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[1998] FCA 1701
Federal Court of Australia
1998-12-10
Hood J, Emmett J
Original judgment source is linked above.
EX TEMPORE REASONS FOR JUDGMENT HIS HONOUR: For reasons which I gave on 8 September 1998, I dismissed an application brought against the Attorney-General of the Commonwealth and the Director of Public Prosecutions by Robert Anthony Bou-Simon ("the Appellant"). The Appellant has now filed notice of appeal from the orders which I made. The respondents to the appeal have applied for orders that the Appellant provide security for the costs of the appeal. The applications for security came before me as duty judge. However, none of the parties had any objection to my dealing with the applications notwithstanding that I dealt with the matter at first instance. Under Order 52 rule 20: Unless the Court or a Judge otherwise directs no security for costs of an appeal to the Court shall be required. The appellant is presently resident in France as appears from the findings which I made in my reasons of 8 September. The applications for security are based on the fact that the appellant is resident outside Australia and, so far as inquiries have indicated, has no assets in Australia. I have evidence before me that searches have been conducted of the real property indexes for New South Wales and of registers of securities. Those searches have indicated that the Appellant owns neither real property in New South Wales nor shares in any company. The Appellant has filed no evidence to indicate to the contrary. Accordingly, I consider that I am entitled to draw the inference that the Appellant has no assets in Australia and it is clear that he is resident outside Australia. Some reliance was placed on Order 28 rule 3(1)(a) which provides as follows: (1) Where, in any proceeding, it appears to the Court on the application of the respondent - (a) that an applicant is ordinarily resident outside Australia; the Court may order that applicant to give such security as the Court thinks fit for the costs of the respondent of and incidental to the proceeding. Order 28, however, is not exhaustive as to the powers of the Court and the Court has power under section 56 of the Federal Court of Australia Act 1976 (Cth) to order security in an appropriate case. The respondents rely on the general principle stated by Bowen LJ in Cowell v Taylor (1885) 31 Ch D 34, where his Lordship said (at 38): The general rule is that poverty is no bar to a litigant that, from time immemorial, has been the rule at common law, and also, I believe, in equity. There is an exception in the case of appeals, but there the appellant has had the benefit of a decision of one of Her Majesty's Courts, and so an insolvent party is not excluded from the Courts, but only prevented, if he cannot find security, from dragging his opponent from one Court to another. The same principle was applied by Hood J in the Supreme Court of Victoria in Bethune v Porteous (1892) 18 VLR 493, where his Honour said (at 494): The rule requiring security from a plaintiff being a foreigner resident abroad, is based on the ground that if a verdict be given against him, he is not within the reach of our law so as to have process served upon him for the costs… But that does not appear to me to be the foundation of the rule requiring costs from an appellant, because it is clear that he may be ordered to give security even when within the reach of our process. In my opinion the reason underlying the numerous and varying cases in which appellants have been ordered to give security will be found in the injustice to a successful litigant that may be caused if he be compelled to contest the matter for a second time without a probability of obtaining his costs if ultimately successful. No general rule can be laid down, as each case has to depend upon its own "special circumstances", but the foregoing principle has been frequently recognised as applying to appeals. In P.S. Chellaram & Co v China Ocean Shipping Co (1991) 65 ALJR 642, McHugh J, when dealing with an application for security for costs, said (at 643): To make or refuse to make an order for security for costs involves the exercise of a discretionary judgment. That means that the court exercising the discretion must weigh all the circumstances of the case. The weight to be given to any circumstance depends not only upon its own intrinsic persuasiveness but upon the impact of the other circumstances which have to be weighed. A circumstance which may have very great weight when only two or three circumstances have to be weighed may be of minor significance when many circumstances have to be weighed. However, for over 200 years, the fact that a party, bringing proceedings, is resident out of the jurisdiction and has no assets within the jurisdiction has been seen as a circumstance of great weight in determining whether an order for security for costs should be made. Indeed, for many years the practice has been to order such a party to provide security for costs unless that party can point to other circumstances which overcome the weight of the circumstance that that person is resident out of and has no assets within the jurisdiction. The rationale for ordering a party resident out of the jurisdiction to provide costs is the difficulty that would be experienced otherwise in enforcing an order for costs if one were made. I am satisfied that I have a discretion, one way or the other, to order the Appellant to provide security for costs in the circumstances of the present case. The historical basis for requiring a foreign plaintiff to give security for costs was that, in order to enforce a judgment, a defendant had to sue on the judgment in the foreign country where the foreign plaintiff resided and, having obtained a judgment in the foreign country, the defendant had to enforce that judgment (see Morling J in Barton v Minister for Foreign Affairs (1984) 2 FCR 463 at 469). Prima facie, a case has been made out for the provision of security in the circumstances of the present case. I would not regard the appeal as frivolous. However, having regard to the fact that I decided the matter at first instance, it is hardly appropriate that I express any view about the prospects of success other than to say that I accept that the appeal is not frivolous. Two matters have been advanced on behalf of the Appellant in resisting the orders sought in the notices of motion. The first is that it is inappropriate to compel a party to provide security for costs in circumstances where that party is, in effect, moving by way of defence of his rights. It was put that the proceedings which were brought by the Appellant were in response to the application of the DPP for extradition of the Appellant from France. The original proceedings were prompted by the conduct of the DPP in relation to the extradition application. I found that there were some unsatisfactory aspects of the conduct of the DPP in relation to that application although, as I have indicated, I did not consider that there were grounds for interfering with the process in France. That is relied on by the Appellant as a basis for advancing the proposition that these proceedings are really defensive in character. In Willey v Synan (1935) 54 CLR 175, the plaintiff, a member of the crew of a ship which arrived in Australia from New Zealand, claimed ownership of some silver coins which he had found on the ship. Customs officers took possession of the coins. The plaintiff claimed the coins and the Collector of Customs then gave notice under section 207 of the Customs Act 1901 (Cth) requiring the plaintiff to commence an action for their recovery. The effect of the Customs Act was that if such an action was not commenced within a particular period of time the goods would be deemed to be condemned without any further proceedings. The plaintiff issued a writ in the High Court against the Collector of Customs claiming return of the coins and damages for their detention. The defendant then sought an order for security for costs on the ground that the plaintiff was ordinarily resident outside Australia. Although a judge at first instance made the orders sought, the Full High Court upheld the plaintiff's appeal and concluded that the nature of the proceedings was such that the plaintiff was really a party attacked, not a party attacking, and therefore was substantially in the position of a defendant and should not be ordered to give security for costs. While such principles may well have been applicable to the application brought by the Appellant at first instance, I am not satisfied that they have any application when he has had his day in court and has had a reasoned judgment rejecting his application. He is now, in a separate proceeding, the moving party seeking the Full Court's intervention with the orders which were made at first instance rejecting his claim.
In those circumstances, I do not consider that the principles referred to by the High Court, and which were also referred to by Heerey J in Farmitalia Carlo Erba SrL v Delta West Pty Ltd (1994) 28 IRP 336, have application. The second basis upon which the orders sought were resisted concerns the quantification of security. Under the Foreign Judgments Act 1991 (Cth), provision is made for reciprocity of enforcement of judgments between Australia and other countries. Under section 5(1), if the Governor-General is satisfied that substantial reciprocity of treatment will be assured in relation to the enforcement in a country of money judgments given in all Australian superior courts, the regulations may provide that Part 2 of that Act extends in relation to that country. The regulations do provide for the extension to certain courts of France of Part 2 of that Act. While I have no evidence before me as to the law of France in that respect, I am prepared to conclude that those French courts accord substantial reciprocity to orders of Australian courts, including an order of the Federal Court for payment of costs. It was contended on behalf of the appellant that in those circumstances any security should be limited to the costs of registering a judgment in the appropriate court in France. In Barton's Case, to which I have already referred, Morling J observed that the historical basis for requiring a foreign plaintiff to give security would not be applicable where the successful party was able to enforce a judgment for costs in the United Kingdom by virtue of the provisions of the Foreign Judgments Reciprocal Enforcement Act 1933 (UK). His Honour concluded that the appropriate order for security was an amount which would be adequate to cover the costs of registration of the order under such provisions. His Honour, deciding the question in 1984, made what his Honour described as a "generous estimate" of $2,000 for such costs. His Honour also referred to an order which had then recently been made by Rath J of the Supreme Court of New South Wales relating to the enforcement of a judgment in New Zealand. In the present case the DPP relies on evidence estimating that the costs of the appeal will be not less than $9,500. An affidavit was filed on behalf of the DPP containing a reasonably detailed estimate of the time that would be involved for a solicitor in preparing the appeal and for counsel. There was no evidence from the Appellant and there was no objection to the affidavit or any cross-examination on the affidavit. The Attorney-General also relied on an affidavit in which an estimate was given of solicitors' costs in excess of $7,000 and counsel's fees in excess of $3,000 such that the deponent of the affidavit filed on behalf of the Attorney-General estimated that costs would exceed $10,000. Again, there was no objection to the affidavit and no cross-examination on it. In those circumstances, I am prepared to conclude that the costs of the two respondents would be at least $9,500 each. I do not know whether it would be possible for one order to be registered in France for the enforcement of orders in favour of each respondent. My assumption would be that if there are two separate orders in favour of different parties each would have to enforce the order separately. In circumstances where Morling J was prepared to estimate that the cost of registering a judgment in the United Kingdom in 1984 was $2,000 it may well be that the cost of registering a judgment in France in 1998 would be not all that much less than $10,000. In the circumstances, having regard to the lack of express evidence as to the costs of registering a judgment in France, I am inclined to conclude that the amounts involved are such that it is preferable simply to order security in Australia. Accordingly, in the circumstances, I consider that it would be appropriate to order the Appellant to provide security in the sum of $9,500 for each of the respondents to the appeal and that, if that security has not been provided within 28 days to the satisfaction of the Registrar, then the appeal should be stayed until such time as the security is provided. Another basis upon which the Appellant sought to resist the orders for security was the nature of the proceedings. As I have indicated, the Appellant sought orders from the Court in connection with the DPP's application, through the Attorney-General, for extradition of the Appellant from France to Sydney. It was said that, as a matter of discretion, the nature of the proceeding is such that there ought to be no order for security. As I understand the contention, it was that the proceeding relates to and affects the liberty of the Appellant and that there ought to be no order which would interfere with his ability to conduct proceedings where his liberty is at stake. One matter which I should mention in that context is that, if the appeal is unsuccessful, then it seems likely, on the evidence before me, that the Appellant will in fact be extradited to Australia. The evidence indicates that the French court has now ordered extradition and, subject to what might occur in any appellate process in France, there is no evidence before me to indicate that the extradition would not be carried out. In those circumstances, the Appellant may therefore find himself in Australia. Nevertheless, the Appellant will not be a resident of Australia and there is no suggestion that, if he is extradited to Australia, he will bring assets with him. Nor is there any indication that the order requiring the provision of security would be oppressive in any sense so far as the Appellant is concerned. I have no evidence at all as to the Appellant's financial means but it would have been open to him, had he had any basis for doing so, to adduce evidence to indicate that the making of orders as sought would in some way interfere with his ability to conduct the appeal. That may well have been a discretionary matter to be taken into account, having regard to the nature of the proceedings. I have considered those factors and, having regard to the absence of any evidence that the provision of security would be likely to be oppressive to the Appellant, I do no regard that as a matter which would dissuade me from making the orders which I propose. I think, in the circumstances, the appropriate order is that the Appellant pay the respondents' costs of the motion. I certify that this and the preceding six (6) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett.
Associate: Dated: 10 December 1998 Counsel for the Applicant: GA Seib
Solicitor for the First Respondent: Australian Government Solicitor
Counsel for the Second Respondent: D.J. Fagan SC
Solicitor for the Second Respondent: Director of Public Prosecutions (Cth)
Date of Hearing: 10 December 1998
Date of Judgment: 10 December 1998
(1991) 65 ALJR 642
(1984) 2 FCR 463
(1935) 54 CLR 175