Federal Court of Australia

Lehrmann v Network Ten Pty Limited [2024] FCA 1226

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application of the respondents dated 21 June 2024 be dismissed.

2.    Order 2 of the primary judge made on 27 June 2024 in proceeding NSD 103 of 2023, by which the appellant is to pay the first respondent $2,000,000, be stayed until the appeal in proceeding NSD 701 of 2024 is determined.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ABRAHAM J:

Introduction

1    There are two interlocutory applications for consideration. The respondents seek an order that the appellant provide security for the respondents’ costs of the appeal proceeding. The appellant seeks to stay the costs order made by the primary judge on 27 June 2024 requiring he pay $2 million to the first respondent.

2    For the reasons below, the respondents’ application for security is refused. I grant the appellant’s application for a stay on the primary judge’s cost order until the appeal in this proceeding is determined.

Procedural history

3    On 15 April 2024, the primary judge gave judgment for Network Ten and Ms Wilkinson in the proceeding below: Lehrmann v Network Ten Pty Limited (Trial Judgment) [2024] FCA 369. His Honour found that, on the balance of probabilities, Mr Lehrmann raped Ms Higgins and that Network Ten and Ms Wilkinson were entitled to judgment on the basis that they had established the defence of justification under s 25 of the Defamation Act 2005 (NSW). His Honour concluded the defence of statutory qualified privilege was not established.

4    On 10 May 2024, his Honour ordered Mr Lehrmann pay the respondents’ costs of the proceeding on the ordinary basis for the costs incurred in relation to the unsuccessful defence of statutory qualified privilege (other than costs in relation to specific affidavits) and on the indemnity basis for any other costs of or incidental to the proceeding: Lehrmann v Network Ten Pty Limited (Costs) [2024] FCA 486 (Lehrmann (Costs)).

5    On 27 June 2024, pursuant to ss 23, 37P(2) and 43 of the Federal Court of Australia Act 1976 (Cth) (FCA Act), his Honour ordered that the orders made on 10 May 2024 be varied such that the costs payable by Mr Lehrmann in favour of the respondents be quantified in a fixed sum, and that judgment be entered in favour of the first respondent in the amount of $2 million: Lehrmann v Network Ten Pty Limited (Costs) (No 2) [2024] FCA 706. Ms Wilkinson proposed to defer the quantification of any costs as between her and Mr Lehrmann, given the likelihood Mr Lehrmann would not be in a position to pay the adverse costs order quantified in favour of Network Ten. (I note that the primary judge found it was reasonable for Ms Wilkinson to have engaged separate legal representation in the proceedings, such that Network Ten was obliged to indemnify her: Lehrmann v Network Ten Pty Limited (Cross-claims) [2024] FCA 102.) Mr Lehrmann neither consented nor opposed the fixing of the amount of costs payable to Network Ten.

6    On 1 May 2024, at the request of Mr Lehrmann, the primary judge extended the date for the filing of any appeal in relation to the orders of 15 April 2024 until 31 May 2024. On 31 May 2024, Mr Lehrmann filed a notice of appeal seeking to set aside the primary judgment. At that time, he was unrepresented.

7    On 19 June 2024, Ms Wilkinson filed a notice of contention in relation to the appeal.

8    On 21 June 2024, Network Ten also filed a notice of contention and, separately applied for orders that the appellant, inter alia, provide security for the respondents’ costs for the appeal.

9    On 24 July 2024, the appellant formally appointed a solicitor, Ms Burrows, to represent him in the proceeding.

10    On 25 July 2024, at the first case management hearing in respect to the conduct of the appeal, the appellant indicated he intended to file an amended notice of appeal and to apply for an order to stay the costs order made by the primary judge. Orders were made for the filing and service of any amended notice of appeal by 29 August 2024, and for timetabling the security for costs and stay applications. On 1 August 2024, the appellant applied for a stay as foreshadowed.

11    On 6 September 2024, at a further case management hearing, the order for filing an amended notice of appeal was extended to 13 September 2024. An amended notice of appeal was filed that day.

Evidence relied on

12    In support of the security application, the respondents read an affidavit of Ms Saunders affirmed on 21 June 2024 ([15(b)] was not read) and a second affidavit of Ms Saunders affirmed on 13 September 2024. The appellant read the affidavit of Ms Burrows affirmed 6 September 2024.

13    In support of the stay application, the appellant read a second affidavit of Ms Burrows affirmed 1 August 2024. The respondents read the aforementioned affidavit of Ms Saunders affirmed 13 September 2024.

14    No objections were taken to any affidavit.

Relevant legal principles

15    The principles upon which security for costs may be ordered and a stay may be granted are well established.

Security for costs

16    In Etnyre v Australian Broadcasting Commission [2021] FCA 610 at [6]-[17], I summarised principles relevant to an application of this nature. That summary has since been adopted: see, e.g., Tickle v Giggle for Girls Pty Ltd [2023] FCA 553 at [66]; Karis v Digital CC Management Pty Ltd (No 3) [2024] FCA 738 (Karis) at [39]. I rely on that summary here, and in so far as it is relevant to the circumstances of this application, repeat it below, with some additions.

17    Section 56 of the FCA Act relevantly provides:

(1)    The Court or a Judge may order an applicant in a proceeding in the Court, or an appellant in an appeal under Division 2 of Part III, to give security for the payment of costs that may be awarded against him or her.

(2)    The security shall be of such amount, and given at such time and in such manner and form, as the Court or Judge directs.

18    Rule 36.09 of the Federal Court Rules 2011 (Cth) (FCR) relevantly provides:

(1)    A party may apply to the Court for an order that:

(a)    the appellant give security for the costs of the appeal, and for the manner, time and terms for giving the security; and

(b)    the appeal be stayed until security is given; and

(c)    if the appellant fails to comply with the order to provide security within the time specified in the order—the appeal be stayed or dismissed.

19    The power to order security is discretionary and has been described as “broad”: James v Australian and New Zealand Banking Group Ltd (No 1) [1985] FCA 539; (1985) 9 FCR 442 at 444; Madgwick v Kelly [2013] FCAFC 61; (2013) 212 FCR 1 (Madgwick) at [6]; Stapleton v Fairfax Media Publications Pty Ltd [2019] FCA 1418 (Stapleton) at [6]-[7]. The discretion “is to be exercised in light of the facts and circumstances of the particular case”: Stapleton at [6], quoting Botsman v Bolitho [2018] VSCA 111 at [36]. The issue is essentially one of risk management: East Grace Corporation v Xing (No 1) [2005] FCA 219 at [6].

20    Against that background, the authorities reflect the type of factors which have been considered as relevant on such applications, which have included the following.

21    First, whether the application for security for costs has been brought promptly: KP Cable Investments Pty Ltd v Meltglow Pty Ltd [1995] FCA 76; (1995) 56 FCR 189 at 197.

22    Second, whether the applicant (or appellant) is impecunious such that they would not be able to satisfy a costs order against it: Bell Wholesale Co. Ltd v Gates Export Corporation [1984] FCA 29; (1984) 2 FCR 1 at 4; Australian Equity Investors v Colliers International (NSW) Pty Ltd [2012] FCAFC 57 at [25]-[30].

23    Third, whether the appellant is a natural person or a corporation. Although courts are disinclined to order security against natural persons, even if impecunious, as Lindgren J observed in Knight v Beyond Properties Pty Ltd [2005] FCA 764 at [32]-[33], it has been recognised that being a natural person is no bar to an order for security for costs.

24    Fourth, the prospects of success of that person’s claim, or the merits of that claim: see, e.g., Staff Development & Training Centre Pty Ltd v Commonwealth of Australia [2005] FCA 1643 at [12]-[13]. Prospects of success may be especially relevant to an application for security for costs of an appeal given “the appellant has had his day in court”: Singh v Secretary, Department of Employment and Workplace Relations [2007] FCA 90 at [12].

25    Fifth, interrelated with impecuniosity is whether an order for security would stifle the litigation. It is generally observed that poverty is no bar to a litigant: Cowell v Taylor (1885) 31 Ch D 34 (Cowell) at 38. This is particularly so where it is a primary proceeding, although the position on appeal may be different: see, e.g., Dye v Commonwealth Securities Limited [2012] FCA 992 (Dye) at [27]. Cf Nyoni v Shire of Kellerberrin (No 9) [2016] FCA 472 (Nyoni) at [8]. It is for the party resisting the order to show that impecuniosity would stultify the proceedings.

26    The factors that may be relevant cannot be exhaustively stated, with the only limitation being that the discretion is exercised judicially: Madgwick at [6]. The Court’s discretion is to be exercised having regard to whether the interests of justice are best served by making or refusing an order: Gentry Brothers Pty Ltd v Wilson Brown & Associates Pty Ltd [1992] FCA 592; (1992) 8 ACSR 405 at 411; Karis at [38].

Stay of the costs order

27    I summarised the relevant principles in Viagogo AG v Australian Competition and Consumer Commission [2021] FCA 175 at [8]-[13].

28    Rule 36.08 of the FCR provides:

(1)     An appeal does not:

(a)    operate as a stay of execution or a stay of any proceedings under the judgment subject to the appeal; or

(b)    invalidate any proceedings already taken.

(2)     However, an appellant or interested person may apply to the Court for an order to stay the execution of the proceeding until the appeal is heard and determined.

(3)     An application may be made under subrule (2) even though the Court from which the appeal is brought has previously refused an application of a similar kind.

29    Rule 36.08 confers a broad discretion. Generally, there must be demonstrated “a reason or an appropriate case” to warrant the exercise of discretion in favour of granting a stay: Powerflex Services Pty Ltd v Data Access Corp [1996] FCA 460; (1996) 67 FCR 65 (Powerflex) at 66. It is not necessary to establish special or exceptional circumstances for the grant of a stay: Powerflex at 66.

30    Two questions must be considered. First, whether there is an arguable point on the proposed appeal: Nolten v Groeneveld Australia Pty Ltd [2011] FCA 1494 (Nolten) at [24], or some “rational prospect of success” in relation to any of the grounds of appeal: Burns v AMP Finance Ltd [2005] FCA 761 at [5]. A stay should not be granted unless the appeal is at least arguable, although it is usually inappropriate to speculate as to its prospects of success: Australian Competition and Consumer Commission v BMW (Australia) Ltd (No 2) [2003] FCA 864 (BMW) at [5]. Second, whether the balance of convenience favours the grant of a stay: Nolten at [24], [46].

31    The party seeking the order bears the onus of demonstrating a proper basis for a stay, which must be fair to all parties: Alexander v Cambridge Credit Corporation Ltd (receivers appointed) (1985) 2 NSWLR 685 (Alexander) at 694. That party must demonstrate that there is a real risk that it will suffer prejudice or damage if a stay is not granted, which will not be redressed by a successful appeal: Kalifair Pty Ltd v Digi-Tech (Australia) Ltd, McLean Tecnic Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; (2002) 55 NSWLR 737 (Kalifair) at [18]; Flight Centre Limited v Australian Competition and Consumer Commission [2014] FCA 658 (Flight Centre) at [9(f)]. This requirement will be satisfied if a successful appeal will be rendered nugatory unless a stay is granted: Ali v Australian Competition and Consumer Commission [2020] FCA 860 at [11]; BMW at [5]; Alexander at 695; Kalifair at [18].

32    The successful party at first instance is entitled to presume that the judgment appealed from is correct: Powerflex at 66, citing Re Middle Harbour Investments Ltd (in liq) (unreported, Court of Appeal NSW, 15 December 1976); Flight Centre at [9(b)]; Wooldridge v Australian Securities and Investments Commission [2015] FCA 349; (2015) 106 ACSR 551 (Wooldridge) at [11]; Urban Alley Brewery Pty Ltd v La Sirène Pty Ltd (No 2) [2020] FCA 351 at [48(b)], [51].

Submissions

33    The appellant’s grounds of appeal are as follows:

1.    The primary judge erred in upholding the defence of justification because the justification case found had not been pleaded, was different to the justification case which had been pleaded, had not been the subject of submissions, had not been argued by the Respondents and had not been put to the relevant witnesses contrary to the principles of procedural fairness and natural justice.

2.    The primary Judge erred in determining the meanings conveyed to an ordinary reasonable person by the publication complained of.

3.    The primary Judge erred in determining that the Respondents had established the defence of justification.

4.    The primary Judge erred in determining that the Applicant (if he had succeeded in his case) was entitled to a mere $20,000.00 in damages.

34    The submissions on each application overlap, as some considerations are relevant to both.

Security for costs

35    The first respondent’s application sought orders that the appellant pay security in the amount of $200,000 (or such amount that the Court may determine) within 42 days, and that the appeal against the respondents be dismissed if he fails to comply.

36    The first respondent conceded some of the grounds of appeal were arguable: see [51]. It submitted that any costs order will not be satisfied, that the respondents’ conduct did not cause the appellant’s impecuniosity, and there is no compelling public interest in the appeal proceedings that would weigh against the making of an order for security. It submitted that there would be no unfairness to the appellant in ordering him to pay an amount of security to cover its costs of the appeal that would also include the cost of work associated with its notice of contention given: (a) the very narrow scope of the grounds in Network Ten’s notice of contention and (b) the overlap between the matters raised in that notice and in Mr Lehrmann’s notices of appeal. It contended that Mr Lehrmann’s inefficient conduct of the proceeding to date gives rise to a reasonable concern that the actual costs incurred in the proceedings are likely to be greater than Network Ten’s initial estimate of $200,000: see [47]-[48].

37    Ms Wilkinson joined and adopted Network Ten’s written submissions in respect of the security application. She made additional submissions directed to the merits of the appeal, including that the appeal on ground one has lower prospects of success against her. She accepted in oral submissions that the appellant ought not be required to pay security for the contentions she raised in relation to her s 30 defence: see [48].

38    The appellant submitted that the first respondent is a powerful media company and $200,000 is subjectively not a considerable sum to lose, noting that it is likely to make far more in advertising revenue in reporting on the appeal proceedings. He submitted that the first respondent’s conduct complained of in the proceedings below and in its subsequent publications have caused, or have substantially contributed to, his impecuniosity given he was labelled a rapist and a person who “conned the court”. The appellant submitted that there is a genuine public interest that the appeal proceeds, and the appeal will be rendered nugatory if security is ordered. He drew attention to what he submitted is the power imbalance between him and the first respondent, contending that this application “is considered a bullying hard-hitting tactic, a procedural play to smack down this appeal”. He submitted he “is appealing from the finding of the criminality of being found a ‘rapist’”, where the first respondent “has confirmed the view that the proceedings below have been a de facto rape trial”.

Stay of the costs order

39    The appellant submitted that each of the grounds of appeal are arguable. In relation to the first ground, he submitted that how the rape occurred is different from the facts found at trial, the first respondent did not run that case, and it was a case that was not put to him nor Ms Higgins, which amounts to a denial of natural justice and procedural fairness. He identified what is said to be some of the differences. He submitted that an article – Hryce G, “Did Justice Lee get it wrong?”, Gazette of Law and Journalism (7 May 2024) – supports the merits of the second ground. By that submission, I take it the appellant relies on the issues identified in the article in relation to the judgment. In relation to the third ground, the appellant submitted that the case found by the primary judge was never put to him or other witnesses and is not supported by and is contrary to Ms Higgins’ evidence. By the fourth ground, he contended that $20,000 for a false charge of rape is manifestly inadequate.

40    The appellant also submitted that the respondents have filed notices of contention that support his view that the primary judgment is flawed.

41    The appellant submitted he cannot afford to pay the $2 million costs order, as he has been a recipient of Centrelink income since early 2022. He submitted that given that circumstance, for the first respondent to pursue enforcement at this stage is a tactical play to hinder his ability to appeal. He submitted that the first respondent has initiated enforcement proceedings with a bankruptcy notice, which will likely result in an application for a sequestration order. He submitted that if such an order is made against him, s 60(2) of the Bankruptcy Act 1996 (Cth) will apply, which will impact on his ability to continue the proceedings. He submitted that succeeding on appeal would not form a basis to reverse any sequestration order against him.

42    The appellant submitted that he “is appealing from the finding of the criminality of being found a ‘rapist’” and he should therefore “be entitled to clear his name and pursue his appeal without the bullying tactics of costs enforcement against him”, referring to the International Covenant on Civil and Political Rights art 14(5).

43    The appellant in both applications relied on the recognised position that “the general rule is that poverty is no bar to a litigant”, citing Cowell at 38.

44    The first respondent challenged each of the appellant’s submissions on the stay application. It took issue with the appellant’s submissions as to tactics and contended they are entitled to bring enforcement proceedings. It submitted that it could not be suggested that it could not repay any amounts paid by Mr Lehrmann in satisfaction of the costs order if the appeal was successful. It submitted that in any event, the point is academic in circumstances where Mr Lehrmann is apparently impecunious and has not paid a cent towards the amount of the costs order. It is said what is not academic is that Mr Lehrmann is seeking to make Network Ten incur the further costs of an appeal, with little to no likelihood that those costs will be recoverable if the appeal fails.

45    The second respondent supported the first respondent’s submissions on the stay application and made no separate submissions.

Consideration

Security for costs

46    Against the background of the relevant principles, I make several observations.

47    First, the respondents estimate the appeal will take three days, and initially sought $200,000 in security. Each have filed notices of contention. Network Ten’s notice of contention addresses issues already covered in Mr Lehrmann’s grounds. The same cannot be said in respect to Ms Wilkinson’s notice of contention, which substantially broadens the appeal. It contains three grounds alleging thirty particulars, including a ground not raised by Network Ten in relation to the defence of qualified privilege, which was rejected by the primary judge. It would significantly increase the length of the hearing, and the costs involved.

48    During the oral hearing, the respondents submitted that the arguments relating to the appellant’s grounds, and the related grounds in the respondents’ notices of contention, would take about one-and-a-half days. Network Ten explained that of that time they would require half a day to put their submissions in opposition. The remaining time in the three-day estimate related to the additional grounds in Ms Wilkinson’s notice of contention. Ms Wilkinson properly accepted in oral submissions that the appellant ought not be required to pay security in respect to that aspect of her notice of contention. On that basis, Network Ten reduced the amount of security sought to $180,000 for a two-day hearing on the notice of appeal (and its overlapping grounds in the notices contention) or $170,000 to cover one-and-a-half days of hearing on that aspect.

49    Second, there is no dispute that Mr Lehrmann is impecunious. Although there was some debate as to whether the respondents contributed to that impecuniosity, that is unnecessary to determine to resolve this application. Further, to state the obvious, he is a natural person: see [23] above.

50    Third, the respondents accepted that an order for security would likely stultify the appeal given the appellant’s impecuniosity.

51    Fourth, the respondents accept that there are grounds of appeal that are at least arguable. Ms Wilkinson separately submitted that the prospects of success against her are lower in relation to the first ground. Although Network Ten submitted orally that the appellant’s grounds of appeal ranged from “hopeless” to “faintly arguable”, it later accepted that it was not submitting that “the notice of appeal is so hopeless that there’s nothing to go to an appeal court”, but that rather it was simply pointing out that, on its submission, it is not a strong case.

52    Any consideration of the merits of the appeal could not be undertaken on the scant material before the Court in these applications. That practical limitation became readily apparent as the respondents advanced submissions on this topic during the oral hearing (which included matters broader than the primary judgment), which they appeared to accept. In that circumstance, speculation as to the prospects of success is inappropriate. Neither respondent challenged that position.

53    Consequently, I approach the consideration of the application on the basis that there are arguable grounds of appeal.

54    Fifth, the respondents submitted there is no public interest in the appeal which weighs against ordering security which, they stressed, was the relevant question before the Court. I note the respondents relied on different principles on this point. That said, each contended that the appellant had had his day in court, relying heavily on the fact that he had instituted the proceedings. The appellant contends otherwise, submitting it is in the public interest that Mr Lehrmann have the opportunity to challenge the finding against him, given that criminality inheres in the concept of rape, and is impacting him in that context.

55    Network Ten advanced a narrow conception of the public interest, and at times appeared to suggest it was a constraint on the Court’s discretion. It relied on Dye at [27] for the proposition that the assessment of security on appeal differs from that at first instance, particularly in so far as the grounds of appeal raise some question of law – such as a conflict in the authorities, some novel question or the development of a principle of law – as opposed to a case where the appeal is essentially on questions of fact. It submitted the latter is, according to the authorities, not in the public interest. Network Ten also relied on Chawk v Callan [2024] FCA 92 (Chawk) as an illustration of the application of that principle. In that context, it submitted that the appellant’s grounds either simply challenge factual findings or otherwise fail to raise a question of law recognised in the authorities and are therefore not public interest grounds. I note its characterisation of the grounds as merely factual must be considered in the context where the first ground concerns an allegation of a procedural fairness.

56    Network Ten elevates the cases to a point of principle too narrowly described. The authorities it referred to explain that the position in relation to security may be different on appeal where the appeal turns largely on questions of fact and gives rise to no important question of law. It does not confine the broad and unfettered discretion which reposes in the Court.

57    Moreover, Network Ten’s reliance on Chawk as analogous or akin to the circumstances in this case is misplaced. Chawk is no more than an example of the Court applying relevant considerations to the facts of that case. Any decision is necessarily fact specific. Nor does Chawk appear to confine the meaning of public interest as narrowly as the first respondent contends: at [34]. Moreover, public interest is but one consideration that may be relevant to the exercise of the discretion.

58    Consistent with authority, where an order for security has not been made against an impecunious appellant, the Court’s discretion has been exercised by reference to the facts and circumstances of each individual case: see, e.g., Nyoni at [7], [26], [29]; Hardingham v RP Data Pty Ltd [2020] FCA 1062 at [10]; Allison v Murphy [2021] FCA 1551 at [15].

59    Ms Wilkinson did not accept that the consideration of public interest was as narrow as that framed by Network Ten. Rather, she submitted that the question is directed to how the public confidence in the justice system would be affected if the appellant is deprived of challenging the finding because of an order for security for costs. She accepted that is informed by broader considerations, including the seriousness of the finding.

60    Irrespective of the difference in approach, in the context of public interest, the respondents submitted that the appellant has had his day in Court, with Network Ten emphasising that it was a 26-day trial. He did bring the proceeding, and he has had a hearing. That is said to be a factor against the appellant’s argument on public interest: see [54].

61    However, it is not quite as simple as that. The primary judge observed in Lehrmann (Costs) at [1]-[2]:

[1]    There are no real winners in this litigation.

[2]    The result is best characterised as the respondents overcoming a misconceived claim in relation to a broadcast because they were able to prove at trial the substantial truth of what the contemporaneous material demonstrates they considered to be the less substantial allegation made in the broadcast.

62    The primary judge made findings against all parties. Notwithstanding judgment in the respondents’ favour, aspects of their case failed, including in relation to his Honour’s consideration of the justification defence. All parties now claim the primary judgment contains errors. The appellant alleges several errors, with the respondents conceding he has arguable grounds. The respondents each allege further errors (particularly Ms Wilkinson (see [47])), including in relation to the finding of justification. That the respondents do so by raising notices of contention rather than a cross-appeal does not alter the character of the allegations in the notices, even though they do not fall for determination unless the appellant establishes his appeal.

63    In all the circumstances, I do not accept the respondents’ submissions that there is no public interest, in the relevant sense, in the appeal.

64    Sixth, as Ms Wilkinson recognised, this application is in a context where the appellant has a right of appeal: FCA Act s 24(1). See also HBSY v Lewis [2024] HCA 35 at [98]. In that circumstance, the appellate process is a fundamental aspect of the administration of justice.

65    As the appellant essentially submitted, the finding against him is extremely serious. Ms Wilkinson described it as a finding of criminal conduct. The impact on him if he is denied that right is self-evident. That is the likely consequence of making the order the respondents seek. This is in a context of it being accepted there are arguable grounds of appeal.

66    The Court’s discretion must be exercised judicially, but otherwise is broad and unfettered. It is to be exercised having regard to what best serves the interests of justice.

67    I am conscious that the respondents will incur costs should this appeal proceed which, if any costs orders are made in their favour, will likely be unrecoverable. Nonetheless, I am not persuaded, given the considerations relevant to the particular facts and circumstances of this case, that an order for security ought to be made.

Stay of the costs order

68    Given the respondents accept that there are arguable grounds of appeal, the focus of the consideration of the stay application is directed to the second of the two inquiries described at [30], that is, whether the balance of convenience favours the grant of a stay.

69    There is no dispute that Mr Lehrmann is on Centrelink benefits and is impecunious. Network Ten accepts that Mr Lehrmann does not have the money to pay the order. Although it has commenced an enforcement process against him, as they were entitled to do, there is no basis for thinking that it will retrieve the amount owed. Network Ten accepted that proposition.

70    In that circumstance, it is unclear what the prejudice to the respondents is said to be if the costs order was stayed pending the appeal. Particularly given that they accept the grounds are at least arguable, and that any costs order (the basis of the bankruptcy) would be overturned if the appeal succeeds. Ultimately no prejudice was articulated by Network Ten, except that of delay in resolution of the issue. I note that the parties would incur costs in advancing the bankruptcy proceedings.

71    On the other hand, Mr Lehrmann would likely be declared bankrupt, with all that that entails. It would likely affect his prosecution of any appeal. That the first respondent asserts Mr Lehrmann has no ability to obtain money in any event is of no moment. If he were to succeed on appeal, the consequences on a sequestration order are unclear, although it would necessarily involve further proceedings (as the sequestration order would still stand).

72    In the circumstances, I am satisfied that the balance of convenience favours the granting of a stay of the costs order.

Conclusion

73    The respondents’ application for security for costs of the appeal is not established, and accordingly the application is dismissed. The appellant’s application for a stay of the costs order below is granted.

Associate:

Dated:    23 October 2024