Commonwealth of Australia v Farage Esber

[1991] FCA 878

JUDGMENT ~0.8'7.K.. lQ\,,

JN THE FEDERAL COURT OF AUSTRALIA )

SLAND DISTRICT REGISTRY 1 NO. Q& 40 OF 1991

BETWEEN:

COMMONWEALTH OF AUSTRALIA

FIRST APPLICANT

l%E COMMISSION FOR THE SAFETY

ILITATION AND COMPENSATION OF

COMMONWEALTH EMPLOYEES

SECOND APPLICANT

W :

FARAGE ESBER

MINUTES OF ORDERS

JUDGE MAKING ORDER:	Drummond J
DATE OF ORDEflr	5 December,
WHERE MADE:	Brisbane
THE COURT ORDERS THAT:

36 of the Federal Court Rules.

1. The application for an order staying the costs order made by the Full Federal Court on 30 May, 1991 is diemiesed.

2. The applicants pay the respondent's costs of and incidental to the application.

   Settlement and entry of orders is dealt with in Order

THE F E D E ~ COURT OF AUSTRALIA 1

D DISTRICT REGISTRY ) No. Q& 40 OF 1991

GENERAL DIVISION 1

BETWEEN:

COMMONWEALTH OF AUSTRALIA

FIRST APPLICANT

THE COMMISSION FOR THE SAFETY, REHABILITATION AND COMPENSATION OF COMMONWEALTH EMPLOYEES

SECOND APPLICANT

FARAGE ESBER

RESPONDENT

s u m ! l :	Drummond J
m:	5 December, 1991

place: Brisbane

EX TEKPORE REASONS FOR JUDGMENT

This is an application by the Commonwealth and the Commission for the Safety, Rehabilitation and Compensation of	Commonwealth Employees, the appellants in proceedings in the Full
Court of the Federal Court in an appeal from a decision of the Administrative Appeals Tribunal presided over by a judge of the Family Court, for an order that the costs order made by the Full Federal Court in connection with its decision given on 30 May, 1991 be stayed, pending judgment of the High Court of Australia, on an appeal from that decision.

L

The costs order the subject of this application was made in favour of the present Respondent, although he was the unsuccessful party in the Full Court proceedings. The critical point upon which the Respondent there failed was whether the Tribunal was correct in applying the provisions of m Com~ensation lCommonwealth Government Em~lovees) Act 1971 to its review of the refusal to approve redemption by a lump sum payment of the Respondent's entitlement to periodic payments, rather than the provisions of The Commonwealth Emulovees Rehabilitation and

Dm~eneation Act 1988.

As appears from the judgments in the Full Federal Court, the Tribunal first ruled on this matter in an interlocutory decision given on 1 June 1990 and the Applicants were content for some time thereafter to accept the Tribunal's view that the 1971 Act governed the position. On 8 April, 1991, the Applicants applied to this Court for leave to amend their notice of appeal to raise this critical point.

Pincus J adjourned that application to the Full Court. On 16 April, 1991 the Applicants advised the Respondent that, if their application for leave to amend the notice of appeal was successful, they would rely only on the amended grounds of appeal and, should it be unsuccessful, they would abandon the entire appeal. The Respondent opposed the amendment, but the Applicants, through their counsel, informed the Full Court that

if leave were granted, they would pay the Respondent's costs of

the appeal "irrespective of the outcome" and they also informed the Court that they would seek no order varying the order of the Tribunal that they pay his costs of the proceedings before the Tribunal.

Following the Full Court decision on 30 May, 1991, the Respondent successfully obtained special leave from the High Court of Australia to appeal that decision. That appeal was heard on 12 November, 1991 and the High Court has reserved its decision. Understandably, no challenge was made in the course of the High Court appeal to the order for costs made in favour of the Respondent in the Full Federal Court to which I have

re£ erred.

So far as these particular costs are concerned, the Respondent after some delay, has now acted in accordance with the procedure set out in Order 62. The Applicants called for a bill of costs on 30 May, 1991; it seems that the Respondent took no action to prepare a bill until about mid-October. There is no

explanation for this delay on his part. On 15 November, 1991,

the Taxing Officer certified those costs at $10,960.55. On the

eolicitor for the Applicants. On 3 December, 1991, the costs	same day, a copy of the Certificate of Taxation was served on the
being unpaid, the Respondent procured fromthe Registrar an order for their payment.
The Applicants have for some time now been aware that the Respondent is a person of limited means. (See paragraph 15
of Mr. Bishop's affidavit filed 2 December, 1991 in which he refers to a conversation with the Respondent's solicitor, Mr. Taylor, on 14 October, 1991. ) Although Mr. Taylor, in cross-
examination, did not concede that he had, in fact, told Mr. Bishop that the Respondent had no money, it is clear that Mr. Taylor has accepted personal liability for outgoings incurred to date in respect of both counsel's fees and court costs.
The Applicants ultimately paid the Respondent's taxed costs of the proceedings before the Tribunal in the sum of $31,359.87 on 1 November, 1991.
It was not until 13 November that the Applicants expressed concern at the possibility that, should they obtain an order for costs in the High Court proceedings, it might be unenforceable because of the Respondent's impecuniosity. The Applicants then sought an assurance (which was not provided) that the Respondent would not seek to recover his costs of the Full Court proceedings until the High Court proceedings had been determined.
Counsel for the Respondent submitted that, in the circumstances of this case, a single judge of the Federal Court did not have juriediction to grant the stay sought by the
Applicants.
In submitting that I did have jurisdiction, counsel for the Applicants relied on S. 25(2) (d) of The Federal Court Act and also on the decision of Pincus J in Patton v Minister for Defence
aAnor. (1987) 13 F . C . R . 476.

The Respondent's counsel submittedthat it was original jurisdiction, rather than appellate jurisdiction which the Full Court exercised in this case. He referred to 8.19, s.22(2) of The Federal Court Act and s.44(3) of The Administrative Avveals Tribunal Act. He submitted that s.25(2) (d) of The Federal Court

m applied only to the staying of orders made by the Full Court

in the exercise of its appellate jurisdiction. He also submitted that Egtton's case was distinguishable since here, an appeal to the High Court has been instituted and s.77U of The Judiciarv Act prescribes the only courts with authority to grant the relief sought, namely in this case, the High Court and the Full Court of the Federal Court, but not a single judge of the Federal Court.

There is, I think, something to be said for the argument advanced by counsel for the Respondent. However, it is Unnecessary for me to decide the question of my jurisdiction since, if there be jurisdiction to grant the relief sought, it is a discretionary one, and the application must be dismissed

because of discretionary considerations.

The factor that favours the grant of the stay sought is the Respondent's financial situation. I am prepared to find that there is a real risk that any judgment for costs the Commonwealth might obtain in the High Court proceedings may go unsatisfied, unless it can be set off against the Respondent's

entitlement to costa in respect of the Full Court proceedings.

The evidence is summcirised in paragraph 15 of Mr. Bishop's affidavit referred to above and paragraph 42 of Mr. Taylor's

affidavit filed on 3 December, 1991. What emerged in cross- examination of Mr. Taylor confirms that the risk is a real one.

In view of the evidence concerning the Respondent's financial position, I would ordinarily have required an undertaking from his solicitor to repay the amount received from the Applicants in respect of the costs of the Full Court proceedings in the event that the Applicants succeed in obtaining an order for costs in respect of the High Court proceedings, if I were to dismiss the Applicants' motion. The Applicants' preferred position is that they would be prepared to give an Undertaking to pay to the Respondent his costs of the Full Court proceedings within five working days of judgment being given in the High Court, which is adverse to the Applicants, so far as coste are concerned (although the Applicants would prefer the solicitor's undertaking in the last resort, if the application is to be dismissed). Notwithstanding what was said in Grif f iths v Benn (1911) 27 T.L.R. 346 at 350, I think the general principle i8 that an order for payment of money, including an order for

coste, will not be stayed pending appeal, unless there is a risk	that, if the money is paid, it may not be repaid should the
appeal be successful. I do not think it matters whether the risk emerges only after a hearing at first instance or after an intermediate appeal. See J.C. Scott Constructions v Mermaid Waters Tavern Ptv. Ltd. (No. 21 [l9831 2 Qd. R. 255 at 260 and, in particular, the cases cited at paragraphs E to F of that page.

7   l

There are, however, a number of considerations that have lead me to my conclusion that the application should be dismissed.

Firstly, and by far the most important, there are the somewhat unusual circumstances in which the Respondent obtained the order for costs in the Full Federal Court following what the Applicants here describe as their "offer". I have referred to those circumstances already. It seems to me that when the Applicants made this "offer" in the Full Court, it was to the intent that the Respondent would have their costs of those proceedings, come what may. The Applicants made this "offer" which lead to their being granted leave to amend their Notice of Appeal, to obtain the advantage for them of ensuring that they would be able to raise a point of general importance. It was conceded before me that the case was regarded, on the critical point I have referred to, by the Applicants as a test case.

Secondly, the Applicants have been aware of the Respondent's uncertain financial position for a considerable

time. Yet the application is brought at a very late stage -

after argument has been heard in the High Court and after that Court has reserved its decision. No explanation has been offered on behalf of the Applicants for this delay, an omission that is of some significance given the concern that has motivated the present application. This delay is not great, but is of

eignif icance i n view of what has occurred aince mid-October. I

have referred to the delay on the part of the Respondent in enforcing the Court's order. I do not think that is of any real

significance in the balancing exercise that has to be carried out
here.

Thirdly, the case is one in which, even if the Applicants are successful in their High Court appeal, I do not think there is any high degree of certainty that they will obtain an order in their favour in respect of the costs of that appeal:

I have referred to the case being a test case on the point which

has now been considered by the High Court.

I therefore dismiss the Applicants' motion and I

propose to order the Respondent have his costs of the motion.

I certify that this and the

seven preceding pages are a
true copy of the reasons for

judgment herein of the

Honourable Mr. Justice Drummond.

Associate:	bJv-d ?,4.-bV
Date:	5 ~ecembGr,	1991