Oil Basins Limited v Watson

Case [2017] FCAFC 103

FEDERAL COURT OF AUSTRALIA

Oil Basins Limited v Watson [2017] FCAFC 103

Appeal from: Watson on behalf of the Nyikina Mangala People v State of Western Australia (No 7) [2015] FCA 1404
File number(s): WAD 27 of 2016
Judge(s): NORTH ACJ, DOWSETT AND RARES JJ
Date of judgment: 6 July 2017
Catchwords: NATIVE TITLE – costs – whether respondents able to obtain indemnity for legal costs from appellant – whether respondents liable for any legal costs where represented by native title representative body – whether respondents’ solicitor made concession that respondents had no liability to pay legal costs – no such concession made – appeal dismissed. 
Legislation:

Federal Court of Australia Act1976 ss 4, 43

Judiciary Act 1903 (Cth) ss 55A, 55B, 55C

Native Title Act 1993 (Cth) ss 85, 85A, 201B, 203AD, 203B, 203BA, 203BB, 203BC, 203BK, 253

Federal Court Rules 2011 r 4.01
Cases cited:

APLA Ltd v Legal Services Commissioner of New South Wales (2005) 224 CLR 322

Australian Workers Union v Bowen (1946) 72 CLR 575

Banco de Bilbao v Sancha [1938] 2 KB 176

Blackall v Trotter (No 1) [1969] VR 939

Brownsea Haven Properties Ltd v Poole Corporation [1958] 1 Ch 574

Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95

Far West Coast Native Title Claim v State of South Australia (No 8) [2014] FCA 635

Guss v Veenhuizen (No 2) (1976) 136 CLR 47

Halliday v Sacs Group Pty Ltd (HCA unreported 23 December 1992)

Halliday v High Performance Personnel Pty Ltd (In Liq) (formerly Sacs Group Pty Ltd) (1993) 113 ALR 637

Hawker v Weston (No 2) [2015] FCA 521

Hockey v Fairfax Media Publications Pty Ltd (No 2) [2015] FCA 750

Hudgson v Endrust (Australia) Pty Ltd (1986) 11 FCR 152

Inglis v Moore (No 2) (1979) 46 FLR 470

Lawrie v Lawler (2016) 168 NTR 1

Lenthall v Hillson [1933] SASR 31

Marsh v Baxter (No 2) [2016] WASCA 51

New Pinnacle Group Silver Mining Co v Luhrig Coal and Ore Dressing Appliances Co (1902) 2 SR (NSW) 50

R v The Archbishop of Canterbury ex parte Cobham [1903] 1 KB 289

University of Western Australia v Gray (No 25) (2009) 180 FCR 483  
Date of hearing: 5, 8 August 2016
Registry: Western Australia
Division: General Division
National Practice Area: Native Title
Category: Catchwords
Number of paragraphs: 138
Counsel for the Appellant: Mr G Cobby
Solicitor for the Appellant: Hunt & Humphry
Counsel for the Respondents: Mr V Hughston and Mr J Edwards
Solicitor for the Respondents: Kimberley Land Council

ORDERS

WAD 27 of 2016
BETWEEN:

OIL BASINS LIMITED

Appellant
AND:

JOHN WATSON

First Respondent

ANTHONY WATSON

Second Respondent

ROBERT WATSON (and others named in the Schedule)

Third Respondent

JUDGES:

NORTH ACJ, DOWSETT AND RARES JJ

DATE OF ORDER:

6 JULY 2017

THE COURT ORDERS THAT:

1.The appeal is dismissed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

NORTH ACJ AND RARES J:

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Oil Basins Limited v Watson [2017] FCAFC 103
Case
[2017] FCAFC 103
Decision Date

CaseChat Overview and Summary

Oil Basins Limited, the appellant, filed an application for review of taxation of legal costs under r 40.34(2) of the Federal Court Rules 2011, seeking to challenge the decision of the registrar to allow certain legal costs incurred by the respondents in native title proceedings. The respondents, represented by the Kimberley Land Council (KLC) and its principal legal officer Ms Jacki Cole, were contesting the claim that they should not be required to indemnify the appellant for the costs. The primary judge dismissed the appeal, and Oil Basins Limited appealed to the court, arguing that the respondents had no liability to pay legal costs and therefore, there was nothing to indemnify.

The court had to determine whether the respondents were liable to indemnify the appellant for the legal costs incurred in the proceedings. The central issue was whether the respondents had any liability to pay the costs to their solicitor, Ms Cole, and if not, whether the Court could still require the respondents to indemnify the appellant for those costs. The court also had to consider whether there was a concession by the respondents' solicitor, Mr Kevin Murphy, that the respondents had no liability to pay any costs to Ms Cole.

The court held that the primary judge did not make the finding that Mr Murphy conceded that the respondents had no liability to pay legal costs. The court further held that the KLC, as a Native Title Representative Body (NTRB), received funding from the Commonwealth to assist persons in native title proceedings, and it was appropriate for the KLC to engage a solicitor or lawyer to represent the respondents. The court found that the KLC incurred costs through Ms Cole's actions and that the respondents were liable to indemnify the appellant for those costs. The court also found that the respondents had a potential liability to pay the costs to Ms Cole if the Commonwealth did not continue to provide funding.

The appeal was dismissed, and the decision of the primary judge was affirmed. The court held that the respondents were liable to indemnify the appellant for the legal costs incurred in the proceedings.

Orders

Orders of the court

1. The appeal is dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

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

NORTH ACJ
On 17 June 2015, Oil Basins filed the application for review of the taxation under r 40.34(2) of the Federal Court Rules 2011. On 2 October 2015, Oil Basins filed an amended application for review of the taxation.THE JUDGMENT OF THE PRIMARY JUDGE The primary judge said at [10]:The primary argument made by Oil Basins is that, because the claimants had no liability to pay their lawyer for costs incurred in the conduct of the proceeding, and in fact paid no costs at all, there was nothing to indemnify and all the items in the bill of costs should have been disallowed by the registrar. His Honour found at [15] that Ms Jacki Cole, the then principal legal officer of the Kimberley Land Council (KLC), was properly named as the respondents’ solicitor on the record. The KLC was the representative body acting on behalf of the respondents, but was not the solicitor on the record. His Honour then referred to the argument advanced by Oil Basins as follows:17Turning more precisely to the issue at hand, Oil Basins notes that at the taxation before the registrar on 7 April 2015 the current solicitor on the record for the claimants, Mr Kevin Murphy, the principal legal officer of the KLC, conceded that the claimants had no legal liability to pay any costs to Ms Cole.18Oil Basins contends that, there being no liability in the claimants to pay Ms Cole, and in circumstances where no costs were in fact paid, there is nothing to indemnify and accordingly all the items in the bill of costs should be disallowed. His Honour continued:20Oil Basins further submits that, in any event, whether or not the KLC was able to charge for legal services was not the relevant issue before the registrar at the taxation. It says there was no evidence before the registrar that the KLC or Ms Cole were engaged by the claimants or the terms of any engagement. Rather the evidence was that there was no costs agreement between the KLC and the claimants.21Oil Basins says that at the taxation on 7 April 2015, the solicitor now on the record, Mr Murphy, conceded that the claimants had no legal liability to pay any costs to Ms Cole. Oil Basins submits, that being the evidence, the only finding that could be made is that under no circumstances did the claimants have any legal liability to pay costs to Ms Cole. His Honour referred to several arguments put by Oil Basins that the KLC and/or Ms Cole were not entitled to charge legal fees. For instance, it was argued that, contrary to the view adopted by the Registrar, the KLC was not a community legal centre and hence not entitled to charge the respondents legal fees by virtue of that status. These arguments need not be referred to further because they did not figure in the appeal. The primary judge then referred to the relevant argument advanced by the respondents as follows:27The claimants do not dispute the key facts, to the effect that they have no liability to pay the costs of Ms Cole, the then solicitor on the record, and have not paid any costs.28The claimants say, however, three facts in addition to those set out in Oil Basins’ submissions are relevant:(1)the KLC is recognised as a Native Title Representative Body (NTRB) under the NTA;(2)the KLC receives funding from the Commonwealth for the services that it conducts to fulfil its functions under the NTA; and(3)the KLC is a community legal centre for the purposes of the Legal Profession Act.…30In that regard, the claimants say there is only one issue between the parties and that is whether the Court can apply Mansfield J’s decision in Far West Coast Native Title Claim so as to dismiss the review application.31So far as the application of the Far West Coast Native Title Claim decision in the present circumstances is concerned, the claimants concede:Ÿthere was no costs agreement between the KLC and the claimants; andŸthe claimants have no liability to pay the KLC’s costs.32However, the claimants contest the proposition put by Oil Basins that there was no retainer between the KLC or Ms Cole and the claimants, saying that plainly there was. It contends this can be inferred from the fact that Ms Cole was the solicitor on the record and from the many published decisions of the Court recording the fact that the KLC and Ms Cole acted for the claimants. Thus the claimants contend that it follows that while the claimants may not have expected to be liable to pay costs, underlying the relationship was an understanding that such a liability may exist; citing Far West Coast Native Title Claim at [22] to this end.

Ratio Decidendi

Legal Principle Established

Established by: NORTH ACJ

In support of this argument, Mr Cobby referred to [27] and [31] in the primary judgment, extracted above at [10], in which the alleged concessions were recorded. The first was made before the Registrar, and the second was made in the course of the review. CONSIDERATION A representative body, such as the KLC, has the statutory facilitation and assistance functions, under s 203BB(1)(b) of the Act, of assisting persons who may hold native title “including by representing them or facilitating their representation … in … proceedings relating to … (i) native title applications”. However, s 203BB(2) requires a representative body not to perform those functions “unless it is requested to do so”. In performing those functions in relation to an application under s 61 of the Act, such as one for a determination of native title, a representative body has to “act in a way that promotes an orderly, efficient and cost-effective process for making such applications”, pursuant to s 203BC(3). The Secretary of the Department administering the Act, on behalf of the Commonwealth, can provide funds to a representative body (s 203C(2)) and the body has to do all things necessary to ensure that payments out of the money were correctly made (s 203DB). Thus, the Act contemplates that a representative body, such as the KLC, would receive funds from the Commonwealth enabling the body to assist an applicant for a determination of native title under s 61 to be legally represented in those proceedings by a solicitor or lawyer on the record, such as Ms Cole or Mr Murphy and by counsel briefed by such a solicitor or lawyer. That is, the Act contemplates that, in the ordinary course, a representative body, in the KLC’s position, would receive a grant of funds from the Commonwealth to enable it to engage a solicitor or lawyer to act, on the Court record, for an applicant and to retain counsel. It followed that there was a chance that the solicitor or lawyer so acting would make a direct claim against the representative body or applicant for which the s 61 application was made, if the Commonwealth did not continue to provide funding, but in the ordinary course no-one needed to be concerned with such a scenario. Moreover, that situation is closely analogous to that when a Minister is represented in his or her official capacity by a solicitor or lawyer acting for the Crown (including when that person retains counsel to appear) in legal proceedings. The practical reality is that Ms Cole was the solicitor on the record, even if employed or retained by the KLC, and the KLC incurred costs (that it paid from money granted to it), through her acting and retaining counsel in the proceedings in which Oil Basins was ordered to pay costs. Oil Basins’ argument on this appeal relied on the alleged finding by the primary judge that Mr Murphy conceded that the respondents had no liability to pay legal costs. However, in addition to [27] and [31] relied upon by Mr Cobby, the primary judge also recorded at [32], extracted above at [10], that the respondents contested the suggestion that Mr Murphy had made an unqualified concession.