Re Diane Lawyers Pty Ltd (ACN 650 581 196) (No 2)
[2022] QSC 42
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- Re Diane Lawyers Pty Ltd (ACN 650 581 196) (No 2)[2022] QSC 42
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Re Diane Lawyers Pty Ltd (ACN 650 581 196) (No 2)[2022] QSC 42
Re Diane Lawyers Pty Ltd (ACN 650 581 196) (No 2)[2022] QSC 42
SUPREME COURT OF QUEENSLAND
CITATION: | Re Diane Lawyers Pty Ltd (ACN 650 581 196) (No 2) [2022] QSC 42 |
PARTIES: | CGA LAW PTY LTD (ACN 623 155 180) (first applicant) AND CGA CONSULTING PTY LTD (ACN 164 583 484) ATF CGA CONSULTING TRUST (second applicant) v DIANE LAWYERS PTY LTD (ACN 650 581 196) (first respondent) AND DIANE AMANDA MASSELOS (second respondent) |
FILE NO: | BS 7076 of 2021 |
DIVISION: | Trial Division |
PROCEEDING: | Originating Application filed 22 June 2021 and Interlocutory Application filed 20 August 2021 and written submissions as to costs provided 22 September 2021 and 1 October 2021. |
ORIGINATING COURT: | Supreme Court at Brisbane |
DELIVERED ON: | 1 April 2022 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 24 August 2021 |
JUDGE: | Jackson J |
ORDER: | The order of the Court is that:
|
CATCHWORDS: | PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – INTERLOCUTORY PROCEEDINGS – GENERALLY – where the parties had agreed that the originating application should proceed as if started by claim – where the applicant succeeded at the hearing on the question of whether the application should be dismissed – where the respondent succeeded at the hearing on the question of security for costs PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – INTERLOCUTORY PROCEEDINGS – GENERALLY – where the respondents’ cross-application was dismissed – where the parties were required to appear on the disputes on the originating application regardless of the cross-application – whether the order should be limited to the additional costs attributable to the cross-application Corporations Act 2001 (Cth) s 181, s 182, s 183, s 461 |
COUNSEL: | C Coulsen for the applicants A Morris QC for the respondents |
SOLICITORS: | Morgan Conley Solicitors for the applicants Australian Law Partners for the respondents |
Jackson J:
- [1]On 24 August 2021, the originating application in this proceeding for an order that the first respondent be wound up and other relief, including an account and a declaration that the second respondent contravened ss 181 to 183 of the Corporations Act 2001 (Cth) (“CA”) came on for an adjourned hearing. It was also the hearing of a cross-application by the respondents for an order restraining the applicants from accessing the legal files of the former clients of the first applicant and from contacting, directly or indirectly, or encouraging others to contact, clients or former clients of the first respondent.
- [2]Upon the originating application, the applicants orally applied for an order that the proceeding continue as if started by claim with directions as to pleadings and other steps. The respondents opposed that application and submitted that the originating application should be dismissed or that the application to wind up the first respondent should be dismissed on the ground that there was no arguable case that the first respondent should be wound up on the just and equitable ground under s 461(1)(k) of the CA. The respondents also applied for an order for security for costs of the winding up application if it was to be continued.
- [3]On 9 September 2021, I decided the disputed questions upon the cross-applications.[1] In summary, the conclusions I reached were as follows: first, except for the claim for a winding up order the proceeding should continue as if started by claim, in any event; second, on the application for a winding up order, there is a prima facie case that the first applicant is a contingent creditor and that it is just and equitable that the first respondent be wound up; third, the first applicant should be ordered to give security for costs in the sum of $50,000; fourth, the proceeding as a whole should be stayed until the security for costs is provided; last, the cross-application for an interlocutory injunction should be dismissed.
- [4]There remains a dispute as to the appropriate orders for costs. The outstanding questions are the costs of the hearing upon the originating application on 24 August 2021 and the costs of the cross-application for an interlocutory injunction.
- [5]As to the latter, the parties agree that an order should be made that the respondents pay the applicants’ costs of the application. However, the respondents submit that the order should be limited to the “additional” costs attributable to that cross-application, having regard to the fact that the parties were required to appear on the disputes on the originating application in any event.
- [6]In my view, the suggested limitation on the order for costs of the cross-application for an interlocutory injunction should not be made. It was a discrete application brought by the respondents. Upon an order that the respondents pay the applicants’ costs of the cross-application for an interlocutory injunction, what is the proper amount of the costs of that application assessed on the standard basis is a matter of assessment.
- [7]The remaining question is the costs of the originating application on 24 August 2021. Before the hearing date both parties had proposed that the originating application should proceed as if started by claim. That was proposed by the respondents, initially, on 26 July 2021 and by the applicants on 27 July 2021.
- [8]However, there were disputed questions that still required resolution on 24 August 2021.
- [9]One was the respondents’ submission that the winding up application should not be ordered to proceed as if started by claim but should be dealt with finally and dismissed. The applicants succeeded on that question.
- [10]Another was that the applicants should be ordered to give security for costs before the winding up application could or should proceed. The respondents submitted that $50,000 of security for costs should be given in the usual way. The applicants did not offer security in that form. The respondents succeeded on that question.
- [11]The respondents submitted that, in any event, the applicants should be ordered to pay the respondents’ costs of the hearing on 24 August 2021 of the originating application because the proceeding should have been started by claim. But as the matter was heard and argued, it was the respondents who pressed for a final determination on that day and did so unsuccessfully.
- [12]In my view, both parties had some success on 24 August 2021 in terms of the orders that were made upon the originating application. The appropriate order is that the parties’ costs of the hearing on 24 August on the originating application, resulting in the orders made that the originating application proceed as if started by claim and that the applicants provide security for costs of the winding up application, should be costs in the proceeding.
Footnotes
[1] Re Diane Lawyers Pty Ltd [2021] QSC 229.