NSW Supreme Court orders payment of funds to successful party in ‘long and tortuous litigation’

• Refuse leave to appeal on the first, second, and fourth grounds 
• Dismiss the appeal 
• Order the plaintiff to pay the defendant’s costs 
• Make the trust account of the plaintiff’s solicitors hold the funds subject to the undertaking of the orders dated 28 August 2025, not to be distributed without another court order 
• Give the defendant permission to apply to Payne JA’s chambers to release the funds held in trust 

On 7 November 2025, the plaintiff became bankrupt on his own petition, leading to the appointment of his trustee in bankruptcy. On 13 November 2025, Payne JA made orders to: 

• Direct the plaintiff’s solicitors to pay $420,463 into court from their trust account, pending a determination of entitlement to those funds, fully reserving the rights of the solicitors, the bankruptcy trustee, and Paco Nominees to provide submissions on the funds’ proper disposition 
• Join the bankruptcy trustee as the second defendant in these proceedings 
• Direct Paco Nominees to file an application under r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW) – the slip rule – to McGuire J’s chambers 
• Direct Paco Nominees, if McGuire J issued a UCPR 36.17 order, to email Payne JA’s chambers with a proposed timetable for filing and serving evidence and submissions regarding the funds held in trust 
• Direct Paco Nominees, if McGuire J did not make a UCPR 36.17 order, to file and serve an application before the Court of Appeal for leave to appeal out of time 
• Prosecute the application for leave to appeal with due dispatch 
• Give all parties liberty to apply on two days’ notice 

On 18 December 2025, McGuire J issued orders correcting the 28 August 2025 orders under UCPR 36.17 to: 

• Delete the portion of those orders directing the defendant to pay the plaintiff’s costs of the notice of motion dated 15 August 2025 
• Order the plaintiff to provide security in the defendant’s favour as a condition of granting specific orders 
• Order the immediate release of the security to the defendant upon the dismissal of the plaintiff's summons seeking leave to appeal filed on 14 January 2025 
• Direct the bankruptcy trustee to pay Paco Nominees’ costs of the notice of motion filed on 14 November 2025 

On 23 December 2025, Paco Nominees’ solicitors applied for an order for the payment to their client of the funds paid into court. 

Consent orders

The Supreme Court of New South Wales made the proposed consent orders, which sought to: 

• Pay $20,000, held by the court, to the account of the plaintiff’s solicitors 
• Pay $400,463, representing the balance of funds held by the court, to the trust account of Paco Nominees’ solicitors 

The court acknowledged Paco Nominees’ success before the NCAT and the Appeal Panel. 

The court noted that: 

• The unsuccessful plaintiff became bankrupt on his own petition shortly before a hearing where Paco Nominees could have earned the fruits of the victory 
• The trustee in bankruptcy and all other parties had an opportunity to consider the proposed orders 
• The plaintiff and the Paco Nominees consented to – and the trustee in bankruptcy did not oppose – issuing the orders