CDC Clinics Pty Ltd v Coleman
[2022] VSC 464
•18 August 2022
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2021 03832
| CDC CLINICS PTY LTD (ACN 109 209 921) | Appellant |
| v | |
| SUSAN COLEMAN | Respondent |
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JUDGE: | GARDE J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 19 July 2022 |
DATE OF JUDGMENT: | 18 August 2022 |
CASE MAY BE CITED AS: | CDC Clinics Pty Ltd v Coleman |
MEDIUM NEUTRAL CITATION: | [2022] VSC 464 |
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PRACTICE AND PROCEDURE – COSTS – Award of costs in summary criminal proceedings in the Magistrates’ Court – Whether prosecution was successful – Whether costs order in favour of prosecution for dismissed or withdrawn charges was unreasonable or unjust – Whether reasons for decision were adequate – Whether discretion miscarried – Criminal Procedure Act 2009 (Vic) ss 401(1), (2); Latoudis v Casey (1990) 170 CLR 534 considered.
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APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr R O’Neill | Michael V Stapleton |
| For the Respondent | Mr K McDonald | Russell Kennedy |
HIS HONOUR:
Introduction
On 20 September 2021, the appellant, CDC Clinics Pty Ltd (ACN 109 209 921), was convicted of four charges of carrying on an unregistered health service establishment contrary to s 111(a) of the Health Services Act 1988 (Vic). The charges related to cosmetic surgery conducted by the appellant at premises in Armadale. The respondent was, at the relevant times, an officer of the Department of Health and Human Services and acted as the informant.
The appellant was convicted on four charges and fined $9,000 on each charge. The appellant was also ordered to pay the respondent’s costs fixed at $75,000. This appeal relates solely to the costs order made by the magistrate. There is no appeal against the convictions or the fines which were imposed.
In September 2019, the respondent issued ten charges against the appellant, nine alleging the carrying on of an unregistered health service establishment on dates between 2 October 2018 and 24 January 2019, and the other alleging the same over the period from about 2 October 2018 until about 30 April 2019. An additional charge was issued on 18 December 2019 alleging a similar offence, which was said to have occurred on or about 16 February 2019.
The appellant pleaded not guilty to all charges.
The charges were heard via Webex over six days between 1 March 2021 and 28 June 2021. The magistrate delivered judgment on 24 August 2021 and found charges 1, 3, 7, 9 and 10 proven. Charge 10 was considered by the magistrate to be an alternative to the proven charges and was struck out or withdrawn. Charges 2, 4, 5 and 6 were dismissed, and charges 8 and 11 had been withdrawn by the prosecution.
On 20 September 2021, the parties made submissions to the magistrate on penalty and costs, and the magistrate determined the orders which he proposed to make. The magistrate’s decisions on costs were made in the course of the hearing.
Grounds of appeal
In its amended notice of appeal filed 20 July 2022, the appellant relied on four grounds of appeal:
1. The magistrate erred in law in that he awarded the costs of the entire proceeding on a wrong principle, that being that the informant was entitled to such an order even where only some charges are proven.
2. The magistrate erred in law in that his exercise of discretion awarding the costs of the entire proceeding to the informant, and refusing the defence the costs of the unsuccessful charges, was unreasonable and plainly unjust.
3. The magistrate erred in law in holding that the appellant was not a ‘successful defendant’ in relation to the charges which were withdrawn or dismissed and on that basis refusing the appellant’s application to be awarded the costs of those charges.
4. The magistrate erred in law in holding that the informant was the successful party in the proceedings and on that basis awarding the informant the costs of the proceeding as a whole.
All of the grounds relate to the same costs issue. It is convenient to consider them together.
Evidence
The appellant relies on the affidavits and their exhibits of its solicitor, Michael Stapleton, filed 22 October 2021, 6 December 2021, 22 March 2022, 20 July 2022 and 25 July 2022. The respondent relies on the affidavit and its exhibits of her solicitor, Kylie Walsh, filed 11 February 2022. The parties made a number of corrections to the transcript of proceedings in the Magistrates’ Court on 20 September 2021 (‘transcript’). There are numerous instances where the transcript shows that the speakers were inaudible or unintelligible, although none of these instances appear to be critical to the determination of this proceeding.
The hearing on 20 September 2021
The hearing on 20 September 2021 concerned the penalties which were to be imposed by the magistrate and the costs orders to be made. The two issues were interwoven in the submissions of counsel and the observations of the magistrate. I will endeavour to extract the parts of the transcript which are significant to, or lead up to, the oral decision of the magistrate as to costs:
Magistrate:But when it comes to the issue of costs, I’m often conscious of the fact that I have to have a look at the global amount being paid out by an accused after a finding of guilty. You might wish to address me on whether or not I ought to take into account when assessing the level of the fines, the level of costs that will be awarded against the accused …
Appellant’s counsel (‘AC’): … I certainly would be first of all resisting the making of an order for costs, and in the alternative, if Your Honour, were [inaudible] to make such an order, adopting what Your Honour has suggested in terms of that having a moderating effect on the penalty. Particularly as, Your Honour, the costs claimed are a significant amount.
…
Magistrate: What [are] the costs claimed at the [moment] …?
Respondent’s counsel (‘RC’): There haven’t been negotiations, Your Honour. We’ve given our friends a copy of the total costs, so the total that the prosecution seeks is $128,994.99. The breakdown of that is [$59,180.30] is direct cost for the solicitors and disbursements, $69,814.69.
Magistrate: That’s [$69,000] solicitors fees?
RC: [$59,000] of solicitors fees, and [$69,000 odd] disbursements.
Magistrate:Okay. Thank you very much. Well, that’s a very significant figure. I would be [minded] to think that given that it’s so large, I would have to take that into account should that order be made. The other issue of course is … that even in criminal matters, costs usually follow the event, and there would have to be good reason why I wouldn’t order costs. Ordinarily I would say the prosecution are entitled to them.
AC:Well, if your Honour wants to hear [from me] on that point. Firstly, the event in my respectful submission is 11 charges that were brought, not four on which Your Honour eventually found the accused guilty. The accused has had success on more than half the charges …
Nevertheless, the accused has been put through the costs of defending six unsuccessful charges, and in the alternative to [no order as to costs] we would seek an order for the costs of those charges …
So in my submission, the overall justice of the case would be served by there being no orders [as to costs], but if Your Honour were against me on that, then they should be very significantly discounted from the amount claimed in this document.
…
Magistrate:I am minded toward costs … I’ll give my reasons for that later, but I do tend to think that it’s only the costs of prosecution that can be properly awarded, not the costs of the investigation.
So, anything that’s done prior to issue I do not think can be claimed.
…
AC:Your [Honour], can I just make this a submission so that it’s [at least] on the record that it was made. In my submission, if your [Honour] is beginning from a position that because the prosecution had some success that entitles them … obviously your [Honour] will still … exercise discretion, but that creates the [prima facie] position that they’re entitled to their costs … That would be an error. And the parallel between civil cases where a plaintiff is successful in a smaller amount than they claim, is not the law in a criminal case … Most published decisions on costs in summary and committal proceedings consider the case of a wholly successful accused, where the accused is convicted on some charges. The general rule that a successful accused should receive his or her costs does not apply… Just one more thing. Just so it’s on the record, my primary position, therefore, is that I want to be on record that there is an order, an application for an order of the accused costs of the charges on which it was acquitted, albeit that, that the accused primary position is that there should be no orders to costs.
Magistrate:Okay. Thanks very much … I have been looking at paragraph 19 of [Costa v Parks [2008] VSC 47] where [Habersberger J] didn’t accept the submission of Mr [Trood] of counsel … dealing [with] the case … in South Australia [of Saleeba v Beck (1991) 54 A Crim R 114].
AC: [Saleeba]. Yes, your [Honour].
Magistrate:Yeah. Where an accused was [acquitted] of some charges and convicted of the others, and the proposition put forward … was [that] the [costs] should be reduced accordingly, or not [ordered]. And he didn’t agree with that.
AC:Yes, your [Honour]. But he didn’t order costs in favour of the prosecution. In that case … it was [a] case of either the accused got costs or nobody got costs.
…
Magistrate:But, but let me understand what you’re saying … You are saying that I should be ordering the prosecution, pay your client’s [costs] in relation to the charges that were not successful.
AC:… that is an application that I make, but my primary position is that it should all come out in the [wash] effectively and that your [Honour] should simply make no orders [as] to [costs]. But if your [Honour] considers otherwise, then yes, the application is that we [get] our costs of the charges on which we were successful and the prosecution get their costs of [charges] on which they were successful. And given … the complexity of that, I’d be submitting that your [Honour] should send it for either taxation or agreement if your [Honour] was with me …
Magistrate:All right. Thank you very much. Well, look, I’d like to read the [case] you have sent in and just consider it a little bit further …
[Adjournment]
Magistrate:Now look, I’ve been considering … I read the cases, thank you, and I read the materials you referred me to … I’m in two minds about which way to go. If I might say quite frankly, I’m not with you, [AC], with the notion that the accused is a successful defendant. Insofar at least, as that was outlined by [Justice O’Bryan in Do v Bowers (Supreme Court of Victoria, O’Bryan J, 10 October 1996)]. I do not think the defendant has been successful, I think the prosecution have …
[T]he amount sought here is very large. I would be minded if I’m engaging in some sort of self-help costing, to ask $75,000 by way of legal fees. I’m happy to consider more, if you wish to address me in relation to [counsel’s] fees. That is, I certainly don’t want to award less than what [counsel’s fees] amount to, and I of course always have [regard] to the fact that the prosecution agency, of course, is performing a regulatory function. Doesn’t mean that it’s not entitled to its costs, when successful, providing other matters don’t come in to dissuade me from doing so. But as far as the considerations in [Latoudis v Casey] go, I don’t think anything is raised that robs the prosecution of their costs in relation to this matter.
…
Magistrate:Now on the issue of costs, we’ve already discussed this a bit at length, but I’ll just repeat my previous conclusion that I do not consider the accused to have been a successful defendant as per the decision of [O’Bryan J] that we’ve … discussed previously. A number of charges were laid against the accused, not all were made out, but quite a number were. They weren’t proved with respect to each and every element that was alleged, but nevertheless, the charges were carrying on a business when not registered to do so. And that charge was amply made out.
I’ve already indicated that, [in relation to AC’s] argument that the accused [has] been partially successful on a number of charges which were dismissed, and therefore is deserving of costs, I disagree with that for the reasons that I’ve stated earlier.
Appellant’s submissions
The appellant submitted that:
(a) in ordinary circumstances, a successful defendant is entitled to an order for costs;
(b) the appellant was a successful defendant in relation to six charges out of the eleven charges brought by the respondent;
(c) the respondent was awarded the costs of the entire proceeding;
(d) there was no disentitling conduct or reason to deprive the appellant of its costs of the charges which it successfully defended;
(e) the magistrate provided very little reasoning for the conclusion that the prosecution was the successful party;
(f) the magistrate misunderstood the authorities cited to him; and
(g) the exercise of the magistrate’s discretion as to costs miscarried.
Respondent’s submissions
The respondent contended in its written submissions that the magistrate did not award the costs of the entire proceeding to the prosecution.
The respondent further submitted that:
(a) the magistrate was entitled to take a global approach to the award of costs;
(b) the fact that the appellant was successful on five charges does not mean that the magistrate was obliged to order costs in its favour, or could not decide to order costs in favour of the prosecution;
(c) the course taken by the magistrate was open to him in the exercise of his broad discretion;
(d) the costs incurred in responding to the charges successfully brought by the prosecution were the same costs which were incurred defending the charges on which the appellant was unsuccessful;
(e) it was open to the magistrate in exercising his discretion as to costs to award the prosecution its entire costs of the proceeding and not to award the defence the costs of resisting the unsuccessful charges; and
(f) there is nothing to show that the magistrate’s discretion miscarried.
Relevant statutory provision
Sections 401(1) and (2) of the Criminal Procedure Act 2009 (Vic) (‘Act’) provide:
(1)Unless otherwise expressly provided by this or any other Act or by the rules of court, the costs of, and incidental to, all criminal proceedings in the Magistrates’ Court are in the discretion of the court and the court has full power to determine by whom, to whom and to what extent the costs are to be paid.
(2)In exercising its discretion under subsection (1) in a criminal proceeding, the Magistrates’ Court may take into account any unreasonable act or omission by, or on behalf of, a party to the proceeding that the court is satisfied resulted in prolonging the proceeding.
Authority
In Latoudis v Casey,[1] the High Court delivered a landmark decision on the award of costs in summary criminal proceedings. In circumstances where all charges had been dismissed, the defendant sought an order for costs. Mason CJ held that:
[1](1990) 170 CLR 534 (‘Latoudis’).
(a) in ordinary circumstances it would not be just or reasonable to deprive a defendant who has secured the dismissal of a criminal charge brought against him or her of an order for costs;[2]
[2]Ibid 542.
(b) it is inequitable that the defendant should be expected to bear the financial burden of exculpating himself or herself, though the circumstances may be such as to make it just and reasonable to refuse an order for costs or make a qualified order for costs;[3]
[3]Ibid.
(c) in exercising its discretion to award or refuse costs, a court should look at the matter primarily from the perspective of the defendant;[4]
(d) the award of costs is compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings;[5] and
(e) in ordinary circumstances, an order for costs should be made in favour of a successful defendant.[6]
[4]Ibid.
[5]Ibid 543.
[6]Ibid 544.
In the same decision, Toohey J, who was a member of the majority, held that:
(a) if a prosecution has failed, it would ordinarily be just and reasonable to award the defendant costs, because the defendant has incurred expense, perhaps very considerable expense, in defending the charge;[7] and
(b) in a particular case, there may be good reasons connected with the prosecution such that it would not be unjust or unreasonable that the successful defendant should bear his or her own costs, or, at any rate, a proportion of them.[8]
[7]Ibid 565.
[8]Ibid.
Likewise, McHugh J said:
(a) a successful defendant in summary proceedings has a reasonable expectation of obtaining an order for costs against the informant;[9]
[9]Ibid 566.
(b) the discretion to refuse to make a costs order should not be exercised against a successful defendant except for a reason directly concerned with the charge or the conduct of the proceeding;[10]
[10]Ibid.
(c) an order for costs indemnifies the successful party in litigious proceedings in respect of liability for professional fees and out-of-pocket expenses reasonably incurred in connexion with the litigation;[11]
(d) the rationale of the order is that it is just and reasonable for the party who has caused the other party to incur the costs of litigation to reimburse that party for the liability incurred;[12] and
(e) the function of a costs order is compensatory, and not to punish the unsuccessful party.[13]
[11]Ibid 566–7.
[12]Ibid 567.
[13]Ibid.
In Latoudis, the High Court had occasion to review the earlier Victorian decision of Puddy v Borg, where the Full Court of the Supreme Court had considered the discretion as to costs in summary criminal proceedings under the Justices Act 1958 (Vic) and said:
The discretion is one to be exercised in each case according to its own circumstances. Beyond limiting the power to such costs as to the court seems just and reasonable, the sub-section does not otherwise circumscribe the discretion conferred. No doubt it must be exercised judicially so as to achieve what is fair and just between the parties according to the circumstances of the particular case, and its exercise is open to challenge according to the well-established rules which govern the exercise of discretionary powers.[14]
[14][1973] VR 626, 628 (Winneke CJ, Smith and Menhennitt JJ) (‘Puddy’).
Mason CJ observed that Puddy had emphasised the unfettered nature of the discretion. It had decided that there is no prima facie rule one way or the other and that the discretion was to be exercised in each case according to its own circumstances.[15] Both Mason CJ and Toohey J considered that it was necessary and appropriate to formulate a principle or give guidance as to how the discretion should be exercised in order to avoid inconsistent or arbitrary decision making.[16]
[15]Latoudis (n 1), 539–40.
[16]Ibid 541–2 (Mason CJ), 562 (Toohey J).
Subsequent to Latoudis, Victorian courts have given consideration to how the discretion as to the costs of summary criminal proceedings should be exercised, not only in cases where all charges are dismissed but also in cases where the result is mixed with some charges proven whilst others are withdrawn or dismissed.
In Sobh v Children’s Court of Victoria,[17] Mandie J held that while a magistrate could, in an appropriate case, fix costs on a global basis, or, in fixing costs, take into account in the exercise of discretion the reasonableness not only of the individual items but also the total amount, there was an obligation to give adequate reasons in the circumstances of the case. The parties had been left in the dark as to what the magistrate had decided upon the disputed items argued before him.[18]
[17](1994) 74 A Crim R 453.
[18]Ibid 460.
While acknowledging the breadth of a Court’s discretion, Mandie J ruled that the magistrate’s reasons were inadequate and that it was not possible to conclude that the decision made was open to him. If the magistrate had given shortly stated reasons in relation to the items argued, the challenge to the exercise of his discretion might have failed, but this was not the case.[19]
[19]Ibid 461.
In Mansbridge v Nichols, Williams J reviewed the ambit of the statutory power to award costs in summary criminal proceedings and held that it was impossible in that case to discern how the submissions of counsel had been taken into account, whether there was an element of punishment involved in the award of costs or whether the award was reasonable. Her Honour quashed the relevant costs order and remitted the question of costs for determination in accordance with law.[20]
[20][2004] VSC 530, [135].
In Do v Bowers,[21] the appellant was charged with four driving offences. The appellant pleaded guilty to two offences, and was convicted of careless driving and driving a motor car in an unsafe condition. The prosecutor withdrew a charge of failing to undergo a preliminary breath test, and a charge of driving under the influence was dismissed. The evidence relating to the driving under the influence charge was also relevant to the two charges on which the appellant pleaded guilty. The magistrate fined the appellant, suspended his licence, and ordered him to pay statutory costs. He refused to order costs against the informant.
[21](Supreme Court of Victoria, O’Bryan J, 10 October 1996) (‘Do’).
O’Bryan J observed in Do that it was not unusual in the Magistrates’ Court for a defendant to contest a number of charges and at the end of the day be found guilty of some and not guilty of others. A defendant may be found not guilty of the most serious charge and guilty of the lesser charge arising out of the same transaction. In such circumstances a defendant would not be awarded costs as a successful defendant under the general rule. The appellant failed to show that the magistrate’s discretion miscarried through taking into account an irrelevant matter or omitting to take into account a relevant matter.
Costa v Parks involved a seven day hearing in the Magistrates’ Court with mixed results.[22] In two cases relating to Mr Costa, three charges were found proven. Fourteen other charges were withdrawn or dismissed. In two cases relating to Mr Shepherd, a co-defendant, twelve charges were withdrawn or dismissed and no conviction was recorded. The prosecution did not seek costs against Mr Costa or Mr Shepherd. The magistrate refused to order the prosecution to pay Mr Costa’s costs of the proceeding, and ordered that the prosecution pay Mr Shepherd one day’s costs of the joint hearing together with legal preparation costs.
[22][2008] VSC 47 (‘Costa’).
Habersberger J observed that in circumstances more complicated than those in Latoudis, whether or not a defendant should be regarded as successful will not be as clear.[23] His Honour found that there was no error in the way in which the magistrate had exercised her discretion as to costs in relation to Mr Costa. It would have unnecessarily complicated matters to have treated the charges separately. It was simpler to deal in one order with the costs of the whole hearing, taking into account the outcome of all of the charges. The prosecution would have expected that its partial success would be taken into account by the magistrate in deciding Mr Costa’s application for costs. It was open to conclude that Mr Costa was not a wholly successful defendant.[24] In relation to Mr Shepherd, Habersberger J reviewed the magistrate’s exercise of discretion in making a costs order, determining that error had not been demonstrated.
[23]Ibid [17].
[24]Ibid [33]–[35].
In Brown v Glen Eira City Council, all charges laid by the informant, an officer of VicRoads, against the Council were dismissed.[25] On appeal, the issue was whether the magistrate erred in awarding costs on an indemnity basis, or in the manner and procedure adopted to quantify costs.
[25][2012] VSC 198.
In reviewing the authorities concerning the costs to be awarded to a successful defendant in a criminal proceeding, Daly AsJ distilled the following principles:
(a)a successful defendant in summary proceedings has a reasonable expectation of obtaining an order for costs against the informant;
(b)generally speaking, a successful defendant should not be out of pocket as to costs reasonably incurred and reasonable in amount;
(c)the issue of costs should be looked at from the perspective of the successful defendant;
(d)a party entitled to an order for costs must, if challenged, show that particular costs were in fact incurred or that the professional work charged for was done, that the work was necessary or at least reasonably required for or reasonable to the defence of the proceedings or that the costs or charges were reasonable in amount and not excessive;
(e)contested criminal proceedings are not to be equated with contests between civil litigants given the element of compulsion and the different consequences of such proceeding;
(f)a magistrate may have regard to scales of costs relevant in civil proceedings but is not bound or limited by them;
(g)it is open for a magistrate, in an appropriate case, to exercise his or her discretion to award costs on a global basis, or, in fixing costs, take into account the reasonableness not only of the individual items but also of the total amount;
(h)there is no general principle requiring a magistrate to order against an informant whatever amount a defendant’s legal practitioner may have chosen to charge the client or whatever costs the solicitor and client may have agreed between themselves;
(i)the relevant enquiry is what the unsuccessful party may reasonably be required to pay the successful party at the conclusion of the litigation;
(j)any order for costs must always exclude any costs which have been unreasonably incurred or which are unreasonable in amount; and
(k) the governing principle to be applied is one of reasonableness.[26]
[26]Ibid [34] (citations omitted).
After reviewing the magistrate’s reasons, Daly AsJ concluded that the magistrate had failed to exercise the discretion open to her judicially.[27]
[27]Ibid [52].
In Agar v McCabe (No 2), T Forrest J reviewed the position as to costs in a proceeding arising out of a summary prosecution in the Magistrates’ Court, stating succinctly:
Costs are in the discretion of this Court. Although that discretion is effectively unfettered, there are limits on its exercise in the sense that it must be exercised judicially. The central principle that guides the discretion is one of doing justice to the parties in the circumstances of each case. The usual, though by no means unyielding, rule is that costs will follow the event.
Here, however, both parties have had some success and courts often make orders that reflect the parties’ relative success and failure. In my view, and in the circumstances of this case, the parties’ relative successes and failures will be best represented by making no order as to costs. The practical effect of this will be that each party will bear their own costs of this appeal.[28]
[28][2014] VSC 333, [1]–[2] (citations omitted).
Appeals from the exercise of discretion
In cases where there is an appeal from the exercise of a discretion, there is a strong presumption in favour of the correctness of the decision under appeal. Nonetheless, there are circumstances in which an appeal from a discretionary decision should be allowed.
In Australian Coal and Shale Employees’ Federation v Commonwealth, Kitto J said:
[T]he true principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretionary judgment is that there is a strong presumption in favour of the correctness of the decision appealed from, and that that decision should therefore be affirmed unless the court of appeal is satisfied that it is clearly wrong. A degree of satisfaction sufficient to overcome the strength of the presumption may exist where there has been an error which consists in acting upon a wrong principle, or giving weight to extraneous or irrelevant matters, or failing to give weight or sufficient weight to relevant considerations, or making a mistake as to the facts. Again, the nature of the error may not be discoverable, but even so it is sufficient that the result is so unreasonable or plainly unjust that the appellate court may infer that there has been a failure properly to exercise the discretion which the law reposes in the court of first instance …[29]
[29](1953) 94 CLR 621, 627, referring to House v R (1936) 55 CLR 499, 504–5. See also R v Guode (2020) 267 CLR 141, 161 (Gordon and Edelman JJ); Cecil v Director of Public Prosecutions (Nauru) (2017) 349 ALR 570, 571–2; Bondelmonte v Bondelmonte (2017) 259 CLR 662, 672–3; Thornberry v The Queen (1995) 69 ALJR 777, 777; Donnes v The Queen [2022] VSCA 132, [62] (Walker JA); Djordjevich v Rohrt [2022] VSCA 123, [11]; AJH Lawyers v Mathieson Nominees Pty Ltd [2015] VSCA 227, [69]; and Clark v McGuinness [2005] VSCA 108, [13] (Warren CJ).
This principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretion has been discussed in innumerable cases. What is important, if a decision is to be set aside, is that there is a degree of satisfaction sufficient to overcome the strong presumption in favour of the correctness of the decision.
What did the magistrate do?
The respondent contended in its written submissions that the magistrate did not in fact award the costs of the entire proceeding to the prosecution. The respondent submitted that the order for costs should be regarded as made only on the four successful charges before the Court.
The appellant contended that the costs order, which was made as a global amount in the Notice of Order Made in relation to charge 1, was plainly not intended to refer only to that charge. Rather, the substance of the exchanges between counsel and the magistrate as seen in the transcript indicated that the informant sought, and was awarded, the whole of her costs for the entire proceeding as assessed by the magistrate.
While the reasoning of the magistrate as captured in the transcript is far from clear, there is nothing in the transcript which indicates that the magistrate was awarding costs only in relation to those charges on which the prosecution was successful. The fact that the costs order is articulated only in the Notice of Order Made relating to charge 1, and not in the Notices of Order Made relating to any of the other charges, is inconclusive. The transcript shows that the magistrate considered the amount originally sought by the prosecution of $128,994.99 to be very large and that he did not want to award an amount less than counsel’s fees. The amount awarded of $75,000 was marginally in excess of the amount of disbursements of $69,814.69 which can be expected to be mostly made up of counsel’s fees, with the balance of the $75,000 left for solicitors’ fees. The prosecution subsequently agreed to the amount of $75,000 for legal fees which was the amount awarded to the prosecution for all charges, including those which were withdrawn or dismissed. There is no sign of any discounting, allowance, or apportionment in the costs award for the charges that were withdrawn or dismissed.
Analysis
The authorities which I have set out above may be summarised in the following manner. Under ss 401(1) and (2) of the Act, a magistrate has a broad discretion in making orders as to costs following the determination of a summary criminal proceeding. The court’s jurisdiction and power extends to the determination of the parties by whom, and to whom, costs are to be paid, and the amount of the costs to be paid. The broad discretion must be exercised judicially. There is no prima facie rule as to costs one way or the other. The discretion can be exercised globally, and is exercised in each case according to its circumstances. The reasons, or chain of reasoning, which led to a magistrate’s decision must be apparent, even if the reasons given are shortly stated. The question of costs is to be looked at from the perspective of the successful party.
In the present case, the results of the prosecution would fairly be described as mixed, with more charges dismissed or withdrawn than proven. The magistrate took, and was entitled to take, a global approach to the award of costs. He was not required to award costs individually on each charge. He was entitled to fix the total costs relating to all charges in a single amount. There is no complaint about the fact that he did so, or about the quantum of costs which he determined.
It is plain from the transcript that his Honour’s view was influenced by his reading of the decisions of Costa and Do. In Do, O’Bryan J held that a defendant found guilty of a lesser charge and not guilty of a more serious charge arising out of the same transaction should not be awarded costs. In Costa, Habersberger J distinguished Saleeba v Beck on the basis that that decision involved the construction of the relevant South Australian provisions.[30]
[30]Costa (n 22), [19], considering Saleeba v Beck (1991) 54 A Crim R 114.
Although in Costa the prosecution did not ask for costs in respect of the successful charges against Mr Costa, the argument on costs before the magistrate proceeded on the basis that costs would be dealt with as a whole. As so many charges were dismissed, Habersberger J observed that costs were never going to be awarded in favour of the prosecution.[31]
[31]Costa (n 22), [34].
In the present case, the magistrate expressed his view that the prosecution was successful, and that there was nothing that robbed the prosecution of its costs. It is not clear how the magistrate came to this view. There is no prima facie position that the prosecution is entitled to its costs – rather, the exercise of the discretion as to costs is made on the basis of the results and circumstances of the individual case. The notion of ‘robbing the prosecution of its costs’ involves a misconception that there is a prima facie position as to how costs should be awarded in summary criminal proceedings.
It is difficult to see how the magistrate felt able to exercise his discretion to award costs to the informant on all charges including those which were unsuccessful. The starting position was that the result was mixed. Neither the prosecution nor the defence had been entirely successful. Each had enjoyed success on some charges, but not on others. More charges had been dismissed or withdrawn than proved.
The magistrate’s reasons do not explain why he did not set off one party’s costs against the other, or why an order for a proportion of the total costs in favour of one party or the other was inappropriate. It is very difficult to see how the magistrate could have considered it reasonable that the defendant should pay the prosecution’s costs on charges which were dismissed or withdrawn.
The magistrate found that quite a number of the charges were made out. Presumably referring to the unsuccessful charges, the magistrate said that they ‘weren’t proved with respect to each and every element that was alleged, but nevertheless, the charges were carrying on a business when not registered to do so … [and] that charge was amply made out.’ The magistrate then awarded the prosecution the costs of charges which were not made out but were dismissed or withdrawn.
The magistrate’s reasons as to why he considered the prosecution to be successful for the purposes of awarding costs are erroneous insofar as they hold that it can be sufficient to establish success for costs purposes in a summary criminal prosecution that only some elements of an offence are proven by the prosecution.
It is trite to say that success in the case of a criminal offence involves proof of all essential elements of the offence as alleged in the charge beyond reasonable doubt. On the other hand, success for costs purposes for a defendant to a charge alleging a summary offence is the dismissal or withdrawal of the charge.
The magistrate had a number of options. He may have decided that the success of the prosecution on some charges was negated by the success of the defence on other charges, and made no order for costs. He may have considered the prosecution to have been more successful than the defence, or vice versa, and given reasons why this was so, and for the costs orders that followed. He may have ordered a proportion of the total costs in favour of one side or the other. He may have made costs orders on individual charges, although this would lead to a complicated and unwieldy taxation. The magistrate described himself as ‘in two minds about which way to go’, but he did not elaborate as to what the options were or why he preferred one over the other.
Instead, the magistrate awarded the costs of the proceeding as assessed by him to the prosecution, including the costs of all of the charges that failed, observing that there was nothing that robbed the prosecution of its costs. The result arrived at was inconsistent with the reasonable expectation of the parties that the appellant’s success in defending most charges would have some effect in its favour when costs were awarded. The result reached was not open to the magistrate in the sense that it was not within the possible range for the exercise of the discretion as to costs. No comprehensible reason was given as to why the discretion was exercised in the manner that it was.
There were no circumstances which led to the view that either the prosecution or the defence should be disentitled as to costs. This was not suggested in argument before the magistrate or before me. Both sides were entitled to rely on their success as to some charges.
Conclusion
In my view, the magistrate’s decision to award the prosecution the costs of the proceeding, including the costs of the charges which were dismissed or withdrawn, was not open to him. As far as can be discerned, it appears to stem from the erroneous notion that the prosecution is, as a matter of principle, entitled to the whole of the costs of the proceeding if it is successful on some charges. Such a starting point is inconsistent with the decision in Latoudis and the subsequent decisions to which I have referred. No justification is to be found in the magistrate’s reasons as to why it is that the normal rule that costs follow the event should be disregarded and reversed where the appellant was successful as to the majority of charges. To the extent that the magistrate considered that the proof of some of the elements of the charges ultimately dismissed was sufficient to support the view that the informant was the successful party on those charges, the decision was erroneous and wrong in principle. I accept the appellant’s submission that the magistrate’s decision was plainly wrong and gives rise to a manifestly unreasonable and unjust result.
Relief
The appellant submitted that the magistrate’s decision on costs should be set aside, and that I should re-exercise the discretion as to the costs of the proceedings in the Magistrates’ Court. Alternatively, the decision could be remitted to the magistrate for a fresh determination as to costs in accordance with law.
The exercise of the discretion under s 401(1) of the Act is better made by the magistrate who heard the proceeding. Section 401(1) provides for the discretion as to costs to be exercised by the magistrate who heard the proceeding. This is the ordinary course. The magistrate heard the case, the evidence and the submissions of the parties over six days, and is well placed to reconsider the exercise of his direction as to costs. The remitter will involve a further short hearing, or a hearing by written submissions from the parties, but is to be preferred to the determination of costs by this Court.
Order
I will order that the appeal be allowed, and the order of the Magistrates’ Court as to costs set aside. The proceeding will be remitted to the Magistrates’ Court for determination in accordance with law.
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