COSTS — where plaintiff was successful in application to set aside statutory demand — where plaintiff sought lump sum costs order — where plaintiff contended costs were disproportionate and inappropriate in context — where costs assessment was likely to be contested and further increase costs — where defendant contended he acted reasonably and grounds raised were arguable — where it is appropriate for costs to follow the event — defendant to pay plaintiff’s costs on a lump sum basis
Quick Take
1A statutory demand for a non-judgment debt that is not accompanied by a verifying affidavit as required by s 459E(3) of the Corporations Act is fundamentally defective and will inevitably be set aside; the absence of the affidavit is not a mere technical omission.
2A gross sum costs order is appropriate where the costs of litigation are already disproportionate to the amount at stake and would become more so if referred for formal assessment, particularly where the paying party has demonstrated a propensity to take unreasonable positions.
3Indemnity costs (reflected in the gross sum) may be warranted where a party serves and maintains a defective statutory demand after being given detailed notice of the defect and an opportunity to withdraw it.
