Hamilton v Meta Platforms, Inc. (Costs)

Case [2023] FCA 1496

FEDERAL COURT OF AUSTRALIA

Hamilton v Meta Platforms, Inc. (Costs) [2023] FCA 1496    

File number(s): NSD 899 of 2020
Judgment of: CHEESEMAN J
Date of judgment: 29 November 2023
Catchwords:  COSTS – where proceeding permanently stayed – where the applicant sought an order under s 82(4) of the Competition and Consumer Act 2010 (Cth) (CCA) (NACO) – where the application for the NACO has not been determined – where the application for a permanent stay determined prior to the hearing of the NACO application – whether s 82 of the CCA displaces the general presumption that costs follow the event – whether procedural course resulted in unfairness that justifies a departure from the general presumption – Held: Applicant to pay respondents’ costs.
Legislation:

Competition and Consumer Act 2010 (Cth) ss 82(3), 82(4), 82(5), 82(6)

Federal Court of Australia Act 1976 (Cth) ss 37M, 37N(4), 43(1), 43(1A), 43(2)

Federal Court Rules 2011 (Cth) rr 10.42, 10.43(2) and 10.44(1)

Cases cited:

Adam P Brown Male Fashions Pty Ltd v Phillip Morris Inc [1981] HCA 39; 148 CLR 170

Bhagat v Royal and Sun Alliance Life Assurance Australia Ltd [2000] NSWSC 159

Décor Corporation Pty Ltd v Dart Industries Inc [1991] FCA544; 33 FCR 397

El-Debel v Micheletto (Trustee) (No 2) [2021] FCAFC 146

Fisse v Secretary, Department of the Treasury & Anor (No 2) [2008] FCAFC 200; 253 ALR 52

Hamilton v Meta Platforms, Inc (Service out of Jurisdiction) [2022] FCA 681

Hamilton v Meta Platforms, Inc. [2023] FCA 1148

LFDB v SM (No 2) [2017] FCAFC 207

Northern Territory v Sangare [2019] HCA 25; 265 CLR 164

Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72

Southern Cross Exploration NL v Fire & All Risks Insurance Co Ltd (No 2) (1990) 21 NSWLR 200

Division: General Division
Registry: New South Wales
National Practice Area: Commercial and Corporations
Sub-area: Regulator and Consumer Protection
Number of paragraphs: 52
Date of last submissions: 7 November 2023
Date of hearing: Determined on the papers
Counsel for the Applicant: The applicant was self represented
Counsel for the First Respondent: Mr M Darke SC and Ms K Lindeman
Solicitor for the First Respondent:  Corrs Chambers Westgarth
Counsel for the Second Respondent: Mr R A Yezerski SC
Solicitor for the Second Respondent: Herbert Smith Freehills

ORDERS

NSD 899 of 2020
BETWEEN:

ANDREW PAUL STUART HAMILTON

Applicant
AND:

META PLATFORMS, INC.

First Respondent

GOOGLE LLC

Second Respondent

ORDER MADE BY:

CHEESEMAN J

DATE OF ORDER:

29 NOVEMBER 2023

THE COURT ORDERS THAT:

1.The applicant’s application to vary order 3 made on 29 September 2023 (the Costs Order) be dismissed.

2.The applicant pay the respondent's costs of the application to vary the Costs Order.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

CHEESEMAN J

INTRODUCTION

  1. On the application of the respondents, this proceeding was permanently stayed: Hamilton v Meta Platforms, Inc. [2023] FCA 1148 (Hamilton Stay

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Details
AGLC
Hamilton v Meta Platforms, Inc. (Costs) [2023] FCA 1496
Case
[2023] FCA 1496
Decision Date

CaseChat Overview and Summary

The case of Hamilton v Meta Platforms, Inc. (Costs) involved a proceeding brought by Mr Hamilton against Meta Platforms, Inc. The dispute centred on an application for a permanent stay of the proceeding, an application for a no-admission costs order (NACO), and the costs associated with these applications. The Federal Court of Australia was tasked with deciding whether the special costs provisions in section 82 of the Competition and Consumer Act 2010 (Cth) (CCA) displaced the general presumption that costs follow the event. The court was also to consider if the procedural course of the case warranted a departure from this general presumption.

The court examined whether the combination of the NACO provisions, the broad standing provisions, and the public interest in competition law cases justified a departure from the usual rule that costs follow the event. Mr Hamilton argued that the legislative intent behind section 82 of the CCA was to encourage competition claims by creating a special costs regime for those that meet specific criteria. However, the court found that the successful parties had not engaged in any conduct that disentitled them to costs and that the proceeding had been prosecuted efficiently. The application for a permanent stay was made promptly, heard, and succeeded, which heavily weighed in favour of awarding the respondents their costs. The court concluded that the balance of factors favoured awarding the respondents their costs, aligning with the usual order.

The court's reasoning was grounded in the result of the litigation and the nature of the issue, which was the likelihood that the proceeding would bring the administration of justice into disrepute. The absence of any countervailing factors, such as disentitling conduct on the part of the respondents, further supported the decision to award costs against Mr Hamilton. The court clarified that even if it had adopted a neutral starting position without regard to the general presumption, it would have arrived at the same result. The court declined to vary the costs order made on 29 September 2023.

In conclusion, the court dismissed the applicant’s application to vary the costs order and ordered that the applicant pay the respondent's costs of the application to vary the costs order. The decision underscores the importance of the result of the litigation and the efficiency with which the proceeding was prosecuted, reinforcing the general rule that costs follow the event.

Orders

Orders of the court

1. The applicant’s application to vary order 3 made on 29 September 2023 (the Costs Order) be dismissed.

2. The applicant pay the respondent's costs of the application to vary the Costs Order.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

On the other side of the ledger, this is not a proceeding in which it would be appropriate to depart from the general presumption because the successful parties are guilty of disentitling conduct or have otherwise failed to act in accordance with the overarching purpose embodied in s 37M of the FCA Act. Mr Hamilton makes no submission to that effect. There is nothing in the way in which the respondents have responded to the proceeding brought against them that weighs against the award of costs following the event. The event being the successful application to have the proceeding permanently stayed. That application was brought promptly following the proceeding being served, prosecuted efficiently and ultimately succeeded. In combination these matters weigh heavily in favour of awarding the respondents their costs.CONCLUSION Taking into account all of the matters raised by the parties relevant to the exercise of the discretion to award costs, I am satisfied that the balance weighs heavily in favour of awarding the respondents their costs. The usual order is that costs should follow the event. For the reasons given, I am satisfied that the usual order is the correct order in the present application. For completeness, I note that although I have rejected Mr Hamilton’s contention that the general presumption that costs follow the event is displaced by the combination of circumstances in the present case, including the NACO provisions, the wide standing provisions and the inherent public interest in competition law cases, even if I accepted Mr Hamilton’s submission it would not have made a difference in the result. Had it been necessary to begin from a neutral position without regard to the general presumption, I would have arrived at the same result. To my mind, taking into account the whole of the circumstances, the most important factors relevant to the exercise of the discretion to award costs is the result of the litigation (Oshlack at [66]) and relatedly, the nature of the issue on which Mr Hamilton came unstuck — that his proceeding was likely to bring the administration of justice into disrepute. Against these factors, it is significant that there were no countervailing factors in the form of disentitling conduct on the part of the respondents. These factors weighed heavily in favour of making an award of costs against Mr Hamilton, even if a neutral starting position was adopted. For these reasons, I decline to vary the costs order made on 29 September 2023.

Ratio Decidendi

Legal Principle Established

To be clear, these reasons only address s 82 of the CCA insofar as it is relied on by Mr Hamilton in respect of the costs argument in relation to the stay application.CONSIDERATION It is convenient to first address Mr Hamilton’s contention that the general presumption that costs follow the event is displaced in this proceeding by the special costs regime provided for in s 82 of the CCA.Mr Hamilton’s NACO application Mr Hamilton instituted his application for a NACO at an early stage of the proceeding. The claim for a NACO was included in the originating application and in a number of interlocutory applications filed thereafter. In his Amended Originating Application he included a request that this application be heard at the earliest opportunity. The progress of the proceeding in this Court involved case management hearings before Rares J, as a result of which, the pleading of Mr Hamilton’s claim was revisited over a period of time before Mr Hamilton’s application for leave to serve the respondents outside the jurisdiction came to be determined. The application for leave to serve out was brought under rr 10.42, 10.43(2) and 10.44(1) of the Federal Court Rules 2011 (Cth) as then applying. Mr Hamilton agitated to have his application for a NACO determined at the same time as his application for leave to serve the respondents outside the jurisdiction. The effect of hearing the application at that time would have been to determine the NACO application on an ex parte basis. I declined to hear and determine Mr Hamilton’s NACO application in the absence of the respondents because the Court would not have the benefit of a contradictor: Hamilton v Meta Platforms, Inc (Service out of Jurisdiction) [2022] FCA 681 at [2] (Hamilton Service Out). Mr Hamilton next agitated to have his NACO application determined in September 2022, by which time the respondents had been served and had appeared in the proceeding. A case management hearing was held on 21 September 2022. In advance of that case management hearing, Mr Hamilton and the respondents each filed written submissions which addressed, inter alia, the parties’ respective positions on the order in which various interlocutory applications should be heard. At that time, relevantly, the interlocutory applications included Mr Hamilton’s NACO application and a foreshadowed application by the respondents for a permanent stay or in the alternative a de‑classing order and a strike out or summary dismissal application. Following that case management hearing, and after hearing oral submissions from the parties, I ordered that the application for a stay, which was predicated on the allegation that the proceeding was likely to bring the administration of justice into disrepute, be heard and determined before any other interlocutory applications. As I understand his submissions, Mr Hamilton acknowledges that s 82(4) of the CCA does not expressly restrict the discretion as to costs under s 43(2) of the FCA Act, however, he submits that s 82(4) displaces the usual presumption that costs follow the event in matters where the requirements set out in s 82(5) of the CCA are met. Mr Hamilton submits that the legislative purpose of s 82 of the CCA is to encourage potential applicants to bring competition claims in circumstances which meet the criteria in s 82(5), and thereby creates a special costs regime that applies to such claims.