FEDERAL COURT OF AUSTRALIA

Mead v Mead [2010] FCA 288

THE COURT ORDERS THAT:

1.         The Appellant, Ms Lucy Guitar Mead, together with the Appellant in proceeding NSD 1447/2009, Ms Lee Chin Lien Yang, provide security for costs for the appeals NSD 1445/2009 and NSD 1447/2009 in the amount of $10,000 in a form acceptable to the Registrar of the Court on or before Monday 12 April 2010.

2.         The matter be stayed pending the provision of the security for costs.

3.         The matter be stood over for further directions on Thursday 22 April 2010 at 9:30 am.

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 Federal Law Search on the Court’s website.

THE COURT ORDERS THAT:

1.     The Appellant, Ms Lee Chin Lien Yang, together with the Appellant in proceeding NSD 1445/2009, Ms Lucy Guitar Mead, provide security for costs for the appeals NSD 1445/2009 and NSD 1447/2009 in the amount of $10,000 in a form acceptable to the Registrar of the Court on or before Monday 12 April 2010.

2.     The matter be stayed pending the provision of the security for costs.

3.     The matter be stood over for further directions on Thursday 22 April 2010 at 9:30 am.

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 Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

1                          I have before me two notices of motion seeking security for costs, for appeals brought by Ms Mead and Ms Yang.  The motions for security are supported by affidavits of Mr Lim, who sets out the lengthy background to the proceedings and explains the amount of security which is sought.

2                          I have power under section 56 of the Federal Court of Australia Act 1976 (Cth) to order security for costs.  Clearly the power is discretionary, and the authorities have set out the matters to be taken into account in the exercise of the discretion. 

3                          The only real question which arises in the present case seems, to me, to be whether the application for security is oppressive, in the sense that it is being used merely to deny an impecunious applicant a right to litigate. 

4                          The appellant and the respondent have been embroiled in litigation for more than 12 years.  Numerous costs orders have been made against Ms Mead in favour of the respondent and there was a lengthy outline of the orders set out in Mr Lim’s written submissions.  The background shows that a judgment has been entered against Ms Mead in the Family Court for payment of an amount in excess of $3 million.  This order has not been satisfied, nor has an order of O’Ryan J in the Family Court, made in December 2009, that Ms Mead pay the costs of the respondent, which appear to have been assessed in the amount of $800,000. 

5                          The bankruptcy proceedings also have a long history.  A bankruptcy notice was issued on 6 March 2008.  Ms Mead filed an application in the Federal Magistrates Court to set it aside.  On 15 July 2009, Barnes FM dismissed the application to set aside the bankruptcy notice.  The respondent, that is Mr Mead, then filed a creditor’s petition on 17 July 2009. 

6                          Ms Mead filed a notice of appeal against the orders of Barnes FM, but on 26 October 2009, Flick J dismissed the appellant’s appeal and delivered reasons for his judgment, see Yang v Mead [2009] FCA 1202.  Ms Mead has filed an application for special leave to appeal to the High Court against the orders of Flick J.  The High Court has yet to determine the special leave application, but it is anticipated that the application will be determined within a fairly short period of time.

7                          On 30 November 2009 Driver FM made a sequestration order against Ms Mead’s estate.  He delivered reasons for judgment, see Mead & Mead (No 2) [2009] FMCA 1107.

8                          There is evidence, to which I have been taken, which indicates that Ms Mead has informed a Family Court judge that she has no assets to meet payment of a fine which was sought to be imposed on her, and there is no assertion by Ms Mead that she is solvent.  Indeed, in ground 10 of her notice of appeal, Ms Mead has stated that she has no present assets and no available prospect of future assets.

9                          It is true that an order for security may impose a bar to Ms Mead’s ability to pursue her appeal, however as Dowsett J said in Beames v Rigby [2002] FCA 1095 at [4], the question is one of balance between the right to appeal, and the judgment creditor’s interest in securing himself against the risk that he will be unable to recover costs in the event that he is successful on appeal.  In that matter, Dowsett J made an order for security for costs and observed that the bankrupt’s arguments on the appeal appeared to be little more than re-ventilation of the matters previously raised.  His Honour, in those circumstances, saw no reason to believe that the prospects would be any better on appeal.

10                        Whilst, in the short time available to me this morning, I have not had the opportunity to look closely at the prospects of success on appeal, it does seem to me that Ms Mead’s arguments amount to little more than a re-ventilation of matters, in the same way as concerned Dowsett J in Beames v Rigby.  There are new grounds which relate to Driver FM’s decision for refusal to adjourn the proceedings, but I do not think that these are sufficient to warrant the refusal of an order for security for costs.  Nor do I consider that the order for security is inappropriate in light of the fact that the High Court has yet to deal with the special leave application.

11                        However, I will bring the matter back before me in approximately five weeks time and there may be some clarity at that stage in the position of the special leave application in the High Court. 

12                        It seems to me that, in all the circumstances, the proper exercise of my discretion is to make an order for security for costs.  The quantum of the security is set out, as I have said, in Mr Lim’s affidavit. 

13                        The same considerations apply in the matter of Yang v Mead (proceeding NSD 1447 of 2009), both in relation to the exercise of the discretion and to the quantum of the security order. 

14                        What is sought by way of security is an amount of approximately $14,800 referable to both matters.

15                        It seems to me, and Mr Lim accepts, that I do have a broad discretion and although I accept that the amount is probably a conservative estimate, I think in all the circumstances, what I ought to do is to order that Ms Mead and Ms Yang provide security for the costs of the appeals in the amount of $10,000 in a form acceptable to the Registrar of the Court.

16                        I order that the security be supplied on or before Monday, 12 April 2010; I order a stay of the further prosecution of the appeals pending the provision of security; and I adjourn the matter for further directions before me on Thursday, 22 April 2010.

Associate:

Dated:         25 March 2010