THE COURT ORDERS THAT:

1.         Adjourn the motion to strike out the appeal to the Registrar for listing before the Full Court.

2.         Dismiss the motion for security for costs.

3.         There will be no order as to the costs of the proceedings before me today.

Note:                Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

This is an application for security for costs brought on behalf of the Commonwealth, which is the respondent to an appeal lodged by the appellant, William Van Oostveen.

The appeal is from a decision of my brother Drummond striking out an action commenced by the appellant seeking damages from the Commonwealth, apparently arising out of his employment.  Two applications are brought before me today on behalf of the Commonwealth.  One is to strike out the appeal as incompetent, and the other is for security for costs.  I have already dealt with the first motion.  That application is framed as an application  to strike out the appeal as incompetent, but when the matter came before me this morning Mr Bickford for the Commonwealth sought to amend the application to turn it into an application pursuant to O 20 r 2.  In the course of argument I indicated that I shared the view expressed by O'Loughlin J in D’Ortenzio v Telstra Corporation Limited (O’Loughlin J, 1 May 1998, unreported), that there was no power in a single judge to act pursuant to that rule in connection with an appeal.  In those circumstances I have adjourned the unamended motion to the Registrar for listing before the Full Court.  A parallel application was brought for security for costs of the appeal.  It is based upon a perception that having regard to the appellant's other financial obligations, he does not have assets sufficient to meet an order for costs made against him should his appeal be unsuccessful.  I record that I accept the submission made on behalf of the Commonwealth that it is likely that the appeal will be unsuccessful.

He owns, as it appears, two blocks of land.  The Commonwealth has obtained a valuation of one of them at $48,000, although it seems that the appellant may presently be seeking to sell it at a somewhat lower price.  The material discloses that he also owns another block of land at Tara which is valued by the Valuer-General at $5,400.  Both blocks are quite large, and the valuation in respect of the Tara land seems to be a little on the light side, but that is probably neither here nor there for present purposes.  It is impossible to know precisely what the value of his assets might be, but it seems likely to be between $40,000 and $55,000.  He owes rates in the amount of $949 with respect to the Miriamvale property.  There may be arrears in respect to the other property but if so, the amount is unknown.  His other liabilities are to the Commonwealth in respect of legal proceedings in which he has been engaged.

Proceedings before Ryan J resulted in an order for costs (not yet been taxed) in favour of the Commonwealth, estimated to be in the amount of $6,402.75.  The estimated costs of an unsuccessful appeal from that decision are $7,217.05.  Any order for costs in the proceedings before Drummond J, from which the current appeal is brought, is estimated at $9,382.25.  A further application for a stay which was unsuccessful incurred an order for costs estimated at $2,363.90.  Accepting those costs at face value, his total exposure is something over $25,000.  To that must be added the rates arrears, bringing a total of about $26,000.  It is estimated that the Commonwealth’s costs of this application for security are $6,427.35, and the costs of the application to strike out, which I have in effect declined to deal with, are $3,857.  The estimated costs of the appeal are $4,316.  I should say that the appeal has progressed to the stage where the appeal book has been prepared. 

Although I can understand the Commonwealth's concern, given that the appellant's prospects of success in the appeal are not great and the possibility that he might sell the land, I nonetheless consider that this application is misconceived.  Had it not been brought, and setting aside the costs of the application to strike out, which can hardly be described as having been successful so far, the appellant appears to have assets more than sufficient to meet the estimated costs orders incurred to date, his arrears of rates, and the costs of the appeal, although the margin may not be great.  In those circumstances, this application is likely to cause undue hardship, particularly given its own substantial estimated cost.  It is not an appropriate use of the security for costs provisions to incur substantial costs in bringing such an application when in its absence, there would probably be sufficient, or almost sufficient, to meet the likely costs of the proceedings in question.

In those circumstances, I dismiss the application for security for costs.  Now, there can be no question of any order for costs with  respect to the application for security.  I make no order for costs in respect of that application, nor should there be any order in respect of the other motion.

Associate:

Dated:              6 October 1998