Abdou and Victorian Building Authority
[2020] AATA 2637
•2 June 2020
Abdou and Victorian Building Authority [2020] AATA 2637 (2 June 2020)
Administrative Appeals Tribunal
ADMINISTRATIVE APPEALS TRIBUNAL )
)No: 2017/2286 and 32 others.
GENERAL DIVISION )
Re: Mouhammed Abdou and 32 others listed in Attachment A to these reasons
Applicant
And: Victorian Building Authority
RespondentCORRIGENDUM TO DECISION OF 2 JUNE 2020
TRIBUNAL: Deputy President S A Forgie
DATE OF CORRIGENDUM: 9 July 2020
PLACE: Melbourne
The Tribunal amends its decision of 2 June 2020 by:
1.at Attachment A row number 18 in the ‘file number’ column removing ‘2017/0144’ and inserting ‘2017/0833’.
2.at Attachment A row number 29 in the ‘file number’ column inserting ‘2018/3186’.
3.at Attachment A row number 30 in the ‘file number’ column inserting ‘2018/4924’.
……[sgd]……………………
S A FORGIE
Deputy President
Division:GENERAL DIVISION
File Number: 2017/2286 and 32 others listed in Attachment A to these reasons
Re:Mouhammed Abdou and 32 others listed in Attachment A to these reasons
APPLICANT
AndVictorian Building Authority
RESPONDENT
DECISION
Tribunal:Deputy President S A Forgie
Date of decision: 2 June 2020
Place:Melbourne
The Tribunal decides to:
refuse to make an order for costs against the respondent in each of the 33 applications listed in Attachment A to these reasons.
……………[sgd]………………………
Deputy President S A Forgie
Catchwords
COSTS – mutual recognition – whether costs should be ordered under s 35 of the Mutual Recognition Act 1992 – meaning of costs – who can be awarded costs – meaning of proceedings – whether actions of a party in proceedings considered unreasonable – costs not awarded.
Legislation
Acts Interpretation Act 1901; s 33(2A)
Administrative Appeals Tribunal Act 1975; s 42C; s 69A
Building Act 1993 (Vic)
Federal Court Rules 2011; Schedule 1
Freedom of Information Act 1982
Law and Justice Legislation Amendment Act (No. 2) 1995
Legal Profession Uniform Law Application Act 2015 (Vic)
Legal Profession Uniform Law (NSW)
Legal Profession Act 2007 (Qld)
Military Rehabilitation and Compensation Act 2014
Mutual Recognition Act 1992; s 7; s 29; s 35
Safety, Rehabilitation and Compensation Act 1988
Supreme Court (General and Civil Procedure) Rules 2015 (Vic)
Supreme Court Rules 1970 (NSW)
Water Services Licensing Act 1995 (WA)
Water Services Licensing (Plumbers Licensing and Plumbing Standards) Regulations 2000 (WA)
Cases
Ada Evans Chambers Pty Ltd v Santisi [2014] NSWSC 538
Agapis v A Deputy District Registrar of the Federal Court of Australia at Perth [2016] HCATrans 154
Alexandra Private GeriatricHospital Pty Ltd v Blewett [1984] FCA 223; (1984) 2 FCR 368; 56 ALR 265
Andriotis v Victorian Building Authority [2018] FCAFC 24
Attorney-General (NSW) v Brewery Employees Union of New South Wales (1908) 6 CLR 469
Australian Securities Commission v Aust-Home Investments Limited [1993] FCA 585; (1993) 44 FCR 194; 116 ALR 523; 11 ACSR 136
Beach Petroleum NL v Johnson (No. 2) [1995] FCA 350; (1995) 57 FCR 119; 135 ALR 160
Bell Lawyers Pty Ltd v Janet Pentelow [2019] HCA 29; (2019) 93 ALJR 1007
Cachia v Hanes [1994] HCA 14; (1994) 179 CLR 403; 120 ALR 385
Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] FCA 23
Guss v Veenhuizen [1976] HCA 57; (1976) 136 CLR 47; 12 ALR 271
Hartford Holdings Pty Ltd v CP (Adelaide) Pty Ltd [2004] SASC 161
Lake v Municipal Association of Victoria (No 2) [2018] VSC 660
London Scottish Benefit Society v Chorley (1884) 13 QBD 872
Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24; 66 ALR 299
Re Andriotis and Victorian Building Authority [2017] AATA 378
Re Cleary and Nurses’ Board of the Northern Territory (1996) 41 ALD 395; 23 AAR 239
Re Hughes and Western Australian Cricket Association [1986] FCA 382
Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin 186 CLR 622; (1997) 143 ALR 1
Re Tkacz; Ex parte Tkacz [2006] WASC 315; (2006) 206 FLR 171
Re Wright and Nurses Board of the Australian Capital Territory [1996] AATA 196; 41 ALD 411; 23 AAR 231
Site Skills Group Pty Ltd v Administrative Appeals Tribunal (No 2) [2020] FCA 78
Umoona Tjutagku Health Service Aboriginal Corporation v Walsh [2019] FCAFC 32
Victorian Building Authority v Andriotis [2019] HCA 22; (2019) 372 ALR 1
Wentworth v Wentworth [1999] NSWC 638
Winn v Garland Hawthorn Brahe (Ruling No 1) [2007] VSC 360
Yates Property Corporation Pty Ltd v Boland [2000] FCA 1106; (2000) 179 ALR 664Secondary materials
Lord Coke’s Commentary 2 Inst. 288 of the Statute of Gloucester 6 Edw, 1, c. 1
Second Reading Speech by the Minister for Science and Technology and the Minister Assisting the Prime Minister; Senate Hansard, 3 November 1992 at 2432REASONS FOR DECISION
Deputy President S A Forgie
1.On 30 March 2017, the predecessor of the Victorian Building Authority (VBA), the Victorian Building Practitioners Board (Board), refused applications made by a number of applicants for registration in various occupations in the building industry. The applications were made under the Mutual Recognition Act 1992 (MR Act). The Board, which was abolished and its decisions taken to be those of the VBA,[1] refused each application on the basis that it was not satisfied that the applicant was a fit a proper person to practise as a building practitioner as required by s 170(1)(c) of the Building Act 1993 (Vic) (Building Act) as it was then in force.[2] Most applicants, including those in Attachment A, agreed with the VBA that their applications in the Tribunal should be held in abeyance while one of the applications was heard as a “test case”.
[1] Building Act 1963; s 273; Schedule 8; cll 3 and 6
[2] The Building Act was subsequently amended by the Building Amendment (Enforcement and Other
2.That test case was Re Andriotis and Victorian Building Authority[3] (AAT Andriotis). The Tribunal affirmed the Board’s decision.[4] Mr Andriotis appealed from the Tribunal’s decision to the Full Court of the Federal Court, which allowed the appeal on 21 February 2018 in Andriotis v Victorian Building Authority[5] (FFC Andriotis). An appeal to the High Court by the VBA was dismissed on 11 November 2019 in Victorian Building Authority v Andriotis[6] (HCA Andriotis). Following the delivery of the High Court’s judgment, a number of applications have been resolved between the parties and concluded with decisions made under s 42C of the Administrative Appeals Tribunal Act 1975 (AAT Act). In each case, the Tribunal has made a decision to set aside the VBA’s decision and to substitute a decision granting the application under the MR Act in a particular occupation that is specified in each decision.
[3] [2017] AATA 378; Senior Member Fice
[4] [2017] AATA 378; Senior Member Fice
[5] [2018] FCAFC 24; (2018) 259 FCR 354; 359 ALR 427; 74 AAR 78
[6] [2019] HCA 22; (2019) 372 ALR 1; Kiefel CJ, Bell, Gageler, Keane, Nettle, Gordon and Edelman JJ
3.On behalf of 33 applicants listed in the Attachment to these reasons, Mr Richard Franks sought an order that the VBA pay costs totalling $227,892. The Attachment sets out the precise amount sought by each applicant. One of the applicants named in the Attachment, Mr Ruzeu, named Mr Franks as his representative when he lodged two applications on 30 May 2018 but, since the first conference was held on 25 July 2018, Mr Ruzeu has been represented by solicitors. Those solicitors were representing him when he and the VBA reached an agreement under s 42C of the AAT Act. I have not considered Mr Franks’ application in respect of Mr Ruzeu further because, like five other applicants, Messrs Charchar, Serpentino, Mafilovski, Condon and Ryder, the decision made by the Tribunal under s 42C included a decision to the effect that “the parties bear their own costs of the application, there is no order as to costs”. For reasons I give later, that means that I have no power to make a further costs order.
4.In the remaining 27 of the 33 cases, the question of costs was reserved to be heard and decided at a later date. Section 35 of the MR Act provides that the Tribunal may order a party in the proceedings to pay costs if the party has behaved unreasonably. Submissions have been made on behalf of the applicants and the VBA. I have decided to refuse those applications for the reasons I give below.
LEGISLATIVE FRAMEWORK
The Mutual Recognition Act 1992
5.The MR Act is “An Act to provide for the recognition within each State and Territory of the Commonwealth of regulatory standards adopted elsewhere in Australia regarding goods and occupations.”[7] Part 3 of the MR Act sets out the mutual recognition principle as it applies to individuals and occupations carried on by them.[8] Section 17 provides:
[7] MR Act; Long Title
[8] MR Act; s 18(1)
“(1) The mutual recognition principle is that, subject to this Part, a person who is registered in the first State for an occupation is, by this Act, entitled after notifying the local registration authority of the second State for the equivalent occupation:
(a)to be registered in the second State for the equivalent occupation; and
(b)pending such registration, to carry on the equivalent occupation in the second State.
(2)However, the mutual recognition principle is subject to the exception that it does not affect the operation of laws that regulate the manner of carrying on an occupation in the second State, so long as those laws:
(a)apply equally to all persons carrying on or seeking to carry on the occupation under the law of the second State; and
(b)are not based on the attainment or possession of some qualification or experience relating to fitness to carry on the occupation.”
6.The equivalence of occupations carried on in different States is to be determined in accordance with Part 3 and, particularly in accordance with Division 4 of that Part. The general principles are set out in s 29:
“(1) An occupation for which persons may be registered in the first State is taken to be equivalent to an occupation for which persons may be registered in the second State if the activities authorised to be carried out under each registration are substantially the same (whether or not this result is achieved by means of the imposition of conditions).
(2)Conditions may be imposed on registration under this Part so as to achieve equivalence between occupations in different States.
(3)This section has effect subject to any relevant declarations in force under this Division.”
7.A Minister from each of two or more States may jointly declare by notice in the Gazette, that specified occupations are equivalent and may specify or describe conditions that will achieve equivalence. That declaration, which may be amended or rescinded, has effect only in relation to the States concerned. The appropriate local registration authority is to give effect to the declaration. This is the effect of s 32 of the MR Act.
8.On review of a decision made by a local registration authority, of which the VBA is one,[9] the Tribunal may make an order that a person who is registered in a particular occupation in one State is, or is not, entitled to registration in a second State in a particular occupation. The Tribunal may specify or describe conditions that will achieve equivalence.[10] On such a review, the Tribunal may make a declaration that occupations carried on in two States are not equivalent, but only if it is satisfied of the matters specified in s 31(2). If the Tribunal makes a declaration, its Registrar must cause a notice setting out the terms of the declaration to be promptly published in the Gazette.[11] A declaration made on the basis of s 31(2)(b) has effect for no longer than 12 months. The local registration authority must promptly notify the appropriate authorities in each other State and the Commonwealth of the declaration.[12] Section 31(5) provides that:
“The local registration authority is to give effect to the decision on the review, and must thereafter act in conformity with the decision in relation to other persons seeking registration.”
[9] “local registration authority of a State for an occupation means the person or authority in the State having the function conferred by legislation of registering persons in connection with their carrying on that occupation in the State.”: MR Act; s 4(1)
[10] MR Act; s 31(1)
[11] MR Act; s 31(3)
[12] MR Act; s 31(4)
9.A person, who is registered in the first State for an occupation may lodge a written notice with the local registration authority of the second State for the equivalent occupation seeking registration for that equivalent occupation in accordance with the mutual recognition principle. The notice must comply with ss 19(2) to (5) by providing certain information. Registration must be granted within one month of lodgement of that notice but, subject to Part 3 of the MR Act, the local registration authority may postpone or refuse the grant of registration.[13] If it is granted, registration takes effect from the date the person lodged the notice under s 19.[14]
[13] MR Act; s 21(3)
[14] MR Act; s 21(2)
10.A local registration authority may postpone the grant of registration in the circumstances set out in s 22(1):
“(a) any of the statements or information in the notice as required by section 19 are materially false or misleading; or
(b)any document or information as required by subsection 19(3) has not been provided or is materially false or misleading; or
(c)the circumstances of the person lodging the notice have materially changed since the date of the notice or the date it was lodged; or
(d)the authority decides that the occupation in which registration is sought is not an equivalent occupation.”
11.If the grant of registration has been postponed, the local registration authority may, in due course, grant or refuse the registration. It may not postpone the grant of registration for longer than six months.[15] Unless registration has been refused within that six month period, the person is entitled to registration at the end of the period.[16]
[15] MR Act; s 22(2)
[16] MR Act; s 22(3)
12.A local registration authority may refuse the grant of registration in the circumstances set out in s 23(1):
“(a) any of the statements or information in the notice as required by section 19 are materially false or misleading; or
(b)any document or information as required by subsection 19(3) has not been provided or is materially false or misleading; or
(c)the authority decides that the occupation in which registration is sought is not an equivalent occupation and equivalence cannot be achieved by the imposition of conditions.”
13.The local registration authority must give the person who lodges a notice in accordance with s 19, a written notice of its decision to grant or refuse a grant of registration, to postpone a grant or to impose conditions on registration.[17]
[17] MR Act; s 24
14.A person who lodges a notice under s 19 with a local registration authority is taken to be registered pending the grant or refusal of the registration. This is deemed registration, which continues until it is cancelled, the person’s substantive registration in the first or second State ceases or the person is substantively registered in the second State in connection with the occupation concerned.[18] A person who has deemed registration in the second State may carry on the occupation in the second State as if the deemed registration were substantive registration but with certain limitations. Those limitations are that the person do so within the limits conferred by the person’s substantive registration in the first State and of the deemed registration in the second, subject to any conditions or undertakings in the first State unless waived by the second State and subject to any conditions applying to the deemed registration. The local registration authority of the second State may impose conditions as if deemed registration were substantive registration provided those conditions are not more onerous that would have been imposed in similar circumstances if it were registration effected apart from Part 3 of the MR Act, correspond to conditions or undertakings applying in the first State or are necessary to achieve equivalence.[19]
[18] MR Act; s 26(1)–(4)
[19] MR Act; s 27
15.Subject to the AAT Act, an application may be made to the Tribunal for review of a decision of a local registration authority. The application may be made by a person whose interests are affected by the decision.
16.Section 35 of the MR Act provides:
“The Tribunal may order a party in proceedings before it to pay costs if the party has acted unreasonably.”
The word “costs” is not defined in the MR Act and the reference to a “party in proceedings” must be understood to have its meaning determined in the context of the application made to the Tribunal under s 34 of the MR Act.
The Administrative Appeals Tribunal Act 1975
17.Section 69Aof the AAT Act sets out a procedure for taxing costs once the Tribunal has made an order that they be paid:
“If
(a)the Tribunal has, under this Act or another enactment, ordered a party to a proceeding to pay reasonable costs incurred by another party; and
(b)the parties cannot agree on the amount of those costs;
the Tribunal or an officer of the Tribunal may tax the costs.”[20]
[20] AAT Act; s 69A(1)
If an officer of the Tribunal has taxed the costs, either party may apply to the Tribunal for review of the taxed amount.[21] On review, the Tribunal may affirm the amount, set aside the amount and substitute another amount or set aside the amount and remit the matter to the officer of the Tribunal to be taxed in accordance with its directions.[22] Any amount that a party to a proceeding is required to pay is recoverable as a debt.[23]
[21] AAT Act; s 69A(2)
[22] AAT Act; s 69A(3)
[23] AAT Act; s 69A(4)
RE AGAPIS AND PLUMBERS LICENSING BOARD
18.The case of Re Agapis and Plumbers Licensing Board[24] (Agapis) concerned an application made by Mr Agapis to the Western Australian Plumbers Licensing Board (PLB) for a Plumbing Contractor’s licence. He applied under the MR Act. Mr Agapis had been convicted of four offences and was, at the time of his application under the MR Act facing charges of aggravated burglary and common assault in New South Wales. He was subsequently convicted of burglary and sentenced to imprisonment for one year and three months suspended for two years. He did disclose the convictions or the charge when answering the relevant question when applying under the MR Act for a licence in Western Australia. The PLB refused his application on the basis that he did not satisfy the fit and proper requirement set out in r 17(1)(a) of the Water Services Licensing (Plumbers Licensing and Plumbing Standards) Regulations 2000 (WA) (WSL Regulations) made under the Water Services Licensing Act 1995 (WA) (WSL Act).
[24] [2013] AATA 187; Senior Member Penglis
19. Mr Agapis sought various relief before applying to the Federal Court on the basis that the Tribunal was exercising a judicial function contrary to the Commonwealth Constitution. In Agapis v Plumbers Licensing Board,[25] Siopis J dismissed the appeal on the basis that it was not exercising judicial power. Leave to appeal was refused by Gilmour J in Agapis v Plumbers Licensing Board (No. 2)[26] and his Honour also made an order prohibiting Mr Agapis from instituting further proceedings in the Federal Court. Mr Agapis attempted to lodge an appeal against the judgment and order of Gilmour J and a Deputy District Registrar of the Federal Court refused to accept it. Mr Agapis applied for relief in the High Court but his application was refused.[27]
[25] [2013] FCA 1221
[26] [2104] FCA 1045
[27] Agapis v A Deputy District Registrar of the Federal Court of Australia at Perth [2016] HCATrans 154
20.The Tribunal decided that there is nothing in the MR Act that precludes a licensing authority such as the PLB, from considering and applying the fist and proper requirement set out in r 17(1)(a). It relied on a judgment of the Full Court of the Supreme Court of Western Australia in Re Tkacz; Ex parte Tkacz.[28] The Full Court had considered the relevant provisions of the MR Act in the context of Mr Tkacz’s application for admission as a legal practitioner based on his admission to practice as a lawyer of the Supreme Court of New South Wales. Mr Tkacz had been convicted of a criminal offence, which he had disclosed to the Supreme Court of New South Wales.
[28] [2006] WASC 315; (2006) 206 FLR 171; Martin CJ, Murray and Templeman JJ
21.The Full Court considered the Legal Practice Act 2003 (WA) (Legal Practice Act) and concluded that it had preserved the inherent jurisdiction of the Supreme Court with respect to the supervision of the conduct of legal practitioners and its inherent power to determine who would be accepted as practitioners of the Court. It went on to consider the MR Act and concluded that the Court’s power to determine who should be admitted to its Roll, irrespective of whether or not they possess the requisite educational qualifications and experience, is unaffected by the MR Act. The Court’s power applies equally to applicants for admission under the MR Act as it does for admission of those who relied on the Legal Practice Act. The reasoning of the Full Court leading to its conclusion was set out in the following paragraphs:
“ The LPA is a law that regulates the manner of carrying on the occupation of legal practitioner in the State of Western Australia. It recognises the power of the Court to refuse to admit a person to the practice of that occupation even though he or she may have all the specified qualifications or experience necessary to fit them to carry on that occupation. It is a law which applies equally to all persons carrying on or seeking to carry on the occupation of legal practitioner in Western Australia. Accordingly, the clear and express effect of s 17(2) of the MRA(Cth) is to provide that the mutual recognition principle does not affect the operation of that aspect of the LPA.
Section 20 of the MRA(Cth) should be read and construed consistently with the clear purpose and effect of s 17(2). So, where s 20(1) refers to a law of the second State expressly providing that ‘registration in the first State is a sufficient ground of entitlement to registration’ it should be taken to be a reference to a sufficiency of the qualifications or experience necessary to secure registration. Moreover, the proposition that s 20(1) was not intended to compel registration in the second State contrary to the exception to the mutual recognition principle expressly established by s 17(2) is reinforced by s 20(2) of the MRA(Cth), which provides:
(2)The local registration authority may grant registration on that ground and may grant renewals of such registration.
The use of the word ‘may’ rather than the imperative ‘shall’ is consistent with the approach reflected in the High Court's decision in In Re Davis (supra) [(1947) 75 CLR 409] and with the scheme of provisions such as s 28 of the LPA. That conclusion is further reinforced by s 20(4) of the MRA(Cth) which provides:
(4)Continuance of registration is otherwise subject to the laws of the second State, to the extent to which those laws:
(a)apply equally to all persons carrying on or seeking to carry on the occupation under the law of the second State; and
(b)are not based on the attainment or possession of some qualification or experience relating to fitness to carry on the occupation.
So, the language of s 17(2) of the MRA(Cth) is replicated in s 20(4) of that Act, relating to continuance of registration. The long standing capacity of the superior courts to determine that only the persons with the requisite personal qualities of character be admitted to, or remain on, the Roll would not easily fit within the description of ‘some qualification or experience’. Accordingly, that capacity of the superior courts, including the Supreme Court of Western Australia, remains unaffected by the mutual recognition legislation.
Nor is any other conclusion supported by the language of s 22 and s 23 of the MRA(Cth) which specify grounds upon which registration ‘may’ be postponed or refused (respectively). While the use of the word ‘may’ is obviously intended to convey the existence of a discretion to postpone or refuse, rather than a duty to postpone or refuse, if the legislature had intended that the specified grounds be exhaustive of those discretionary powers, one would have expected the word ‘if’ in each of those sections to be followed by the phrase ‘and only if’. The maxim of statutory interpretation known by the Latin expression ‘expressio unius est exclusio alterius’ (the expression of one excludes the others) is not of sufficient strength to compel a different conclusion in this context.
Any other construction would give to the mutual recognition legislation the perverse effect referred to by each of Starke and Dixon JJ in In Re Davis (supra) in that it would require the court of one state to admit to practice any person who had been admitted to practice in any other state or territory, however long ago, notwithstanding that the Court called upon to admit was aware that the person was a lunatic, or a serious criminal or, for some other reason, totally unfit to practise law. The intention to procure such a perverse result should not be attributed to the legislature and is certainly not compelled by either express words or a necessary implication found in the MRA(Cth).”[29]
[29] [2006] WASC 315; (2006) 206 FLR 171 at [63]-[68]; 186-188
22.The Tribunal in Agapis concluded that the Full Court’s reasoning in Tkacz was equally applicable to a statutory licensing authority as it was to the Supreme Court invested with inherent jurisdiction.[30]
[30] [2013] AATA 187 at [15]
THE ANDRIOTIS PROCEEDINGS
23.In AAT Andriotis, the Board had refused to register Mr Andriotis as a waterproofer when he applied for registration under the MR Act. Had he applied for registration under the Building Act, s 170(1)(c) required him to satisfy the Board Tribunal that he was a person of good character. The Board refused his application for registration on the basis that it was not satisfied that he was a person of good character. The Board’s decision was affirmed by the Tribunal.
24.On appeal, the Full Court of the Federal Court set aside the Tribunal’s decision.[31] There were two bases for Court’s judgment. One, expressed by Flick J, was that the MR Act conferred an entitlement on Mr Andriotis to registration in Victoria by reasons of his being registered in a comparable occupation in New South Wales. It was not open to the VBA to rely on s 170(1)(c) of the Building Act. In their joint judgment, Bromberg and Rangiah JJ decided that a quality such as good character is a qualification within the meaning of s 17(2)(b) of the MR Act. Therefore, the mutual recognition principle set out in s 17(1) of the MR Act is not qualified by the requirement in s 170(1)(c) of the Building Act that the person be of good character for that is a law based on the possession of a qualification relating to fitness to carry on the occupation. The Tribunal, and the VBA before it, had been in error in concluding that Mr Andriotis’s application for registration could be refused on the basis of s 170(1)(c).
[31] Andriotis v Victorian Building Authority [2018] FCAFC 24; (2018) 259 FCR 354; 359 ALR 427; 74 AAR 78
25.The High Court dismissed the appeal. Four separate judgments were delivered. Although expressed differently each concluded that s 20(2) of the MRA does not confer any residual discretion in the local registration authority of the second State to refuse registration on any ground other than a ground provided for in the MRA.
INTERPRETATION OF SECTION 35 OF THE MUTUAL RECOGNITION ACT 1992
26.The word “costs” is not defined in the MR Act or in the AAT Act or, indeed, in the other enactments under which the Tribunal may make a costs order.[32] Orders as to costs are frequently made in the Federal and State and Territory courts and the word “costs” has acquired a meaning. In light of that, I have had regard first to what is meant by it in those jurisdictions for the ordinary rules of statutory interpretation are to the effect that:
[32] Administrative Appeals Tribunal Act 1975; s 69B; Safety, Rehabilitation and Compensation Act 1988 (SRC Act); s 67, Military Rehabilitation and Compensation Act 2014 (MRC Act); s 357 and Freedom of Information Act 1982; s 66
“Where words have been used which have acquired a legal meaning it will be taken, prima facie, that the legislature has intended to use them with that meaning unless a contrary intention clearly appears from the context. To use the words of Denman J in R v Slator ((1881) 8 QBD 267 at 272): ‘but it always requires the strong compulsion of other words in an Act to induce the Court to alter the ordinary meaning of a well known legal term’.”[33]
[33] Attorney-General (NSW) v Brewery Employees Union of New South Wales (1908) 6 CLR 469 at 531 per O’Connor J
What is generally understood by “costs”?
27.By way of background, I note that Mr Franks must not engage in legal practice in Victoria, or in Queensland, unless qualified to do so[34] or unless a declaration has been made that he is exempt from that prohibition.[35] Any amount received by an entity in respect of anything done in contravention of s 10(1) may be recovered as a debt by the person who paid it. Similar provisions are in force in Queensland, where Mr Franks carries on business, and New South Wales under the Legal Profession Uniform Law adopted in their States. I am not aware that Mr Franks has a declaration that he is exempt from the prohibition in s 10(1) of Schedule 1 to the Legal Profession Uniform Law and I am also not suggesting that he has breached that prohibition. My reason for mentioning it is that s 10(1) is consistent with the law as it applied generally in Australia before the uniform law was adopted and it puts into context the principles adopted in the authorities, to which I will now refer.
[34] Legal Profession Uniform Law Application Act 2015 (Vic); s 4 and Schedule 1: Legal Profession Uniform Law; s 10(1) and see also Legal Profession Act 2007 (Qld); s 24
[35] Legal Profession Uniform Law; s 10(3)
28.I take, for example, Order 63.01(1) of the Supreme Court (General and Civil Procedure) Rules 2015 (Vic) provides that, unless the context or subject matter otherwise requires “costs includes disbursements and reasonable costs of recording and transcript”. That definition would permit counsel’s or barristers’ fees to be regarded as “costs” for they would be viewed as disbursements.[36]
[36] Lake v Municipal Association of Victoria (No 2) [2018] VSC 660 at [11] per Ginnane J considering a definition in s 3(1) of the Supreme Court Act 1986 (Vic) that “costs” includes “fees, charges and disbursements”.
29.What if the word “costs” is not defined in similar terms? That is the case with the Federal Court Rules 2011, which define the word and related expressions as follows:
“costs, unless the context otherwise provides, means costs as between party and party.
costs as between party and party means only the costs that have been fairly and reasonably incurred by the party in the conduct of the litigation.
costs on an indemnity basis means costs as a complete indemnity against the costs incurred by the party in the proceeding, provided that they do not include any amount shown by the party liable to pay them to have been incurred unreasonably in the interests of the party incurring them.”[37]
[37]Federal Court Rules; Schedule 1, Dictionary Rule 1.51
30.The case of Beach Petroleum NL v Johnson (No. 2)[38] (Beach Petroleum) predates these rules but was decided in the absence of any definition of the word “costs”. There was in the Federal Court Rules in force It is apparent from Beach Petroleum that reference to “costs” includes professional fees paid to legal practitioners and expenses and disbursements including fees paid to witnesses and counsel fees. The case did not raise the issue of fees paid to a person who is not a legal practitioner but who represents another in court proceedings.
[38] [1995] FCA 350; (1995) 57 FCR 119; 135 ALR 160
31.The subject of whether a litigant who is not a lawyer could be paid for the time spent in preparing and conducting a case was touched upon in the judgment of the majority in Cachia v Hanes:[39]
“… The ‘costs’ provided for in the Rules do not include time spent by a litigant who is not a lawyer in preparing and conducting his case. They are confined to money paid or liabilities incurred for professional legal services. It is only in that sense that the Rules speak of ‘costs’.”[40]
The context in which it was touched upon was s76(1) of the Supreme Court Act 1970 (NSW) which conferred a power to award costs in the discretion of the Court. Section 76(1) also gave the Court power to determine by whom and to what extent costs are to be paid and to order that they be ordered to be taxed or otherwise ascertained on a party and party basis or on any other basis. Schedule G to the legislation set out a scale of costs which the majority in Cachia v Hanes found to contain:
“… nothing, apart from its provision for allowances to witnesses, which indicates that the costs for which it provides are otherwise than costs in the conventional sense, namely remuneration for work performed by a solicitor or solicitor’s clerk Indeed, the clear indications are the costs provided for are costs of that kind.”[41]
[39] [1994] HCA 14; (1994) 179 CLR 403; 120 ALR 385; Mason CJ, Brennan, Deane, Dawson and McHugh JJ; Toohey and Gaudron JJ dissenting
[40] [1994] HCA 14; (1994) 179 CLR 403; 12o ALR 385; Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ
[41] [1994] HCA 14; (1994) 179 CLR 403; 12o ALR 385 at 409; 385
32.The majority considered the rationale for limiting costs in this way by looking at the matters, to which a taxing officer was required to have regard under Rule 67(2) of the Supreme Court Rules 1970 (NSW) in deciding whether to allow costs in relation to items not mentioned in Schedule G or of an amount higher than that prescribed in Schedule G.
“… The list of factors in r.67(3) assumes that the costs in the taxing officer's discretion are for work done by a practitioner or practitioner’s employee. Paragraphs (a), (b), (e) and (g) are in their very terms inapplicable to a litigant in person. The other paragraphs might be applied to work done by a litigant in person, but there is no mention of the considerations which might be thought to be central to the taxation of the costs of a litigant in person such as the nature of the work done, the time taken to do it, and the skill with which it was performed.
10. To use the Rules to compensate a litigant in person for time lost would cut across their clear intent. Costs, within the meaning of the Rules, are reimbursement for work done or expenses incurred by a practitioner or practitioner's employee. Compensation for the loss of time of a litigant in person cannot be said to constitute costs within the meaning of the Rules.
11. This is hardly surprising. It has not been doubted since 1278, when the Statute of Gloucester ((4) 6 Edw.I c.1.) introduced the notion of costs to the common law, that costs are awarded by way of indemnity (or, more accurately, partial indemnity) for professional legal costs actually incurred in the conduct of litigation. They were never intended to be comprehensive compensation for any loss suffered by a litigant. As Coke observed of the Statute of Gloucester, the costs which might be awarded to a litigant extended to the legal costs of the suit, ‘but not to the costs and expences of his travell and losse of time’ …”[42]
[42] [1994] HCA 14; (1994) 179 CLR 403; 120 ALR 385 at 410-411; 388 (citations omitted)
33.From a policy perspective, the majority said in Cachia v Hanes, party and party costs have never been regarded as a total indemnity for a successful litigant for costs incurred let alone recompense for work done and time lost by that litigant. They compared the situation of a litigant represented by lawyers and a litigant who is not.
“… Putting to one side the question posed by the relatively rare situation of a solicitor acting in person, there is no inequality involved: all litigants are treated in like manner. And if only litigants in person were recompensed for lost time and trouble, there would be real inequality between litigants in person and litigants who were represented, many of whom would have suffered considerable loss of time and trouble in addition to incurring professional costs. The partial indemnity the law allows represents a compromise between the absence of any provision for costs (which prevails as a matter of policy in some jurisdiction) and full recompense. In these days of burgeoning costs, the risk of which is a real disincentive to litigation, the proper compromise is a matter of both difficulty and concern.”[43]
[43] [1994] HCA 14; (1994) 179 CLR 403; 120 ALR 385 at 414-415; 391
34.The rare situation to which the majority referred in Cachia v Hanes of the solicitor acting in person was introduced by London Scottish Benefit Society v Chorley[44] (Chorley). The essence of the rationale for the conclusion that a successful self-represented solicitor to litigation might recover professional costs is found in the judgment of Brett MR:
““… When, however, we come to the case of a solicitor, the question must be viewed from a different aspect. There are things which a solicitor can do for himself, but also he can employ another solicitor to do them for him; and it would be unadvisable to lay down that he shall not be entitled to ordinary costs if he appears in person, because in that case he would always employ another solicitor. If a solicitor does by his clerk that which might be done by another solicitor, it is a loss of money, and not simply a loss of time, because it is work done by a person who is paid for doing it. It is true, however, to say that the costs of a solicitor appearing in person must be taxed differently from those of an ordinary litigant appearing by a solicitor. The unsuccessful adversary of a solicitor appearing in person cannot be charged for what does not exist, he cannot be charged for the solicitor consulting himself, or instructing himself, or attending upon himself. The true rule seems to be that when a solicitor brings or defends an action in person, he is entitled to the same costs as an ordinary litigant appearing by a solicitor, subject to this restriction, that no costs which are really unnecessary can be recovered. Of this kind are the costs of instructions and attendances. …”[45]
[44] (1884) 13 QBD 872; Brett MR, Bowen and Fry LLJ
[45] (1884) 13 QBD 872 at 875-876
35.The principles were discussed and followed by the High Court in Guss v Veenhuizen.[46] The majority stated that the “… basis is not one of privilege to a solicitor … but is that work done by a solicitor can be quantified on a taxation of costs …”.[47] The minority did not disagree regarding the principle but dissented on whether or not Mr Guss was a person entitled to practise as a legal practitioner in the High Court. As they decided that he was not entitled to practise due to an error by the Court’s Registry, he could not recover solicitor’s fees for his own professional work but he could recover counsel’s fees as they were a disbursement.[48]
[46] [1976] HCA 57; (1976) 136 CLR 47; 12 ALR 271; Gibbs ACJ, Mason, Jacobs, Murphy and Aickin JJ
[47] [1976] HCA 57; (1976) 136 CLR 47; 12 ALR 271 at 52; 275 per Gibbs ACJ, Jacobs and Aickin JJ
[48] [1976] HCA 57; (1976) 136 CLR 47; 12 ALR 271 at 60; 281 per Mason and Murphy JJ
36.The question then arose whether a barrister would be entitled to professional costs when self-represented in litigation. It was answered differently in cases such as Hartford Holdings Pty Ltd v CP (Adelaide) Pty Ltd[49] and Winn v Garland Hawthorn Brahe (Ruling No 1)[50] (Winn) on the one hand and Ada Evans Chambers Pty Ltd v Santisi[51] (Santisi) on the other. In Winn, for example, Kaye J observed the High Court’s view in Cachia v Hanes that the exception stated in Chorley should not be extended. He also drew a distinction between a solicitor’s costs and those of a barrister on the basis that the former are a profit cost and the latter a disbursement. In Santisi, Adamson J considered that it was open to the Magistrate to exercise his discretion to allow the work that Mr Santisi had done as a barrister in the action against him saying that “…The distinction between solicitors and barristers has become less important in circumstances where all legal practitioners are admitted as such. …”.[52]
[49] [2004] SASC 161 at [125] per Doyle CJ
[50] [2007] VSC 360 at [10]-[11] per Kaye J
[51] [2014] NSWSC 538
[52] [2014] NSWSC 538 at [29]
37.The principles in Chorley were revisited by the High Court in Bell Lawyers Pty Ltd v Janet Pentelow.[53] It was decided that the case of Chorley represented an anomaly and should not be extended by judicial decision to barristers or, indeed, to be recognised as part of the common law of Australia.[54] The plurality rejected the premise of Chorley[55] to the effect that professional skills and labour of a legal practitioner can be measured but that of a layman cannot.[56] Edelman J referred to an unrepresented builder, plumber, engineer, architect or accountant who might bring his or her own expertise to perform work in the case. It is absurd to draw a distinction between the solicitor who is a party to litigation and another professional.[57]
[53] [2019] HCA 29; (2019) 93 ALJR 1007; Kiefel CJ, Bell, Gageler, Keane, Nettle, Gordon and Edelman JJ
[54] [2019] HCA 29; (2019) 93 ALJR 1007 at [3]; 1012-1013 per Kiefel, Bell, Keane and Gordon JJ; [63]; 1021-1022 per Gageler; [70] and [79] 1023 and 1025 per Nettle J and [90]-[93]; 1028
[55] Bowen LJ considered Lord Coke’s Commentary 2 Inst. 288 of the Statute of Gloucester 6 Edw, 1, c. 1:[56] [2019] HCA 29; (2019) 93 ALJR 1007 at [24]; 1015
[57] [2019] HCA 29; (2019) 93 ALJR 1007 at [91]-[93]; 1028 Where a party to litigation has in-house lawyers, who appear on its behalf, that party continues to be entitled to recover costs where an ordinary party would be so entitled by way of indemnity. The situation of a sole practitioner employed by an incorporated legal practice of which he or she is sole director and shareholder was expressly set aside by the plurality for consideration on another day: [2019] HCA 29; (2019) 93 ALJR 1007 at [51]-[53]; 1020
38.The High Court has place unrepresented parties on the same footing. Regardless of their profession, they cannot claim for their own time or loss of remuneration. The High Court did not disturb the basic common law understanding that costs include professional fees paid to legal practitioners and expenses and disbursements including fees paid to witnesses and counsel fees.
How does a court exercise its discretion to make a costs order?
A. General principles
39.The principles underpinning a decision whether to make such an order or not have been considered in a number of authorities. I will begin with Australian Securities Commission v Aust-Home Investments Limited,[58] in which Hill J summarised a number of propositions that he found supported by the authorities:
“(1) Where neither party desires to proceed with litigation the Court should be ready to facilitate the conclusion of the proceedings by making a cost order: Stratford [JT Stratford & Son Ltd v Lindley (No 2)[59]] and the SEQB case [Re South East Queensland Electricity Board v Australian Telecommunications Commission[60]].
(2)It will rarely, if ever, be appropriate, where there has been no trial on the merits, for a Court determining how the costs of the proceeding should be borne to endeavour to determine for itself the case on the merits or, as it might be put, to determine the outcome of a hypothetical trial: Stratford supra. This will particularly be the case where a trial on the merits would involve complex factual matters where credit could be an issue.
(3)In determining the question of costs it would be appropriate, however, for the Court to determine whether the applicant acted reasonably in commencing the proceedings and whether the respondent acted reasonably in defending them (SEQB).
(4)In a particular case it might be appropriate for the Court in its discretion to consider the conduct of the respondent prior to the commencement of the proceedings where such conduct may have precipitated the litigation: Sunday Times Newspaper Co Ltd v McIntosh (1933) 33 SR (NSW) 371.
(5)Where the proceedings terminate after interlocutory relief has been granted, the court may take into account the fact that that interlocutory relief has been granted: cf Re Asiatic Electric Co Pty Ltd (in liq) [1973] 1 NSWLR 603 at 606, a case which, however, depended upon the specific wording of the statute under consideration.”[61]
[58] [1993] FCA 585; (1993) 44 FCR 194; 116 ALR 523; 11 ACSR 136
[59] [1969] 1 WLR 1547; [1969] 3 All ER 1122
[60] [1989] FCA 15
[61] [1993] FCA 585; (1993) 44 FCR 194; 116 ALR 523; 11 ACSR 136 at 201; 530; 143
40.In Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin,[62] Ms Lai Qin had instituted proceedings in the High Court against the Minister for Immigration and Ethnic Affairs (Minister) and the Refugee Review Tribunal to show cause why writs of prohibition, certiorari and mandamus should not be issued against them on the ground that the tribunal had misconstrued or exceeded its jurisdiction in affirming the Minister’s decision to refuse to grant her a protection visa. Seven days later, the Minister granted her a protection visa. Ms Lai Qin did not proceed with her action but did seek an order that the Minister pay the costs of proceedings she had instituted. Order 71, r 39 of the Rules of Court of the High Court provides that the Court or a Justice might “make such order as is just” when the further prosecution of a proceeding becomes unnecessary.
[62] 186 CLR 622; (1997) 143 ALR 1
41.McHugh J set out the principles that govern an application for costs when a party elects not to pursue an action because he or she has achieved the relief sought in the action either by settlement or by extra-curial means.
“ In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs …. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order …. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order.
In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action …. In administrative law matters, for example, it may appear that the defendant has acted unreasonably in exercising or refusing to exercise a power and that the plaintiff had no reasonable alternative but to commence a litigation. Thus, for example, in R v Gold Coast City Council; Ex parte Raysun Pty Ltd …, the Full Court of the Supreme Court of Queensland gave a prosecutor seeking mandamus the costs of the proceedings up to the date when the respondent council notified the prosecutor that it would give the prosecutor the relief that it sought. The Full Court said that the prosecutor had reasonable ground for complaint in respect of the attitude taken by the respondent in failing to consider the application by the prosecutor for approval of road and drainage plans.
Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. This is perhaps the best explanation of the unreported decision of Pincus J in The South East Queensland Electricity Board v Australian Telecommunications Commission … where his Honour ordered the respondent to pay 80 per cent of the applicant's taxed costs even though his Honour found that both parties had acted reasonably in respect of the litigation. But such cases are likely to be rare.
If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases ….”.[63]
[63] 186 CLR 622; (1997) 143 ALR 1 at 3-4
42.In Yates Property Corporation Pty Ltd v Boland,[64] Goldberg J had concluded that the conduct of both parties had been reasonable in relation to the application. It was open to him, he said, to determine the costs issues by reference to what is reasonable but Goldberg J chose to proceed by reference to the judgment he would have come to had the proceedings not been rendered of no consequence by a judgment of the High Court. That judgment had been delivered after his Honour had heard the applications and before he had delivered judgment. He indicated that his reasons were well advanced at that time and that he had been in a position to determine what the outcome would have been. His conclusion regarding the outcome led him to make an order that costs followed the event.
[64] [2000] FCA 1106; (2000) 179 ALR 664
43.The approach taken by Goldberg J led him to the traditional view taken when formal judgment has been given that costs follow the event and are awarded to the successful party. What amounts to “success”, however, may not always be that which is apparent from the final judgment. This was explored by the Full Court of the Federal Court in Umoona Tjutagku Health Service Aboriginal Corporation v Walsh[65] in the context of the Court’s power under s 43 of the Federal Court of Australia Act 1976 when they said:
[65] [2019] FCAFC 32; White, Perry and Banks-Smith JJ
“ Thus, while the ordinary rule is that the successful party will receive her or his costs, that is not an absolute rule: Oshlack [Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72] at [40] (Gaudron and Gummow JJ); Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 (Ruddock) at 234-235 (Black CJ and French J). As the Full Court explained in Queensland North Australia Pty Ltd v Takeovers Panel (No 2) [2015] FCAFC 128; (2015) 236 FCR 370 at [11], after referring to the decisions in Ruddock and Victoria v Sportsbet Pty Ltd (No 2) [2012] FCAFC 174 with approval:
11. These decisions treat the success or failure of the relevant party as being the starting point in consideration of the question of costs. However they contemplate at least three distinct categories of situation in which a successful party might be deprived of costs, or even ordered to pay the costs of the other side. One such category is where the applicant has been only partially successful in that it has not obtained all of the relief sought. The second category is where a party has succeeded in obtaining the relief sought, but has not succeeded on all bases (factual or legal) upon which it sought such relief. Of course, it is possible that a particular outcome will fall into both categories. A third category involves consideration of the successful party’s conduct of the case.
As this passage explains, in determining whether to apply the ordinary rule, the Court may have regard not merely to the extent of success vis a vis different causes of action, but also to the extent of success vis a vis different factual and legal issues. The appellants’ submission to the contrary must therefore be rejected.
To put it another way, it is correct to say that what amounts to success is not always revealed merely by reading the orders of the court. As the Western Australian Court of Appeal explained in Frigger v Professional Services of Australia Pty Ltd (No 2) [2011] WASCA 103 (S) (Frigger):
12 ... Where an appellant has been successful in obtaining what is, in effect, a variation in their favour of orders below, there may remain valid reasons to not award costs in favour of the appellant where the appellant has not been successful in the underlying, real contest: Laws v Australian Broadcasting Tribunal (1989) ALD 522; (1989) 85 ALR 659, 677. Where appellants have only won a nominal victory then the court may not award costs. Success in proceedings is to be determined by the ‘reality’ of the circumstances involved: Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 [70] (McHugh J); Alltrans Express Ltd v CVA Holdings Ltd [1984] 1 WLR 394, 401.
The breadth of the discretion as to costs is reflected among other things in s 43(3)(c) and (e) of the FCA Act which respectively permit the Court to make orders that the parties bear costs in specified proportions and to award costs in favour of or against a party irrespective of whether the party is successful in the proceeding: see also Oshlack at [40]. Thus, as the High Court held in Gray v Richards (No 2) [2014] HCA 47; (2014) 89 ALJR 113:
2. The disposition of costs is within the general discretion of the Court. Ordinarily, that discretion will be exercised so that costs are awarded to the successful party, but other factors may have a significant claim on the discretion of the Court. The disposition which is ultimately to be made in any case where there are competing considerations will reflect a broad evaluative judgment of what justice requires.
(emphasis added; citations omitted)
The interests of justice include considerations of the cost-effectiveness of litigation. Thus a court may conclude that a departure from the general rule is warranted where substantial issues are raised by the successful party which unduly extend the time and expense of litigation: A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27 at [6]- [11] (the Court). As counsel for Ms Walsh pointed out, the relevance of such considerations is highlighted by the obligation imposed upon a party and a party’s lawyer by subss 37N(1) and (2) respectively of the FCA Act to conduct proceedings in a way that is consistent with the overarching purpose in s 37M, namely, to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible.”[66]
[66] [2019] FCAFC 32 at [42]-[46]
44.A note of warning was sounded by Toohey J in Re Hughes and Western Australian Cricket
Association:[67]
“ There is no difficulty in stating the principles; their application to the facts of a particular case is not always easy. Also it is necessary to keep in mind the caveat by Jacobs J. in Cretazzo v. Lombardi [(1975) 13 SASR 4] at 16. His Honour sounded what he described as ‘a note of cautious disapproval’ of applications to apportion costs according to the success or failure of one party or the other on the various issues of fact or law which arise in the course of a trial. His Honour commented:
‘But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues’.’[68]
[67] [1986] FCA 382
[68] [1986] FCA 382 at [10] The need to analyse the whole of the progress of the case is illustrated by Site Skills Group Pty Ltd v Administrative Appeals Tribunal (No 2) [2020] FCA 78; Reeves J
B.Principles relevant to taxation of party and party and of indemnity costs
45.In Beach Petroleum, judgment had been entered against ten respondents. Some were ordered to pay the applicant’s costs on a party and party basis and another on an indemnity (or solicitor and client) basis. In His Honour addressed the basis on which costs are taxed when ordered on an indemnity basis:
“…Where a court makes an order for costs on an indemnity basis against a party, the court may tax the costs so awarded according to a time cost agreement between the successful party and his solicitor unless the taxing officer considers that in all the circumstances it would be unreasonable to do so: Singleton v Macquarie Broadcasting Holdings Ltd (1991) 24 NSWLR 103 at 105, 115. In the present case the indemnity costs sought against Enterprise and Jingellic are based on time costs.
This Court has held that a party awarded costs on an indemnity basis is entitled to all the costs he or she has incurred except those costs that are unreasonable in amount or have been unreasonably incurred: see Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 401 and Ragata Developments Pty Ltd v Westpac Banking Corporation (unreported, Federal Court, Davies J, 5 March 1993). See also Singleton v Macquarie Broadcasting Holdings Ltd at 107.
… The disbursements are very high, reflecting large fees paid to
expert witnesses, to overseas witnesses, for travel and accommodation, for
photostating (in excess of 2 million pages), for professional fees paid to
overseas and interstate lawyers in connection with investigations and in
answering subpoenas, and for counsel fees. …
…
In the usual case the party and party costs are significantly lower than the indemnity or actual costs.”[69]
[69] [1995] FCA 350; (1995) 57 FCR 119; 135 ALR 160 at 121-122; 163-164
46.In the circumstances of the case before him, von Doussa J discussed the principles for determining indemnity costs:
“The starting point for fixing the gross fee for indemnity costs must be the
charges rendered to the applicants by their solicitors. But as Mr Norman
acknowledges in his affidavit, however carefully a complex bill is drawn there are likely to be items taxed off. Mr Rice has detected some items that have been included in error. Even though there is no statutory obligation on a judge to discount figures provided by the successful party on a ‘fail safe’ basis, it is acknowledged in Leary v Leary at 76; 265 that there may well be occasions on which a judge will make such a discount. In my opinion this is a case where
......................[sgd].................................................
Associate
Date of decision: 2 June 2020
Heard on the papers: 5 February 2020 Applicant’s advocate: Mr Richard Franks
Solutio Australia Pty LtdRespondent’s solicitor: Ms Louise Riley and Ms Miriam Fletcher
Victorian Building Authority
Measures) Act 2017 (Vic) No. 21 of 2017.
“… His meaning seems to be that only legal costs which the Court can measure are to be allowed, and that such legal costs are to be treated as expenses necessarily arising from the litigation and necessarily caused by the course which it takes. Professional skill and labour are recognised and can be measured by the law; private expenditure of labour and trouble by a layman cannot be measured. It depends on the zeal, the assiduity, or the nervousness of the individual. Professional skill, when it is bestowed, is accordingly allowed for in taxing a bill of costs; and it would be absurd to permit a solicitor to charge for the same work when it is done by another solicitor, and not to permit him to charge for it when it is done by his own clerk. …”: (1884) 13 QBD 872 at 877
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