Platypus Impact Housing Australia Ltd v Elsegood

1. [1]

   The plaintiff, Platypus Impact Housing Australia Limited, brings these proceedings against the first defendant, Mr Jack Elsegood, and his associated company, Elsegood Holdings Pty Ltd. The proceedings were commenced on 1 July 2024.

2. [2]

   In its Commercial List Statement, Platypus summarises the “Nature of the Dispute” as follows:

3. [3]

   Earlier, in October 2023, Mr Elsegood served on Platypus a statutory demand for $200,000.

4. [4]

   Platypus’s pursuit of the Queensland development opportunity referred to in its Commercial List Statement required, amongst other things, that it pay deposits totalling $200,000 in connection with securing contracts and options for the purchase of the parcels of land comprising the development. Platypus paid these deposits in about September 2022 using money advanced to it by a third party, Mr Greg Pace. Mr Elsegood then repaid Mr Pace. Mr Elsegood alleges that the circumstances surrounding this arrangement gave rise to a debt of $200,000 payable to him by Platypus.

5. [5]

   Platypus sought to set aside Mr Elsegood’s statutory demand on the basis that it had an offsetting claim.

6. [6]

   McGrath J upheld that contention, [1] and ordered that Mr Elsegood’s statutory demand be set aside on the condition that Platypus, by no later than 18 July 2024, commence proceedings to vindicate its offsetting claim.

7. [7]

   These are those proceedings.

8. [8]

   In these proceedings, Mr Elsegood brings a cross-claim for the $200,000 the subject of his October 2023 statutory demand.

9. [9]

   Against that background, by Notice of Motion filed on 15 November 2024, Mr Elsegood and Elsegood Holdings seek an order that Platypus provide security for costs.

10. [10]

    The matter was in the motions list on 21 February 2025.

11. [11]

    The Court has received comprehensive submissions, including submissions in reply, from Ms Dyon for Mr Elsegood and Mr Ball for Platypus. I suggested, and the parties agreed, that I should deal with this matter on the papers.

12. [12]

    Platypus does not dispute that the threshold question of whether there is reason to believe that it could not meet an adverse costs order has been met.

A defensive claim?

1. [13]

   Platypus resists Mr Elsegood’s claim for security primarily upon the basis that, in substance, its claim is defensive in nature and that Platypus “is effectively in the position of a defendant”. [2]

2. [14]

   Mr Ball put the matter this way:

3. [15]

   These proceedings were, no doubt, commenced because of the condition that McGrath J imposed.

4. [16]

   But I do not see them as being defensive of Mr Elsegood’s claim for the $200,000. Platypus does not seek to impugn Mr Elsegood’s claim to be a creditor of Platypus in that amount.

5. [17]

   Rather, Platypus brings an entirely separate claim, albeit one also arising from the Queensland development referred to in Platypus’s Commercial List Statement.

6. [18]

   As Ms Dyon put in her submissions in reply:

7. [19]

   I do not see Platypus’s claim as being defensive in nature in the relevant sense.

8. [20]

   Subject to what follows, I propose to order that security be provided.

Costs order

1. [21]

   McGrath J ordered that Mr Elsegood pay Platypus’s costs of the statutory demand proceedings.

2. [22]

   Those costs have been assessed and are the subject of a costs certificate in the sum of $163,364.90. Mr Elsegood has sought a review of that determination, with the effect that the determination is currently suspended. [3]

3. [23]

   Mr Ball submitted that no order for security should be made unless and until Mr Elsegood pays Platypus’s costs of the statutory demand proceedings.

4. [24]

   Ms Dyon submitted that as the costs determination remains the subject of review, “and there is no evidence to suggest that the costs order will not be paid by [Mr Elsegood], this matter should have no bearing on the exercise of the Court’s discretion”.

5. [25]

   While it is true that there is no evidence that Mr Elsegood will not pay the costs order once the figure is finally determined, nor is there any assurance from Mr Elsegood that the amount will be paid.

6. [26]

   In the absence of any assurance from Mr Elsegood that he will pay the amount of costs as finally determined, and has the ability to do so, I do not propose to make any order for security until those costs are paid.

Quantum

1. [27]

   As to the quantum of security, Mr Elsegood and Elsegood Holdings seek security in the sum of some $308,000. Mr Elsegood has not adduced evidence from a costs assessor. Each party relies upon the competing contentions of their solicitors in these proceedings.

2. [28]

   The principal matter in contention is the extent to which Mr Elsegood’s estimate of costs takes into account the work already done, investigating the same factual circumstances, in the statutory demand proceedings.

3. [29]

   In that regard, Mr Elsegood’s solicitor, Mr Tan, deposed:

4. [30]

   The parties have exchanged detailed submissions directed to matters of granular detail concerning the appropriate quantum of an order for security for costs, including a table that goes into a considerable amount of detail concerning individual items.

5. [31]

   A necessarily broad brush approach is, however, required, and my conclusion is that the amount of security to be provided, once the costs order is satisfied, should be $185,000.

Conclusion

1. [32]

   The parties should bring in short minutes of order to give effect to these reasons.

2. [33]

   The costs of the application for security will be the defendants’ costs in the cause.