Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 7) [2011] FCA 689 (17 June 2011)

Last Updated: 21 June 2011

FEDERAL COURT OF AUSTRALIA

Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 7) [2011] FCA 689

Citation:		Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 7) [2011] FCA 689
Parties:		OLIVAYLLE PTY LTD (ACN 080 670 640) (ADMINISTRATORS APPOINTED) v FLOTTWEG AG (FORMERLY FLOTTWEG GMBH & CO KGAA) (ABN 95 101 547 424)
File number:		SAD 261 of 2006
Judge:		LOGAN J
Date of judgment:		17 June 2011
Catchwords:		COSTS – claim against non-party – unsuccessful party in administration and unable to meet substantial costs order – non-party played active part in litigation and failure to settle the matter – non-party is director and controlling shareholder of the applicant – respondent twice sought security for costs unsuccessfully – where non-party misrepresented to the Court the true liabilities of the unsuccessful party – jointly against unsuccessful party and non-party
Legislation:		Corporations Act 2001 (Cth) s 1335, Pt 5.3A Federal Court of Australia Act 1976 (Cth) s 43 Federal Court Rules (Cth) O 62 r 4(2)(c)
Cases cited:		Gore v Justice Corporation Pty Ltd (2002) 119 FCR 429 considered Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178 applied NAGM v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCAFC 396; (2002) 125 FCR 488 applied Olivaylle Pty Ltd v Flottweg GMBH & CO KGAA [2010] FCAFC 62 cited Olivaylle Pty Ltd (ACN 080 670 640) v Flottweg GMBH & CO KGAA (ABN 95 101 547 424) [2007] FCA 56 cited Olivaylle Pty Ltd (ACN 080 670 640) v Flottweg GMBH & CO KGAA (ABN 95 101 547 424) (No 2) [2007] FCA 1892 cited Olivaylle Pty Ltd v Flottweg GMBH & CO KGAA (No 4) [2009] FCA 522; (2009) 255 ALR 632 cited Olivaylle Pty Ltd v Flottweg GMBH & CO KGAA (No 5) [2009] FCA 571 cited Olivaylle Pty Ltd v Flottweg GMBH & CO KGAA (No 6) [2011] FCA 688 cited Vestris v Cashman (1998) 72 SASR 449 applied
Date of hearing:	2 June 2011
Date of last submissions filed on behalf of the Respondent:	15 June 2011
Place:	Brisbane (via videolink to Adelaide and Sydney)
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	39
Solicitor for the Applicant:	Minter Ellison
Counsel for the Respondent:	Mr M Hoffmann QC
Solicitor for the Respondent:	Fisher Jeffries as town agents Baker McKenzie
Mr Jorge de Moya (non-party to principal application and respondent to costs application by respondent):	Mr Jorge de Moya did not appear

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	SAD 261 of 2006

BETWEEN:

OLIVAYLLE PTY LTD (ACN 080 670 640) (ADMINISTRATORS APPOINTED) Applicant

AND:	FLOTTWEG AG (FORMERLY FLOTTWEG GMBH & CO KGAA) (ABN 95 101 547 424) Respondent

JUDGE:	LOGAN J
DATE OF ORDER:	17 JUNE 2011
WHERE MADE:	BRISBANE (VIA VIDEOLINK TO ADELAIDE AND SYDNEY)

THE COURT ORDERS THAT:

1. Jorge de Moya is jointly and severally liable with the applicant to meet the costs ordered to be paid by the applicant by paragraphs 1, 2 and 3 of the order made on 17 June 2011 and by the order made on 28 May 2009.
2. Save in respect of the costs ordered to be paid by the applicant pursuant to paragraphs 2 and 3 of the order made on 17 June 2011, recovery of its costs by the respondent from Jorge de Moya pursuant to paragraph 1 of this order is stayed, pending the determination by taxation, agreement or fixing in gross of the amount of the set off referred to in paragraph 2 of the order made on 28 May 2009 and paragraph 1(b) of the order made on 17 June 2011 or further earlier order.
3. Jorge de Moya is to pay the respondent’s costs of and incidental to its application filed on 19 May 2011, to be taxed if not agreed or fixed in gross.
4. Liberty to apply on two clear business days notice is reserved to the respondent, the applicant (including its administrators and any liquidator who may come to be appointed) and Jorge de Moya.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	SAD 261 of 2006

BETWEEN:	OLIVAYLLE PTY LTD (ACN 080 670 640) (ADMINISTRATORS APPOINTED) Applicant
AND:	FLOTTWEG AG (FORMERLY FLOTTWEG GMBH & CO KGAA) (ABN 95 101 547 424) Respondent

JUDGE:	LOGAN J
DATE:	17 JUNE 2011
PLACE:	BRISBANE (VIA VIDEOLINK TO ADELAIDE AND SYDNEY)

REASONS FOR JUDGMENT

1. For reasons separately given by me in a judgment also published today, Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 6) [2011] FCA 688, I have granted an application by Flottweg that its costs be fixed in gross pursuant to O 62 r 4(2)(c) of the Federal Court Rules (Cth). The orders that I made on that application included that:

(a) Flottweg is entitled, as against Olivaylle, in respect of all its costs of and incidental to the proceedings in the original jurisdiction, including those ordered to be paid on an indemnity basis, but exclusive of those of and incidental to the application for the fixing of its costs in a gross sum, to a gross sum of $1,102,500.00 instead of taxed costs; and

(b) the costs as so fixed are subject to the set off provided for by the order of 28 May 2009 in respect of costs awarded in favour of the applicant.

I also ordered that Olivaylle pay Flottweg’s costs in respect of the application for the fixing of its costs which, in turn, I fixed in the sum of $8,500.00.

2. That particular application was a sequel to the dismissal of Olivaylle’s principal application in this proceeding, Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 4) [2009] FCA 522; (2009) 255 ALR 632 and to consequential costs orders which I made upon that dismissal: Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA (No 5) [2009] FCA 571. A later appeal by Olivaylle to the Full Court was dismissed: Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA [2010] FCAFC 62.
3. These reasons for judgment must be read in conjunction with each of these earlier judgments and also with two judgments, to which I refer below, earlier delivered by Finn J in this proceeding.
4. In the present application Flottweg seeks an order that Mr Jorge de Moya (Mr de Moya) pay its costs of the proceedings in the original jurisdiction either in such lump sum amount as ordered by the Court or in an amount as taxed or agreed. An application of a similar kind was made in respect of the appeal to the Full Court but this was not, in the result, pressed.
5. This application is thus another sequel to the dismissal of the principal application. Even more so, is it a sequel to the recent placement of Olivaylle into administration under Pt 5.3A of the Corporations Act 2001 (Cth) (Corporations Act) and to what was put before the Court by or on behalf of Olivaylle at the time when the then docket judge, Finn J, heard and determined, adversely to Flottweg, two successive, interlocutory security for costs applications which it had brought prior to the commencement of the trial: Olivaylle Pty Ltd (ACN 080 670 640) v Flottweg GMBH & Co KGAA (ABN 95 101 547 424) [2007] FCA 56 and Olivaylle Pty Ltd (ACN 080 670 640) v Flottweg GMBH & Co KGAA (ABN 95 101 547 424) (No 2) [2007] FCA 1892. Olivaylle was placed in administration on the very day on which Flottweg’s application for the fixing of its costs was heard.
6. Mr de Moya is not a party to the proceeding. The applicant party in the proceeding is Olivaylle which has, at all material times, acted as the trustee of a unit trust, the Olivaylle Unit Trust. There is no doubt though that Olivaylle is an alter ego of Mr de Moya. He is its sole director, company secretary and shareholder. He is very much a family patriarch. He was the driving force behind Olivaylle’s development of its olive grove and production line and also, I am quite sure, this proceeding. I am satisfied that Mr de Moya has been served with the application. As was his right, he chose not to appear at its hearing.
7. There is no doubt that the Court’s power to award costs, conferred by s 43 of the Federal Court of Australia Act 1976 (Cth), extends to the awarding of costs against a non-party: Gore v Justice Corporation Pty Ltd (2002) 119 FCR 429 at [24]. The existence of the power is one thing, whether there is occasion for its exercise in the circumstances of this case is quite another. That is because the awarding of costs against a non-party is an exceptional step and the power so to do is not one lightly to be exercised: NAGM v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCAFC 396; (2002) 125 FCR 488 at [68] (NAGM); Vestris v Cashman (1998) 72 SASR 449. The purpose of making such an order is compensatory, not punitive, so as “to reimburse to a party costs which that party has incurred by reason of the conduct of the non-party”: NAGM at [66]. The absence of an appearance by Mr de Moya as a contradictor most certainly does not mean that an order against him in respect of costs follows as a matter of course. It remains the case that the discretion to award costs against him as a non-party is one to be exercised with caution and only if warranted by the singular circumstances of this case.
8. Flottweg submitted that the present was a case which fell within the category described by the Mason CJ, Deane and Gaudron JJ in a leading case, Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178 at 192-193:

For our part, we consider it appropriate to recognize a general category of case in which an order for costs should be made against a non-party and which would encompass the case of a receiver of a company who is not a party to the litigation. That category of case consists of circumstances where the party to the litigation is an insolvent person or man of straw, where the non-party has played an active part in the conduct of the litigation and where the non-party, or some person on whose behalf he or she is acting or by whom he or she has been appointed, has an interest in the subject of the litigation. Where the circumstances of a case fall within that category, an order for costs should be made against the non-party if the interests of justice require that it be made.

Olivaylle, it was submitted, was but a straw company as to the worth of which there had been an absence of candour on its part before Finn J when the security for costs applications were heard. Mr de Moya, it was submitted, had played an active part in the conduct of the litigation by Olivaylle and either he or interests controlled by him had an interest in the subject of the litigation.

9. The basis upon which Flottweg has cast its application requires an examination of the course of this proceeding from its early interlocutory stages to the final dismissal with costs of the principal application.
10. The proceeding was commenced on 16 November 2006. Flottweg made an application for security for costs pursuant to s 1335 of the Corporations Act promptly. It made its application in January 2007. This application was dismissed by Finn J on the basis, inter alios, that “there is no credible evidence establishing that there is reason to believe there is a real chance that Olivaylle would be unable to pay Flottweg’s costs if it was successful in its defence [of the proceedings]” ([2007] FCA 56 at [16]).
11. Thereafter, pre-trial discovery ensued. Given the nature of the damages claim, documents relating to Olivaylle’s financial position, including who were its creditors and any indulgences it had received from creditors were directly relevant and discoverable. Flottweg obtained discovery of and inspected and copied financial statements for the Olivaylle Unit Trust. As Olivaylle acted solely in its capacity as corporate trustee there were no separate corporate financial statements in respect of any trading by it in its own right. These statements disclosed:

(a) a deficiency in trust funds of $7,563,793; and

(b) a term loan debt of $13,388,110 to Atalaya Corporation.

12. Atalaya Corporation is a company incorporated in the Cook Islands of which Mr de Moya is a director.
13. Prompted by the information which it had obtained on discovery, Flottweg made, in September 2007, a second application for security for costs. The material before me on the present application included the written outline of submissions made by counsel on behalf of Olivaylle to Finn J on the hearing of that second security for costs application. A transcript of the hearing of that application was also in evidence.
14. It is fair to say, by reference to Olivaylle’s submissions, written and oral, on the hearing of that second security for costs application, that the company put to Finn J that it had assets available to satisfy a costs order and this was demonstrated on the face of the company’s accounts. It was further put that any creditors of Olivaylle were unsecured.
15. This second security for costs application was dismissed, again on the basis that there was no reasonable grounds for apprehending that, in the event that Olivaylle was unsuccessful in its claim, it would not be supported by its financiers and allowed to be wound up. Finn J stated ([2007] FCA 1892, at [9]):

I am in consequence unprepared to make the order for security that is sought. I would, though, acknowledge that those who stand behind this company do have a real interest in the litigation and are likely to be beneficiaries of it should it be successfully prosecuted. It may well be the case that, if at the end of the day Olivaylle is unsuccessful and a costs order is made, a case may be able to be made for a third party cost order. I express no view on the appropriateness or otherwise of such an order.

16. A mediation in respect of Olivaylle’s claim was conducted in June 2007. Mr de Moya attended that mediation on behalf of Olivaylle.
17. Olivaylle’s financial statements for the year ended 30 June 2008 disclose a loss for that financial year of $3.5M and an increase in accumulated losses from $9M to $12.9M. Those accounts also disclose an indebtedness to Atalaya Corporation in the amount of $17.795M. The notes to those accounts in respect of who constitute creditors of Olivaylle make no reference to DMG Properties LLLP.
18. Documents produced to the Court by notice to the administrators from Flottweg and tendered in evidence on the hearing of the application disclose that Atalaya Corporation was providing funds to Olivaylle pursuant to what is described as a “revolving line of credit promissory note” (credit facility) apparently signed and dated on 14 January 1998 but with a specified “effective date” of 15 December 2005. That credit facility has been signed by Mr de Moya in his capacity as the managing director of Olivaylle and, separately, in his capacity as a director of Atalaya Corporation. Each of these companies is termed the “Maker” in the promissory note. The credit facility commences with the following recital:

FOR VALUE RECEIVED, the undersigned Jorge de Moya, in his capacity as a duly authorized officer of Olivaylle Pty Ltd, an Australian Company (080 670 640) registered on 12 November 1997 (“First Trustee”) which is the First Trustee of the Olivaylle Unit Trust, a Unit Trust formed on January 14, 1998 under the Trustee Act of 1936 which in turn is 100% owned by its parent corporation Atalaya Corporation, a Cook Islands Corporation (all of the foregoing hereinafter referred to as the “Maker”), promise to pay to the order of DMG Properties, LLLP, a Florida limited liability company (“Payee”), in lawful money of the United States, up to the principal amount of Fifteen Million Dollars ($15,000,000) (“Revolving Credit Note”).

19. This recital refers to DMG Properties LLLP as a limited liability company but there is other evidence in the form of public record searches which discloses that it is a limited partnership constituted under the laws of the State of Florida in the United States of America.
20. Apparently pursuant to the credit facility (Article 3), DMG Properties LLLP registered a fixed and floating charge over Olivaylle’s assets in its favour on 17 July 2009. By that date, Olivaylle’s claim had been dismissed with costs by me although the Full Court had yet to hear and determine its appeal. Later, by a letter to Olivaylle dated 3 February 2010, DMG Properties LLLP made a demand for interest outstanding under the credit facility. That letter, which was also produced by the administrators on notice to them by Flottweg was tendered in evidence. That letter recites that Olivaylle and DMG Properties LLLP had agreed to defer interest payments due under the credit facility on 1 January 2007, 1 January 2008 and 1 January 2009 “due to delays in the implementation, marketing and sales of high quality olive oils”.
21. Olivaylle’s financial statements for the year ended 30 June 2009 disclose a loss for that financial year in the order of $2.8M and accumulated losses of about $15.2M. The accounts also disclose an indebtedness to Atalaya Corporation in the amount of $19.956M. Again, the notes to the accounts in respect of the identity of Olivaylle’s creditors make no reference to DMG Properties LLLP.
22. Administrators were appointed to Olivaylle on 28 March 2011. A first meeting of creditors of the company was convened on 7 April 2011. At that time, DMG Properties LLLP claimed that Olivaylle was indebted to it in the amount of $19,527,081.05. A number of members of Mr de Moya’s family also claimed to be owed money by Olivaylle pursuant to promissory notes granted in their favour by Olivaylle. These promissory notes were also produced on notice by the administrators and tended in evidence by Flottweg. They follow a standard form. Though each has expressed to have an “effective date” of 8 January 1998, each is apparently executed on behalf of Olivaylle by Mr de Moya in his capacity as managing director in favour of the promisee in December 2003. The indebtedness they record may be summarised in the following table:

Promissory Note No.	De Moya Family Member	Amount	Date
1.	Fernando De Moya	$539,048.18	8 January 1998
2.	Maria MacDonnell	$151,216.71	8 January 1998
3.	Alvaro de Moya	$1,529,865.11	8 January 1998
4.	Francisco De Moya	$252,529.09	8 January 1998
5.	Maria C De Moya	$430,655.46	8 January 1998
6.	Christopher De Moya	$24,825.72	8 January 1998
7.	Armando De Moya	$807,999.04	8 January 1998
8.	Alisa De Moya	$807,992.02	8 January 1998
9.	Jorge Juan De Moya	$1,099,209.65	8 January 1998

Jorge Juan de Moya, the lender identified in item 9 in the table, is not to be confused with the respondent to Flottweg’s application. He is a son of Mr de Moya.

23. It is not necessary for the purpose of the present application to determine whether, other than between the parties to each such promissory note, the specification of an earlier “effective date” had any efficacy. However one approaches the indebtedness recorded in the table, it preceded each of the security for cost applications made by Flottweg before Finn J.
24. Further, a comparison between the accounts of Olivaylle, as discovered and put in evidence before Finn J on the hearing of the second application and the indebtedness of Olivaylle claimed by the various family members to the administrator pursuant to the promissory notes discloses some inconsistencies. There are inconsistencies between the indebtedness of Olivaylle as recorded in these accounts and that put to the administrator. The inconsistencies are both as to the amount and the identity of creditors.
25. Yet further, the existence of the credit facility supporting an advance by DMG Properties LLLP was not discovered by Olivaylle in the proceeding. The later document is not altogether easy to construe in that both Olivaylle and Atalaya Corporation are “Makers”. On one construction of the document there may be no inconsistency arising from an absence of reference in Olivaylle’s accounts to DMG Properties, LLLP. It may be that the flow of funds was from DMG Properties, LLLP to Atalaya Corporation, which, in turn, on lent funds to Olivaylle.
26. The other construction of it and one which would explain the charge in favour of DMG Properties LLLP by Olivaylle, is that the liability created was joint. Yet another is that the notes to the accounts specifying Atalaya Corporation, rather than DMG Properties LLLP as a creditor were erroneous.
27. The administrators lodged a written submission with the Court in which it was asserted that their investigations disclosed that the funds provided under the credit facility were advanced to Olivaylle by DMG Properties LLLP rather than Atalaya Corporation. They did not elaborate on what was the supporting evidence, disclosed by their investigations, for this assertion.
28. It is not necessary for the purposes of determining this application to resolve whether DMG Properties LLLP, rather than Atalaya Corporation was lender to Olivaylle. In any event, the credit facility document was discoverable and one relevant not just to the claim on the principal application but also to the question of whether security for costs should be ordered.
29. In respect of the applications which it made for security for costs it was Flottweg which bore the onus of proving that the making of such an order was warranted on the evidence. That said, insofar as Olivaylle sought to meet those applications by evidence and submissions it had a duty not to mislead the Court. The person with the intimacy of knowledge as to the financial affairs of Olivaylle, who were its principal creditors and which family members had lent money to it was Mr de Moya.
30. In Vestris v Cashman (1998) 72 SASR 449 at 468, in a judgment with which Doyle CJ agreed, Lander J, then a judge of the South Australian Supreme Court, offered a helpful summary of factors which are relevant to the exercise of the discretion as to whether to award costs against a non-party:

In exercising the discretion regard would be had to whether the non-party could have been joined as a party earlier in the proceedings and thereby obtained the protection of the rules of court; whether the non-party has had any warning that an application for costs against that party would be made; whether, in those circumstances, the non-party could have applied to be joined in the proceedings and thereby had the capacity to influence the proceedings or the non-party could have protected itself by making an offer in accordance with the rules; whether if a warning had been given the non-party could have terminated the proceedings by discontinuance, negotiation, payment or otherwise; whether the party who would otherwise be usually liable for costs can meet an order for costs and if relevant the reason why that party cannot meet an order for costs; whether it was apparent at any earlier stage in the proceedings, and if so when, that the party could not meet costs; whether the moving party should have sought an order for security for costs; the relationship, if any, between the non-party and the party who would usually be liable for costs; whether the non-party has caused the proceedings; whether the non-party has funded the proceedings; whether the non-party stood to benefit by the litigation and if so how; whether the non-party had a direct or indirect financial interest in the litigation; and whether there has been any improper conduct on the part of the non-party.

None of the matters will necessarily be decisive. Indeed the presence of one or more of those matters does not inexorably lead to the conclusion that an order for costs should be made against a non-party.

31. As to these factors, Flottweg did not itself at an early stage put Mr de Moya expressly on notice that he may be in jeopardy of being made personally liable for its costs. It had no need so to do. That it had brought two security for costs applications was itself eloquent. Further and more importantly, that Mr de Moya may be in such jeopardy personally had already been made clear by Finn J both during the hearing of one of Flottweg’s security for costs applications and in his judgment in respect of the second security for costs application. There is no evidence that Mr de Moya was personally present in court when Finn J made his observation in the course of submissions but equally there is no evidence that either this observation, or that in the judgment, did not then come to his attention. There is evidence that he attended a pre-trial mediation on behalf of Olivaylle. I well recall his regular attendance at the trial of the proceeding. He was also a principal witness for Olivaylle in the trial. There was ample evidence at the trial and not only from Mr de Moya himself, of the intimacy of his involvement in Olivaylle’s affairs. Given this involvement, I am well satisfied that an inference is open that at least the judgment, when Finn J sounded a cautionary note with respect to the possibility of a personal costs liability, if not also the observation his Honour made in the course of submissions, came to Mr de Moya’s attention.
32. In these circumstances, Mr de Moya could hardly be said to have been lulled into a false sense of security as to Flottweg’s apprehension as to Olivaylle’s ability to meet a costs order in the event that the principal application did not succeed or with respect to the comprehensive sufficiency of Olivaylle’s corporate veil in negating any possibility of his being in personal jeopardy of a costs liability.
33. Mr de Moya could not have been joined as a party to this proceeding. He did though have a capacity to influence the proceedings and any related attempt to compromise them via his control of Olivaylle. It is also apparent from a credit facility that Mr de Moya is a director of the holder of the units in the Olivaylle Unit Trust namely, Atalaya Corporation. On the evidence, Mr de Moya controls Atalaya Corporation. There is an inference available that he and members of his immediate family had the prospect, directly or indirectly, of benefiting from this litigation in the event that Olivaylle was successful.
34. Taking at face value what has emerged since Olivaylle was placed in administration as to its indebtedness in 2007, it is patent that Olivaylle did not place before Finn J the full picture when making submissions or adducing evidence as to its finances. That was not the fault of its legal advisers but rather of its controller, Mr de Moya. There is no doubt that this full picture would have been influential in terms of persuading his Honour that the case was one for the ordering of security for costs. Olivaylle twice actively opposed the ordering of any security for costs, on the latter occasion after purportedly giving discovery in respect of its financial position. It failed to mention DMG Properties LLLP, the credit facility to which that limited partnership was a party, that it had already granted to Olivaylle a deferral of an interest payment under the credit facility due on 1 January 2007 or the full nature and extent of Olivaylle’s indebtedness to members of Mr de Moya’s immediate family. These are most significant considerations, especially in respect of a company which was wholly dependent for its solvency on the ongoing support of its creditors. They tell adversely against Mr de Moya in relation to the discretion to award costs against him. In the month which preceded the second of the security for costs applications there occurred, as I found in my costs judgment following the trial, an imprudent refusal by Olivaylle of an offer of compromise. Necessarily, given his control of Olivaylle, that refusal could only have been made on Mr de Moya’s instructions. Thereafter, Flottweg was subjected to a lengthy and expensive trial. The damages initially claimed by Olivaylle were, in the course of the trial, progressively and necessarily reduced.
35. On the evidence to hand, there is little, if any, prospect that Flottweg would recover anything in respect of its costs were Olivaylle to be would up.
36. Weighed together, these factors well justify, in my opinion, the exceptional course of making an order for costs against Mr de Moya personally.
37. As to the amount of those costs, it does not automatically follow that a non-party should be made liable for all of the costs awarded in favour of the successful party. Like the non-party’s liability itself, the amount of that liability must emerge from and relate to the circumstances of the particular case.
38. In this case and recalling the compensatory nature of the order, Mr de Moya’s liability should wholly conform to that of Olivaylle. The amount of those costs has been fixed. Like Olivaylle though, Mr de Moya should have the benefit of the setting off from that liability of the amount as taxed, agreed or fixed in respect of costs orders made in favour of Olivaylle in the course of the proceeding. Until the amount of that set off is ascertained and his net liability established, there should be a stay of proceedings for recovery against him personally.
39. There will be orders accordingly.
    

I certify that the preceding thirty-nine (39) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan.

Associate:

Dated: 17 June 2011