Dubow v Fitness First Australia Pty Ltd

[2006] FMCA 1959

FEDERAL MAGISTRATES COURT OF AUSTRALIA

DUBOW v FITNESS FIRST AUSTRALIA PTY LTD & ANOR [2006] FMCA 1959

HUMAN RIGHTS – Costs on discontinuance – set amount awarded.

Federal Court Rules (Cth), O.62
Federal Magistrates Court Rules 2001 (Cth), rr.13.02(1), 21.02(2)(a), Sch.1

Applicant: YOLANDE VICTORIA FRANCES DUBOW

First Respondent: FITNESS FIRST AUSTRALIA PTY LTD ACN 094 778 622

Second Respondent:

GARNAMA PTY LTD ACN 002 367 884

TRADING AS

LES MILLS BODY TRAINING SYSTEMS

File Number: SYG 1510 of 2005

Judgment of: Smith FM

Hearing date: 10 March 2006

Delivered at: Sydney

Delivered on: 10 March 2006

REPRESENTATION

Counsel for the Applicant: No appearance by or on behalf of the Applicant

Counsel for the First Respondent: Mr R Kent

Solicitors for the First Respondent: Norman Waterhouse Lawyers

Counsel for the Second Respondent: No appearance by or on behalf of the Second Respondent

ORDERS

1. The notice of discontinuance filed on 13 February 2006 is noted. 

2. The applicant must pay the first respondent’s costs set pursuant to r.21.02(2)(a) in the sum of $18,000.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 1510 of 2005

YOLANDE VICTORIA FRANCES DUBOW

Applicant

And

FITNESS FIRST AUSTRALIA PTY LTD ACN 094 778 622

First Respondent

GARNAMA PTY LTD ACN 002 367 884

TRADING AS LES MILLS BODY TRAINING SYSTEMS

Second Respondent

REASONS FOR JUDGMENT

(revised from transcript)

1. I have before me an application by the first respondent for the award of costs consequent upon the filing of a notice of discontinuance by the applicant on 13 February 2006.  I am satisfied that the applicant was given notice of today’s listing of the application in sufficient time to attend, and note that she has filed an affidavit with apparent relevance to the present application.  However, she has not appeared, and I have proceeded in her absence.  

2. The matter has a history which is revealed by the size of the file, and is explained in two affidavits by the solicitor for the first respondent, Rodney John Kent, sworn on 23 February 2006 and 10 March 2006.  I have considered those affidavits.  I have also considered and taken into account the statements in the applicant’s affidavit sworn on 7 March 2006. 

3. It is apparent to me from reading the affidavits, aided by a superficial assessment of the other material on the file, that the matter has involved exceptional legal expenses on the part of the first respondent. I accept its submission that it is appropriate for me not to assess costs according to the scale set out in Schedule 1 to the Federal Magistrates Court Rules 2001 (Cth).

4. The first respondent’s application sought orders for costs assessed by way of taxation under Order 62 of the Federal Court Rules (Cth), either on an indemnity basis or on a party‑party basis. 

5. I am not persuaded that I should approach the assessment of costs in relation to any period of this litigation on an indemnity basis.  This is because I have not been able to satisfy myself that this would be appropriate.  In my view, I could only do that by digesting all the material and forming a view about the underlying merits of the matter.  I am not prepared to do this purely for the purpose of a costs order, and it is a course which is generally inappropriate.  In this respect, I note that I was not previously involved in the proceedings.  The matter was moved into my docket in recent times, and was discontinued before I engaged in the preparation required for a three‑day hearing which was set down in April. 

6. I therefore approach costs on the basis that I have power either to send the matter for taxation to the registrars of the Federal Court for taxation under O.62 of the Federal Court Rules, perhaps with a direction reducing the scales to be applied, or attempting an ad hoc assessment by way of a lump sum. 

7. It is clear from the correspondence between the parties and the affidavits which I have read, that any taxation process would be an arduous and expensive process for all concerned.  In all the circumstances, I think it is appropriate for me to attempt a lump sum approach to the awarding of party‑party costs. 

8. The solicitor’s affidavit has explained the first respondent’s solicitor‑client costs totalling $30,629.92.  The substantial proportion of this is professional fees involved in the preparation of the matter, and in particular the preparation of bulky affidavit evidence.  My assessment of the case suggests that it was appropriate to have professional involvement at a high level.  I am not entirely persuaded that the number of hours revealed in the affidavits would be accepted on taxation, although this is possible.  I propose significantly to discount the claimed professional fees, both to take into account an element of disallowance when arriving at party‑party costs and also the likely discounting of the hourly rate which would occur in a taxation process.  I consider that I should set a lump sum with confidence that it would be clearly less than is likely to be awarded on taxation. 

9. Taking into account all of the material before me, and the submissions that were made to me today, I have decided that it is appropriate to set a lump sum of $18,000 under Federal Magistrates Court Rules 13.02(1) and 21.02(2)(a). 

I certify that the preceding nine (9) paragraphs are a true copy of the reasons for judgment of Smith FM

Associate:  Lilian Khaw

Date:  30 November 2009