Ninan v St George Bank [2014] FCA 334

The borrowers sought to sue the lender for millions of dollars for allegedly colluding in the manipulation of land prices and to prevent the bank enforcing its security.

The borrowers were citizens of Singapore living in Dubai and the Statement of Claim was drafted without legal assistance. The lender applied for an order that the borrowers provide security for costs which the judge granted commenting:

There are two reasons for making orders that the borrowers pay security for costs even though they are natural persons (not a company) before being allowed to pursue their claim:

  1. They are not ordinarily resident in Australia. That is one of the matters which has been recognised as justifying a departure from the normal rule.

  2. The statement of claim contains extensive scandalous and defences to be drawn. The borrowers have declined to address the deficiencies in their pleadings. This means the Court cannot proceed on the basis of the general rule that, where a claim is prima facie regular on its face and discloses a cause of action, it is appropriate (in the absence of evidence to the contrary) to proceed on the basis that the claim is bona fide and has reasonable prospects of success. I do not doubt the genuineness of the borrower’s personal belief that they have genuine grievances, but that is not the relevant test to be applied.

The court dismissed the proceedings as an abuse of process.

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