//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2026] NSWCA 110
respondent. The applicant was granted an extension of time to apply for leave to appeal from Nixon J’s orders of 3 November 2025. The application for leave to appeal was dismissed with costs.
The Court of Appeal allowed Crown more time to seek permission to appeal the order deeming him served, but refused permission. It considered that the primary judge could rely on the email evidence when ordering substituted service. The proposed appeal raised a factual procedural dispute, did not show a reasonably clear injustice, and concerned costs orders totalling $59,000. The application was dismissed with costs.
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.
2,167 words · generated 07/10/2026
Thomas Peter Crown applied for leave to appeal orders made by Nixon J in proceedings brought by Arbitrium Credit Partners Pty Ltd. Arbitrium had sued four corporate trustees to set aside statutory demands they issued against it. Crown was the sole director and shareholder of those defendant companies. The Court of Appeal’s decision addressed two stages of the primary judge’s orders: first, an order deeming Crown served with Arbitrium’s interlocutory process; and second, orders determining costs and making Crown and the defendant companies jointly and severally liable.
3 cited instruments linked from this judgment.
The background to the statutory demands concerned fees paid in connection with a proposed refinancing. The borrowers were four companies that were distinct from the defendant custodian companies in the set-aside proceedings. The borrowers paid a $100,000 work fee under a non-binding term sheet, then paid the first $250,000 tranche of a fee under a binding term sheet. The refinancing did not proceed: [9]–[12]. Crown later personally demanded repayment of $360,000, and the defendant companies issued statutory demands against Arbitrium for $110,000 and $250,000: [14]–[16].
Arbitrium commenced proceedings to set aside those demands on 25 August 2025. The defendants later indicated they would no longer rely on the demands. They explained that an undertaking Crown had given in separate receivership proceedings restrained them from making representations necessary to prosecute the claims: [18]–[20]. Arbitrium nevertheless sought its costs.
On 3 November 2025, Nixon J made an order under r 10.14(3) of the Uniform Civil Procedure Rules 2005 (NSW) that Crown be taken to have been served with Arbitrium’s interlocutory process. The primary judge directed Crown to file any evidence and submissions in response by 17 November: [22]–[25]. Crown did not file material, and the primary judge proceeded on the basis that he did not seek to be heard in opposition: [26].
On 3 December 2025, the primary judge ordered indemnity costs for part of the relevant period, ordinary costs for the later period, and joint and several liability for the defendant companies and Crown. The costs were fixed at $59,000 including GST: [1], [27]–[31]. The Court of Appeal granted Crown an extension of time to apply for leave to appeal the 3 November order, but dismissed the application for leave with costs: [4], [46].
The Court began with the leave threshold. It stated that leave is granted only if the proposed appeal raises an issue of principle or public importance, or an injustice that is reasonably clear and goes beyond what is merely arguable: [3]. It added that the Court exercises particular caution when an appeal concerns an interlocutory decision on practice and procedure: [3].
Crown’s first proposed ground challenged the order deeming service. His other grounds, alleging procedural unfairness and error in making a third-party costs order, depended on his succeeding on the service challenge: [5]. The Court therefore focused on whether the service order provided a sufficient basis for leave.
Crown argued that the evidence supporting the order was deficient. The points included the lack of personal service, alleged inadequacies in the affidavit evidence, the status of the two email addresses, the absence of a read receipt for the Coronam address for the 31 October email, and the assertion that material had not been provided to the primary judge: [33]. Crown also filed affidavits disputing receipt and explaining that he was away from his residence when a physical copy was said to have been left there: [34], [37].
The Court’s assessment was that the primary judge had evidence of email exchanges between Crown and Arbitrium’s solicitor about the dispute. The solicitor’s affidavit described prior correspondence using the Coronam email address, efforts to determine whether the defendants’ solicitor could accept service for Crown, and emails sent to Crown before the hearing: [40]. The evidence included a read receipt for the 31 October email attaching the interlocutory process, sent to the Resilient address: [40(7)].
The Court acknowledged that there was no read receipt for the 31 October email sent to the Coronam address. It nevertheless considered that the evidence that Crown regularly used that address, including in communications with Arbitrium’s solicitor, was capable of supporting the primary judge’s decision. Taken together with the read receipt for the Resilient email, that evidence made it open to the primary judge to order substituted service: [42]. The Court’s conclusion was about what the evidence permitted the primary judge to decide in the exercise of the rule’s discretion. It did not determine every factual disagreement raised in Crown’s later evidence as a separate factual finding.
The Court then considered the character and practical significance of the proposed appeal. It described the challenge as essentially a factual dispute about practice and procedure. The final orders concerned costs alone, totalling $59,000: [43]. The Court referred to the interest in finality where small sums are at stake and to the significance of appeal costs that may be disproportionate to the amount in dispute: [43]. These considerations reinforced its conclusion that leave was not warranted: [7], [43]–[44].
The Court also rejected Crown’s submission that there should be no costs order because the application raised bona fide issues of procedural fairness and discretionary error. It found that this did not justify departing from the usual rule that costs follow the event: [45]. The formal orders granted the extension of time but dismissed the leave application with costs: [46].
The judgment presents the relevant leave principles as established, rather than announcing a new test. At [3], the Court cited Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company for the requirement that an appeal raise an issue of principle or public importance, or a reasonably clear injustice going beyond what is merely arguable. It also referred to In re the Will of F. B. Gilbert and Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc for particular caution in appeals from interlocutory decisions on practice and procedure.
The decision applies those principles to an order made under UCPR r 10.14(3). The Court’s stated conclusion was that the primary judge could rely on the evidence of prior email exchanges and the read receipt when making the substituted-service order: [42]. It did not purport to set out a comprehensive test for every application under r 10.14(3), nor did it decide that any particular email evidence will invariably be sufficient.
The costs aspect is similarly framed as an application of existing considerations. The Court relied on the character of the orders as costs-only orders, their total amount, and the factual and procedural nature of the proposed dispute: [7], [43]. At [43], it referred to The trustee for Dawson Street Unit Trust trading as Dawson Street Auto Centre Pty Ltd v 4Cyte Pathology Pty Ltd and the cases discussed there in relation to finality and proportionality.
The judgment does not identify a change in the law before or after this decision. On the text provided, its significance lies in applying the existing leave threshold to a challenge involving email-based substituted service and relatively modest costs orders. Any claim about how later courts have treated the decision cannot be established from this judgment alone.
At [3], the Court stated: “leave to appeal will only be granted if the proposed appeal raises an issue of principle or question of public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable.” In plain English, a proposed appeal must show more than a point that could be debated. It must meet one of the stated categories, and an alleged injustice must be reasonably clear.
Also at [3], the Court said it exercises “particular caution” when considering leave from an interlocutory decision on practice and procedure. That reflects the limited and procedural nature of the decision under challenge. It is not a rule that such appeals can never proceed; it describes the caution relevant to the Court’s assessment.
At [42], the Court concluded that it “was open to the primary judge” to rely on evidence of email exchanges and the read receipt to make the substituted-service order. The phrase “was open to” is important: the Court concluded that the evidence could support the primary judge’s exercise of discretion. The judgment does not state that the evidence compelled that result in every case.
At [43], the Court described the appeal as raising “essentially a factual dispute on a matter of practice and procedure”, with costs alone and $59,000 at stake. In plain English, the Court regarded the proposed challenge as fact-specific and procedural, rather than as raising a broader legal issue. The amount and nature of the final orders also mattered to whether leave should be granted.
Finally, at [45], the Court said the applicant’s reasons for seeking no costs order did not justify departing from “the usual rule that costs follow the event.” In this proceeding, the unsuccessful leave application was dismissed with costs: [46].
This decision is most directly relevant to an application for leave to appeal from an interlocutory order about service where the proposed appeal turns on disputed facts and the applicant says there was no effective notice. The decision shows that the Court considered evidence of prior email communications, use of an email address, and a read receipt when assessing whether a primary judge could order substituted service under UCPR r 10.14(3): [40]–[42].
It is also relevant where later proposed grounds depend on overturning the service order. Here, Crown’s procedural-fairness and third-party-costs grounds were dependent on the first ground challenging service: [5]. The Court’s rejection of the service-based basis for leave therefore affected the application as a whole.
The judgment may also be relevant where the proposed appeal concerns costs alone and the amount is relatively limited. The Court treated the total of $59,000, the factual and procedural character of the dispute, and the interest in finality as factors against leave: [7], [43]. It cited authorities concerning the significance of disproportionate appeal costs, but did not formulate a fixed monetary threshold for leave.
The decision should not be read as deciding that sending documents by email always constitutes service, that a read receipt always proves a person read the relevant material, or that disputed non-receipt can never justify leave. Its conclusion was tied to the evidence and procedural setting described in the judgment: [40]–[42].
The judgment itself does not identify any later judicial treatment of Crown v Arbitrium Credit Partners Pty Ltd. Its decision date is 15 June 2026, and the text provides no subsequent cases applying, distinguishing, or reconsidering it. It would therefore be unsupported to describe a later line of treatment based only on this source.
The Court did refer to earlier authorities. It cited Cheng for the threshold for leave and for discussion of finality and proportionality, and it cited In re the Will of F. B. Gilbert and Adam P Brown Male Fashions in support of caution for interlocutory practice-and-procedure appeals: [3]. At [43], it referred to Dawson Street and, through that discussion, to Gurr, Be Financial, and Burrows concerning finality and disproportionate appeal costs. Those are authorities the Court relied on or referred to in this decision, not examples of later treatment of Crown.
The judgment does not set out a general account of what evidence will be sufficient for an order under UCPR r 10.14(3). It records the requirements of r 10.14(3A) as argued by Crown, including affidavit statements about knowledge of the person’s whereabouts and communications since the cause of action arose: [38]. The Court’s reasons focus on whether the evidence in this case was capable of supporting the exercise of discretion. The text does not provide a detailed ruling on every aspect of the asserted r 10.14(3A) deficiencies.
The Court also does not resolve, as a general evidentiary question, the reliability or meaning of different kinds of email read receipts. Crown disputed whether the receipts were what he described as a “true” Message Disposition Notification and said they could reflect an automated process without human involvement: [36]–[37]. The Court’s operative reasoning was that the evidence before the primary judge, considered with the prior email exchanges and the read receipt, made the order open to that judge: [42]. It did not announce a general rule about the evidentiary weight of read receipts.
Nor does the judgment establish a universal monetary boundary for appeals concerning costs. It treats the $59,000 total, the nature of the dispute, and the potential proportionality of further litigation as relevant considerations: [7], [43]. The cited authorities are invoked for general finality and proportionality considerations, not to create an automatic rule that leave must be refused whenever a particular amount is in dispute.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on or relying on this analysis, have it checked by a qualified Australian lawyer.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Crown v Arbitrium Credit Partners Pty Ltd [2026] NSWCA 110
Hearing dates: 9 June 2026
Date of orders: 15 June 2026
Decision date: 15 June 2026
Before: Payne JA; Mitchelmore JA
Decision: (1) Grant the applicant an extension of time to apply for leave to appeal from the orders of Nixon J made on 3 November 2025.
(2) Dismiss the application for leave to appeal with costs.
Catchwords: APPEALS — leave to appeal — principles governing — whether reasonably clear injustice rising above merely arguable — where dispute is a factual matter of practice and procedure — where orders of primary judge were as to costs only
COSTS — party/party — court’s discretion — where primary judge made interlocutory order that the applicant was taken to have been served with interlocutory process — whether preconditions for exercise of discretion by primary judge were satisfied
Legislation Cited: Supreme Court Act 1970 (NSW), s 101
Uniform Civil Procedure Rules 2005 (NSW), r 10.14
Cases Cited: Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39
Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company (2022) 108 NSWLR 342; [2022] NSWCA 118
In re the Will of F. B. Gilbert (dec) (1946) 46 SR (NSW) 318
The trustee for Dawson Street Unit Trust trading as Dawson Street Auto Centre Pty Ltd v 4Cyte Pathology Pty Ltd [2026] NSWCA 78
Texts Cited: Nil
Category: Principal judgment
Parties: Thomas Peter Crown (applicant)
Arbitrium Credit Partners Pty Ltd (first respondent)
Evandale Custodian Pty Ltd as trustee for the Evandale Property Trust (second respondent)
Mereworth Custodian Pty Ltd as trustee for the Mereworth Property Trust (third respondent)
Leets Vale Custodian Pty Ltd as trustee for the Leets Vale Property Trust (fourth respondent)
Panawanica Custodian Pty Ltd as trustee for the Panawanica Property Trust (fifth respondent)
Representation: Counsel:
J Forbes (first respondent)
Solicitors:
Gadens as agent for Harrison Partners & Company (first respondent)
File Number(s): 2025/00504785
Publication restriction: Nil
THE COURT**:** The applicant, Thomas Peter Crown, seeks leave to appeal from the following orders:
an order made by Nixon J on 3 November 2025, pursuant to r 10.14(3) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), that the applicant was taken to have been served with copies of the interlocutory process by which the first respondent, Arbitrium Credit Partners Pty Ltd (Arbitrium), sought its costs of proceedings it brought to set aside statutory demands served by the company trustees of four property trusts (the defendants), of which the applicant was the sole director and shareholder; and
orders made by Nixon J on 3 December 2025 that: (i) Arbitrium’s costs in the proceedings were payable on an indemnity basis up until 20 September 2025 and thereafter on an ordinary basis; (ii) the defendants and the applicant were jointly and severally liable for those costs; and (iii) the costs were fixed in the sum of $59,000 (including GST).
The applicant requires leave to appeal from each of the orders the subject of challenge. The primary judge’s order of 3 November 2025 was interlocutory and involved a matter of practice and procedure: Supreme Court Act 1970 (NSW), s 101(2)(e). His Honour’s orders of 3 December 2025 were as to costs only (Supreme Court Act, s 101(2)(c)), and in an amount that falls below the monetary threshold: Supreme Court Act, s 101(2)(r).
It is well settled that leave to appeal will only be granted if the proposed appeal raises an issue of principle or question of public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable: see eg Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company (2022) 108 NSWLR 342; [2022] NSWCA 118 (“Cheng”) at [15] (Bell CJ, Ward P and Basten AJA agreeing). This Court exercises particular caution in granting leave to appeal from an interlocutory decision on a matter of practice and procedure: In re the Will of F*.* B*.* Gilbert (dec) (1946) 46 SR (NSW) 318; Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 at 177; [1981] HCA 39 (Gibbs CJ, Aickin, Wilson and Brennan JJ).
By notice of motion filed 13 May 2026, the applicant sought leave to file and serve an amended summons and an amended draft notice of appeal. Arbitrium did not oppose leave for the applicant to rely on those amended documents. Arbitrium also did not oppose the extension of time required for the applicant to seek leave to appeal from the order of the primary judge made on 3 November 2025, which will be granted.
The draft notice of appeal contains three proposed grounds of appeal. Proposed ground 1 challenges the primary judge’s order, made pursuant to UCPR r 10.14(3), in circumstances where it was alleged that the preconditions for the exercise of that power were not satisfied and the evidence was incapable of supporting a finding of effective or deemed service. The issue that the applicant raises in proposed ground 2, that the making of the third-party costs order involved a denial of procedural fairness, depends on the applicant succeeding on ground 1. That is also the case for proposed ground 3, with the applicant contending that the primary judge erroneously made the order for third-party costs in the absence of evidence from him and otherwise on untested and incomplete evidence which was insufficient to justify piercing the corporate veil between him and the defendants, or attributing the defendants’ conduct to him.
It is sufficient for the purposes of the application for leave to appeal to detail the background by reference to the reasons of the primary judge: In the matter of Arbitrium Credit Partners Pty Lt**d [2025] NSWSC 1457.
Arbitrium is a specialist funds manager: at [9]. In late 2013, the applicant approached Arbitrium with a view to refinancing a $65m facility, provided by MC Coronam Pty Ltd (Merricks) to four entities controlled by the applicant (the borrowers): at [10], [62]. As the primary judge emphasised, the borrowers were not the same entities as the defendants in the proceedings before his Honour, the differences between which his Honour demonstrated in the following table (at [11]):
| Borrowers | Defendants | | Evandale Property Pty Ltd (ACN 654 842 207) in its personal capacity and as trustee of the Evandale Property Trust | Evandale Custodian Pty Ltd (ACN 688 212 946) as trustee of the Evandale Property Trust | | Leets Vale Property Pty Ltd (ACN 654 842 378) in its personal capacity and as trustee of the Leets Vale Property Trust | Leets Vale Custodian Pty Ltd (ACN 688 214 486) as trustee for the Leets Vale Property Trust | | Mereworth Property Pty Ltd (ACN 654 841 871) in its personal capacity and as trustee of the Mereworth Property Trust | Mereworth Custodian Pty Ltd (ACN 688 203 634) as trustee for the Mereworth Property Trust | | Panawanica Property Pty Ltd (ACN 654 842 832) in its personal capacity and as trustee of the Panawanica Property Trust | Panawanica Custodian Pty Ltd (ACN 688 216 613) as trustee for the Panawanica Property Trust. |
On 26 January 2024, the borrowers executed a non-binding term sheet, which provided for a “work fee” of $100,000 (plus GST) which was payable by the borrowers on execution of the term sheet: at [12]. This amount was paid on 28 January 2024: at [13].
On 30 April 2024, the borrowers executed a binding term sheet, which provided for a term sheet fee of $500,000 (plus GST) which was payable by the borrowers in two equal tranches of $250,000 (plus GST). The first tranche was payable upon entry into the binding term sheet, and the second was payable upon financial close of the transaction: at [13]-[15]. The binding term sheet, to which the applicant was not a party, provided that the term sheet fee was refundable in the event of a “mutual cancellation”: at [14], [16].
The first tranche of the term sheet fee was paid on 14 May 2024: at [17]. However, the financing transaction in respect of the Merricks facility did not proceed: at [18].
On 26 March 2025, Merricks appointed receivers and managers to each of the borrowers pursuant to a security arrangement that had been entered into at the same time as the Merricks facility agreement. The primary judge noted in his Honour’s reasons that there were ongoing proceedings in the Supreme Court between the applicant and the receivers (receivership proceedings): at [19].
On 19 June 2025, the applicant caused each of the defendants to be incorporated, of which he was the sole shareholder and director: at [20]. By letter to Arbitrium, dated 4 July 2025, the applicant personally demanded repayment of $360,000, comprising the $110,000 work fee under the non-binding term sheet, as well as the $250,000 first tranche payment under the binding term sheet. The applicant stated that, should payment not be received within seven days, he would, inter alia, initiate legal proceedings for recovery and damages: at [21].
Arbitrium’s solicitor, Mr Harrison, responded to the applicant on 11 July 2025, stating that the work fee “was freely accepted as payable” and “expressly stated to be non-refundable”, and that the first tranche of the term sheet fee was refundable only “in the event of the mutual cancellation by the parties”, which had not occurred: at [23]. The applicant replied on 17 July 2025, repeating his demand for the payment by 25 July 2025 and indicating that, if the sum was not paid, he intended to initiate proceedings: at [24].
On 6 August 2025, the applicant caused the defendants (not the borrowers) to issue two statutory demands in the amounts of $110,000 and $250,000: at [25]. The covering letter to the demands was signed by the applicant: at [26].
On 7 August 2025, Mr Harrison wrote to the applicant in relation to the statutory demands, stating that they were “formally defective and substantively inappropriate”, and that pursuit of the claims “via the statutory demand process” was “abusive”: at [29]. By further correspondence dated 12 August 2025, in the absence of a response from the applicant to the 7 August letter, Mr Harrison stated that if the statutory demands were not withdrawn by the following day, Arbitrium would take steps to set them aside and would “seek indemnity costs”: at [31].
“Given that the 29 September Orders did not make any provision for the filing of any evidence or submissions by Mr Crown, I listed the matter for directions on 3 November 2025. At that listing, the Plaintiff made an application, pursuant to r 10.14(3) of the [UCPR], for an order that Mr Crown be taken to have been served, as at 31 October 2025, with copies of the Interlocutory Process, the supporting affidavit of Mr David William Harrison affirmed 9 October 2025 with its accompanying exhibit, and the Plaintiff’s written submissions, by way of personal service and by sending those documents to a known email address of Mr Crown. I made an order to that effect, and directed Mr Crown to file any evidence and submissions in response to the Interlocutory Process by 5pm on 17 November 2025.”
A transcript of the directions hearing before the primary judge on 3 November 2025 was included in the White Folder on the application for leave to appeal. During that directions hearing, in support of the order made under UCPR r 10.14(3), Arbitrium’s counsel read an affidavit of his instructing solicitor, Mr Harrison, dated 2 November 2025, the exhibit to which included evidence of his having sent the interlocutory process to two email addresses for the applicant. Mr Harrison deposed that he had used one of those email addresses in email exchanges with the applicant before the statutory demands were issued and proceedings were commenced, as well as after filing the interlocutory process: “pc@coronam.com.au” (the Coronam email). Mr Harrison deposed that the applicant had provided the other email address, “p.crown@resilient.net.au” (the Resilient email), for the purposes of the term sheets, pursuant to which the statutory demands were made.
At the hearing before Nixon J on 3 November 2025, counsel for Arbitrium also noted that the documents had been left at an address of the applicant. However, he accepted before his Honour that the documents had not been personally served by that method.
On that occasion, his Honour made an order that the interlocutory process was taken to have been served on the applicant on or before 31 October 2025. By that order, his Honour directed the applicant to file any evidence and submissions in response to the interlocutory process by 17 November 2025: at [7]. The primary judge also directed that the applicant be informed that day of the orders made, at the two email addresses which counsel for Arbitrium had drawn his Honour’s attention to.
In the judgment, the primary judge noted that the applicant did not file any material. Accordingly, his Honour proceeded to determine the application on the basis that the applicant did not seek to be heard in opposition to the orders sought: at [8].
In concluding that indemnity costs were justified, his Honour relied primarily upon Mr Crown’s undertaking: at [46]. His Honour stated that, whatever the applicant’s state of mind at an earlier point in time, “it must have been apparent to him, from the time when Mr Crown’s Undertaking was given, that the Defendants would not be able to maintain the Statutory Demands, which had apparently been issued on the basis that the Defendants had replaced the Borrowers as the trustees of the Property Trusts”: at [47]. His Honour stated that it must also have been apparent to the applicant that if the borrowers had any right to seek repayment of the money in issue, only the receivers could enforce those rights: at [47].
His Honour found that, on giving the undertaking in the receivership proceedings, the applicant should have immediately taken steps to cause the defendants to withdraw the statutory demands: at [49]. The conduct of the defendants and the applicant in maintaining the statutory demands thereafter was unreasonable: at [50]. His Honour concluded that Arbitrium was entitled to its costs from 14 August 2025 (the date of Mr Crown’s undertaking) to 20 September 2025 (inclusive) (the date that the demands were formally withdrawn) on an indemnity basis. His Honour also awarded costs from 21 September 2025 (being the costs of the interlocutory process) on an ordinary basis: at [50]-[54].
As noted at the outset of these reasons, the complaint in proposed ground of appeal 1 about the primary judge’s order pursuant to r 10.14 of the UCPR was central to both of the other proposed grounds in respect of which the applicant sought leave to appeal. Both the applicant’s written submissions, dated 13 May 2026 and 5 June 2026, and his oral submissions at the hearing, focused on the making of this order and what the applicant contended was the insufficiency of the evidence on which it was made.
The particulars to proposed ground of appeal 1 raise the following issues:
The application was made ex parte on 3 November 2025, relying on the affidavit of Mr Harrison of 2 November 2025 that was not filed with the Court and was not served upon the applicant either before or after the order was made. The applicant contended that he did not receive a copy of this affidavit until it was annexed to Arbitrium’s response to his application for leave to appeal filed 30 March 2026 (particular (a)).
Mr Harrison’s affidavit did not address Arbitrium’s knowledge of the applicant’s whereabouts, contrary to the requirement in UCPR r 10.14(3A)(a), nor did it include a sufficient statement of communications between the applicant and Arbitrium since the proceedings arose, contrary to the requirement in UCPR r 10.14(3A)(b) (particulars (b) and (c)).
The steps said to constitute service were limited to two avenues. The first was leaving the documents on the ground inside the closed remote-access gates of the applicant’s residence, which counsel for Arbitrium accepted was not personal service in the hearing before the primary judge on 3 November 2025. The second was email transmission on 31 October 2025 to the Coronam email and the Resilient email, in circumstances where the Coronam email had been used for previous correspondence but a read receipt was only exhibited for the Resilient email (particulars (d) and (e)).
Arbitrium did not produce Exhibit DWH-1 to the primary judge at the hearing on 3 November 2025, and yet his Honour made an order directing that it be taken to have been served on or before 31 October 2025 (particular (f)) in circumstances where his Honour’s chambers had recorded, in an email of 29 October 2025, that there was currently no evidence before the Court that the applicant had been served with the interlocutory process (particular (g)).
In his affidavit of 13 May 2026, the applicant addressed matters relating to his alleged non-receipt of the interlocutory process. He included a chronology of his email addresses (at [8]-[11]) and deposed that he did not receive the emails that Mr Harrison sent in relation to the interlocutory process (at [16]-[19]). He also deposed that he was absent from his residence on holidays in the period when a physical copy of the interlocutory process was said to have been left there (at [12]-[15]).
“…There is a special interest in finality when small sums are at stake: Gurr v Robinson [(Court of Appeal (NSW), Kirby P, Hope and Samuels JJA, 10 February 1986, unreported)], quoted in Cheng at [16]. When the likely costs of the appeal (and any further litigation that might be necessary as a result of the appeal) are disproportionate to the amount in dispute, that will be a factor weighing heavily against a grant of leave: see Be Financial [Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164] at [39]. Litigation where the costs are likely to exceed the amount in issue is a poor candidate for a grant of leave: Burrows v Macpherson & Kelley Lawyers (Sydney) Pty Ltd [2021] NSWCA 148 at [44] per Leeming JA, quoted with approval in Cheng at [20].”
The applicant has not demonstrated that the present case warrants a grant of leave to appeal. The application will be dismissed.
The respondent sought its costs in the event that leave to appeal was refused. The applicant submitted that there should be no order as to costs given that his application raised bona fide questions of procedural fairness and discretionary error, and that the costs of the motion be reserved. That submission does not constitute a reason for the Court to depart from the usual rule that costs follow the event.
The Court makes the following orders:
Grant the applicant an extension of time to apply for leave to appeal from the orders of Nixon J made on 3 November 2025.
Dismiss the application for leave to appeal with costs.
**********
Crown
Arbitrium Credit Partners Pty Ltd
[2026] NSWCA 78
(1981) 148 CLR 170
(2022) 108 NSWLR 342
The applicant was granted an extension of time to apply for leave to appeal from Nixon J’s orders of 3 November 2025. The application for leave to appeal was dismissed with costs.
In support of his application for leave to appeal, the applicant also sought leave to rely on fresh evidence, comprising two affidavits respectively affirmed by him on 13 May 2026 and 5 June 2026. In response to the applicant’s 13 May 2026 affidavit, Arbitrium read an affidavit of its solicitor, David William Harrison, affirmed 2 June 2026. During the hearing, the parties were permitted to read the additional evidence, with limited parts of the applicant’s affidavits treated as submissions.
As noted above, in order to succeed on the notice of appeal, the applicant would need to establish that the primary judge erred in making the order pursuant to UCPR r 10.14(3). The applicant’s challenge to that order, which is procedural in nature, does not raise a question of principle or general importance. Nor was his Honour’s making of the order, in the exercise of the discretion conferred by the rule, attended by a reasonably clear injustice. The nature of the final orders that his Honour made which are the subject of the application for leave to appeal, being orders only as to costs, in an amount totalling $59,000, also tells against a grant of leave. It follows that the application for leave to appeal will be dismissed.
On 14 August 2025, in the receivership proceedings, the applicant gave an undertaking, relevantly, that he would not make representations that the borrowers had been removed as trustees of the four separate property trusts (Mr Crown’s undertaking).
On 25 August 2025, Arbitrium commenced proceedings against the defendants to set aside the statutory demands: at [33]. On 8 September 2025, the defendants’ former solicitor indicated to Mr Harrison by email that “his clients will no longer rely on the Statutory Demands” and proposed that the proceedings be dismissed on the basis that each party pay its own costs: at [34]. On 20 September 2025, the defendants’ solicitor formally confirmed that his client “did not proceed with the claims at this time because of an undertaking given to the court in unrelated proceedings that restrained them from making representations necessary to prosecute the claims”: at [36]. As the primary judge stated, this statement was “plainly a reference to Mr Crown’s Undertaking”: at [37].
On 22 September 2025, Mr Harrison requested clarification of the nature of Mr Crown’s undertaking, the proceedings in which it was given, and why it was relevant to the decision not to proceed with the claims: at [38]. Arbitrium did not receive a response to this email and was not informed of the terms of Mr Crown’s undertaking until 29 September 2025: at [38].
At a directions hearing before the primary judge on 29 September 2025, Arbitrium indicated that it still wished to be heard on costs: at [5]. By interlocutory process dated 13 October 2025, Arbitrium sought an order that its costs of the proceedings be payable on an ordinary basis until 6 August 2025 (being the date that the statutory demands were issued), and on an indemnity basis thereafter (being the costs of the interlocutory process). Arbitrium also sought a gross sum costs order and an order that the defendants and the applicant be jointly and severally liable for the payment of the costs: at [6].
The primary judge stated at [7]:
As to third-party costs, his Honour accepted Arbitrium’s submission that it was appropriate to order the defendants and the applicant be jointly and severally liable for Arbitrium’s costs of the proceedings, having regard to the following, (at [61]-[64]):
The applicant was the sole shareholder and director of the defendants and appeared to have control of the proceedings on behalf of the defendants.
It could be inferred that the applicant had funded the defendants’ issue of the statutory demands and defence of the proceedings.
The applicant had an interest in the matter and had (at least in the recent past) substantial assets.
Upon giving Mr Crown’s undertaking, the applicant should have immediately caused the defendants to withdraw the statutory demands. The commencement of the proceedings and resulting costs were the result of his failure to do so. The delay between the undertaking and formal confirmation that the statutory demands were withdrawn was unexplained, unreasonable and caused substantial costs to Arbitrium.
The primary judge found that it was appropriate to make a gross sum costs order on the basis of the invoices which were before the Court: at [71]-[73]. The total costs incurred by Arbitrium in the period from 14 August 2025 to 20 September 2025 were $45,732.43 (including GST): at [74]. Following the application of a 10% discount to solicitors’ fees, and a further 10% discount to reflect that there would be no assessment and the parties against whom the costs order was to be made were losing the opportunity of doing better, his Honour fixed Arbitrium’s costs up to 20 September 2025 in the amount of $39,000 (inclusive of GST): at [75]-[77].
As to the costs of the interlocutory process, based on the invoices that were before the Court, his Honour found that the total costs incurred by Arbitrium from 21 September 2025 onwards were $29,624.10 (including GST): at [78]. Following the application of a discount of 30% on solicitors’ fees, 10% on counsel’s fees, and a further 10% discount applied for the same reason as in the case of gross sum costs above, his Honour fixed Arbitrium’s costs of the interlocutory process in the amount of $20,000 (inclusive of GST): at [78]-[81].
In his affidavit affirmed 2 June 2026, Mr Harrison corrected a number of typographical errors in the affidavit that he affirmed on 2 November 2025. The mistakes in the earlier affidavit included a mistranscription of the applicant’s email address that Mr Harrison had regularly used, as well as an error as to specific dates and times which were not material in circumstances where the documents were in evidence. In his 2 June 2026 affidavit, Mr Harrison also deposed that, following the directions hearing on 3 November 2025, he sent an email to both the Coronam email and the Resilient email, notifying the applicant of the orders that had been made (at [7]). According to the email receipts he received, which were exhibited to this affidavit, both of those emails were opened on the same day.
In response to Mr Harrison’s affidavit, the applicant affirmed the 5 June 2026 affidavit. The focus of that affidavit, and a number of the applicant’s submissions at the hearing, was the format of the read receipts that were exhibited to Mr Harrison’s affidavit before the primary judge and in this Court. The applicant submitted that the read receipts were not in what he described as the “true” Message Disposition Notification (MDN) or read receipt format, which must be requested by the sender and requires agreement by the receiver to be sent. It was submitted that the read receipts before the Court were, at best, evidence of an automated process without human involvement. By way of contrast, the applicant tendered an example of a “true” read receipt he received from Mr Harrison on 28 May 2026.
The applicant deposed that he did not open the emails sent to either account at any time before he read the primary judge’s reasons for decision, at some time between 3 December 2025 and 30 December 2025 (at [11]). He also deposed that he did not elect to send any read receipt for any of the emails (at [12(d)]). He accepted that he had used the Resilient email in the past, but said that he had not used it since 2023 (at [8]). He pointed out in submissions that, contrary to Mr Harrison’s affidavit of 2 November 2025 that was before the primary judge, the term sheets for the transaction, pursuant to which the statutory demands were made, did not specify any email address for him. Arbitrium appears to accept this is the case, as Mr Harrison exhibited to his 2 June 2026 affidavit the “Land Facility Agreement” that the borrowers entered into with Merricks and which they were seeking to refinance with Arbitrium. As the applicant submitted, Arbitrium was not a party to that earlier agreement.
The applicant submitted that the evidence required by UCPR r 10.14(3A) was not satisfied in the present case. That rule requires that an application for an order under r 10.14(3) be accompanied by an affidavit that includes a statement as to the applicant’s knowledge of the whereabouts of the person to be served (r 10.14(3A)(a)), and a statement as to any communications that have occurred between the applicant and the person to be served since the cause of action in the proceedings arose (r 10.14(3A)(b)). The applicant submitted that Mr Harrison’s affidavit did not depose to the first of those matters, and that an alleged read receipt from an old email account did not satisfy the second.
The applicant has not established that in making the order in the exercise of the discretion conferred by UCPR r 10.14(3), the decision of the primary judge was attended by injustice rising above merely arguable.
His Honour was informed — as was the case — that there had been one unsuccessful attempt at personal service on the applicant. However, as Mr Harrison’s affidavit of 2 November 2025 deposed, there had also been email communications between him and the applicant in relation to the dispute the subject of the underlying proceedings and the interlocutory process. The affidavit disclosed the following chronology:
In terms of the underlying proceedings that Arbitrium commenced to set aside the statutory demands, Mr Harrison and the applicant exchanged a number of emails, using the applicant’s Coronam email (at [6]).
The interlocutory process was dated 13 October 2025 (at [8]).
On 14 October 2025, Mr Harrison had a telephone conversation with the solicitor then on the record for the defendants, Peter Jackson of FCW Lawyers, as to whether Mr Jackson had instructions to accept service on behalf of the applicant. Mr Harrison recorded that Mr Jackson told him that “he would try to speak to [the applicant] the following morning” (at [7]).
On 20 October 2025, Mr Harrison emailed Mr Jackson about the same issue and was informed by return email that Mr Jackson had not received instructions to act for the applicant (at [9]).
By email dated 29 October 2025 at 10.44am AWST, sent to the Coronam email (as corrected in Mr Harrison’s 2 June 2026 affidavit), Mr Harrison alerted the applicant to the interlocutory process having been purportedly personally served on him, and attached the email sent that day by the primary judge’s associate. According to a read receipt exhibited to the 2 November 2025 affidavit, the email was opened at 3.27pm the same day (at [10]).
By email dated 30 October 2025 at 12.01pm AWST (as corrected in Mr Harrison’s 2 June 2026 affidavit), sent to the Coronam email, Mr Harrison sent the applicant proposed directions for the hearing on 3 November 2025, for his consideration. A read receipt for this email, exhibited to the 2 November 2025 affidavit, indicated that it was opened at 6.53pm the same day (at [11]).
By email dated 31 October 2025, sent to both the Coronam email and the Resilient email, Mr Harrison attached the interlocutory process. A read receipt from the Resilient email, exhibited to the 2 November 2025 affidavit, indicated that the email was opened by that address at 10.55am the same day (at [12]).
In circumstances where the applicant was not personally served with the documents when the process server attended his residence, counsel for Arbitrium did not seek an order that service was effected on that date. Rather, at the hearing on 3 November 2025, he sought an order that service was effected on the later date of 31 October 2025, being the date of his email attaching the interlocutory process.
As the applicant emphasised in his written submissions and at the hearing, there was no read receipt for the Coronam email in relation to the email of 31 October 2025. However, even without a read receipt from that account, Mr Harrison’s affidavit indicated that the applicant regularly used the Coronam email, including to exchange emails with Mr Harrison. It was open to the primary judge, in the exercise of the discretion conferred by UCPR r 10.14(3), to rely on the evidence of these exchanges to make an order for substituted service with respect to the email sent to both the Coronam email and, in light of the read receipt noted at [40(7)] above, the Resilient email. Having made that order, the primary judge was entitled to proceed with making his Honour’s orders as to costs on 3 December 2025, the applicant having been personally served for the purposes of the UCPR (see r 10.14(4)).
Even if the Court were satisfied that the evidence as to service disclosed an injustice that was more than reasonably arguable, the foregoing summary demonstrates that the applicant wishes to agitate what is essentially a factual dispute on a matter of practice and procedure, where the decision concerns costs alone and the amount of costs involved is $59,000. As this Court stated recently in The trustee for Dawson Street Unit Trust trading as Dawson Street Auto Centre Pty Ltd v 4Cyte Pathology Pty Ltd [2026] NSWCA 78 at [13]: