Case: CBS Records Australia Ltd v Telmak Teleproducts (Aust) Pty Ltd (1987) 72 ALR 270
Outcome: applied
In CBS Records Australia Ltd v Telmak Teleproducts (Aust) Pty Limited (1987) 72 ALR 270 (' CBS Records '), Bowen CJ said at 284-5: 'Counsel for the respondent also asked for an order for security for costs to be made ... in accordance with O 28, r3(1)(a). This rule certainly gives a discretion to the court to make an order for security. However, it appears to me that it is a discretion to be exercised upon rational grounds and any party applying for security carries the onus of establishing a case showing that security should be granted. The fact that an applicant is ordinarily resident outside Australia is a precondition to an application under that part of the rule but is not sufficient in itself, in my view, to induce the court to exercise its discretion to make an order, particularly in circumstances such as the present. No evidence was given to assist the court in relation to the amount which might be required for security. I am not persuaded that I should exercise the discretion conferred by O 28, r3(1)(a) to make an order for security for costs as asked by the respondent.' 6 Order 28 r 3 of the Federal Court Rules provides that, when considering an application for security for costs, the Court may take into account, among other things, that the applicant 'is ordinarily resident outside Australia'. The Commonwealth submitted that this is a factor to which great weight must be given in this case. 7 Whilst the applicant did not deny that his extra-territorial residence was a factor to be considered, he demurred as to the weight to be given to it, arguing that 'other circumstances' exist in this case. The applicant submitted that, by virtue of South Korean legislation and inferences to be drawn from the Foreign Judgments Act 1991 (Cth) ('the Act') and the Foreign Judgment Regulations 1992 (Cth) ('the Regulations'), the Commonwealth would be able to enforce any judgment for costs against the applicant in the District Court of South Korea. 8 Section 5(1) of the Act provides: ' If the Governor-General is satisfied that, in the event of the benefits conferred by this Part being applied to money judgments given in the superior courts of a country, substantial reciprocity of treatment will be assured in relation to the enforcement in that country of money judgments given in all Australian superior courts, the regulations may provide that this Part extends in relation to that country '. 9 Section 5 is in Pt 2 of the Act. The Regulations provide that South Korea is a country to which Pt 2 applies (see reg 3 and the Schedule to the Regulations). Regulation 4 provides that a court listed in the Schedule to the Regulations is a superior court for the purposes of the Act. The District Court of South Korea (the Republic of Korea) is so listed. 30 There is some evidence that the Korean costs would be under $1000. I agree with the Commonwealth that such evidence appears, on the face of it, not to be entirely persuasive. However the Commonwealth has avoidably left the Court to speculate about a proper or better estimate. That is very unsatisfactory. There are unavoidable occasions, for example in some cases of assessment of damages, where a court must engage in speculation in order to do a degree of justice, however imperfect. But courts should not seek out occasions to speculate nor should they do so to fill gaps which the litigant urging the speculation could readily have obviated. I consider it is inappropriate in the present case to act on an entirely speculative basis. If a party seeks security for costs it is reasonable for the Court to insist that at least the best practicable efforts at estimation of the relevant costs be made. CBS Records is in point here. What is at stake is a potential fetter, which may prove insuperable, to a party seeking relief being heard by the Court. 31 I accept that it is likely that there would be some costs in Australia associated with the Korean costs of execution but, again, I am disinclined to speculate about the extent of them. 32 It follows that there is no sound basis for a conclusion that the costs of executing in South Korea (including some 'double-handling' costs in Australia) would significantly exceed the costs of executing in Australia.