Federal Treasury Enterprise (FKP) Sojuzplodoimport v Spirits International B.V. (No 5)

Federal Treasury Enterprise (FKP) Sojuzplodoimport, a Russian entity, commenced proceedings against Spirits International B.V. The dispute involved issues related to the enforcement of arbitral awards and related costs. The matter was heard in the Federal Court of Australia. The respondents, including Cross-Claimants, filed an interlocutory application seeking costs, which was subsequently stayed by the court. The applicants later sought an order for costs to be paid forthwith and a lump sum costs order.

The legal issues before the court encompassed the principles governing the determination of costs in interlocutory applications and the appropriate circumstances for ordering costs to be payable forthwith. The court had to consider whether the applicants' application met the criteria for such an order, including the need for immediate payment due to urgency or hardship.

The court held that the applicants had not demonstrated the necessity for a costs order to be payable forthwith. It emphasised that such orders are exceptional and require strong justification. The court noted that the applicants had not shown any urgency or hardship that would warrant immediate payment of costs. Consequently, the court dismissed the interlocutory application for costs to be paid forthwith and also rejected the application for a lump sum costs order. Instead, the court ordered that the respondents pay the applicants' costs of the interlocutory application.

The court's orders included varying the stay to permit the interlocutory application to be determined and allowing the Cross-Claimants to defend the application. The stay was varied to the extent necessary only to facilitate the determination of the interlocutory application and to allow the Cross-Claimants to defend themselves. The court dismissed the interlocutory application and ordered the respondents to pay the Cross-Claimants' costs of that application.