Security of costs applications – it pays to cooperate

Background

The recent case of Builtcom Properties 15 v Maxida International Alexandria Property Australia confirmed the depth of discretionary matters the Supreme Court of New South Wales (the Court) can take into account in ordering security for a party's costs.

The matter concerns a transaction dispute regarding the Defendant's sale of a property to the Plaintiff conditional upon final approval from the Defendant's Board. The Defendant's Board ultimately did not approve of the sale to the Plaintiff.

In this case, the Defendant filed an application seeking security for costs from the Plaintiff who were a shell company devoid of assets.

Security of costs order

The Court held that the Defendant's evidence met the requirements stipulated under r42.21 UCPR and s1335(1) of the Corps Act.