[2025] NTCA 9
General information, not legal advice.
Court of Appeal (NT)
2025-09-04
Grant CJ, Huntingford J, Riley AJ
Original judgment source is linked above.
COSTS - Security for costs - Legal nature of the plaintiff - Plaintiff is a company - Relevant factors - Impecuniosity - Timing
Whether error in determining reason to believe that plaintiff corporation unable to pay defendant's costs if defendant successful - Evidence sufficient to establish prima facie case that plaintiff would be unable to pay defendant's costs if successful - Evidentiary burden shifted to plaintiff to establish it would be able to pay defendant's costs - Bald assertions in affidavit evidence insufficient for that purpose - Sufficient estimate of the defendant's costs made to determine threshold issue - Whether error in exercise of discretion to order security for costs - Governed by principles in House v The King - No material error in findings of fact - No error in taking into account considerations - No error of principle - Decision not "unreasonable or plainly unjust" - No error in assessment of quantum - Application for leave to appeal allowed and appeal dismissed.
Corporations Act 2001 (Cth) s 1335
Supreme Court Rules 1987 (NT) r 62.02
Anchung Pty Ltd v Northern Territory of Australia [2015] NTSC 76, Arnold v Queensland [1987] FCA 148; (1987) 73 ALR 607, Attorney-General (Botswana) v Aussie Diamond Products Pty Ltd [2009] WASC 299, Bailey v Beagle Management Pty Ltd [2001] FCA 60; (2001) 182 ALR 264, Beluga Developments Pty Ltd v Sobel Investments Pty Ltd [2010] VSC 303, Buckley v Bennell Design & Constructions Pty Ltd (1974) 1 ACLR 303, Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65; (2014) 98 ACSR 301, DGR Global Ltd v PT Limited [2025] QCA 122, Drumdurno Pty Ltd v Braham [1982] FCA 161; (1982) 42 ALR 563, Green v CGU Insurance Ltd [2008] NSWCA 148; (2008) 67 ACSR 105, Hydrocool Pty Ltd v Hepburn (No 2) [2010] FCA 285, Jazabas Pty Ltd v Haddad [2007] NSWCA 291; (2007) 65 ACSR 276, Mannix Electrical Pty Ltd v Belport Pty Ltd [2019] SASC 159; (2019) 134 SASR 438, Octocane Pty Ltd v SRJ Property Development Pty Ltd [1999] SASC 231, Rimhart Nominees Pty Ltd v Glenent Pty Ltd [2009] SASC 267, referred to.
Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTCA 9
(a) upon AAC transporting certain listed equipment to a location nominated by Sparks within 30 days of the date of the Deed the parties would take all steps necessary to discontinue the proceedings by consent with no order as to costs;
(b) each party would bear the cost of transporting the equipment in equal parts; and
(c) each party would bear its own costs of and incidental to the proceedings.
(a) ...
(b) the plaintiff is a corporation ... and there is reason to believe that the plaintiff has insufficient assets in the Territory to pay the costs of the defendant if ordered to do so;
(c) ...
(d) ...
(e) ...; or
(f) under an Act or the Corporations Act 2001 the Court may require security for costs,
the Court may, on the application of a defendant, order that the plaintiff give security for the costs of the defendant of the proceeding and that the proceeding as against the defendant be stayed until the security is given.
Where a corporation is plaintiff in any action or other legal proceeding the court having jurisdiction in the matter may, if it appears by credible testimony that there is a reason to believe that the corporation will be unable to pay the costs of the defendant if successful in his, her or its defence, require sufficient security to be given for those costs and stay all proceedings until security is given.
(a) Sparks had no real property in the Northern Territory;
(b) the amount of $833,695.41 had been payable by Sparks to the ATO since at least May 2024 with no details of any payment plan or how such a plan might impact on Sparks's financial position;
(c) in May 2024, Sparks's tax default was entered on the public Creditor Watch database, there had been a significant decline in Sparks's credit rating, and the Creditor Watch report estimated that Sparks had "a greater than 20% chance of default within the next 12 months";[4]
(d) in November 2024, Sparks sold the generator and retained the proceeds rather than paying them into court in accordance with AAC's written request;
(e) the value of the assets claimed to be owned by Sparks was "baldly stated" on information and belief with no proof of valuation or resale value;
(f) the statement of the Sparks's income for 2022-2023 contained no detail of its expenditure for that period and was almost two years old; and
(g) other than an estimate of current income (not expenditure) for the 2024 year, there was no substantial evidence as to Sparks's financial circumstances.
Those principles, insofar as they are relevant to the current case, are;
The usual starting point in determining what is an adequate amount is to estimate the likely costs incurred to date ... and the likely costs to be incurred until the matter is completed.
In my view applying the principles stated above to the facts of this case, an order for security for costs is appropriate. In terms of the quantum of the order, noting I am not obliged to fix an amount reflective of the full estimated costs and that I can have regard to contingencies, an adequate amount is $90,000.
[1] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24.
[2] Mannix Electrical Pty Ltd v Belport Pty Ltd [2019] SASC 159; (2019) 134 SASR 438 at [36]- [37]; citing Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65; (2014) 98 ACSR 301.
[3] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [13].
[4] See affidavit of Alison Phillis, 16 December 2024, Annexure G.
[5] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [11]- [14].
[6] DGR Global Ltd v PT Limited [2025] QCA 122 at [60].
[7] Cf Rimhart Nominees Pty Ltd v Glenent Pty Ltd [2009] SASC 267 at [28].
[8] See, for example, Drumdurno Pty Ltd v Braham [1982] FCA 161; (1982) 42 ALR 563 at 570-571. See also Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [21]- [22] in relation to whether the plaintiff's impecuniosity could be attributed to the actions of the defendant.
[9] Anchung Pty Ltd v Northern Territory of Australia [2015] NTSC 76 at [34]- [35].
[10] Attorney-General (Botswana) v Aussie Diamond Products Pty Ltd [2009] WASC 299 at [15].
[11] Arnold v Queensland [1987] FCA 148; (1987) 73 ALR 607 at 614.
[12] Bailey v Beagle Management Pty Ltd [2001] FCA 60; (2001) 182 ALR 264 at [33]- [34]; Beluga Developments Pty Ltd v Sobel Investments Pty Ltd [2010] VSC 303 at [12].
[13] Buckley v Bennell Design & Constructions Pty Ltd (1974) 1 ACLR 303 at 308.
[14] Hydrocool Pty Ltd v Hepburn (No 2) [2010] FCA 285 at [28].
[15] Octocane Pty Ltd v SRJ Property Development Pty Ltd [1999] SASC 231 at [51].
[16] See, for example, Green v CGU Insurance Ltd [2008] NSWCA 148; (2008) 67 ACSR 105 at [57].
[17] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [15]- [16].
[18] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [18].
[19] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [23].
[20] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [23].
[21] See, for example, Jazabas Pty Ltd v Haddad [2007] NSWCA 291; (2007) 65 ACSR 276 at [83]- [84].
[22] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [20]- [21].
[23] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [22].
[24] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [28]- [32].
[25] Sparks NT Pty Ltd v Angkerle Aboriginal Corporation [2025] NTSC 24 at [33].
Sparks NT Pty Ltd
Angkerle Aboriginal Corporation [2025] NTCA 9
(1987) 73 ALR 607
(2001) 182 ALR 264
(1982) 42 ALR 563
(2019) 134 SASR 438