Case: Energy Drilling Inc. v Petroz N.L. [1989] ATPR 40-954
Outcome: cited
Energy Drilling Inc. v Petroz N.L. [1989] ATPR 40-954 ( Energy Drilling) , Gummow J said (at p 50,422): The purpose of ordering security for costs against an applicant ordinarily resident outside the jurisdiction is to ensure that a successful respondent will have a fund available within the jurisdiction of this Court against which it can enforce the judgment for costs, so that the respondent does not bear the risk as to the certainty of enforcement in the foreign country and as to the time and complexity of the action there which might be necessary to effect enforcement : Kent Heating Ltd. V. Cook-on-Gas Products Pty. Ltd. &amp; Anor (1984) 59 A.L.R. 277 at p. 279. On the other hand, the mere circumstance that an applicant is resident outside the jurisdiction does not necessarily invite an exercise of discretion in favour of ordering security, the question being how justice will best be served in the particular case: Barton v. Minister for Foreign Affairs [1984] FCA 89 ; (1984) 2 F.C.R. 463 ; CBS Records Australia Ltd. &amp; Ors v. Telmak Teleproducts (Aust.) Pty. Ltd. (1987) ATPR p40-783 at pp. 48,554-48,555, (1987) 72 A.L.R. 270 at pp. 284-285. [My emphasis] The applicants submit that I should find that they would be likely to satisfy any adverse costs order and that this consideration, made on the basis of evidence of what they submit are assets available within the jurisdiction and other factors, should lead me to refuse Lodestar's application. The applicants refer to: the very significant resources of both applicants, but particularly Rare Breed, outside the jurisdiction; the presence of significant intangible assets within the jurisdiction; evidence of a concrete long-term commitment to doing business in Australia on the part of the applicants; a record of the applicants satisfying costs orders against them in overseas litigation between the same parties whenever such orders have been made; and the availability of reciprocal enforcement mechanisms in the applicants' "home" jurisdictions in the United States of America. Lodestar, on the other hand, submits that the "assets within the jurisdiction" on which the applicants rely are so problematical that they do not displace a presumption that is made in favour of an award of security in the case of foreign resident applicants, and that I should not, in effect, "trust" the applicants merely on account of their capacity to pay and other considerations on which they rely and to which I will refer below. In effect, Lodestar submits that the Court should approach the matter from the viewpoint of a respondent seeking to enforce a costs order and inquire whether that respondent would be subject to an unacceptable disadvantage by reason of the foreign residence of the applicants. I do not think that the availability of registration in the USA overcomes the procedural disadvantage that Lodestar would suffer in enforcing its costs order. Enforcing a costs order in the United States would take time and money and involve complexity that would not attend enforcement in Australia. See Energy Drilling at p 50,422 per Gummow J noted at [21] above. (vi) Notice of contention By a notice of contention, Lodestar seeks: a finding that Austin Nichols lacked standing under s 92(1) of the TM Act as it stood at the time when the removal applications were lodged; a finding that there were circumstances that were an obstacle to the use of the trade mark in the relevant period; and an exercise of the residual discretion not to order removal in a manner different from the way in which that discretion was exercised. If Lodestar's first contention prevails, Lodestar will succeed even in relation to the issue on which it failed before the Delegate (see [10] above). The applicants argue that Lodestar's second and third contentions would similarly be expected to go to the whole of the goods covered, but I need not discuss this submission.