Federal Court of Australia

Stelamar LLC v Soar.Earth Limited (Subject to a Deed of Company Arrangement) (No 3) [2026] FCA 1656

ORDERS

THE COURT ORDERS THAT:

1.    The plaintiff pay the costs of the first, third, fourth, fifth and sixth defendants of the proceeding in the lump sum of $23,187.62.

2.    The plaintiffs are jointly and severally liable to pay the amount referred to in order 1.

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

REASONS FOR JUDGMENT

JACKMAN J:

1    I gave judgment in these proceedings on 4 September 2026, dismissing the originating process and setting a timetable for affidavits and written submissions on the question of costs: Stelamar LLC v Soar.Earth Limited (Subject to Deed of Company Arrangement) (No 2) [2026] FCA 1318. The only active defendants at the hearing were the second defendants, being the Administrators. It appears that the plaintiffs and the Administrators have resolved the issue of costs by agreement.

2    The first and third to sixth defendants (Submitting Defendants) seek an order in their favour for costs, and that such an order be by way of lump sum. The Submitting Defendants filed a submitting notice on 21 July 2026 (Submitting Notice), about six weeks after the Originating Process was filed. The plaintiffs oppose a costs order in favour of the Submitting Defendants.

3    It is common ground that the filing of a submitting notice save as to costs is relevant to the broad costs discretion under s 43 of the Federal Court of Australia Act 1976 (Cth), and that the filing of such a notice does not create a prima facie position that no costs will be awarded from the date of the notice; rather, the question must be determined on the basis of an appraisal of all the facts: Federal Commissioner of Taxation v Warner (No 2) [2015] FCA 1281; (2015) 244 FCR 498 at [21]–[22] (Perry J); Dyer v Chrysanthou (No 3) [2021] FCA 642 at [5] (Thawley J).

4    As the plaintiffs accept, the Submitting Defendants had an interest in the outcome of the proceedings, in that the Submitting Defendants comprised the company in question and its directors (who were the proponents of the deed of company arrangement), together with a subsidiary company. The Submitting Defendants were entitled to seek legal advice and assistance before filing the Submitting Notice, as the plaintiffs appear to accept. The vast majority of the costs sought were incurred up to and including the filing of the Submitting Notice and also in relation to preparing affidavits and written submissions on the question of costs. Of the $22,340.50 (excluding GST) charged by solicitors for the Submitting Defendants on 31 August 2026, $20,265 was for work up to the filing of the Submitting Notice: affidavit of Mr Barr of 24 September 2026 at [16]–[17]. It was plainly reasonable for the Submitting Defendants to incur significant legal costs before deciding to file the Submitting Notice, and thereafter to incur a relatively modest amount in keeping abreast of the proceedings without actively participating in them. Their conduct has not materially increased the plaintiffs’ costs, and has been entirely reasonable. As the plaintiffs have failed in their Originating Process, it is appropriate that they pay the Submitting Defendants’ costs.

5    It is practicable and appropriate to order that those costs be paid by way of lump sum. The quantification of costs is supported by the affidavits made by Mr Barr of 24 September 2026 concerning costs incurred with the Australian law firm engaged by the Submitting Defendants (and applying a 40% discount to the fees actually incurred), and by Mr Revelins of 3 October 2026 in relation to a relatively small amount incurred with a New York firm engaged by the first defendant (and applying a 50% discount to the fees actually incurred). I accept that evidence, which amounts to a lump sum of $23,187.62. I note that the plaintiffs expressly disavow any argument for a different sum by way of fall-back to their submission that no costs should be payable to the Submitting Defendants. Accordingly, I make the orders sought by the Submitting Defendants.

Associate:

Dated:    3 November 2026

SCHEDULE OF PARTIES