Otter Products v Haydon

[2021] FedCFamC2G 13

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Otter Products v Haydon [2021] FedCFamC2G 13

File number(s):

MLG 1326 of 2021

Judgment of:

JUDGE BAIRD

Date of judgment:

15 September 2021

Catchwords:

PRACTICE AND PROCEDURE – COSTS – Assessment of costs ordered under Schedule 1, Part 1 of Federal Circuit Court Rules 2001 (Cth)

Legislation:

Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)

Federal Circuit and Family Court of Australia Act 2021 (Cth) s 217

Federal Circuit Court of Australia Act 1999 (Cth) s 17A

Federal Circuit Court Rules 2001(Cth) rr 13.03C, 13.07, Schedule 1 of Part 1

Division:

Division 2 General Federal Law

Number of paragraphs:

25

Date of last submission/s:

24 August 2021

Date of hearing:

Determined on the papers

Place:

Sydney

Solicitor for the Applicant:

Stephen Marcus Stern, Corrs Chambers Westgarth

Respondent:

Peter Haydon

ORDERS

MLG 1326 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

OTTER PRODUCTS, LLC

Applicant

AND:

PETER HAYDON

Respondent

ORDER MADE BY:	JUDGE BAIRD
DATE OF ORDER:	15 SEPTEMBER 2021

THE COURT ORDERS THAT:

1.The applicant’s costs ordered by paragraph 8 of Orders of the Court made 17 August 2021 be fixed in the sum of $13,144.41.

Note: The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT

Judge Baird

Introduction

1. On 17 August 2021 I heard and determined the applicant’s, Otter Products, LLC’s, claim for summary judgment in this proceeding against the respondent, Mr Peter Haydon. Pursuant to s 17A of the Federal Circuit Court of Australia Act 1999 (Cth) and rule 13.07 of the Federal Circuit Court Rules 2001(Cth) I gave judgment ex tempore in favour of Otter Products: see Otter Products, LLC v Peter Haydon [2021] FCCA 2012.

2. I made the following order in relation to costs:

   8.ORDERS the Respondent pay to Otter Products its costs of this proceeding up to and including the hearing on 17 August 2021, in accordance with the scale amount in Part 1 Schedule of the Federal Circuit Court Rules 2001 (Cth), and:

   (a)DIRECT Otter Products provide to the Chambers of Judge Baird and serve on the Respondent a schedule of its calculations of its costs by 5pm 24 August 2021;

   (b)DIRECT the respondent provide to the Chambers of Judge Baird and serve on the respondent any submissions on the calculation of costs by 31 August 2021; and

   NOTES, by consent, the Court will determine the amount of such costs on the papers pursuant to r 15.03 of the Rules. 

   (Costs Order).

3. “Part 1 Schedule 1” identified in the Cost Order should be “Schedule 1, Part 1”. Nothing turns on this transpositional error. For convenience, generally in these reasons I refer to Schedule 1, Part 1 of the Rules as the Schedule. 

4. At the hearing on 17 August 2021 Otter Products did not particularise the costs that it sought pursuant to the Schedule, or otherwise.  The Costs Order provided an opportunity for Otter Products to remedy its omission.

   The parties’ submissions on costs

5. On 24 August 2021, Otter Products’ solicitors provided a schedule of its calculation of its costs in the proceeding (Otter Products schedule) to my Chambers, and evidence of its service by email on Mr Haydon.  By cover email to Chambers dated 24 August 2021 Otter Products’ solicitors explained their calculation in the Otter Products schedule as follows:

   In accordance with Order 8(a) of her Honour’s Orders made on 17 August 2021, we attach a schedule of the Applicant’s calculation of its costs in this proceeding.

   The costs set out in this schedule include for:

   1.preparation of the Statement of Claim, Originating Application and Applicant’s Genuine Steps Statement;

   2.        court’s fees for filing of the Court documents listed above;

   3.three interim hearings (two of which included the preparation of affidavit evidence) and associated hearing fees;

   4.preparation for final hearing, including the preparation, filing and service of eight affidavits;

   5.        fees for a half-day hearing and cost for attendance of solicitor to take judgment;

   6.        the fees of the Applicant’s agent for:

   a.their attendance at the various Technology Traders stores to review the products and purchase counterfeit OtterBox products;

   b.        service of a letter of demand at the Respondent’s store;

   c.        inspection of these counterfeit OtterBox products;

   d.        investigations into the supplier of the counterfeit OtterBox products;

   e.repeated attempts at service of court documents on Respondent at his residence; and

   f.the agent’s disbursements including the cost of these counterfeit OtterBox products; photocopying and printing costs and various title, ASIC and online searches.

6. Mr Haydon has not provided any submissions to my Chambers.  He was not obliged to.  As required by the Costs Order, these reasons comprise my assessment of the quantum of the costs ordered. 

   Present Act and applicable Rules

7. On 1 September 2021, this Court was renamed the ‘Federal Circuit and Family Court of Australia (Division 2)’ further to the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FC&FCoA), which then came into effect. The FC&FCoA in large part has imported the provisions of the Act. Pursuant to s 217 of the FC&FCoA, the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (GFL Rules) have been made and now operate as the rules of this Court on and from 1 September 2021.

8. As the Costs Order was made on 17 August 2021 however, and as stated in the Costs Order, Schedule 1, Part 1 of the Rules, applies. Thus the consequence of the Costs Order is that Otter Products’ costs have been awarded in accordance with the Schedule (that is, Schedule 1, Part 1 of the Rules). It follows that the amount awarded is to be assessed by me in accordance with the events-based scale set out in that Schedule, in the amounts specified for the relevant item, being those specified in the Schedule in force as and from 4 August 2018 to 31 August 2021.

   The proceeding and costs events

9. As a proceeding concerning Otter Products’ claim for relief for infringement of its registered trade mark rights, the proceeding was docketed to me for case management as the judge of the Court conducting the Court’s National Intellectual Property List (IP List).  The originating application was listed before me for a first court date (also referred to in the conduct of the IP List as the first case management hearing) on 14 July 2021.  The originating application sought final orders.  It did not seek interim orders.  Prior to the first court date, however, at the request of Otter Products upon evidence and submissions, on 6 July 2021 in Chambers I made orders for substituted and deemed service.

10. In total there were three hearings conducted by the Court in relation to this proceeding: 14 July 2021, 5 August 2021, and 17 August 2021.  On the first court date on 14 July 2021 both parties appeared.  I made procedural orders comprising a timetable for filing and service of a defence and an affidavit by Mr Haydon, referral of the matter to mediation and consequential orders for the conduct of the mediation, a relisting date, and granted liberty to apply.  On 5 August 2021 I conducted a case management hearing further to Otter Products’ exercise of liberty to apply upon Mr Haydon’s default in the timetable.  Otter Products alone appeared.  I made orders including orders extending time for Mr Haydon’s compliance, and by paragraph 2 of the orders, in the event of Mr Haydon’s further default, listing the proceeding on 17 August 2021 for the hearing of any application for orders pursuant to rule 13.03C of the Rules. 

11. As I have said above, on 17 August 2021, I heard and determined Otter Products’ interlocutory application for summary judgment.  I did so, without requiring Otter Products’ to file and serve an application in a case but requiring service and provision to Chambers of draft orders.  The hearing for summary judgment was conducted by video-conference.  Otter Products’ solicitor appeared on the hearing of that application, assisted off‑screen by another solicitor.  Mr Haydon appeared self‑represented.  He did not rely on any affidavit or other evidence.

    The Schedule

12. As I have said, the Schedule is an events-based scale.  Events are identified by item number and description.  The Otter Products schedule claims amounts by reference to items 1, 3, 6, 9, 12, 13, and 14.  These items of the Schedule state as follows (omitting column 3, which relates only to family law events):

Item	Description	Amount for a general federal law proceeding (including GST)
1	Initiating or opposing an application up to the completion of the first court date	Both: (a)    $2,992; and (b)   The daily hearing fee mentioned in item 13 that applies to the hearing
3	Interim or summary hearing – as a discrete event Note: this stage applies to an interim application or a summary proceeding of a type not otherwise addressed in this fee structure.  It does not include the item 1 or 2 component.	Both: (a)    $1,867; and (b)   The daily hearing fee mentioned in item 13 that applies to the hearing
6	Preparation for final hearing – one day matter	$6,728.
9	Final hearing costs for attendance of solicitor at hearing to take judgment and explain orders	Both: (a)    $1,867; and (b)   The daily hearing fee mentioned in item 13 that applies to the hearing
12	Advocacy loading	50% of the daily hearing fee mentioned in item 13 that applies to the hearing
13	Daily hearing fee	Either: (a)    For a short mention - $305; or (b)   For a half day hearing - $1,120; …
14	Disbursements – Court fees and other fees and payments to the extent that they have been reasonably incurred	The amount of the fees and payments

Consideration of Schedule events

1. The description for item 1 is “Initiating … an application up to the completion of the first court date” (emphasis added).  This item encompasses the act of initiating the proceeding and all that entails, and whatever occurs up to completion of the first court date.  Thus, it expressly includes the first court date.  It is clear on the face of item 1 that the daily hearing fee (item 1(b)) is dependent on the length of the appearance before the Court at the first court date (in the absence of the Court ordering otherwise: see r 21.10), and that it does not permit of yet a further amount being awarded for attending the first court date, or for obtaining orders without an oral hearing, or an application in a case. 

2. Item 2, not set out above, provides for the event “Initiating or opposing an application which includes interim orders (other than procedural orders) up to the completion of the first court date”.  Properly, given that the application in this proceeding did not seek interim orders, Otter Products did not seek to claim an item 2 amount.

3. Item 3 is clear.  The event is an “Interim or summary hearing - as a discrete event”.  The Note takes the matter beyond doubt.  In the ordinary course in this Court such a hearing is listed further to an application in a case being filed. 

4. As the Note makes plain, item 3 does not apply to the first court date, nor to subsequent case management hearings or directions in the course of the interlocutory steps in a proceeding.  Case management hearings in the IP List are directions hearings and are not interim or summary hearings.  After the first court date, any subsequent case management or directions hearings in the course of the interlocutory steps in a proceeding are addressed in item 13 of the Schedule.  

5. Self‑evidently, item 3 does not apply to a final hearing.  An application for summary judgment, as is an application for default judgment, is a summary procedure.  It follows the hearing of such an application is an item 3 event.

   Consideration

6. I have reviewed Otter Products schedule and had regard to Otter Products’ solicitors covering submission.  For the reasons I have set out above, they are misconceived.

7. As I have explained above, it is incorrect to characterise the preparation of originating process (originating application, statement of claim and genuine steps statement) as an event separate from the first court date, to characterise the first court date as an interim or summary hearing under item 3, to characterise the 5 August 2021 case management/directions hearing as an interim or summary hearing rather than the short mention it was, or to characterise the summary hearing on 17 August 2021, as a final hearing.

8. Further, and contrary to Otter Products schedule, and the submissions set out at [5] above the following do not come within the Costs Order:

   (i)an interim hearing on 6 July 2021.  There was no such hearing nor interim application filed.  Item 1 encompasses events up to completion of the first court date (in the present case, 14 July 2021);

   (ii)item 6 preparation for final hearing; and

   (iii)item 9 final hearing costs for attendance of solicitor at hearing to take judgment, and explain orders.

9. For the above reasons, and in the circumstances I have set out at [9]-[11] above, the events assessable under the Costs Order are those corresponding to items 1, 3, 13, and disbursements as I allow under item 14. In addition, it is a matter for my assessment whether an advocacy loading pursuant to item 12 should be allowed in respect of each hearing.

   Advocacy loading (item 12)

10. This proceeding was a straightforward claim for infringement of registered trade marks by dealing in the course of trade with what I found to be counterfeit goods, specifically mobile phone cases to which were applied various Otter Products’ Australian registered trade marks without its licence or authority.  Notwithstanding this, in part because of Mr Haydon’s intermittent participation at directions/case management hearings, and in part because of the matters required to be established in this proceeding in order to satisfy me it was proper to give summary judgment, I consider it reasonable to allow an advocacy loading to each of the three hearings conducted in the proceeding.

    Disbursements (item 14)

11. The Otter Products schedule sets out a number of item 14 disbursements comprising Court fee, and Agent’s fees including for attendances at Mr Haydon’s stores, product investigations, trap purchases, receipt and inspection of products delivered up, attempted service, and service, and similar (see also the submissions at [5], item 6).  These disbursements claimed are evidenced by accompanying detailed invoices.  I have reviewed the invoices, and am satisfied that the amounts have been reasonably incurred.

    Assessment of costs under the Costs Order

12. Applying the above items I have specified at [21]-[23] to the Court events conducted set out at  [9]‑[11], and disbursements incurred in this proceeding, I find the quantum of Otter Products costs is as follows:

    (1)for the first court date on 14 July 2021, pursuant to item 1:

    (a) $2,992, and (b) $305, and $152.50, being the sum of $3,449.50

    (comprising item 1(a) and (b) (item 13 (a) as a short mention, and item 12 advocacy loading)); and

    (2)for the second case management/directions hearing on 5 August 2021, pursuant to item 13:

    (a) $305, and $152.50, being the sum of $457.50

    (comprising item 13(a) short mention and item 12 advocacy loading))

    (3)for the summary hearing on 17 August 2021, as a discrete event, pursuant to item 3:

    (a) $1,867; and (b) $1,120, and $560, being the sum of $3,547.00

    (comprising item 3(a) and (b) (item 13(b) a half day hearing and item 12 advocacy loading))

    (4)disbursements pursuant to item 14: $5,690.41 (Court fee of $1,660.00 and Agent’s fees of $4,030.41)

    Being total costs in the sum of $13,144.41.

13. I so order.

26          I certify that the preceding twenty‑five (25) numbered paragraphs are a true copy of the reasons for judgment of Judge Baird.

Deputy Associate:

Dated:       15 September 2021