FEDERAL COURT OF AUSTRALIA
Hillier v Martin (No 16) [2022] FCA 1155
File number(s): SAD 113 of 2020 Judgment of: O'SULLIVAN J Date of judgment: 20 September 2022 Catchwords: COSTS – application for costs following dismissal of an interlocutory application filed by a non-party – where costs to be assessed on a lump sum basis and the non-party pay costs forthwith pursuant to s 43 of the Federal Court of Australia Act 1976 (Cth) and r 40.13 of the Federal Court Rules 2011 (Cth) – where a party has incurred significant costs over and above those which it would have incurred had the opposing party acted with competence and diligence – where a discrete issue has been resolved – application granted Legislation: Federal Court of Australia Act 1976 (Cth), s 43
Federal Court Rules 2011 (Cth), r 40.13
Cases cited: Australian Flight Test Services v Minister for Industry, Science and Technology [1996] FCA 288
Bischof v Adams [1992] 2 VR 198
Caboolture Park Shopping Centre Pty Ltd (In Liq) v White Industries (QLD) Pty Ltd [1993] FCA 667; (1993) 45 FCR 224
Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 10) [2009] FCA 498
Gore v Justice Corp Pty Ltd [2002] FCAFC 354; (2002) 119 FCR 429
Hillier v Martin (No 13) [2022] FCA 939
Kebaro Pty Ltd v Saunders [2003] FCAFC 5
Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178
Life Therapeutics Ltd v Bell IXL Investments Ltd (No 2) [2008] FCAFC 158; (2008) 170 FCR 595
Vestris v Cashman (1998) 72 SASR 449
Watson v Kriticos (Costs of Summary Judgment Application) [2021] FCA 917
Division: General Division Registry: South Australia National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Number of paragraphs: 10 Date of hearing: 20 September 2022 Counsel for the Applicant: Mr R Whitington KC with Ms H Doyle Solicitor for the Applicant: Sykes Bidstrup Solicitor for the First and Second Respondents: Mr A Wright appearing for WK Lawyers Counsel for the Third Respondent: No appearance Counsel for the Other: Mr T Martin in person ORDERS
SAD 113 of 2020 BETWEEN: JAMES HILLIER
Applicant
AND: VICTORIA MARTIN
First Respondent
NORDBURGER OPERATIONS PTY LTD
Second Respondent
ERIK VARI PTY LTD
Third Respondent
THOMAS MARTIN
Other
ORDER MADE BY:
O'SULLIVAN J
DATE OF ORDER:
20 SEPTEMBER 2022
THE COURT ORDERS THAT:
1.Rule 40.13 of the Federal Court Rules 2011 (Cth) be dispensed with.
2.The non-party, Thomas Patrick Martin, pay the applicant’s costs of and incidental to the interlocutory application filed 21 July 2022 by Thomas Patrick Martin on a party-party basis.
3.The costs referred to in order 2 herein be assessed on a lump sum basis.
4.The matter be referred to a Registrar to fix a lump sum in order 3 herein.
5.Thomas Patrick Martin is to pay the lump sum fixed in accordance with order 4 herein within 28 days of the…
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- AGLC
- Hillier v Martin (No 16) [2022] FCA 1155
- Case
- [2022] FCA 1155
- Decision Date
CaseChat Overview and Summary
The court considered the legal principles surrounding costs orders, noting that ordinarily, costs cannot be assessed until the determination of the proceeding. However, the court may depart from this rule if a party’s unreasonable behaviour has caused the other party to incur additional costs. In this case, Mr Martin's application was not only unnecessary but also discrete, meaning it was resolved in isolation from the main proceeding. The court emphasised that a costs payable forthwith order is not the same as an indemnity costs order. Given that the matter involved a non-party who had acted without competence and diligence, the court granted the applicant’s request for costs to be assessed forthwith.
In its reasoning, the court acknowledged the unusual nature of the application and the need to avoid multiple taxations of costs. The court held that Mr Martin’s actions had caused the applicant to incur unnecessary costs, which would not have been incurred if Mr Martin had acted competently and diligently. The court concluded that the discrete nature of the issue and the unreasonableness of Mr Martin’s application justified an immediate costs order. Consequently, the court ordered Mr Martin to pay the applicant's costs on a lump sum basis and forthwith. The court also directed that the costs be assessed by a Registrar and paid within 28 days of the lump sum being fixed. This decision reinforced the principle that costs orders can be made forthwith in cases of unreasonable behaviour by a non-party.
Orders
Orders of the court
1. Rule 40.13 of the Federal Court Rules 2011 (Cth) be dispensed with.
2. The non-party, Thomas Patrick Martin, pay the applicant’s costs of and incidental to the interlocutory application filed 21 July 2022 by Thomas Patrick Martin on a party-party basis.
3. The costs referred to in order 2 herein be assessed on a lump sum basis.
4. The matter be referred to a Registrar to fix a lump sum in order 3 herein.
5. Thomas Patrick Martin is to pay the lump sum fixed in accordance with order 4 herein within 28 days of the Registrar fixing the lump sum.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
In Watson v Kriticos (Costs of Summary Judgment Application) [2021] FCA 917, [23]-[26] Perram J noted:23The ordinary rule is that costs cannot be taxed or assessed until the determination of the proceeding: FCR r 40.13. Relevant matters include the possibility that costs orders made in favour of one party in the course of a proceeding may be set off against costs orders made in favour of the other and the desirability of avoiding multiple taxations: Capic v Ford Motor Company of Australia Limited (Costs Forthwith) [2019] FCA 1065 (‘Capic’) at [17]. The ordinary rule may be departed from where a party has engaged in unreasonable behaviour which has caused the other party to incur additional expenditure which would have not have been incurred if the other party had acted with competence and diligence: Capic at [18]. It is also relevant to take into account the length of time between when the costs order is made and when the costs might finally be taxed, ie, how long the matter will take to get to trial and judgment. On the other hand, a costs payable forthwith order is not to be seen as akin to an indemnity costs order.Consideration Mr Martin is legally qualified. The application was unusual in that as a non-party he applied to re-open argument on a joinder application that had been heard and upon which the decision had been reserved. Mr Martin sought an order that he be allowed to make submissions and tender evidence at a re-opened argument. During the course of the argument as to whether he had standing, Mr Martin, who appeared for himself, was given the opportunity to put before the Court authorities in support of his contention that he had standing. He cited two authorities, neither of which assisted his case. This application should not have been brought. It was necessary for the applicant’s solicitors to work on the application and for Counsel to argue the point of standing, thereby putting the applicant to cost and expense. Further, the application was a discrete issue that has been resolved: Australian Flight Test Services v Minister for Industry, Science and Technology [1996] FCA 288. Mr Martin is to pay the applicant’s costs of and incidental to the interlocutory application to be assessed as a lump sum by a Registrar on a party-party basis and pay those costs by on or before 28 days from the fixing of the lump sum.