Lewis v Australian Capital Territory (No 2)
[2015] ACTSC 343
•6 November 2015
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Lewis v Australian Capital Territory (No 2) |
Citation: | [2015] ACTSC 343 |
Hearing Dates: | 15 October 2015 then decided on the papers |
Date of Last Submissions: | 28 October 2015 |
DecisionDate: | 6 November 2015 |
Before: | Foster J |
Decision: | See [51] |
Category: | Costs |
Catchwords: | COSTS – Whether the first defendant should pay the plaintiff’s costs on an indemnity basis or on the party/party basis |
Legislation Cited: | Crimes (Sentence Administration) Act 2005 (ACT), s 55 and s 58 Supreme Court Act 1933 (ACT), s 20 and s 37Q Court Procedures Rules 2006 (ACT), rr 40(1)(e), 425(1)(a), 1721(1), 1752(1)(b) and 1752(4) |
Cases Cited: | Lewis v Australian Capital Territory [2015] ACTSC 167 Australian Electoral Commissioner v Towney (No 2) (1994) 54 FCR 383 Whan v McConaghy (1984) 153 CLR 631 |
Parties: | Steven James Lewis (Plaintiff) Australian Capital Territory (First Defendant) Magistrates Court of the Australian Capital Territory (Second Defendant) |
Representation: | Counsel Mr FJ Purnell SC and Dr JS Stellios (Plaintiff) Mr PJF Garrisson SC (Solicitor-General for the Australian Capital Territory) and Mr N Hancock (First Defendant) The Second Defendant submitted |
| Solicitors Ken Cush & Associates (Plaintiff) ACT Government Solicitor (First Defendant) | |
File Number: | SC 514 of 2013 |
Publication Restriction: | No |
Foster J:
Introduction
On 3 July 2015, I delivered the principal judgment in this matter (Lewis v Australian Capital Territory [2015] ACTSC 167) (Lewis No 1). The orders and declarations which I made on that day were in the following terms:
THE COURT:
(1)ORDERS that the Application in Proceeding filed by the first defendant on 28 March 2014 be dismissed.
(2)DECLARES that the sentence of imprisonment imposed upon the plaintiff by the Magistrates Court of the Australian Capital Territory on 24 January 2008 in respect of the plaintiff’s conviction of the offence of recklessly inflicting actual bodily harm to another person on 21 September 2007 has expired.
(3)DECLARES that the periodic detention of the plaintiff ordered on 24 January 2008 in respect of the said sentence has ended.
(4)ORDERS that the plaintiff’s claim for an order that the first defendant pay the costs of proceeding SCA 91 of 2013 in the Court of Appeal of the Australian Capital Territory be refused.
(5)RESERVES for further consideration the question of costs, the question of the plaintiff’s bail and any other consequential relief to be granted to the plaintiff.
At [104] of Lewis No 1, I said:
I propose to order that the first defendant pay the plaintiff’s costs of this proceeding. There is some question as to whether that should be upon the basis of indemnity costs or the ordinary basis. For this reason, I shall reserve the question of costs at the moment and invite the parties to address the question of indemnity costs in due course.
After the judgment in Lewis No 1 was delivered, two questions remained for me to resolve: First, whether I should order the first defendant (ACT) to pay the plaintiff’s costs of and incidental to the proceeding on an indemnity basis rather than on the party/party basis or, alternatively, whether I should order ACT to pay the plaintiff’s costs of the Application in a Proceeding filed by it on 28 March 2014 (the ACT’s strike-out application) on an indemnity basis and the balance of his costs on the party/party basis. Second, whether I should discharge the plaintiff’s bail.
In September 2015, the solicitors for the plaintiff requested that the proceeding be relisted before me for the purpose of having the Court determine the plaintiff’s claims for indemnity costs. In light of that request, the proceeding was relisted before me on 15 October 2015. On that occasion, Senior Counsel for the plaintiff made available a Written Submission in support of his client’s claims for indemnity costs. The Solicitor-General for ACT was not in a position to deal with that submission given the short time that he had had to consider it. I therefore directed a short program for the filing and service of additional Written Submissions and informed the parties that I would deal with the plaintiff’s claims for indemnity costs on the papers.
ACT then filed a Written Submission, as directed. The plaintiff filed a Written Submission in Reply.
By these Reasons for Judgment, I determine the plaintiff’s claims for indemnity costs as against ACT. The second defendant filed a submitting appearance. In light of that fact, the plaintiff did not seek any order for costs against the second defendant.
ACT did not dispute that the plaintiff was entitled to an order for costs. The issue before me was confined to whether some or all of those costs should be ordered to be paid on the party/party basis or on an indemnity basis.
On 15 October 2015, in addition to addressing the question of costs, the plaintiff and ACT agreed that I should make an order discharging the plaintiff’s bail. In light of that agreement, on 15 October 2015, I made an order discharging the plaintiff’s bail.
At [1]–[5] of Lewis No 1, I recorded a number of matters of procedural history. Because those matters are relevant to the application now before me, I set them out again in full:
1.In this proceeding, the plaintiff, Steven James Lewis, seeks a declaration that an imprisonment order and periodic detention order made against him in January 2008 have both expired or, alternatively, an order permanently staying that sentence of imprisonment and associated periodic detention order. He also claims his costs incurred in this proceeding and in a separate ACT Court of Appeal proceeding (SCA 91 of 2013).
2.The plaintiff’s claim for a declaration depends upon the true interpretation of certain provisions in the Crimes (Sentencing) Act2005 (ACT) (Sentencing Act) and the Crimes (Sentence Administration) Act 2005 (ACT) (Administration Act). His claim for a permanent stay raises questions concerning this Court’s powers and jurisdiction as well as discretionary considerations in respect of undisputed facts.
3.When this proceeding was commenced, the only substantive claim made by the plaintiff was for a permanent stay of his sentence. At the hearing before me, I granted leave to the plaintiff to amend his Originating Application so as to add the claim for declaratory relief which he now makes.
4.After the plaintiff commenced this proceeding, the first defendant (ACT) moved to set aside the Originating Application. ACT’s application to set aside was then allocated to me and listed before me.
5.When preparing for the hearing of ACT’s application to set aside the Originating Application, I formed the view that a final hearing of the whole of the plaintiff’s case would not take any longer than a hearing of ACT’s application to set aside and would most probably not require the tender of any additional evidence. For this reason, prior to the hearing, I informed the parties of my view and suggested that the upcoming hearing should proceed as a final hearing of the whole matter. The parties agreed to proceed with the final hearing and not to waste time and money with ACT’s application to set aside. That application will, therefore, be dismissed.
In these Reasons for Judgment I shall adopt the same abbreviations as were used in Lewis No 1. I shall assume that those who read these Reasons for Judgment will also have read my Reasons in Lewis No 1.
One important point to be noted from the above brief history is that, up until the commencement of the hearing before me on 27 October 2014, the only substantive claim made by the plaintiff in this proceeding was for a permanent stay of both the sentence imposed upon him on 24 January 2008 and the related periodic detention order. The claim by the plaintiff that he was entitled to a declaration that the sentence of imprisonment and the periodic detention order made by the Magistrate had both expired was not made at all until 27 October 2014 at the commencement of the hearing before me. Leave to amend to include that claim was granted by me on that occasion. Ultimately, the plaintiff succeeded in persuading me to make appropriate declarations along the lines of the declarations sought by him in his Further Amended Originating Application filed on 27 October 2014.
The plaintiff’s success in securing declaratory relief from the Court rendered otiose his claim for a permanent stay. However, at [98]–[100] of Lewis No 1, I recorded my view that, had it been necessary to do so, I would have granted a permanent stay of the plaintiff’s sentence. I was then, and remain, of the view that the Court has power, in the circumstances of the present case, to grant such a stay. ACT had asserted that the Court did not have jurisdiction or power to grant such a stay.
The Parties’ Arguments in Respect of Indemnity Costs
The Plaintiff’s Submissions in Chief
In his Written Submission dated 15 October 2015, the plaintiff submitted that the disposition of any questions concerning costs was a matter within the discretion of the Court. In support of that proposition, the plaintiff referred to r 1721(1) of the Court Procedures Rules 2006 (ACT) (CPR). As far as his claim for indemnity costs was concerned, the plaintiff relied upon two authorities, namely, Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 (Colgate-Palmolive) (a decision of the Federal Court of Australia) and Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 8) [2008] FCA 1556 (Citrus Queensland) (also a decision of the Federal Court of Australia).
The plaintiff contended that the key considerations for the Court in the present case included:
(a)An assessment by the Court of the circumstances giving rise to the proceeding;
(b)The findings made by the Court in Lewis No 1;
(c)The conduct of the defendants; and
(d)The importance to the plaintiff of protecting his liberty.
As to consideration (a), the plaintiff referred to the procedural history of the proceedings and also to the history of certain related proceedings. He made a chronology available to the Court. The plaintiff submitted that I should take into account the conduct of certain parties related to or connected with ACT in other litigation. For example, the plaintiff referred to and relied upon the allegedly intransigent attitude displayed by the defendants in Lewis v Chief Executive Department of Justice and Community Safety (ACT) (2013) 280 FLR 118 (Lewis v Chief Executive) in adopting and maintaining a position that, in light of the decision of Refshauge J in that case, the question of whether the plaintiff should be returned to full-time imprisonment should be referred back to the Sentence Administration Board (Board).
As to consideration (b), the plaintiff relied upon two critical conclusions reached by me in Lewis No 1. These were:
(a)The reasoning of the High Court in Whan v McConaghy (1984) 153 CLR 631 (Whan) was applicable to the relevant ACT legislation as it applied to the present case. It was submitted that this conclusion was directly contrary to the case propounded on behalf of ACT.
(b)The fact that I would have granted a permanent stay of the plaintiff’s sentence of imprisonment and periodic detention order in any event.
The plaintiff submitted that, at times, the stance adopted by ACT in the present proceeding was “absurd” and “misguided”.
As to consideration (c), the plaintiff submitted that ACT sought to delay and derail the course of the proceedings by filing a misguided application to strike out the plaintiff’s claim upon bases which were plainly incorrect both as a matter of law and of fact. The plaintiff argued that the application filed by ACT to set aside the plaintiff’s Originating Application had virtually no prospect of succeeding and should never have been brought.
As to consideration (d), the plaintiff submitted that he had no option as at November 2013 other than to commence the present proceeding. His submission was that, given that the relevant ACT authorities were seeking to have the decision as to whether or not he should be incarcerated full-time referred back to the Board for further consideration by it, he was obliged to commence the present proceeding.
Finally, the plaintiff contended that the present case was a test case in relation to s 58 of the Administration Act and, for that reason, should result in the plaintiff being awarded costs on an indemnity basis.
ACT’s Submissions
In its Written Submission dated 22 October 2015, ACT also referred to other proceedings involving the plaintiff and ACT or manifestations of ACT. It also gave a brief summary of the history of the present proceeding.
ACT submitted that the usual order as to costs is that costs follow the event. It also argued that a costs order is discretionary and that the usual costs order is subject to exceptions. ACT contended that the guiding principle is that the result must be fair and reasonable in all the circumstances.
ACT accepted that this Court has the power to make an order for indemnity costs where appropriate. It submitted that a party seeking an indemnity costs order carries the onus of satisfying the Court that it should exercise its discretion in favour of making such an order. An indemnity costs order is an order which is more favourable than the usual order as to costs, which is made on the party/party basis. ACT referred to a number of authorities where indemnity costs orders were made as a result of the unreasonable refusal of a settlement offer.
ACT addressed submissions in support of the proposition that s 20 of the Supreme Court Act 1933 (ACT) did not authorise the grant of a permanent stay of a sentence of imprisonment. ACT submitted that not only did its application to set aside the plaintiff’s Originating Application have merit but bringing that application was reasonable in all the circumstances.
ACT also submitted that its conduct of the proceedings generally was not such as to warrant an order for indemnity costs against it. It submitted that my conclusion that the principles expounded by the High Court in Whan applied to the relevant ACT legislation was directly inconsistent with a decision of Refshauge J delivered after Lewis No 1 was heard (Quzag v The Queen (No 2) [2015] ACTCA 10 (Quzag)). ACT submitted that, in Quzag, Refshauge J held that s 58 of the Administration Act had the effect that the sentence was not served and was extended during the period that the offender was on bail and that the principles expounded by the High Court in Whan were not applicable. For this reason, so the submission went, the alleged difference of opinion between Refshauge J and me created a question of significant public interest which plainly rendered reasonable the position adopted by ACT in the present proceeding.
The Plaintiff’s Submissions in Reply
The plaintiff took issue with a number of the submissions made by ACT. In doing so, he reiterated his submissions-in-chief. In particular, he stressed the “test case” submission previously made.
Consideration
Rule 1721(1) CPR provides that the costs of a proceeding or of an application in a proceeding are in the discretion of the Court. The Court’s discretion in respect of costs encompasses a decision as to which party is to pay the costs and also a decision as to the basis upon which such costs are to be paid. Rule 1752(1)(b) is a specific source of power for this Court to order costs on an indemnity basis. Rule 1752(4) prescribes the basis upon which an indemnity costs order will be assessed. The guiding principle for the assessment of indemnity costs is that all costs other than those unreasonably incurred will be allowed. The party liable to pay the costs bears the onus of proving that the costs were unreasonably incurred (r 1752(4)(a) CPR).
An order for indemnity costs is intended to go further than a party/party costs order (Milosevic v Government Insurance Office (NSW) (1993) 31 NSWLR 323 at 334 per Kirby P). Nonetheless, such an order is not meant to be punitive but should remain compensatory and not penal. Usually there must be some special or unusual feature in the case that justifies the Court in departing from the usual position that costs should be ordered to be paid on the party/party basis.
In Colgate-Palmolive, Sheppard J helpfully distilled a number of guidelines for the exercise of the Court’s discretion to award indemnity costs. At 232–234, his Honour said:
1. The problem arises in adversary litigation, ie litigation as between parties at arm’s length. Different considerations apply where parties may be found to be entitled to the payment of their costs out of a fund or assets being administered by or under the control of a trustee, liquidator, receiver or person in a like position, eg a government agency or statutory authority.
2. The ordinary rule is that, where the Court orders the costs of one party to litigation to be paid by another party, the order is for payment of those costs on the party and party basis. In this Court the provisions of O 62, rr 12 and 19, and the Second Schedule to the Rules will apply to the taxation. In many cases the result will be that the amount recovered by the successful party under the Order will fall short of (in many cases well short of) a complete indemnity.
3. This has been the settled practice for centuries in England. It is a practice which is entrenched in Australia. Either legislation (perhaps in the form of an amendment to rules of Court) or a decision of an intermediate court of appeal or of the High Court would be required to alter it. No doubt any consideration of whether there should be any change in the practice would require the resolution of the competing considerations mentioned by Devlin LJ in Berry v British Transport Commission (supra) and Handley JA in Cachia v Hanes (supra) on the one hand and by Rogers J in Qantas on the other. The relevant passages from the respective judgments have been earlier referred to.
4. In consequence of the settled practice which exists, the Court ought not usually make an order for the payment of costs on some basis other than the party and party basis. The circumstances of the case must be such as to warrant the Court in departing from the usual course. That has been the view of all judges dealing with applications for payment of costs on the indemnity or some other basis whether here or in England. The tests have been variously put. The Court of Appeal in Andrews v Barnes (supra) at 141 said the Court had a general and discretionary power to award costs as between solicitor and client “as and when the justice of the case might so require”. Woodward J in Fountain Selected Meats appears to have adopted what was said by Brandon LJ (as he was) in Preston v Preston (supra) at 637; namely, there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. But as French J said (at p 8) in Tetijo, “The categories in which the discretion may be exercised are not closed”. Davies J expressed (at p 6) similar views in Ragata (supra).
5. Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v Weekes (1989) 92 ALR 131 at 152; evidence of particular misconduct that causes loss of time to the Court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp (supra)); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v Hutchinson (1987) 10 NSWLR 525; Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 at 724 (Court of Appeal); Crisp v Keng (unreported, Court of Appeal, NSW, Kirby P, Priestley JA, Cripps JA, No 40744/1992, 27 September 1993) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records (supra)). Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.
6. It remains to say that the existence of particular facts and circumstances capable of warranting the making of an order for payment of costs, for instance, on the indemnity basis, does not mean that judges are necessarily obliged to exercise their discretion to make such an order. The costs are always in the discretion of the trial judge. Provided that discretion is exercised having regard to the applicable principles and the particular circumstances of the instant case its exercise will not be found to have miscarried unless it appears that the order which has been made involves a manifest error or injustice.
The observations made by Sheppard J which I have extracted at [29] above have been frequently accepted and applied in the Federal Court and in other Courts. Those observations constitute a useful list of the considerations which will very often need to be taken into account when a party seeks an indemnity costs order. But, as his Honour said, the categories which call for the exercise of the Court’s discretion in favour of an award of indemnity costs are not closed. The question must always be whether the particular facts and circumstances of the case warrant the making of such an order.
Here, the plaintiff contends that he was driven to commence the present proceeding because ACT took the view that, in light of the decision of Refshauge J in Lewis v Chief Executive, his case should be remitted to the Board for reconsideration according to law. In the event that the plaintiff’s case was remitted to the Board, he would inevitably be at risk that the Board would again revoke his periodic detention order and then order that he be returned to prison full-time. In his submissions to me in respect of indemnity costs, the plaintiff suggested that this potential outcome was the result of ACT’s having lodged a Cross-Appeal from the decision of Refshauge J in Lewis v Chief Executive. He argued that the lodgement of that Cross-Appeal was unreasonable in all the circumstances, given the history of the matter as at late 2014.
The submissions made on behalf of the plaintiff which I have summarised at [31] above are difficult to follow. Before Refshauge J, the plaintiff had argued on constitutional grounds that certain sections of the Administration Act were invalid. He had also sought an order setting aside the Board’s decision made on 8 July 2008 upon the ground that the Board had denied him procedural fairness in relation to that decision. Before Refshauge J, the plaintiff failed in his constitutional challenge to parts of the Administration Act but succeeded in his administrative law attack on the Board’s 8 July 2008 decision. Absent the temporary stay obtained by the plaintiff of the relief granted by Refshauge J (relief which the plaintiff himself had claimed), the remitter of the plaintiff’s case to the Board was inevitable. Remitter to the original decision-maker is the usual consequence of an order setting aside an administrative decision for want of procedural fairness. The potential for the plaintiff to be returned to full-time imprisonment was the direct consequence of his own actions in challenging the Board’s decision in the manner that he did in Lewis v Chief Executive. It had nothing to do with the Cross-Appeal brought by ACT from that decision. By that Cross-Appeal, ACT sought to reinstate the Board’s 8 July 2008 decision. It did not seek a remitter to the Board by its Cross-Appeal. The question of remitter only arose because of the decision of Refshauge J in Lewis v Chief Executive to set aside the Board’s July 2008 decision. The correctness of that decision was challenged by ACT in its Cross-Appeal.
When faced with a constitutional challenge to the validity of various sections of the Administration Act and the ratio of Refshauge J’s decision in Lewis v Chief Executive, it was not unreasonable for ACT to wish to test these matters on appeal.
I do not think that the plaintiff was driven to commence the present proceeding by reason of unreasonable conduct on the part of ACT. Rather, at some point after judgment in Lewis v Chief Executive, the plaintiff appears to have realised that the claims made by him in Lewis v Chief Executive did not assist him to avoid prison. His success on the procedural fairness point exposed him to further action by the Board. By seeking a permanent stay of his sentence and the related periodic detention order and by ultimately seeking declaratory relief, the plaintiff eventually came to grips with the problems confronting him and finally made meaningful claims for relief which should have been made much earlier. He cannot now lay the blame for the consequences of the decision in Lewis v Chief Executive at the feet of ACT. Nor can he say with a straight face that he had to bring the present proceeding because of ACT’s unreasonable conduct in dealing with the claims which he made in Lewis v Chief Executive and in responding to the Court’s decision in respect of those claims.
The views which I have expressed at [31]–[34] above deal with considerations (a), (d) and (c) (in part) identified by the plaintiff in his Written Submission.
As to consideration (b), I do not think that the circumstance that ACT’s arguments were ultimately not accepted by the Court is sufficient to justify an indemnity costs order. More is required. I leave to one side, at the moment, the question of the costs of ACT’s strike-out application. I have already made an order dismissing that application. I will determine the costs of that application separately from the costs order which I intend to make in respect of the proceeding generally.
In my judgment, the plaintiff’s case was not a “test case” within the meaning of the principles explained in such cases as Australian Electoral Commissioner v Towney (No 2) (1994) 54 FCR 383. The plaintiff’s contention that this proceeding was such a “test case” should be rejected. It follows that the consequential submission that indemnity costs should be awarded to the plaintiff because his case was a “test case” should also be rejected.
In light of my decision not to order costs on an indemnity basis in respect of the whole of the proceeding, it is not necessary to address in detail ACT’s submission made by reference to Quzag (as to which, see [25] above). However, I do wish to make a few brief observations about that submission. First, all of the reasoning of Refshauge J in Quzag concerned the consequences of the grant of bail pending appeal. Section 37Q of the Supreme Court Act is engaged only when a convicted person appeals to the ACT Court of Appeal. The remarks made by Refshauge J at [5]–[16] of his Reasons in Quzag were plainly confined to circumstances where an appeal was on foot. His statement at [10] to the effect that Whan was no longer applicable in the ACT was confined to circumstances where s 37Q was engaged. Here, of course, no attempt to appeal against his sentence was made by the plaintiff until after judgment was delivered in Lewis v Chief Executive. By that time, the plaintiff’s sentence had already expired. Second, at [16]–[23] of his Reasons, his Honour held that, by operation of s 37Q, time spent on bail did not count as part of the offender’s term of imprisonment, including any period to be served by periodic detention. His Honour held that a periodic detention order under s 11 of the Sentencing Act is a sentence of imprisonment for the purposes of s 37Q. Third, at [30]–[36], his Honour held that s 58 of the Administration Act was apt to deal with any extension of a sentence after an unsuccessful appeal. His Honour held that the grant of bail is not approval to an offender not to attend to serve periods of periodic detention within the meaning of s 55 of the Administration Act.
At [35], his Honour said:
Thus the periodic detention period is extended once, statutorily, his bail is ended so as to require him to serve the periods which he did not serve because he was on bail.
I think that, at [35] of his Reasons, his Honour was addressing the circumstances obtaining in respect of Mr Quzag as proven in the case before him. I do not think that his Honour’s remark at [35] was intended to have application beyond the facts of the case before him. Those facts included the important circumstance that Mr Quzag had appealed against his sentence. Nor do I think that his Honour’s observation went so far as to constitute an opinion which is contrary to the views expressed by me in Lewis No 1 in relation to s 58 of the Administration Act in Lewis No 1.
For the reasons explained at [38]–[40] above, I do not consider that ACT has demonstrated that there is any relevant difference of opinion between Refshauge J and me as to the correct interpretation of s 58 of the Administration Act. I therefore reject ACT’s submission predicated upon the existence of such a difference of opinion.
It follows from the observations which I have made at [27]–[37] above that I do not consider that an order for indemnity costs in respect of the whole of the present proceeding is warranted. Indeed, as far as the proceeding generally is concerned, I think that the appropriate order is that the plaintiff should have his costs on the party/party basis. That conclusion does not apply to ACT’s strike-out application to which I shall now turn.
ACT’s strike-out application was made under r 40(1)(e) CPR. That rule provides that the Court may set aside an originating process. No criteria for the exercise of the Court’s power under that rule are set out in the CPR. ACT submitted that, in the circumstances of the present case, the Court should apply the jurisprudence developed in respect of the power to strike out a pleading upon the ground that it discloses no reasonable cause of action (as to which, see r 425(1)(a) CPR) to the setting aside exercise called for under r 40(1)(e) CPR. For this reason, ACT submitted that the Court should set aside the plaintiff’s Originating Application because a fair reading of that process did not disclose any reasonable cause of action being brought by the plaintiff.
In support of its strike-out application, ACT submitted that s 20 of the Supreme Court ACT did not provide jurisdiction to the Court to grant a permanent stay of the plaintiff’s sentence and related periodic detention order. In addition, ACT submitted that, although a superior Court has an implied power to stay the enforcement or execution of a sentence where its jurisdiction has otherwise been engaged, the circumstances in which it may do so are confined to a relatively few well-established categories. ACT also submitted that the Human Rights Act 2004 (ACT) was not an appropriate source of jurisdiction and power in respect of the relief claimed by the plaintiff.
The power to strike out a pleading upon the basis that it does not disclose a reasonable cause of action should not be lightly exercised. The pleading will not be struck out on this ground unless the ground is clearly made out. The strike-out applicant must demonstrate that the case sought to be made out is so untenable that it cannot possibly succeed.
In the present case, ACT could never have satisfied these requirements. The plaintiff’s case for a permanent stay was clearly arguable. I have held that it would have succeeded.
In those circumstances, I am of the view that ACT should never have filed its strike-out application. The filing of that application was very likely to lead to the significant waste of time and money. I am not prepared to find that ACT filed that application in order to “delay and derail” the orderly disposition of this proceeding. There is no evidence to support that proposition. Nonetheless, I am comfortably satisfied that the filing of that application added an unnecessary layer to the issues in the case. It had the potential to lead to two hearings covering much the same ground.
In the words of Sheppard J, the strike-out application involved the making of allegations that should never have been made (viz that the Court did not have power to grant a permanent stay of the plaintiff’s sentence and related periodic detention order) and the advancing of contentions which had the capacity to unduly prolong the proceeding and add to the costs thereof.
In my judgment, the conduct of ACT in bringing and maintaining the strike-out application should sound in an indemnity costs order against ACT in respect of that application. Because, on 22 October 2014, I informed the parties that I wished to proceed with a final hearing of the whole proceeding on the following Monday (27 October 2014), I consider that the expenditure of costs on the strike-out application should have ceased at the end of the day on 22 October 2014.
Conclusions
I propose to order ACT to pay the plaintiff’s costs of and incidental to the strike-out application on an indemnity basis. In my view, all of the costs incurred after the Originating Process was filed up to and including 22 October 2014 would be covered by that order. The costs of the balance of the proceeding (including the costs of the hearing before me on 27 October 2014) should be paid on the party/party basis.
The orders of the Court will be:
THE COURT ORDERS THAT:
The first defendant pay the plaintiff’s costs of and incidental to:
(a)The Application in Proceeding filed by the first defendant on 28 March 2014, on an indemnity basis; and
(b)The balance of the proceeding generally, on the party/party basis.
| I certify that the preceding fifty-one [51] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Foster. Associate: Date: 6 November 2015 |
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