Nikolic v Nationwide News Pty Ltd
[2025] VSCA 112
•23 May 2025
| SUPREME COURT OF VICTORIA COURT OF APPEAL |
| S EAPCI 2024 0086 |
| GORAN NIKOLIC | First Applicant |
| IDAZ09 PTY LTD | Second Applicant |
| v | |
| NATIONWIDE NEWS PTY LIMITED TRADING AS THE AUSTRALIAN | Respondent |
| S EAPCI 2024 0087 |
| GORAN NIKOLIC | First Applicant |
| IDAZ09 PTY LTD | Second Applicant |
| v | |
| TWITTER INTERNATIONAL COMPANY (X CORP INC) | Respondent |
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| JUDGE: | BEACH JA |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | On the papers |
| DATE OF JUDGMENT: | 23 May 2025 |
| MEDIUM NEUTRAL CITATION: | [2025] VSCA 112 |
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COSTS – Costs of manifestly hopeless applications for leave to appeal – Costs of applications for leave to appeal in which applicants made baseless allegations of misconduct against respondents and their lawyers – No reason costs should not follow the event – Respondents entitled to indemnity costs – Respondents entitled to awards of costs on gross sum basis in order to avoid expense, delay and aggravation involved in taxation.
Supreme Court (General Civil Procedure) Rules 2015, rr 63.07, 63.28, 63.30 and 63.30.1.
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| Counsel | ||
| Applicants: | In person | |
| Respondent (Nationwide): | Mr A Anderson | |
| Respondent (Twitter): | ||
| Solicitors | ||
| Applicants: | ||
| Respondent (Nationwide): | Thomson Geer | |
| Respondent (Twitter): | Thomson Geer | |
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BEACH JA:
Goran Nikolic and IDAZ09 Pty Ltd were the plaintiffs in two proceedings in the Trial Division. The first proceeding was against Nationwide News Pty Ltd (‘Nationwide proceeding’), and the second proceeding against Twitter International Company (‘Twitter proceeding’) (collectively, ‘proceedings’). In the Trial Division, the proceedings were determined adversely to the plaintiffs.[1]
[1]Nikolic v Nationwide News Pty Ltd [2020] VSC 98 (Daly AsJ); Nikolic v Nationwide News Pty Ltd [2024] VSC 380 (Gray J); Nikolic v Twitter International Company [2024] VSC 381 (Gray J).
On 16 April 2025, this Court made orders refusing the plaintiffs’ leave to appeal in both proceedings. In each case, the Court determined that the application for leave to appeal was totally without merit within the meaning of s 14D(3) of the Supreme Court Act 1986.[2] Orders were also made in each of the proceedings for the filing and serving of material and submissions in relation to the costs of and incidental to the applications for leave to appeal.
[2]Nikolic v Nationwide News Pty Ltd [2025] VSCA 79 (‘Nationwide (CA)’); Nikolic v Twitter International Company [2025] VSCA 80 (‘Twitter (CA)’).
Pursuant to those orders, on 30 April 2025:
(a)in the Nationwide proceeding, Nationwide filed and served an affidavit (‘the Nationwide affidavit’) sworn by its solicitor, Justin Quill, and written submissions on the costs of the application for leave to appeal in relation to the Nationwide proceeding; and
(b)in the Twitter proceeding, Twitter filed and served an affidavit (‘the Twitter affidavit’) sworn by its solicitor, Mr Quill,[3] and written submissions on the costs of the application for leave to appeal in relation to the Twitter proceeding.
[3]Mr Quill’s firm acting for both Nationwide in the Nationwide proceeding, and Twitter in the Twitter proceeding.
In short, in each proceeding, the defendant (Nationwide in the Nationwide proceeding, and Twitter in the Twitter proceeding) seeks the costs of and incidental to the application for leave to appeal to be paid by the plaintiffs on the indemnity basis, and for those costs to be fixed in a gross sum.
In the Nationwide proceeding, Nationwide seeks its costs to be fixed in the gross sum of $62,904.66; alternatively, ‘a gross sum fixed in an amount the Court considers appropriate’. In the Twitter proceeding, Twitter seeks its costs to be fixed in the gross sum of $53,697.99; alternatively, ‘a gross sum fixed in an amount the Court considers appropriate’.
In contrast to the approach taken by Nationwide and Twitter, following the publication of Nationwide (CA) and Twitter (CA), Mr Nikolic has sent a number of emails to the Court in which he has expressed his ‘serious concern and deep dissatisfaction’ with Nationwide (CA) and ‘profound concern and unequivocal dissatisfaction’ with Twitter (CA).
Additionally, notwithstanding that his applications for leave to appeal to this Court have been determined against him and IDAZ09 and that the orders made on 16 April 2025 have been authenticated, Mr Nikolic has sought to file material in this Court seeking to reopen and or review the now dismissed applications for leave to appeal. As is obvious, however, such attempts as the plaintiffs continue to make to reopen the applications for leave to appeal in this Court are misconceived. There is no basis upon which this Court could grant them.
In any event, on 6 May 2025, the plaintiffs filed two sets of submissions (‘the plaintiffs’ costs submissions in Nationwide’ and ‘the plaintiffs’ costs submissions in Twitter’) (collectively, ‘the plaintiffs’ costs submissions’), which were expressed to have been filed pursuant to the orders of this Court made on 16 April 2025.
In the plaintiffs’ costs submissions, the plaintiffs continued to take issue with the dismissal of their applications for leave to appeal. That said, on the question of costs they submitted:
(a)in the Nationwide proceeding, Nationwide had engaged in misconduct which disentitled it to a discretionary order for costs in its favour; and that the proper order was that there should be no order as to costs, or that each party should bear their own costs; and
(b)in the Twitter proceeding, Twitter had engaged in misconduct which disentitled it to the discretion of the Court as to costs; and that each party should bear their own costs, or that there should be no order as to costs made in Twitter’s favour.
Costs issues to be determined
On the material filed by the parties, the following issues fall to be determined in relation to costs in each proceeding:
(a)whether there should be an order made against the plaintiffs that they pay the relevant defendant’s costs of and incidental to the application for leave to appeal;
(b)if costs are to be ordered against the plaintiffs, whether such costs should be ordered to be taxed on the standard basis or the indemnity basis;
(c)whether any costs order made against the plaintiffs should be fixed on a gross sum basis; and
(d)if costs are to be fixed on a gross sum basis, the amount in which any gross sum costs order should be fixed.
The relevant costs rules
Before proceeding further, it is necessary to identify the relevant rules dealing with gross costs orders and the bases upon which costs may be ordered to be taxed.
Rule 63.07 of the Supreme Court (General Civil Procedure) Rules 2015 deals with orders for the payment of taxed costs and makes provision for the ordering of a gross sum instead of taxed costs. Specifically, r 63.07 provides:
63.07 Taxed or other costs provision
(1)Subject to this Order, where by or under these Rules or any order of the Court costs are to be paid to a party, that party shall be entitled to taxed costs.
(2)Where the Court orders that costs be paid to a party, the Court may then or thereafter order that as to the whole or any part of the costs specified in the order, instead of taxed costs, that party shall be entitled to—
(a)a portion specified in the order of taxed costs;
(b)taxed costs from or up to a stage of the proceeding specified in the order;
(c)a gross sum specified in the order instead of taxed costs;
(d)a sum in respect of costs to be determined in such manner as the Court directs.
(3)Unless the Court otherwise orders, the Costs Court may order a gross sum in lieu of taxed costs—
(a)on application by any party; or
(b)on its own motion.
Rule 63.28 identifies three bases upon which costs may be taxed:
(a)the standard basis;
(b)the indemnity basis; or
(c)such other basis as the Court may direct.
‘The standard basis’ and ‘the indemnity basis’ are then described in rr 63.30 and 63.30.1 as follows:
63.30 Standard basis
On a taxation on the standard basis, all costs reasonably incurred and of reasonable amount shall be allowed.
63.30.1 Indemnity basis
(1)Subject to paragraph (2), on a taxation on the indemnity basis all costs shall be allowed except in so far as they are of an unreasonable amount or have been unreasonably incurred.
(2)Any doubt which the Costs Court may have as to whether the costs were unreasonably incurred or were unreasonable in amount shall be resolved in favour of the party to whom the costs are payable.
Defendants’ costs submissions in more detail
In each proceeding, the defendant submitted that costs should follow the event, and thus that each defendant was entitled to an order that the plaintiffs pay their costs of and incidental to the applications for leave to appeal.
Having made those submissions, the defendants submitted that the costs orders to be made against the plaintiffs should be made on the indemnity basis. While the reasons for making costs orders on the indemnity basis were expressed differently in each defendant’s submissions, in summary, the reasons advanced by the defendants were a combination of the following matters:
(a)the proposed appeal in each case had no prospects of success and was totally without merit;
(b)the plaintiffs were ‘on notice’ that the arguments advanced by them were ‘doomed to fail and without proper basis’; and
(c)the plaintiffs made, and continue to make, ‘serious and baseless allegations of misconduct’ in their applications.
While the defendants relied upon a number of authorities supporting the proposition that indemnity costs could be awarded in the circumstances upon which they relied, Nationwide made specific reference to the often-cited passage of Woodward J’s judgment in Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd,[4] as follows:
I believe that it is appropriate to consider awarding ‘solicitor and client’ or ‘indemnity’ costs, whenever it appears that an action has been commenced or continued in circumstances where the applicant, properly advised, should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law. Such cases are, fortunately, rare. But when they occur, the court will need to consider how it should exercise its unfettered discretion.[5]
[4](1988) 81 ALR 397 (‘Fountain Selected Meats’).
[5]Ibid 401.
As to the making of gross sum costs orders, each defendant submitted that the plaintiffs had been wholly unsuccessful against them, and that it was ‘manifestly reasonable and fair’ that a gross sum costs order should be made. The defendants contended that gross sum costs orders would ‘avoid the expense, delay and aggravation of taxation, and [were] consistent with the overarching purpose in s 8 [of the Civil Procedure Act 2010] and the Court’s power to further the overarching purpose in s 9 [of that Act]’.
The amount claimed by Nationwide
Nationwide claimed a gross sum of $62,904.66, which was said to represent 85 per cent of Nationwide’s costs and disbursements in this Court. Nationwide’s affidavit in support of its claim disclosed that work was done in the defence of the plaintiffs’ claim against Nationwide by:
•a partner who charged $775 per hour (‘the partner’);
•a senior associate who was billed out at the rate of $635 per hour (‘the senior associate’);
•an associate who was billed out at the rate of $425 per hour (‘the associate’);
•a senior paralegal who was billed out at the rate of $340 per hour (‘the senior paralegal’); and
•a member of junior counsel who charged $550 per hour (‘the barrister’ or ‘counsel’).[6]
[6]All of these hourly rates were expressed to be exclusive of GST.
Exhibited to the Nationwide affidavit was a table containing 96 entries which set out the date upon which work was done, the fee earner, a summary of the work performed, the time billed and the fees billed (exclusive of GST). For ease of reference, that table may be summarised as follows:
Fee Earner
Hourly Rate
Total Hours
Fees Billed
The partner
$775
11.6
$8,990.00
The senior associate
$635
44.7
$28,384.50
The associate
$425
29.9
$12,707.50
The senior paralegal
$340
0.4
$136.00
Counsel
$550
43.25
$23,787.50
Total:
129.85
$74,005.50
The amount claimed by Twitter
Twitter claimed a gross sum of $53,697.99, which was said to represent 85 per cent of Twitter’s ‘raw costs’ in this Court. Twitter’s affidavit in support of its claim disclosed that work was done in the defence of the plaintiffs’ claim against Twitter by:
•the partner, who this time charged $752.25 per hour;
•the senior associate, who this time was billed out at the rate of $667.25 per hour;
•the associate, who this time was billed out at $442 per hour; and
•the senior paralegal, who this time was billed out at $357 per hour.[7]
[7]Again, all of the hourly rates were expressed to be exclusive of GST. No explanation was given in any of the material filed by Nationwide or Twitter as to why the same people charged and/or were billed at different rates in the two proceedings.
Exhibited to the Twitter affidavit was a table containing 70 entries which set out the date upon which work was done, the fee earner, a summary of the work performed, the time billed and the fees billed (exclusive of GST). For ease of reference, that table may be summarised as follows:
Fee Earner
Hourly Rate
Total Hours
Fees Billed
The partner
$752.25
14.6
$10,982.85
The senior associate
$667.25
43.9
$29,292.27
The associate
$442.00
51
$22,542.00
The senior paralegal
$357.00
0.4
$142.80
Total:
109.9
$62,959.92[8]
[8]While this total is $214.18 less than the total in Twitter’s table, I do not pause here to determine which of the 70 lines in the table might contain an incorrect calculation, other than to identify the following examples. In line 41 of the table, where the associate is said to have worked for 0.8 hours, the amount of $733.98 is claimed. In a number of other lines of the table dealing with charges billed for the associate, the amounts billed are not the product of multiplying the time said to have been billed by the specified hourly rate (in those lines, an hourly rate of $454.75 appears to have been used: see for example, line 9).
Plaintiffs’ costs submissions in more detail
In additional to dealing with the issue of costs, the plaintiffs’ costs submissions deal with a number of other matters. Specifically, the plaintiffs’ costs submissions in Nationwide deal with ‘Why special leave should be granted’, ‘The public importance of the questions raised’, and something called the ‘Violation of DZY principle’, which was said to be based on a decision asserted to have been made in a case called ‘DZY v State of Victoria [2020] VSC 613’.[9]
[9]I do not pause to consider this alleged authority, which does not appear to exist in reality. The decision of the Supreme Court with the medium neutral citation [2020] VSC 613 is the decision of McMillan J in Re Condo; Marinucci v Condo; and the only decision involving a party named DZY is DZY v Trustees of the Christian Brothers [2023] VSC 124, which decision was reversed on appeal in Trustees of the Christian Brothers v DZY [2024] VSCA 73, which reversal was affirmed by the High Court in DZY v Trustees of the Christian Brothers [2025] HCA 16.
Whereas, in the plaintiffs’ costs submissions in Twitter, in addition to making submissions about costs, the plaintiffs make other submissions under the headings ‘Denial of Reasonable Adjustments and Jurisdictional Error’, ‘Conflict of Interest and Settlement Procured Through Compromised Representation’, ‘Algorithmic Amplification and Active Publication’, and ‘Cumulative Miscarriage of Justice’.
Returning to relevant matters, in the plaintiffs’ costs submissions in the Nationwide proceeding, the plaintiffs submitted that Nationwide ought not be awarded costs. They submitted that Nationwide had engaged in misconduct when it:
•opposed the provision of reasonable adjustments to a profoundly deaf and psychologically vulnerable litigant;
•relied on unverified affidavit material which denied involvement in the configuration of the Google Custom Search Engine, which was later shown to be false;
•failed to verify the evidence contrary to ss 41 – 42 of the Civil Procedure Act 2010;
•failed to disclose relevant technical configuration data material to the fairness and enforceability of the settlement agreement; and
•dismissed legitimate complaints of evidentiary misconduct as ‘misconceived’ without investigation.
The plaintiffs submitted that this conduct ‘materially contributed to the outcome below and to the denial of procedural fairness’; and that it also ‘rendered the enforcement of the settlement [with Nationwide] unsafe and inconsistent with public policy and equitable principle’. The plaintiffs submitted that, in all the circumstances, Nationwide’s conduct disentitled it to any discretionary costs order in its favour, with the proper order being that there should be no order as to costs; alternatively, that each party should bear their own costs of the Nationwide proceeding.
In the plaintiffs’ costs submissions in the Twitter proceeding, the plaintiffs submitted that Twitter ought not be awarded costs. They submitted that Twitter had committed ‘serious breaches of duty, procedural fairness, and professional obligation’ when it:
•procured a settlement agreement while [Mr Nikolic] was profoundly deaf, psychologically unwell, and denied access to communication adjustments;
•was represented by a solicitor, Mr Quill, who had previously acted for [Mr Nikolic] and whose continuing role gave rise to a disqualifying conflict of interest;
•failed to disclose critical material facts — namely, the operation of algorithmic systems that would continue to associate defamatory content with [the plaintiffs’] names post-settlement;
•unilaterally disclosed the terms of the confidential [settlement] agreement to the Supreme Court, in breach of the confidentiality obligations; and
•characterised [Mr Nikolic’s] submissions as ‘unintelligible’, while contributing to that state by opposing any reasonable adjustments for his disability.
The plaintiffs submitted that these matters ‘go to the heart of the integrity of the proceeding and render it unjust to permit [Twitter] to recover costs’. The plaintiffs submitted that, in all the circumstances, Twitter’s conduct disentitled it to the discretion of the Court as to costs, and that each party should bear their own costs; alternatively, that no order as to costs be made in Twitter’s favour.
While the plaintiffs made submissions in both proceedings that there should be no order for costs made against them, they did not make any submissions about whether (if costs orders were to be made against them) gross sum costs orders should be made. Nor did they make any submissions about the quantum of any gross costs orders that might be made against them. In the circumstances, I will take them to oppose not only the making of any orders for costs against them, but also the making of gross sum costs orders as well as opposing every line of the claims made by Nationwide and Twitter as itemised in the Nationwide and Twitter affidavits.
Plaintiffs’ allegation of misconduct
The plaintiffs’ allegations of misconduct are relevant in two ways: first, the plaintiffs rely upon them as reasons for denying Nationwide and Twitter their costs of the applications for leave to appeal; and secondly, Nationwide and Twitter assert that they were made without any proper foundation, and are thus a reason why Nationwide and Twitter should get their costs taxed on the indemnity basis.
By way of introduction to these issues, I should make the following observations:
(1)Some of the plaintiffs’ allegations of misconduct are not easy to follow. While some are very specific, others are made at such a high level of generality as to be of little assistance. For example, quite what was encompassed by the plaintiffs’ assertion that Nationwide ‘opposed the provision of reasonable adjustments to a profoundly deaf and psychologically vulnerable litigant’ was not made clear by the plaintiffs.[10]
(2)While the plaintiffs plainly take issue with what they regard as important parts of the affidavit evidence and/or other material filed in each proceeding, some of the allegations of misconduct in relation to these documents lacks specificity. For example, one cannot find anywhere in the material an allegation that paragraph X of affidavit Y was false because of A, and the deponent of the affidavit knew it to be false because of B.
(3)It is relatively common in hard fought litigation for each side to disagree with some aspect of an affidavit (or affidavit evidence) relied upon by their opponent. Often matters in dispute are contestable. Sometimes, one side’s assertion in an affidavit can be shown to be false. However, demonstrating that something in an affidavit is false is not the equivalent of establishing the existence of any relevant misconduct. At the very least, it would also need to be established (and not merely asserted) that the deponent of the relevant affidavit knew or ought to have known that what they had sworn was false in some material respect because of some relevant circumstance.
(4)Allegations by one party that another party’s application or submissions are ‘misconceived’ is also a relatively common thing in hard-fought litigation. The same can be said of assertions that pleadings or submissions are ‘unintelligible’ or ‘incoherent’ or otherwise defective. The making of such allegations (or the use of such labels) will, after analysis in an individual case, be found to be correct or not. However, the making of such submissions (and/or the use of such labels) cannot, without more, amount to any form of relevant misconduct.
[10]One might ask rhetorically: ‘What were these adjustments? When, and by what means, were these adjustments opposed by Nationwide, and in what circumstances were they opposed? What knowledge of Mr Nikolic’s alleged psychological vulnerability is it asserted that Nationwide possessed? When, and by what means, did Nationwide acquire this knowledge?’
Having examined all of the plaintiffs’ complaints of misconduct alleged against Nationwide, and all of their complaints of misconduct alleged against Twitter, I have concluded that there is no substance in any of them. Nothing in the material in either of the proceedings suggests that either of the defendants (Nationwide or Twitter) or their lawyers engaged in any conduct which might disentitle Nationwide or Twitter to an order for costs in this Court. The plaintiffs allegations of misconduct in each case are without substance.
That said, I would make the following additional observations:
(1)While the plaintiffs submitted that Nationwide’s misconduct rendered the enforcement of their settlement with it unsafe, it is to be remembered that, in the Nationwide proceeding, the application the plaintiffs made to Gray J was for an extension of time within which to appeal the orders made by Daly AsJ. The issue his Honour was required to deal with was whether Daly AsJ’s orders were affected by error — not whether the enforcement of the subsequent settlement agreement had been rendered unsafe as is now suggested.
(2)Notwithstanding the plaintiffs’ current complaints about Mr Nikolic’s position at the time the settlement agreement was entered into between Twitter and the plaintiffs, it is to be remembered that that settlement agreement was entered into at a time when the plaintiffs were represented by a firm of solicitors. Moreover, the complaints the plaintiffs now make about the ‘procuring of the settlement agreement’ by Twitter and/or its lawyers while Mr Nikolic was psychologically unwell did not form any part of their original application to set aside the consent orders made by Baker JR.[11] Nothing in the material filed in the Twitter proceeding supports the notion that Twitter or its lawyers engaged in any form of misconduct by procuring or entering into the Twitter settlement agreement.
(3)The question of whether either Nationwide or Twitter should have disclosed the operation of the algorithmic systems referred to by the plaintiffs, and/or sworn some other and what affidavit about any involvement in the configuration of the Google Custom Search Engine, is heavily contestable. The allegations made by the plaintiffs in relation to these issues do not form any basis upon which a finding of misconduct could be made against Nationwide or Twitter or any of their lawyers in either proceeding.
[11]See the plaintiffs’ outline of submissions filed on 27/12/23 12:25 pm; plaintiffs’ submissions in response to the defendant’s submissions filed on 11/02/2024 10:59 am; plaintiffs’ further submissions in response to the defendant’s submissions filed on 05/04/2024 01:02 am; and the affidavit of Mr Nikolic, sworn or affirmed on 10 February 2024, filed on 11/02/2024 10:59 am.
Next, as best I can tell, the allegation the plaintiffs now make about Mr Quill having a conflict of interest in acting in the Twitter proceeding is not one that has been made before. No detail was provided by the plaintiffs as to the circumstances of Mr Quill’s previous engagement and the plaintiffs have not directed me to any material they filed at first instance in which they made any complaint about the conflict of interest they now allege. Nor did the plaintiffs provide any evidence[12] in support of this new allegation. In the circumstances, this alleged conflict of interest cannot form any basis upon which this Court could make a relevant finding of misconduct. If it were thought that Mr Quill had some conflict in acting for Twitter, then it was incumbent on the plaintiffs to raise that issue before Gray J and to make some application to restrain Mr Quill from continuing to act. In any event, I note that in an affidavit in reply, sworn by Mr Quill in the Twitter proceeding on 21 May 2025, Mr Quill specifically denied ever acting for Mr Nikolic or IDAZ09, or ever having taken instructions from Mr Nikolic or anyone on behalf of IDAZ09.[13]
[12]Having regard to the seriousness of these allegations, one might have expected the plaintiff to provide some particulars of them and to exhibit letters, bills or other documentary evidence in support of the allegations.
[13]Indeed, on Mr Quill’s reply affidavit, the material in paragraphs 7, 9 and 10 of the plaintiffs’ costs submissions in Twitter is pure fiction. As to which, see n 9 above and paragraphs [36]–[39] below.
In short, the plaintiffs’ allegations of misconduct made against Nationwide, Twitter and their lawyers in this Court are without foundation. Serious allegations of misconduct have to be proved to the reasonable satisfaction of a court. As has been said before, ‘such … “reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect inferences’.[14] In the present cases, there is nothing in the material that could establish to the reasonable satisfaction of a court that any of the parties against whom the plaintiffs make allegations have engaged in any misconduct.
[14]Briginshaw v Briginshaw (1938) 60 CLR 336, 362 (Dixon J).
Should a costs order be made against the plaintiffs?
Before answering the question of whether costs orders should be made against the plaintiffs in these proceedings, I should make reference to another feature of the plaintiffs’ costs submissions. In footnote 9 above, I noted that the decision DZY v State of Victoria [2020] VSC 613, cited by the plaintiffs, does not exist. In resisting orders for costs, the plaintiffs cited two further decisions which do not appear to exist. These were said to be Melbourne City Investments Pty Limited v Treasury Wine Estates Limited(No 5) [2017] VSC 216, [35] (Elliot J); and R v Smith (1983) 1 VR 665, 668 (Marks J).
In fact, more specifically, there does not appear to be any decision of this Court called Melbourne City Investments Pty Ltd v Treasury Wine Estates Limited (No 5); and the decision of this Court with the medium neutral citation [2017] VSC 216 is a decision of Derham AsJ in a matter of DLA Piper Australia v Official Receiver of Singapore.[15]
[15]Moreover, Derham AsJ’s judgment only contains 25 paragraphs. There is no para [35].
While the plaintiffs cite the alleged R v Smith decision of Marks J for a proposition that a court is entitled to deprive a party of its costs if that party has acted unethically or improperly in the conduct of the litigation (a proposition which may be accepted as a matter of generality), it is unlikely (to say the least) that such a statement was made by his Honour in the course of what appears would have been a criminal proceeding which would have been decided (if it existed) before the High Court’s decision in Latoudis v Casey.[16] That said, and for completeness, I note that the case actually reported at [1983] 1 VR 665 and 668 (being the citation relied upon by the plaintiffs) is in fact the Full Court decision of Karenlee Nominees Pty Ltd v Gollin & Co Ltd[17] — a decision which has nothing to do with the costs of litigation or any of the issues in this case.
[16](1990) 170 CLR 534.
[17][1983] 1 VR 657.
Having been unable to find copies of the two decisions relied upon by the plaintiffs, the Registry asked the plaintiffs for copies of them. The first response given by the plaintiffs was largely non-responsive and appeared to be AI-generated. The second response given by the plaintiffs was no more helpful.[18] In the end, the only conclusion I can reach is that, like DZY v State of Victoria, these two decisions do not exist in the real world. They are most probably ‘hallucinations’ of the kind referred to in paragraph 7(a) of the New South Wales Supreme Court Practice Note SC Gen 23, which deals with the use of generative artificial intelligence (Gen AI) in that Court.
[18]The registry request and Mr Nikolic’s responses occurred in an email exchange between the Registry and Mr Nikolic on 9 May 2025. Mr Nikolic’s first response was sent at 12:49 pm, and his second at 1:34 pm.
I turn now to the question of whether the plaintiffs should be ordered to pay the costs of Nationwide and Twitter of their applications for leave to appeal in this Court. The short answer is that they should be ordered to pay the costs of both proceedings.
In short, there is no reason why costs should not follow the event in each case. While the plaintiffs flirted with submissions that the proceedings were public interest litigation, there is in fact no substance in those submissions. In truth, these proceedings were, and always have been, hard fought proceedings in which the plaintiffs have prosecuted matters affecting them alone. Nothing in the subject matter of the proceedings or in any other aspect of the proceedings persuades me that the usual position (or, to use the words of Kirby J in Oshlack v Richmond River Council,[19] ‘ordinary rule’) of costs following the event should not be the position so far as each of these cases is concerned.
[19](1998) 193 CLR 72, 115 [120].
Further, all of the plaintiffs’ allegations of misconduct made against Nationwide, Twitter and their lawyers were, and are, without foundation. Neither defendant nor any of their lawyers have been shown to have engaged in any conduct which might disentitle either defendant to an order that the plaintiffs pay each defendant’s costs of and incidental to the relevant application for leave to appeal in which that defendant was a respondent.
It follows that there should be an order, in each case, that the plaintiffs (applicants) pay the defendant’s (respondent’s) costs of and incidental to the application for leave to appeal.
Should the costs orders be made on the standard basis or on the indemnity basis?
Properly advised, the plaintiffs should have known that neither of their applications for leave to appeal to this Court had any chance of success. That being the case, the applications for leave to appeal must be presumed to have been commenced and continued ‘for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law’.[20]
[20]Fountain Selected Meats (1988) 81 ALR 397, 401.
While the commencement or continuance of proceedings ‘in wilful disregard of known facts or clearly established law’ is a basis for awarding indemnity costs,[21] as French J said in J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (No 2):
It is not a necessary condition of the power to award such costs that a collateral purpose or some species of fraud be established. It is sufficient, in my opinion, to enliven the discretion to award such costs that, for whatever reason, a party persists in what should on proper consideration be seen to be a hopeless case.[22]
[21]Ibid.
[22](1993) 46 IR 301, 307; [1993] FCA 70.
The plaintiffs’ application for leave to appeal in each of the proceedings was manifestly hopeless. The commencement and continuance of manifestly hopeless applications for leave to appeal was exacerbated by the plaintiffs’ failure to focus accurately on the real issues in each case. By taking the course they did, they made each application much longer and much more expensive than each application should have otherwise been.[23] Having considered what this Court said in Macedon Ranges,[24] and particularly what was said at paragraphs [16]–[18] and [25] and in the authorities referred to in those paragraphs, I have nevertheless come to the view that Nationwide and Twitter should have their costs of and incidental to the applications for leave to appeal on the indemnity basis. I am fortified in this conclusion by the continued making by the plaintiffs of baseless allegations of misconduct against the defendants and their lawyers.
[23]See Vink v Tuckwell (No 3) [2008] VSC 316, [104]; Macedon Ranges Shire Council v Thompson [2009] VSCA 209, [17] (‘Macedon Ranges’).
[24][2009] VSCA 209.
In short, I have concluded that Nationwide and Twitter should have their costs on the indemnity basis because the plaintiffs’ applications for leave to appeal were manifestly hopeless. Moreover, the plaintiffs were on notice that the arguments they advanced were doomed to fail and, despite that, they continued to persist with them, and to make serious and baseless allegations of misconduct against the defendants and their lawyers — which allegations could not, in any event, affect the correctness of the decisions they sought to impugn.
Should gross sums be ordered instead of taxed costs?
The Court may award a gross sum instead of taxed costs in order to avoid the expense, delay and aggravation involved in a taxation or in protracted litigation that might arise out of a taxation.[25] That said, awarding a gross sum instead of taxed costs involves the Court taking a broad brush approach, without the rigour and precision of the processes of taxation. In taking that course, however, the Court needs to be confident that the approach taken to the estimate of costs is logical, fair and reasonable.[26]
[25]Giurina v Greater Geelong City Council [2021] VSCA 341, [16] (Kennedy and Walker JJA, Macaulay AJA) (‘Giurina’).
[26]Ibid.
The history of these proceedings (both the Nationwide proceeding and the Twitter proceeding) shows that the plaintiffs will not accept that their cases have been decided against them. As they have done so in this Court since the delivery of judgment in each case on 16 April 2025, it is highly likely that they will continue to file affidavits and submissions (and to send emails) cavilling with the correctness of the decisions that have been made against them. Indeed, in the last week alone, Mr Nikolic has sent no less than 30 emails to the Court cavilling with the decisions which have been made against the plaintiffs and/or seeking to have them set aside.[27]
[27]By way of example, at 7:13 pm last night, Mr Nikolic sent an email again alleging that there has been ‘serious and ongoing disability discrimination, procedural misconduct and institutional neglect’ by the Court in the handling of the proceedings. The email appears to have been copied to dozens of court houses around Australia as well as various Government Houses (amongst others), suggesting that the plaintiffs are not likely to give up disputing the decisions made against them anytime soon.
If orders for taxed costs were made in favour of the defendants, there is every reason to believe that those taxations would become mired in disputes about the correctness of the decisions that have led to the making of orders requiring the plaintiffs to pay the defendants’ taxed costs. One could then expect multiple reviews and attempts to appeal any taxation result with which the plaintiffs might not be satisfied (either on the basis of some argument about the legitimacy of the taxation or, more likely, on the basis that one or more of the judicial officers who have made decisions adverse to the plaintiffs have erred or themselves engaged in some form of vitiating misconduct). Indeed, the plaintiffs’ latest attempt to file applications to set aside the substantive orders dismissing their applications for leave to appeal was made by an email sent by Mr Nikolic at 9.35 am this morning, with a follow up email sent at 9:59 am (copied to 217 email addresses).
In the circumstances, the plaintiffs’ conduct to date tells heavily in favour of the making of gross sum costs orders. The defendants have identified their total raw costs. In each case, the relevant defendant seeks 85 per cent of its raw costs, or ‘an amount the Court considers appropriate’.
On their face, Nationwide’s raw costs of and incidental to the plaintiffs’ application for leave to appeal appear high in circumstances where there has been no oral hearing. While Twitter’s raw costs are lower in amount in respect of the application for leave to appeal commenced against it, Twitter’s costs similarly appear to be high for a case where there has been no oral hearing. The issue in each case is the number of hours in total that the relevant fee earners worked in the defence of the relevant application for leave to appeal. In my view, there is no issue about the reasonableness of the relevant hourly rates charged or billed in relation to the fee earners.[28]
[28]Notwithstanding that an hourly rate different from that identified in the Twitter affidavit appears to have been used in many of the line items in the Twitter table dealing with the work performed by the associate: see n 8 above.
On one view, the obvious hopelessness of the applications for leave to appeal might tell in favour of conclusions that some of the time spent by the defendants’ lawyers was not reasonable. For example, in a taxation in the Nationwide proceeding, the plaintiffs might successfully contend that the 43.25 hours (more than four 10-hour days) spent by counsel is unreasonable and should not be allowed in full, notwithstanding that Nationwide’s costs might have been ordered to be taxed on the indemnity basis.
That said, an applicant for leave to appeal can hardly complain if those acting for the respondent do not immediately assume that the application for leave to appeal is manifestly hopeless, and that they (the respondent’s lawyers) therefore take the necessary amount of time to unpick all of that applicant’s arguments (even if many of those arguments ultimately ought properly to be considered to be peripheral, if not irrelevant).
Having examined in detail the material relied upon by Nationwide and Twitter in support of their applications for orders for gross sums instead of taxed costs, taking a broad brush approach,[29] I have concluded that a logical, fair and reasonable estimate of the costs of and incidental to the plaintiffs’ application for leave to appeal is $47,500 in the case of Nationwide, and $40,000 in the case of Twitter.
[29]Giurina [2021] VSCA 341, [16].
Conclusion
The plaintiffs will be ordered to pay Nationwide’s costs of and incidental to the application for leave to appeal in the Nationwide proceeding, fixed in the sum of $47,500.
The plaintiffs will be ordered to pay Twitter’s costs of and incidental to the application for leave to appeal in the Twitter proceeding, fixed in the sum of $40,000.
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