Vertical Australia Pty Ltd v Air Company Vertical-T LLC; Air Company Vertical-T LLC v Vertical Australia Pty Ltd [2012] NSWSC 719

Supreme Court New South Wales

Medium Neutral Citation: Vertical Australia Pty Ltd v Air Company Vertical-T LLC; Air Company Vertical-T LLC v Vertical Australia Pty Ltd [2012] NSWSC 719 Hearing dates: 20 June 2012 Decision date: 27 June 2012 Jurisdiction: Equity Division Before: Ward J Decision: Order for payment of moneys out of Court in interpleader proceedings (11/408815) Order for security for costs in the Breach of Agency proceedings (11/411472) Catchwords: PRACTICE AND PROCEDURE - application for payment of moneys out of Court - application pursuant to r 25.3(3) Uniform Civil Procedure Rules 2005 (NSW) or in the alternative pursuant to s 95 Trustee Act 1925 (NSW) - application by Vertical-T with respect to moneys held by Vertical Australia, initially Australian agent for Vertical-T - other potential claimant Wellman Limited, a company incorporated in Cyprus, which had previously acted as intermediary between Vertical Australia and Vertical-T - HELD - satisfied that Vertical-T has established claim to moneys

COSTS - application for payment out of Court brought by Vertical Australia on interpleader procedure - Vertical Australia seeks costs of application - whether unreasonable or premature for Vertical Australia to commence proceedings - HELD - proceedings were not commenced unreasonably or prematurely - cost application granted

PRACTICE AND PROCEDURE - application for security for costs by Vertical Australia - claim for retention of moneys paid into Court in the interpleader proceedings - whether position of Vertical Australia is analogous to a trustee with respect to right of indemnification from trust property - whether in analogous situation trustee would have right to indemnification - no equitable lien claimed - power to order security for costs is discretionary - objective is to assess sufficient security that is just in all the circumstances of the case - where uncertainty as to actual costs which will be incurred in conduct of proceedings - HELD - security for costs to be provided on a staged basis Legislation Cited: Corporations Act 2001 (Cth) Trustee Act 1925 (NSW) Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: Agar v Hyde (2000) 201 CLR 552 Agusta Pty Ltd v Official Trustee In Bankruptcy As Trustee of Estates of Gustavo Ferella and Angelo Ferella [2009] NSWCA 129 Allstate Life Insurance Co v Australia and New Zealand Banking Group Ltd (No 19) (1995) 134 ALR 187 ANZ v Maunder [2009] NSWSC 1356 Australian Building & Technical Solutions Pty Ltd v Boumelhem; Boral Australia Ltd v Boumelhem; Boumelhem v Jones [2009] NSWSC 460 Australian Iron & Steel Pty Ltd v Jumbo Scheepvaart Maatschappij (Curacao) NV (1988) 13 NSWLR 507 Brocklebank & Co v King's Lynn Steamship Co (1878) 3 CPD 365 Brundza v Robbie & Co (No 2) (1952) 88 CLR 171 Bryan Fencott & Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 Commonwealth Bank v Estate of late Slieman [2010] NSWSC 661 Concorde Enterprises Ltd v Anthony Motors (Hutt) Ltd (No 2) [1977] 1 NZLR 516 Del Bosco v Outtrim [2008] NSWSC 105 Electrona Carbide Industries Pty Ltd v Tasmanian Government Insurance Board [1985] Tas R 68 Equity Access Ltd v Westpac Banking Ltd [1989] ATPR 40-972 Fiduciary v Morningstar Research [2004] NSWSC 664 Harmer v Federal Commissioner of Taxation (1991) 173 CLR 264 Harvey v Jacob (1817) 106 ER 59 Idoport Pty Ltd v NAB Ltd [2001] NSWSC 744 In re Rhodesia Goldfields, Limited Patridge v Rhodesia Goldfiends, Limited [1907 R 454] [1910] 1 Ch 239 JA Pty Ltd v Jonco Holdings Pty Ltd [2000] NSWSC 147; (2000) 33 ACSR 691 JWH Turner & Co Ltd v O'Riordan (1923) 40 WN (NSW) 64 K P Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189 Kennett v Charlton [2007] NSWSC 190 Lemery Holdings Pty Ltd v Reliance Financial Services Pty Ltd [2008] NSWSC 1344 MA Productions Pty Ltd v Austarama Television Pty Ltd (1982) 7 ACLR 97 McPherson Thom & Co v Coombie Pastoral Co Pty Ltd [1929] VLR 295 Massey v Allen (1879) 12 Ch D 807; JWH Turner & Co Ltd v O'Riordan (1923) 40 WN (NSW) 64 Menhaden v Citibank NA (1984) 1 FCR 542 MHG Plastic Industries Pty Ltd v Quality Assurance Services Pty Ltd [2002] FCA 821 Mokau Timber Co v Berry (1908) 11 GLR 212 Morris v Hanley [2001] NSWCA 374 Nelson Capital Pty Ltd v Short [2003] WASC 152 Plaza Print Pty Ltd v South British Insurance Co Ltd (1984) 68 FLR 340 Re Application of Macedonian Orthodox Community Church St Petka Inc [2006] NSWSC 392 Re PILT Nominees Pty Ltd (Unreported, 2909/2009, White J) Ruth Chong v Super Equity Invests Pty Ltd & Anor [2012] NSWSC 27 Sharjade v Darwinia Estate & Anor [2006] NSWSC 708 Southern Cross Exploration NL v Fire & All Risks Insurance Co Ltd (1985) 1 NSWLR 114 Southern Wine Corporation Pty Ltd (in liq) v Frankland River Olive Co Ltd [2005] WASCA 236; (2005) 31 WAR 162 Sunday Times Newspaper Company Ltd v Mcintosh (1933) 33 SR (NSW) 371 Szanto v Bainton [2011] NSWSC 985 Transocean Capital Pty Ltd v AFSIG Pty Ltd [2006] NSWSC 806 Tyne Improvement Cmrs v Armement Anversois S/A (The Brabo) [1949] AC 326 Westpac Banking Corporation v Commonwealth Steel Ltd [1983] 1 NSWLR 735 William Buck Pty Ltd v Perception Pty Ltd [2006] VSC 385 Wollongong City Council v FPM Constructions Pty Ltd [2004] NSWSC 523 X v A [2000] 1 All ER 490 Xebec Pty Ltd (in liq) v Enthe Pty Ltd (1987) 18 ATR 893 Texts Cited: J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (7th ed, 2006) Category: Interlocutory applications Parties: 10/411472 Air Company Vertical T-LLC, a company registered in the Russian Federation, No 102690191450 (Plaintiff) Vertical Australia Pty Ltd (ACN 147 916 961) (First Defendant) Yuri Tchernobryvko (Second Defendant)