1300 039 390Security for the costs of a party to a Supreme Court proceeding is held by the Senior Master, regardless of the form in which the security is provided. The Prothonotary no longer receives security for the costs of parties in any form.
Security for costs may be provided to the Court in the form of a cheque, or by way of an unconditional bank guarantee. An order is necessary in every case for security for costs to be received.
Please see the attached form of order for the provision of security for costs.
Security for costs by tender of a cheque
Section 113 of the Supreme Court Act 1986 states that all moneys paid into Court under an order of the Court are to be held by the Senior Master.
Therefore the cheque tendered should be payable to: ‘The Senior Master of the Supreme Court’.
The payment into Court must be accompanied by an authenticated copy of the relevant order, and within any time limit set out in that order. Practitioners are reminded of the operation of Rule 3.02(3) as to the extension of a time limit by consent without the need for a further or amending order.
The contact details of the party making the payment and the other relevant party or parties to the proceeding should also be provided with the cheque and the authenticated order, so that copies of the receipt can be provided to those parties. A copy of the receipt will also be placed on the Court file.
Payment out of funds held as security for costs
Funds may be paid out by an order of the Supreme Court, or by the written consent of all parties to the proceeding in the circumstance described in Rule 79.02(3).
It is often convenient for the order or agreement to provide for payment to the legal representative of the party or parties, and the payment may be made to a solicitor’s trust account by electronic funds transfer if the bank account details are provided to the Senior Master’s Office.
Interest is not payable
All interest derived from the investment of moneys in the nature of security for costs must be paid to the Consolidated Fund, in accordance with s. 128(2) of the Supreme Court Act 1986.
Security for costs by tender of a bank guarantee
The Senior Master has directed that the provision of a bank guarantee as set out below is a form of security which is acceptable to them, provided that it otherwise complies with the terms of the relevant order. The Prothonotary no longer receives bank guarantees, and no reference to the Prothonotary should be made in the order or in the guarantee.
The bank guarantee must be unconditional, and must not contain an end date. The original document, together with an authenticated copy of the order, must be provided to the Senior Master to be held pending further order.
The guarantee should be in favour of the party whose costs are being secured, and therefore that party or parties should be named as Favouree or Principal.
No reference to the Senior Master should be made in the bank guarantee.
Please direct any enquiries regarding security for costs to the Solicitor to the Senior Master on 1300 039 390.
Attachment:
Security for costs order (DOC 23KB)