing interpretations advanced by the parties, but does not provide a general ruling on how all DOCAs should be construed. Nor does it set out a separate, exhaustive construction analysis of every relevant DOCA clause. Its holding is directed to whether these proceedings should continue on the material and submissions before the Court.
The Court treated the abuse-of-process question separately from the alternative want-of-prosecution argument. The record included missed deadlines for amended pleadings, documents required by UCPR r 51.45, submissions, and the $30,000 security for costs: [46]–[49]. However, Ward P expressly said it was unnecessary to decide that alternative ground. The judge added that, if the motion had relied only on failure to prosecute with due despatch, it would not have been granted: [52]. The dismissal therefore rested on abuse of process, not merely procedural delay.
The costs outcome also had two distinct parts. Applying the principles in Ex parte Lai Qin, Ward P made no order for the costs of the judicial review proceedings as a whole because they had been dismissed without a hearing on the merits: [55]–[56]. But the Court ordered costs of the motion to follow the event. This distinction matters: the order did not award Poche all costs of the underlying judicial review proceedings.
For the non-party costs order, Ward P identified the interests of justice as the overriding consideration: [59]. The judge noted that Amirbeaggi’s status as a shareholder, and any benefit that might flow to him from a benefit to YBL2, would not alone justify an order: [60]. Other matters were material. Amirbeaggi had been extensively involved, had effectively funded the proceedings, and had proposed the DOCA under which Poche’s debt was compromised: [59], [61]. The Court also considered it unlikely that YBL2 could pay Poche’s motion costs and found that the related legal practices associated with Amirbeaggi stood to benefit as creditors of the company: [62]–[63].
This judgment applies existing procedural and costs principles to a particular combination of circumstances. It does not announce a new statutory test for abuse of process or replace the principles it cites. The Court relied on UCPR r 13.4 and its inherent jurisdiction as the bases for dismissal: [1], [53]. It considered proportionality, utility and the character of the proceedings as satellite litigation when deciding whether continuation was abusive: [32]–[44].
The judgment’s discussion of DOCAs draws on authorities quoted in the parties’ submissions, particularly Academy Construction & Development Pty Ltd (subject to Deed of Company Arrangement) [2024] NSWSC 808: [30]. That discussion concerned the statutory force and construction of DOCAs. Ward P records the parties’ competing interpretations of this DOCA but does not purport to settle a general rule about the construction of every deed of company arrangement. The practical result was a finding, for this dispute, that Poche’s debt had been compromised and that the proceedings were abusive in the surrounding circumstances: [43]–[44].
On want of prosecution, the judgment recites the factors assembled in Hoser v Hartcher, including prejudice, the reasons for delay, the parties’ conduct and the prospects of success: [50]. Ward P did not apply that list to make an independent dismissal order. Instead, the judge stated that the alternative application would not have succeeded if it stood alone: [52]. Thus, the decision should not be read as establishing that missed procedural deadlines of the kind described automatically justify dismissal.
On non-party costs, Ward P restated that the interests of justice are the overriding consideration, while cautioning that a potential benefit from the litigation alone is insufficient: [59]–[60]. The order against Amirbeaggi rested on the combined facts identified by the Court, including involvement, funding, the DOCA, related creditor interests, and YBL2’s apparent inability to meet the costs: [61]–[63]. The judgment does not say that a shareholder, solicitor, funder or deed proponent will necessarily be liable in another case merely because of that role.
At [43], Ward P said: “The disproportionality of the dispute defies belief.” In plain English, the Court considered the resources being spent on the continuing litigation excessive relative to the original $98,000 debt. The judge linked that assessment to both past expenditure and the likely sequence of further hearings if YBL2 succeeded.
At [43], the Court described the proceedings as “satellite litigation in the extreme”. This refers to litigation arising around the original dispute rather than bringing it to an efficient end. The Court’s concern was that even a successful judicial review might not resolve the costs dispute. It could instead produce another District Court hearing and further costs-assessment processes.
At [44], Ward P acknowledged that the judicial review might have utility because it could lead to a different determination of the gross-sum costs order. The judge nevertheless concluded that continuation was an abuse of process. The passage shows that possible practical effect was considered but was not, by itself, enough to justify continuing the litigation.
At [52], Ward P said the Court would not have dismissed the proceedings if the application had been based solely on failure to prosecute with due despatch. In plain English, the procedural history was not the legal basis for the result. The successful ground was abuse of process.
At [60], the Court observed that the fact a person might benefit from litigation does not, without more, justify a non-party costs order. The qualification “without more” is important. The Court then considered other features of Amirbeaggi’s involvement and funding: [61]–[63].
At [63], the Court distinguished Amirbeaggi from someone who merely acts as a solicitor for a party. It considered his association with related incorporated legal practices that were creditors of YBL2, alongside his other involvement, relevant to whether he went beyond that ordinary role. The finding was fact-specific and tied to the interests of justice in this case.
The judgment is most relevant to cases where a proceeding continues after a material change in the parties’ circumstances, particularly where a company’s debt has been addressed through a DOCA and the litigation is said to have no proportionate or practical role in the arrangement. The features that mattered here included the original value of the dispute, the substantial costs already incurred, the prospect of further proceedings, and the deed’s treatment of the creditor’s claim: [22], [24]–[25], [43]–[44].
It may also be relevant where litigation is described as satellite litigation and a court is asked to assess whether its remaining utility justifies the private and public resources needed to continue it. Ward P did not hold that a proceeding becomes abusive simply because it is expensive, or because it has a connection to a company in administration. The conclusion followed from the combination of circumstances before the Court.
For a non-party costs application, the relevant pattern is not just that a person owns or benefits from a company involved in litigation. The judgment expressly warns that benefit alone is not enough: [60]. The Court’s assessment also took account of the person’s role in funding and advancing the litigation, the DOCA proposal, related creditor interests, and the likelihood that the company could not pay the motion costs: [61]–[63].
The judgment is less directly useful as authority for a dismissal based solely on delay. Although it records repeated failures to meet procedural requirements, the Court expressly said it would not have dismissed the proceedings on that ground alone: [46]–[52]. Any reliance on the decision for want-of-prosecution principles should therefore preserve that distinction.
The judgment is dated 24 November 2025 and the supplied text does not identify any later court decisions considering or applying it. No account of its subsequent treatment can therefore be given from this source.
Within this judgment, Ward P refers to an earlier decision in the same litigation, ACN 627 087 030 Pty Limited v Poche [2025] NSWCA 66, for the amount of the District Court gross-sum costs order and procedural history: [4], [9]–[11]. That earlier decision is background, not later treatment of the present ruling.
The judgment itself discusses or refers to other authorities when considering DOCAs, delay, costs and non-party costs. For example, it discusses Academy Construction at [30], recounts the Hoser v Hartcher factors at [50], applies the costs approach from Ex parte Lai Qin at [55]–[56], and refers to Brand2Content in stating the interests-of-justice approach to third-party costs at [59]. Those authorities are the precedents Ward P considered; they are not later decisions about this judgment.
The judgment does not determine the substantive grounds in YBL2’s judicial review summons. Those grounds concerned alleged apprehended bias and alleged legal error in the District Court’s treatment of costs: [5]–[7]. Because the proceedings were dismissed as an abuse of process, the Court did not decide whether either ground was established.
The judgment also does not comprehensively resolve the construction of every DOCA clause raised by the parties. It records the argument that the debt was compromised, the competing argument that the proceedings were preserved to reduce the debt, and the parties’ reliance on clauses dealing with distributions and adjudication: [30]–[40]. Its dispositive conclusion was that continuation of this litigation was an abuse of process in the circumstances. It does not set out a general test for when a creditor’s claim is compromised by a DOCA that also refers to litigation concerning that claim.
The alternative want-of-prosecution ground remains undecided as a separate basis for dismissal. Ward P indicated that it would not have succeeded on its own on this record: [52]. The judgment therefore leaves open how the particular delays and explanations might have been assessed if abuse of process had not been established.
Finally, the decision does not state how later courts have treated its reasoning, and the supplied judgment contains no subsequent appellate history. Its approach to abuse of process and non-party costs should be understood by reference to the facts and conclusions Ward P actually identified, rather than as an automatic result for other proceedings involving a DOCA, a shareholder, or litigation funding.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have a qualified Australian lawyer check it.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: A.C.N. 627 087 030 Pty Ltd v Poche [2025] NSWCA 252
Hearing dates: 10 November 2025
Date of orders: 10 November 2025
Decision date: 24 November 2025
Before: Ward P
Decision: 1. Dismiss the proceedings as an abuse of process pursuant to rule 13.4 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) alternatively in the Court’s inherent jurisdiction.
2. The respondent to the Notice of Motion pay the applicant’s costs of the motion.
3. Mr Farshad Amirbeaggi be jointly and severally liable for the applicant’s costs of the motion.
4. Liberty to the applicant to apply to Ward P’s Associate within 14 days by notice of motion if a gross sums costs order is sought.
Catchwords: CIVIL PROCEDURE – Summary disposal – Dismissal of proceedings – Application for judicial review of decision of District Court – Dispute as to costs assessment – Whether proceedings an abuse of process after applicant’s debt compromised by Deed of Company Arrangement – Whether proceedings should be dismissed for want of due despatch
COSTS – Whether costs should be ordered of proceedings as whole where matter not determined on the merits – third-party costs order – Where solicitor on the record in the proceedings is the sole shareholder of represented party and has effectively funded the proceedings – Where solicitor is associated with incorporated legal practices which stand to benefit as creditors of the defendant company
Legislation Cited: Civil Procedure Act 2005 (NSW), s 98(4)
Corporations Act 2001 (Cth), ss 435A, 440D, 444D, 444E, 444G, 444H
Legal Profession Uniform Law Application Act 2014 (NSW), s 176
Uniform Civil Procedure Rules 2005 (NSW), rr 12.7, 13.4, 51.45
Cases Cited: Academy Construction & Development Pty Ltd (subject to Deed of Company Arrangement) [2024] NSWSC 808
ACN 627 087 030 Pty Limited v Poche [2025] NSWCA 66
Aurora Australasia Pty Ltd v Hunt Prosperity Pty Ltd (No 2) [2024] NSWSC 1210
BHNF Fong v Weller [2024] NSWCA 46
Bischof v Adams [1992] 2 VR 198
Brand2Content t/as Franchise Works v Dalby [2019] NSWCA 16
Carborundum Abrasives Ltd v Bank of New Zealand (No 2) [1992] 3 NZLR 757 at 765; (1992) 6 NZCLC 67,873
FPM Constructions Pty Ltd v Council of the City of Blue Mountains [2005] NSWCA 340
Hoser v Hartcher [1999] NSWSC 527
Huang v Attapallil [2017] NSWCA 161; (2017) 223 LGERA 81
Huang v Attapallil (No 2) [2017] NSWSC 1382
Kebaro Pty Ltd v Saunders [2003] FCAFC 5
Knight v FPC Special Assets Ltd (1992) 174 CLR 178 [1992] HCA 28
Re Heerey; Ex Parte Heinrich [2001] HCA 74; (2001) 185 ALR 106
Re Minister for Immigration & Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622; [1997] HCA 6
Category: Procedural rulings
Parties: A.C.N. 627 087 030 Pty Ltd (Applicant)
Adam Poche (Respondent)
Representation: Counsel:
Mr A P Cheshire SC (Applicant)
Mr J C Rogers with Mr C R Taylor (Respondent)
Solicitors:
Yates Beaggi Lawyers (Applicant)
ICL Lawyers (Respondent)
File Number(s): 2024/00454855
Publication restriction: Nil
WARD P: This is an application brought in the referrals list by notice of motion filed 30 October 2025 by Adam Poche (the applicant), who is the respondent in judicial review proceedings commenced in this Court by the respondent on the motion, an entity named ACN 627 087 030 Pty Limited, to which I will refer as YBL2. The notice of motion seeks an order pursuant to r 13.4 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), alternatively, in the Court’s inherent jurisdiction, dismissing these proceedings as an abuse of process. In the alternative, an order is sought pursuant to r 12.7 of the UCPR, alternatively in the Court’s inherent jurisdiction, that these proceedings be dismissed for want of prosecution. An order for costs is sought and, further, an order is sought that Mr Farshad Amirbeaggi (a solicitor who was formerly the sole director of YBL2) be jointly and severally liable for the respondent’s costs in these proceedings.
The background to this application is an ongoing dispute between the parties relating to costs that were incurred by Mr Poche when represented by YBL2. Broadly, by way of background, Mr Poche sought an assessment of the costs in relation to the proceedings in which Mr Amirbeaggi’s firm, YBL2, had acted for him. The result of the costs assessment process was to reduce the amount payable to YBL2 by a sum of $98,000. The effect of that, because Mr Poche had already paid that amount, was that a statutory debt arose from a date in about 7 May 2021 in that amount in favour of Mr Poche. YBL2 has litigated in relation to that debt seemingly ever since.
YBL2 sought to have the costs assessment decision reviewed and was unsuccessful in that challenge. YBL2 then brought an appeal to the District Court in relation to the outcome of the review and was again unsuccessful. YBL2 then brought an application for judicial review of that District Court decision in this Court, and that application was dismissed.
Proceedings were then back in the District Court, and a costs order was made against YBL2. Mr Poche sought that the costs order be made on a gross sum basis. The matter came before Gibson DCJ in the District Court in August and September 2024. Her Honour referred out to an independent costs assessor the quantification, on both an indemnity basis and the ordinary basis, of the costs of the proceedings, and subsequently adopted that report, and made orders for YBL2 to pay Mr Poche’s costs assessed on a gross sum basis in the amount of $216,372.20 (that is the figure noted by Kirk JA in his ex tempore judgment on 7 April 2025 (ACN 627 087 030 Pty Limited v Poche [2025] NSWCA 66 (ACN 627 087 030 Pty Limited v Poche) at [3]), to which I will refer in due course).
YBL2 then filed a summons on 6 December 2024 in this Court seeking judicial review of the decision made by Gibson DCJ on 19 November 2024 as to the gross sum costs. That summons identified two grounds of review.
judicial review of the decision of The Honourable Judge Gibson in the Matter of A.C.N 627 087 030 -v- poche (estimated by reference to the costs incurred by the company in the District Court at approximately $180,000, and if successful would substantially reduce or possibly reduce to nil the proof lodged in the VA by Mr. Poche and by Mr. Rosier),
On 23 June 2025, a document headed “Deed of Company Arrangement” was executed as a deed by Mr Farshad Amirbeaggi as “deed proponent”, and by the nominated deed administrators, Domenic Calabrett and Grahame Ward, as well as by YBL2 (by this time named Cost Assessment Dispute Pty Ltd (Administrators Appointed) ACN 627 087 030). That deed of company arrangement (DOCA) provided in recital H that, subject to the terms of the DOCA, the DOCA binds all creditors of the company in accordance with s 444D of the Corporations Act 2001 (Cth) and binds the company and its officers and members in accordance with s 444G of the Corporations Act.
The DOCA also recited, at E, that it would have the effect of maximising the prospect of the company continuing in existence, and assisting the unsecured creditors of the company to achieve a better and more certain return than they would in a winding up. (I interpose to note that the company, YBL2, has not traded for some time. There have since been two new incorporated legal practices associated with Mr Amirbeaggi.)
Mr Amirbeaggi does not dispute that the DOCA was executed on 23 June 2025 (see [13] of his affidavit affirmed 7 November 2025), although the DOCA itself does not bear an execution date.
It appears that the solicitors by then acting in the judicial review proceedings took the view that the entry into voluntary administration of the company effected a statutory stay of the judicial review proceedings, because they notified the Registrar of this Court to that effect on or about 12 May 2025, and the Registrar made orders in chambers, the first of which noted that pursuant to s 440D of the Corporations Act the proceedings were stayed. On that occasion, the Registrar vacated both the directions that had been set down for the judicial review proceedings on 14 May 2025 and the hearing that had been set down for 20 May 2025, listing the matter for further directions on 28 May 2025 and granting liberty to restore on three days’ notice.
Both parties accept that s 440D of the Corporations Act did not in fact impose a statutory stay on the judicial review proceedings brought by YBL2. I raise this because the suggestion that there was a statutory stay, and the order making the notation that I have referred to above, were referred to in the course of submissions on the present application by YBL2 as explaining why it should not be held that there had been a want of due despatch in relation to the judicial review proceedings.
The position as at 12 April 2025 was that there was a stay pending payment into court of the amount of $30,000 by way of security. The Registrar had noted that there was a stay pursuant to s 440D of the Corporations Act which both parties now accept was incorrect, and that is where the proceedings remained at that point.
Definitions
In this Deed:
…
Administrators means Domenic Calabretta and Grahame Ward in their capacities as joint administrators of the Company and Administrators means any of them.
…
Admitted Claim means a Claim against the Company that is admitted to proof by the Deed Administrators.
Admitted Creditors means Creditors with an Admitted Claim and includes any Creditor who elects to be excluded from any Dividend by written arrangement with the Deed Administrators pursuant to clause 9.8 of this Deed.
…
Cash Contribution means the amount of payable [sic] to the Deed Administrators by the Deed Proponent pursuant to clause 9.1 and 9.4 of this Deed.
Commencement Date means the date on which this Deed is executed by all parties to this Deed, and in the event it is executed by parties on different dates, the Commencement Date will be the date on which the last party executes.
Creditor means any person or entity that has a Claim against the Company.
…
Deed Fund means the fund comprising the amounts in clause 9.31 [sic].
Deed Proponents means the Company and the Directors jointly and severally.
Director means the director of the Company as at the Commencement Date being Paul Hatcliff.
…
Excluded Creditor means any Secured Creditor.
…
Litigious Claims means the claims of the Company as set out and expressed in clause 2.2 of the DOCA Proposal (including the manner and nature of which any Net Proceeds are anticipated to be made).
Net Proceeds means the proceeds of any Litigious Claims net of legal costs and disbursements incurred by the Deed Proponent in undertaking those claims to be applied only in the event of a successful outcome in each claim (as the case may be).
9.1 Deed Fund Contributions
The Deed Fund will comprise of the following:
(a) All funds held in the Administration bank account; and
(b) The greater of either and in the alternative:
(i) by on or before 24 months of the Deed the receipt of proceeds, net of litigation costs of those proceedings, of any recovery made in the following litigation:
(A) claim for professional negligence against Michelle Castle of Counsel concerning the matter of A.C.N. 627 087 030 -v- Adam Poche,
(B) Judicial Review of the decision of The Honourable Judge Newlinds SC in the matter of of A.C.N. 627 087 030 -v- Price & Theo,
(C) Judicial Review of the decision of the Honourable Judge Gibson in the matter of A.C.N. 627 087 030 -v- Poche,
(D) recovery of costs order against Adame Poche in Federal Court of Australia Proceedings number NSD24/2025,
(E) a pro-rata share (estimated at 25%) of any recovery made in SCNSW Proceedings against Hebbel Constructions Pty Limited and Bitar Pty Limited;
The claims / litigation in clause 9.1(b)(i)(A) to (E) are anticipated to bring a return of 100 cents in the dollar to participating creditors. The Deed Proponent will personally fund the reasonable legal costs incurred by the Company with its solicitors of the claims / litigation in clause 9.1(b)(i)(A) to (E) and only seek recovery of those legal costs upon success in each of the proposed claims / litigation, or
(ii) in event the litigation / claims in clause 9.1(b)(i)(A) to (E) do not bring about the anticipated return or either of the actions fail for whatever reason, the Deed Proponent at all times acting reasonably, then in the alternative to the proposal in clause 9.1(b)(i)(A) to (E), the Deed Proponent will personally upon the earlier of a determination of all the litigation / claims in clause 9.1(b)(i)(A) to (E), or 24 months, pay a sum equivalent to the sum which is a 10 cents in the dollar return to participating and adjudicated creditors (Guaranteed Amount), together with any recovery made in any of the claims / litigation matters identified in clause 9.1(b)(i)(A) to (E), into the Deed Fund, such payment to be made within 28 days of such determination / time stipulation.
9.2 (Cash Contribution)
Upon execution of this Deed the creditors agree, and are bound, to accept any dividend in full and final settlement of their entire claims against, and any liability of, the Company. Nothing in clause 9.1 prevents the Deed Proponent or the Company from paying additional amounts to the Deed Administrators to accelerate the payment of the Cash Contributions into the Deed Fund. The Cash Contribution will be held in the Deed Administrator’s trust account and applied to the Deed Fund in accordance with the terms of this Deed.
Mr Amirbeaggi, in his affidavit affirmed 7 November 2025, deposes at [15] that, pursuant to cl 9.1(b)(i)(C) of the DOCA, YBL2 undertook to prosecute the judicial review proceedings for the benefit of creditors. In fact, cl 9.1(b)(i)(C), as set out above, provides that the Deed Fund will comprise the greater of “either, and in the alternative” the receipt of proceeds net of litigation costs of any recovery made in litigation, being judicial review of the decision of Gibson DCJ in the District Court (that is the decision in relation to the gross sum costs order proceedings).
Clause 9.11 provides:
Insufficient Funds
(a) Where funds are insufficient to pay out a class or category of Admitted Creditors in full, then the available funds will be applied to that class of Admitted Creditors in proportion to the value of their Admitted Claims.
(b) Unsecured participating creditors of the Company must accept their entitlements under the deed in full settlement of all of their claims against the Company as at the date of the Voluntary Administrators were appointed.
11.1 Binding Effect
Without limiting sections 444D and 444G of the Corporations Act, this Deed binds:
(a) the Company and their Directors and Officers;
(b) the Deed Administrators;
(c) the Deed Proponents;
(d) each Creditor, excluding the Secured Creditors; and
(e) each Member.
11.2 Moratorium
Subject to sections 444D and 444E of the Corporations Act and save and except for any Claim arising under or subject to the Litigious Claims, and while this Deed remains in force, there will be a moratorium in favour of the Company until the Termination Date for all Claims arising prior to the appointment of the Administrators, and during that moratorium a Creditor, which includes for the avoidance of doubt an Excluded Creditor, (whether the relevant Claim is or is not admitted or established under this Deed) must not:
(a) wind up or take or concur in any step to wind up the Company or, without limiting the generality of the foregoing, present any application for the winding up, or continue to prosecute any application presented on or before the Commencement Date for the winding up, of the Company;
(b) institute, maintain, or prosecute any proceedings except for the purpose and to the extent provided in this Deed, or prosecute any legal proceedings or continue to prosecute any legal proceedings instituted on or before the Commencement Date in relation to any Claim against the Company or the Deed Proponent;
(c) take or concur in any step or any further step for the purpose of enforcing, whether by way of legal or equitable execution or otherwise, any judgment debt owed by, or arbitration award against, the Company or the Deed Proponent at the Admissible Claim Date, or any interest on that judgment debt or award;
(d) exercise any right of set off or defence, cross claim or cross action to which that Creditor would not have been entitled had the Company been wound up on the Admissible Claim Date; or
(e) commence or take any further steps in any arbitration against the Company or to which the Company is a party in relation to any matter arising or occurring before the Admissible Claim Date.
[20] On 24 September 2025…:
- Stay be lifted (Applicant / Plaintiff executed a DoCA on 28 April 2025)**.
- Applicant / Plaintiff to file any Amended Summons by 15 October 2025.
- The Applicant / Plaintiff is to provide security in the sum of $30,000 for the respondent’s costs by payment of that amount into Court by 15 October 2025 should an Amended Summons not be filed by 15 October 2025.
- List for further directions on any date after 15 October 2025.
[23] On 8 October 2025 …:
- Stay be lifted (Applicant / Plaintiff executed a DoCA on 28 April 2025).
- Applicant / Plaintiff to file any Amended Summons by 31 October 2025.
- The Applicant / Plaintiff is to provide security in the sum of $30,000 for the respondent’s costs by payment of that amount into Court by 31 October 2025 should an Amended Summons not be filed by 31 October 2025.
- List for further directions on any date after 31 October 2025.
Senior Counsel for YBL2 who candidly described the suggestion that there was a statutory stay as ham-fisted and, similarly, the DOCA as exhibiting ham-fisted confusion, submits that YBL2 has sought to prosecute the judicial review proceedings with due despatch insofar as it has sought to have the stay lifted by reference to the execution of the DOCA on 28 April 2025. However, it remains the case that there has been no payment into court of the security for costs, which was the condition of the original and only operative stay in relation to the proceedings.
It is against this background that Mr Poche has sought the orders indicated above in his notice of motion. His Counsel frankly concedes that Mr Poche is simply seeking to extricate himself from the morass of litigation that has followed from the costs assessment process in relation to the $98,000 statutory debt owing by YBL2 to him.
Turning to the two bases on which the dismissal of the judicial review proceedings is sought, they are as follows.
- Mr Krochmalik and Mr Notley also rightly recognised that a deed of company arrangement is not merely a contract, and drew attention to the consideration of principles of severance by Rees J in Re Antquip Hire Pty Ltd (subject to deed of company arrangement) (in liq) [2020] NSWSC 487 at [66]-[71] (“Antquip”), where her Honour observed that:
“DOCAs have statutory force by reason of sections 444B, 444D, 444G and 444H of the Corporations Act and not by its own force: Wellnora Pty Ltd v Fiorentino [2008] NSWSC 483 at [40] per Barrett J; Correa v Whittingham (No 2) [2013] NSWCA 471 at [75] to [76] per Gleeson JA with whom Barrett JA and Tobias AJA agreed. In Correa v Whittingham (No 2), Gleeson JA at [76] adopted the explanation of Barrett J in Reed Constructions Australia Ltd v DM Fabrications Pty Ltd [2007] NSWSC 1190; 25 ACLC 1,463 at [20]: (emphasis that of Gleeson JA)
… A deed of company arrangement derives its operative force from statute. … Sections 444D and 444G identify persons who are bound by the deed of company arrangement. Those persons are not parties bound together by contract. They are persons whose rights and obligations are created by law by virtue of the execution of the relevant instrument. They are akin, in that respect, to persons bound by a scheme of arrangement under Part 5.1 of the Corporations Act.
Thus, Gleeson JA concluded that there was “simply no room for the argument that independently of the Corporations Act a company may be bound by contract” as the binding force of a DOCA only arises by reason of section 444G: at [79]. If the DOCA never came into force for failure to comply with the requirements of the Corporations Act, its provisions would never become the source of any obligation: at [78].
As Barrett J further explained in Reed Constructions at [23]:
The main statutory impact is upon creditors. By force of s.444D(1), the deed binds them in relation to claims arising on or before the day specified in the deed under s.444A(4)(i). … Section 444B(6) causes the instrument to become a deed of company arrangement when executed by the specified persons. The provisions in the instrument then have statutory force. …
Perhaps of most assistance, in [Lehman FCAFC], Stone J concluded that DOCAs should be construed as statutes rather than contracts as a DOCA derives its operative force from statute: at [5]–[9]. A similar approach was taken by Perram J and Rares J, albeit Rares J did so without deciding whether that approach was correct: at [63]. The construction of the DOCA was not contested on appeal, where the High Court otherwise affirmed the Full Court’s decision: [Lehman HC]. The DOCA contained inconsistencies and errors. Stone J construed the relevant clause as purporting to give effect to other clauses in the deed, consistent with the principles of construction articulated by Dixon CJ and Fullagar J in Fitzgerald v Masters (1956) 95 CLR 420 at 426 –427, where their Honours observed in respect of inconsistencies, “Words may generally be supplied, omitted or corrected in an instrument where it is clearly necessary in order to avoid absurdity or inconsistency.”
As the DOCA in [Lehman FCAFC] purported to impose restrictions on creditors that went beyond what was contemplated by Part 5.3A, Stone J concluded that the DOCA lacked the necessary statutory force to bind creditors and, as the offending provisions were not severable, the DOCA must be declared void: at [41]. Notwithstanding the respondents’ reliance on the commercial realities behind the arrangements made in the DOCA, Stone J observed at [44]:
In my view Pt 5.3A has a more limited scope than these submissions recognise. The language of Pt 5.3A does not lend itself to a wholesale adjustment of the rights and obligations of a company’s creditors. Whether a wider scope would lead to a better commercial outcome and whether it would be appropriate to provide for that expansion of Pt 5.3A is a question for the legislature not for the Court.
Consistent with these authorities, it seems to me that DOCAs should be construed as statutes or, more precisely, as subordinate legislation. Construing DOCAs in this matter is perhaps unfortunate as, to my observation, DOCAs are often drafted in urgent circumstances where the proponent of the DOCA is experiencing financial stress such that DOCAs are frequently ill-drafted and certainly fall short of the standards of excellence of statutory draftspersons. Also, generally DOCAs appear to be prepared by accountants and insolvency practitioners rather than lawyers.
As to rules of statutory construction which may assist, and drawing heavily on Perry Herzfeld and Thomas Prince, Interpretation (2nd ed, 2020, Thomson Reuters (Professional) Australia), the general principles of statutory construction apply equally to the interpretation of subordinate legislation although the context in which the subordinate legislation is to be construed includes the legislation under which it is enacted: [14.10]. The validity of subordinate legislation may be challenged if it deals with a subject outside the scope of the empowering provision upon the authority of which it was purportedly made: at [10.10]–[13.40]. When subordinate legislation is open to two constructions, on one of which it would be within the empowering provision and on the other ultra vires, the first should be adopted: [14.60]. Where a provision of subordinate legislation is not authorised by the empowering legislation, the provision may in some circumstances be severed or read down so as to preserve the validity of the balance of the subordinate legislation, including by textual surgery using the “blue pencil” rule so that the valid portion operates independently of the invalid portion or, failing that, by treating the text as modified so as to achieve severance where in so doing there is no change to the substantial purpose and effect of the impugned provision, in particular, there is not left substantially a different law from what it would otherwise be: at [13.210] citing Harrington v Lowe (1996) 190 CLR 311 at 328.” [emphasis that of Black J]
- I recognise that, as Mr Notley points out, these observations were approved by Colvin J in Goldus Pty Ltd (Subject to Deed of Company Arrangement) v Cummins (No 4) (2021) 157 ACSR 118; [2021] FCA 1095 at [183], with which the Full Court of the Federal Court agreed, in dismissing the appeal, in Goldus Pty Ltd (subject to deed of company arrangement) v Australian Mining Pty Ltd (recs and mgrs apptd) [2023] FCAFC 27 at [82]. Mr Notley also fairly acknowledges that these decisions did not relate to questions of severance of third party releases contained in a deed of company arrangement.
10.2 Creditors of the Company
Notwithstanding the creation of the trust in clause 10.1 of this Deed, the Admitted Creditors remain creditors of the Company. The Deed Administrators and the Deed Proponents will provide each other with any information and assistance reasonably required in connection with adjudication of the Admitted Creditors’ debts.
a. Where the remedy to be provided by the Court “will produce no foreseeable consequences for the parties”: Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581-2 (Mason CJ, Dawson J, Toohey J and Gaudron J).
b. Where proceedings have become inutile because of events that have occurred since their commencement: Aust Mid-Eastern Club v Elbakht (1988) 13 NSWLR 697 (710B, Mahoney JA, Rogers AJA agreeing at 713E-F, Kirby P deciding on other grounds).
c. Where there is an absence of proportionality between the value or utility of the remedy sought and the resources (both private and public) required for its determination: Grizonic v Suttor [2008] NSWSC 914, [63]-[64] (Brereton J), see also Bleyer v Google Inc (2014) 88 NSWLR 670 [57], [62] McCallum J)
It is noted that the courts have expressed a greater willingness to intervene on the grounds of abuse of process where the litigation is satellite litigation, Mr Poche there citing Huang v Attapallil [2017] NSWCA 181 at [6] (White J) and Huang v Attapallil (No 2) [2017] NSWSC 1382 at [166]-[172] (Garling J). It is submitted that the judicial review application has no utility and that the only conclusion that can reasonably be drawn is that the proceedings were instituted to delay payment to the respondent while the applicant sought to strategise as to what steps it would take to avoid payment, and that having achieved that end, the only reason for continuation of the proceedings is to vex Mr Poche, YBL2’s former client.
It is submitted that the suggestion that the judicial review proceedings will contribute to any deed fund for ultimate distribution is a commercial nonsense.
Addressing those submissions orally, Senior Counsel for YBL2 accepts that there is no challenge to the underlying costs order that was the subject of the gross sum assessment determination, but submits that what is left open to YBL2 under the terms of the DOCA is an application to determine the quantum of the reduction of the debt owing to Mr Poche pursuant to that underlying cost order. It is submitted that the DOCA should be construed such that reference to the judicial review proceedings is not a reference to an attempt to recover money for the benefit of Creditors, it is an attempt to reduce a claim.
It is submitted (for YBL2) that what is contemplated by the DOCA in the provisions to which I have referred already, is that there is a claim for judicial review, a process by which that claim will be determined outside the DOCA, and that is the amount that would then be admitted in the liquidation. Clause 2.2.1.3 in that regard is said to be wrong, and is said not to have been intended to work in the way in which it is expressed. The submission is that the DOCA preserves the judicial review proceedings in order to permit the judicial review proceedings which, if successful, may result in a reduction of the amount owing to Mr Poche.
There is no dispute by YBL2 that the DOCA binds Mr Poche, but it is submitted by YBL2 that the general moratorium provision applies to the judicial review proceeding, and that that those clauses would have no meaningful operation were Mr Poche’s construction of that clause to be correct (T 19.35). It is submitted that, to give that part of the DOCA some effect, it should be interpreted as if it were agreed that these proceedings would be continued and determined and that any benefit to the company from a reduction of the amount of Mr Poche’s debt would be of benefit to the company.
It is submitted for YBL2 that nothing prevents the parties in the DOCA providing a process by which the amounts of claims may be determined outside of the DOCA, and, insofar as it be accepted that there may be now uncertainty as to the operation of the DOCA, it is submitted that any such uncertainty could be clarified by a resolution of the Creditors who have the ability to vary the DOCA pursuant to cl 15.3 at the instigation of the Administrators, and that, as I understand it, YBL2 would seek the opportunity of rectifying the DOCA in order to say that it had that effect, in order to permit the judicial review proceedings to be continued.
List of Creditors
- Daniel Frisken – receiver appointed by the company (e) $100,000…
- Mark Bland – accountant to the company (e) $15,000…
- Andrew Ashton – accountant to the company (e) $20,000…
- William Roger Stone Lawyers – solicitor for the company (e) $10,000…
- Byrnes Corporate Advisory – corporate advisory to the company (e) $20,000…
- Hatcliff Corporate Advisory – corporate advisory to the company (e) $20,000…
- A.C.N. 640 543 979 Pty Limited as trustee for the YBL2020 Trust trading as Yates Beaggi Lawyers (e) $800,000
- A.C.N. 674 955 287 Pty Limited as trustee for the YBL2024 Trust trading as Yates Beaggi Lawyers (e) $700,000
- Andrew Price and Elisabeth Theodore (e) $250,000…
- Adam Poche (e) $350,000…
- Hebbel Constructions Pty Limited I Bitar (e) $50,000…
In my opinion, there is an abuse of process in the continuation of these proceedings. The disproportionality of the dispute defies belief. The original dispute was over a $98,000 statutory debt owing to Mr Poche. From the material before me it would appear that the costs that have been incurred by YBL2 in seeking to overturn or challenge that debt are in the order of some $180,000, and it is quite clear from the discussion in the course of submissions that there is no realistic end to the litigation in the sense that what is contemplated, if the judicial review proceedings are successful, is that the matter will be remitted to the District Court for yet another hearing in relation to the costs. If there is a decision not to make a gross sum costs order, there will then follow a costs assessment process from which one might assume there are likely to be continuing objections and appeals. It is simply disproportionate, and satellite litigation in the extreme, for the judicial review proceedings to continue in circumstances where the underlying debt has been admitted (sic; compromised). Mr Poche is bound to accept a pari passu distribution of whatever, if anything, may ultimately turn out to comprise the Deed Fund.
While there is a sense in which it can be said that there is utility in the judicial review proceedings (insofar as they will, if conducted to the conclusion of the proceedings, result in, or potentially result in, a different determination of the amount of the gross sum costs order), I do not accept that the continuation of the proceedings is anything other than an abuse of process.
The second ground on which Mr Poche seeks a dismissal of the proceedings is for want of due despatch. I do not propose to say very much about this because it is unnecessary in view of the conclusion I have reached on the first issue. I note that, in submissions, Mr Poche has noted that the summons is (and as has been observed by Kirk JA to be (see ACN 627 087 030 Pty Limited v Poche at [4])) in parts defective, and that, where a valid right of appeal would lie, the Court would be unlikely to exercise any power of judicial review (Mr Poche citing Re Heerey*; Ex* Parte Heinrich [2001] HCA 74; (2001) 185 ALR 106 at 109 (Kirby J), and BHNF Fong v Weller [2024] NSWCA 46 at [26]-[30] (Kirk JA)).
Mr Poche in support of his application for the proceedings to be dismissed for want of due despatch points to the following procedural chronology: the fact that in defiance of the requirement by r 51.45 of the UCPR YBL2 has failed to file the requisite documents; that YBL2 was granted leave on 3 February 2025 to file an amended summons by 17 February 2025, which it did not do; that YBL2 was ordered on 19 February 2025 to comply with its obligations under r 51.45 by 31 March 2025, which it failed to do; that YBL2 was ordered to file its submissions on its application for a stay of the costs awarded by 21 March 2025, which it failed to do (in part, resulting in the adjournment of the hearing of that application on 24 March 2025); that YBL2 was ordered on 7 April 2025 to file an amended summons explaining the basis of its claim by 17 April 2025, which it failed to do, and was directed to comply with r 51.45 by the same date, which it again failed to do.
It is also noted, as I have previously referred to, that YBL2 was ordered to pay security for the respondent’s costs into court by 22 April 2025 and failed to do so. The proceedings having been stayed on 7 April 2025, Mr Poche notes that, subsequent to entering into voluntary administration, YBL2 has not proactively sought to move the case forward in any meaningful manner (although I note that Senior Counsel for YBL2 points to steps taken by YBL2 to have the stay lifted and for orders for payment into court).
I interpose to note that the orders proposed by YBL2 in September and October 2025 in relation to the provision of security were framed as follows:
The Applicant / Plaintiff is to provide security in the sum of $30,000 for the respondent’s costs by payment of that amount into Court by 15 October 2025, should an Amended Summons not be filed by 15 October 2025.
That seems to make the order for payment of security conditional on the filing of an amended summons by that date, which is not what the order for security originally provided. But I note that, in submissions before the Court, Senior Counsel for YBL2 informed the Court that he had instructions that his client would be in a position to comply with any order which might be made for provision of security for costs within a very short timeframe from today.
Mr Poche has submitted that the deficient nature of the application, and the dilatory manner in which YBL2 has advanced the application, affords ample ground for dismissal for want of prosecution, noting the factors to be considered in that regard as outlined by Simpson J, as her Honour then was, in Hoser v Hartcher [1999] NSWSC 527 at [19]-[30]:
It seems to me that the following principles are relevant to the exercise of the discretion to strike out for want of prosecution. The list is not intended to be exhaustive:
(1) the ultimate question is whether, on balancing the prejudice to the respective parties by making or not making an order, justice demands that the action be dismissed: Stollznow v Calvert (1980) 2 NSWLR 749 at 751 F (Court of Appeal); Razvan v Berechet, unreported Court of Appeal, 23 February 1990; Vilo v John Fairfax and Sons Limited, unreported, 19 November 1995, per Sperling J;
(2) the discretion should be exercised only in a clear case where it is manifestly warranted; Razvan, per Kirby P; as is generally the case with discretionary decisions, each case depends upon its own facts. Rigid formulae should not be applied to the exercise of the discretion: Stollznow v Calvert at 751 D;
(3) any explanation offered by the plaintiff for the delay in proceeding must be considered: Burke v TCN Channel Nine Pty Limited, unreported, 16 December 1994, per Levine J;
(4) personal blamelessness on the part of a plaintiff (as distinct from any tardiness or other fault on the part of his/her/its legal representative) is relevant: Stollznow, p73.
(5) a defendant who takes no steps to secure progress in the proceedings, or to activate an apparently inactive plaintiff or who stands by in the hope that the passage of time will ensure the quiet death of the proceedings or that the longer delay will strengthen the case for striking out, runs the risk that that very behaviour will operate to his/her/its disadvantage. A defendant has two choices: to attempt to prod the plaintiff into action, or to stand by, doing nothing, trusting that time will bring about the slow death of the action. Either choice represents something of a gamble, dependent upon future events that the defendant is unable with any degree of confidence to predict. If the defendant opts for the former course, of prodding the plaintiff into action, it may succeed in doing so, precluding an application to strike out. On the other hand, if the plaintiff remains inert, the defendant’s case for striking out strengthens with passing time. If the defendant chooses the latter option and takes no action, the plaintiff may take no further steps, or may take no further steps until such irremediable prejudice is caused to the defendant that the application to strike out will succeed; if, however, some other event galvanises the plaintiff into action the defendant, having done nothing to progress the matter, can hardly be heard to complain of the plaintiff’s earlier inactivity: Calvert v Stollznow, 1 April 1980, Ritchie’s Supreme Court Procedure, (NSW) Vol 2, para 13, 022, per Cross J (at first instance); and in the Court of Appeal per Moffitt J, p 753; Vilo, p 10; McBride v Australian Broadcasting Corporation, unreported 6 November 1998, per Levine J*; Bass v TCN Channel Nine Limited*, unreported 25 July 1997, per Levine J; Hart v Herron, unreported, 3 June 1993, Court of Appeal per Priestley JA;
(6) delay between the date the cause of action arose and the commencement of the proceedings may be a relevant factor: Calvert v Stollznow, per Cross J; Burke v TCN. But in my view, this circumstance must be treated with some caution. The weight that can be accorded to that delay is limited. Where an action is commenced within the period provided for by an applicable statute of limitations, it would not ordinarily be appropriate to take that period into account. However, if a plaintiff has delayed significantly in the commencement of the proceedings, and that delay is followed by further lethargy in the advancement of the proceedings, the effect of the initial (but permissible) delay is compounded. The real question is not the length of the delay, but the impact that delay has upon the defendant’s capacity properly to defend the plaintiff’s claim. That will be a question of fact in each case. While there may be some prejudice presumed by reason of the passage of time, much will depend upon the nature of the proceedings, and the identification of the issues involved in the litigation. Where, for example, at the close of pleadings it can be seen that there are disputed questions of fact dependent upon the oral evidence of witnesses, or their recollections, the prejudice will plainly be greater than in cases that depend essentially upon the application of legal principle to largely undisputed facts, or upon disputed questions of fact that will be resolved by reference to documentary or other objective evidence not likely to be affected by the effluxion of time;
(7) the onus lies on the defendant to establish any prejudice upon which reliance is placed. The disappearance or death of witnesses, the fading of their recollections, or the destruction of records, are some obvious examples of the kind of prejudice that might arise;
(8) prejudice to a defendant caused by delay has to be balanced against prejudice to a plaintiff deprived of an otherwise valid claim; delay in the commencement of proceedings by a plaintiff is sometimes taken as evidence contra-indicating prejudice to the plaintiff in the sense that he/she/it has evinced no interest in his/her/its own case: Burke, supra. Such an inference may be contra indicated by explanatory evidence; in this regard the plaintiff’s personal responsibility for the delay is an important factor as is any explanation provided for the delay;
(9) what the defendant has (or has not) done by way of preparation for trial may be a factor. This is a distinct question from that concerning any steps taken (or not taken) by the defendant in prompting the plaintiff to action. A defendant who has not interviewed witnesses, taken statements or collected documents, after being served with the claim, has a less meritorious complaint about the effect of prejudice caused or presumed by reason of delay: McBride v ABC, unreported, 6 November 1998, per Levine J;
(10) the plaintiff’s prospects of success is a relevant factor. If it appears that the prospects are minimal, the discretion is more likely to be exercised in favour of the defendant. Conversely, where the plaintiff’s case is strong (absent the kind of prejudice to the defendant to which I have referred) it is less likely that justice will be done by striking the action out: Razvan, per Kirby P;
(11) the exercise of the discretion to strike out should not incorporate any element of punishing a tardy plaintiff, or of excluding one who may appear to have some unworthy characteristics: Razvan, per Kirby P. The ultimate aim of a court is the attainment of justice: The State of Queensland v J L Holdings Pty Limited (1997) 189 CLR 146. To adapt the words of the High Court in that case, discretions such as that presently invoked ought not to be used to supplant the overall aim of the attainment of justice.
That leaves the question of costs. There is no reason why costs should not follow the event, and there will be an order that the respondent to the motion pay the applicant’s costs of the motion.
The applicant has sought its costs of the proceedings as a whole. In Re Minister for Immigration & Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622; [1997] HCA 6 (Ex parte Lai Qin), McHugh J stated at 624-625 in relation to the exercise of the discretion to award costs where there has been no hearing on the merits:
In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order.
In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extracurial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action. In administrative law matters, for example, it may appear that the defendant has acted unreasonably in exercising or refusing to exercise a power and that the plaintiff had no reasonable alternative but to commence a litigation. Thus, for example, in R v Gold Coast City Council; Ex parte Raysun Pty Ltd, the Full Court of the Supreme Court of Queensland gave a prosecutor seeking mandamus the costs of the proceedings up to the date when the respondent Council notified the prosecutor that it would give the prosecutor the relief that it sought. The Full Court said that the prosecutor had reasonable ground for complaint in respect of the attitude taken by the respondent in failing to consider the application by the prosecutor for approval of road and drainage plans.
Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. This is perhaps the best explanation of the unreported decision of Pincus J in South East Queensland Electricity Board v Australian Telecommunications Commission where his Honour ordered the respondent to pay 80 per cent of the applicant’s taxed costs even though his Honour found that both parties had acted reasonably in respect of the litigation. But such cases are likely to be rare.
If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases. [Footnotes omitted]
The final issue is the application for a third-party costs order against Mr Amirbeaggi. In submissions, Mr Poche cites Knight v FPC Special Assets Ltd (1992) 174 CLR 178 at 188 (Mason CJ and Deane J), and 202 (Dawson J); [1992] HCA 28, and refers to the factors that are considered in determining whether a third party should be ordered to pay the costs. Mr Poche submits that Mr Amirbeaggi is the moving party; that he was the only party who stood to gain by the commencement of the proceedings; and that the costs have been incurred on his account alone and facilitated by his effective funding of the litigation through direct payments and by his newly incorporated legal practice. It is noted that he was the deed proponent, albeit not defined as such in the DOCA, and it is submitted that he is the architect of the continuation of the proceedings.
In respect of the power of the Court to order costs to be borne by a non-party, Mr Poche also refers to FPM Constructions Pty Ltd v Council of the City of Blue Mountains [2005] NSWCA 340 at [209] (Basten JA); Aurora Australasia Pty Ltd v Hunt Prosperity Pty Ltd (No 2) [2024] NSWSC 1210 at [21] (Rees J); Bischof v Adams [1992] 2 VR 198 at 204-205; Kebaro Pty Ltd v Saunders [2003] FCAFC 5 at [70]; and Carborundum Abrasives Ltd v Bank of New Zealand (No 2) [1992] 3 NZLR 757 at 765; (1992) 6 NZCLC 67,873.
I note in this regard that the overriding consideration, when making a third-party costs order, is whether it is in the interests of justice to make the order (see Brand2Content t/as Franchise Works v Dalby [2019] NSWCA 16 at [12]-[13] (Simpson AJA)). In the present case there is no doubt that Mr Amirbeaggi has been involved to an extensive degree in relation to the proceedings in the sense that he has been associated with each of the incorporated law practices, but particularly YBL2, and that he was so involved up until he resigned as a director shortly after the order was made for payment for security for costs.
As to the benefit that he would receive from the outcome of the judicial review proceedings, he is the sole shareholder of YBL2 and a benefit to that company may well be thought to flow through ultimately to him. But I note that the mere fact that a person may benefit from litigation does not, without more, justify an order of an award of costs.
It is also relevant that Mr Amirbeaggi appears to have effectively funded the proceedings and that he proposed the DOCA by which Mr Poche’s debt was compromised.
In circumstances where YBL2 is unlikely to be in a position to recompense Mr Poche for the costs incurred in the bringing of this application, and there is force in my opinion to the conclusion that Mr Poche has been vexed by the ongoing litigation in relation to costs orders over many years which I infer has been at the instruction of Mr Amirbeaggi, then I consider it is appropriate that there be a non-party costs order made against Mr Amirbeaggi.
Accordingly, I make the following orders:
Dismiss the proceedings as an abuse of process pursuant to rule 13.4 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) alternatively in the Court’s inherent jurisdiction.
The respondent to the Notice of Motion pay the applicant’s costs of the motion.
Mr Farshad Amirbeaggi be jointly and severally liable for the applicant’s costs of the motion.
Liberty to the applicant to apply to Ward P’s Associate within 14 days by notice of motion if a gross sums costs order is sought.
**********
Amendment to counsel representation on coversheet
A.C.N. 627 087 030 Pty Ltd
Poche [2025] NSWCA 252
(2017) 223 LGERA 81
(1992) 174 CLR 178
(2001) 185 ALR 106
(1997) 186 CLR 622
(1956) 95 CLR 420
(1996) 190 CLR 311
(1992) 175 CLR 564
(1988) 13 NSWLR 697
(2014) 88 NSWLR 670
(1980) 2 NSWLR 749
(1997) 189 CLR 146
The judicial review proceedings were dismissed as an abuse of process; YBL2 was ordered to pay the applicant’s costs of the motion, with Amirbeaggi jointly and severally liable, and the applicant was given liberty to apply within 14 days for a gross-sums costs order. No order was made for the costs of the proceedings as a whole, apart from the existing security-for-costs order.
The first was that the primary judge fell into error of law on the face of the record and/or jurisdictional error by failing to disqualify herself from determining whether the referee’s report ought be adopted (because the hypothetical fair-minded lay observer might reasonably apprehend that the Court might not have brought an impartial and unprejudiced mind to the resolution of the issues). That ground was supplemented by particulars, including, in particular (a), that a fair-minded lay observer might have apprehended that the primary judge may have decided the case other than on its legal and factual merits because, first, the primary judge was the subject of an extant judicial complaint by the plaintiff to the proceedings regarding her conduct in the proceedings, and, second, the primary judge’s associate had, in a communication with the referee sent prior to the adoption hearing without notice to, but copying, the parties to the proceedings, stated that “her Honour is pretty impressed with your report”.
The second ground identified in the judicial review summons was that her Honour fell into error of law on the face of the record and/or jurisdictional error, by misconstruing, misapprehending or misapplying the law under s 176 of the Legal Profession Uniform Law Application Act 2014 (NSW), and by failing to take into account proportionality of costs incurred by the defendant in the proceeding in determining the sum of costs to be awarded, pursuant to s 98(4) of the Civil Procedure Act 2005 (NSW).
What then followed was a motion by YBL2 seeking a stay of the orders made by Gibson DCJ, that motion being filed on 26 February 2025; and a motion filed by Mr Poche on 11 March 2025 seeking security for costs. Those motions came before Kirk JA for hearing in the referrals list on 7 April 2025.
His Honour in his ex tempore reasons in relation to those motions noted that a stay of Gibson DCJ’s orders had been ordered in the District Court by Dicker SC DCJ on two occasions, expiring on 3 March 2025 (ACN 627 087 030 Pty Limited v Poche at [6]). His Honour considered it clear that the balance of convenience, taking into account the risk of prejudice, favoured Mr Poche in relation to the application for a stay. His Honour made various observations as to what he considered to be YBL2’s relatively limited prospects of success in the judicial review proceedings, and said (see [15]) that it was clear in his view that the interests of justice militated against the grant of a stay. The application for a stay was refused.
His Honour then turned to the security for costs motion and, for reasons that I do not need here to recount, determined that an order for security for costs should be granted, and that it was appropriate to take a broadbrush to the assessment of those costs. Having regard to the costs estimates provided by the solicitor for Mr Poche, his Honour was of the view that an appropriate allowance for security for costs was $30,000. His Honour ordered that the applicant provide within 15 days security in the sum of $30,000 for the respondent’s costs by payment of that amount into court (at [29]). That was on 7 April 2025.
In his Honour’s ex tempore reasons, his Honour also referred to an order sought by Mr Poche that the summons be dismissed as incompetent in circumstances where the ground of review concerned an interlocutory decision of the District Court and where there had not been an application for leave to appeal, but his Honour did not need to deal with that (at [30]-[32]). His Honour also noted that there was a complaint that YBL2 had not filed the documents required by r 51.45 of the UCPR. His Honour stayed the application for judicial review until security was provided in accordance with order (2) that was made on that occasion.
What transpired thereafter was that YBL2 failed to comply with the order to make payment for security for costs by 22 April 2025. On 28 April 2025, YBL2 was placed into voluntary administration. Prior to entry of YBL2 into voluntary administration on 28 April 2025, but after the order for the provision of security for costs made by Kirk JA on 7 April 2025, Mr Farshad Amirbeaggi, who was the sole director of YBL2, was replaced as director by Mr Paul Hatcliff, who I infer, (by reference to a preliminary list of Creditors emailed by the deed administrators to Mr Poche’s solicitors on 7 May 2005) is associated with the entity Hatcliff Corporate Advisory, a creditor of YBL2, but nothing turns on this.
After 28 April 2025, on 23 May 2025, Mr Amirbeaggi, who was and remains the sole shareholder of YBL2, put to the administrators a proposal that the company execute a deed of company arrangement. The proposed terms of the deed of company arrangement included that the deed fund was to comprise all funds held in the administration bank account, together with the greater of “by, on or before 24 months of the DoCA, the receipt of proceeds, net of litigation costs of those proceedings, of any recovery made in the following litigation...” (cl 2.2.1).
The proceedings there referred to included, at cl 2.2.1.3 of the proposal:
Relevantly, the DOCA contained the following definitions in cl 1.1:
In reply submissions, the suggestion that there was utility in the judicial review proceedings progressing was again rejected by Counsel for Mr Poche, who referred to the objects in s 435A of the Corporations Act, the objects of Pt 5.3A being to maximise the chances of the company, or as much as possible of its business, continuing its existence (which is not realistic in circumstances where it has now not traded for some time and appears to have been replaced by other incorporated legal practices) or, if it is not possible for the company or its business to continue, to result in a better return for the company’s creditors and members than would result from an immediate winding up of the company.
Mr Poche submits that those objectives are not satisfied by the interpretation of the DOCA that is put forward by YBL2. Mr Poche accepts that cl 10.2 envisages an adjudication process, but says that is an adjudication process by the Deed Administrators, and it is submitted that it is an unrealistic and uncommercial interpretation of the DOCA to say that it envisages, for one portion of an admitted debt that has been compromised, a lengthy process in relation to the determination of the quantum of that debt which will be relevant only to inter-creditor determinations and will not make any relevant or material difference.
The Deed Administrator’s List of Creditors identifies the creditors as follows:
It was submitted for Mr Amirbeaggi that he is a solicitor and the fact that he has been involved in the matter throughout is not of itself a basis for the making of a third-party costs order but it seems to me that in circumstances where related entities, being the incorporated legal practices with which he is associated, have been involved and stand to benefit as creditors of the company, he is going beyond merely being a solicitor acting for a party in the proceedings. The interests of justice in this case, in circumstances where it seems highly unlikely that Mr Poche will recover anything of his original $98,000 statutory debt, let alone the subsequent costs, are such that such an order is appropriate.