FEDERAL COURT OF AUSTRALIA

Humphries v Newport Quays Stage 2A Pty Ltd (No 3) [2009] FCA 1499

ANNA KATHRYN HUMPHRIES v NEWPORT QUAYS STAGE 2A PTY LTD ACN 117 374 222, MC MARINA SOUTH LTD ACN 121 362 301 and REBECCA MCFARLANE

SAD 152 of 2008

BESANKO J

8 DECEMBER 2009

ADELAIDE

THE COURT ORDERS THAT:

1.                  The applicant provide security for costs to the first and second respondents in the sum of $40,000.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                     This is an application by the first and second respondents against the applicant for security for costs. The application is brought under s 56 of the Federal Court of Australia Act 1976 (Cth) and O 28 of the Federal Court Rules.

2                     The nature of the applicant’s claim against the first and second respondents is described in an earlier judgment I delivered in the proceeding: Humphries v Newport Quays Stage 2A Pty Ltd (No 2) [2009] FCA 1135. Since that time, the applicant has filed a Second Further Amended Statement of Claim in which she makes it clear that she had a conversation with her father, Mr Peter Humphries, and he recommended that the applicant look seriously at entering into a contract to purchase a villa and marina berth (see [56]).

3                     The applicant submitted that I should not make an order for security for costs at this stage. She submitted that the proceeding by her father, Mr Peter Humphries, will be heard first and that the result in his proceeding is likely to be the result in her proceeding. In the circumstances, it is likely that the applicant’s proceeding will settle without coming to trial. I reject this argument. No order as to the hearing of the applicant’s claim has been made at this stage. However, the most likely order is that her claim be heard with the claim of her father.

4                     Assuming the failure of the first argument, the applicant did not oppose an order for security for costs. However, she did dispute the applicant’s claim for security in the sum of $60,000.

5                     Two matters were of common ground between the parties. First, the quantum of security is to be determined, in this case at least, by reference to party and party costs. Secondly, the security ordered may extend not only to future costs but also to costs already incurred (see Bryan E Fencott Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 at 515 per French J (as his Honour then was)). That is not a significant consideration in this case because the evidence before me suggests that, as at 10 July 2009, the costs incurred by the first and second respondents totalled $4,000.

6                     In his affidavit of 10 July 2009, Mr Matthew Selley sets out his estimate of the costs up to and including the first day of trial. Mr Selley is a solicitor acting on behalf of the first and second respondents.

7                     I think that there are likely to be some reasonably significant costs savings as there is an overlap of issues between the proceeding by Mr Peter Humphries and the proceeding by the applicant. It is impossible to be precise, but, in my opinion, the appropriate quantum of security is $40,000.

8                     I will order that the applicant provide security for costs to the first and second respondents in the sum of $40,000. I will hear the parties as to the terms of the order.

Associate:

Dated:         14 December 2009