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[2026] NSWSC 893
Supreme Court of NSW
2026-07-28
Pike J
Original judgment source is linked above.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Interslice Pty Ltd v CCA Investments - Bass Hill Pty Ltd [2026] NSWSC 893
Hearing dates: 24 July 2026
Date of orders: 28 July 2026
Decision date: 28 July 2026
Jurisdiction: Equity - Real Property List
Before: Pike J
Decision: (1) The $20,000 held by the Court as security for the defendant’s costs of these proceedings (and any interest accrued thereon) be released to the defendant.
(2) The plaintiff pay the defendant’s costs of the motion filed 21 July 2026.
Catchwords: COSTS — security for costs — application for release of monies paid into Court as security for defendant’s costs — plaintiff partially successful on appeal — defendant successful on costs order in relation to plaintiff’s claim — plaintiff successful on costs of cross-claim to extent separately identifiable — no costs assessment undertaken — plaintiff impecunious — evidence that defendant’s costs substantially exceed plaintiff’s likely entitlement — whether security should remain in court pending costs assessment — purpose of security for costs — release of security ordered
Legislation Cited: Nil
Cases Cited: Interslice Pty Limited v CCA Investments – Bass Hill Pty Limited [2025] NSWCA 175
Ling v Beyond Development Group Pty Ltd (No 2) [2022] NSWSC 817
Texts Cited: Nil
Category: Procedural rulings
Parties: Interslice Pty Ltd (Plaintiff)
CCA Investments – Bass Hill Pty Ltd (Defendant)
Representation: Counsel:
DM Robinson (pursuant to leave) (Plaintiff)
A Rizk (Defendant)
Solicitors:
Mitry Emerson Lewis Lawyers (Defendant)
File Number(s): 2020/00337486
Publication restriction: Nil
1 An order releasing the $20,000 held by the Court as Security for the Defendant’s costs of these proceedings to the Defendant.
2 Costs.
In support of the orders sought in the motion, CCA relies upon two affidavits of Emma Brianne Watt (Ms Watt), CCA’s solicitor made 10 July 2026 and 23 July 2026. Those affidavits were read without objection.
The plaintiff, Interslice Pty Ltd (Interslice) opposes the relief sought. In support of that opposition, Interslice relies upon an affidavit of Danka Bakic (Ms Bakic), a director of Interslice, made 21 July 2026. That affidavit was read without objection.
The motion was heard in the Real Property List on 24 July 2026. Ahmed Rizk appeared for CCA. I granted leave for David Robinson (Mr Robinson), Ms Bakic’s husband, to appear for Interslice on the motion. Mr Robinson provided helpful written submissions setting out Interslice’s position.
For the reasons set out below, I am satisfied that the orders sought in the motion should be made.
It is only necessary to provide a brief background of the relevant underlying facts.
Interslice operated a gym under the name “Move Fitness Leisure Centre”, which was located on the lower ground floor of a building located in Bass Hill. At the time the original lease was entered into, that land was owned by the City of Bankstown R & SL Community Club Limited. The land was sold to CCA in September 2019.
It was not in dispute that CCA never provided a new lease in registrable form to Interslice. Nevertheless, Interslice continued in occupation of the premises until 28 April 2020, pursuant to what the parties agreed was an equitable lease.
By early 2020, the relationship between Interslice and CCA had broken down. CCA claimed that Interslice lacked planning consent to operate a gym and asserted that Interslice was for that reason in breach of an express term of the equitable lease. Ultimately each party claimed that the other had repudiated either or both of the original lease and the equitable lease, and that the innocent party had accepted the repudiation and terminated.
Interslice commenced these proceedings against CCA, seeking a return of a bond of $30,000 and damages. CCA cross claimed, seeking arrears of rent, outgoings and other monies and damages.
On 7 December 2021, the Court made an order that:
- Order the plaintiff to provide security for the defendant’s costs by payment into Court or the provision of an unconditional bank guarantee in the following tranches:
(a) Payment of the sum of $5,000 by 31 January 2022;
(b) Payment of the sum of $10,000 on service of the defendant’s expert report as to damages or on 28 February 2022, whichever is the later; and
(c) Payment of the sum of $5,000 within 28 days of the matter being listed for hearing.
On or about 3 September 2024, Interslice paid the final instalment into Court. As such, $20,000 has remained in Court pursuant to the 7 December 2021 orders. It is this $20,000 that CCA seeks to have paid out to it by virtue of its motion.
The primary judge determined that Interslice was in breach of the equitable lease, had repudiated it, and that CCA had validly terminated it. The primary judge also held that Interslice was entitled to the return of the bond with interest, and that CCA was entitled to judgment against Interslice on the cross-claim for nominal damages of $10.
The position was somewhat reversed on appeal. The Court of Appeal held that there should be a declaration that the original lease had been validly terminated by Interslice, and that Interslice is entitled to nominal damages of $10 on account of CCA’s repudiation of the original lease. Interslice is also entitled to return of the bond plus interest.
By reason of Interslice’s claim being upheld, CCA’s cross-claim was dismissed.
As to costs, it is convenient to set out what was said by McHugh JA in the Court of Appeal in Interslice Pty Limited v CCA Investments – Bass Hill Pty Limited [2025] NSWCA 175 at [300]-[303]:
[300] As to costs, in a separate judgment the primary judge proceeded on the footing that the Tenant’s claim and the Landlord’s cross-claim were opposite sides of the same coin. The primary judge awarded the costs of the proceedings (on both the claim and the cross-claim) against the Tenant on the ground that the real issue in dispute was the question whether the Tenant’s termination of the lease was valid, and the Tenant failed on that issue. The premise of that order has been upset on appeal, and the discretion must be re-exercised.
[301] The Tenant failed both at first instance and in this Court on two issues which occupied much time and evidence: the planning consent issue and proof of substantial damages. However, the Tenant has succeeded on appeal on a third substantial issue, repudiation, and the appeal should be allowed to that extent. It is appropriate in the circumstances that each party bear its own costs in this Court.
[302] **As to the costs at first instance, in the result the Tenant’s claim has succeeded (but only to the extent of nominal damages and return of its bond), and the Landlord’**s cross-claim has wholly failed. The practical effect is that the Tenant has failed in the main object of its claim, obtaining substantial damages. That is in substance the ”event” for present purposes. On the other hand, it is difficult to see why the Landlord should not pay the Tenant’s costs of the cross-claim, to the extent that they are separately identifiable.
[303] In the circumstances (1) each party should pay its own costs in this Court; (2) the Tenant should pay the Landlord’s costs of the proceedings on the statement of claim at first instance; and (3) the Landlord should pay the Tenant’s costs of the cross-claim at first instance. There is no occasion to make costs orders with respect to the second or third cross-defendants, who submitted in this Court.
(Emphasis added.)
- Appeal allowed in respect of Ground 4.
- Set aside:
(a) declaration 1 and orders 2(b) and 3 of the orders made on 8 May 2024 by Richmond J; and
(b) orders 1 and 2 of the orders made on 23 May 2024 by Richmond J.
- In lieu thereof:
(a) declare that the lease between the defendant as lessor and the plaintiff as lessee in respect of the premises comprised in part folio identifier 101/1053893 located at lower ground floor, 330 Hector Street, Bass Hill, New South Wales has been validly terminated by the plaintiff;
(b) order that judgment be entered for the plaintiff against the defendant on the amended statement of claim in the sum of $10;
(c) subject to any costs orders already made, order that the plaintiff pay the defendant’s costs of the proceedings on the plaintiff’s claim at first instance;
(d) subject to any costs orders already made, order that the defendant pay the plaintiff’s costs of the defendant’s cross-claim at first instance;
(e) otherwise dismiss the proceedings on the amended statement of claim;
(f) dismiss the cross-claim.
- The amended notice of appeal otherwise be dismissed.
- The notice of contention be dismissed.
- There be no order as to the costs of the proceedings in this Court.
(Emphasis added.)
In her first affidavit made 10 July 2026, Ms Watt states that CCA’s total costs of the proceedings were $380,766 (excluding GST). Having reviewed the invoices and excluding the costs directly attributable to the cross-claim (including costs associated with the notice of motion to amend the statement of cross-claim in July 2022), CCA’s total costs of these proceedings were approximately $351,362 (excluding GST). Ms Watt thus estimates that the costs incurred by CCA directly attributable to the cross-claim are in the order of $29,000 (excluding GST).
At [23] of her affidavit made 10 July 2026, Ms Watt stated:
The majority of the work involved in these proceedings related to issues which arose on the Plaintiff’s claim. The cross-claim concerned a narrow issue relating to an allegation that in purporting to terminate the lease, the Plaintiff had repudiated the lease and the quantum of damages said to arise on the alleged breach.
There was no challenge to any of this evidence.
Mr Robinson for Interslice indicated that he did not propose to put any evidence before the Court on this application as to the likely quantum of Interslice’s costs order in relation to the cross-claim.
It was also not in dispute between the parties that neither party has proceeded to a costs assessment in relation to their respective costs orders. It was also not in dispute that the two costs orders would need to be set off at the end of the day.
The effect of Ms Watt’s second affidavit, which again was not challenged, is that Interslice is impecunious. There was no suggestion that CCA is impecunious.
CCA’s essential position on the motion was that the costs order which it has the benefit of against Interslice is substantially greater than the costs order which Interslice has the benefit of against CCA. This is in circumstances where Ms Watt estimates the costs order which CCA has the benefit of as amounting to several hundred thousand dollars and there is no evidence from Interslice as to the quantum of the costs order in its favour. Coupled with this is the comments made by McHugh JA in the Court of Appeal to the effect that the major issues in the proceedings, both at first instance and at appeal, concern Interslice’s claim. Further, the costs order in Interslice’s favour was only in respect of the costs of the cross-claim to the extent that they were separately identifiable from the costs of the main proceedings.
In circumstances where it is clear that Interslice is impecunious, the reality is that the $20,000 presently held in Court as security for CCA’s costs is likely to be the only money that CCA will see to satisfy the costs order in its favour. Accordingly, there would be little utility in requiring the parties to proceed through separate costs assessments before determining the present application. On the evidence, the costs recoverable by CCA will substantially exceed the $20,000 and there will be no money within Interslice to pay it.
Furthermore, there is no suggestion that, if a net amount were ultimately found to be payable by CCA to Interslice following set off, CCA would fail to satisfy that liability.
Interslice opposed the motion on the basis that the parties should first proceed to costs assessment so that the net amount payable after set off can be determined. It contended that there was no prejudice to CCA if the monies remained in Court for this to occur.
[62] Rules 41.3 and 41.8 of the UCPR deal with the release of amounts paid into Court and interest accrued thereon. Here, the release is sought by way of a partial discharge of the plaintiffs’ liability pursuant to the costs orders made at the time of the principal judgment (and now left undisturbed).
[63] The general principles applicable where there is an application for payment out of funds held in Court (such as disputed trust funds) were considered by Slattery J in Commonwealth Bank v Estate of late Slieman [2010] NSWSC 661 (see ([8]ff) and Chong v Super Equity Invests Pty Ltd [2012] NSWSC 27 at [12]); In the matter of C & L Cameron Pty Ltd - GB Gazzana v Nadalan Enterprises Pty Ltd; AF Gazzana v Nadalan Enterprises Pty Ltd [2012] NSWSC 676. What is required on such an application is that the applicant establish: the identity of the person primarily entitled to the funds and the basis of that entitlement; that the applicant is not merely an unsecured creditor but has a beneficial interest in the fund paid into court; and the identity of other potential claimants and their entitlement to the fund (and that they have been notified).
[64] Where funds have been paid into Court as security it has been recognised that property remains with the person providing the funds (see Summer Hill Business Estate Pty Ltd v Equititrust Ltd [2011] NSWCA 211 (Equititrust) at [24] per McColl JA); and it has been suggested that, pending the resolution of the dispute and the making of a costs order, such property is subject to a right of the party whose interest is secured in the nature of an equitable charge or lien ”giving a right of recourse to the fund to satisfy the terms of the judgment, that is, to secure reimbursement if an order for costs be made in his or her favour” (see Equititrust).
[65] At least where there have not been agreed limitations or conditions on the release of funds held as security for costs, there is a general discretion as to the release of funds held as security for costs (see Thomson v Golden Destiny Investments Pty Ltd (No 2) [2015] NSWSC 1929 at [151] per Sackar J).
[66] In the present case, the substantive dispute has been determined and an order has been made in Mr Pang’s favour in respect of costs. Therefore, the right of recourse to the fund to satisfy the costs order has arisen. The fact that for Mr Pang to enforce that costs order (in the absence of agreement as to costs) would require him to complete the costs assessment process does not to my mind affect the position that he now has an entitlement to those funds in accordance with the costs order. The only issue of contention could be the quantum of the recoverable costs on the ordinary basis.
[67] The evidence makes abundantly clear that the costs and disbursements incurred by Mr Pang, when assessed on the ordinary party and party basis, will almost certainly exceed the amount that is held in Court as security. In other words, even if there were to be a limitation on the amount recoverable for Counsel’s fees and expert witness fees in a greater amount than is the ordinary experience on a costs assessment (since one would ordinarily assume that those fees unless unreasonably incurred would be recoverable almost in full), and even taking into account the usual contingencies that may arise in the assessment process (for which a discount of, say, 10% might be allowed by analogy with the usual such allowance on gross sum costs order applications), the sum paid into Court and any interest accrued thereon is most unlikely to exceed the amount recoverable on a party and party assessment of Mr Pang**’s costs and disbursements. In those circumstances, it may comfortably be expected that there will be no amount repayable to the plaintiffs out of the funds held as security (rather, it is highly likely that there will be a shortfall to be met by the plaintiffs in respect of Mr Pang’s costs)**.
[68] In those circumstances, where there is evidence that the amount of costs incurred by Mr Pang exceeds the total amount of the funds paid into Court and, in my opinion, does so by a sufficient margin to make it highly unlikely that the costs as assessed would ultimately be reduced to below the total sum of the security (and any accrued interest), I consider that it is appropriate that the security and any accrued interest now be released to Mr Pang (see 123 259 932 Pty Ltd v Cessnock City Council (No 4) [2021] NSWSC 1598 at [6]-[9] per Adamson J; Jin Lian Group Pty Ltd (in Liq*) v* ACapital Finance Pty Ltd (No 2) [2021] NSWSC 1202 at [74] per Stevenson J).
[69] It is relevant in this context to note that no issue has been raised concerning the ability of Mr Pang to repay any or all of the security so released if it were ultimately to be found on a costs assessment that he has been paid more than the assessed costs (and if that had been such a concern then it could have been met by the seeking of an appropriate undertaking as to retention of the funds).
[70] I see no reason for Mr Pang to continue to be out of pocket for his costs and disbursements of the proceeding when the purpose of the order for security for costs was to provide him with just that – security. In those circumstances, I consider that it is consistent with the just, quick and cheap resolution of the real issues in dispute that the sum paid into Court as security for Mr Pang’s costs (and any accrued interest thereon) be released to Mr Pang in partial satisfaction of the costs order that has been made in his favour.
(Emphasis added.)
On the evidence before me the facts are relevantly quite similar to those considered by the learned President in Ling.
On the evidence, I am comfortably satisfied that there will be a substantial net amount owing to CCA if a costs assessment process is required to be gone through in relation to the two costs orders made by the Court of Appeal. CCA has put on evidence to demonstrate that its costs, which Interslice is liable to pay, are substantial. Interslice has chosen not to place any evidence before the Court as to the quantum of its costs.
The nature of the underlying proceedings suggests quite strongly that the costs order in CCA’s favour is likely to significantly outweigh the costs order in Interslice’s favour.
Perhaps more importantly, there is no suggestion that, if costs were assessed and, contrary to my present assessment, a net amount were found to be payable by CCA to Interslice following set off, CCA would fail to repay any or all of the security so released.
As Ward P observed in Ling, I see no reason why, in the present case, CCA should continue to be out of pocket for its costs and disbursements of the proceedings when the purpose of the order for security for costs was to provide it with just that – security. I consider that it is consistent with the just, quick and cheap resolution of the real issues in dispute – that the sum paid into Court as security for CCA’s costs (and any accrued interest thereon) be released to CCA in partial satisfaction of the costs order that has been made in its favour.
Accordingly, the Court orders that:
The $20,000 held by the Court as security for the defendant’s costs of these proceedings (and any interest accrued thereon) be released to the defendant.
The plaintiff pay the defendant’s costs of the motion filed 21 July 2026.
**********
Interslice Pty Ltd
CCA Investments - Bass Hill Pty Ltd