Costa Vraca Pty Ltd (ACN 005 913 431) v Bell Regal Pty Ltd (ACN 076 871 648)

[2004] FCAFC 60

FEDERAL COURT OF AUSTRALIA

Costa Vraca Pty Ltd (ACN 005 913 431) v Bell Regal Pty Ltd (ACN 076 871 648) [2004] FCAFC 60

COSTA VRACA PTY LTD v BELL REGAL PTY LTD AND OTHERS
V 773 of 2000
A & F & D MERCURI PTY LTD v BELL REGAL PTY LTD AND OTHERS
V 774 of 2000
TANRIKULU ENTERPRISES PTY LTD v BELL REGAL PTY LTD AND OTHERS V 775 of 2000
ANTHONY FRANK ROSSIGNUOLO v BELL REGAL PTY LTD AND OTHERS
V 776 of 2000
NICOLANGELO de PALMA AND ANOTHER v BELL REGAL PTY LTD AND OTHERS
V 777 of 2000
EREN & SONS PTY LTD v BELL REGAL PTY LTD AND OTHERS
V 778 of 2000
GARY JOHN BIRTH AND ANOTHER v BELL REGAL PTY LTD AND OTHERS
V 779 of 2000
BANKS FARM HOLDINGS PTY LTD v GUMRANGE PTY LTD AND OTHERS

V 780 of 2000

RYAN, KIEFEL AND GYLES JJ
19 MARCH 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 773 of 2003

BETWEEN:

COSTA VRACA PTY LTD
(ACN 005 913 431)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 774 of 2000

BETWEEN:

A & F & D MERCURI PTY LTD
(ACN 059 180 362)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 775 of 2000

BETWEEN:

TANRIKULU ENTERPRISES PTY LTD
(ACN 064 331 442)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 776 of 2000

BETWEEN:

ANTHONY FRANK ROSSIGNUOLO
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 777 of 2000

BETWEEN:

NICOLANGELO de PALMA
First Applicant 

NICOLINA de PALMA
Second Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 778 of 2000

BETWEEN:

EREN & SONS PTY LTD
(ACN 064 034 037)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 779 of 2000

BETWEEN:

GARY JOHN BIRCH
Applicant 

GLORIA ROBIN BIRCH
Second Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 780 of 2000

BETWEEN:

BANKS FARM HOLDINGS PTY LTD
(ACN 010 739 983)
Applicant 

AND:

GUMRANGE PTY LTD
(ACN 078 465 308)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:

RYAN, KIEFEL AND GYLES JJ

DATE OF ORDER:

19 MARCH 2004

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT the second and third respondents pay the applicant’s costs of and incidental to the motion on notice dated 11 March 2003, such costs to be taxed in default of agreement.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 773 of 2000

BETWEEN:

COSTA VRACA PTY LTD
(ACN 005 913 431)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

AND BETWEEN:

V 774 of 2000

A & F & D MERCURI PTY LTD
(ACN 059 180 362)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

AND BETWEEN:

V 775 of 2000

TANRIKULU ENTERPRISES PTY LTD
(ACN 064 331 442)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

AND BETWEEN:

V 776 of 2000

ANTHONY FRANK ROSSIGNUOLO
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

AND BETWEEN:

V 777 of 2000

NICOLANGELO de PALMA
First Applicant 

NICOLINA de PALMA
Second Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

AND BETWEEN:

V 778 of 2000

EREN & SONS PTY LTD
(ACN 064 034 037)
Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

AND BETWEEN:

V 779 of 2000

GARY JOHN BIRCH
First Applicant 

GLORIA ROBIN BIRCH
Second Applicant 

AND:

BELL REGAL PTY LTD
(ACN 076 871 648)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent

CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

AND BETWEEN:

V 780 of 2000

BANKS FARM HOLDINGS PTY LTD
(ACN 010 739 983)
Applicant 

AND:

GUMRANGE PTY LTD
(ACN 078 465 308)
First Respondent

HAZERA (1939) LIMITED
Second Respondent

HAZERA GENETICS LIMITED
Third Respondent
CORALBERRY HOLDINGS PTY LTD
(ACN 055 454 816)
Fourth Respondent

JUDGES:	RYAN, KIEFEL AND GYLES JJ
DATE:	19 MARCH 2004
PLACE:	MELBOURNE

REASONS FOR RULING ON COSTS

THE COURT:

1. On 19 December 2003, this Full Court published its reasons for refusing Hazera (1939) Limited and Hazera Genetics Limited (“the Hazera respondents”) leave to appeal from the dismissal by the learned primary Judge of a motion by the Hazera respondents in each proceeding that the service of the originating process on the Hazera respondents be set aside for non-compliance with O 8 r 2(2) of the Rules of this Court.  At first instance, the Hazera respondents had sought, in the alternative, that, as against them, each proceeding be stayed pursuant to O 20 r 2(ii)(c).  Although the application to this Court was for leave to appeal, full argument was heard as if the Hazera respondents had appealed as of right.

2. In the course of our reasons published on 19 December 2003, we acknowledged the force of criticisms by the Hazera respondents of part of the reasoning below. One such criticism was that the prima facie breach of s 52 of the Trade Practices Act 1974 (Cth) which had been found by his Honour had not been pleaded in the amended statement of claim. Nor had it been referred to in the substantial body of evidence adduced, or the submissions made, at first instance. As was pointed out at [10] of the reasons of this Full Court;

   ‘… … The Hazera respondents have clearly demonstrated that the finding was based upon a misconception.  The reference to ‘Germ Tested’ had nothing to do with germs in the sense of bacterial or other organisms but, rather, referred to germination.  Furthermore, the evidence is that only one of the applicants received a sealed seed packet and there is no evidence that any statement on it was read and understood as was found by the primary Judge by any person on behalf of that applicant.  The packages were supplied to a nursery rather than to the applicant in the other cases.  We would add that where leave is granted on ex parte application to serve originating process on a foreign respondent out of the jurisdiction pursuant to O 8 r 2(2) by reference to a statement of claim, caution should be exercised in permitting a later amendment to cure the absence of a proper basis for jurisdiction at the time leave was given in circumstances where the foreign party is disputing jurisdiction.  If the case was defective at inception, no leave to serve should have been given.  We do not suggest that mere infelicity of pleading would amount to such a defect (cf Cell Tech Communications Pty Ltd v Nokia Mobile Phones (UK) Ltd (1995) 58 FCR 365 at 373–374). A new and distinct factual and legal basis for the originating process may be in another category depending upon the circumstances. After all, the jurisdiction which is to be exercised is exorbitant. In the present case the statement of claim had already been amended once by the time of the primary hearing.’

3. Despite upholding that contention and identifying, without resolving it, a difficulty with the finding below of a prima facie case in negligence against the Hazera respondents, we went on to hold that the proper approach was to ask whether a local respondent had been properly joined in the proceedings and then to determine whether the Hazera respondents would have been proper parties to the proceedings had they been within the jurisdiction.  Both of those questions were answered in the affirmative.  Accordingly, leave to appeal was refused and the parties were directed to file written submissions as to the appropriate orders for costs.  Those written submissions have now been filed.  On behalf of each applicant which was a respondent to the motion by the Hazera respondents, orders were sought that the applicant’s costs of and incidental to the Hazera respondents’ motion on notice dated 11 March 2003 be paid by the Hazera respondents and that those costs be taxed and paid forthwith.  In support of their contention, the applicants argued that the Hazera respondents had consistently disputed that the Court had jurisdiction to entertain the proceedings as required by O 8 r 2(2)(b) and that the applicants had established a prima facie case as required by O 8 r 2(2)(c).  The Hazera respondents’ assertions had been explicitly rejected on the application for leave to appeal and, in accordance with the usual rule, costs should follow the event.  As well, Counsel for the applicants identified fourteen factors said to militate in favour of this Court’s exercising its discretion by making an order for their costs to be paid by the Hazera respondents.  Some of those factors were restatements of the propositions that the Hazera respondents had lost on issues which they had consistently pursued and that costs should follow the event. 

4. The applicants also pointed to the unusual volume of evidence which had to be canvassed to determine whether they had a prima facie case and the multiplicity of issues raised by the Hazera respondents’ proposed grounds of appeal.  In particular, the Hazera respondents had failed to disturb the primary Judge’s finding central to the existence of a prima facie case that the bacterial canker which had been the cause of the failure of the applicants’ tomato crops had originated in the Hazera respondents’ “Daniela” seed.  Finally, the applicants emphasised the long time between November 2000 and 15 February 2002 which had been allowed to elapse before the Hazera respondents mounted a challenge to the jurisdiction of this Court to entertain the action against them. 

5. On the other hand, it was submitted on behalf of the Hazera respondents that, because leave to appeal had been refused solely on grounds not argued or raised at first instance and because of doubts expressed by the Full Court about certain findings and part of the reasoning of the primary Judge, it should be ordered that the costs of all parties be those parties’ costs in the cause.  In support of that contention reference was made to an indication said to have been given by this Full Court in its reasons that “the current form of the pleadings raises matters for further consideration by the primary Judge as to the existence of some, or any, prima facie causes of action against the Hazera respondents, hence as to the viability of the pleaded claim.”  What we said in this context was at [26];

   ‘Further, we have indicated that there is substantial doubt about some of the findings made by the primary Judge and there were no findings in relation to some issues.  Deciding the appeal would involve considering issues which may be of significance at trial but on incomplete material.  It would only further complicate the trial if those issues were determined on an interlocutory basis on such material.  The state of the pleadings can be considered by the docket Judge in light of these reasons.’

6. The Hazera respondents sought to derive support for their submission on costs from Malick v Lloyd (1913) 16 CLR 483 where the High Court observed, at 492, in the concluding sentence of the judgment;

   ‘As the point on which the case is found to turn was not argued below we do not think we should allow the appellants their costs of the appeal.’

   See also National Australia Bank v KDS Construction Services Pty Ltd (1987) 163 CLR 668.

7. However, different considerations apply, in our view, where an appellant or applicant for leave to appeal has been unsuccessful.  A party in that position can be taken to have assumed the risk of the appellate court’s upholding the result below on any ground which it perceives to be available including a ground which had not been advanced by, or argued before, the primary Judge.  Exceptions to that proposition have been illustrated by Oriental Inland Steamship Co v Briggs (1861) De G F & J 191 and Fischer v Kamala Naicker (1860) 8 Moore Ind. App 170 [19 ER 495] to which we have also been referred by Counsel for the Hazera respondents. In Oriental Inland Steamship Co Lord Westbury LC, who upheld a decision of the Vice-Chancellor but on new and different grounds and without prejudice to any new bill by the plaintiffs, made no order as to the costs of the appeal.  The Privy Council similarly declined to make an order for costs in Fischer v Kamala Naicker.  However, we do not consider those cases to be sufficiently analogous to the present to warrant an order that the costs of all parties to the motion be those parties’ costs in the cause.  To make such an order would expose the applicants to a risk of not recovering their own costs and of paying the Hazera respondents’ costs of a self-contained jurisdictional issue which was apparent from the outset, which was raised by the Hazera respondents and on which the applicants have been successful.

8. Having given careful consideration to the written submissions on both sides, we have concluded that the appropriate order is that the Hazera respondents pay the applicants’ costs of the several applications for leave to appeal.  However, we have not been persuaded that those costs should be taxed and paid forthwith or otherwise before the determination of the actions at first instance. 

I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Ruling on Costs herein of the Honourable Court.

Associate:

Dated:             19 March 2004

Counsel for the Applicants for leave (Second and Third Respondents):	Mr C Maxwell QC with Mr C Caleo
Solicitor for the Applicants for leave (Second and Third Respondents):	Clayton Utz
Counsel for the Respondents on the application for leave (Applicants):	Mr R Macaw QC with Mr E Szabo
Solicitor for the Respondents on the application for leave (Applicants):	Coulter Roache
Date of Hearing:	4 and 5 August 2003
Date of Judgment:	19 December 2003
Submissions on Costs of Respondents on the application for leave (Applicants):	4 February 2004
Submissions on Costs of Applicants for leave (Second and Third Respondents):	15 January 2004
Date of Costs Ruling:	19 March 2004