FEDERAL COURT OF AUSTRALIA Addenbrooke Pty Ltd v Duncan (No 4) [2014] FCA 579 Citation: Addenbrooke Pty Ltd v Duncan (No 4) [2014] FCA 579 Parties: ADDENBROOKE PTY LIMITED ACN 055 973 576 v TRAVERS WILLIAM DUNCAN, PETER GRAY, and SOUTHERN CROSS EQUITIES PTY LTD ACN 071 935 441 File number: NSD 2243 of 2012 Judge: JACOBSON J Date of judgment: 27 May 2014 Cases cited: Addenbrooke Pty Ltd v Duncan (No 3) [2014] FCA 322 Date of hearing: 27 May 2014 Place: Sydney Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 11 Counsel for the Applicant: Mr FM Douglas QC with Mr G O'Mahoney Solicitor for the Applicant: Gye & Associates Counsel for the First Respondent: Mr GES Ng Solicitor for the First Respondent: Yeldham Price O'Brien Lusk Counsel for Second and Third Respondents: Mr JAC Potts Solicitor for Second and Third Respondents: Speed & Stracey Lawyers IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2243 of 2012 BETWEEN: ADDENBROOKE PTY LIMITED ACN 055 973 576 Applicant AND: TRAVERS WILLIAM DUNCAN First Respondent PETER GRAY Second Respondent SOUTHERN CROSS EQUITIES PTY LTD ACN 071 935 441 Third Respondent JUDGE: JACOBSON J DATE OF ORDER: 27 MAY 2014 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The interlocutory applications filed by: (a) the First Respondent on 22 May 2014; and (b) the Second and Third Respondents on 27 May 2014 be dismissed. 2. The Respondents pay the costs of the interlocutory applications heard on 27 May 2014. 3. The Notice to Produce issued by the Applicant on 23 May 2014 is set aside. 4. The Applicant pay the Second Respondent's costs of the interlocutory application to set aside the Notice to Produce. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2243 of 2012 BETWEEN: ADDENBROOKE PTY LIMITED ACN 055 973 576 Applicant AND: TRAVERS WILLIAM DUNCAN First Respondent PETER GRAY Second Respondent SOUTHERN CROSS EQUITIES PTY LTD ACN 071 935 441 Third Respondent JUDGE: JACOBSON J DATE: 27 MAY 2014 PLACE: SYDNEY REASONS FOR JUDGMENT 1 I have before me two interlocutory applications brought on behalf of the remaining respondents in these proceedings. The effect of the interlocutory applications brought by those respondents is to seek to vary the orders for security which I made on 2 April 2014. 2 Mr Ng of Counsel appears for the first respondent, Mr Duncan. Mr Potts of Counsel appears for the second respondent, Mr Gray, and the third respondent, Southern Cross Equities Pty Ltd. The submissions proceed upon the obvious proposition that in order to enliven the jurisdiction of the Court to vary the previous interlocutory order, it is necessary to demonstrate changed circumstances. 3 The respondents submit that the necessary changed circumstances arise from the reduction of the number of respondents who will now proceed to trial. This is because since 2 April 2014, the applicant has reached settlements (the terms of which I am unaware) with the other, then remaining respondents. 4 Thus, the position is that whereas on the previous occasion, I proceeded upon the assumption that there would be five relevant groups of respondents, there are now only three relevant groups of respondents. To that should be added the fact that the second and third respondents now have common representation so that on one view, there may only be two relevant groups of respondents. 5 It is common ground that the estimates of the costs to be incurred by the remaining respondents well exceed the sum of $300,000 which I ordered in respect of each of the five respondents in my earlier judgment. The essence of the arguments put by Mr Ng and Mr Potts is that the rationale for my previous order was an application of the principle of proportionality. They point in that regard, in particular, to [42] and [45] of my earlier reasons for judgment: Addenbrooke Pty Ltd v Duncan (No 3) [2014] FCA 322. 6 Thus, as Mr Ng submitted, the change in the composition of the respondents from five groups of respondents to three is the relevant changed circumstance, which should result in a re-apportionment of the sum of $1.5 million between the remaining respondents. 7 The submissions put on behalf of the respondents do, at first sight, have some logical attraction. However, notwithstanding the force of those submissions, it seems to me the better view is that whilst proportionality was a guiding factor in the exercise of my discretion, I took into account the position of each of the respondents in determining that $300,000 was the correct allocation. 8 It is true that I said in [45] of my earlier reasons that I did not consider it necessary to distinguish between the respondents in determining the amount of security. But that was merely to emphasise that I did not think it appropriate to look at the different cost estimates given by them in support of the applications for security. Moreover, it seems to me that if anything, the reduction in the number of respondents is likely to result in a reduction in the length of the hearing below that which informed the exercise of my discretion on 2 April. 9 I have taken into account the submissions put to me with suitable clarity and force by Mr Ng and Mr Potts as to the amount of costs which will be incurred by their clients, and the relatively small percentage which is covered by the order for security. However, as I said on the last occasion, the respondents are not entitled to a full indemnity for their party and party costs and the basis of my exercise of discretion was also informed by the fact that Mr O'Neil's undertaking to meet the costs was a factor to be taken into account. 10 It therefore seems to me that the threshold required for the exercise of my discretion today, that is to say the demonstration of changed circumstances, has not been made out and it follows that I propose to make orders dismissing both of the applications. 11 I will order the remaining respondents to pay the costs of this application. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson. Associate: Dated: 27 May 2014