A very recent handy case summarises this for us (please note that these are only general in nature):
1. A liquidator who brings proceedings, and loses, may have recourse to the liquidated company’s pool of assets to meet the costs.
2. If the liquidator has acted unreasonably, they cannot rely upon no. 1.
3. If a company in liquidation brings proceedings (without the liquidator as party), then the defendant is entitled to security for costs.
4. If a liquidator of company brings proceedings, then the defendant is not entitled to security for costs.
5. If a liquidator is a party to defending a proceedings, and loses, the liquidators liability is limited to the pool of assets of the liquidated company.
6. If the liquidator has acted unreasonably, they cannot rely upon no. 5.
7. If the liquidator is not a moving party in the proceedings, but has unreasonably forced a party to take proceedings to enforce a right, then they cannot rely upon 5.
Unreasonable defined (to include): “not guided by or based on good sense” and “beyond the limits of acceptability or fairness”.
Link to the case: https://jade.io/j/#!/article/596772?at.hl=%255B2018%255D+NSWSC+1129