Donaldson v Secure Funding Pty Ltd [2026] QCA 135

SUPREME COURT OF QUEENSLAND CITATION: Donaldson v Secure Funding Pty Ltd [2026] QCA 135 PARTIES: MICHELLE RITA ENA DONALDSON (appellant/respondent) v SECURE FUNDING PTY LTD (ACN 081 982 872) (first respondent/applicant) STEPHEN JAMES DONALDSON (second respondent/not a party to the application) FILE NO/S: Appeal No 1738 of 2026 SC No 3806 of 2012 DIVISION: Court of Appeal PROCEEDING: Application for Security for Costs ORIGINATING COURT: Supreme Court at Brisbane – [2026] QSC 60 (Kelly J) DELIVERED ON: 20 July 2026 DELIVERED AT: Brisbane HEARING DATE: 17 July 2026 JUDGES: Brown JA ORDERS: 1. Application dismissed. 2. The costs of the application are the parties’ costs of the appeal. CATCHWORDS: APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – SECURITY FOR COSTS – where the first respondent applied for security for costs of the appellant’s appeal – where consent orders were made in 2012 for judgment in favour of the first respondent – where the first respondent obtained leave to commence enforcement proceedings in respect of the judgment under Ch 19 of the Uniform Civil Procedure Rules 1999 (Qld) in 2024 – where the appellant brought an application seeking, amongst other relief, a declaration that the enforcement proceedings were statute barred by s 10(4) of the Limitation of Actions Act 1974 (Qld) – where the primary judge, in dismissing the appellant’s application, considered he was bound by Tonkin v Johnson [1999] 2 Qd R 318 – where the first respondent applied for security for costs after the parties had substantially progressed the appeal – where the appellant is impecunious and represented by Legal Aid – where the grant of security would stifle the appeal – where appellant had exercised legal rights – whether security should be ordered -- 1 of 8 -- 2 Civil Proceedings Act 2011 (Qld), Pt 13 Limitation of Actions Act 1958 (Vic), s 5 Limitation of Actions Act 1974 (Qld), s 10(4) Uniform Civil Procedure Rules 1999 (Qld), r 799 Commercial & Process Services Australia Pty Ltd v Craven [2020] QCA 177, considered Dennehy v Reasonable Endeavours Pty Ltd (2003) 130 FCR 494; [2003] FCAFC 158, considered Ivory v Telstra Corp Ltd [2001] QCA 490, cited Lowsley v Forbes [1998] 3 All ER 897; [1998] UKHL 34, considered Mutonhori v Mount Isa City Council [2025] QCA 66, cited Natcraft Pty Ltd v Det Norske Veritas [2002] QCA 241, considered Shreeve v Jourdan (2025) 118 NSWLR 377; [2025] NSWCA 236, considered The Actors Workshop Pty Ltd v Harrison [2014] QCA 92, considered Tonkin v Johnson [1999] 2 Qd R 318; [1997] QCA 403, considered Wikeley v Kea Investments Ltd [2023] QCA 255, cited Woolworths Group Ltd v Day [2018] QCA 79, cited Woolworths Ltd v Berhane [2016] QCA 238, cited COUNSEL: M Black, with J Dickson, for the appellant P L Somers, with S S Forward-Smith, for the first respondent No appearance for the second respondent SOLICITORS: Legal Aid Queensland for the appellant Norton Rose Fulbright for the first respondent No appearance for the second respondent [1] BROWN JA: The first respondent brings an application for security for costs against the appellant. [2] The matter has a long history. On 15 June 2012, judgment was entered into by consent against the appellant and her husband, following their default as guarantors under a loan agreement to pay the first respondent. Judgment was entered for the appellant and her husband to pay the first respondent the amount of $322,479.54 plus interest under a written loan agreement and costs and for the first respondent to recover possession of specified land of the company borrower. [3] Following the consent judgment, the appellant entered into an agreement with the first respondent to pay the judgment debt by instalments. She honoured that agreement for a period of time but defaulted in May 2013. On 25 October 2016, the appellant again entered into a repayment arrangement with the first respondent and honoured her arrangements for a period of time but by March 2019 she had defaulted and ceased making payments. The balance of the judgment debt owing was approximately $103,600.19. [4] The appellant made complaints to the Australian Financial Complaints Authority (AFCA) in 2023 and also 2024, but those complaints were dismissed. On 28 May 2024, the first respondent made an ex parte application pursuant to r 799 of the -- 2 of 8 -- 3 Uniform Civil Procedure Rules 1999 (Qld) (UCPR) for leave to commence enforcement proceedings. That order was made by Martin SJA on 24 June 2024. [5] No application was made by the appellant to set aside that order. [6] On 12 September 2024, steps were taken by the first respondent in relation to seeking enforcement and on 16 September 2024 the Registrar issued a summons to the appellant to appear on 17 October 2024. That process was suspended after the appellant again made a complaint to AFCA. [7] On 13 May 2025, the appellant applied to the Supreme Court seeking a declaration that any proceeding to enforce the judgment was statute barred by the operation of s 10(4) of the Limitation of Actions Act 1974 (Qld) (Limitation Act). Section 10(4) provides that an action shall not be brought upon a judgment after the expiration of 12 years from the date on which the judgment becomes enforceable. That application was dismissed on 27 March 2026.1 [8] The present notice of appeal was filed on 24 April 2026. On 7 May 2026, an appeal hearing date was allocated for half a day on 13 August 2026 and the first respondent’s notice of contention was filed. On 21 May 2026, the first respondent gave notice to the appellant through correspondence of its intention to apply for security for costs. The first respondent allowed the appellant a period of two weeks to respond. On 25 May 2026, the appellant filed their outline of submissions for the appeal. On 4 June 2026 the appellant’s solicitors responded to the first respondent’s letter as to security for costs. That letter raised matters asserting the public importance of the appeal and that security would stifle the appeal, identifying that the appellant satisfied the means test for legal aid and asserting that the appellant would not have the capacity to raise $60,000. On 8 June 2026, the first respondent’s outline of submissions for the appeal was filed. The appellant’s reply submissions were filed on 15 June 2026. On 18 June 2026, the present application for security for costs under r 772 UCPR was filed. On 22 June 2026, the appeal record book index was approved by the Registrar and on 2 July 2026 the appeal record book was filed and served. [9] The matter is now ready for hearing. The first respondent’s solicitor has provided an estimate that its costs of the appeal up to and including a half day appeal is $60,075. Going forward from today it is estimated it will incur costs of approximately $23,000. The amounts estimated by the first respondent were not challenged by the appellant. [10] The principles to be applied as to whether to order security under r 772 UCPR are well established. The matters to which the Court has regard in determining an application for security under r 772 of the UCPR include: (a) whether the application has been made promptly; (b) a consideration of the amount sought; (c) whether the appellant is impecunious; (d) the prospects of success of the appeal; and (e) whether the making of the order would stifle the appeal (although this consideration has less significance on an appeal when somebody has already had their day in court on the issue the subject of the appeal).2 1 Secure Funding Pty Ltd v Don 1 Enterprises Pty Ltd [2026] QSC 60. 2 See Mutonhori v Mount Isa City Council [2025] QCA 66; The Actors Workshop Pty Ltd v Harrison [2014] QCA 92; Commercial & Process Services Australia Pty Ltd v Craven [2020] QCA 177 at [12]. -- 3 of 8 -- 4 [11] Other factors which are considered by the Court include whether the appeal involves a question of public importance3 and whether the application has been made promptly or there has been delay in bringing the application4 and the fact that the appellant has had their day in Court and lost.5 [12] In determining whether to grant security the Court considers the weight to be attributed to each factor and whether the balancing of all relevant factors favours the ordering of security or not.6 [13] It is not a bar to making an order for security under r 772 UCPR that the appellant is a natural person. Appellant’s Financial Position [14] There is no issue between the parties that if the appellant is unsuccessful in the appeal she will not be able to satisfy an adverse costs order. She has a grant of Legal Aid in this matter which is continuing to represent her in this appeal. The appellant’s solicitor has disclosed that the appellant satisfied the means test to qualify for Legal Aid, which includes an income test and asset test, she owns no real property since she and her husband went into default of the loan the subject of these proceedings and has no other assets against which she can borrow. The appellant’s solicitor does not further set out the appellant’s financial position.7 However, the affidavit of Ms Scott- Speyers (the first respondent’s solicitor) affirmed 17 June 2026 also supports that conclusion as searches of the appellant and an incomplete Statement of Affairs in 2024 disclose that the appellant has negligible assets, is unemployed and receives a family tax benefit. [15] The appellant’s state of impecuniosity favours the ordering of security. Prospects of Success [16] The issue in the appeal is one which is quite confined, namely, whether the primary judge erred in determining “enforcement proceedings” under Chapter 19 of the UCPR was not an “action” and therefore did not fall within s 10(4) of the Limitation Act.8 The primary judge found s 10(4) of the Limitation Act did not operate as a bar to the first respondent’s enforcement proceedings that were commenced by way of application filed on 12 September 2024, which was after the 12 year period from the entry of judgment, and dismissed the appellant’s application for a declaration to that effect.9 [17] In reaching that conclusion, the primary judge considered the case of Tonkin v Johnson,10 a decision of this Court. The primary judge observed that McPherson JA had considered the English authorities and the historical context of the limitations statues and the historic distinction between the right to sue on a judgment and a right to issue execution under it.11 The primary judge also considered those authorities. 3 Wikeley v Kea Investments Ltd [2023] QCA 255. 4 Mutonhori v Mount Isa City Council [2025] QCA 66. 5 Ivory v Telstra Corp Ltd [2001] QCA 490; Natcraft Pty Ltd v Det Norske Veritas [2002] QCA 241; Woolworths Group Ltd v Day [2018] QCA 79; Woolworths Ltd v Berhane [2016] QCA 238. 6 Wikeley v Kea Investments Ltd [2023] QCA 255 at [14]. 7 Affidavit of C L Uhr filed 26 June 2026. 8 [2026] QSC 60 at [5]. 9 [2026] QSC 60 at [70]. 10 [1999] 2 Qd R 318. 11 Which Williams J considered convinced him that the appellant was entitled to execute the judgment including the awarded interest: [1999] 2 Qd R 318 at 326. -- 4 of 8 -- 5 [18] The primary judge considered that Tonkin had settled the construction of s 10(4) of the Limitations Act which he was therefore bound by.12 [19] The first respondent contends that in order to succeed the appellant must overcome not only the decision Tonkin but also other intermediate appellate court decisions including Dennehy v Reasonable Endeavours Pty Ltd13 and the New South Wales Court of Appeal in Shreeve v Jourdan,14 both of which adopted a similar distinction to that applied in Tonkin between enforcement proceedings and the right to sue on a judgment. [20] The first respondent contends that the appellant’s prospects of the appeal are therefore poor, although it concedes it is not inarguable and that it is open for this Court to depart from its earlier decisions, but that it should only do so cautiously and when compelled to the conclusion that the earlier decision is wrong. [21] The appellant contends however that the legal landscape has changed since Tonkin due to subsequent legislative developments, including Part 13 of the Civil Proceedings Act 2011 (Qld) (CPA), which she contends has abolished the old cause of action for debt on a judgment and made Part 13 proceedings the only means of enforcement and thus the only true subject matter to which s 10(4) of the Limitation Act applies.15 That statutory regime was introduced subsequently to Tonkin and the effect of the CPA upon the Limitation Act has not received judicial consideration by this Court. The appellant further contends that in light of English authorities including Lowsley v Forbes16 not considered by Tonkin and a decision of the Hong Kong Court of Appeal,17 that the decision in Tonkin was wrongly decided. The former argument would appear to have more merit than the latter, given the extensive consideration of the historical underpinnings of s 10(4) of the Limitation Act by McPherson JA in Tonkin. [22] This Court can only make a preliminary assessment of whether the appeal can be said to be one with arguable merits as opposed to one devoid of merit. [23] There are significant difficulties for the appellant to overcome in order to succeed in her appeal, including a decision of this Court and decisions of other intermediate appellate courts. However, it is arguable that the introduction of the CPA since Tonkin and its effect on the old cause of action for debt on a judgment may affect the application of Tonkin, which has not been considered at appellate level. I find on a preliminary assessment that the appellant’s argument does have some merit, although I do not consider her prospects of success are strong. [24] Given the appeal is not inarguable, this factor does not weigh in favour of ordering security. Does the appeal raise a matter of public importance? [25] The appellant contends that the matter raises a question of public importance, namely whether s 10(4) of the Limitation Act bars, after the expiry of 12 years, the modern 12 [2026] QSC 60 at [70], [73]. 13 (2003) 130 FCR 494. 14 [2025] NSWCA 236. 15 That is disputed by the first respondent who points to the fact that clear language is needed to determine that a right of action at common law has been abolished, which is not the case under the CPA. 16 [1998] All ER 897. 17 Re Foo Shuk Man Patty [2013] HKCA 448. -- 5 of 8 -- 6 enforcement mechanisms provided for in the current version of Part 13 of the CPA and that that question is of general importance to both judgment creditors and judgment debtors. The appellant’s solicitors provided some evidence as to the general understanding that a judgment expires after 12 years. [26] That is rejected by the first respondent who relies on the fact that there is no sworn evidence in support of the argument raising a matter of public importance and rather the evidence shows that there is a misconception of the current state of the law amongst legal practitioners, represented by the correspondence from the appellant’s solicitor. [27] I do not give weight to the perception of solicitors referred to in correspondence. It is vague and ambiguous. I consider that the appellant’s counsel‘s characterisation of the question having a broader application of some general importance beyond the interests of the immediate parties, that being judgment creditors and judgment debtors, is an appropriate characterisation, given that it will determine a matter of legal principle and at least this Court has not considered the effect of Part 13 CPA and its effect on the statutory bar in s 10(4) of the Limitation Act (if there is any). This factor is of limited weight and I regard it as fairly neutral in terms of the exercise of the discretion, although more towards refusing security than favouring it. Will security stifle the appeal and has the appellant had her day in Court? [28] The weight given to the effect of the grant of security stifling an appeal where the appellant cannot meet the costs of an adverse costs order is of less weight than before trial given that the appellant has lost at first instance. In this case the first respondent also points to the fact that the appellant consented to judgment in 2012, has exercised different legal avenues to challenge recovery through AFCA and has not sought to set aside the enforcement order. That is all true, although the application at first instance appears to be the first time the question of whether enforcement proceedings are statute barred by s 10(4) of the Limitation Act was raised, and as pointed out by the appellant’s counsel, given the primary judge considered he was bound by Tonkin it is only this Court that can depart from that decision. [29] The appellant contends that any ordering of security is likely to stifle any appeal. The first respondent however contends that the Court cannot find that it will stifle the appeal given the appellant has not given evidence that she has been unable to raise money from any other source. That is true. I consider however that the appellant herself is unlikely to be able to do so given her lack of income and asset base. There is no evidence she has sought funding from any third party but conversely nor is there any evidence that anyone stands behind her or that funds could be raised further afield.18 It does not displace the likelihood that the grant of security is likely to stifle the proceedings. [30] The first respondent also contends that there must be a possibility that Legal Aid could provide the security given s 32 of the Legal Aid Queensland Act 1997 (Qld). I do not consider this argument of any weight. There is an avenue under s 32 of the Legal Aid Queensland Act for the first respondent to apply to Legal Aid for payment of a costs order made against the appellant as a legally assisted person. The appellant submits that means there is a possibility for the first respondent to eventually recover 18 [2018] QCA 79 at [33]. -- 6 of 8 -- 7 its costs in the future, but contends the possible engagement of the provision is speculative. I consider that is an accurate characterisation of the position. Given the constraints of s 32 of the Legal Aid Queensland Act, I do not consider there is any real possibility that Legal Aid could provide security given that the power under s 32 to pay an adverse costs order appears to only be enlivened when an adverse costs order is made. [31] I consider that the ordering of security is likely to stifle proceedings, although it cannot be said as an absolute, which does not favour the exercise of discretion in favour of the security. Its weight is however counterbalanced to some extent by the fact that the appellant has had her day in Court, which favours the grant of security. Was there delay in bringing the application? [32] By the time the application for security for costs was filed, the majority of steps necessary to hear the appeal, including the time and cost intensive steps of preparing outlines of submissions, had occurred. The appeal is now essentially ready to be heard with the appeal book having been filed, albeit that was filed after this application was made. Time will of course have to be spent preparing for the hearing. Even on the first respondent’s estimate of its total costs of the appeal of $60,075, just over a third of the cost, some $23,000, relates to the preparation for an appearance at the hearing of the appeal with the remainder of the costs having already been incurred before the application was made. In this case, it is of some relevance that through Legal Aid, public monies have been expended on the preparation of written submissions and in preparing the appeal book. [33] The first respondent contends it did not unduly delay and states that its application was filed within weeks of its receipt of the appellant’s response. The first respondent points to the fact that it allowed the appellant’s solicitors two weeks to respond to its letter of 21 May 2026 and that the response was not received until 4 June. However, that response made clear that no security would be provided and the application was still not filed for two weeks after the response, during which further work was done and costs incurred. The fact that the first respondent gave extra time for the appellant’s response is of little significance given that the date of 4 June was the date nominated by the first respondent in its letter of 21 May for the appellant to respond. [34] The context of the delay is important. The delay in this case is not lengthy but it is significant. By 7 May 2026 the appeal hearing date was set. A timetable had been provided by the Registrar for the steps to be taken by the party to ensure the parties’ readiness for hearing by a letter dated 24 April 2026. Given that the first respondent knew by 24 April 2026 that the appellant had been granted Legal Aid and that searches had revealed she had no property or assets to fund the appeal, which was supported by the limited financial disclosure made to the first respondent, it could not have been reasonably expected that security would be provided. While the first respondent contends that it was appropriate to await the appellant’s outline, this was not a case where it realistically needed to await the outline to evaluate the issues involved and prospects. The notice of appeal, consistent with the argument presented by the appellant at first instance, made clear that the questions to be raised upon appeal were confined to one of construction and whether Tonkin continued to be binding. The first respondent must have reasonably anticipated from the time of the notice of appeal that it might not recover costs incurred if successful and could have applied for security for costs shortly after the notice of appeal was filed. It was -- 7 of 8 -- 8 certainly in a position to do so by 25 May 2026 once it had the appellant’s outline. In any event, once the first respondent received the response from the appellant on 4 June 2026 it should have made its application immediately. [35] Delay is not a disentitling factor to the ordering of security and may lead the Court to limit the amount of security rather than refusing security. [36] In the circumstances of this case, the delay in bringing the application has resulted in significant steps being taken by the parties and costs being incurred. Even taking the most generous view that the first respondent did not delay until receiving the response on 4 June, the first respondent’s submissions, the appellant’s reply submissions and a draft index for the appeal books were prepared. The delay between the response and the filing of the application, particularly where the first respondent knew the appellant was being funded through Legal Aid, weighs against the first respondent’s argument that to the extent the Court finds any delay it should only limit the amount of security to the costs of the appeal going forward, as opposed to refusing the application. Conclusion [37] It is evident from the above discussion that there are some factors weighing in favour of ordering security and some which favour its refusal in the circumstances of this case. While a preliminary assessment indicates that the prospects of success are not strong, the appeal has some merit. That together with the fact that there has been some delay which is significant in the context of the case, do not favour the exercise of the discretion in favour of the grant of the security. The parties have taken the majority of the required steps so the matter is essentially ready to be heard and have incurred costs during the period when the application for security could have been made more promptly. It is also likely that the appeal will be stifled if security is granted. Most of the cost had already been incurred by the time the application was filed and the appeal itself will be reasonably short. It is of some, albeit limited weight that the appeal does raise a matter of legal principle and is of broader significance than just the parties’ interests. Those factors outweigh the fact that the appellant is impecunious and has exercised her legal rights including by seeking the declaration at first instance both of which favour ordering security. [38] Having weighed up all of the factors, I consider that, notwithstanding the likelihood that the first respondent will not be paid its costs in the event that it is successful on the appeal, the application should be refused. The parties did not make any submissions as to costs. In the circumstances, the appropriate order is that the costs of the application should be the parties’ costs on the appeal. Orders [39] In the circumstances the orders should be: 1. Application dismissed; 2. The costs of the application are the parties’ costs of the appeal. -- 8 of 8 --