Hurley v McDonalds Australia Ltd

[1999] FCA 1393

FEDERAL COURT OF AUSTRALIA

Hurley v McDonalds Australia Ltd [1999] FCA 1393

JANETTE LYN HURLEY v McDONALDS AUSTRALIA LIMITED
Q 194 of 1999

DOWSETT J
1 OCTOBER 1999
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q 194 OF 1999

BETWEEN:	JANETTE LYN HURLEY Applicant
AND:	McDONALDS AUSTRALIA LIMITED Respondent
JUDGE:	DOWSETT
DATE OF ORDER:	1 OCTOBER 1999
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.        The notice of motion filed on 14 September 1999 is dismissed.

2.        The applicant pay the respondent’s costs of the motion.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q 194 OF 1999

BETWEEN:	JANETTE LYN HURLEY Applicant
AND:	McDONALDS AUSTRALIA LIMITED Respondent

JUDGE:	DOWSETT
DATE:	1 OCTOBER 1999
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. With respect to the notice of motion filed on 14 September 1999, to which Creata Promotions (Aust) Pty Ltd ACN 001 598 303 is a respondent, the motion is dismissed.

2. I am asked to make an order for costs on an indemnity basis.  Of course the respondent's involvement in this matter has presumably been quite short in that it is, for present purposes, only the respondent to an application for third party inspection.  I cannot really see why there should be any significant difference as between party and party costs, and solicitor and client costs. 

3. Party and party costs are, in my view, designed to meet costs reasonably incurred in prosecuting or defending the proceedings in question.  It would not be a good thing if legal advisers involved in relatively narrow proceedings were to expect, as a matter of course, an order for solicitor and client, or indemnity costs.  The general rule has always been that costs be taxed on a party and party basis, although over the years a number of categories of exception have emerged.  It may well be that the categories of exception are not closed, but for the moment I do not think that they should be capriciously extended. 

4. Having said that, there is something to be said for the respondent's application in this case.  The application as formulated appears to have been destined to failure from the beginning because it is much more akin to an application for general discovery against a party than an application for inspection against a third party.  Some attempt was made to narrow down the range of the application, but that appears to have been less than successful.  I suppose another relevant consideration in these proceedings is that they are third party proceedings.  As between parties to litigation, it may be reasonable to tie them to the party and party cost structure.  Where a third party is unnecessarily disadvantaged, it is probably true to say, as Mr Greenwood has suggested, that there is no compelling reason to deprive that party of such reasonable costs as may be incurred in resisting the application.  What may be reasonable costs from the respondent's point of view in those circumstances is, though, still a matter for the taxing officer.

5. The critical considerations in this case are twofold.  In favour of making the order sought by the respondent is the fact that it has been brought into these proceedings for no good reason, and pursuant to an application which was destined to fail.  Against the order is the fact that the application is only a relatively minor one, and it is hard to see why the costs reasonably incurred by the respondent in seeking to be successful in it should necessarily be significantly greater than those available on a party and party basis.  The decision, in my view, comes down to a resolution of the weight to be attributed respectively to those two considerations.  I find myself unable to distinguish in a meaningful way between the weight to be attributed to them, and in those circumstances I conclude that the proper course is to follow the usual practice and to order costs on a party and party basis. 

6. It was said in the course of argument that there was a practice of allowing costs on an indemnity basis in respect of applications of this kind.  Certainly, insofar as costs are incurred in complying with an order for discovery against a third party, it is the practice to order costs on an indemnity basis.  I am not sure, however, that such practice should necessarily be extended to include the costs of appearing to oppose such an application. 

7. In the circumstances I will order that the applicant pay the respondent's costs of the motion.  I make no order as to the basis of taxation, intending that they be taxed in the usual way, on a party and party basis.

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.

Associate:

Dated:             14 October 1999

Counsel for the Applicant:	Ms D A Skennar
Solicitor for the Applicant:	Shine Roche McGowan
Counsel for the Respondent:	Mr P Greenwood
Solicitor for the Respondent:	Baker & McKenzie
Date of Hearing:	1 October 1999
Date of Judgment:	1 October 1999