Briner v The Happy Herb Company and Ors (No.2)
[2017] FCCA 2844
•30 November 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| BRINER v THE HAPPY HERB COMPANY & ORS (No.2) | [2017] FCCA 2844 |
| Catchwords: PRACTICE & PROCEDURE – COSTS – Claim for indemnity or party/party costs – application of the Federal Circuit Court scale of costs. |
| Legislation: Federal Circuit Court Rules 2001 (Cth) |
| Cases cited: Briner v The Happy Herb Company & Ors [2017] FCCA 1854 |
| Applicant: | MIKE BRINER |
| First Respondent: | THE HAPPY HERB COMPANY |
| Second Respondent: | RAYMOND WALTER THORPE |
| Third Respondent: | ELIZABETH EILEEN RIX |
| File Number: | SYG 2252 of 2016 |
| Judgment of: | Judge Driver |
| Hearing date: | Decided on the papers |
| Date of Last Submission: | 26 October 2017 |
| Delivered at: | Sydney |
| Delivered on: | 30 November 2017 |
REPRESENTATION
| Counsel for the Applicant: | Ms R White |
| Solicitors for the Applicant: | Banki Haddock Fiora |
| The First and Second Respondents appeared in person |
ORDERS
The first and second respondents shall pay the applicant’s costs and disbursements of and incidental to the proceedings, fixed in the amount of $16,855.65.
The third respondent, Elizabeth Eileen Rix, is removed as a respondent to the application.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2252 of 2016
| MIKE BRINER |
Applicant
And
| THE HAPPY HERB COMPANY |
First Respondent
RAYMOND WALTER THORPE
Second Respondent
ELIZABETH EILEEN RIX
Third Respondent
REASONS FOR JUDGMENT
By Application in a Case filed on 13 October 2017, the successful applicant in the principal proceedings (Mr Briner) seeks orders for costs on four alternative bases:
a)$65,170.12 on an indemnity basis;
b)in the alternative $62,771.62, being the amount determined under the Federal Circuit Court scale of costs until 1 December 2016 ($3,181) and thereafter on an indemnity basis ($59.590.62);
c)in the alternative, $47,284.12, being the amount determined under the Federal Circuit Court scale until 29 May 2017 ($6,209) and thereafter on an indemnity basis ($41,075.12);
d)in the alternative, $24,113.12 on the Federal Circuit Court scale.
This Application in a Case followed my judgment in the principal proceedings.[1] The orders in the principal proceedings were:
1. Pursuant to s.115(2) of the Copyright Act 1968 (Cth), the first and second respondents are to pay compensatory damages to the applicant in the sum of AUD$500 within 28 days.
2. Pursuant to s.115(4) of the Copyright Act, the first and second respondents are to pay additional damages to the applicant in the sum of AUD$1,000 within 28 days.
[1] Briner v The Happy Herb Company & Ors [2017] FCCA 1854
In delivering my principal judgment, I encouraged the parties to negotiate the question of costs, having regard, among other things, to the modest award of compensation made. I anticipated that Mr Briner’s legal costs would be substantial, especially when compared to the compensation award.
The parties were unable to agree on the question of costs but they agreed to me making orders in chambers on 10 October 2017 to put in place a process for dealing with costs on the papers. The parties have adhered to that process.
The Application in a Case is supported by the affidavit of Mr Briner’s solicitor, William Peter Knight, made on 11 October 2017. That affidavit provides a chronology of the dealings between the parties up to the trial of the matter.
In submissions filed on 13 October 2017, Mr Briner contends that the respondents have, in effect, maintained a recalcitrant position in relation to the claim for compensation, rejected or failed to respond to reasonable offers of compromise and apparently failed to seek legal advice, notwithstanding that they were invited to do so. Mr Briner maintains that he is entitled to indemnity costs, having regard to the offers made and the recalcitrant attitude of the respondents, but alternatively submits that costs be assessed on a party and party basis in accordance with the Federal Circuit Court scale.
The respondents rely upon the affidavits of Raymond Thorpe and Laura Stapleton made on 19 and 26 October 2017. In those affidavits, Mr Thorpe and Ms Stapleton analyse my judgment in some detail. Both affidavits are essentially submissions and put the proposition that no costs should be awarded because of the manner in which the proceedings were conducted by those representing Mr Briner, and on the basis of the intrinsic value of the work in issue. The submissions are reiterated in an outline of submissions filed on 27 October 2017 on behalf of the respondents.
In my opinion, Mr Briner should receive an award of costs but it should be less than the various amounts sought.
An indemnity costs award cannot be justified. The settlement offers put forward as supporting the application for indemnity costs were all substantially in excess of the compensation ultimately awarded by the Court. The respondents were entitled not to accept either of those offers. Further, as noted in my principal judgment, the original licence fee sought on 15 October 2015 of USD$1,180 included a substantial amount for an asserted breach of moral rights, on which Mr Briner ultimately did not succeed. It is true that a further offer to settle of AUD$1,115 was made on 29 October 2015 but that was well in advance of the institution of legal proceedings, and, at the time, the respondents were not in possession of information verifying the legitimacy of the claim.
It is unfortunate that this matter was not resolved at the mediation held on 7 April 2017. As I noted in my principal judgment, with a little more goodwill on both sides, the matter could have (and in my view, should have) been resolved for a sum similar to that ultimately awarded by the Court.
Following the failure of the mediation, Mr Briner had little option but to pursue the matter to trial. By the time the matter got to trial, there was no serious contest over any of the issues in the case, other than the amount of compensation that should be paid. Although not legally represented, the respondents must have known that Mr Briner’s claim to some compensation was legitimate and they were at risk in the legal proceedings. The respondents still maintain the view that Mr Briner is entitled to very little and, somewhat surprisingly, appear still to be contesting the issue of compensation that was resolved by my principal judgment.
The above considerations persuade me that costs should follow the event in this case. However, the costs should be assessed in accordance with the scale in the Federal Circuit Court Rules 2001 (Cth) following the date of the failed mediation. I will not allow any amount for costs up to and including the mediation. It follows that Mr Briner will receive his costs pursuant to the Court scale for preparation for final hearing for a one day matter ($6,493) and attendance at the hearing ($2,162) and to take judgment and explain orders ($294). He will also receive the daily hearing fee for the directions hearing following the mediation ($294). I will not allow the travelling allowance sought on behalf of Mr Briner, as his legal representative readily agreed to the conduct of the trial in Brisbane (which was the more convenient forum for witnesses) rather than in Sydney. That produces a costs outcome figure of $9,243. I will in addition allow the disbursements claimed for counsel’s professional fees of $4,795 and other disbursements incurred following the mediation of $2,082.65 plus the Court setting down fee of $735.
This produces a total figure of $16,855.65. The costs should be borne by the first and second respondents only. The third respondent (Ms Rix) has taken no part in these proceedings and I have reason to doubt her knowledge and understanding of them. I indicated at the trial of the matter that I was minded to remove Ms Rix as a respondent and I will now make that order.
I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of Judge Driver
Date: 30 November 2017
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