Gigi Entertainment Pty Limited v Schmidt

Supreme Court of NSW|2013-03-01|Before: Schmidt J, Cole J

Judgment 1Judgment was given in this matter on 23 November 2012 (see Gigi Entertainment Pty Limited v Schmidt [2012] NSWSC 1423). I concluded that there was to be judgment for the plaintiff, Gigi, on its claim and judgment for Mr Schmidt, the defendant, on his cross-claim. The parties had to formulate orders and were given liberty to approach as to interest and costs. 2They were unable to agree on certain matters and in February 2013, Gigi filed a motion seeking leave to re-open its case in order to claim certain legal costs and disbursements incurred, it said, on termination of the lease and re-entry of the premises and in the proceedings, as well as a stay. 3I refused the re-opening application at the hearing, indicating that I would later give reasons. That had an impact on the other matters in issue between the parties, which included whether any declaratory orders should be made; whether a net money order should be made in favour of Mr Schmidt; whether an order for payment out of moneys held in court should be made in favour of Mr Schmidt; whether prejudgment interest should be ordered in his favour; what order should be made as to costs; whether interest on costs should be ordered and whether there should be any stay ordered.

Consequences of the refusal of the re-opening application - net judgment to be ordered and payment out to Mr Schmidt 25The money sums resulting from the judgment were agreed. Gigi submitted that if it was not granted leave to re-open, the orders to be made were: "1. judgment in favour of the plaintiff in the sum of $103,398.90 in respect of its Statement of Claim; and 2. judgment in favour of the defendant in the sum of $164,239.90 in respect of its Cross Claim." 26For Mr Schmidt it was argued that the discretion given by s 90(2)(a) would be exercised to make a net judgment in his favour for the sums awarded in on the respective claims, together with prejudgment interest. 27In the circumstances it seems to me that is the just course. 28Adams J made orders as to security, in connection with the adjournment of the first trial. Given the conclusion reached, an order for payment out of moneys held in court should now be made in favour of Mr Schmidt.

Declaratory relief 29I do not propose to make the declaratory orders proposed by Gigi. They were not sought or addressed at the hearing and are unnecessary to resolve the matters over which the parties joined issue, which have already been dealt with in the November judgment and will adequately be dealt with by the other orders which I propose to make.

Pre-judgement interest 30Since it purchased the hotel in December 2007, Gigi has had the benefit of the $250,000 security deposit Mr Schmidt paid the former owner in January 2007. These proceedings have resolved that on termination in January 2008 he should have been repaid a considerable sum, excluding the two weeks rent outstanding and the matters which the parties agreed or were resolved in Gigi's favour by the November judgment. In the result Gigi has had the benefit of that sum in the meantime. In the ordinary course, Mr Schmidt would be entitled to interest on that sum under s 100 of the Act. 31It was in those circumstances that Gigi did not seek any interest in its favour and argued that none should be awarded in Mr Schmidt's favour, given his conduct in the proceedings. No authority could be pointed to, which supported the course urged, including the authorities to which reference was made in submissions. In Ruby v Marsh [1975] HCA 32; (1975) 132 CLR 642 at [26] the purpose of giving courts the power to award interest (in that case on damages awarded to a plaintiff) was explained to be twofold. The first, so that the successful party 'ought in justice to be placed in the position in which he would have been had the amount of the verdict been paid to him at the date of the commencement of the action'. The second, to discourage delaying settlement of the claim or 'an early conclusion of proceedings, so as to have over a longer period of time the profitable use of the money which ultimately the party is called upon by judgment to pay'. 32In Bennett v Jones and Another [1977] 2 NSWLR 355, Hutley JA observed that 'I am by no means convinced that the conduct of the parties should ordinarily affect the award of interest'. In ICT Pty Limited v Sea Containers Limited [2006] NSWSC 1280 at [14] - [19], Einstein J considered the impact of delay, but that was a case concerned with a claim for interest on costs and thus is not relevant to this issue. 33Here the conduct which Gigi relied on were Mr Schmidt's late concessions earlier identified, including in relation to Gigi's rights to part of the security deposit; and his conduct in lodging a caveat on the property, when the lease was terminated, claiming an equitable interest. He conceded this interest to have been non-existent in July 2012, yet still refusing to remove the caveat. 34This argument was advanced by way of analogy to mortgage security and a mortgagee's obligations. It was submitted that a lessor's obligation to return the security deposit only arose upon an unqualified tender, that is, when the lessee acknowledges the lessor's entitlement to retain part of the deposit. In the result, here Gigi was entitled to retain the benefit of the security deposit, including as to its costs of the proceedings, until the late concession made by Mr Schmidt on 5 July 2012, just before the hearing commenced. 35No authority supporting that approach could be pointed to. Nor was it submitted to be an approach which flowed from a proper construction of this lease. It is an approach which does not appear to accord with the purpose for which such a security deposit is given. 36Nor can I see reason why a lessor should be relieved of the obligation to pay interest on part of a security deposit which it has no entitlement to retain on termination of the lease, simply because the lessee does not acknowledge the lessor's entitlement to the amount which the lessor retains. 37Nor can I see why, in the event of a dispute, a lessor who has retained part of a security deposit which the lessee later establishes the lessor ought to have repaid on termination of the lease, ought not to be required to pay interest on the money which the lessor has had the use of in the meantime. 38Nor does the plaintiff's approach reflect that in this case, Gigi's claim for $1.46m damages was referred to a referee, whose report was dealt with by Hall J (see Gigi Entertainment Pty Ltd v Schmidt [2010] NSWSC 906). His Honour concluded that in large part, Gigi's claims had not been established. Before the hearing, Mr Schmidt made a concession in relation to certain items, leaving a relatively minor part of Gigi's claim left to be resolved at the hearing. 39Gigi retained the entire $250,000 security deposit, later bringing these proceedings, claiming that it was entitled to what now appears to have been an incredible $1.46 million damages from Mr Schmidt, who had been in occupation of this hotel for only about a year. An order for interest in Mr Schmidt's favour, if Gigi did not make out its case, was plainly a risk of the litigation which it pursued. It has only established an entitlement to some $103,398 even after the repeated amendment of the pleadings by which it sought to make good its claims. 40Prior to the hearing Mr Schmidt made appropriate concessions as to the termination of the lease. Before that, by the referee process which the parties had pursued and the expert evidence which they had led, a large part of the damages Gigi had pursued fell away. 41As the result of the hearing Mr Schmidt has established that Gigi was not entitled to have retained the entirety of the security deposit on termination of the lease. That successful defence of Gigi's claim does not appear to me to be a just basis on which to deny him an order for interest. 42It also does not seem to me that Mr Schmidt's failure to remove the caveat establishes disentitling conduct. Once the lease was terminated, Mr Schmidt no longer had any leasehold interest in the property. That was properly conceded prior to the hearing in July 2012. Sensibly, it should also have resulted in the removal of the caveat, but the failure to remove the caveat did not involve any misconduct in these proceedings. Even if it did, that does not appear to be a proper basis for refusing to award interest against Gigi, in respect of money which it has had the use of in the meantime. 43The evidence does not establish that the failure to remove the caveat resulted in Gigi suffering any quantifiable damage, even on Mr Gerzilis' evidence. Also to be considered is that there was nothing which prevented the lapsing notice recently issued by Gigi being issued earlier. On the evidence, it appears that such a notice could not have been resisted by Mr Schmidt. If the caveat had really been inflicting any damage on Gigi, no doubt the available steps would have been taken. 44Also necessary to be considered is that the hearing occurred only in 2012, because of the extraordinary way in which Gigi conducted this litigation. That the further hearing in 2013 was partly the result of an unsuccessful attempt to re-open its case, also cannot be overlooked. 45In all of those circumstances I do not consider that it would be just to refuse to order interest on the sum to be awarded in Mr Schmidt's favour, including for the net amount owing to him under the lease, calculated from the day after the termination of the lease.

Interest on costs 46Mr Schmidt also sought an order under s 101(4) for interest payable on costs, as discussed by Brereton J in Hexiva Pty Ltd v Lederer (Costs) [2006] NSWSC 1259: "21 An order under s 101 for interest on costs recognises and compensates the costs creditor for having been out of pocket as a result of having to pay their lawyers' costs and disbursements, and there is no requirement before such an order is made that the circumstances of the case be out of the ordinary [Grogan v Thiess Contractors Pty Ltd [2000] NSWSC 1101, [10], [12]; Australian Development Corporation Pty Ltd v White Constructions (ACT) Pty Ltd (in liq) [2002] NSWSC 280, [17], [23]-[25]; Puntoriero v Water Administration Ministerial Corporation [2002] NSWSC 217, [10]; Lahoud v Lahoud [2006] NSWSC 126, [82]-[83]]. Not much if any evidence is required in support of such an application: it can be inferred from the nature of commercial litigation that parties are likely to have had to pay some amounts of costs and disbursements as the litigation progresses and in any event an order can be framed in such a way that interest will run only from the date on which there has been a payment [Lahoud v Lahoud, [80]-[81]]." 47Section 101 provides: "101 Interest after judgment (cf Act No 52 1970, section 95; Act No 9 1973, section 85; Act No 11 1970, section 39) (1) Unless the court orders otherwise, interest is payable on so much of the amount of a judgment (exclusive of any order for costs) as is from time to time unpaid. (2) Interest under subsection (1) is to be calculated, at the prescribed rate or at such other rate as the court may order, as from: (a) the date on which the judgment takes effect, or (b) such later date as the court may order. (3) Despite subsection (1), interest is not payable on the amount of a judgment if the amount is paid in full within 28 days after the date on which the judgment takes effect, unless the court orders to the contrary. (4) The court may order that interest is to be paid on any amount payable under an order for the payment of costs. (5) Interest under subsection (4) is to be calculated, at the prescribed rate or at such other rate as the court may order, as from: (a) the date or dates on which the costs concerned were paid, or (b) such later date as the court may order. (6) This section does not authorise the giving of interest on any interest payable under this section. (7) In this section, a reference to the prescribed rate of interest is a reference to the rate of interest prescribed by the uniform rules for the purposes of this section." 48Section 101 itself contemplates that costs might not have been paid when an order under s 101(4) is made. In that event, s 101(5) requires that interest is payable from the date of payment, or any later date ordered. 49Gigi opposed such an order being made in Mr Schmidt's favour, he not having paid any costs on the evidence. However, it sought that such an order should be made in its favour. Gigi initially submitted that such an order required evidence that costs had been paid. That was disputed for Mr Schmidt, for whom it was submitted to be relevant that the form of the order he sought contemplated that interest would only run from payment of the costs, thus prior payment was not required. 50The parties were given leave to file further submissions as to this question. The position appears to be resolved by Drummond & Rosen Pty Limited v Easey (No 2) [2009] NSWCA 331 where McFarlane JA, with whom Tobias JA agreed on this point (see at [1]) observed: "3 The matter in relation to which I respectfully disagree with his Honour is as to the making of an order for payment of interest on costs. His Honour has quoted the terms of s 101(4) and (5) of the Civil Procedure Act 2005. In my view it is unnecessary for there to be evidence of the date or dates on which the costs concerned were paid for an order for the payment of interest to be made under subsection (4). Indeed, such evidence would often not be particularly useful. If the Court does not choose to order that interest be payable from a later date, interest will run, if an order is made under subsection (4), from the date or dates on which the costs concerned were paid. If the costs were paid promptly, interest will run from an earlier date than that from which it would run if there was delay in payment. That is an appropriate result as the purpose of an order for payment of interest is essentially compensatory. I do not see why in the usual case the Court needs to know when the costs were paid. 4 In the absence of any countervailing discretionary factor (of which there appear to be none in the present case), it is appropriate that an order for interest on costs be made to compensate the party having the benefit of a costs order for being out of pocket in respect of relevant costs which it has paid (Lahoud v Lahoud [2006] NSWSC 126 at [82-3] per Campbell J)." 51In a number of subsequent cases this approach has been followed (see Tomasetti v Brailey [2012] NSWSC 120 at [10]; Amalgamated Holdings Ltd v North Sydney [2012] NSWLEC 138; (2012) 191 LGERA 51 at [48]; Wood v Inglis Research Trust Pty Ltd [2010] NSWSC 749 at [11]) . Black J appears to have considered that Handley AJA was in the majority in Drummond (see Samkev Investments Pty Ltd (No 2) [2012] NSWSC 745 at [13]; Ryding v Miles [2012] NSWSC 312 at [17]). Einstein J took a somewhat different view in North Sydney Leagues Club Ltd v Synergy Protection Agency Pty Ltd [2011] NSWSC 804 at [19]. 52In Corbett v Nguyen (No 2) [2012] NSWSC 673 Windeyer AJA observed: "The defendants seek interest on costs under s 101(4) of the Civil Procedure Act 2005. No evidence was put before me to support this claim. I am aware that the solicitors for the defendants, in response to a direction of the Chief Judge, filed a schedule of costs rendered up to 4 November 2010 the total being $290,484.19. There is no evidence as to whether any payment has been made of any of the 36 invoices making up the total amount. I realize that in Lahoud v Lahoud [2006] NSWSC 126, Campbell J at 81 said this was not necessary and an order could be framed so that interest would run from dates of payment. While I accept that could be done I am, with respect, of the view that there should be evidence to support such an order and in the absence of evidence I do not consider such an order should be made. As I have said before, the plaintiff and defendants were fighting for costs quite disproportionate to the amounts at issue. One would expect any claim for interest to be supported by evidence. I note that in Hughes Bros Pty Ltd v The Trustees of the Roman Catholic Church for the Archdiocese of Sydney (Foster AJ, 25 October 1999, unreported) BC9907002, a case relied on by the defendants, there was evidence of payments. In the same way I consider that if a claim is said to be justified by the inordinate delay in bringing the proceedings to a hearing it would need to be established this was the fault of the plaintiff. I have had no connection with the case during its preparation and cannot decide on fault. Had there been evidence of payment I would have ordered interest on costs incurred prior to the final amendment to the statement of claim from the dates of payment." 53Here, the evidence shows that Mr Schmidt is in a precarious financial positon. It does not appear that any of his costs have been paid. Given the provision of s 10A and applying Drummond, I do not consider that he should be shut out of an order for interest, if the costs are paid. 54Given the conclusions I have reached on the question of costs, Mr Schmidt should have an order for interest on costs, in the terms he seeks.

Costs 55The usual order as to costs is that they follow the event, but the Court has power to make some other order (see s 98 of the Act and Rule 42.1 of the Uniform Civil Procedure Rules 2005). The order which Gigi pressed was a differential cost order, reflective of the parties' respective success on the various matters litigated. Mr Schmidt sought a costs order in his favour. 56The first matter to consider is what was here 'the event'. 57Both parties succeeded in part on the claims which they pursued. Gigi retained the $250,000 security deposit and sought some $1.46 million from Mr Schmidt in damages and made out some $103,000. Mr Schmidt pursued a cross-claim, seeking repayment of his $250,000 security deposit and damages, including in conversion and made out some $164,000. The overall result was a money order in Mr Schmidt's favour. 58Gigi submitted in determining the costs order that it would be considered that the issues raised on its case were: 1. whether it validly terminated the lease (paragraphs 4A, 4B, 6 and 7 of the FASOC); 2. its entitlement to recourse from the security bond of $250,000 (paragraph 12A of the FASOC); 3. Mr Schmidt's obligations to carry out repairs and maintenance of defects relating to the Hotel, the subject of the Lease (paragraphs 8, 9, 10, 11 and 12 of the FASOC); 4. its entitlement to damages in respect of its "loss of bargain" claim (paragraphs 12B and 12C of the FASOC); and 5. Mr Schmidt's liability for its legal costs, charges and expenses under clause 10(f) of the Lease (Memorandum O486173) (paragraph 16 of the FASOC). 59By his pleadings Mr Schmidt put in issue the validity of the termination of the lease, and the losses claimed, and by his cross-claim sought a declaration that the re-entry was in breach of the lease and/or a wrongful repudiation, as well as pursuing a claim in conversion. The validity of the termination was only conceded 4 days before the commencement of the hearing in July 2012, in circumstances where a significant part of the evidence led by Gigi, as well as the submissions prepared, were directed to the validity of the termination of the lease. In the result, it would be considered that Mr Schmidt had capitulated on this issue. 60In submissions dated 5 July, Mr Schmidt had also conceded that the security could properly be applied to rent and outgoings and that a sum of $70,708 was owing to Gigi under the lease for painting items. Gigi successfully argued for a 10% uplift of the cost of that rectification. Gigi failed on its loss of bargain claim, but had established an entitlement to payment of certain legal costs under clause 10(f). Mr Schmidt had succeeded in recovering part of the security bond and establishing claims in conversion. 61In the result Gigi argued that the appropriate order was: "1. the defendant to pay 60% of the plaintiff's costs on its Statement of Claim on a solicitor/client basis (excluding the costs identified in paragraph 18(a) of the affidavit of Grant Hansen sworn 21 February 2013 viz $146,570.85); and 2. the plaintiff to pay 30% of the defendant's costs on its Cross Claim on a party/party basis." 62In the alternative it was submitted that there should be no order as to costs. 63Mr Schmidt sought an order that Gigi pay his costs, the position being that on any practical assessment, Gigi had failed spectacularly. He would have to pay it nothing. Given the evidence of the extraordinary costs it had incurred, it would have been better off keeping the $250,000 bond and leaving Mr Schmidt to pursue proceedings if he wished. Had it claimed its actual entitlements under the lease, rather than pursing an untenable and inflated claim, the proceedings would have been unnecessary. 64Thus it was submitted, the real 'event' was the practical outcome of the proceedings, as discussed by in MacKinnon v Petersen (Supreme Court of New South Wales, Cole J, 19 April 1989, unreported) where Cole J observed: "It is clear that the general rule is that costs follow the event. A judge must, in each instance, consider whether there are circumstances justifying a departure from this rule. In litigation involving the construction industry, it is common for there to be a sum claimed which is comprised of a multitude of smaller sums. Each constituent ingredient normally requires some separate consideration at the hearing to a limited extent. Frequently, reasons of a judge or arbitrator isolate a separate finding in respect of the constituent claims. However, in truth, the matter in dispute between a proprietor and a contractor is the ultimate sum due from one to the other. Particularly is that so at the conclusion of a construction contract. In my view, as a general rule, it is wrong in concept to regard litigation in the construction industry in which a sum claimed comprises a multitude of claims requiring resolution, as being a series of separate and distinct claims each of which should attract separate consideration in relation to costs. Normally the general rule will apply. Of course, there may be cases in which a particular item, issue or aspect of the litigation is so dominant or separable that, in the exercise of a judicial discretion, it will be appropriate to award costs to a party successful on that issue although unsuccessful overall, or to decline to award the successful party overall the costs of that issue. However, in the usual case where the parties are concerned with the amount of money payable by the owner to the builder, or vice versa, and resolution of that issue involves the determination of many separate issues, claims or aspects of liability, the normal approach should be to regard the party who obtains a verdict as being successful in the litigation and entitled to its costs. The real dispute between parties in such circumstances is not the entitlement in relation to each of a multitude of claims, but the overall entitlement or obligation of one party from or to the other. The circumstance that many smaller constituent claims require consideration will not normally, of itself, be a sufficient ground for departing from the usual rule prescribed by Pt(52) r11." 65This was submitted to be an analogous situation, given the claims Gigi had advanced under the lease as to repairs required to the Hotel. 66It seems to me that there is some force in that submission, given the case which Gigi pursued and how it was resolved. Not only did its case on loss of bargain damages fail, the bulk of its claims in relation to repairs failed, with the result that it has to repay Mr Schmidt a considerable part of the security deposit. 67The conduct of a party in the litigation is a relevant matter to consider. In Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72, McHugh J explained at 97: "The expression the "usual order as to costs" embodies the important principle that, subject to certain limited exceptions, a successful party in litigation is entitled to an award of costs in its favour. The principle is grounded in reasons of fairness and policy and operates whether the successful party is the plaintiff or the defendant. Costs are not awarded to punish an unsuccessful party. The primary purpose of an award of costs is to indemnify the successful party [Latoudis (v Casey) (1990) 170 CLR 534 at 543 per Mason CJ, at 562-563 per Toohey J, at 566-567 per McHugh J; Cachia v Hanes (1994) 179 CLR 403 at 410 per Mason CJ, Brennan, Deane, Dawson and McHugh JJ]. If the litigation had not been brought, or defended, by the unsuccessful party the successful party would not have incurred the expense which it did. As between the parties, fairness dictates that the unsuccessful party typically bears the liability for the costs of the unsuccessful litigation. As a matter of policy, one beneficial by-product of this compensatory purpose may well be to instil in a party contemplating commencing, or defending, litigation a sober realisation of the potential financial expense involved. Large scale disregard of the principle of the usual order as to costs would inevitably lead to an increase in litigation with an increased, and often unnecessary, burden on the scarce resources of the publicly funded system of justice. The traditional exceptions to the usual order as to costs focus on the conduct of the successful party which disentitles it to the beneficial exercise of the discretion. In Anglo-Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [[1951] 1 All ER 873 at 874], Devlin J formulated the relevant principle as follows: "No doubt, the ordinary rule is that, where a plaintiff has been successful, he ought not to be deprived of his costs, or, at any rate, made to pay the costs of the other side, unless he has been guilty of some sort of misconduct." "Misconduct" in this context means misconduct relating to the litigation [King & Co v Gillard & Co [1905] 2 Ch 7; Donald Campbell & Co Ltd v Pollak [1927] AC 732 at 812], or the circumstances leading up to the litigation [Bostock v Ramsey Urban District Council [1900] 2 QB 616]. Thus, the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation [Jones v McKie [1964] 1 WLR 960; [1964] 2 All ER 842; Bostock [1900] 2 QB 616 at 622, 625, 627]; unnecessarily protracts the proceedings [Forbes v Samuel [1913] 3 KB 706]; succeeds on a point not argued before a lower court [Armstrong v Boulton [1990] VR 215 at 223]; prosecutes the matter solely for the purpose of increasing the costs recoverable [Hobbs v Marlowe [1978] AC 16]; or obtains relief which the unsuccessful party had already offered in settlement of the dispute [Jenkins v Hope [1896] 1 Ch 278]." 68Here each party asserted relevant misconduct on the part of the other. On Mr Schmidt's part, the extraordinary claim advanced and the unnecessary protraction of the proceedings by the way in which it was conducted by Gigi. On Gigi's part, by Mr Schmidt having raised a defence in relation to the termination of the lease which was only disavowed late and conceding his obligation to pay for painting repairs only shortly prior to the hearing. 69It seems to me that these two situations were not strictly comparable. Mr Schmidt's concession in relation to both matters were properly made, and if they been made earlier, some costs would not have been wasted. By way of comparison, the unnecessarily protracted way in which the litigation was conducted by Gigi, however, continued not only up to the hearing, it continued during the hearing and afterwards. The result was not only adjournment of the first hearing with a costs order against Gigi, but repeated interlocutory applications pressed both during the course of the hearing and even after judgment, which failed. 70It seems to me that the just order to be made in all of these circumstances has to have real regard to the fact that overall, Mr Schmidt succeeded in this unnecessarily protracted litigation, but that certain costs were wasted, by his failure to make more timely concessions as to Gigi's right to terminate the lease and the painting claims. 71In Cobalt v Nguyen (No 2), there Windeyer AJA also had to deal with proceedings which had had a difficult history, eventually proceeding on a third amended statement of claim after the first hearing in March 2011 was vacated, because the plaintiff was not ready to proceed. His Honour observed that while in some cases there can be a number of events, each of which relates to a particular issue, in others the real event is which of the parties is a winner and which is a loser in the overall sense. There the defendant was the clear winner. I consider that Mr Schmidt was the clear winner in this case. In the result, his Honour ordered a reduction of 10% of the defendant's costs as a proper recognition of the success of the plaintiff, observing 'if anything that is somewhat generous.' 72The order proposed by Gigi does not fairly reflect all of the matters which require consideration in determining costs, to which I have referred. Mr Schmidt is the clear winner. Gigi should thus bear his costs of the proceedings, other than the costs thrown away as the result of the concessions that it had the right to terminate the lease and the painting costs. A fair reflection of that and Gigi's success otherwise in the proceedings is to reduce Mr Schmidt's costs by 18%.

Stay 73A stay pending assessment of Gigi's costs is not required, given the conclusion I have reached as to costs. 74Gigi also sought a stay of the orders pending an approach to the Court of Appeal, in terms which were finally not opposed by Mr Schmidt, provided the stay was granted on condition that Gigi undertake not to dispose of or deal with the Hotel, without consent of Mr Schmidt or leave of the Court. Gigi did not give that undertaking and opposed the imposition of such a condition, which it submitted amounted to a post judgment mareva injunction, in respect of which Mr Schmidt had not provided undertakings, or made out a case. 75The condition sought in my view could plainly not be ordered, having in mind the money order made in favour of Mr Schmidt, the security provided and that by its terms, it would even preclude Gigi refinancing. Gigi has paid considerable security sufficient to cover the amount of the order made in Mr Schmidt's favour, but not costs. They have yet to be assessed. 76Notwithstanding the evidence of Gigi's financial circumstances, which has clearly been adversely affected by this litigation, given that the stay is only for 28 days, while the Court of Appeal is approached, I do not consider it just to impose the condition sought. Gigi's circumstances are not such that the order sought could justly be grantred.

Orders 77The parties should now file short minutes reflecting these conclusions within 7 days. They should include the following order as to return of the exhibits: "that exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person that produced the material until the expiry of the time to file and appeal, or until any appeal has been determined."

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 March 2013

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