A226 of 2003 v Minister for Immigration (No.2 )
[2005] FMCA 17
•14 January 2005
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| A226 of 2003 & ORS v MINISTER FOR IMMIGRATION (No.2 ) | [2005] FMCA 17 |
| PRACTICE & PROCEDURE – COSTS – MIGRATION – Consideration of the obligations on the Commonwealth as a model litigant and under the Financial Management and Accountability Act 1997 (Cth). |
Federal Magistrates Court Rules 2001 (Cth)
Financial Management and Accountability Act 1997 (Cth)
Judiciary Act 1903 (Cth)
Applicant A226/2003 & Ors v Minister for Immigration [2004] FMCA 772
| First Applicant: Second Applicant: | APPLICANT A226 of 2003 SZDFR |
| Respondent: | MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS |
| File No: | SYG1021 of 2004 |
| Delivered on: | 14 January 2005 |
| Delivered at: | Sydney |
| Hearing date: | Decided on written submissions |
| Judgment of: | Driver FM |
REPRESENTATION
The parties relied on their written submissions
| Solicitors for the Respondent: | Mr A Crockett Australian Government Solicitor |
ORDERS
The first and second applicants are to pay the Minister’s costs and disbursements of and incidental to the application, fixed in the sum of $2,000.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG1021 of 2004
| APPLICANT A226 of 2003, SZDFR, SZDFS, SZDFT |
Applicants
And
| MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS |
Respondent
REASONS FOR JUDGMENT
On 12 November 2004 I gave reasons for declining at that time to make a costs order in favour of the Minister in this matter.[1] In those reasons I said that prima facie the Minister should receive an order for costs but I was reluctant to make an order until I could be satisfied that the issue had been properly considered by or on behalf of the Minister. I was concerned at the possible impact of a costs order upon the health and welfare of the child applicants and I was concerned to give the Minister the opportunity to consider whether costs would be pressed against the applicants if an order were made. I was concerned that it would be inconsistent with the model litigant principle to seek costs against an opposing party if there were no intention to enforce the costs order that might be made.
[1] Applicant A226/2003 & Ors v Minister for Immigration [2004] FMCA 772
I have now received the following further submissions on behalf of the Minister which were filed in my chambers today:
(1)In this matter the Respondent made a costs application following the discontinuance of the proceedings by the Applicants. In the reasons for judgment dated 12 November 2004 (the reasons) at [9] Driver FM declined to determine the issue of costs at that stage and instead adjourned the Respondent’s application until his Honour could be satisfied that the issue of the seeking of a costs order had been properly considered by or on behalf of the Respondent at an appropriately senior level.
(2)Driver FM further indicated that if it was confirmed that the Minister pressed the costs application with the intention of seeking to enforce it, he would make an order against the first and second applicants on the basis that only stage 1 of the proceedings was completed for the purposes of schedule 1 to the Federal Magistrates Court Rules 2001 (Cth) (“the Federal Magistrates Court Rules”).
(3)Having regard to his Honour’s comments, the question of whether the Minister should press for a costs order was given consideration at a senior level within the Department of Immigration and Multicultural and Indigenous Affairs (the Department). The Department’s position is that the Respondent wishes to press the application for costs but the Department has no final view at this time whether they will enforce any order. The Department takes the view that it will be most appropriate that any decision about waiver or write-off is made at the time when the enforcement of any order is considered.
Submissions
Legal Services Directions / Model Litigant Policy
(4)At [6] of the reasons, Driver FM acknowledged that the applicants’ impecuniosity is not a reason for not awarding costs to the respondent as the successful party and that “Prima facie, the Minister should receive an order for costs”. This is consistent with the usual position that costs follow the event. However, at [7], Driver FM observed that in his view, the Commonwealth, as the model litigant, should not seek a costs order if there is no intention to seek to enforce it.
(5)The Department accepts that it is subject to the Legal Services Directions (“LSDs”) issued by the Attorney-General pursuant to s.55ZF of the Judiciary Act 1903 (Cth), paragraph 4.2 of which requires that litigation by an FMA[2] agency is to be conducted in accordance with the Directions on the Commonwealth's Obligation to Act as a Model Litigant, which is Appendix B to the LSDs.
[2] Financial Management and Accountability Act 1997
(6)Note 5 to Appendix B to the Legal Services Directions makes it clear that neither seeking nor enforcing costs orders is a breach of the Commonwealth’s obligation to act as a model litigant. Note 5 states:
(7)The [model litigant] obligation does not prevent the Commonwealth from enforcing costs orders or seeking to recover its costs.
(8)Having regard to Driver FM’s comments regarding the model litigant, the Respondent has consulted the Office of Legal Services Co-ordination (OLSC) in the Attorney-General’s Department. OLSC supports the Attorney-General in his First Law Officer role including to assist Departments and agencies to understand and comply with the LSDs, including the Model Litigant Policy. OLSC have advised the Respondent that it is consistent with their interpretation of the model litigant provisions that as a general proposition the Commonwealth should seek costs where it is successful in proceedings, even if steps may not be taken to enforce that order.
(9)The Respondent submits that it goes too far to suggest that the model litigant policy requires, as a rule, that before seeking a costs order, the Commonwealth must decide in advance whether they will seek to enforce it. Rather, the seeking and enforcement of costs orders are separate stages in the handling of proceedings and may, quite properly, turn on different considerations. For example, at the time a costs order is sought there may be insufficient information available regarding the financial circumstances of the other party for the Commonwealth to determine whether enforcement action will be appropriate. In this situation the agency will not be in a position to have properly decided in advance not to seek an order, although it is possible that there might be a waiver or write-off of the debt in the future depending on whether the circumstances are found to justify that course at that stage.
(10)Analysed this way, there is nothing objectionable in an agency pressing for a costs order against an apparently impecunious party on the basis that if the party’s financial circumstances change for the better, the order will in all probability be enforced. Of course, if they do not change, the agency will need to consider whether the debt should be written-off or waived.
Financial Management and Accountability Act
(11)The Respondent submits that it is in line with good administrative practice, and the Department’s obligations under the Financial Management and Accountability Act 1997 (Cth) (FMA Act), to obtain a costs order where there is a prima facie entitlement although no present decision has been made not to enforce it. The question should be dealt with as a discretionary issue for the Department to decide having regard to its FMA obligations rather than as a model litigant issue.
(12)Under the waiver and write-off provisions in the FMA Act a debt may be waived or written-off as a matter of discretion. However, it is clear that these discretions will only arise for consideration once there is a debt or an amount owing to the Commonwealth.
(13)In this regard, the Respondent notes that Attachment D to Finance Circular 2001/01 advises that an unliquidated amount is not an amount owing for the purposes of s.34 (which governs waiver of debts). The Finance Circular gives as an example of an unliquidated amount a court order for costs which has not been taxed. Of course, in the present case, there is, as yet, not even an order.
(14)Under s.47 (which governs write-off of debts), an agency must pursue recovery of a debt unless an Act authorises it being written off, or the CEO considers it is not legally recoverable, or it is uneconomical to pursue. Because no debt has crystallized in relation to the costs in the present proceedings, these discretions would not fall to be considered at this stage.
(15)Normally, an FMA agency’s decision whether to seek costs is properly governed by reference to s.44 of the FMA Act (which requires an agency Chief Executive to manage an agency’s affairs in a way that promotes the proper use of Commonwealth resources) and legal principle and practice rather than broader issues of equity, although these certainly may come into play once a debt has been crystallized and an issue of waiver arises. While the Respondent accepts that there may be cases where it will be appropriate for an FMA agency to decide in advance not to seek a costs order, in most cases a Chief Executive (or delegate) would be obliged by s.44 to pursue a costs order.
(16)It is consistent with the Commonwealth’s policies relating to the use and management of public money that the general expectation is that agencies will seek costs orders when they are entitled to them.
Conclusion
(17)The Respondent submits that the absence of a present concluded intention to enforce any costs order is not of itself a reason why a costs order should not be made in favour of the Respondent as the successful party.
(18)The appropriate order is that the First and Second Applicants pay the Respondent’s costs on the basis that only stage 1 of the proceedings was completed for the purposes of schedule 1 to the Federal Magistrates Court Rules.
Subject to my comments which follow, I accept those submissions. With regard to paragraph 8 of the submissions, it was not my intention to suggest that the model litigant principle requires the Commonwealth to consider write off or waiver of a debt in advance of a costs order. Rather, it was my intention to suggest that it would not be consistent with the model litigant principle to seek a costs order if there were no intention to enforce it. The circumstances in this matter suggested to me that it might be desirable for the Minister to consider whether a costs order would be enforced prior to a costs order being made. I note from the submissions that the Minister’s Department has chosen not to take up that opportunity.
Paragraphs 12 and 13 of the submissions overlooks the fact that it is the practice of the Court to fix costs in a specific amount in migration proceedings. An order for costs in a specific amount establishes a debt. With regard to paragraph 14 of the submissions, it follows that the obligation under s.47 of the Financial Management and Accountability Act 1997 (Cth) arises as soon as an order is made. I do not have a high degree of confidence that that obligation has been thoroughly pursued in the past in many migration proceedings. Rather, it appears that many applicants are required or permitted to leave the country without any effort at recovery being made and without any decision on write off or waiver being made. I doubt that such a practice is consistent with the obligation arising out of s.47.
In my earlier reasons I said that if the costs application were pressed I would make a costs order on the basis that stage 1 of the proceedings had been completed before the application was discontinued. It is clear from the submissions that the application for costs is pressed. I will accordingly order that the first and second applicants pay the Minister’s costs and disbursements of and incidental to the application, which I fix in the sum of $2,000.
I certify that the preceding five (5) paragraphs are a true copy of the reasons for judgment of Driver FM
Associate:
Date: 14 January 2005
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