ASIC v Letten (No 14) – Mirvac cops indemnity costs in favour of the Reef House Property Receivers and a raft of parties

Following judgment in ASIC v Letten (No 13) (see my post reporting on that judgment here), Gordon J handed down her decision on costs on 18 October 2011 – ASIC v Letten (No 14) FCA 1174.

It makes for interesting reading. In short, Gordon J ordered Mirvac to pay the indemnity costs of the Receivers and the secured creditor Westpac. Notably, even though ASIC had not asked for it, her Honour even ordered Mirvac to pay ASIC’s costs on an indemnity basis.

Mirvac had submitted that its costs should be paid by the Receivers out of the fund held by them, or alternatively that there should be no order for costs against Mirvac. Again her Honour’s distillation of the principles is a useful reference (see [3-8]). In relation to the claim for indemnity costs, the Receivers produced a letter dated 18 February 2011 they had sent to Mirvac stating that its claim was misconceived and inviting them to withdraw it. Westpac had no such letter to rely upon, in its application for indemnity costs, but pointed to the lateness with which Mirvac raised some of its arguments, and that Mirvac’s arguments had failed in their entirety.

Gordon J held that there were “special or unusual features” justifying the Court exercising its discretion to award indemnity costs. Essentially, Mirvac failed to accept the Receivers’ adjudication of its claim for the termination fee. Moreoever, its claim failed “legally and factually”. For these reasons, her Honour awarded indemnity costs against Mirvac in favour of the Receivers, Westpac and, even though ASIC did not seek them, in favour also of ASIC [at 11].

One thought on “ASIC v Letten (No 14) – Mirvac cops indemnity costs in favour of the Reef House Property Receivers and a raft of parties

  1. Pingback: ASIC v Letten (No 15) – winding up orders made in the Federal Court | Carrie Rome-Sievers, Barrister

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