FEDERAL COURT OF AUSTRALIA
Lowe v Mack Trucks Australia Pty Limited (No 2) [2008] FCA 711
COSTS – principles relevant to an award of costs – whether Court should depart from the ordinary rule
Federal Court of Australia Act1976 (Cth) s 43
Federal Court Rules (Cth) O 62Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 referred to
Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 referred to
Re Wilcox: Ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151 followed
Abbott v Random House Australia Pty Ltd [1999] FCA 1540 referred to
Hamod v State of New South Wales (2002) 188 ALR 659 followed
Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189 approved
Xat Ky v Australvic Property Management Pty Ltd (No 2) [2007] FCA 1785 referred to
Rosniak v Government Insurance Office (1997) 41 NSWLR 608 referred to
Tetijo Holdings Ltd v Keeprite Australia Pty Ltd [1991] FCA 187 referred toGRAHAM LOWE and ERICA LOWE v MACK TRUCKS AUSTRALIA PTY LIMITED
VID 249 OF 1999
KENNY J
21 MAY 2008
MELBOURNE
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VID 249 OF 1999
BETWEEN:
GRAHAM LOWE
First ApplicantERICA LOWE
Second Applicant
AND:
MACK TRUCKS AUSTRALIA PTY LIMITED
Respondent
JUDGE:
KENNY J
DATE OF ORDER:
21 MAY 2008
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.Save for:
(a) costs thrown away by reason of the abandonment of the two expert witness reports of Dr Arnold McLean filed in September 2004 and in February 2006 respectively; and
(b) the costs incurred by reason of the late discovery of the CD-ROM containing the FORS raw data referred to in [14] of these reasons
the applicants pay the respondent’s costs of and incidental to the proceeding, including reserved costs, on a party and party basis, to be taxed in default of agreement.
2.The applicants pay such of the respondent’s costs as fall within in (a) and (b) in [1] above on an indemnity basis, to be taxed in default of agreement.
3.Upon the expiration of time in which to appeal from my judgment of 4 April 2008 or the determination of any appeal from that judgment (whichever is later), all documents relating to the schematics and/or construction of any vehicle designed and/or manufactured by the respondent which have been provided by the respondent to the applicants in any form whatsoever (whether paper, electronic or otherwise) and any copies of such documents, whether in the possession of the applicants, their legal representatives or witnesses called by them, be returned to the solicitors for the respondent.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VID 249 OF 1999
BETWEEN:
GRAHAM LOWE
First ApplicantERICA LOWE
Second Applicant
AND:
MACK TRUCKS AUSTRALIA PTY LIMITED
Respondent
JUDGE:
KENNY J
DATE:
21 MAY 2008
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
INTRODUCTION
On 4 April 2008, I delivered judgment…
Keep reading for free
Create a free CaseChat account to read Lowe v Mack Trucks Australia Pty Ltd (No 2) and more:
- Read every judgment in full
- Ask AI and get answers linked to paragraphs
- See how each paragraph was cited in later cases
- Download judgments as PDF or Word
One click creates your free account or signs you in.
By continuing you agree to the Terms and Privacy Policy.
- Case
- [2008] FCA 711
- Decision Date
CaseChat Overview and Summary
The legal issues that the court had to resolve were whether the late discovery of data and the preference for one witness's evidence over another justified an indemnity costs order. The applicants argued that the late discovery of data and the preference for one witness's evidence warranted a departure from the usual rule of costs. However, the court found that the delays and the preference for one witness's evidence did not justify a departure from the usual rule of costs following the event. The court also found that the costs incurred in examining the data and conferring with experts and counsel were not sufficient to warrant an indemnity costs order.
The court found that the usual rule of costs following the event should apply, with the successful party receiving costs unless special circumstances warranted a different order. The court found that the circumstances of this case did not warrant a departure from the usual rule of costs following the event. The court also found that the applicants' concession that the data was discoverable and the preference for one witness's evidence did not justify an indemnity costs order. The court concluded that the applicants should pay the respondent's costs of and incidental to the proceeding, including reserved costs, on a party and party basis, except for the costs thrown away by reason of the abandonment of the two expert witness reports of Dr Arnold McLean and the costs incurred by reason of the late discovery of the CD-ROM containing the FORS raw data, which should be paid on an indemnity basis.
In conclusion, the court found that the applicants should pay the respondent's costs of and incidental to the proceeding, including reserved costs, on a party and party basis, except for the costs thrown away by reason of the abandonment of the two expert witness reports of Dr Arnold McLean and the costs incurred by reason of the late discovery of the CD-ROM containing the FORS raw data, which should be paid on an indemnity basis. The court also ordered that all documents relating to the schematics and/or construction of any vehicle designed and/or manufactured by the respondent which have been provided by the respondent to the applicants in any form whatsoever be returned to the solicitors for the respondent upon the expiration of time in which to appeal from the court's judgment or the determination of any appeal from that judgment (whichever is later).
Orders
Orders of the court
1. Save for:
(a) costs thrown away by reason of the abandonment of the two expert witness reports of Dr Arnold McLean filed in September 2004 and in February 2006 respectively; and
(b) the costs incurred by reason of the late discovery of the CD-ROM containing the FORS raw data referred to in [14] of these reasons
the applicants pay the respondent’s costs of and incidental to the proceeding, including reserved costs, on a party and party basis, to be taxed in default of agreement.
2. The applicants pay such of the respondent’s costs as fall within in (a) and (b) in [1] above on an indemnity basis, to be taxed in default of agreement.
3. Upon the expiration of time in which to appeal from my judgment of 4 April 2008 or the determination of any appeal from that judgment (whichever is later), all documents relating to the schematics and/or construction of any vehicle designed and/or manufactured by the respondent which have been provided by the respondent to the applicants in any form whatsoever (whether paper, electronic or otherwise) and any copies of such documents, whether in the possession of the applicants, their legal representatives or witnesses called by them, be returned to the solicitors for the respondent.
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
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Established by: KENNY J
As to this latter submission, the applicants replied, first, that:The preference of the evidence of one witness to another, i.e. Morrison to MacLean [sic] is not such an unusual event as to warrant departure from the usual rule. Whilst acknowledging that portions of MacLean’s [sic] reports and evidence were not proceeded with, that merely achieves a truncated outcome which has saved costs. The alternative may have seen more time utilised in dealing with the evidence of MacLean [sic] with the result that the extended evidence of MacLean [sic] would ultimately have been rejected (given the findings made in respect of his evidence). In those circumstances, a solicitor client costs order would not have been warranted. It follows that by reason of the decision taken at trial to save time, a solicitor/client costs order is not warranted. Further, the applicants “conceded that the FORS data was discoverable”, but said:The production at a late stage however, meant nothing more than the fact that the examination of that data was undertaken at a point in time which interrupted the trial. Costs would have necessarily been incurred in examining the data and conferring with experts and with counsel, regardless of the time when the data was produced. The trial saw many delays occasioned by the availability of witnesses, the production of documents by both sides, the availability of the Court, and the like. Such delays are to be expected in the course of a lengthy trial and do not warrant a departure from the usual rule as to costs. CONSIDERATION By virtue of s 43 of the Federal Court of Australia Act 1976 (Cth), the Court may make orders as to costs. The power, which is discretionary, must be exercised judicially: see Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 234 per Black CJ and French J. Within this general discretion, it is accepted that costs ordinarily follow the event, with the result that a successful litigant receives costs in the absence of special circumstances justifying some other order: see Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 234 per Black CJ and French J. The usual rule is that costs are payable on a party and party basis, unless the circumstances of the case warrant a departure from the normal course: see Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 (“Colgate-Palmolive”) at 233 per Sheppard J and the Federal Court Rules (Cth), O 62. In that case, Sheppard J considered the circumstances in which indemnity costs might be awarded, referring, amongst other things, to “misconduct that causes loss of time to the Court and to other parties” although, as his Honour concluded, “[t]he 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”: see Colgate-Palmolive at 233-234. The Full Court reconsidered the appropriateness of an indemnity costs award in Re Wilcox: Ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151 (“Re Wilcox”) at 152-153 per Black CJ and 156-158 per Cooper and Merkel JJ. In Re Wilcox, at 156-157, Cooper and Merkel JJ reiterated Sheppard J’s approach, saying:In order to exercise the discretion [regarding costs] judicially the following principles have been accepted by the Court as applicable:(a) the Court ought not to depart from the rule that costs be ordered on a party and party basis unless the circumstances of the case warrant the Court in departing from the usual course;(b) the circumstances which may warrant departure from the usual course arise as and when the justice of the case so requires or where there may be some special or unusual feature in the case to justify the court in departing from the usual course;(c) whilst the circumstances in cases in which indemnity costs have been ordered offer a guide, the question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for costs other than on a party and party basis.See also Abbott vRandom House Australia Pty Ltd [1999] FCA 1540 at [5] per Beaumont, Miles and Drummond JJ, quoting the above passage with approval. Even more recently, the Full Court in Hamod v New South Wales (2002) 188 ALR 659 at 665 (per Gray J, with whom Carr and Goldberg JJ agreed) explained the basal principle for an award of indemnity costs in the following terms:Indemnity costs are not designed to punish a party for persisting with a case that turns out to fail. They are not awarded as a means of deterring litigants from putting forward arguments that might be attended by uncertainty. Rather, they serve the purpose of compensating a party fully for costs incurred, as a normal costs order could not be expected to do, when the Court takes the view that it was unreasonable for the party against whom the order is made to have subjected the innocent party to the expenditure of costs.