Flew v Mirvac Parking Pty Ltd - [2006] FMCA 1818

FEDERAL MAGISTRATES COURT OF AUSTRALIA

FLEW v MIRVAC PARKING PTY LTD

[2006] FMCA 1818

HUMAN RIGHTS – Application for order specifying maximum costs under Rule 21.03 of the Federal Magistrates Court Rules – relevant factors.

Human Rights and Equal Opportunity Commission Act 1986
Disability Discrimination Act 1992
Federal Magistrates Act 1999
Federal Court of Australia Act 1976
Federal Magistrates Court Rules
Federal Court Rules

Ball v Morgan [2001] FMCA 127
Fetherson v Peninsula Health (No 2) (2004) 137 FCR 262
Gluyas v Commonwealth of Australia (No 2) [2004] FMCA 359
Hanisch v Strive Pty Ltd (1997) 74 FCR 384
Hollingdale v North Coast Area Health Service No 2 [2006] FMCA 585
Hughes v Western Australian Cricket Association (Inc) [1986] FCA 2491
IW v City of Perth (1997) 191 CLR 1
Muller v Human Rights and Equal Opportunity Commission & Anor [1997] FCA 634
Oshlack v Richmond River Shire Council (1994) 82 LGERA 236
Purvis v New South Wales Department of Education and Training (2003) 202 ALR 133
Ritter v Godfrey [1920] 2 KB 47
Sacks v Permanent Trustee Australia Limited (1993) 118 ALR 265
Woodland v Permanent Trustee Company Limited & Ors (1995) 58 FCR 139
Yates Property Corporate Pty Limited v Boland (No 2) (1997) 147 ALR 685

Applicant:

RICHARD FLEW

Respondent:

MIRVAC PARKING PTY LTD

File Number:

SYG2072 of 2006

Judgment of:

Barnes FM

Hearing date:

24 November 2006

Delivered at:

Sydney

Delivered on:

18 December 2006

REPRESENTATION

Counsel for the Applicant:

Ms E. Raper

Solicitors for the Applicant:

NSW Disability Discrimination Legal Service

Counsel for the Respondent:

Ms D. Ronalds SC

Solicitors for the Respondent:

Harmers Workplace Lawyers

ORDERS

That the application for an order specifying the maximum costs that may be recovered as between the applicant and the respondent be dismissed.
That the respondent’s costs of and incidental to the application be reserved.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG2072 of 2006

RICHARD FLEW

Applicant

And

MIRVAC PARKING PTY LTD

Respondent

REASONS FOR JUDGMENT

These proceedings

The applicant commenced proceedings by application filed on 27 July 2006 pursuant to s.46PO of the Human Rights and Equal Opportunity Commission Act 1986 (Cth) (HREOC Act) alleging unlawful discrimination against him by the respondent on the ground of disability in breach of ss.5, 6 and 15 of the Disability Discrimination Act 1992 (Cth) (the DDA), harassment in breach of s.35 and victimisation in breach of s.42.
In the application of 27 July 2006 the applicant also sought an order pursuant to Rule 21.03 of the Federal Magistrates Court Rules specifying the sum of $5,000 as the maximum costs including, but not limited to, the costs of experts and legal representatives, that may be recovered on a party and party basis as between the applicant and respondent in this matter. This judgment relates to the application for a Rule 21.03 order.
In relation to this issue the applicant relies on affidavits sworn by him and filed on 17 November 2006 and 23 November 2006. The respondent tendered a letter of 16 November 2006 from Harmers Workplace Lawyers, the solicitors for the respondent, to the Disability Discrimination Legal Centre, solicitors for the applicant. Each party filed written submissions.
It is not disputed that the Court has the power to make the Rule 21.03 order sought by the applicant. Such orders have been made by this Court where both parties have consented. However the respondent opposed the making of an order specifying maximum costs in this instance.
Rule 21.03 of the Federal Magistrates Court Rules is as follows:
(1)The Court may specify the maximum costs that may be recovered on a party and party basis:
(a)     by order at the first court date; and
(b)     of its own motion or on the application of a party.
(2)However, an amount specified must not include an amount that a party is ordered to pay because the party:
(a)has failed to comply with, or has sought an extension of time for complying with, an order or with any of these Rules; or
(b)     has sought leave to amend a document; or
(c)has otherwise cause another party to incur costs that were not necessary for the economic and efficient progress of the proceeding or hearing of the proceeding.
(3)The Court may vary the maximum costs specified if, in the Court’s opinion, there are special reasons and it is in the interests of justice to do so.

Submissions of the parties

It was contended for the applicant that given the apparent absence of reported decisions of this Court in relation to the operation of Rule 21.03, some guidance as to factors relevant to the exercise of the Court’s discretion may be obtained from the Federal Court’s approach to the similarly worded Order 62A of the Federal Court Rules.
Counsel for the applicant submitted in this context that it was relevant to have regard to the background to the 1992 introduction of Order 62A. Reference was made to a 1991 letter from the Chief Justice of the Federal Court of Australia to the President of the Law Council of Australia which is set out in Sacks v Permanent Trustee Australia Limited (1993) 118 ALR 265 at 267 – 268. That letter canvassed the possibility of the introduction of a provision in the Federal Court Rules allowing for the fixing of maximum costs. In it, the Chief Justice referred to concerns that the cost of litigation for persons of ordinary means placed access to the civil courts “beyond their reach” and that a “fear of the ultimate exposure in terms of legal costs to which an unsuccessful party may be subjected” was a deterrent to the assertion of rights in civil litigation. It was suggested that the object of a provision allowing for the fixing of maximum costs would be to “define a budget so that the management of the case might be tailored according to its economic limits” and that such a rule would be applied primarily to “commercial litigation at the lower end of the scale in terms of complexity and the amount in dispute, although it could be applied in other cases as appropriate”.
It was contended for the applicant that the objective expressed by the Chief Justice was subsequently affirmed in Hanisch v Strive Pty Ltd (1997) 74 FCR 384 at 387 per Drummond J. His Honour stated that the “principal object of O62A is to arm the Court with power to limit the exposure to costs of parties engaged in litigation in the Federal Court which involves less complex issues and is concerned with the recovery with moderate amounts of money …”.
On this basis it was submitted for the applicant that while the Court’s discretion was unfettered, the basic considerations for determining whether a maximum costs order was appropriate in this instance were:
·    the fact that the limits set for recoverable costs would apply to both parties (see Hanisch at 390);
·    that the matter involved consideration of legal issues of a less complex nature (see Hanisch at 387 and Dibb v Avco Financial Services Limited [2000] FCA 1785 at [15]),
·    that the matter concerned the recovery of a modest sum (Hanisch at 387); and
·    the undesirability of forcing an applicant to abandon proceedings (which, it was said, would be the result of not fixing maximum costs in this instance) in a matter where he had a case which appeared to be at least “seriously arguable” (see Woodland v Permanent Trustee Company Limited & Ors (1995) 58 FCR 139 at 148).
The applicant seeks an order setting a limit for recoverable costs applicable to both parties (see Hanisch v Strive Pty Ltd (1997) 74 FCR 384 at 390 per Drummond J and cf Sacks at 269 – 270 per Beazley J).
It was contended that the matter was not factually or legally complex. Based on the points of claim and the respondent’s defence, the factual matrix was said to relate to a six month period and “largely” to a small number of meetings and conversations which took place between the applicant and representatives of the respondent. In oral submissions counsel for the applicant did not pursue a contention in the written submissions in relation to the application of s.15(4) of the DDA, but submitted generally that the claims arose out of a limited factual matrix and did not involve complex legal concepts so that the matter could be described as at the lower end of the scale of legal complexity (albeit the issue of disability was disputed and the claim raised separate issues of harassment and victimisation as well as discrimination).
As to the amount in issue, it was pointed out that the applicant’s claim for economic loss was for a sum of $2,688.50 (not including interest). It was said that this could be characterised as a very low amount. Reference was made to the much higher figures considered to be fairly modest in Hanisch (at 387). While the applicant also made a claim for general damages that was not particularised, it was suggested that the amounts awarded by the court for such damages were generally modest.
Counsel for the applicant also pointed out that the applicant did not seek an exemption from any costs order in these proceedings and that it was recognised that the Federal Magistrates Court was not a no-costs jurisdiction in relation to human rights proceedings. It was contended that a maximum costs order would permit the applicant to proceed in circumstances where he had a legitimate claim but where the financial remedy sought was a secondary remedy and was said to be substantially less than the likely costs risk in the proceedings. The applicant seeks declarations directing the respondent not to repeat the conduct complained of and an order requiring the respondent to return the applicant (who, it is said, is an employee of the respondent working in a car park) to regular floor duties and not to confine him solely to booth duties.
It was suggested in written submissions for the applicant that the orders sought in this instance were primarily in respect of allowing the applicant’s “application for employment” to proceed without discrimination and contended that it was unfair to expose an individual applicant to a substantial and overwhelming costs risk where that individual sought simply to enforce a right not to have an application for employment affected by disability discrimination. In oral submissions it was clarified that the major reason for the proceedings was with respect to the current employment conditions of the applicant who had allegedly been demoted and required to submit to a group training exercise where his claimed disability impeded his ability to undertake such an exercise.
It was contended that based on the points of claim the applicant had an arguable and not vexatious or frivolous case of direct or indirect disability discrimination and that it was arguable that he had been harassed on the basis of his disability and victimised as the result of commencing these proceedings.
It was submitted that while an applicant should not have to prove that he would be forced to abandon the proceedings in the absence of an order fixing the maximum costs, this factor may be taken into account. Counsel for the applicant suggested that the potential costs of the proceedings in relation to the substantive application on the basis of a two-day hearing would be $13,230 plus disbursements under the scale in Schedule 1 to the Federal Magistrates Court Rules.
In support of the contention that denial of the orders sought would effectively deny the applicant access to the court the applicant relied on the two affidavits sworn by him relating to his financial situation. It was submitted that on the applicant’s unchallenged affidavit evidence he earned $41,000 per year, was of ordinary means, did not have capital assets, had a debt for his car and lived in rented accommodation and that it could be inferred that he was not affluent or a person who could easily commence and maintain proceedings. On this basis it was submitted that if the order sought was not granted it was likely that the applicant would be forced to abandon the present proceedings.
It was contended for the applicant that the federal anti-discrimination legislation was both remedial and beneficial (see IW v City of Perth (1997) 191 CLR 1 per Kirby J at [58] and Purvis v New South Wales Department of Education and Training (2003) 202 ALR 133 at [45] per Gleeson J) and that the court should be concerned not to discourage litigants from bringing meritorious claims because of the fear of an adverse costs order in the event that the applicant was unsuccessful. Rule 21.03 was said to permit the court to manage such fear of adverse costs in a manner which did not detract from the general rule that the winning party was entitled to an order for costs.
It was also suggested that the sum the applicant was likely to receive if wholly successful would be less than (or at least not significantly more than) the sum that he risked paying in costs if he were unsuccessful, even if costs were determined by reference to the scale in Schedule 1 to the Rules. It was submitted that this was too high a burden to impose on an individual who properly alleged that he had been treated unlawfully by the discriminatory procedures of a large private corporation.
For the respondent it was contended that as the evidence of both parties was not before the Court, it was not practical to estimate the length (and hence the cost) of the hearing as had been suggested and that the two days for which the hearing had been listed would be the minimum length for the hearing. It was submitted that this time would be fully taken up with evidence and that there would need to be a later date for oral submissions or written submissions. On this basis it was suggested that the amount of costs estimated by the applicant must be considered to be at the lower end of the potential costs in the proceedings.
It was submitted for the respondent that discrimination claims did not fall into a different category to other proceedings in the Federal Magistrates Court in relation to costs orders and that it has been established that human rights matters are not normally to be considered “no costs” matters in this Court (see Ball v Morgan [2001] FMCA 127 at [83] per McInnis FM). It was pointed out that costs orders had repeatedly been made against unsuccessful applicants in such matters in this Court. Reference was made to the observations of Heerey J in Fetherson v Peninsula Health (No 2) (2004) 137 FCR 262 at 263 (at [5] to [9]) confirming that the court had power to award costs in human rights matters and that “generally speaking, they should be ordered in favour of the successful party, although discretionary facts may lead to a different result” (ibid at [7]). As his Honour stated at [9]:
While the Disability Discrimination Act is without doubt beneficial legislation, its characterisation as such does not mean that this Court is to apply any different approach as to costs. In conferring jurisdiction under a particular statute Parliament may conclude that policy considerations warrant a special provision as to costs, for example, that there be no order as to costs or that costs only be awarded in certain circumstances … The absence of any such provision applicable to the present case confirms that the usual principles as to costs are to apply.”
(Also see Hollingdale v North Coast Area Health Service No 2 [2006] FMCA 585 at [10] per Driver FM and Gluyas v Commonwealth of Australia (No 2) [2004] FMCA 359 at [5] per Phipps FM).
It was submitted that given that the applicant was represented by a specialist legal centre and by counsel it should be presumed that he had been competently advised and, in particular, advised that if unsuccessful he would be exposed to a costs order that would be likely to be the amount set out in Schedule 1 of the Federal Magistrates Court Rules.
It was noted for the respondent that no public interest element was claimed in these proceedings and contended that the applicant’s claims in relation to “unfairness” in essence sought to cavil with the usual costs regime in casting it as oppressive and resulting in a deprivation of an applicant’s “right” to “enforce” his “application for employment”, when the applicant was not in fact enforcing any matter at this stage of the proceeding, but merely asserting a claim and seeking to prove it and where there was no application for employment in contention. There was said to be nothing special or unique in the applicant’s case. It was also contended that the claim about the “unfairness” of the usual principles as to costs was a matter for Parliament, not the court.
Moreover it was suggested that there was no evidence to sustain the proposition that it was likely that the applicant would be forced to abandon the present proceedings and no evidence of any change in his economic status after he voluntarily initiated litigation in a court where costs usually follow the event. It was contended that there was nothing about this particular application to warrant any alteration to the usual outcome if the applicant’s claims were dismissed.
Counsel for the respondent addressed the considerations said by the applicant to be relevant to the exercise of the Court’s discretion. It was submitted that in considering the relevance of decisions of the Federal Court in relation to Order 62A of the Federal Court Rules it should be borne in mind that, in contrast to the role and function of the Federal Court, the Federal Magistrates Court had been set up with particular objects (such as to streamline procedures) and had, consistent with its objects, adopted a scale of costs in Schedule 1 to the Federal Magistrates Court Rules which was to apply unless the court otherwise ordered (see Rule 21.10). It was submitted that the Schedule provided a measure of protection against exposure to the full party/party costs and in that sense provided a level of comfort and safety to an applicant and that in this context factors considered by the Federal Court in relation to less complex commercial litigation could be set aside. It was also observed that the 1991 letter of the Chief Justice of the Federal Court preceded the introduction of Order 62A.
As to the complexity of the proceedings, counsel for the respondent stressed that the respondent had not conceded that there had been an act of disability discrimination but rather denied all allegations. While it was acknowledged that the factual matrix of this case may be relatively limited, it was suggested that there could be complexity in the evidence as to disability which meant that the hearing would not be a short exercise. Further it was suggested that the substantial allegations (not only of direct and indirect discrimination but also of harassment and victimisation) and the widely expressed orders sought by the applicant gave rise to issues of legal complexity. In particular, it was submitted that the applicant had added layers of complexity to the proceedings by claiming not only direct but also indirect discrimination and hence necessitating consideration of different evidence and different tests, that s.15(4) was not relevant in these proceedings (a matter now conceded by the applicant), that the inclusion of the harassment and victimisation claims added to the legal complexity of the matter as there has been little judicial consideration of the extent of the operation of s.35 and conduct that may or may not fall within it and the issue of victimisation raised substantial factual and legal hurdles for the applicant in establishing his claims.
Counsel for the respondent acknowledged that the economic loss sought by the applicant was relatively modest, but noted that there was also an unparticularised claim for general damages in the points of claim. As money was not the only claim made it was submitted that comments in decisions in relation to the size of a recoverable claim in commercial litigation (where money was the only remedy sought) were not relevant or applicable in these proceedings. In particular it was observed that the applicant sought orders in the form of permanent injunctive relief and that this raised complex legal issues as to the extent, power, capacity and willingness of the court to make such orders. It was suggested that it was misguided to focus solely on monetary damages, as this did not address the full range of remedies sought in this instance.

As to the applicant’s contention in relation to an arguable case, it was submitted that at this stage the applicant had made a series of unsubstantiated allegations which may or may not be arguable at some later date and that nothing turned on this assertion in relation to the application.
Counsel for the respondent also addressed the submission that the applicant would be forced to abandon the proceedings. It was contended that the observations of Wilcox J in Woodland v Permanent Trustee Company Limited were not relevant to these proceedings as Woodland was a representative action involving litigation to potentially benefit “many thousands” of people which was being run in the public interest. Neither of those factors was present in this instance.
It was submitted that the notion of “abandonment” of proceedings was an inappropriate way to cast the matter and that there was no evidence to sustain such a proposition. It was contended that this proposition was not consistent with the applicant’s affidavit evidence, which included the statement that if he proceeded with the application he would be “unable to pay more than $5,000 in legal costs without going into further debt”. It was also contended that the financial status of an applicant was not generally relevant in determining a costs order and should not be relevant in determining this application. It was reiterated that there was no special nature of discrimination proceedings in relation to the costs rules and submitted that the usual principles should be applicable in determining this application. It was also said that there was no foundation to assert that the court should be concerned about discouraging litigants, as this represented confusion between the role of the Commonwealth Parliament and of the court.
Finally, it was submitted that the fact that the applicant had pro bono representation was not a relevant matter in relation to the issue of a maximum costs order. In conclusion it was contended that the applicant had failed to discharge the onus to demonstrate a proper basis for displacing the usual costs regime.
In reply counsel for the applicant contended that there was no necessity for “specialness” in the proceedings for a maximum costs order to be made, but that if “specialness” was required it was to be found in the factors relied on by the applicant.
It was also submitted that the fact that the applicant was seeking orders beyond monetary compensation did not add complexity as contended. As to the suggestion in Fetherson that costs should normally be awarded in human rights matters, it was pointed out that that was a case considering the costs to be ordered at the end of proceedings and did not involve an initial Rule 21.03 application. It was submitted that the Federal Magistrates Court was not required to apply the Schedule 1 costs, that the Schedule was only applicable if the Federal Magistrate chose to apply it under his or her discretion and that if the Schedule did provide sufficient comfort there would be no need for Rule 21.03. It was also suggested that it was always open for the Court under Rule 21.03(3) to vary a Rule 21.03 order if the nature or complexity of a matter changed.

Reasoning

In considering the principles relevant to the exercise of discretion to specify maximum costs under Rule 21.03 of the Federal Magistrates Court Rules it is relevant to have regard to the provisions and objects of the Federal Magistrates Act 1999 (Cth) and the Rules (see Rule 1.03(3)) and the interaction between Rule 21.03 and other Rules including the operation of Schedule 1 to the Rules.
Section 3 of the Federal Magistrates Act 1999 (Cth) sets out the objects of the Act which include to enable the Court to operate as informally as possible and to use streamlined procedures. Under s.79 of the Act the Court has jurisdiction to award costs “in all proceedings before the Federal Magistrates Court … other than proceedings in respect of which any other Act provides that costs must not be awarded”. Section 79(1) provides that s.79 does not apply to family law or child support proceedings (in relation to which s.117 of the Family Law Act 1975 applies so that, subject to specified exceptions, each party to proceedings under the Family Law Act bears his or her own costs). There is, however, no provision in the Federal Magistrates Act or in any other Act limiting the award of costs in human rights proceedings in this Court. In other words, Parliament has not introduced any special provision as to costs in human rights matters in this Court. Thus, as Heerey J observed in Fetherson at [9], while the Disability Discrimination Act is beneficial legislation, that characterisation “as such” does not mean that the Court is to apply any different approach in relation to costs to that taken in relation to other matters within the jurisdiction of the Court. The absence of any statutory provision limiting costs or providing that costs only be awarded in certain circumstances in human rights proceedings confirms that the usual principles as to costs are to apply in such matters. Indeed, it was acknowledged for the applicant that the jurisdiction of the Federal Magistrates Court in human rights matters is not a “no costs” jurisdiction. It was not suggested that there should be no order as to costs.
Section 79(3) of the Federal Magistrates Act provides that (except as provided by the Rules of Court or any other Act) the award of costs is in the discretion of the Federal Magistrates Court or Federal Magistrate. As has been held in relation to the similarly worded s.43(2) of the Federal Court of Australia Act 1976, while the discretion as to the award of costs is unfettered, it must be exercised judicially and in the context of the relevant court rules (see Yates Property Corporate Pty Limited v Boland (No 2) (1997) 147 ALR 685).
Section 81 of the Federal Magistrates Act gives the Federal Magistrates, or a majority of them, the power to make Rules of Court. Section 86 provides that the Rules of Court may make provision for or in relation to (inter alia) (b) the costs of proceedings in the Federal Magistrates Court and (d) the kinds of proceedings or circumstances in which each party is required to bear his or her own costs.
The Federal Magistrates Court Rules 2001 commence, in Rule 1.03, with a statement that the object of the Rules is to assist the just, efficient and economical resolution of proceedings and that in accordance with the objects of the Federal Magistrates Act, the Rules aim to help the Court to operate as informally as possible, to use streamlined processes and to encourage the use of appropriate dispute resolution procedures. Rule 1.03(3) provides that the Court will apply the Rules in accordance with their objects.
Part 21 of the Rules deals with costs. Rule 21.10 provides:
Unless the Court otherwise orders, a party entitled to costs in a proceeding (other than a proceeding to which the Bankruptcy Act applies) is entitled to:
(a) costs in accordance with Part 1 of Schedule 1; and
(b) disbursements properly incurred”
Part 1 of Schedule 1 contains an event-based specification of costs.
It is in the context of these provisions that Rule 21.03 provides that the Court “may” specify the maximum costs. The Rules do not however, provide any express guidance as to factors to be taken into account in exercising the discretion as to specification of maximum costs. Clearly the specification of maximum costs is in the discretion of the Court which must (as in relation to the award of costs in accordance with the generally expressed s.79(3)) be exercised judicially according to the particular circumstances of the case (and see Fetherson at [12] per Heerey J in relation to the caution to be exercised in reliance on “analogous” factors from other cases).
In the absence of any cited authority on Rule 21.03 I consider it is appropriate to have regard to the approach of the Federal Court in relation to Order 62A. Rule 21.03 is (like O 62A) “framed in terms which indicate that at least its principal purpose is to invest the court with a power to limit at the outset of litigation the potential liability of all parties flowing from a costs order made after proceedings have been heard and determined” (Muller v Human Rights and Equal Opportunity Commission & Anor [1997] FCA 634 per Moore J).
I have borne in mind, however, that unlike the Federal Court, the Federal Magistrates Court was set up as a lower level court to handle less complex federal matters (see the Second Reading Speech for the Federal Magistrates Bill 1999). It was created under legislation which specifies objects of the Act as set out above. Moreover, consistent with those objects and unlike the Federal Court, this Court has in its Rules provision for costs to be calculated in accordance with Part 1 of Schedule 1 to the Rules unless the Court otherwise orders. While no special provisions were made in relation to costs in discrimination matters in the Rules, Schedule 1 to the Rules limits and prescribes costs so that, unless the Court otherwise orders, an unsuccessful party will not necessarily be exposed to liability for the full party/party costs of the other side. Absent any particular factors, both parties should know when initiating litigation in this jurisdiction that costs are likely to be calculated in accordance with Schedule 1. Hence this factor may be weighed by applicants in determining whether and where to commence a discrimination claim. These provisions assist a prospective litigant to calculate (subject to the litigant’s ability to estimate the time and number of events in potential litigation) the likely extent of any costs order that may be made against the litigant should he or she be unsuccessful.
The applicant’s reliance on what was stated in a 1991 letter from the Chief Justice of the Federal Court to the President of the Law Council of Australia is of itself of limited assistance to this Court in exercising the discretion under Rule 21.03. The letter in issue was written by the Chief Justice prior to the introduction of Order 62A and canvassed the possible introduction of a provision for the fixing of maximum costs in light of concern within the court, the community and the legal profession that the cost of litigation for persons of ordinary means placed access to the civil courts beyond their reach. While the Chief Justice of the Federal Court recognised a need to provide for fixing of a maximum level for costs in relation to “commercial litigation” at the lower end of the scale, that need was identified in relation to a court which deals with commercial litigation across the complete range of complexity. Such factors do not apply with such force in relation to a lower level court handling less complex federal matters which has adopted a scale of costs such as that contained in Schedule 1 to the Rules which will apply unless the Court otherwise orders Rule 21.10. Rule 21.10 does represent a departure from the principle applicable in other courts as to recovery of party/party costs. I note that it does not apply to a proceeding in this court to which the Bankruptcy Act applies – but does apply (unless the court otherwise orders) to other proceedings including human rights proceedings.
However, subject to these matters, Federal Court authorities on O62A provide assistance as to the principles to be applied in relation to an application for an order specifying maximum costs. In particular I note that in Sacks Beazley J suggested that an assessment of the costs likely to be incurred in the matter and the basis for that assessment would be of assistance, not as a benchmark for any order likely to be made but to provide evidence as to “what costs are likely to be incurred and why such costs are likely to be incurred” (at [10]) so that the Court would be informed whether the amount of maximum costs sought to be specified was “reasonable, having regard to not only to the amount of the claim, but also the complexity of the issues, the extent of the work involved in the matter up to and including the hearing and the costs otherwise likely to be incurred” [ibid].
In this case counsel for the applicant made an estimate as to the likely costs to be recovered based on the application of Schedule 1 to the Rules. This was however no more than an estimate based on the time for which the hearing had been listed (based on the views of both parties on the first return date) and the application of Schedule 1 to the Rules. It may be that it was not possible to make a more accurate assessment of the likely extent of the costs to be incurred. All of the evidence (which will to a large extent determine the length of the hearing) is not yet before the Court. The parties are not in agreement as to the likely costs should this matter proceed to final hearing. This makes it more difficult to assess whether the amount the Court is asked to specify under Rule 21.03 is reasonable, having regard to matters such as those referred to in Sacks at [10].
It is not in dispute however that on the applicant’s assessment of likely liability for costs in accordance with Schedule 1 to the Rules, $5,000 is considerably less than the likely Schedule 1 or party/party costs. There is no suggestion that the conduct of the case can be modified so that the costs to be incurred by each party accord more closely to an amount in the order of $5,000. In that respect the fact that the applicant has pro bono representation does not assist. Insofar as counsel for the applicant seemed to suggest that there would not be “costs” incurred for the applicant sought to be recovered from the respondent should the applicant be ultimately successful, this would not address the position of the costs to be recovered by the respondent should the applicant be unsuccessful.
More generally, in Woodland Wilcox J referred (at [23] – [30]) with apparent approval to the approach of the New South Wales Land and Environment Court to the award of costs in litigation involving a substantial public interest element and the view of that court that categorisation of proceedings as public interest litigation of itself was not enough to constitute “special circumstances” warranting a departure from the usual costs rule at the conclusion of a hearing (see Oshlack v Richmond River Shire Council (1994) 82 LGERA 236). This approach suggests that factors relevant to a consideration of whether there are special circumstances warranting a departure from the general principle that costs follow the event (see Ritter v Godfrey [1920] 2 KB 47 and Hughes v Western Australian Cricket Association (Inc) [1986] FCA 2491), may also be relevant to the exercise of a discretion under a provision such as Rule 21.03, albeit bearing in mind that this court is being asked not only to make a decision at the outset of the litigation but also to depart from the likely application of Part 1 of Schedule 1 in quantifying the extent to which such costs are recoverable. In Woodland Wilcox J also went on to find in relation to the O62A application that the public interest element should not necessarily be regarded as decisive but was a factor of “some significance” (at [31]). There is no suggestion of such public interest in this case. His Honour also referred (at [31]) to the arguability of the applicant’s case (another factor taken into account by Stein J in the context of whether there were special circumstances warranting a departure from the “usual rule”).
Thus it is relevant as part of all the circumstances of the particular case to consider matters such as the timing of the application, whether the order sought is proposed to apply for the benefit of both parties, the nature and likely complexity of the claim and the extent of the remedies sought, the costs likely to be incurred as well as any other matters which may go towards establishing that there should be a departure in advance from the usual rules as to quantification of the amount of costs to be payable by the ultimately unsuccessful party.
I note that there was no suggestion in this case that if a maximum costs order was made it should apply to only one party. It is sought that the maximum costs of $5,000 should be specified as the costs recoverable by either party. The application was made at the time of the original application (see Rule 21.03(1)).
The applicant suggested, and the respondent did not dispute, that the factual and legal complexity of the proceedings was a relevant factor. I consider it relevant to take such matters into account, but in the circumstances of this case I am not persuaded on the material before the Court that it can be said that this matter is at the lower end of the scale of legal complexity of matters within the jurisdiction of this Court. I accept that, as conceded for the respondent, the application arises out of a relatively confined factual basis. However it involves claims of both direct and indirect discrimination and also harassment and victimisation, each of which is denied by the respondent. As contended for by the respondent, this adds levels of complexity. It is, of course, a matter for the applicant whether to proceed in this manner and I express no view on the necessity for the applicant so doing. However the applicant will have to establish the elements of each of the grounds on which he relies. Given the extent of the matters that must be established for the applicant to succeed in these claims, it cannot be said that this is a relatively straightforward direct discrimination case in which there are not complex legal issues to address. Further, the issue of disability is itself a matter of dispute between the parties. At this stage the evidence before the Court is not such that the extent of that dispute can be determined.
The next matter raised by the applicant is the suggestion that only a modest amount of money is sought. The economic loss sought in this case is a modest sum. However it is not the only remedy sought. It is apparent from the points of claim filed by the applicant that he also seeks an unparticularised amount of general damages as compensation for loss, hurt, humiliation and distress resulting from the alleged discriminatory conduct, harassment and victimisation. Further, he seeks declarations and an order requiring the respondent to return the applicant to “regular floor duties and not to confine the applicant solely to booth duties”. A certain amount of complexity is likely to be involved in any assessment of whether the orders sought by the applicant should be made, should the conduct alleged be established.
It was also contended for the applicant that there would be a deterrent to the applicant if the maximum costs were not fixed as sought. It is clear that fear of exposure to costs may act as a deterrent to litigation. While it would, as Wilcox J stated in Woodland at [31], be “undesirable” to take a course that would force applicants to abandon legitimate proceedings, it has not been established that the applicant would be “forced” to abandon the litigation. In any event, impecuniosity of one party or claims about the relative financial significance of the cost of proceedings for the parties cannot of themselves be determinative.
The only evidence in support of this contention is the applicant’s affidavit evidence as to his financial position, including the statement that if he proceeds with the application “I will be unable to pay any more than $5,000 in legal costs without going into further debt”. However this evidence does not go so far as to establish that the applicant will be “forced” to discontinue his proceedings should maximum costs not be set as he now seeks. Such a consequence cannot be inferred from the evidence that he is a man of ordinary means and income without available capital assets who would need to go into further debt to meet costs of more than $5,000.

Further, it is notable that there is no suggestion of public interest in the present proceedings. This was a factor found to be of some significance in Woodland v Permanent Trustee Company Ltd (1995) 58 FCR 139. It was in that context that Wilcox J at [31] apparently considered it undesirable that the applicants in representative proceedings be forced to abandon litigation with the potential to benefit thousands of people.
Insofar as the applicant makes a general claim about the “unfairness” of a deterrent effect on applicants in human rights proceedings of the prospect of an adverse costs order on a party/party basis, I note first the existence of Schedule 1 to the Rules, as discussed above, but also that there is nothing in the legislation indicating that policy considerations warrant a special provision as to costs in human rights matters (see Fetherson at [9]). This is, of course, not to say that it will not be appropriate to make an Order under Rule 21.03 in a human rights proceeding. Rather, each case must be determined on its particular circumstances.
The applicant’s contention that the substantive case was “arguable”, simply in the sense of not vexatious or frivolous, is not of assistance. While the extent of the “serious arguability” of an aspect of a case may be relevant, this cannot be assessed on the material before the Court. In any event, while this issue can be meaningfully considered at the conclusion of proceedings (for example in relation to whether there should be a departure from the usual rule as to costs) it will be of less assistance at a time when the ultimate merits of the case cannot be determined (although see Woodland at [31]).
It was also suggested for the applicant that it was relevant that under Rule 21.03(3) it was always open for the Court to vary a maximum costs order in the event that the nature or complexity of the case changed. However Rule 21.03(3) is not as broadly expressed as seems to have been suggested. It provides that the Court may vary the maximum costs specified if “in the Court’s opinion there are special reasons and it is in the interests of justice to do so”. The fact that a maximum costs order may be varied in such limited circumstances does not mean that the court should be quick to make such an order.
The existence of an offer by the respondent to settle the matter at this stage is not something which I find of assistance in the exercise of my discretion under Rule 21.03 as to whether or not it is appropriate to specify the maximum costs that may be recovered on a party/party basis. I note that this is not a case in which the parties consent to the making of a Rule 21.03 order.
Having regard to all the circumstances of the case, the applicant has failed to demonstrate that this is an appropriate case for a Rule 21.03 order.
The respondent sought that the applicant meet its costs of the proceedings in relation to Rule 21.03 in accordance with Schedule 1 of the Rules and that such costs should be payable immediately and should not be costs in the cause. The applicant submitted that if he was unsuccessful in obtaining an order under Rule 21.03 either there should be no order as to costs or, in the alternative, that the costs should be costs in the cause.
The matter is listed for final hearing on 7 March 2007. In all the circumstances I consider it appropriate to reserve the costs of the respondent of and incidental to this application. I will, however, hear argument on this issue at the end of the case.

I certify that the preceding sixty-one (61) paragraphs are a true copy of the reasons for judgment of Barnes FM

Associate:

Date: 18 December 2006