TRACKEM PTY LTD (ACN 168 532 269) -v- REVENUE PARTNERS (A PARTNERSHIP) [2026] WASC 262

[2026] WASC 262 Page 1 JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA IN CIVIL CITATION : TRACKEM PTY LTD (ACN 168 532 269) -v- REVENUE PARTNERS (A PARTNERSHIP) [No 2] [2026] WASC 262 CORAM : GETHING J HEARD : 23 JUNE 2026 DELIVERED : 29 JUNE 2026 FILE NO/S : CIV 2426 of 2019 BETWEEN : TRACKEM PTY LTD (ACN 168 532 269) Plaintiff (First Defendant by Counterclaim) TRACKEM HOLDINGS PTY LTD (ACN 621 879 150) Second Defendant by Counterclaim KASHIF SALEEM Third Defendant by Counterclaim AND REVENUE PARTNERS (A PARTNERSHIP) First Defendant REVENUE PARTNERS PTY LTD (ACN 622 084 673) Second Defendant (First Plaintiff by Counterclaim) REVENUE PARTNERS CONSULTING PTY LTD (ACN 625 055 941) Third Defendant (Second Plaintiff by Counterclaim) STEPHEN PATRICK McNALLY Fourth Defendant (Third Plaintiff by Counterclaim) -- 1 of 30 -- [2026] WASC 262 Page 2 KEYT JOHN ATKINSON Fifth Defendant (Fourth Plaintiff by Counterclaim) Catchwords: Practice and procedure - Costs - Security for costs - Rules of the Supreme Court 1971 (WA) O 25 - Corporations Act 2001 (Cth) s 1335 - Principles where application is brought by a defendant to a counterclaim - Relevance of the proportionality of the costs of the procedures being adopted to the financial position of each party - Security for disbursements for expert evidence awarded - Turns on own facts Legislation: Corporations Act 2001 (Cth) s 1335 Rules of the Supreme Court 1971 (WA) O 25 Result: Defendants' application for security for costs against the plaintiffs dismissed Plaintiffs by counterclaim ordered to provide security for the disbursements of the defendants by counterclaim Category: B Representation: Counsel: Plaintiff (First Defendant by Counterclaim) : Mr M L Bennett Second Defendant by Counterclaim : Mr M L Bennett Third Defendant by Counterclaim : Mr T J Porter First Defendant : Ms K M McNally Second Defendant (First Plaintiff by Counterclaim) : Ms K M McNally Third Defendant (Second Plaintiff by Counterclaim) : Ms K M McNally -- 2 of 30 -- [2026] WASC 262 Page 3 Fourth Defendant (Third Plaintiff by Counterclaim) : Ms K M McNally Fifth Defendant (Fourth Plaintiff by Counterclaim) : Ms K M McNally Solicitors: Plaintiff (First Defendant by Counterclaim) : Bennett Second Defendant by Counterclaim : Bennett Third Defendant by Counterclaim : Barry Nilsson Lawyers First Defendant : McNally & Co Second Defendant (First Plaintiff by Counterclaim) : McNally & Co Third Defendant (Second Plaintiff by Counterclaim) : McNally & Co Fourth Defendant (Third Plaintiff by Counterclaim) : McNally & Co Fifth Defendant (Fourth Plaintiff by Counterclaim) : McNally & Co Case(s) referred to in decision(s): All Roofs Pty Ltd v Southgate Corporation Pty Ltd [2014] WASC 155 Attorney-General of Botswana v Aussie Diamond Products Pty Ltd [2009] WASC 299 Bell Wholesale Co Pty Ltd v Gates Export Corp (1984) 2 FCR 1 Bevwizz Group Pty Ltd v Transport Solutions Pty Ltd [2008] NSWSC 1399 Bhatia v Gill [2022] WASC 34 Braziron Corporate Services Pty Ltd v Road Rail and Mine Products Pty Ltd [2022] WASC 73 Bryan E Fencott & Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 Buckley v Bennell Design & Construction Pty Ltd (1974) 1 ACLR 301 Construction Industries Australia Ltd (in liq) v WFI Insurance Ltd [2016] WASC 404 Crosswest Corporation Pty Ltd v Allstrike Enterprises Pty Ltd [2014] WASC 27 Donald Campbell-Smith as executor of Martin Banning v Graeme Trevor Lean (in his capacity as Receiver) [2017] WASCA 89 FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd [2000] WASCA 69 Frigger v Kitay in his capacity as liquidator of Computer Accounting & Tax Pty Ltd (In Liq) [No 9] [2016] WASC 92 G & R Rossen Pty Ltd v Buchanan [2019] WASC 373 Gartner v Ernst & Young (No 3) [2003] FCA 1437 Gentry Bros Pty Ltd v Wilson Brown & Associates Pty Ltd (1992) 8 ACSR 405 George 218 Pty Ltd v Bank of Queensland Ltd [2016] WASCA 56 Idoport Pty Ltd v National Australia Bank Ltd [2001] NSWSC 744 -- 3 of 30 -- [2026] WASC 262 Page 4 Knights Capital Group Ltd v Bajada & Associates Pty Ltd [No 2] [2017] WASC 245 Lanai Unit Holdings Pty Ltd v Mallesons Stephen Jacques [2016] QSC 2 Livingspring Pty Ltd v Kliger Partners (2008) 20 VR 377; (2008) 66 ACSR 455 LPH Developments Pty Ltd v Jamieson Moore Pty Ltd [2015] WASC 416 Modern Holdings Pty Ltd v Centre Management Ltd [2022] WASC 19 Moran v Schwartz Publishing Pty Ltd [No 2] [2015] WASC 35 Patrick Jebb as trustee for the Trafalgar West Investment Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121 Phoenix Eagle Company Pty Ltd v Tom McArthur Pty Ltd [No 2] [2019] WASC 378 Pravenkav Group Pty Ltd v Diploma Construction (WA) Pty Ltd [No 2] [2014] WASCA 106 Reynolds v Sharaz [2023] WASC 327 Spence Financial Group Pty Ltd v GE Commercial Corporation (Australia) Pty Ltd [2007] WASC 15 Sugarloaf Hill Nominees Pty Ltd as Trustee for the Richard and Anna Trust v Rewards Projects Ltd [2011] WASC 19 Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 Trackem Pty Ltd v Revenue Partners [2021] WASC 245 Unified Pty Ltd v The Cancer Council Western Australia Inc [No 3] [2011] WASC 161 Vantage Holdings Group Pty Ltd v Donnelly [No 4] [2019] WASC 398 Vicon Services Pty Ltd v BHP Billiton Worsley Alumina Pty Ltd [2012] WASC 109 Vynben Pty Ltd v PA Audit Pty Ltd [2019] WASC 219 Westonia Earthmoving Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2013] WASC 57 Yici Pty Ltd v Sun Wah Marine Products (HK) Co Ltd [No 2] [2010] WASC 27 -- 4 of 30 -- [2026] WASC 262 GETHING J Page 5 GETHING J: Introduction 1 This action was commenced by writ filed in the District Court on 16 November 2018 (Action). On 17 July 2019, the Action was remitted to the Supreme Court by consent. Multiple amendments to the defence and counterclaim followed. 2 The most recent version of the statement of claim was filed on 31 January 2025 (Claim). The first plaintiff is Trackem Pty Ltd (Trackem) and the second plaintiff Trackem Holdings Pty Ltd (Trackem Holdings) (together Trackem Parties). The defendants are Revenue Partners (a partnership) (first defendant), Revenue Partners Pty Ltd (RP) (second defendant), Revenue Partners Consulting Pty Ltd (RPC) (third defendant), Stephen McNally (fourth defendant) and Keyt Atkinson (fifth defendant). Mr McNally and Mr Atkinson are directors of RP and RPC. I will refer to the defendants collectively as the Revenue Parties. 3 The most recent version of the Defence and Counterclaim was filed on 6 June 2025. Trackem is the first defendant by counterclaim and Trackem Holdings the second defendant by counterclaim. There is a third defendant to the counterclaim, Kashif Saleem. Mr Saleem is a director of Trackem and Trackem Holdings. 4 The dispute dates back to 2017. Trackem is a software provider for businesses, primarily in the resources sector. In 2017 there were discussions between representatives of the Revenue Parties and the Trackem Parties about the former providing services to the latter. In broad terms, the services to be provided were for the purpose of growing the business of the Trackem Parties. The provision of those services began from the end of August 2017. At some point in the engagement the parties appear to entered into a Memorandum of Understanding (MOU). 5 Over the period from August 2017 to July 2018 the Revenue Parties issued invoices totalling $498,643.76. The Trackem Parties paid these invoices in full. In the Claim, the Trackem Parties seek repayment or restitution of these amounts. The Trackem Parties' engagement of the Revenue Parties was terminated by mutual consent in August or September 2018. After termination, the Revenue Parties issued invoices totalling $177,375. The Trackem Parties have not paid -- 5 of 30 -- [2026] WASC 262 GETHING J Page 6 these invoices, and deny that they have any obligation to do so. In essence, the Trackem Parties say that they did not receive what was promised by the Revenue Parties. They then bring a claim to the effect that the Revenue Parties, including Mr McNally and Mr Atkinson personally, made representations which amounted to misleading and deceptive conduct. It claims loss and damages as a result, which are yet to be fully particularised. 6 In the Defence and Counterclaim, the first 67 pages are the Defence and the remaining 46 are the Counterclaim. The Defence puts in issue the extensive pre-contractual engagement between the parties which the Trackem Parties set out in the Claim as being the foundation for their claims for relief. The Counterclaim adds claims in relation to: (a) a capital raising which the Revenue Parties agreed to seek to raise, which, if successful, would have earnt it the right to an equity stake in Trackem Holdings; (b) a claim for damages for the loss of opportunity for Revenue Parties to benefit from other work; (c) a claim for damages for breach of the MOU; and (d) a claim for quantum meruit in the event that it has no contractual entitlement to the fees paid and invoiced. In their schedule of damages filed 3 October 2025, the Revenue Parties claim damages in the order of $9.6 million to $13.6 million (Counterclaim Particulars). 7 By letter to my Associate dated 10 April 2026, the Trackem Parties applied for orders that RP and RPC give security for the Trackem Parties' costs of defending the Counterclaim in the sum of $480,292 to be given in tranches (Trackem Application). 8 By application filed 10 April 2026, Mr Saleem applied for security for costs against the plaintiffs by counterclaim (Saleem Application). 9 By minute of proposed orders filed on 10 April 2026, the Defendants applied for security for costs against the Plaintiffs (Revenue Application). 10 The Trackem Parties rely on: -- 6 of 30 -- [2026] WASC 262 GETHING J Page 7 (a) an affidavit of Eliza Fletcher, a legal practitioner employed by Trackem Parties' lawyers, filed 10 April 2026 (First Fletcher Affidavit); (b) a second affidavit of Ms Fletcher filed 29 April 2026 (Second Fletcher Affidavit); and (c) submissions filed 20 May 2026. 11 Mr Saleem relies on: (a) an affidavit of Belinda Randall, a legal practitioner employed by Mr Saleem's lawyers, filed 10 April 2026 (Randall Affidavit); (b) the First Fletcher Affidavit; (c) the Second Fletcher Affidavit; and (d) submissions filed 13 May 2026. 12 The Defendants rely on: (a) an affidavit of Kathleen McNally, the principal of the Revenue Parties lawyers, filed 10 April 2026 (McNally Affidavit); and (b) submissions filed 20 May 2026. 13 In each case, security for costs is sought pursuant to both Corporations Act 2001 (Cth) (CA) s 1335 and Rules of the Supreme Court 1971 (WA) (RSC) O 25. 14 For the reasons which follow: (a) RP and RPC must provide security for the disbursements to be incurred by the Trackem Parties and Mr Saleem in relation to the provision of expert evidence on the issues raised in the counterclaim in an amount to be fixed by, and a form acceptable to, the Court; (b) the Counterclaim will be stayed until that occurs, and ultimately dismissed if it remains stayed as at 31 December 2026; and (c) the Revenue Application must be dismissed. -- 7 of 30 -- [2026] WASC 262 GETHING J Page 8 Principles - CA s 1335 15 CA s 1335(1) provides: Where a corporation is plaintiff in any action or other legal proceeding, the court having jurisdiction in the matter may, if it appears by credible testimony that there is reason to believe that the corporation will be unable to pay the costs of the defendant if successful in his, her or its defence, require sufficient security to be given for those costs and stay all proceedings until the security is given. 16 The reference to a 'plaintiff' includes a cross-claimant, or in the forms adopted in this court, a plaintiff by counterclaim, who files a counterclaim in addition to a defence.1 17 The power in CA s 1335(1) contains a threshold test or jurisdictional requirement and a discretion. The threshold requirement is that 'it appears by credible testimony that there is reason to believe that the corporation will be unable to pay the costs of the defendant if successful in his, her or its defence'. 18 There is no evidentiary burden to be undertaken or discharged by a party seeking the security order. Rather, what is required is an evaluation of the evidence led by the applicant to see whether that leads to a reason to believe that the corporation will be unable to pay the costs of the applicant if successful in its defence.2 19 The principles by which this evaluation is to be carried out are well settled, and may be summarised as follows:3 1 Bevwizz Group Pty Ltd v Transport Solutions Pty Ltd [2008] NSWSC 1399 at [18] (Brereton J) (Bevwizz). See for example: Knights Capital Group Ltd v Bajada & Associates Pty Ltd [No 2] [2017] WASC 245 (Knights); LPH Developments Pty Ltd v Jamieson Moore Pty Ltd [2015] WASC 416. 2 FFE Minerals Australia Pty Ltd v Mining Australia Pty Ltd [2000] WASCA 69 [24] (FFE); Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 [69] (Kenneth Martin J with whom Pullin JA agreed) (Swansdale); Sugarloaf Hill Nominees Pty Ltd as Trustee for the Richard and Anna Trust v Rewards Projects Ltd [2011] WASC 19 [34] (Corboy J) (Sugarloaf); Vantage Holdings Group Pty Ltd v Donnelly [No 4] [2019] WASC 398 [206] (Smith J); Vynben Pty Ltd v PA Audit Pty Ltd [2019] WASC 219 [27] - [28] (Smith J); G & R Rossen Pty Ltd v Buchanan [2019] WASC 373 [59] (Kenneth Martin J); Braziron Corporate Services Pty Ltd v Road Rail and Mine Products Pty Ltd [2022] WASC 73 (Strk J) [33] (Braziron); Modern Holdings Pty Ltd v Centre Management Ltd [2022] WASC 19 [14] (Strk J) (Modern Holdings). 3 Donald Campbell-Smith as executor of Martin Banning v Graeme Trevor Lean (in his capacity as Receiver) [2017] WASCA 89 [63] (Murphy JA); George 218 Pty Ltd v Bank of Queensland Ltd [2016] WASCA 56 [40] - [48] (Murphy JA) (George 218); Pravenkav Group Pty Ltd v Diploma Construction (WA) Pty Ltd [No 2] [2014] WASCA 106 [18] (Murphy JA) (Pravenkav); FFE [22] - [24]; Vicon Services Pty Ltd v BHP Billiton Worsley Alumina Pty Ltd [2012] WASC 109 [17] (Le Miere J); Sugarloaf [35]; Livingspring Pty Ltd v Kliger Partners (2008) 20 VR 377; (2008) 66 ACSR 455 [15] - [16] (Maxwell P & Buchanan JA) (Livingspring). -- 8 of 30 -- [2026] WASC 262 GETHING J Page 9 (a) the court will adopt a practical, common-sense approach to the examination of the corporation's financial affairs; (b) it is necessary to make an assessment of the risk that the corporation will be unable to pay, an assessment that will necessarily be imprecise; (c) a 'reason to believe' is a low threshold test; (d) the requirement that there be 'credible testimony' is an obvious safeguard to ensure that the application is not founded purely upon speculation; (e) in ascertaining whether there is 'credible testimony', the court does no more than judge the quality of the evidence to see if it objectively gives rise to 'a reason to believe'; (f) the court will need to fix the time at which the corporation's inability, or apprehended inability, is to be assessed, which will generally require an opinion to be formed as to the date on which judgment is likely to be given; (g) the court will need to identify the range of assets to which recourse might be had for the purpose of enforcing an adverse costs order; and (h) generally, the relevant assets will be those that might be immediately realised and those which could be realised in sufficient time to enable the corporation to comply with a costs order in the usual terms. 20 Once the discretion in enlivened, it is unfettered by the terms of CA s 1335(1), though it must be exercised judicially by reference to established principle and considering all the circumstances of the case.4 The circumstances in which the discretion should be exercised cannot be stated exhaustively, and all of the circumstances of the case should be examined.5 4 Swansdale [67], [71]; FFE [21]; Phoenix Eagle Company Pty Ltd v Tom McArthur Pty Ltd [No 2] [2019] WASC 378 [14] (Allanson J) (Phoenix); Westonia Earthmoving Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2013] WASC 57 [5] - [6] (Edelman J) (Westonia); Braziron [35]; Modern Holdings [25]. 5 Yici Pty Ltd v Sun Wah Marine Products (HK) Co Ltd [No 2] [2010] WASC 27 [3] - [4] (Martin CJ); All Roofs Pty Ltd v Southgate Corporation Pty Ltd [2014] WASC 155 [33] (All Roofs) (Acting Master Gething); Braziron [37]. -- 9 of 30 -- [2026] WASC 262 GETHING J Page 10 21 Once the discretion is enlivened, it is for the applicant to persuade the court that the discretion should be exercised in its favour. However, each party will be required to advance evidence on the particular factual matters it wishes to assert as part of its case.6 The factors include (referring to the applicant and respondent to the application for security for costs):7 (a) the strength and bona fides of the respondent's case; (b) the likelihood of the respondent being unable to pay the applicant's costs; (c) whether the respondent's impecuniosity was caused by the applicant's conduct which is the subject of the claim; (d) whether the application for security is oppressive; (e) whether the award of security would deny an impecunious party a right to litigate; (f) whether there are persons standing behind the respondent who are likely to benefit from the litigation; (g) whether the persons standing behind the respondent have offered any security or personal undertaking to be liable for the costs, and if so, the form of such an undertaking; (h) whether the respondent is in substance a 'plaintiff' or the proceedings were defensive in the sense of directly resisting proceedings already brought or seeking to halt the applicant's ('defendant's') self-help procedures; (i) whether the application for security has been brought promptly; (j) whether the applicant has any rights which it can exercise against assets of the respondent to satisfy an order for costs in its favour; and (k) any factors relating to the public interest. 22 Of particular relevance to the present case is the approach taken by the Court where the application is made by the plaintiff to an action 6 Sugarloaf [34]; Livingspring [20]; All Roofs [34]; Braziron [38]; Modern Holdings [19]. 7 See generally: Westonia [6]; Swansdale [71] - [74]. -- 10 of 30 -- [2026] WASC 262 GETHING J Page 11 who is also the defendant to of a cross-claim or a counterclaim. The general position is summarised by Pritchard J in Knights:8 A factor which will militate against an order for security for costs is if the counterclaim is essentially a defensive measure, or covers substantially the same factual ground as will be covered in the plaintiff's claim…One example of a case of that kind is where a cross-claim arises out of the same facts as the original claim… Similarly, if substantially the same issues are likely to arise on the counterclaim as in the plaintiff's claim, the Court will be slow to order security for costs… Principles - RSC O 25 23 RSC O 25 relevantly provides: Order 25 - Security for costs 1. Factors that are not grounds for ordering security for costs The Court may order security for costs to be given by a plaintiff, but no order shall be made merely on account of the poverty of the plaintiff or the likely inability of the plaintiff to pay any costs which may be awarded against him. 2. Grounds for ordering security for costs Without limiting the generality of rule 1 the Court may order security for costs to be furnished where the plaintiff — (a) is ordinarily resident out of the jurisdiction, notwithstanding that he may be temporarily within the jurisdiction; (b) is about to depart from the jurisdiction; (c) enjoys within the jurisdiction some privilege which renders him immune, wholly or partially, from the normal processes of execution; (d) is an undischarged bankrupt or a person who has suspended, or given notice of suspension of, his debts; (e) is a company in liquidation or under official management, or a company in respect of which a receiver of its property has been appointed; (f) is a relator suing for the enforcement or declaration of some public right or to have some public trust carried out or some charitable scheme settled; 8 Knights [19] (references omitted). -- 11 of 30 -- [2026] WASC 262 GETHING J Page 12 (g) is in default in respect of any costs ordered to be paid by him in any proceedings previously brought by him against the same defendant or another defendant for substantially the same cause of action or in relation to substantially the same subject matter; (h) is a person who has in the past vexatiously brought litigation against the same defendant or against any other defendant; (i) is suing the sheriff in respect of anything done or omitted to be done by the sheriff or his officers in the execution of any judgment of the Court. 3. Court has discretion The granting of security shall be in the discretion of the Court, and in determining whether an order should be made the Court shall take into consideration — (a) the prima facie merits of the claim; (b) what property within the jurisdiction may be available to satisfy any order for costs against the plaintiff; (c) whether the normal processes of the Court would be available within the jurisdiction for enforcement of any order for costs made against the plaintiff. 4. Term used: plaintiff In this Order the term plaintiff shall include a defendant counterclaiming in respect of a claim not arising out of the claim made against him. 24 The principles specifically applicable to the exercise of the power in RSC O 25 r 1 are again well established and may be summarised as follows:9 (a) the power in RSC O 25 r 1 to order security for costs is discretionary; (b) the court's discretion to order security for costs is broad and depends upon all the circumstances of the case; 9 See generally: George 218 [43] - [44]; Reynolds v Sharaz [2023] WASC 327 [15] - [20] (Solomon J); Bhatia v Gill [2022] WASC 34 [5] (Kenneth Martin J); Patrick Jebb as trustee for the Trafalgar West Investment Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121 [214] (Vaughan J) (Patrick Jebb); Moran v Schwartz Publishing Pty Ltd [No 2] [2015] WASC 35 [30] - [37] (Kenneth Martin J); Crosswest Corporation Pty Ltd v Allstrike Enterprises Pty Ltd [2014] WASC 27 [10] - [16] (Beech J). -- 12 of 30 -- [2026] WASC 262 GETHING J Page 13 (c) under O 25 r 1 (unlike under CA s 1335(1)) the likely inability of a respondent to the application to pay any costs which may be awarded against them it is not, in itself and standing alone, a sufficient ground to make an order for security; (d) however, the point in (c) does not make such an inability irrelevant to the exercise of discretion under O 25 r 1, rather, any such likely inability is among the factors relevant to the exercise of discretion; (e) any exercise by the court of its power to order security is always an order made to serve the interests of justice; and (f) the power is to be exercised so as to best ensure the attainment of the objects referred to in RSC O 1 r 4B, which includes the objects of promoting the just determination of litigation and ensuing that the costs of procedures are proportionate to the parties' financial position. 25 RSC O 25 r 3 sets out three factors that the court must take into consideration. These factors are not exhaustive.10 In addition, the factors which may be relevant to the exercise of the discretion include the factors which I have set out at [21] relating to CA s 1335(1).11 26 As to the exercise of the discretion, in Patrick Jebb, Vaughan J observed:12 The purpose of an order for security for costs is to protect the defendant against the risk of not being reimbursed for its costs by way of a costs order should the defendant be successful. A countervailing consideration is the interest that a plaintiff has in protecting or vindicating its rights through the conduct of litigation in the court. The factors which have been developed to aid in the exercise of the discretion inform the court in striking a balance between those competing interests. Evidence and submissions of the Trackem Parties 27 Counsel for the Trackem Parties identified the issue to be determined in the Trackem Application as whether security should be ordered (and the Counterclaim be stayed pending the provision of security by the Revenue Parties), in view of the Revenue Parties' likely 10 Moran [30]. 11 Patrick Jebb [217]; Construction Industries Australia Ltd (in liq) v WFI Insurance Ltd [2016] WASC 404 [29] (Pritchard J); Crosswest [14]. 12 Patrick Jebb [218]. -- 13 of 30 -- [2026] WASC 262 GETHING J Page 14 inability to meet an adverse costs order given their apparent financial position. 28 The Trackem Parties submit there is reason to believe that the Revenue Parties will be unable to pay an adverse costs order on the grounds that: (a) as at 10 April 2026, the Revenue Parties have no real property registered in their names in Western Australia;13 (b) RP has two shareholders and paid-up share capital of $2;14 (c) RPC has two shareholders and paid-up share capital of $100.15 (d) there is no publicly available information evidencing any major contracts or clients that are engaging the Revenue Parties services, as one may expect to see from a business of its kind; (e) the only assets known to be held by the Revenue Parties are 500,000 shares in Trackem Holdings; (f) the Revenue Parties presumably continue to incur legal fees in relation to these proceedings, though there is no evidence that invoices for recent work have been paid;16 and (g) despite request, Revenue Parties have not provided any evidence before the Court to indicate their capacity to meet a costs order, from which the Court is invited to infer that such information would not have assisted the Revenue Parties. 29 Counsel for the Trackem Parties acknowledges that the proceedings have been on foot for a significant period time and that a counterclaim was brought earlier in the proceedings. Nevertheless, the submission is made that the Trackem Application was brought promptly and only seeks prospective security for costs incurred in defending the Counterclaim. 30 Counsel for the Trackem Parties placed particular emphasis on the Counterclaim Particulars filed on 3 October 2025. The Counterclaim Particulars cite several areas requiring expert evidence and revealed the scope of the quantum meruit claim. 13 First Fletcher Affidavit, EMF-3, EMF-4, pages 17 - 18. 14 First Fletcher Affidavit, EMF-1, pages 9 - 12 15 First Fletcher Affidavit, EMF-2, pages 13 - 16. 16 First Fletcher Affidavit, EMF-17, pages 55 - 62. -- 14 of 30 -- [2026] WASC 262 GETHING J Page 15 31 On 20 October 2025, the Court made orders for the Revenue Parties to give informal discovery of their costs agreement and legal invoices (this being relevant to an aspect of the Counterclaim Particulars). The Court also directed the parties to attend a mediation which was listed for 11 February 2026. On 16 January 2026, the Revenue Parties provided informal discovery of documents recording costs agreements and invoices rendered to them. A total of 342 pages of invoices and costs agreements were provided to and reviewed by the solicitors for the Trackem Parties. Upon their review of the invoices, it became apparent that the Revenue Parties had not been invoiced for work performed by their solicitors for the 11 months prior to the orders for informal discovery being made.17 The Action did not settle at the 11 February 2026 mediation. 32 The Trackem Parties initiated conferral regarding security for costs eight days after the failed mediation, on 19 February 2026.18 At a directions hearing on 27 February 2026, the Court made orders for any application for security for costs to be made by 27 March 2026. By consent orders made on 27 March 2026, the time was extended to 9 April 2026. From 19 February 2026 to 10 April 2026 the parties engaged in conferral in respect of the security for costs applications. The Trackem Parties filed the Trackem Application on 10 April 2026. 33 Counsel submits that the Trackem Application was brought promptly after new information was revealed that raised concern regarding the Revenue Parties' financial position and ability to pay an adverse costs order and an already scheduled mediation. 34 In relation to the merits, counsel described the Counterclaim as being convoluted and devoid of proper particulars. More specifically: (a) the Revenue Parties allege that Trackem falsely represented that they were eligible for research and development tax offsets - there are serious questions as to what loss or damages flows from this claim; (b) they allege that the quantum of the Counterclaim is not properly particularised and that it purports to rely on expert evidence that has not yet materialised; and 17 First Fletcher Affidavit, EMF-17, pages 55 - 62. 18 First Fletcher Affidavit, EMF-12, pages 39 - 41. -- 15 of 30 -- [2026] WASC 262 GETHING J Page 16 (c) the Revenue Parties claim loss of opportunity regarding businesses that no longer exist or have been placed under administration, and only a very limited number of documents have been discovered in relation to these claims. These issues are said to raise serious doubts over both the prima facie merits and the bona fides of those parts of the Counterclaim. At best, it is submitted, the Counterclaim is tenuous and, in any event, would be very difficult and expensive to establish. This should weigh in favour of an order for security for costs. 35 As to the other discretionary considerations, the Trackem Parties submit: (a) the Trackem Parties seek security for costs in respect of the Counterclaim only and have carefully drawn their application so as not to claim security for the Trackem Parties' primary claim against the Revenue Parties; (b) the Trackem Application requests security be provided in tranches to reduce the burden of coming up with security in one lump sum; (c) in the absence of any evidence filed by the Revenue Parties, the Trackem Application cannot be said to be oppressive to them; (d) the Revenue Parties' current financial position is not, and is not alleged to be, the result of the Trackem Parties' alleged conduct; (e) the Revenue Parties have failed to file any evidence in response to the Trackem Application which addresses their financial position or capacity to borrow funds and without such evidence, no conclusion can be drawn that an order for security would stifle the Counterclaim; and (f) no person standing behind the Revenue Parties has proffered an undertaking to be liable for their costs in the event they are unsuccessful in the Counterclaim. 36 As to the quantum of costs, Ms Fletcher has prepared a bill of costs by reference to the Legal Profession (Supreme and District Courts) (Contentious Business) Determination 2020. Where appropriate, the draft bill makes allowances for the fact that the Trackem Parties will incur costs in prosecuting their claim against -- 16 of 30 -- [2026] WASC 262 GETHING J Page 17 Revenue Parties. The bill itemises the costs through to the end of a 15 day trial to be $581,704, of which $426,920 is allocated to the Counterclaim.19 I observe that the applicable costs scale for future costs is the Legal Profession (Supreme and District Courts) (Contentious Business) Determination 2024 (2024 Determination) which, in the usual course, will likely be reviewed and replaced by a version commencing 1 July 2026. So the costs will be higher by mid-2028 when any bill would be required to be paid. Evidence and submissions of Mr Saleem 37 Counsel for Mr Saleem submits that the inability of the plaintiffs by counterclaim to meet a costs order is a threshold requirement under CA s 1335 and an important discretionary factor under RSC O 25. The inability of the plaintiffs by counterclaim to meet a costs order is said to be shown by the following facts: (a) the first to third plaintiffs by counterclaim own no real property;20 (b) the fourth plaintiff by counterclaim (Mr Atkinson) is the registered proprietor of a property, but it is subject to a mortgage and the extent of any equity in the property is unknown;21 (c) the first and second plaintiffs by counterclaim have paid up capital of $2 and $100 respectively;22 and (d) that despite a request to do so, the plaintiffs by counterclaim declined to provide any evidence of their financial position.23 38 The plaintiffs by counterclaim have not filed any evidence in opposition to Mr Saleem's application, so there is no evidence that an order for security will stultify the counterclaim proceedings. Nor is there any evidence that the plaintiffs by counterclaim have suffered any prejudice by reason of the delay between when the counterclaim was first filed (10 June 2019) and the date of the Saleem Application. In any event, only future costs have been claimed. 19 First Fletcher Affidavit, EMF-18. 20 First Fletcher Affidavit, [7], [8], [17]. 21 First Fletcher Affidavit, [13] - [15]. 22 First Fletcher Affidavit, [9] - [10]. 23 First Fletcher Affidavit, [18] - [19]. -- 17 of 30 -- [2026] WASC 262 GETHING J Page 18 39 Counsel for Mr Salem then submits while there are limits on the extent to which an assessment can be made of the substantive merits of the counterclaim, three points can be made: (a) the fact that a number of the allegations against Mr Saleem are based on words allegedly spoken by Mr Saleem almost 10 years ago means that those allegations will face the usual difficulty arising where a fact is sought to be proved by reference to oral testimony, rather than by reference to a contemporaneous documentary record; (b) the Revenue Parties allege reliance on a multitude of alleged representations, but those instances of alleged reliance are not (based on the particularisation of the claims) evidenced in contemporaneous documents; and (c) the claim concerning Trackem's entitlement to R&D tax offsets from the ATO24 has poor prospects of success as Trackem was in fact granted the R&D tax offsets and that assessment is no longer open to challenge,25 so the plaintiffs by counterclaim cannot have suffered any loss in respect of the R&D tax offsets claim. 40 Ms Randall has considered the pleaded allegations against Mr Saleem in the counterclaim and the work required to be done in respect of Mr Saleem's defence of the counterclaim.26 Based on her experience, and her review of the allegations against Mr Saleem, Ms Randall has prepared a draft bill of costs which details the work his lawyers will need to perform on behalf of Mr Saleem, up to and including the first day of trial. Ms Randall has calculated an estimate of the cost of that work using the amounts allowable under the 2024 Determination and the charge out rates applicable to his lawyers' retainer to act for Mr Saleem. Ms Randall's opinion is that, at the scale allowances, Mr Saleem's estimated legal costs up to and including the first day of trial are $93,251.27 41 I also note that on 24 March 2026, Mr Saleem filed a notice pursuant to RSC O 9A, notifying the Principal Registrar that AAI 24 Counterclaim [52] - [58]. 25 Citing the earlier decision in this Action of Trackem Pty Ltd v Revenue Partners [2021] WASC 245 [53], [85], [89] - [91], [108], [134] - [142] (Archer J). 26 Randall Affidavit, [8] - [18]. 27 Randall Affidavit, [25] - [33], BMR-5. -- 18 of 30 -- [2026] WASC 262 GETHING J Page 19 Limited trading as Vero Insurance was an interested non-party for the purposes of that rule. Evidence and submissions of the Revenue Parties 42 The essence of the evidence relied on by the Revenue Parties is that the financial position of the Trackem Parties has been deteriorating over the past few years. The groups' financial statements for FY 2025 showed a worsening position from FY 2024 with losses up from $90k to $140k and cash on hand going down from $538k to $358k.28 The point is made that the valuations of businesses like the Trackem Parties has in recent times been affected by the development of artificial intelligence.29 This information, it is submitted, explains why the Revenue Application was filed.30 Counsel invites the Court to have reason to believe from this information that there is credible testimony that the Trackem Parties will not be able to pay the costs of the Revenue Parties if successful in their defence. 43 Ms McNally has prepared a draft bill of costs to the effect that the trial of the Defence will be at least $315,476.31 She assumes a 10 day trial, with five days apportioned to the Counterclaim. So the amount referable to the Defence is in the order of $150k. This excludes the disbursements for expert evidence. 44 Counsel the makes the following submission and concession:32 5. The usual grounds for ordering security set out in Order 25r2 do not apply to any party. However, in relation to (g), there have been significant cost orders awarded against both Trackem and the defendants in this action that have been paid. It is evident from the court file that all parties would have incurred significant legal costs in relation to this action since 2018. Due to these legal costs, the defendants / plaintiffs by counterclaim will not be in a position to pay the amounts sought by Trackem and Mr Saleem and defend the claim and pursue the counterclaim. 6. If security for costs is awarded in favour of Trackem and/or Mr Saleem on the counterclaim, and the costs are not paid, the plaintiffs by counterclaim agree that order 2 should be made and the counterclaim stayed until payment. 28 McNally Affidavit, [7]. 29 McNally Affidavit, [7]. 30 Revenue Submissions, [18]. 31 McNally Affidavit, KMM-7. 32 Revenue Submissions, [5], [6]. -- 19 of 30 -- [2026] WASC 262 GETHING J Page 20 45 Counsel for the Revenue Parties confirmed in oral submissions that the Revenue Parties did not contest that the discretion to order security for costs against RP and RPC pursuant to CA s 1335(1) had been enlivened. 46 Rather, the focus of the submission was that the discretion should not be exercised to make an order for security for costs for two reasons: delay and the strong merits of the Counterclaim. 47 The position of the Revenue Parties is that the present application should be approached in the manner which I have set out at [22]. The counterclaim is essentially a defensive measure and arises out of the same facts as the claim. Accordingly, the Court should be slow to order security for costs. 48 Counsel goes on to say:33 One of the most significant amendments to the claim was the 2023 introduction, after Trackem's legal team trawled through ~30,000 documents…, of an excel worksheet marked draft (which Trackem refers to as the “Revenue Partners Budget”) which is said to contain the phase 1 plan financial metrics … The plaintiff's 2023 pivot from 'services' to 'results' came after queries directed to Trackem at the hearing on 17 January 2023 … in relation to the services claim, and followed by letters from McNally & Co dated 24 April 2023 … (and in particular from paragraph 48), 1 June 2023 … 6 July 2023 … and 21 July 2023 … and the identification by the Trackem legal team of the excel worksheet. The defendants described this in their [letter] of 1 June 2023 as Trackem attempting to launch a new case. 49 The submission is made that the majority of the time and cost to date, and relevantly going forward, have been and will be incurred as a result of the Trackem Parties. Nearly eight years into the Action, the Revenue Parties (and Court) are unaware as to what the alleged defaults are in relation to the other representations and how they are to be proved (or disproved) at trial, and - if there are no pleaded defaults - how damages can be assessed. Determination - Trackem Application 50 The relevant time frame at which to consider the issue of whether the threshold in CA s 1335(1) has been met is at judgment. At the rate at which all parties are preparing their cases, the Action is unlikely to 33 Revenue Submissions, [13] (references omitted). -- 20 of 30 -- [2026] WASC 262 GETHING J Page 21 go to trial in 2027. So I will proceed on the basis that judgment will be handed down around mid 2028. 51 The costs assessment by Ms Fletcher is reasonable, though skewed more towards Counterclaim costs than it should be. In my assessment, given the complex factual issues which will need to be dealt with concerning the interactions of the relevant witnesses in 2017, I assess that about half the time at trial will be spend on the Claim and Defence, and half on the Counterclaim. That still leaves an amount in the order of $290k ($581,704 x 0.5) 52 I am readily satisfied by credible testimony that there is reason to believe that RP and RPC will each be unable to pay the costs of the Trackem Parties in the amount of $290k if successful in their defence of the Counterclaim and assuming judgment is given in mid 2028. As mentioned, Counsel for the Revenue Parties did not argue the contrary. 53 The discretion in CA s 1335(1) is thus enlivened. 54 The fact which enlivened the jurisdiction in CA s 1335(1) is a substantial factor in favour of its exercise.34 It does not, however, establish an entitlement, or even a predisposition, in favour of ordering security for costs.35 55 I turn next to the merits and bona fides of the parties' claims. On an application for security for costs, the court will not generally investigate the likelihood or otherwise of either party being successful in the action. There may be exceptional cases where the merits are clear or where the claim cannot succeed in point of law or is not brought bona fide.36 With one caveat (which I discuss at [58]), the Action is not such a case. The issues which I have briefly summarised at [4] - [6] are issues which should properly be resolved at trial. None of the points highlighted by counsel for each of the parties change this view. There is no outstanding application by either the Trackem Parties or the Revenue Parties to strike out any pleading on the basis that it does not disclose a reasonable cause of action (though there are outstanding issues going to the provision of particulars). So I proceed on the basis that each accepts that the other's pleadings cannot be 34 Pravenkav [19]; Swansdale [80]; Braziron [35]; Modern Holdings [15]. 35 Unified Pty Ltd v The Cancer Council Western Australia Inc [No 3] [2011] WASC 161 [11] (Allanson J) (Unified); Frigger v Kitay in his capacity as liquidator of Computer Accounting & Tax Pty Ltd (In Liq) [No 9] [2016] WASC 92 (Allanson J) [9] - [10]; Braziron [31]; Modern Holdings [12]. 36 Swansdale [72]; Gartner v Ernst & Young (No 3) [2003] FCA 1437 [10] (Mansfield J); Gentry Bros Pty Ltd v Wilson Brown & Associates Pty Ltd (1992) 8 ACSR 405, 416 (Cooper J) (Gentry Bros); All Roofs [33]. -- 21 of 30 -- [2026] WASC 262 GETHING J Page 22 challenged on that basis. There are extensive factual issues which underpin the position of each party. All parties rely extensively on oral statements made nearly 10 years ago. So all parties will experience the forensic difficulties posed by this type of case. So the merits of the Counterclaim and the Claim are essentially neutral factors to the exercise of the discretion. 56 It is significant that the Trackem Application is made in relation to the Counterclaim and arises out of the same broad factual matrix as the Claim. I accept the position that if substantially the same issues are likely to arise on the Counterclaim as in the Claim (and Defence), the Court will be slow to order security for costs ([22]). It would be unjust for the Counterclaim to be stayed if security is not paid in circumstances where exactly the same issues will need to be litigated in the Claim. 57 However, in my assessment the Counterclaim goes beyond the scope of the Claim. Reading the Counterclaim and the Counterclaim Particulars together, the Counterclaim includes: (a) a claim in relation to a capital raising agreement said to have been entered into by the present parties in November 2017, and is said to give rise to a damages claim of just over $1M (for which there will need to be expert evidence as to the market value of shares in Trackem Holdings); (b) a claim for the loss of opportunity for RP and RPC to benefit from other work due to the misleading conduct of representatives of the Trackem Parties, which is said to give rise to damages of around $480k, which again has some equity valuation issues which will need to be the subject of expert evidence; (c) a claim for breach of the MOU, leading to the loss of an opportunity to have the success fee converted into equity, which is said to give rise of damages of around $1.3M, which has some equity valuation issues which will need to be the subject of expert evidence; (d) a claim for the difference between the amount paid for shares in Trackem Holdings and their market value, said to arise from the misleading conduct of the Trackem Parties, of less than $200k, but for which expert evidence will be required; and -- 22 of 30 -- [2026] WASC 262 GETHING J Page 23 (e) a further claim for loss of opportunities to the misleading conduct of representatives of the Trackem Parties, which is said to give rise of damages in excess of $1.8M, which will need to be the subject of expert evidence. 58 In the Counterclaim Particulars there is also however, the quantification of a claim in quantum meruit for services provided to Trackem up to 18 September 2018. This is pleaded in the Defence.37 The amount claimed is in between $4.7M and $8.7M. This is said to be the subject of expert evidence. So what is asserted is that the reasonable value of services which were invoiced for just under $700k (paid and invoiced fees) is an amount between $4.7M and $8.7M. I regard this assertion as being implausible and having minimal prospects of success. 59 The analysis in [57] and [58] leads me to conclude that the Counterclaim goes well beyond what is purely defensive of the Claim. This is not a case in which it would be unjust for the Counterclaim to be stayed if security is not paid in circumstances as exactly the same issues will need to be litigated in the Claim. 60 The next factor is delay. The existence of an unexplained delay in bringing the application is a factor against the grant of security for costs, at least in relation to future costs. The reason for this is explained by Moffitt P in Buckley v Bennell Design & Constructions Pty Ltd:38 The primary reason why the application should be brought promptly and pressed to determination promptly is that the company, which by assumption has financial problems, is entitled to know its position in relation to security at the outset, and before it embarks to any real extent on its litigation, and certainly before it is allowed to or commits substantial sums of money towards litigating its claim. 61 However, I agree with the observation by Jackson J in Lanai Unit Holdings Pty Ltd v Mallesons Stephen Jacques about the passage just quoted that:39 To the extent that it says that the plaintiff is 'entitled' to know its position, in my view, the statement is too strong. The powers under … s 1335 are discretionary and are not to be fettered by statements that a party is 'entitled' to know its position. 37 Defence, [37.2]. 38 Buckley v Bennell Design & Construction Pty Ltd (1974) 1 ACLR 301, 309 (Moffitt P) (Buckley). 39 Lanai Unit Holdings Pty Ltd v Mallesons Stephen Jacques [2016] QSC 2 [19] (Jackson J). -- 23 of 30 -- [2026] WASC 262 GETHING J Page 24 62 The balance is perhaps best struck in the following observation by French J in Bryan E Fencott & Associates Pty Ltd v Eretta Pty Ltd:40 The further a plaintiff has proceeded in an action and the greater the costs it has been allowed to incur without steps being taken to apply for an order for security for costs, the more difficult it will be to persuade the court that such an order is not, in the circumstances, unfair or oppressive. 63 In my view, fairness (being the opposite to oppression) to a corporate litigant dictates that an application for security for costs should ordinarily be brought at an early stage in the proceedings. This is so that, if an order is made, the corporate litigant can make a commercial decision to either provide security for costs or allow the action to be stayed (without having it or the other parties spend the money required to complete interlocutory processes and get the action up for trial). 64 With one caveat, set out at [65] below, the reasons given by the Trackem Parties for the delay are unsatisfactory. The Counterclaim has been there since the first defence was filed on 10 June 2019. The detail now in the Counterclaim is, in my view, in part responsive to the evolving level of detail in the Claim. The financial position of the Revenue Parties is apparent from the public record. The fact that the Revenue Parties have had some issues in paying their legal fees should have come as no surprise to the lawyers for the Trackem Parties. 65 The caveat is that I accept that what became apparent from the Counterclaim Particulars is the extent of the expert evidence that will be required. This became apparent when the Counterclaim Particulars were filed on 3 October 2025. It is this expert evidence which will add a significant amount of time to the length of the trial as well as significantly increasing costs. As a broad measure of the detail and complexity of the trial, there are 89 pages of allegations in the Claim and 67 in the Defence (though both will decrease once the track changes are removed). Ms Fletcher prepared the draft bill on the basis that there would be a 15 day trial of which 10 days would be apportioned to the Counterclaim. At the hearing on 23 June 2026 counsel for the Trackem Parties expressed the view that the length of the trial is more likely to be 25 days. I agree, and would assess about 40 Bryan E Fencott & Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497, 514 (French J); Attorney-General of Botswana v Aussie Diamond Products Pty Ltd [2009] WASC 299 [23] (Kenneth Martin J) (Attorney-General of Botswana); Idoport Pty Ltd v National Australia Bank Ltd [2001] NSWSC 744 [70] - [72] (Einstein J). -- 24 of 30 -- [2026] WASC 262 GETHING J Page 25 half of that time being for the Counterclaim. Most of that time will be taken up with expert evidence. This development, in my view, provides a valid catalyst for the Trackem Parties to now seek security for their costs. 66 The concession made by counsel for the Revenue Parties ([44]) is to the effect that making an order for security for the costs of the Counterclaim would essentially stultify their ability to continue with the Counterclaim. However, there is no evidence to support this concession. Though, as it is a concession, I accept it. Where an order for security for costs would stultify the ability of the party to continue with the litigation, this will ordinarily be a factor against the making of an order for security for costs.41 67 I turn then to the exercise of the discretion. In doing so:42 [T]he section requires a balance to be struck between protecting the defendant from the possible consequences of being sued by an impecunious corporation with limited liability and avoiding injustice to the corporation by unnecessarily prejudicing it in the conduct of litigation. 68 Or put slightly differently to same effect:43 The judicial discretion in balancing these factors has been described as the balance of justice between two extremes. First, not allowing the defendant to make oppressive use of s 1335, or similar provisions, to prevent the plaintiff pursuing a genuine claim; and, secondly, not permitting the controllers of an impecunious corporation to oppress a defendant by exploiting its incapacity to pay costs. 69 An order for security for costs is not intended to be a complete indemnity for the actual costs likely to be incurred by an applicant. Rather, the security ordered should be an amount which the court in all circumstances thinks just while having regard to a reasonable estimate of the likely taxable costs.44 70 In the end, counsel for the Revenue Parties only opposed the Trackem Application on the basis of the merits of the Counterclaim and 41 Unified [13]; Spence Financial Group Pty Ltd v GE Commercial Corporation (Australia) Pty Ltd [2007] WASC 15 [39] (Newnes M) (Spence); Bell Wholesale Co Pty Ltd v Gates Export Corp (1984) 2 FCR 1, 4 (judgment of the court) (Bell Wholesale). 42 Sugarloaf [31]; Phoenix [14]Buckley, 304. 43 Braziron [39]; Modern Holdings [20]. 44 Patrick Jebb [219]. -- 25 of 30 -- [2026] WASC 262 GETHING J Page 26 delay. As I set out at [55] the merits of the Counterclaim and the Claim are essentially neutral factors to the exercise of the discretion. 71 As to delay, save for the issue of the scope of the expert evidence for the Counterclaim, the delay in bringing the application is unexplained. As set out at [63], fairness to a corporate litigant dictates that an application for security for costs should ordinarily be brought at an early stage in the proceedings so that it can make a commercial decision to either provide security for costs or allow the action to be stayed. That has not occurred. 72 A central element of the discretionary consideration is the commerciality of the dispute. The Trackem Parties claim damages in the order of $500k. The litigation has been in progress for seven years. I would be very surprised if the Trackem Parties had not incurred at least that amount again in solicitor and own client legal costs. Yet, its application for security for costs is based on the factual premise that the Revenue Parties have insufficient assets to satisfy an adverse order for costs. If that is the case, and plainly it is, it is not readily apparent that there is any prospect of the Trackem Parties recovering any judgment on the Claim should they be successful. And they are still to incur the costs of taking the Action to trial, which are said to be in excess of $550k if calculated on a party and party basis. Absent the Counterclaim, it is difficult to see any commercial utility in the Trackem Parties continuing with the Claim, though there is the issue of the shares in Trackem Holdings held by the Revenue Parties. However, they are locked into the Action by reason of the Counterclaim. Having said that, they did make the initial decision to commence an action against two impecunious companies and two individuals whom appear to have no assets against which a judgment could readily be recovered. 73 Ms McNally deposes that the costs for the trial will be $315k, based on five of the 10 days of the trial being allocated for the Defence and the remainder for the Counterclaim. The solicitor and own client costs which the Revenue Parties will have to pay are likely to be much higher. As mentioned, my estimate is more like 25 days, so the costs will be even higher. Yet, the Revenue Parties do not contest the factual evidence in the First Fletcher Affidavit to the effect that they have no assets and no other apparent financial means to meet an adverse costs order. If they can't meet an adverse costs order, how are they going to pay for their own costs and disbursements? And given the invitation to find that the Trackem Parties will not be able to meet an adverse costs order after trial, how are the Trackem Parties going to meet a -- 26 of 30 -- [2026] WASC 262 GETHING J Page 27 significant adverse judgment after trial? The position will be more acute after trial as we know from Ms Fletcher's draft bill that the Trackem Parties will need to spend at least $580k to run their case to trial, money that will not be available to satisfy a judgment. 74 As mentioned, the case management objectives in RSC O 1 r 4B are relevant, either by direct application to RSC O 25 r 1 or as an aspect of the public interest consideration for the purposes of CA s 1335(1). RSC O 1 r 4B(1)(f) relevantly provides that an action in the court 'will … be managed and supervised in accordance with a system of positive case flow management with the objects of [among others] … the procedure applicable, and the costs of the procedure to the parties, are proportionate to the financial position of each party'. In my view, the cost of the extensive expert evidence required to prove the Counterclaim would be grossly disproportionate to the financial position of each party. If the Revenue Parties want to run a counterclaim with this characteristic they may do so, but only after providing security for at least the disbursements which the Trackem Parties will incur. 75 The balance of the risks of injustice is struck by limiting the amount of security to be provided to the disbursements to be incurred by the defendants to the Counterclaim, in relation to the provision of expert evidence on the issues raised in the Counterclaim, in an amount to be fixed by the Court. Given what I have said about the quantum meruit claim, this will be included. I will hear from the parties as to the amount and the form of the security. 76 As the Revenue Parties concede, the Counterclaim will be stayed until security for these disbursements is provided. 77 The proposal by counsel for the Revenue Parties was that the Counterclaim simply be stayed. However, the broad factual matrix of the issues raised only in the Counterclaim cover the same period as those in the Claim and Defence. It would be an unjust outcome for the defendants to the Counterclaim to have to deal with the same broad factual matrix in two trials. The issue becomes more problematic if factual findings are made on the trial of the Claim and Defence which are also relevant to the Counterclaim. Moreover, the broad factual matrix goes back to 2017 and 2018. The Revenue Parties have had, in my assessment, more than a reasonable opportunity to progress their Counterclaim since it was first filed in June 2019. It is also not an appropriate use of limited court resources to have two trials covering -- 27 of 30 -- [2026] WASC 262 GETHING J Page 28 the same broad factual matrix. If the Counterclaim remains stayed as at 31 December 2026, it is to be dismissed with costs. Being dismissed, this will constitute a bar to the issues being relitigated (if that were possible given the limitation issues). 78 However, as mentioned, I must also seek to avoid injustice to the corporation by unnecessarily prejudicing it in the conduct of litigation. If the costs of the Counterclaim were to be paid forthwith upon taxation, this in my view would have the practical effect of preventing the Revenue Parties from being able to defend the Claim. That, in my assessment, would be unnecessarily prejudicing it in the conduct of the litigation. I will address this issue by staying the enforcement of any costs orders until judgment is given on the balance of the Action or other order of the Court. 79 As regards the RP and RPC, I would not have come to any different conclusion using the power in RSC O 25. The Trackem Parties did not seek orders pursuant to RSC O 25 against Mr McNally and Mr Atkinson. Determination - Saleem Application 80 I come to the same conclusion in relation to the Saleem Application. Determination - Revenue Application 81 The Revenue Application is also made pursuant to both CA s 1335(1) and RSC O 25. 82 In relation to the former, the inquiry is whether the Trackem Parties will have funds in the order of $150k to pay the costs of the Revenue Parties following judgment on the claim being given in its favour in mid-2028. 83 I do not place any weight on the evidence to the effect that artificial intelligence will have a detrimental impact on a business like that of the Trackem Parties. The evidence is too vague and general. At a similar level of vagueness and generality, the point could be made that artificial intelligence tools give businesses like the Trackem Parties opportunities that they might not otherwise have had. But there is no evidence of that either. 84 Beyond that, on the evidence relied on by the Revenue Parties, it does not appear to me, by credible testimony, that there is reason to -- 28 of 30 -- [2026] WASC 262 GETHING J Page 29 believe that the Trackem Parties will be unable to pay the costs of the Revenue Parties if successful in their Defence. Rather, the evidence is that the Trackem Parties are a solvent, operating, business. There is no evidence of any financial distress such as debt recovery actions being commenced or a statutory demand being served. As the threshold as not been met, the discretion in CA s 1335(1) is not enlivened. 85 There is no basis for a different conclusion in relation to RSC O 25. As counsel for the Revenue Parties accepts, none of the grounds set out in RSC O 25 r 2 apply. As to the factors in RSC O 25 r 3, in relation to 'the prima facie merits of the claim', I reiterate what I said at [55]: the merits of the Claim and the Defence are essentially neutral to the analysis. As to the point that the 'property within the jurisdiction may be available to satisfy any order for costs against the' Trackem Parties, the evidence relied on by the Revenue Parties shows a solvent, operating business, with no evidence of financial distress. Finally, there is nothing to suggest that the normal processes of the Court would not be available within the jurisdiction for enforcement of any order for costs made against the Trackem Parties. 86 The Revenue Application must be dismissed. What final orders are appropriate? 87 The following final orders are appropriate: 1. The plaintiffs by counterclaim provide security for the disbursements of the first and second defendants by counterclaim in relation to the provision of expert evidence on the issues raised in the counterclaim in an amount to be fixed by, and a form acceptable to, the court. 2. The plaintiffs by counterclaim provide security for the disbursements of the third defendant by counterclaim in relation to the provision of expert evidence on the issues raised in the counterclaim in an amount to be fixed by, and a form acceptable to, the court. 3. The counterclaim be stayed until security is provided in accordance with orders 1 and 2. 4. In the event that the counterclaim is stayed as at 31 December 2026, the counterclaim be and is hereby dismissed with costs to be taxed, with enforcement of the taxed costs stayed until judgment is given on the balance of the action or other order of the court. -- 29 of 30 -- [2026] WASC 262 GETHING J Page 30 5. The application by the defendants for security for costs against the plaintiffs initiated by minute of proposed orders filed 10 April 2026 be dismissed. 88 I will hear from the parties as to the amount of security to be provided in relation to expert reports and costs. If the Revenue Parties wish to recast their quantum meruit claim into something that is plausible, I am open to carving it out of the stay. I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia. OB Associate to the Hon Justice Gething 29 JUNE 2026 -- 30 of 30 --