Legal Insights

When an objection is objectionable

By Danielle Funston, Mathew Gashi

• 15 December 2022 • 1 min read
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In a decision handed down by Brown J on 20 May 2022 in Michaela Manicaros v Commercial Images (Aust) Pty Ltd [2022] QSC 83, the Queensland Supreme Court provided useful guidance on when a liquidator may recover their legal costs of a remuneration application from a creditor objecting to the application (Objector).

Her Honour indicated that generally, Courts should be hesitant to make costs orders against Objectors, as this might discourage them from legitimately raising concerns in remuneration applications. However, her Honour recognised that costs orders against Objectors could be made in exceptional circumstances and that such orders can be on a standard or indemnity basis.

The Court found that exceptional circumstances existed in this case for the Objector to pay the liquidator’s costs on a standard basis. This was because of the following:

  1. The Objector conducted himself as an adversary rather than as a mere objector in the application. This was because the Objector made unsubstantiated claims against the liquidator with no evidence filed to justify them.
  2. The Objector withdrew their opposition to the remuneration application well after the matter had been set down for hearing.

However, as the Objector’s conduct did not amount to serious and unjustifiable trouble and harassment and there was found to not have a predominant motivation which was for an ulterior purpose, the liquidators’ costs were not ordered to be paid on an indemnity basis.

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