J Cummins Pty Limited v F & D Bonaccorso Pty Limited [2012] NSWSC 1062

Supreme Court New South Wales

Medium Neutral Citation: J Cummins Pty Limited v F & D Bonaccorso Pty Limited [2012] NSWSC 1062 Hearing dates: 20 August 2012 Decision date: 20 August 2012 Jurisdiction: Equity Division Before: Lindsay J Decision: Further security for costs granted. Security in support of undertaking as to damages refused. The costs of the motion to be costs in the proceedings. Catchwords: PRACTICE AND PROCEDURE - costs - security for costs Legislation Cited: - Cases Cited: - Texts Cited: - Category: Interlocutory applications Parties: J Cummins Pty Ltd (Plaintiff) F & D Bonaccorso Pty Ltd (Defendant) Representation: V.R.W. Gray (Plaintiff) M. Darke / M.J. Smith (Defendant) Parisi and Associates Lawyers (Defendant) File Number(s): 2011 / 304034

JUDGMENT Ex tempore 1The principal proceedings concern a development property at Strathfield. Both parties to the proceedings are corporations. The defendant is the registered proprietor. The plaintiff claims to have exercised an option to purchase the property. The principal of the plaintiff corporation - its sole director and shareholder - is a Mr John Campbell Hawkins. 2There is a dispute about the terms of the option which requires no close examination by the Court at this stage. By its summons (filed on 21 September 2011) the plaintiff seeks, inter alia, an order for rectification of the option agreement and an order for specific performance. The plaintiff lodged a caveat on the title to the property. Shortly after commencement of the proceedings, it obtained an order for a limited extension of the caveat. On 12 October 2011 Gzell J decided, at the end of a contested hearing that the caveat should be extended until further order. 3There is no dispute today that the plaintiff has an arguable case to advance at trial. The defendant's concession on this score follows, in part, the decision of Gzell J to extend the plaintiff's caveat. 4His Honour made an order for extension of the caveat conditioned upon Mr Hawkins providing to the Court an undertaking as to damages. That appears in paragraph 22 of his Honour's reasons for judgment. It appears, from paragraph 2 of those reasons, that the plaintiff offered that undertaking in answer to criticism of it as a $1 company. 5Pursuant to Gzell J's orders the plaintiff filed, electronically, an affidavit of Mr Hawkins apparently sworn on 18 October 2011. Paragraph 2 of that affidavit is in the following terms: "2. In accordance with the undertakings given to the Court on my behalf on 12th October 2011 I hereby give my personal undertaking to the court to submit to such order (if any) in respect of the Plaintiff Company as the court may consider to be just for the payment of compensation and costs (to be assessed by the court or as it may direct) to any person (whether or not a party) affected by the operation of the interlocutory order made on 12th October 2011 or undertaking or of any interlocutory continuation (with or without variation) of the interlocutory order or undertaking." 6The Court does not presently have possession of an original affidavit bearing the signature of Mr Hawkins. It should have, in case the undertaking needs to be enforced. Accordingly, I propose to direct that the original affidavit, or another affidavit freshly sworn, be filed within 14 days of today's date. 7Via an exchange of correspondence in mid-October 2011 (namely, a letter from the defendant's then solicitors dated 17 October 2011 and a reply from the plaintiff's solicitors dated 19 October 2011) the plaintiff offered to provide security for costs in the amount of $50,000. That led to an order for the provision of security for costs - a consent order made by the Court on 15 November 2011. 8There is no dispute that the plaintiff complied with that order by the payment of $50,000 into an account maintained by the solicitors for the defendant, the proceeds of the account being held by the solicitors as stakeholders, pending further order of the Court, as security for the defendant's costs of the proceedings. 9Since that time the parties' preparations for trial appear to have proceeded at a leisurely pace. At the time the plaintiff commenced proceedings by the filing of a summons, it also filed a statement of claim (on 21 September 2011). The defendant filed a defence on 8 December 2011. Although no formal orders appear to have been made to this effect, the parties appear to have shared a common assumption that the issues in the proceedings are to be defined by pleadings, and the evidence to be adduced at trial is to be adduced in the form of affidavits. There is, I think, no necessity to formalise that arrangement by a confirmatory order today. 10The only substantive affidavit apparently served in the principal proceedings to date is an affidavit sworn by Mr Hawkins on 20 September 2011 in support of the plaintiff's application for extension of its caveat. Reference has been made to it today, but it is not in evidence before me. Mr Gray, counsel for the plaintiff, today informed the Court that that affidavit compromises the whole of the evidence the plaintiff proposes to adduce in chief at the trial.