ADLU Pty Ltd v Ertech

"Upon the first defendant giving the undertaking not to proceed with its counterclaim if the plaintiff's claim is stayed because of the plaintiff's failure to provide security in accordance with the Court's order:

1. The plaintiff provide security for the first defendant's costs of defending the plaintiff's claim up until the first day of trial in the sum of $350,000 by way of payment of moneys into Court or in a form acceptable to the Registrar of the Supreme Court of Queensland.
2. The security be provided by 4pm on 18 December 2025, failing which the plaintiff's claim in the action is stayed until the security is provided.
3. The parties file and serve submissions on costs of not more than three pages by 4 pm on 9 December 2025.
4. The parties file and serve submissions on costs in reply of not more than two pages by 4 pm on 11 December 2025.
5. The issue of costs be dealt with on the papers."

• [2] Pursuant to the directions, the following documents were filed:

(a) On 10 December 2025, the first defendant's submissions on costs.[1]

(b) On 8 December 2025, the plaintiff's submissions on costs.[2]

(c) On 12 December, the first defendant's submissions in reply on costs.[3]

(d) On 11 December 2025, the plaintiff's responsive submissions to the first defendant's written submissions.[4]

(a) It is the successful party.

(b) The "usual rule" pursuant to r 681 of the Uniform Civil Procedure Rules 1999 (Qld) (UCPR) applies and the plaintiff should pay the first defendant's costs of the application for security for costs.

(c) There are no exceptional circumstances to warrant depriving the first defendant of its costs.

(d) The appropriate order is that the plaintiff pay the first defendant's costs of the application on the standard basis.

(a) Rule 681 of the UCPR does provide that costs generally follow the event, but the Court has a discretion to depart from that rule.

(b) A Court may depart from the "usual rule" in respect of an interlocutory application where the relevant factors include a "mixed" or "limited" success,[5] or there is conduct by the winning party that unnecessarily increased costs.

(c) Further, the Court may reserve costs to the trial judge.

(d) Rule 684 of the UCPR provides that the Court may make orders for specific parts of a case. In particular, in interlocutory disputes the Court may assess individual issues rather than treating the outcome as a simple win or loss.[6]

• [5] In respect of the particular circumstances which arise in this case, the plaintiff submits that:

(a) The first defendant did succeed in showing entitlement to security for costs. However, there was mixed success, such that the usual rule is inappropriate.

(b) The Court ordered an amount of security of $350,000, where the first defendant sought $847,936. Therefore, the first defendant had limited success.

(c) The application for security was not complex legally or factually.

(i) King's Counsel was unnecessary for the application and any order for costs should disallow or reduce the fees for King's Counsel.

(ii) Any duplication for multiple lawyers should be avoided.

• [6] In all of the circumstances, the plaintiff submits that the order should be costs of the application are costs in the proceeding. Alternatively, if the Court orders that the plaintiff pay the first defendant's costs on the standard basis, then the fees of King's Counsel should be excluded or reduced.
• [7] In Reply the first defendant submits:

(a) The first defendant was ultimately successful, and the Court should order that the plaintiff pay the first defendant's costs of the application.

(b) Whilst the quantum of the security ordered was less that the amount sought, the issue of quantum occupied a small aspect of the hearing. This does not justify a departure from the "usual rule".

(c) In respect of senior Counsel's fees, the first defendant submits that this is premature and the issue can be considered and determined when a costs assessor is appointed.

• [8] Rule 681 of the UCPR provides:

"(1) Costs of a proceeding, including an application in a proceeding, are in the discretion of the court but follow the event, unless the court orders otherwise.

(2) Subrule (1) applies unless these rules provide otherwise."

• [9] The Court has a wide discretion as to costs. However, the ordinary course is that the unsuccessful party will be ordered to pay the costs of the successful party.
• [10] Here, the first defendant was successful in obtaining an order that the plaintiff provide security for the first defendant's costs from 4 July 2025 to the first day of trial. Whilst there was some reduction in the quantum of the security ordered, neither party's position was adopted in full.
• [11] The Court does have power to make an order including or excluding the recoverability of Counsel's fees on an assessment. Usually there would be some evidence on the issue or a particular feature that was relied upon in respect of the issue. Here there is neither.
• [12] There was an unusual aspect of this application involving the delay in bringing the application for security for costs (in particular, where the parties had previously corresponded about the issue and no application was made at that stage) and the explanation for the change in position. Both the threshold question and the discretionary factors (including the delay and the explanation) had to be considered in detail before the issue of quantum arose for consideration.
• [13] In all of these circumstances, I am not satisfied that there is a basis to conclude that it was unreasonable to involve senior counsel in respect of the written submissions and the hearing of the application.
• [14] Considering the various factors relevant to the exercise of the Court's discretion as to costs:

(a) The "usual rule" is that costs follow the event, and the relevant event is the order that security for costs be provided.

(b) The plaintiff contended that no security should be ordered. To that extent the plaintiff was completely unsuccessful.

(c) The Court accepted the evidence of Mr Speechly in respect of the tasks and general approach to the estimate of recoverable costs in respect of the plaintiff's claim and excluding the first defendant's counterclaim.

(d) The Court in effect found a "middle ground" in respect of the allocation of costs between the claim and the counterclaim.

• [15] In all of the circumstances, I am not satisfied that there is a sufficient basis to depart from the "usual rule" where the first defendant has been completely successful in obtaining an order for security for costs and largely successful on the quantum of the order.
• [16] Accordingly, it is appropriate to order that the plaintiff pay the first defendant's costs of the application on the standard basis.

[1] First Defendant's Written Submissions on Costs dated 9 December 2025, CFI #200.

[2] Respondent Applicant's Submissions on Costs dated 8 December 2025, CFI #199.

[3] First Defendant's Written Submissions on Costs in Reply dated 11 December 2025, CFI #203.

[4] Plaintiff's Responsive Submissions to the First Defendant's Written Submissions on Costs dated 11 December 2025, CFI #202.

[5] Day v Humphries [2018] QCA 321 at [8] - [11].

[6] Day v Humphries [2018] QCA 321 at [9] - [11].