consideration
10 As noted above, Asden accepts that this is a case in which security would be ordered. Even if that were not so, I am satisfied that I should exercise my discretion in favour of making an order for security.
11 Asden is in liquidation. The evidence before me is that as at August 2015 it held approximately $450 in a bank account; it holds no real property; its liabilities significantly outstrip its assets in value; and as at March 2014 the liquidator reported that the likelihood of a return to creditors was dependent on the success of future recovery actions. Asden is clearly impecunious.
12 The evidence is also that Mr George Nichols funded the proceeding before the primary judge and, it seems, continues to fund this appeal. In the proceeding before the primary judge, Mr Nichols provided a statement disclosing his net asset position and an undertaking to pay Messrs Dinoris and Combis' costs in the event that a costs order was made against Asden. I note that no such undertaking is before the Court in the appeal.
13 Subject to the issue of prospects of success of the appeal, none of the factors that are relevant to and might tend towards a refusal to make an order for security for costs are evident here. As to prospects of success, no evidence was tendered or submissions made on that issue and I would treat that factor as neutral.
14 That then leaves the issue of the quantum of security that should be ordered, the real issue between the parties. Messrs Dinoris and Combis seek security in the sum of $155,000. They rely on a report prepared by Mr Adam Bloom, a specialist costs consultant, who has calculated that amount.
15 Asden contends that the amount sought as security is too high. It relies on a report prepared by Mr Paul Garrett, who is also a specialist cost consultant. Mr Garrett's opinion is that the likely costs to be incurred by Messrs Dinoris and Combis in defending the appeal are approximately $51,000. In reaching that opinion Mr Garrett has had regard to Mr Bloom's report.
16 The principal areas of difference between Messrs Bloom and Garrett are:
(1) in relation to the amounts claimed. Mr Garrett is of the view that in many cases the amounts estimated by Mr Bloom for particular items are too high, and opines that the estimates include amounts for the preparation of the cross-appeal;
(2) whether senior counsel is required on the appeal. Mr Garrett is of the opinion that there is complexity in the cross appeal but not the appeal and that, for the purposes of the security for costs application, allowance should only be made for junior counsel; and
(3) the appropriate rate for senior counsel, if allowed. Mr Bloom includes senior counsel at $7,400 per day, while Mr Garrett says the appropriate rate for senior counsel is $6,400 per day.
17 I do not propose to, in effect, undertake a taxation of the amount sought by Messrs Dinoris and Combis for security. That is not the role of the Court. Rather, in determining quantum, the Court attempts to make an order which provides a substantial capacity to meet an order for costs should it be made. While Mr Bloom's report is well reasoned, in my opinion, a claim of $155,000 for security represents the high water mark for a one day appeal and in this case is excessive.
18 Mr Garrett's report also provides sound analysis of the appropriate amount to be ordered for security. However, the allocation of time to the appeal as opposed to the cross appeal seems to be arbitrary and, with respect to Mr Garrett, whether senior counsel is required for the appeal is a matter on which minds may differ.
19 Submissions made by counsel appearing for Messrs Dinoris and Combis, on the one hand, and senior counsel appearing for Asden, on the other, went to the issue of time to be allocated as between the appeal and the cross appeal. But at this stage it is not possible for the Court to ascertain how time might be allocated and, in any event, the matter has from the start been listed for one day. The hearing has not been extended by the filing of the cross appeal.
20 The issues are the allocation of time between the appeal and cross appeal and, more generally, whether the items included and calculation of the amount sought for security by Messrs Dinoris and Combis are too high; and whether security should be ordered in the amount sought. In my opinion, it should not. The appropriate amount for security is $80,000.
21 In coming to that view, I have had regard to the reports of Messrs Bloom and Garrett and have excluded or reduced the following amounts sought, which appear either excessive or unnecessary:
first, the amount sought for the security for costs application;
second, the amount sought for the item titled "Advice on Prospects on Appeal";
third, the attendance to research cases requested by counsel, which seems excessive and unnecessary in light of other attendances and where two counsel are briefed;
fourth, the amount sought for senior counsel to settle part C of the appeal book, and part of the amount sought for the solicitors' time in relation to that task;
fifth, the time for preparation for the hearing by the solicitors, given other attendances and the fact that senior and junior counsel are briefed;
sixth, preparation time for both senior and junior counsel;
seventh, the amount sought for skill and care; and
finally, the majority of costs described as "Past Costs", which in part go to the issue of the cross appeal.
22 I will make orders accordingly.
I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Markovic.