Hua Cheng Property Pty Ltd & Ors v Xu & Ors

Background 2There is a background to these proceedings that is relevant at least to the ninth order sought. The background is set out in reasons for judgment given by Gzell J on 31 March 2010 in Lu v Hua Cheng International Holdings Pty Ltd [2010] NSWSC 228 and in the orders made by his Honour on 9 April 2010 in those proceedings. 3His Honour recorded that Ms Lu and Ms Hung had entered into an agreement with Mr Xu for the development of land in Hurstville. The joint venture was estimated to cost $30 million. The initial arrangements were that Ms Lu and Ms Huang were each to contribute $4 million; Mr Xu was to contribute $2 million and raise the remaining $20 million. The proceedings before Gzell J arose because the Hurstville land was not acquired by HCP. Instead, his Honour recorded Mr Xu caused the Hurstville land to be acquired by Hua Cheng International Holdings Pty Ltd ("HCIH"). This was a company in which Mr Xu held 85 shares, Ms Xia held 15 shares and Ms Lu held the remaining 35 shares. 4His Honour recorded that after the purchase of the Hurstville land was completed on 20 December 2007 Mr Xu considered that the existing development application would not provide for the most profitable exploitation of the land. He estimated that construction costs, presumably for the more profitable exploitation of the land, were estimated to be about $60 million and as a result Ms Lu and Ms Huang asked him to assume a larger share of the project following which from January 2008 they transferred shares in HCP to Mr Xu, retaining 20 shares each while he then held 60 shares. 5His Honour found that HCIH held the Hurstville land on trust for HCP. His Honour noted that that form of relief was opposed by Ms Lu and Ms Huang, but their opposition was unsuccessful. His Honour recorded that a development approval application had been issued for a 17-storey building and that the project had already been successfully marketed off the plan. Contracts had been exchanged for 50 residential units and five commercial units. His Honour declared that HCIH held the Hurstville land on trust for HCP. His Honour ordered that HCP reimburse HCIH in respect of any payments that HCIH made or had made to Westpac under a loan facility in relation to the land and ordered that HCIH account to HCP for rents and profits it had received from the land. His Honour restrained HCIH from claiming from HCP any amount for payment of the cost of the property other than in respect of the payments made or to be made by HCIH under the loan facility. His Honour ordered that Ms Lu and Ms Huang be appointed as directors of HCP. His Honour also said in his reasons for judgment (at [100]) that: "[100] There is a fourth adjustment I think should be made to ameliorate the lack of confidence and trust Mrs Lu and Mrs Huang have in Mr Xu. I propose to order the directors to appoint a suitable person who consents to the role of acting as a referee should any dispute arise between the directors as to any course to be taken by Hua Cheng Property in developing the Hurstville land and an order that each of the directors will be bound by any decision of the referee." 6The order made to give effect to that part of his Honour's reasons was: "5. Orders that the Fourth Defendant appoint a person agreed by the Plaintiffs and the Second and Third Defendants to act as referee in respect of any disputes in relation to the course to be taken by the fourth defendant in the development of the Hurstville land and that the decision of that person be binding on the parties. In the event agreement is not reached within 14 days of the date of these orders, the Fourth Defendant will appoint a person selected by the Chairman of the Institute of Arbitrators and Mediators." 7It is clear from the second sentence of order 5 that Gzell J intended that HCP should appoint a referee with reasonable promptitude without necessarily having to wait until a dispute had arisen in relation to the course to be taken by HCP in the development of the Hurstville land. In the events which have happened no such referee has yet been appointed. On the other hand, neither party contends that order 5 has ceased to have effect. Although the application for an order that no director of HCP be appointed without the leave of this Court was initially put on a wider ground, I understand the principal basis on which that relief is sought is in order to prevent a subversion of the intention behind order 5. 8The constitution of HCP includes the following provisions: "32. (1) Subject to this Constitution, a Member may transfer all or any of his shares by instrument in writing in any usual or common form or in any other form that the Directors approve. (2) An instrument of Transfer referred to in Clause 32.(1) shall be executed by or on behalf of both the transferor and the transferee. (3) A transferor of shares remains the holder of the shares transferred until the transfer is registered and the name of the transferee is entered in the register of Members in respect of the shares. 33. The instrument of transfer must be left for registration at the registered office of the Company, accompanied by the certificate of the shares to which it relates and such other information as the Directors properly require to show the right of the transferor to make the transfer, and thereupon the Company shall, subject to the powers vested in the Directors by this Constitution, register the transferee as a Member. 34. (1) The Directors in their absolute and uncontrolled discretion may refuse to register any transfer of shares without assigning any reason therefore. (2) No transfer of shares shall be registered if upon its registration the number of Members of the Company would exceed the maximum number prescribed by Clause 5.(1). ... 49. Any Director may whenever he thinks fit convene a meeting of the Company's Members. ... 56. (1) No business shall be transacted at any meeting of the Company's Members unless a quorum of Members is present at the time when the meeting proceeds to business. (2) Two persons each being a Member or a proxy or a Representative of a Member shall be a quorum for a meeting of the Company's Members. If the Company has only one Member, that Member may pass a resolution by the Member recording it and signing the record. ... 73. ... (2) The Company may by resolution increase or reduce the number of Directors. (3) It shall not be necessary for any Director to hold any share qualification. 74. Subject to Clause 79, the Directors may at any time appoint any person to be a director, either to fill a casual vacancy or as an addition to the existing Directors, but so that the total number of Directors does not at any time exceed the number determined in accordance with this Constitution." 9The instrument of transfer of three shares from Mr Xu to Ms Xia is not in evidence. Nonetheless, it should be inferred, and it was not disputed, that on or prior to 10 January 2013, Mr Xu and Ms Xia executed an instrument, presumably an instrument in usual or common form, for the transfer of the three shares. That transfer was not submitted to the board of HCP for consideration by all of the directors. Nonetheless, on 14 January 2013 Mr Xu arranged for a notice to be lodged with ASIC of the change in shareholding. He also caused entries to be made in the share register purportedly recording that Ms Xia had become registered as a holder of three shares numbered 98-100 pursuant to a transfer dated 10 January 2013. Mr Xu's solicitor, Mr Marrett of Chris Lee Lawyer, advised the plaintiffs' solicitors, Watson Mangione, on 5 March 2013 that: "The transfer was approved by Mr Xu as a director and we are instructed that a share transfer pursuant to HCP's constitution was executed and filed in the company's share register. Based on the executed share transfer, Mr Xu lodged the required form with the Australian Securities and Investments Commission to record Ms Xia as a shareholder of the company." 10On 18 January 2013 Mr Xu called a general meeting of the company as he was entitled to do as a director. The business of which notice was given was a proposal to increase the permitted number of directors to five and to appoint Ms Qiao Wang and Mr Thomas Xu as directors of HCP. They are the third and fourth defendants. 11On 8 February 2013 Watson Mangione acting for Ms Lu and Ms Huang wrote to Mr Marrett. They stated that their clients did not accept the validity of the notice convening the general meeting of shareholders. They also said: "It appears to be your client's intention to extend the number of directors of HCP so that he can force through the appointment of two of his associates as directors of the company. This has not been discussed with our clients nor has your client put any valid reasons as to why this would be in the interests of the company and its shareholders. That also appears to be directly contrary to the scheme for control of the company and the Hurstville development imposed by the Court in Lu v Hua Cheng International [2010] NSWSC 228. In those circumstances our clients do not agree with and oppose the appointments. We have conducted a company search of HCP with the Australian Securities & Investments Commission which purports to record a transfer of shares from Mr Xu to Mr [sic] Xia on 13 January 2013. We note that no transfer of shares has been approved by the directors of HCP as required by its Constitution and our clients dispute the validity of the transfer." 12It can be seen from this letter that Watson Mangione raised at least two grounds. The first was that the transfer of shares from Mr Xu to Ms Xia was invalid because its purpose was said to be to put Mr Xu in a position in which two of his associates could be appointed as directors of the company, which, it was said, was contrary to the scheme for control of the company imposed by the orders of Gzell J in Lu v Hua Cheng International Pty Ltd. The second ground was that the transfer of shares had not been approved by the directors as required by the constitution of HCP. 13A meeting described as a general meeting of shareholders was held on the following day, Sunday, 9 February 2013. Neither Ms Lu nor Ms Huang attended in person or by proxy. Mr Xu was present and Mr Marrett was present as proxy for Ms Xia. The proposed resolutions were passed on the votes of Mr Xu and Ms Xia. If Ms Xia was not a member of the company, there was no quorum and the resolutions would be ineffective. 14On 8 March 2013 Watson Mangione wrote to the third and fourth defendants, Mr Thomas Xu and Ms Wang, noting that they were purporting to act as directors of HCP. Watson Mangione foreshadowed applying to the Court the following week in relation to the purported transfer of shares from Mr Xu to Ms Xia and in relation to the purported appointment of them as directors of HCP. For reasons which are unclear, no such proceeding was commenced until the originating process was filed on 2 July 2013. 15Various items of business appear to have been considered and dealt with by Mr Xu, Mr Thomas Xu and Ms Wang. 16The relief claimed in these proceedings does not raise any issue as to the validity of such steps. 17It appears from what is called a minute of a directors' meeting held on 7 March 2013 that was attended by Mr Xu, Mr Thomas Xu and Ms Wang that Mr Xu informed those present that on 10 January 2013 he had sold three of his shares in HCP to Ms Xia and had at that time approved it as director and registered it. The minutes record that Mr Xu asked the board to ratify the sale. The minutes record that the directors present unanimously voted to accept the sale of Mr Xu's shares to Ms Xia. The defendants have not relied on that purported ratification as a defence to the claim for rectification of the share register. If Ms Xia's name ought not to appear on the register, then it is clear that there is power under s 175 for the Court to order rectification of the register. The plaintiffs being directors and shareholders of HCP have a legal and equitable right to see that the provisions of the constitution are complied with. 18Mr Rollinson of counsel who appeared for the defendants submitted that Mr Xu was entitled to transfer his shares subject only to the directors' right in their discretion to refuse to register the transfer. He submitted that article 34 required a positive decision to be made by the directors who override the parties' right to registration of the transfer. He submitted that the mere absence of permission or agreement by the plaintiffs being directors did not invalidate the transfer or deprive Ms Xia and Mr Xu of what was contended to be their right to have the transfer registered. In support of this submission, Mr Rollinson relied upon Sutherland v Bosch (Australia) Pty Ltd [2000] NSWSC 32; (2000) 33 ACSR 680. The articles in that case were in materially the same terms as the relevant articles in the present case. The facts were quite different. The issue raised was as to the validity of the appointment of an administrator who had purportedly been appointed as liquidator after the holding of a second meeting of creditors. He had caused proceedings to be commenced against the defendants to recover alleged unfair preferences. 19In Sutherland, at the relevant time, there was only one director. That director, a Mr McDonald, owned all of the shares in the company other than the one share that was transferred to him by an instrument dated 17 April 1997. The articles required, in the events that happened, for there to be a quorum of two directors to deal with a decision whether to decline to register the transfer. The question of the validity of the transfer of shares was relevant to an argument that on the principles in Re Duomatic Limited [1969] 2 Ch 365. The appointment of the administrator was effective on the basis that Mr McDonald was the sole shareholder or as being the only director. Santow J said: "[40] It is necessary at this point to refer again to the articles of association of the company. I am satisfied for the reasons I explain below that no action on the board's part was required to register the relevant transfer of shares and that on the balance of probabilities the transfer had been validly effected prior to 12 May 1997. In other words, I am satisfied that the act of registration under the articles of association would have been a purely administerial act not requiring any formal resolution on the board's part. Therefore the meeting, though inefficacious, was never legally necessary. [41] To explain, disregarding art 28 which is a pre-emptive rights provision not relevant where the transfer was to the sole remaining shareholder, arts 29-32 are as follows: 29(1) Subject to Article 28, a member may transfer all or any of his shares by instrument in writing in any usual or common form or in any other form that the Directors approve. (2) An instrument of transfer referred to in Sub-Article (1) shall be executed by or on behalf of both the transferor and the transferee. (3) A transferor of a share or shares remains the holder of the share or shares transferred until the transfer is registered and the name of the transferee is entered in the register of members in respect of such share or shares. 30 The instrument of transfer must be left for registration at the registered office of the Company, accompanied by the certificate of the shares to which it relates and such other information as the Directors properly require to show the right of the transferor to make the transfer, and thereupon the Company shall, subject to the powers vested in the directors by these Articles, register the transferee as a shareholder. 31 The Directors may decline to register any transfer of shares, without giving any reason therefor. 32 The registration of transfers may be suspended at such times and for such periods as the Directors from time to time determine not exceeding in the whole 30 days in any year. [42] It is readily apparent that while it requires a positive act by the board as the relevant organ of the company to 'decline to register any transfer of shares ...', no such positive act is required where the transfer is in usual or common form, executed by both parties, as was the case here and, as can be inferred, was left for registration at the registered office of the company accompanied by the relevant share certificate. The company may then register the transferee as a shareholder, subject only to the powers vested in the directors by the articles, namely to decline to register a transfer of shares. Such an outcome finds support in the proposition that, prima facie, shares are transferable: see, eg, Greenhalgh v Mallard [1943] 2 All ER 234. If there be any ambiguity, articles of association should be construed with that prima facie position in mind. [43] It is hardly to be expected that Mr Macdonald as the sole director at the time, who is the beneficiary of the share transfer, would if competent to act have declined to register the shares to himself. Indeed by art 77 he could not have so acted as to do so would fall outside the permitted acts for a non-quorum board. Thus while some implication from the pre-emptive rights art 98 might suggest that a transfer of shares which triggered the pre-emptive rights would need first to go to the board in order that the board fulfil the functions laid down by that article, there can be no such implication here." 20Mr Rollinson relied upon what was said at para [42] quoted above that no positive act on the part of the directors was required where the transfer in usual or common form was left for registration at the office of the company. However, what was said by his Honour at para [42] has to be read in the context of what preceded and succeeded that paragraph. At paragraph [40], Santow J said that he was satisfied that the act of registration under the articles of association would have been a purely administerial act not requiring any form or resolution on the board's part. That was so because of the position that Mr McDonald held in the company as its sole director and sole other shareholder. 21His Honour also said at para [43] that if a transfer of shares had triggered pre-emptive rights, then there might be an implication that the transfer would have to first go to the board in order that the board could fulfil its functions laid down by the articles. That was not that case. 22The present case is quite different. As Mr Studdy SC and Mr Tobin who appeared for the plaintiffs submitted, the provisions of article 34 of HCP's constitution cannot be disregarded. HCP, as they submitted, is a closely held joint venture company and the directors have a real interest in deciding whether or not to consent to the registration of the transfer. In this case the registration of the transfer purportedly had the effect of providing a quorum for a meeting of shareholders that was convened only a week after the transfer was purportedly registered. 23It is not right to say that either Mr Xu or Ms Xia had an absolute right for the transfer to be registered. Their right is a right to the proper exercise of the directors' discretion under the constitution as to whether the transfer should be registered or not. The directors have not yet been called on to exercise that discretion. 24Mr Rollinson submitted that relief under s 175 should be refused on discretionary grounds. First, he submitted that the plaintiffs had asserted that the transfer was invalid, but had relied on improper grounds for that contention. Indeed, part of the relief sought in the originating process as set out above is a declaration that the purported transfer is invalid and of no force and effect. Mr Rollinson is correct in submitting that it would be inappropriate to make that declaration. As between Mr Xu and Ms Xia, there is no reason to doubt the validity of the transfer. The transfer was given for good consideration and, prima facie, even if Ms Xia is not entitled to have the transfer registered and it is not registered, she would be entitled beneficially, as against Mr Xu, to the three shares in question. Moreover, I do not accept the contention made by Watson Mangione in their letter of 8 February 2013 that the share transfer was invalid because it was made for the purpose of allowing Mr Xu to increase the number of directors of HCP. For the reasons below in relation to the application for the injunction in paragraph 9 of the originating process, I do not accept that the orders made by Gzell J preclude the appointment of two additional directors. Nonetheless, the objection raised by Watson Mangione in their letter of 8 February 2013 that the share transfer had not been approved by the directors, or to put it more accurately, the registration of the transfer had not been approved, is sound. 25Mr Rollinson also submitted that the plaintiffs could not properly have refused their approval to the registration of the transfer. It is not appropriate to decide that question on the present application. The plaintiffs have not been called on to exercise their discretion under clause 34. It may be that the plaintiffs would not properly exercise their discretion under clause 34 if they refused to register the transfer in an attempt to preserve the position that there could not be a quorum of a meeting of members. It would be arguable that notwithstanding the reference in clause 34(1) to the directors' discretion being absolute and uncontrolled, that they must nonetheless exercise that discretion in good faith and for the benefit of the company and not for their personal advantage. It is not appropriate to express any concluded view on that question. The time for doing so has not arisen and may never arise. In any event, there may be other good grounds on which directors could properly refuse to register a transfer of shares. As I have said, the transfer was not tendered in evidence. Questions may arise as to whether or not the transfer required stamping and, if so, whether it has been stamped. Such considerations can be relevant to the exercise of the discretion under article 34. 26A further discretionary consideration that was advanced in submissions was that the board itself had not taken any steps to correct the register or to consider the exercise of the discretion under clause 34 and had delayed in commencing these proceedings. As I understood the submissions and the evidence, delay as such was not relied on and there was no evidence of prejudice as a result of the delay in commencing the proceedings. Neither Mr Xu nor Ms Xia have asked the directors as a whole, that is to say, including Ms Lu and Ms Huang, to consider the registration of the transfer. 27In my view I ought to exercise the discretion under s 175 and make an order for correction of the register. However, I would do so only on the basis that the board should now promptly consider the application for registration of the transfer. No undertakings have been proffered on behalf of the plaintiffs that they would consider the application for registration of the transfer promptly. Mr Studdy accepted that the Court would have power to make an order requiring the board to give prompt consideration to the question whether the transfer should be registered. In my view, that is an appropriate condition to the exercise of the power under s 175. Mr Studdy submitted rather that there was no need for any such order. He pointed out that it was open to Mr Xu at any time to convene a meeting for that purpose. That is true. On the other hand, Mr Xu has not done so to date and it is not open to Ms Xia to require a meeting to be convened for that purpose. 28In addition to making the order under s 175 I will make an order to require the directors to consider the application within a short period and I will hear submissions in relation to what that period should be. It is important that that step be taken so that Ms Xia is in a position where, if necessary and if so advised, she could apply for an order under s 1071F of the Corporations Act requiring registration of the transfer if the court was satisfied that a refusal to register the transfer was without just cause. The transfer must be tendered to the board for its consideration before such an application can be brought (Monardo v Complete Hardware Ltd (1990) 20 NSWLR 489). 29The defendants did not dispute that if the registration of the transfer purportedly by Mr Xu was invalid, that the appointment of Mr Thomas Xu and Ms Wang at the meeting held on 9 February 2013 was also invalid. The registration by Mr Xu was invalid for reasons I have given. 30I should add that there was no evidence that Mr Xu had any actual or implied authority from the other directors to exercise the discretion under article 34 himself on behalf of his co-directors. 31It was not argued for the defendants that it was sufficient for the appointments of Mr Thomas Xu and Ms Wang as directors to be valid that the name of Ms Xia had been entered on the register of members. Accordingly it is unnecessary to decide whether it would be necessary to make a correcting order under s 175 with retrospective effect. I should say however that if such a course were necessary, it would be appropriate. 32I will make the declarations as to the invalidity of the appointment of Ms Wang and Mr Thomas Xu as directors accordingly. 33The plaintiffs also sought orders restraining Mr Xu and Ms Wang from exercising or purporting to exercise rights, and I assume powers, as directors of HCP as a consequence of their purported appointment on or around 9 February 2013. In my view there is no need to make such orders and it may be inconvenient if such orders are made. I see no reason to think that either of them would seek to exercise powers as directors of HCP once the declarations are made as to the invalidity of their appointments. I was not referred to any evidence of a threat on their part to exercise such powers even if such declarations were made. Such injunctions could also be inconvenient. They may be reappointed as directors. That may be because, for example, the transfer of shares to Ms Xia is registered in due course either pursuant to a resolution of the directors or by an order under s 1071F. That might also occur if an application were made by Mr Xu pursuant to ss 249G and 1319 of the Corporations Act for orders for the calling of a meeting of members at which a quorum of one shareholder would suffice. (See for example In re El Sombrero Limited [1958] Ch 900; and Re Totex-Adon Pty Ltd & the Companies Act (1980) 1 NSWLR 605.) 34Again, I express no conclusion as to the likely outcome of such an application. But it should not be assumed that even if Ms Xia has not become registered as a shareholder, that the plaintiffs could simply frustrate the holding of a general meeting. 35The remaining question concerns order 9 in the originating process. 36Initially I understood the plaintiffs' submission to be that an order restraining any of the parties from appointing any further directors was justified on the same grounds on which the registration of the share transfers and the appointment of the additional directors were impugned. However, there is nothing in those circumstances which would warrant such an injunction. To the contrary, for the reasons I have given, it may well be that Mr Xu as a majority shareholder is entitled to appoint additional directors. As the argument developed, I understood the focus to be on the implications to be derived from order 5 made by Gzell J set out earlier in these reasons. 37In my view, it is not to be implied from the orders made by his Honour on 16 April 2010 that the parties are precluded from appointing any further directors to HCP. That is so for two reasons. The first is that the referee to be appointed to resolve a dispute between the plaintiffs and Mr Xu is to have such powers only in respect of disputes that relate to the course to be taken by HCP in the development of the Hurstville land. There are other things that HCP may be required to do, or its members or directors may wish to do, that would not fall within the jurisdiction of the referee to be appointed. Indeed, no referee has yet been appointed and although there is evidence that one person was prepared to accept appointment, and was purportedly appointed, he withdrew because of what was said to be a prior association with an associate of one of the parties. But it may be that the parties find difficulty in obtaining the consent of a person to be appointed as referee. That in turn might depend on the extent of the task which might be entrusted to such a person. There may be questions that a proposed referee would have to consider, such as whether or not he or she might incur liabilities under the Corporations Act in relation to decisions he or she might make. 38As I have said, there is some obscurity as to the scope of a referee's jurisdiction under order 5. This is not the appropriate time to resolve that question. But it is to be borne in mind that under the orders made by Gzell J, HCIH is the trustee of the Hurstville land that is now the subject of development and HCP is the beneficiary of that trust. It is not obvious that the beneficiary can control the exercise by the trustee of the trustee's functions concerning the development. But there may be other evidence, either that was before Gzell J, or which may be adduced in an appropriate forum that bears on that question. 39The other reason that I do not think that it is to be implied from the orders made by Gzell J that the parties cannot appoint any further directors to HCP, is that such a restraint would not be necessary, even in connection with those disputes that would be the subject of the referee's jurisdiction. Thus, if two further directors were appointed but a dispute arises between the plaintiffs and Mr Xu that is submitted to determination by the referee, his or her decision will be binding on all of those parties and they would be bound to act accordingly. That would be so, notwithstanding that two other directors might think differently. It would only be if three or more additional directors were appointed that the mechanism for resolving disputes in relation to the course to be taken by HCP in the development of the Hurstville land could break down. There has been no proposal for the appointment of more than two directors. There is no evidence that anyone proposes the appointment of more than two directors. Accordingly, I will refuse the relief sought in paragraph 9 of the originating process. 40The orders I propose are:

1. That pursuant to s 175(1) of the Corporations Act, the first defendant correct its register of members by deleting the entry of the name and address of the fifth defendant as the holder of three shares numbered 98 to 100 and by providing that the second defendant is the holder of 60 shares numbered 41 to 100.
2. That within seven days, the first and second defendants lodge notice of the correction, the subject of order 1, with the Australian Securities and Investments Commission.
3. That the second defendant serve on the solicitors for the plaintiff a copy of the notice lodged with the Australian Securities Investments Commission pursuant to order 2 forthwith, after lodging that notice.
4. Declare that the purported appointment of the third defendant as a director of the first defendant on or about 9 February 2013 was invalid as and from the date of the purported appointment.
5. Declare that the purported appointment of the fourth defendant as a director of the first defendant on or about 9 February 2013 was invalid as and from the date of the purported appointment.
6. Order that within seven days the plaintiffs and the second defendant hold a meeting of directors of the first defendant to consider whether the transfer of three shares from the first defendant to the fifth defendant should be registered.
7. Order that within 24 hours after the holding of that meeting the plaintiffs or the first defendant notify the fifth defendant of the directors' resolution on that question.
8. Order that the originating process be otherwise dismissed.
9. Order that by 15 August 2013 the second or fifth defendants serve on the solicitors for the plaintiffs a copy of the instrument of transfer of the three shares in the first defendant from the second defendant to the fifth defendant. 41I make those orders. [Parties addressed on costs.] 42In relation to costs, although the plaintiffs were only partially successful, I do not consider that the aspects of the case on which they were unsuccessful were dominant or severable matters that should alter the exercise of the costs discretion. Prima facie, costs follow the event and I think, overall, the plaintiffs have succeeded in the proceedings. An order for costs is sought only against the second defendant. I think that is appropriate and I order that the second defendant pay the plaintiff's costs. 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: 03 December 2013