Australia, Sept. 6 -- New South Wales Land and Environment Court issued text of the following judgement on Aug. 6:

1. In two proceedings heard together in February 2025, the Plaintiff, Financialstrategy.com.au Pty Ltd ("FPL") brought claims of breach of contract and oppression in relation to the affairs of Bailey Roberts Group Pty Ltd (in liq) ("BRG"). The two proceedings address successive time periods. The earlier proceedings ("2021 Proceedings") were brought by FPL with leave against BRG, which is in liquidation; Bailey Financial Management Ltd; LAT Wealth Holdings Pty Ltd; Bailey Wealth Management Pty Ltd; Fumar Pty Ltd ("Fumar") (which has since been deregistered); and Sustain Holdings Pty Ltd. I will refer to those parties (other than Fumar) as the "2021 Defendants". Claims brought against two individuals, Mr Bailey and Mr Thomas, in the 2021 Proceedings were previously dismissed, but further claims were brought against them in the later proceedings ("2023 Proceedings").

2. By my judgment delivered on 20 March 2025 (Re Bailey Roberts Group Pty Ltd (in liq) [2025] NSWSC 227) ("Primary Judgment"), I dismissed both proceedings and indicated that I would hear the parties as to costs. I then determined the question of the costs of the proceedings by my further judgment delivered on 28 July 2025 (Re Bailey Roberts Group Pty Ltd (in liq) [2025] NSWSC 831) ("Costs Judgment") and directed the parties to bring in Short Minutes of Order to give effect to the judgment. The parties did not reach agreement as to the form of the orders and I now determine the orders that should be made in each of the 2021 Proceedings and the 2023 Proceedings.

The 2021 Proceedings

3. The 2021 Defendants submitted proposed orders in these proceedings. By email dated 4 August 2025, Mr Roberts' solicitors advised that FPM had filed a notice of appeal in respect of my findings in the Primary Judgment regarding the quantification of loss and damage, and submitted that, if successful, that would have flow-on consequence on the conclusion reached in my Costs Judgment. The solicitors acknowledged that FPM had not brought an appeal in respect of the orders dismissing the 2023 Proceedings, but contended that my finding as to costs in those proceedings partly rested on conclusions reached as to the 2021 Proceedings, which in turn underpinned FPM's claims made in the 2023 Proceedings.

4. Mr Roberts' solicitors requested that I defer making costs orders until the outcome of FPM's appeal in the 2021 Proceedings is known and submitted that:

"There are two advantages to doing so. The first is that it will obviate the need for an application for a stay. The second is it will, in the event the appeal is successful, permit the basis of the indemnity costs order in the 2023 [P]roceedings to be revisited (whereas otherwise, [FPM] would need to seek leave to appeal in respect of the indemnity costs order in the 2023 [P]roceedings)."

5. Mr Zahra, with whom Mr Turnbull appears for the 2021 Defendants, responds that the Court should not defer entering costs orders until after the determination of the appeal from the 2021 Proceedings, because, relevantly, the Court should determine all of the issues before it at first instance, including costs, and the impact of any appeal on costs in the 2021 Proceedings is a matter for the Court of Appeal. I accept that submission.

6. I do not propose to defer making costs orders to give effect to my Costs Judgment. First, those orders are necessary to complete the proceedings at first instance and, to the extent they are affected by any decision of the Court of Appeal, that Court may then vary them or remit the matter to first instance if it considers it appropriate to do so. Second, it would not be appropriate to defer making costs orders at first instance, into the indeterminate future, where that has the substantive effect of a stay of those orders, where FPM has not sought to establish, or established, a basis for such a stay.

7. Turning now to the prosed orders, order 1 proposed by the 2021 Defendants in the 2021 Proceedings gives effect to the conclusion which I reached in paragraph [36] of my Costs Judgment. Proposed order 2 provides for the costs of a defendant in the proceedings, Fumar Pty Ltd, which has since been deregistered. I will not make that order since that Defendant cannot seek that order where it is deregistered and an order cannot be made in its favour where it has no legal existence.

8. The 2021 Defendants also submit they should have their costs of the costs application, where they succeeded in obtaining an order for indemnity costs for the substantial part of the proceedings, although they failed in obtaining a third party costs order against Mrs Roberts. They submit that more of the time of the costs application was devoted to the question of indemnity costs, although it does not follow that that was the position as to the work done in preparation for the application, and it is apparent that significant investigations were undertaken as to issues concerning Mrs Roberts' role in funding the proceedings. On balance, it seems to me that the parties achieved a mixed result in the costs application in the 2021 Proceedings and I will make no order as to the costs application as between FSG and the 2021 Defendants.

*Rest of the document can be viewed at: (https://www.caselaw.nsw.gov.au/decision/1987e1d860c23a34a54ce40e)

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