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[2025] NSWCA 66
Court of Appeal (NSW)
2025-04-07
Kirk JA
Original judgment source is linked above.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: ACN 627 087 030 Pty Limited v Poche [2025] NSWCA 66
Hearing dates: 07 April 2025
Date of orders: 07 April 2025
Decision date: 07 April 2025
Before: Kirk JA
Decision: (1) The applicant’s motion filed on 26 Feb 2025 seeking a stay of the orders of the District Court made on 19 November 2024 is dismissed with costs.
(2) The applicant is to provide within 15 days security in the sum of $30,000 for the respondent’s costs by payment of that amount into Court.
(3) The application for judicial review is stayed until security is provided in accordance with order 2 or as otherwise ordered by the Court.
(4) The respondent’s notice of motion of 11 March 2025 is otherwise dismissed.
(5) The applicant is to pay the respondent’s costs of the respondent’s motion of 11 March 2025.
(6) The applicant is to file any amended summons seeking judicial review by 17 April 2025.
(7) Time for compliance by the applicant with r 51.45 of the Uniform Civil Procedure Rules 2005 (NSW) is extended to 17 April 2025.
Catchwords: APPEALS – procedure – stay of orders in District Court pending outcome of judicial review application in Court of Appeal – serious issue may be raised – no significant prospects of success on broadbrush view – balance of convenience taking account of risk of prejudice militates against stay
CORPORATIONS – practice and procedure – security for costs – some delay in seeking security – no inference that ordering security would stifle proceedings – security appropriate – case of confined issues – sufficient for one junior counsel to appear in short hearing – broadbrush assessment of costs to be allowed
Legislation Cited: Civil Procedure Act 2005 (NSW), ss 56-58
Corporations Act 2001 (Cth), s 1335(1)
District Court Act 1973 (NSW), s 127
Uniform Civil Procedure Rules 2005 (NSW), r 51.45
Cases Cited: Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685
Fong bhnf Fong v Weller [2024] NSWCA 46
Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383
Category: Procedural rulings
Parties: ACN 627 087 030 Pty Limited (Applicant)
Adam Poche (First respondent)
District Court of New South Wales (Third respondent)
Representation: Counsel:
G Sirtes SC (Applicant)
JC Rogers (First respondent)
Solicitors:
Yates Beaggi Lawyers Pty Ltd (Applicant)
ICL Lawyers (First respondent)
File Number(s): 2024/454855
Publication restriction: Nil
These applications concern a long running costs dispute between the two parties. The costs dispute originates in a probate and family provision claim in which the applicant in this proceeding was representing the first respondent (the respondent). Since litigation was completed there has been extensive further disputation between the parties as to the costs charged by the applicant to the respondent in the course of those proceedings. That litigation has extended all the way up to this Court previously on a judicial review application related to a previous decision of the District Court: ACN 627 087 030 Pty Limited trading as Yates Beaggi Lawyers v Poche [2024] NSWCA 145.
Following that determination of this Court, the matter returned to the District Court. The respondent made an application to the District Court for a gross sum costs assessment in relation to costs incurred in the course of the proceedings in the District Court. The matter came again before Gibson DCJ on 30 August and 13 September 2024. Her Honour handed down judgment on 19 November 2024: ACN 672 087 030 Pty Limited trading as Yates Beaggi Lawyers v Poche (No 3) (decision not published on the NSW Caselaw website).
Her Honour made a range of orders but of most significance was an order that the current applicant pay the respondent’s costs assessed on a gross sum basis in the amount of $216,372.20. The applicant filed in this Court on 6 December 2024 a summons seeking judicial review of the decision of her Honour made on 19 November 2024. Two grounds are identified in that summons. The first is that her Honour fell into error in failing to disqualify herself on the basis of bias. Two particulars are provided of that complaint. A second ground is expressed as follows:
The Court below (Gibson DCJ) 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).
The first ground of review is readily understandable in the circumstances of the case. I will say something shortly about what I consider to be its prospects of success. The second ground is not readily understandable and nothing in the materials before me articulates the exact nature of the complaint made. Senior counsel now appearing for the applicant conceded that it was not clear precisely what was meant to be raised by that ground.
There are two motions now before me. I will deal first with the motion filed by the applicant seeking a stay of the orders below, being a motion made on 26 February 2025.
I note that a stay of the orders had been ordered in the District Court by Dicker DCJ on two occasions, expiring on 3 March 2025. It is clear that his Honour made those orders in order to enable a stay application to be made to this Court. No point was taken by the respondent as to the delay between the expiry of the stay order below and the application now being heard in this Court.
Principles relating to a determination of such a stay on an appeal are well settled. Notably, in Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383, this Court said the following:
[18] Thus the relevant principles are analogous to those which govern the grant of interlocutory relief before trial to protect the status quo. The appellant must show that the appeal raises serious issues for the determination of the appellate court, and that there is a real risk that he will suffer prejudice or damage, if a stay is not granted, which will not be redressed by a successful appeal. This requirement will be satisfied if the appeal will be rendered abortive or nugatory unless a stay is granted. If these pre-conditions are established the Court will then consider the balance of convenience.
Although those principles are directed to an appeal, I see no reason that they would not be equally applicable in the circumstances of a stay being sought in this Court in the context of a judicial review application. It is also relevant to take account of the possibility of conditions being granted on a stay in order to achieve fairness between the parties: see eg Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685 at 694-695.
I am prepared to accept that a serious issue may be raised in relation to at least the first ground identified in the summons in this matter. That being said, and taking account of the fact that prospects of success may be a relevant factor in relation to whether or not a stay should be granted, it currently appears to me that the bias argument does not have significant prospects of success on a broadbrush view. That being said, I recognise that I do not have the benefit of developed arguments in relation to that point.
I currently cannot see that the second ground has any real prospects of success in circumstances where, as I have already indicated, exactly what is meant by that ground is not apparent.
I will consider the issues of a real risk of prejudice and the balance of convenience together. The starting point is that the respondent is entitled to the fruits of the judgment. As indicated, the main point at issue that is sought to be challenged is a gross sum costs order with respect to an amount of approximately $216,000. The respondent has pointed out furthermore that there is a judgment sum in favour of the respondent for an amount of approximately $98,000, being an amount of an assessed overpayment made by the respondent to the applicant in relation to legal costs. The liability for that amount is no longer at issue, yet the amount remains unpaid.
Another relevant fact is that it is clear that one way or another the principal of the incorporated law firm, which is the applicant, is Mr Farshad Amirbeaggi. Neither the applicant nor Mr Amirbeaggi have offered this Court any proposal or undertaking which might seek to ameliorate the effects of a stay being granted and thus mitigating any harm that might be caused to the respondent. Neither the company nor Mr Amirbeaggi has even proffered the undertaking as to damages. At the very least such undertaking would normally be expected in relation to such an application.
Further, it has not been established to my satisfaction that there would be any significant prejudice to the applicant were a stay not to be granted. There seemed to be an assumption made in the written submissions filed by Mr Amirbeaggi (prior to senior counsel becoming involved) that if an amount was to be paid to the respondent then there would be no prospects of that amount being recovered were this Court in the judicial review application to overturn the decision of Gibson DCJ in a way which ultimately favoured the applicant as to its costs liability. That assumption is not made good on the evidence. I am not persuaded that were a sum of money to be paid to the respondent then the respondent would be unable or unwilling to repay any amount were that to become necessary down the track.
I accept there is some possibility that not to grant a stay might cause some practical difficulties for the applicant, but the nature of those difficulties was not developed in any significant respect. I accept that the evidence suggests the applicant company has no assets of any substance apart perhaps from some potential causes of action. However, the nature of those causes of action was not developed before me and I do not give that evidence any significant weight. Furthermore, in circumstances where there is an undisputed debt of some $98,000, the fact that a further liability might cause some difficulty to the applicant is of little weight in my view.
It is clear in my view that the balance of convenience, taking account of the risk of prejudice, favours the respondent. The overall discretionary assessment must also take account of what I have said about what I currently consider to be the applicant’s relatively limited prospects of success in this matter. It is clear in my view that the interests of justice in this case militate against the grant of a stay and the application for a stay is refused.
Where a corporation is plaintiff in any action or other legal proceeding, the court having jurisdiction in the matter may, if it appears by credible testimony that there is reason to believe that the corporation will be unable to pay the costs of the defendant if successful in his defence, require sufficient security to be given for those costs and stay all proceedings until the security is given.
There is no real dispute in this case that, at least on the evidence before me, the corporation will not be able to pay the costs of the respondent if he succeeds in defending this application for judicial review. The eligibility requirement for security for costs is thus established.
It is then necessary for me to consider whether in my discretion I should order security for costs and, if so, in what amount. In written submissions provided by Mr Amirbeaggi (again prior to the involvement of senior counsel) he referred to five relevant considerations which he suggested militated against an order for security for costs.
The first was that the first defendant delayed seeking security for costs but has not provided an explanation for his delay. The context of that argument is that, as noted, this summons seeking judicial review was filed on 6 December 2024 and the motion seeking security was only filed on 11 March 2025. I accept that there is some relevant delay. In my view, however, whilst that is a factor relevant to assessment of the quantum of security for costs payable, it is not of such significance as to preclude an order for security being made. There is still significant work left to be done in preparation for the hearing of the judicial review application and in those circumstances I do not consider delay should prevent such an order being made.
The second consideration invoked by the applicant is that the applicant is effectively in the position of a defendant. What was meant by that argument or claim was not developed. I do not accept that the proposition is correct.
The third consideration relied upon by the applicant was that the order of security would stifle proceedings that have been on foot for the last four months and have a final date fixed for hearing. I note that this matter has been listed for hearing on 20 May 2025. I am not persuaded of the significance of this consideration given the following. As already explained it is clear that the applicant itself has minimal assets, however, there is no evidence that Mr Amirbeaggi himself cannot come out from behind the company and make a payment for security for costs for the benefit of the entity of which it seems he is the principal. There is no express evidence that ordering security in any particular amount would stifle proceedings. Mr Amirbeaggi in effect simply seeks for me to draw that inference from the asset position of the applicant. I am not prepared to draw that inference in all the circumstances.
The fourth consideration relied upon is that the proceedings concern a matter of public importance. Again that proposition is not developed. I do not accept it.
The fifth relevant consideration is that there has been no delay by the applicant in prosecution of the proceedings. I accept that that is so. That does not however militate in any significant way against a grant of security.
There are other factors relevant to whether or not security for costs should be ordered, including matters of the kind raised by ss 56-58 of the Civil Procedure Act 2005 (NSW). Another relevant factor of note is the prospects of success of the proceedings about which I have already made some comment. In the circumstances, I have no hesitation in reaching the view that an order for security for costs under s 1335(1) is appropriate in the circumstances.
What remains then is to assess the appropriate amount of security for costs. The solicitor for the respondent has provided a table behind one of his affidavits which articulates the costs expected to be incurred in the judicial review application. The assessment is a total of some $63,000. The solicitor, Mr Paul Taylor, then applies a discount of 20% which reduces the amount claimed to some $50,000.
In my view an amount of that size is not warranted, taking account of three factors. First, as noted, this application for security for costs was made relatively late. I do note that some explanation has been made by Mr Taylor in his materials as to why that was. Even taking account of that evidence, it still appears to me that the application was relatively late. Some of the costs incurred to date therefore should not be the subject of an order for security for costs.
Secondly, taking account of the nature of the two grounds of the summons seeking judicial review, it currently appears to me that this is a case of very confined issues. As already noted, it is not apparent what, if anything, the second ground raises. As for the first ground, I agree with what was suggested by senior counsel now appearing for the applicant that this application for judicial review should be capable of being dealt with in no more than about an hour and a quarter or so. It is certainly not a matter which should occupy this Court for a whole day, yet that is the basis upon which the costs estimate has been prepared by Mr Taylor.
The third factor overlaps to some extent with the second. The costs estimate proceeds on the basis that two counsel will appear for the respondent. Mr Rogers, who appears today for the respondent, explained that he and another counsel have had some involvement in this matter from time to time and it is proposed that they both appear on the final determination of the judicial review application. I accept that is a relevant consideration. Even so, however, given the nature of the issues raised, which are of limited compass, involving established legal principle and simply making an assessment of how those principles apply to the facts, I do not consider it appropriate to make allowance on this application for costs on the basis that two counsel should appear. In my view one competent junior counsel would be more than enough.
As is well-established, it is appropriate to take a broadbrush to assessment of costs that should be allowed on a security for costs application. Having reviewed the costs estimate provided by Mr Taylor, I am of the view that an appropriate allowance for security for costs is $30,000.
I note that in the respondent’s notice of motion an order was sought that the summons be dismissed as incompetent in circumstances where the ground concerns an interlocutory decision of the District Court and the application has not sought leave to appeal pursuant to s 127 of the District Court Act 1973 (NSW). As was discussed in the course of argument, this matter is not an appeal but an application for judicial review. Section 127 of the District Court Act does not thus, in terms, apply.
Whether or not an appeal should have been brought is a matter that could conceivably be relevant to whether this Court should grant any relief in its discretion on the judicial review application: see Fong bhnf Fong v Weller [2024] NSWCA 46 at [26]-[30]. However, any such arguments would be ones for consideration on the hearing of the judicial review application. Counsel appearing for the respondent accepted that that was so and in consequence did not press prayer 4 of his notice of motion.
Counsel for the respondent indicated that there had been some suggestion that the applicant might seek to file an amended summons seeking judicial review, and said that the applicant had not filed the folder of documents required by r 51.45 of the Uniform Civil Procedure Rules 2005 (NSW). The respondent did not object to orders being made providing for these steps to be taken, noting that the proceedings will be stayed until the security for costs has been paid.
The orders of the Court will be as follows:
The applicant’s motion filed on 26 Feb 2025 seeking a stay of the orders of the District Court made on 19 November 2024 is dismissed with costs.
The applicant is to provide within 15 days security in the sum of $30,000 for the respondent’s costs by payment of that amount into Court.
The application for judicial review is stayed until security is provided in accordance with order 2 or as otherwise ordered by the Court.
The respondent’s notice of motion of 11 March 2025 is otherwise dismissed.
The applicant is to pay the respondent’s costs of the respondent’s motion of 11 March 2025.
The applicant is to file any amended summons seeking judicial review by 17 April 2025.
Time for compliance by the applicant with r 51.45 of the Uniform Civil Procedure Rules 2005 (NSW) is extended to 17 April 2025.
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ACN 627 087 030 Pty Limited
Poche [2025] NSWCA 66
(1985) 2 NSWLR 685
(2002) 55 NSWLR 737