Australian Competition and Consumer Commission v Black on White Pty Ltd

[2004] FCA 454

FEDERAL COURT OF AUSTRALIA

Australian Competition & Consumer Commission v Black on White Pty Ltd  [2004] FCA 454

COSTS – ordinary costs to follow the event – whether exceptional circumstances exist

Federal Court of Australia Act 1976 (Cth) s 43
Trade Practices Act 1974 (Cth)
Bankruptcy Act 1966 (Cth)
Federal Court Rules O 35 r 7

Hughes v Western Australian Cricket Association (Inc.) (1986) ATPR 40-748 cited
Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 referred to

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v BLACK ON WHITE PTY LTD (ACN 061 507 248) and OTHERS

No QG 110 of 1997

SPENDER J
BRISBANE
21 APRIL 2004

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QG 110 OF 1997

BETWEEN:

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
APPLICANT

AND:

BLACK ON WHITE PTY LTD (ACN 061 507 248)
FIRST RESPONDENT

NICKI POTERI
SECOND RESPONDENT

JAMES NICHOLAS POTERI
THIRD RESPONDENT

NICHOLAS JAMES POTERI
FOURTH RESPONDENT

JUDGE:

SPENDER J

DATE OF ORDER:

21 APRIL 2004

WHERE MADE:

BRISBANE

THE COURT ORDERS THAT:

The third respondent pay the costs of the Australian Competition and Consumer Commission of and incidental to the amended motion filed by him on 21 July 2003, those costs to be taxed if not agreed.

Note:   Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QG 110 OF 1997

BETWEEN:

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
APPLICANT

AND:

BLACK ON WHITE PTY LTD (ACN 061 507 248)
FIRST RESPONDENT

NICKI POTERI
SECOND RESPONDENT

JAMES NICHOLAS POTERI
THIRD RESPONDENT

NICHOLAS JAMES POTERI
FOURTH RESPONDENT

JUDGE:	SPENDER J
DATE:	21 APRIL 2004
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. On 31 March 2004 I refused relief sought by James Nicholas Poteri in an amended notice of motion filed by him on 21 July 2003.  By that motion, Mr Poteri sought a declaration that he was not liable to pay any of the amounts referred to orders of the Court dated 4 April 2001, 22 November 2001, 12 June 2002, 22 October 2002 and 24 February 2003.  For the reasons I there expressed, I held that none of those amounts was a debt provable in his bankruptcy, and it followed that he was therefore not released from his obligations to pay those amounts on his discharge from bankruptcy.

2. At the request of the applicant on the motion, I directed that the applicant on the motion file and serve written submissions by 4 pm Monday 5 April 2004 as to why costs should not follow the ordinary course, and that the respondents file and serve submissions in reply on the question of costs by 4 pm Thursday 8 April 2004.

3. The submissions on behalf of Mr Poteri acknowledge that the power to award costs pursuant to s 43 of the Federal Court of Australia Act 1976 (Cth) is wide, and that in the absence of special circumstances costs should follow the event: Hughes v Western Australian Cricket Association (Inc.) (1986) ATPR 40-748 at 48,136. Of course, there may be circumstances where a different result from the usual course can be justified in the exercise of the judicial discretion as to costs.

4. It was submitted on behalf of Mr Poteri that there were special circumstances in this case.  The submissions went so far as to suggest that Mr Poteri should not have to pay or bear any of the costs of the applicant in the previous proceeding.  That was part of the relief sought in the amended notice of motion which was dismissed.  There was no appeal against the making of the costs order in the principal proceedings, and in my view the Court has no power to set aside those previous orders.  In particular, it has no power to set aside the costs orders in reliance on O 35 r 7 of the Federal Court Rules.  As I noted in the earlier reasons, Sir Anthony Mason said of a similar jurisdiction in Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 303:

   ‘The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to re-argue their cases.’

5. As to the submissions directed as to why, notwithstanding Mr Poteri’s failure on his amended notice of motion he should not be ordered to pay the costs of the respondent to that motion, it was submitted on his behalf that where the general principles that were involved were very much a matter of concern to the Government, the Court may order the Government, represented here by the Australian Competition and Consumer Commission (“the ACCC”), to bear its own costs. 

6. It was further submitted that where the matter involves matters of public interest the Court may decline to order costs against someone such as Mr Poteri.  It was said that the litigation involved a relatively small amount of money; the action was conducted by the ACCC on behalf of, or in respect of, a number of other individuals; the matter concerned an application by the ACCC under the Trade Practices Act 1974 (Cth) and the issues on the amended notice of motion involved the question of what were provable debts under the Bankruptcy Act 1966 (Cth). For these reasons it was submitted that Mr Poteri should not be ordered to pay the costs of the ACCC in respect of the motion.

7. In my judgment, none of the circumstances said to constitute exceptional circumstances properly falls into that category.  The contention on behalf of Mr Poteri that the sums he was ordered to pay constituted provable debts in his bankruptcy was found to be untenable.  There is, in my view, no reason why the usual costs order should not be made.  In all the circumstances it is appropriate that Mr Poteri pay the costs of and incidental to his motion to the ACCC.  I so order.

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender .

Associate:

Dated:             21 April 2004

Counsel for the Applicant:

Mr Stephen Lumb

Solicitor for the Applicant:

Australian Government Solicitor

Counsel for the Respondent:

Mr Brian Kelleher

Date of Submissions of Applicant:
Date of Submissions of Respondent:

1 April 2004

7 April 2004

Date of Judgment:

21 April 2004