Case: Procon (Great Britain) Ltd v Provincial Building Co Ltd [1984] 1 WLR 557
Outcome: distinguished
Stephen Colbran notes in his text Security for Costs (Longman Professional, 1993) at 41, that prior to the enactment of the Supreme Court of Judicature Act 1873 (UK) [36 &amp; 37 Vict, c 66) security for costs did not apply to past costs and nor would further security be required for a new trial (although an interesting exception to this rule appears to be in the case of Harvey v Jacob (1817) 1 B &amp; Ald 159, 106 ER 59 where the plaintiff, having been convicted of a felony and receiving a sentence of transportation to Australia, was ordered to give security for costs retrospective and prospective). However in 2006 the discretion of the Federal Court vested by s 56 Federal Court Act and s 1335 Corporations Act is very broad, and there is nothing in the terms of either section which would in any way limit the discretion of the Court or its jurisdiction to order security for costs already incurred by the respondents. Indeed, a review of the case law indicates that it is not uncommon for courts to order security for costs already incurred. Examples of cases where such orders have been made are Brocklebank &amp; Co v King's Lynn Steam Ship Co (1878) 3 CPD 365; Massey v Allen (1879) 12 ChD 807; JWH Turner &amp; Co Ltd v O'Riordan (1923) 40 WN (NSW) 64; Estates Property Investment Corporation Ltd v Pooley (1975) 3 ACLR 256; Procon (Great Britain) Ltd v Provincial Building Co Ltd [1984] 1 WLR 557; and Bryan E Fencott (and see the discussion of this topic in Colbran at pp 291-292). 48 In my view there are, as Hill J said in Equity Access , a number of discretionary issues peculiar to the facts of the present case which are persuade me that it is not appropriate to order that costs of 10 days of the trial already heard be encompassed in an award for security for costs. They are as follows: 1. In cases where security for costs have been awarded in respect of costs already incurred, there is often a catalyst which distinguishes the case from the usual circumstance where security is awarded in respect of prospective costs, and therefore justifies the application. So, for example: &#8226; in Pooley , Procon and Bryan E Fencott the retrospectivity of the award for security was not in contention &#8226; in Turner and Pooley the respondents had only immediately prior to bringing the application discovered that the applicants were insolvent. In the case before me, no such catalyst is evident. 2. In my view it would be oppressive to require the first and third applicants to now pay security for costs for those 10 days of trial already held, when they could reasonably rely on the decision in Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 3) [2006] FCA 1498 as meaning that they were not subject to a security for costs order in respect of that part of the trial. Although Mr Bell on behalf of the respondents made no secret of the fact that, if the trial did not commence within the scheduled time, his clients would be making an application for security for costs in the sum of $200 000, in my view to allow the respondents to have security for costs which have already been denied would be unjust in the circumstances. 3. Following on from this point, I note that I had dismissed the application by the first and second respondents for security for costs for that part of the trial just heard, on the basis of delay in bringing that application . Notwithstanding that the matter has now been adjourned, that the respondents indicated that they would seek security for costs if the trial did not get underway, and that the respondents were prompt in renewing their call for security for costs in respect of the trial dates once it was clear that the trial would not conclude within the scheduled 10 days, nothing has occurred which impacts on the reasons I gave dismissing the application of the respondents in respect of security for costs for the 10 days of trial. 4. The fact that the trial was not completed within the 10 days could substantially be attributed to such actions which could properly be laid at the feet of the applicants including the failure of the applicants to comply with earlier directions in relation to exchanging objections to evidence (thus requiring valuable scheduled trial time to be spent dealing with such issues), an adjournment requested by the applicants for the entirety of Wednesday 15 November 2006, and the failure of a key witness of the applicants to appear at Court which required me to stand down the Court while I considered an appropriate ruling in the circumstances. Having said that, it appeared that, despite my formal direction that the parties seek to resolve objections to evidence in advance of the trial and further attempts by Counsel on this score, the respondents' objections to evidence required two days of trial time which was considerably more than had been anticipated. Further, while no blame at all attaches to Counsel the fact remains that the examination, cross-examination and re-examination of the second applicant extended over four days, which also appeared to be considerably more than had been anticipated. Accordingly, in light of these developments it would be unfair to lay fault for the failure of the trial to finish during the allotted time completely at the feet of the applicants.