In the matter of an application by Leanne Cover (No 2)

[2024] ACTSC 251

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:

In the matter of an application by Leanne Cover (No 2)

Citation: 

[2024] ACTSC 251

Hearing Date: 

On the papers

Decision Date: 

26 July 2024

Before:

McCallum CJ

Decision: 

The costs of the plaintiff’s interlocutory application are to be the defendant’s costs in the cause.

Catchwords: 

COSTS – where plaintiff unsuccessful in application for urgent interlocutory injunction to restrain publication of special report prepared by the Integrity Commission – usual rule that unsuccessful applicant for an interlocutory injunction should pay the defendant’s costs – court’s discretion not fettered by usual rule – where plaintiff constrained in presentation of injunction application by confidentiality regime imposed by defendant

Legislation Cited: 

Court Procedures Rules 2006 (ACT), r 1701(2)

Cases Cited: 

His Eminence Metropolitan Petar, Diocesan Bishop of the Macedonian Orthodox Church of Australia and New Zealand & Anor v The Macedonian Orthodox Community Church St Petka Incorporated & Anor (No 2) [2007] NSWCA 142

In the matter of an application by Leanne Cover [2024] ACTSC 197

Westpoint Finance Pty Ltd v Chocolate Factory Apartments Ltd [2002] NSWCA 287

Parties: 

Leanne Cover ( Plaintiff)

ACT Integrity Commission ( Defendant)

Representation: 

Counsel

P Horobin ( Plaintiff)

B Kaplan ( Defendant)

Solicitors

Mills Oakley ( Plaintiff)

ACT Integrity Commission ( Defendant)

File Number:

SC 199 of 2024

McCALLUM CJ:       

EX TEMPORE REASONS (REVISED) 

1․On 18 June 2024, Leanne Cover commenced these proceedings seeking injunctive relief to restrain the ACT Integrity Commission from presenting a special report to the Speaker of the Legislative Assembly as required under the legislation that governs the Commission.  I heard the application on 21 June 2024.  On 25 June 2024, I refused the application for the reasons published that day: In the matter of an application by Leanne Cover [2024] ACTSC 197. It remains to consider the costs of the application.

2․In the primary judgment at [52] I held that, in all the circumstances, I was not satisfied that the plaintiff had shown a sufficient likelihood of success to justify preserving the status quo.  However, in reaching that conclusion, I emphasised a number of matters, including at [53] the fact that it had not been possible for me to assess the legal errors alleged by the plaintiff to the extent that such errors were allegedly shown on the face of the draft report.  The reason it was not possible for me to assess those matters was that the plaintiff did not tender the draft report on the application.  The reason the plaintiff did not tender the draft report is because she understood herself to be constrained from doing so by a confidentiality constraint imposed on her by the Commission.

3․In his submissions on the substantive application dated 21 June 2024 (the hearing date) the Commissioner indicated that he may be prepared to amend any non-disclosure notices made by him so as to permit the tender of the report for the purposes of the plaintiff’s interlocutory application.  However, those submissions were provided to Ms Cover at the bar table at a point in time when, with respect, it is not reasonable to expect counsel for the plaintiff to have pivoted and presented arguments based on matters he had up to that point considered he was constrained from addressing. 

4․In the result, the issue of costs falls to be determined in the following circumstances.  First, the plaintiff has brought an interlocutory application and has been unsuccessful.  Secondly, however, perhaps unusually, the “prima facie case” test was left to be determined with respect to only part of her claim, namely, that part of the substantive application that alleged jurisdictional error consisting in a denial of procedural fairness (as opposed to error of law on the face of the record).

5․In those circumstances, the plaintiff submits that the costs of her unsuccessful interlocutory application should be the defendant’s costs in the cause. In the alternative, she seeks an order pursuant to rule 1701(2) of the Court Procedures Rules 2006 (ACT) for those costs not to be assessed until the conclusion of the substantive proceedings.

6․The defendant submits that the plaintiff should pay its costs and resists any order for the deferral of those costs. 

7․Both parties referred to authorities which consider the “usual rule” in respect of the costs of an interlocutory application.  The defendant’s submissions referred to the remarks of Young CJ in Eq in Westpoint Finance Pty Ltd v Chocolate Factory Apartments Ltd [2002] NSWCA 287, where his Honour said at [66] to [68]:

Although costs are always in the discretion of the Court and each case is different, the basic guideline to costs on interlocutory applications for an injunction is that where the plaintiff succeeds costs should be costs in the cause, but an unsuccessful plaintiff should pay the costs.

The rationale for the guideline is that as the Court does not evaluate the merits of the dispute, the granting of an interlocutory order merely indicates that the Court has preserved the subject matter of the dispute until the hearing. Those costs were incurred in a necessary step in the overall litigation and should be dealt with in accordance with the final decision. However, if the applicant loses the interlocutory injunction application, the ordinary rule that the loser pays the costs should apply.

There are, of course, many situations where the guideline will not be applied, particularly where the plaintiff has shown an arguable case but the Judge has decided that on the balance of convenience, the interlocutory application should not be granted. In many such cases it is appropriate to order that costs be costs in the cause.

8․The defendant's written submissions referred to other authorities in which that approach has been endorsed, including the decision of the Court of Appeal in His Eminence Metropolitan Petar, Diocesan Bishop of the Macedonian Orthodox Church of Australia and New Zealand v The Macedonian Orthodox Community Church St Petka Incorporated (No 2) [2007] NSWCA 142. Of course, as acknowledged in the remarks of Young J, any “usual rule” is to be regarded as a guideline and must not subvert the application of the broad discretion a court always has as to costs. So much is acknowledged in the Macedonian Orthodox Church decision at [27] to [28]. 

9․In the present case, it is necessary to give careful consideration to the individual circumstances of this case and the proper application of the guidance to be provided by the usual rule.  The first consideration is that the plaintiff faced a high bar because the defendant was under a statutory duty to present the report to the Speaker.  That is probably to be considered as a factor in favour of the defendant in that it indicates that the application was ambitious. 

10․Conversely, it is relevant to have regard to the fact that the plaintiff's task in meeting that high bar was complicated by the confidentiality constraint imposed by the Commission in respect of the draft report.  The defendant submitted that the plaintiff “elected” not to tender the draft report and that she could have sought to do so.  However, as already indicated, I think that is an unrealistic assessment of the circumstances in which counsel for the plaintiff found himself on the morning of the hearing. 

11․In any event, the important consideration is that, as a consequence of the fact that the draft report was not put before me, the alleged legal errors in the report have simply not been assessed by the Court.  It is important in that context to recall that costs are not punitive.  The issue for the Court is to determine what is the relevant “event” so that the Court can properly order that costs should follow the event.  In the present case, the alleged legal errors have simply not been considered and I am in no position to judge what the fate of those arguments might be. 

12․The defendant’s submissions went on to contend that the alleged legal errors are of no avail to the plaintiff in any event.  The difficulty with those submissions, however, is that they assume that any legal error relied upon by the plaintiff must necessarily be non-jurisdictional.  In other words, the submissions treated as a dichotomy the characterisation of jurisdictional error and legal error on the face of the record.  That is not as certain a distinction as the submissions suggested.  There can be legal error which is jurisdictional, particularly where the relevant decision is that of a statutory body of the kind of the ACT Integrity Commission.  For example, the plaintiff contends that the Commissioner applied the wrong test in respect of what was serious corrupt conduct.  If that argument is made good at the final hearing, it may well also be contended that the error is jurisdictional.

13․Even if that is wrong, the defendant’s submissions further assumed that declaratory relief will not be available to the plaintiff or of any utility to her.  Again, that submission proceeded from the premise that certiorari and mandamus are not available in the case of non-jurisdictional error in a report of the kind considered in the present proceedings.  It is not clear to me that declaratory relief will not be available or, indeed, of no utility to the plaintiff in the circumstances of the present case.

14․For example, and I make no assessment about the likelihood of this being the ultimate outcome, if the plaintiff were successful in establishing on a final basis that the Integrity Commission applied the wrong test for what amounted to serious corrupt conduct, that would be a matter in respect of which, notwithstanding the fact that she failed to restrain the presentation of the report to the Speaker, a declaration that she has in effect been wronged would be of substantial utility to her.

15․For those reasons, in my assessment, although the plaintiff was unsuccessful in the interlocutory application, this is a case in which it is appropriate to exercise the Court's discretion to order that the costs be the defendant’s costs in the cause, as contended for on behalf of the plaintiff. 

16․In the circumstances, it is not necessary to consider the interesting question as to the test to be applied by this Court in determining whether to defer the assessment of costs until the conclusion of the proceedings.  I say that is an interesting question because in the Territory, unlike in the State of New South Wales, the default rule is that costs are assessable immediately.  In New South Wales, good reason must be established for requiring a party to pay the costs of a discrete point immediately rather than holding the settling of all costs until the conclusion of the proceedings. 

Orders

17․As I have said, it is not necessary to address that question because I am satisfied that the appropriate order is that the costs of the interlocutory application heard on 21 June 2024, including the costs of the costs argument, should be the defendant's costs in the cause.  Accordingly, I make the following order:

(1)The costs of the plaintiff’s interlocutory application are to be the defendant’s costs in the cause.

I certify that the preceding seventeen [17] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Chief Justice McCallum.

Associate:

Date: