Kelly v Willmott Forests Ltd

Federal Court of Australia|2013-07-26|Before: Mr J, Murphy J

Number of paragraphs: 62

Counsel for the Applicants: Mr J W K Burnside QC and Mr R L Moore

Solicitor for the Applicants: Macpherson and Kelley Solicitors

Solicitor for the First and Seventh Respondents in VID 1485 of 2011: Arnold Bloch Leibler

Counsel for the Second, Third, Fourth, Fifth and Sixth Respondents in VID 1485 of 2011: Mr J Delany SC and Ms C van Proctor

Solicitor for the Second, Third, Fourth, Fifth and Sixth Respondents in VID 1485 of 2011: Brian Ward & Partners

Counsel for the Respondents in VID 1483 of 2011 and VID 1484 of 2011: Mr B F Quinn SC and Mr A Di Pasquale

Solicitor for the Respondents in VID 1483 of 2011 and VID 1484 of 2011: Herbert Smith Freehills

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1483 of 2011

AND: MIS FUNDING NO 1 PTY LTD (ACN 119 268 905)

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1484 of 2011

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1485 of 2011

AND: WILLMOTT FORESTS LTD (IN LIQUIDATION) (ACN 063 263 650)

BIOFOREST LIMITED (IN LIQUIDATION) (ACN 096 335 876)

JUDGE: MURPHY J DATE: 26 JULY 2013 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 In these three related class actions arising out of a number of failed managed investment schemes ("the schemes") the respondents seek security for costs. On appeal from my decision refusing to order security (Kelly v Willmott Forests Ltd (in liquidation) [2012] FCA 1446 ("Kelly v Willmott")), the Full Court held that an order for some security is appropriate given the nature of the underlying claims and the "proved ability of at least a not insignificant number of group members to contribute" to a fund for such a purpose: Madgwick v Kelly [2013] FCAFC 61 at [91] ("Madgwick") per Allsop CJ and Middleton J. 2 The application was remitted to me as the docket judge with orders requiring that I fix the amount of security and the manner and terms of its provision. Allsop CJ and Middleton J held at [99] - [100] that: (a) it was fair that the group members standing to benefit from the proceedings make a real, but not oppressive, contribution to a pool of funds for security; (b) the most obviously fair and appropriate approach would be to calculate each group member's contribution rateably by reference to their investment in the schemes; (c) there would be a need in setting the amount of security not to risk stifling the proceedings; (d) it was preferable that I, as the docket judge, formulate a view as to an amount of security that was fair in all the circumstances; (e) the amount and the staging of the security may be affected by case management considerations; and (f) although the parties had ample opportunity to present evidence and argument already, it was a matter for me whether to accede to an application to reopen the case.

the parties and the group members 3 The applicants in the three proceedings, who are to be subject to the order for security, are three natural persons of means. However, it is uncontroversial that they will be unable to meet the very significant costs that will have been incurred by the respondents if the class actions are unsuccessful. For that reason the Full Court decision contemplates the order for security being primarily met through contributions from the group members. 4 The three class actions involve a large but unknown number of group members. There are up to 3,191 persons who had acquired interests in the schemes, all of whom may possibly be group members ("the unidentified group members"). Presently, the number of those persons who claim to have suffered losses by reason of the respondents' alleged wrongful conduct is unknown. 5 409 of those who claim to have suffered loss have identified themselves by instructing Macpherson and Kelley, the solicitors for the applicants, to also act for them ("the known group members"). The known group members represent about 12.8% of the total number of possible group members. 6 The three related class actions and the three groups of respondents are described in my earlier judgment: Kelly v Willmott at [2]. The groups of respondents are: (a) the five former directors of Willmott Forests Ltd ("the Directors"), being respondents in VID 1485 of 2011 ("the Willmott Proceeding"); (b) the two Willmott companies involved in the relevant schemes ("the Willmott Respondents"), being respondents in the Willmott Proceeding; and (c) the two financiers (the Commonwealth Bank and a wholly owned subsidiary) that financed various group members' acquisition of interests in the schemes ("the Lenders"), being respondents in VID 1483 of 2011 ("the MIS Proceeding") and VID 1484 of 2011 ("the CBA Proceeding").

The quantum of the security sought 7 The respondents updated claims for security are as follows: (a) the Directors seek security of $2 million, with $1.1 million to be paid within 14 days and the balance of $900,000 paid shortly before trial; (b) the Willmott Respondents seek security of $1,183,876, with about $578,000 to be paid within 30 days and the balance of about $606,000 paid shortly before trial; and (c) the Lenders seek security of $3.4 million, with about $3.15 million to be paid presently and the balance of $250,000 paid shortly before trial. 8 Expressed in a table, with some small rounding of the numbers, the security sought is as follows: Security payable now Further security payable pre-trial Total security sought Directors $1.1 million $0.9 million $2 million Willmott Respondents $0.58 million $0.6 million $1.18 million Lenders $3.15 million $0.25 million $3.4 million Total $4.83 million $1.75 million $6.58 million

9 I will treat the respondents' applications for security on a global basis. I can see little utility in treating and considering the claims separately in the circumstance that there will be a total body of security to be put forward, and no respondent has priority over another in regard to their defence costs: see Madgwick at [74] per Allsop CJ and Middleton J. 10 While there were some differences in detail and in emphasis in the submissions made by the different groups of respondents, none disagreed with the submissions of the others. For convenience I have therefore tended to group the submissions of the respondents together, rather than treat them separately. 11 The respondents' estimates of their recoverable costs incurred and to be incurred is uncontested. My starting point is therefore that security for costs in the sum of $6.58 million should be ordered subject to the risk that such an order would stultify the proceedings.

the hearing of the remitted application on 18 july 2013 12 There was disagreement between the parties as to the nature of the hearing on 18 July 2013. Shortly following the decision of the Full Court being handed down, the solicitors for the Directors requested by email (copied to all parties) that the remitted applications be listed for directions, and they were. On 28 June 2013 the solicitors for the Willmott Respondents advised by email, also copied to all parties, that the parties had agreed that the applications should be listed for hearing rather than directions. My chambers then emailed the parties querying the request for a hearing date and asking for an indication as to whether the Court should receive further evidence to assist in assessing the quantum of security, the contribution to be made per group member, and the staging of the payment. In response to that request it became apparent that the parties took quite different views as to the nature of the hearing to be conducted, and as to whether any further evidence should be adduced. Ultimately the applicants approached the hearing on the basis that the remitted applications were listed for directions only, whereas the respondents sought that the applications be heard and determined on that day.

The respondents' contentions 13 The respondents submit that the quantum of security should be fixed by reference to the financial characteristics of only the known group members, and that the contributions be rateable. The decision of the Full Court that an order for security was appropriate was made by reference to the financial characteristics of the known group members only. Allsop CJ and Middleton J accepted that there was force in the proposition that it was impossible to show the financial capacity of the unidentified group members: Madgwick at [64]. 14 The respondents strongly contend that there is sufficient evidence before the Court to enable, indeed require, a determination of the quantum of security now. The evidence includes that: (a) 158 known group members with loans from one Lender had average net assets of $1.38 million and an average gross annual income of $234,562; (b) 218 known group members with loans from the other Lender had average net assets of $582,507 and average gross annual income of $157,134; (c) nine known group members had interests in the scheme in excess of $500,000, and net assets of over $1 million; (d) the known group members had invested $42.25 million in the relevant schemes, and the amount of their claims in the proceedings are larger still because of their claims for interest and damages for lost opportunity; and (e) the known group members who borrowed monies from the Lenders had net assets of approximately $209 million between them and gross annual income of approximately $50 million. 15 The evidence is that the significant majority of known group members - about 362 on my rough calculations - are group members in both the Willmott Proceeding and one or other of the MIS Proceeding or the CBA Proceeding. The respondents contend that, if the order for $6.58 million of security is made, each such a group member will be required to make a contribution of: (a) about $5,101 (or a slightly lower figure if the calculations of the Lenders are accepted) if the group member's investment is the most common or "mode" amount of $42,400; or (b) about $12,430 if the group member's investment is the "average" amount of $103,311. There are some investors who are group members in each of the three proceedings, and the contribution for them will therefore be higher. However, the number of such group members appears to be quite low. 16 The respondents submit that, if security of $6.58 million is ordered, a rateable contribution from each of the known group members would result in a payment of only about 7.9% of the amount that each group member claims in the proceedings. They accept that this is an indicative calculation only, which may be 2-3% higher, but they argue that it will not be substantially more. They argue that contributions of this magnitude should not be treated as oppressive in the circumstances of these proceedings. This submission has some force. 17 The respondents note also that a "mode" investor who paid for the investment upfront paid $42,000 at that time. If the investor borrowed money from one of the Lenders to finance the acquisition he or she was required to repay the loans within one to fifteen years and must have considered that payments of between $7,400 per annum and $42,000 in any one year was within his or her means. They say this too indicates that the contribution that they seek from the known group members is not oppressive. 18 They also reiterate, and I accept, that the applicants have the burden of proving stultification. They argue that, insofar as the evidence is insufficient to establish that the order for security will stultify the group members' claims, the applicants have failed to discharge their onus. Therefore they submit that the order for security should be made in the quantum sought.

The applicants' contentions 19 Taking the approach that the hearing was properly a directions hearing, the applicants do not directly deal with many of the respondents' contentions. Instead they submit that the evidence before the Court as to the capacity and/or willingness of group members to make a contribution to a pool of funds for security is such that it is presently inappropriate to fix the total quantum of the security. They point to the fact that the evidence previously proffered by them was limited to a sample of 50 Macpherson and Kelley clients, which was evidence from only 12.2% of the 409 known group members, and only 1.5% of the all possible group members. They note that the respondents successfully criticised this sample evidence before the Full Court on the basis, amongst other things, that the information obtained from the group members related to their preparedness to make a fixed flat contribution of either $20,000 or $30,000 rather than a contribution calculated rateably. 20 The applicants effectively submit that further evidence is desirable as to the capacity and/or willingness of group members to make a contribution to a fund for security, and that it is important that this be from both the unidentified and the known group members. They reject the respondents' contention that security should be considered by reference only to the 409 known group members, and contend that it is appropriate that they obtain whatever contributions they can from the unidentified group members. 21 Accordingly the applicants seek a regime allowing them to send letters to all group members seeking a rateable contribution to a pool of funds for security. In pursuit of that approach Macpherson and Kelley wrote to the solicitors for the Willmott Respondents on 8 July 2013, seeking access to the grower registers and information to identify the names, addresses and investment quantum of all group members. The Willmott Respondents refused to provide the access sought. 22 The applicants did not seek to reopen the application for security at the hearing before me. They say that if their request that group members contribute to security meets with sufficient success then there will be no necessity to adduce any further evidence. However, they say that they may need to lead further evidence if they fail to obtain sufficient security, but obtain relevant further evidence as to the ability and willingness of both the unidentified and the known group members to make a contribution to security.

Consideration 23 In fixing the quantum and terms of security I must properly case manage these complex proceedings which are in the midst of a pre-trial timetable. I must balance the risk of injustice to the respondents in having no real capacity to recover from the applicants the cost of successfully defending the proceedings, against the risk or likelihood of stultification if security is set unfairly or too high. 24 As the order for security necessarily involves contributions from group members to a fund, it must be fixed in an overall amount which will require the group members to make a real but not oppressive contribution. My evaluation of the risk of stultification must be a broad one, and cannot descend to a detailed analysis of each group member's financial characteristics, but it nevertheless remains a difficult task. While there is evidence, as the Full Court found, that a not insignificant number of the known group members have the capacity to advance security, there remains a quite incomplete picture as to the ability and/or willingness of all group members to make the required contribution. The information deficit includes: (a) gaps in the evidence as to the financial capacity of many the 409 known group members to contribute to security, and the fact that little is known as to their willingness to contribute; (b) that the known group members make up a small proportion only of the total possible group members; and (c) more significant gaps in the evidence as to the financial capacity of the unidentified group members to contribute to security; and the fact that nothing is known as to their willingness to contribute. 25 The respondents seek that I fix the total quantum of security in the sum of approximately $6.58 million, and order that approximately $4.83 million be payable within 14 to 30 days. They seek a stay if this first stage payment is not made. 26 As I indicated during the hearing, the Full Court has ordered that security be provided, and I consider that, given the costs involved in these cases, the security must be substantial. If the rateable contributions per known group member are, as the respondents state, in the range of $5,101 or $12,430 (depending on whether one uses the mode method or the average method), then it may be accepted that they are unlikely to be oppressive to most known group members. My starting point is that an order for $6.58 million should be made comprised of $4.83 million security for pre-trial costs and the balance of security for the trial costs. 27 However, the amount of the contribution required to meet the total security fixed will increase if a significant number of known group members indicate an inability or unwillingness to contribute. In my view it is likely that some known group members will be financially able and willing to make such a contribution, and others will be unable or unwilling. While the evidence to which the respondents refer provides some insight into the financial position of the known group members it does not assist in indicating how many are willing to make such a contribution. It is therefore impossible to know whether the rateable contributions from each known group member in the range stated will in fact meet the $6.58 million sought. It depends on how many of the known group members agree to contribute. That is, the respondents' contention that fixing security at $6.58 million will require contributions in the range stated is based on premise that all known group members will contribute, when it cannot be known how many will. 28 Further, I do not accept the respondents' contention that the question of quantum or stultification should be determined having regard only to the financial circumstances of the identified group members. There is sense to the applicants' submission that they should be allowed to seek rateable contributions to security from the unidentified group members. If some contributions to a fund for security can be obtained from the unidentified group members the rateable contribution required from each of the known group members will be lower and more likely to be made. The risk of stultification will be reduced. 29 I also consider that there may be some unfairness within the class if only the 409 known group members are called on to make contributions to security, and the other group members have a free ride. While this unfairness may eventuate in any event because the unidentified group members largely refuse to contribute, it is better that the risk of unfairness be addressed as far as possible. 30 However, as the Full Court decision indicates, if the unidentified group members largely refuse to contribute to security, then the quantum of security will fall to be determined by reference to the capacity and willingness to contribute of the known group members. The Full Court has already found that the financial capacity of the known group members justifies an order for some security. 31 Contrary to the respondents' submissions, I consider that evidence from both known and unidentified group members as to their willingness to make a contribution may be of assistance in deciding the application. In this regard the respondents point to the observations of Jessup J in Madgwick at [160] who held that the question of ability to provide security turns on an objective assessment of the group members' financial circumstances, rather than on a subjective assessment of what they say they can afford. They argue that the only evidence that could be of potential significance to my decision to fix security would be objective evidence of each group member's assets and liabilities, akin to a Statement of Financial Affairs. 32 However, the majority in Madgwick took a different view at [82]-[83]. Their Honours considered that a group member's unwillingness to contribute is a relevant factor in fixing security, although the reasonableness of such unwillingness must be considered in determining what is fair in resolving the competing interests. In fixing security I consider that there is some point to knowing whether group members are prepared to contribute, although an unreasonable refusal to contribute is likely to be given little weight in the balance. 33 In all the circumstances I consider it appropriate that the applicants seek rateable contributions from as many group members as are prepared to contribute, so as to minimise the risk of stultification of the proceedings. 34 If the applicants are to request group members to make rateable contributions to security it is important they do so at a point when security has either been fixed or otherwise indicated by the Court. To maximise the prospect that the group members understand the significance of the applicants' request, they should be informed of the quantum of security ordered (or to be ordered), its staging, and the likelihood that the proceedings will be stayed if security is not met. The applicants submit, and I accept, that if the quantum of security is fixed at present this should be subject to liberty to apply for variation of the amount. This is so because it may eventuate that the Court is asked to consider reducing security to a lesser amount because a large number of group members have refused to contribute and the required contribution of the remaining group members would otherwise be oppressive. 35 I accept that the respondents have raised some legitimate concerns regarding the expense, delay, and inconvenience suffered because of the applicants' failures to put on the evidence of stultification in a timely manner. The applicants put on no evidence of stultification until I invited such evidence on the first day of the initial hearing, and then put on sample evidence that the Full Court held was insufficient. The respondents now criticise the applicants' failure to take steps to gather evidence of the capacity and willingness of the known group members between the date of the Full Court decision and the hearing before me. They argue that this is another reason to reject the approach for which the applicants contend. 36 While this submission has some merit, I take into account that the applicants' representatives were in somewhat uncharted waters as to the evidence that should be adduced in relation to the group members' capacity and willingness to contribute in an application for security in class actions like these. As I said in my earlier judgement, the parties were unable to take me to any reported decision in which security for costs has been ordered in comparable circumstances. Given the undeveloped state of the authorities regarding security for costs from group members in open class actions the applicants' difficulty is more understandable. 37 Now that the Full Court has given some guidance on this question, I consider that the applicants should be given the opportunity to adduce appropriate evidence. In reaching this view I am partly informed by the representative nature of the proceedings. The unidentified group members stand to benefit from the class actions, but they have no control over the conduct of the proceedings or over the applicants' legal representatives. Even if it was established that there was a significant failure on the part of the applicants' representatives, I should be careful about whether that failure has the effect of stultifying the unidentified group members' claims. 38 I am concerned about further delay in resolving the application for security and the orders I propose should not lead to lengthy delay in the scheme of things. In fact, the most recent cause of delay arises from the Willmott Respondents refusal to allow the applicants access to the grower registers and information they requested in their letter dated 8 July 2013. 39 I presently intend to make orders in the form set out below. However, as these have not been the subject of discussion with the parties I will hear from the parties as to the form of the orders in a case management conference. The orders I propose are as follows: 1. I direct that the solicitors for the applicants write to each of the unidentified group members by [insert date] informing them that: (a) the Court has directed that the solicitors advise each such group member that the Court intends to fix security for costs to be paid by the applicants and group members in the sum of $6.58 million; (b) the Court intends to order that the security be paid in three stages, namely $2.83 million by 30 September 2013, $2 million by 27 January 2014, with the remaining $1.75 million paid 14 days before trial (presently fixed for 2 June 2014). (c) the $6.58 million security the Court intends to order has been set by reference to the likely financial capacity of the group members who stand to benefit from the proceedings if successful; (d) the Court has directed that the solicitors be permitted to contact each such group member to: (i) request their response by [say 14 days after letter] as to whether they are prepared to make a specified contribution to a fund for security for costs, such contribution to be calculated rateably by reference to their investment in the relevant managed investment schemes; and (ii) request that any group member who refuses to make a contribution to a fund for security for costs advise the reason for that refusal and, if the refusal is based on an asserted inability to make the contribution, to request that they provide some evidence of that inability. (e) the solicitors inform the group member that if the security for costs ordered is not paid, it is likely that the Court will stay the proceedings. 2. Upon receipt and collation of the responses of the unidentified group members by the solicitors for the applicant, I direct the solicitors to write to each of the known group members by [say 10 days after the date for receipt of responses from the unidentified group members] informing them of the same matters as set out in order 1(a)-(e) and requiring their response in 14 days. 3. That the application for security be listed for directions approximately 14 days after the date set for the receipt of responses from the known group members. 4. Liberty to apply. 40 It may be appropriate for the applicants, in setting out the rateable contribution to be sought from each group member, to approach that task with an acceptance that some percentage of those group members will be unable or unwilling to contribute to security. In taking account of that likelihood they may choose to increase the rateable contribution to be sought from the other group members.

Partial security? 41 For the avoidance of doubt I record that I do not intend by these proposed orders to rule out the possibility that I ultimately order only partial security. The possibility of such an order was contemplated by the majority in Madgwick at [96]. I presently intend that security totalling $6.58 million be provided through rateable contributions made by the applicants and group members. However, it is not beyond the realms of possibility that an insufficient number of group members are able or willing to make the required rateable contribution and the $6.58 million is not reached. In those circumstances it is possible, although I do not presently so decide, that an order for a reduced amount of security may be appropriate. Any such decision is a matter for determination on the evidence before me should that situation arise.

Staging 42 I consider that the security ordered should be staged over three payments, rather than the two payments which the respondents seek. Taking the stance that they did the applicants made no submissions on this issue, but it is more likely that the group members will be able and willing to make their rateable contribution if they given increased time to pay. It is difficult to see any significant prejudice to the respondents in this approach. While under the orders I propose the respondents will wait longer for the whole of the initial $4.83 million that they seek, the proposed orders contemplate that they have the benefit of $2.83 million security by 30 September 2013, and the balance in January 2014. The $4.83 million relates to pre-trial costs some of which are being incurred now, but the trial is not listed to be heard until 2 June 2014 43 The proposed orders also provide for payment of $1.75 million security for the cost of the trial to be paid 14 days prior to trial. The proposed order represents no change from the respondents' request.

Stay 44 On the respondents' submissions, the proceedings should be stayed unless the applicants and known group members contribute $4.83 million within 14 days. I do not accept that this is appropriate. 45 It appears that the known group members have not even been informed that security for costs will be sought from them, let alone given time to take advice and make a decision as to whether to contribute to it. If they decide to contribute, they should be provided a short time to arrange their affairs to make such a payment. 46 In these circumstances it is unreasonable to expect the applicants to be able to gather rateable contributions from the 409 known group members within 14 days. These considerations are even more clear in relation to the unidentified group members as, until the grower registers are provided, their names, addresses and investment size are unknown the applicants. 47 As I have said, the applicants should have the opportunity of contacting the unidentified group members to try and obtain rateable contributions from them. In the end, having access to a broader pool of contributors to security will increase the likelihood of the sum proposed to be ordered being achieved thus alleviating the potential for injustice to the respondents and oppression to the applicants and group members. 48 Further, if a stay is now granted and the group members are later able to provide security, the interlocutory timetable towards trial may already have been badly delayed. Given the complexity of the cases, the number of parties and the relatively tight timetable to trial, case management considerations point away from a stay at present. Thus the proposed orders allow further time before a stay should be considered.

Other possibilities 49 In the event that a substantial number of group members make the required rateable contribution but a sufficient number do not, other questions may arise. These include: (a) whether proceedings brought for the benefit of the applicants and group members, who have provided contributions to security considered to be adequate should be stayed, in effect because other group members have not; and (b) whether group members who have not provided contributions to security should be excised from the represented class. So far as I am aware, no Australian court has made an order staying proceedings in circumstances where a substantial number of group members have made the required contributions to security but others have not, or excised from the class those group members who do not provide a contribution to security. Determination of any such issues in the proceedings, should they arise, will require careful reflection.

Reopening the case? 50 The respondents argue that there is no basis to allow the applicants to reopen the application for security so as to call further evidence: see Smith v NSW Bar Association (1992) 176 CLR 256 ("Smith") at 266-267 per Brennan, Dawson, Toohey, and Gaudron JJ; Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd (2013) 296 ALR 465 at [42] per North, Cowdroy and Katzmann JJ; Sobey v Nicol and Davies (2007) 245 ALR 389 ("Sobey v Nicol") at [68]-[74] per Branson, Lindgren Besanko JJ; and Watson v Australian Community Pharmacy Authority and Others (2012) 206 FCR 365 at [113]-[116] per Lander, Jessup and Foster JJ. 51 However, no application to reopen is made at present. On the applicants' submissions any such application is premature, as until they can approach the unidentified group members to ascertain what contributions they might be able or willing to make to security, they cannot know whether they will need to put on further evidence or not. I accept that the applicants cannot ascertain whether the unidentified group members are prepared to make rateable contributions to security unless they are provided with their names, addresses and the quantum of their investment. 52 They submit, and I accept, that if it proves possible to obtain the amount of security fixed from some combination of the known and the unidentified group members, then there will be no requirement to put on further evidence. They submit that it is only if it proves impossible to obtain that security ordered (or to be ordered) that they may seek to put on further evidence regarding stultification. Although this approach involves some further delay in the resolution of the application, in my view there is much to commend it. 53 The respondents also argue that because the onus is upon the applicants to establish stultification, in the absence of an application to reopen I am required to determine the application on the evidence as it is now. They argue that if it later eventuates that the group members are unable or unwilling to provide security then the applicants can return and seek a variation to the security ordered. They contend I would be acting outside power to take any other course. 54 It is strictly unnecessary to decide this question at present as there is no application to reopen before me, and the applicant has not made submissions on the point. I do not decide the question, but because my proposed orders may lead to an application to reopen at some point in the future, I will set down some preliminary views on the issue. 55 First, I am not inclined to accept that my power is as limited as the respondents contend. While the appeal rules relating to fresh evidence may provide a useful guide as to the manner in which the discretion to reopen should be exercised (see Smith at 267), it is difficult to see those authorities as particularly apposite to the present application. Each of the authorities relates to an attempt to reopen the evidence in an appeal. It is well established that the issues between the parties should ordinarily be dealt with at trial, so that the main arena of disputes does not move to the appellate court: Coulton v Holcombe (1986) 162 CLR 1 at 7 per Gibbs CJ and Wilson, Brennan and Dawson JJ; Sobey v Nicol at [72]. There can be little doubt that this policy lies behind the authorities relied on by the respondents. 56 The situation before me is quite different. In the present proceedings the assessment of the quantum and staging of security has been remitted to me by the Full Court. It is significant in my view that the Full Court was requested to determine these issues itself, on essentially the same evidence as is presently before me, yet it declined to do so. It referred the question to me as the docket judge expressly acknowledging the possibility that I may accede to an application to reopen: Madgwick at [100]. 57 Secondly, as the Full Court recognised, I have a responsibility to case manage these complex proceedings and am in the best position to do so. I must do so pursuant to s 37M of the Federal Court of Australia Act 1976 (Cth), by having regard to the overarching purpose of facilitating a just resolution of the dispute as quickly, inexpensively and efficiently as possible. Without significant further delay, I consider that the proposed orders allow me to better balance the competing interests of the respondents and those of the applicants and group members. 58 Finally, although I do not now decide the question, it seems that if the applicants later seek to adduce evidence as to the ability and willingness of the unidentified group members to make a contribution to security, this is likely to be "fresh" evidence that was unavailable previously. The Willmott Respondents previously refused to provide the necessary information to enable the applicants to contact the unidentified group members. 59 Fairness between the parties and case management considerations indicate that it is not presently appropriate to fix the security, and that instead a short regime should speedily commence (which will take about 4-6 weeks) so as to provide the applicants with an opportunity to seek rateable contributions to security from the unidentified group members (and then the known group members), and obtain any explanation proffered by the group members for any refusal to contribute.

Conclusion 60 On 18 July 2013 I made orders requiring the Willmott Respondents to provide the grower registers and other information to the solicitors for the applicants so that they could contact the unidentified group members seeking contributions to security for costs. 61 At the same time, on the basis that they were ultimately unsuccessful in the Full Court and there was no reason why costs should not follow the event, I ordered the applicants to pay the respondents' costs of the hearings of the security application before me. 62 At [39] I have set out the further orders which I propose to make, subject to hearing the parties as to their form at a case management conference. My chambers will be in contact with the parties shortly to organise an early date for that conference. I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy.

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