QE Family Pty Ltd v Peter Warren Automotive trading as Mercedes-Benz MacArthur (No 3)
[2024] FedCFamC2G 1204
•4 November 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
QE Family Pty Ltd v Peter Warren Automotive trading as Mercedes-Benz MacArthur (No 3) [2024] FedCFamC2G 1204
File number(s): CAG 39 of 2022 Judgment of: JUDGE CAMERON Date of judgment: 4 November 2024 Catchwords: PRACTICE AND PROCEDURE – Application to release monies paid into the Court for security – Late filing of a notice of objection to estimate of costs – Instanter application for an extension of time within which to file the notice of objection – Whether the Court had jurisdiction to hear the matter – Whether the registrar had power to order costs Legislation: Federal Court Rules 2011 (Cth), rr 40.20, 40.21, 40.32
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), rr 17.05, 22.02
Competition and Consumer Act 2010 (Cth), s 86
Federal Court of Australia Act 1976 (Cth), s 32AB
Federal Circuit and Family Court of Australia Act2021 (Cth), s 214
Cases cited: R v Kirby; Ex parte Boilermakers’ Society of Australia (1956) 94 CLR 254
Minister for Immigration and Multicultural and Indigenous Affairs, Re; Ex parte Palme (2003) 216 CLR 212
Division: General Number of paragraphs: 21 Date of hearing: 4 November 2024 Place: Sydney and Canberra Applicant: Dr M. Quach by leave Solicitor for the Respondent: Mr J. Bodon (Hunt & Hunt) ORDERS
CAG 39 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: QE FAMILY PTY LTD
Applicant
AND: PETER WARREN AUTOMOTIVE TRADING AS MERCEDES-BENZ MACARTHUR
Respondent
ORDER MADE BY:
JUDGE CAMERON
DATE OF ORDER:
4 NOVEMBER 2024
THE COURT ORDERS THAT:
1.The registry pay to the respondent, or at its direction, the $35,000 paid into Court by the applicant as security for costs.
2.The payment ordered in Order 1 be stayed for 14 days.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order 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 CAMERON
INTRODUCTION
This proceeding concerned an allegedly defective Mercedes Benz purchased by the applicant from the respondent in 2018 and an alleged breach of the Australian Consumer Law. The application was dismissed by Judge W J Neville on 28 February 2024 and, amongst other things, his Honour ordered that the applicant was to pay the respondent's costs as agreed or taxed. The respondent’s costs have been taxed at $54,515.28. The matter is before the Court today on the respondent's application for the release to it of $35,000 previously paid into Court as security for costs.
It is useful, at the outset, to lay out a short chronology of relevant facts and events:
(a)on 28 September 2023, the Court ordered the applicant to give security for costs in the amount of $35,000;
(b)on 18 October 2023, security was paid into Court in accordance with that order;
(c)on 28 February 2024, the proceeding was dismissed with costs to be agreed or taxed;
(d)on 29 April 2024, a bill of costs was filed;
(e)on 11 July 2024, an amended bill of costs was filed;
(f)on 9 August 2024, the registrar wrote to the parties advising her estimate of the likely taxed costs, a step taken pursuant to r.40.20(3) of the Federal Court Rules 2011 (Cth) (Federal Court Rules);
(g)on 30 August 2024, at some point after 4:30pm the applicant sought to lodge a notice of objection to the estimate of costs, and at the same time, sought details of how to deposit $2,000 into the Litigants’ Fund as required in the circumstances;
(h)on 6 September 2024, a certificate of taxation was issued in the amount of $54,515.28; and
(i)on 26 September 2024, the costs certificate was served late on the applicant.
LEGISLATION AND RULES
Rule 22.02 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (Rules) provides:
22.02 Order for costs
(1) An application for an order for costs may be made:
(a) at any stage in a proceeding; or
(b) within 28 days after a final decree or order is made; or
(c) within any further time allowed by the Court.
(2) In making an order for costs in a proceeding, the Court may:
…
(c) refer the costs for taxation under Part 40 of the Federal Court Rules; or
…
Part 40 of the Federal Court Rules relevantly provides:
40.20 Estimate of costs
(1) Before a bill is taxed, a taxing officer is to make an estimate of the approximate total for which, if the bill were taxed, the certificate of taxation would be likely to issue.
(2) The estimate in subrule (1) is to be made in the absence of the parties and without making any determination on the individual items in the bill.
(3) The taxing officer will give notice, in writing, to each party interested in the bill, of the estimate made under subrule (1) (the notice of estimate).
(4) Unless a party interested in the bill objects to the estimate in accordance with rule 40.21, the amount of the estimate is the amount for which the certificate of taxation will be issued.
40.21 Objection to estimate
(1) A party interested in the bill who wants to object to the estimate must, within 21 days after the issue of the notice of estimate:
(a) file a notice of objection, in accordance with Form 128; and
(b) pay into the Litigants’ Fund an amount of $2 000 as security for the costs of any taxation of the bill.
…
40.32 Certificate of taxation
(1) A taxing officer is to issue a sealed certificate of taxation, in accordance with Form 132, that must be served, within 14 days after the date it is issued, by the party who filed the bill, on the party responsible for payment of the costs.
(2) A certificate of taxation has the force and effect of an order of the Court.
…
Notwithstanding the contrary arguments raised by Dr Quach, who appeared for the applicant company, I am satisfied that it is appropriate to release the $35,000 which have been paid into Court.
CONSIDERATION
In reaching the conclusion that the sum deposited as security should be released to the respondent, I have had regard to the numerous arguments raised by Dr Quach but am persuaded by none of them. They were:
a) The Court had no jurisdiction to hear this matter
The proceeding was brought under the Competition and Consumer Act 2010 (Cth) (CC Act). It was commenced in the Federal Court of Australia but transferred to this Court on 6 December 2022. Dr Quach observed that the jurisdiction of this Court under s.86 of the CC Act is different from that of the Federal Court. The implication being that this Court had not had jurisdiction to hear his application.
Section 86(1) and (1A) of the CC Act provides:
86 Jurisdiction of courts
…
(1) Jurisdiction is conferred on the Federal Court in any matter arising under this Act, a gas market instrument or the consumer data rules in respect of which a civil proceeding has, whether before or after the commencement of this section, been instituted under this Part.
(1A) Jurisdiction is conferred on the Federal Circuit and Family Court of Australia (Division 2) in any matter arising under section 46, Part IVB or IVBB, section 55B, subsection 56BO(1) or 56BU(1), section 56BZA, 56BZB or 56BZC, subsection 56BZD(1), section 56BZJ, Part IVE, a civil penalty provision of a gas market instrument or a civil penalty provision of the consumer data rules in respect of which a civil proceeding is instituted by a person other than the Minister.
However, as recorded earlier, this proceeding was commenced in the Federal Court and later transferred to this Court. Section 32AB of the Federal Court of Australia Act 1976 (Cth) provides for transfers of proceedings from the Federal Court to this Court, relevantly as follows:
32ABDiscretionary transfer of civil proceedings to the Federal Circuit and Family Court of Australia
(1) If a proceeding is pending in the Court, the Court may, by order, transfer the proceeding from the Court to the Federal Circuit and Family Court of Australia.
…
(8B) The Federal Circuit and Family Court of Australia (Division 2) has jurisdiction in a matter that:
(a) is the subject of a proceeding transferred to the Federal Circuit and Family Court of Australia (Division 2) under this section; and
(b) is a matter in which the Federal Circuit and Family Court of Australia (Division 2) does not have jurisdiction apart from this subsection.
That provision makes it perfectly clear that when the Federal Court transfers a matter to this Court, that is to say the Federal Circuit and Family Court of Australia (Division 2), the Federal Court's jurisdiction over that matter is conferred on this Court for the purposes of that proceeding. There is no doubt in my mind that this Court had jurisdiction to hear the proceeding. In any event, I am advised today by Mr Bodon, who appears for the respondent, that the applicant has appealed Judge W J Neville's judgment, and the appeal has been dismissed summarily. The question of jurisdiction would therefore seem to have been settled on a final basis.
b) The Court had no power to order costs
Dr Quach further submitted that this Court had no power to order costs. That argument is misconceived as the Court has express power under the Federal Circuit and Family Court of Australia Act2021 (Cth) to award costs in proceedings. Section 214 of the Court’s statute relevantly provides:
214 Costs
…
(2) The Federal Circuit and Family Court of Australia (Division 2) or a Judge has jurisdiction to award costs in all proceedings before the Court (including proceedings dismissed for want of jurisdiction) other than proceedings in respect of which any other Act provides that costs must not be awarded.
The applicant did not identify any statutory provision which would have affected the Court's power to award costs in this proceeding.
c) Application for an extension of time
Dr Quach also made an instanter application to extend time for the filing of an objection to the registrar's costs estimate which had been advised to the parties in August. The Federal Court Rules provide that a certificate of taxation is to operate as an order of the Court. Further, it has been entered, being signed and sealed.
The only way that an application for an extension of time to make objection to the costs estimate can be made is if the certificate of taxation were to be set aside. Rule 17.05 of the Rules provides:
17.05 Setting aside or varying judgments or orders
…
(2) The Court or a Registrar may vary or set aside a judgment or order after it has been entered if:
(a) it was made in the absence of a party; or
(b) it was obtained by fraud; or
(c) it is interlocutory; or
(d) it is an injunction or for the appointment of a receiver; or
(e) it does not reflect the intention of the Court; or
(f) the party in whose favour it was made consents; or
(g) there is a clerical mistake in the judgment or order; or
(h) there is an error arising in the judgment or order from an accidental slip or omission.
None of the criteria for the setting aside of an entered order have been satisfied. Absent the setting aside of the costs order, the Court's role in relation to the determination of the quantification of costs in this matter is now over and the Court is functus officio in that regard. In those circumstances, it is not open to the applicant to file an application for an extension of time within which to make an objection to the registrar's costs estimate.
d) The registrar had no power to issue a certificate of taxation
Dr Quach also submitted that the applicant had not been out of time in filing its notice of objection, but the Rules make it quite clear that a document lodged electronically with the Court after 4:30pm on a working day will not be filed until the next working day. In this case, there seems no doubt that whatever documents the applicant sought to lodge with the Court on 30 August 2024 were lodged with the Court after 4:30pm and therefore would not be accepted for filing until the following working day. That is to say, the attempt to object to the registrar's estimate of costs was indeed filed out of time and the registrar did not err by proceeding thereafter to make a final assessment of the costs and to issue a certificate of taxation as she did.
e) The Court exercised an administrative function
Dr Quach noted that after the bill of costs in its original form had been filed, the Court wrote to the parties noting that there was a problem with the manner in which the costs claim had been presented to the Court. Dr Quach suggested that this amounted to the performance of an administrative function contrary to the separation of executive and judicial functions as explained by the High Court in R v Kirby; Ex parte Boilermakers’ Society of Australia (1956) 94 CLR 254 (Boilermakers’ Case).
This submission manifests a misunderstanding of the administrative functions which are unavoidably associated with the exercise of judicial power. One of these is to issue requisitions to parties who lodge documents with the Court to, amongst other things, ensure that they are in the proper form. That is what occurred on this occasion and, to the extent that there was an administrative function that was being exercised, it was one which was incidental to the Court's ultimate function of quelling the dispute between the parties through the exercise of the judicial power of the Commonwealth.
The applicant further submitted that the enforcement of a bill of costs was another administrative function that was beyond the power of the Court by reason of the decision of the High Court in the Boilermakers’ case. However, it is one of the functions of all courts, to enforce their orders by further orders or administrative steps. The release of funds paid into Court as security for costs is no different. It is simply an administrative step incidental to the judicial function. The authorisation of the release of the $35,000 held by the Court to the respondent or its solicitors as authorised does not offend the separation of powers prescribed by the Constitution.
d) The bill of costs was served out of time
The final point made by Dr Quach was that the certificate of taxation was unenforceable because it had been served outside the 14-day period prescribed by r.40.32 of the Federal Court Rules. The late service of the bill of costs does not affect the reality that the Court has ordered that an amount of money be paid. The enforceability or lawfulness of an order is not affected by a procedural step occurring after the making of the relevant order: cf. Minister for Immigration and Multicultural and Indigenous Affairs, Re; Ex parte Palme (2003) 216 CLR 212 at 225-226 [44]-[48]; 227-228 [55]-[56].
Further, it was not suggested that the late provision of the bill of costs to the applicant caused it any prejudice. In fact, it might be noted that the bill of costs was served because, in response to a request for the release of the $35,000 security, the Court advised the respondent that it would not authorise that step unless it was satisfied that the applicant had been made aware of the application for their release.
The applicant has been on notice of the certificate of taxation for over a month now and it has made an application in a proceeding in relation to the respondent's bill of costs. I see no prejudice to the applicant by the fact that the bill of costs was served in late September rather than somewhat earlier.
The certificate of taxation is enforceable and justifies the release of the funds sought by the respondent.
CONCLUSION
There will be an order for the release of the funds paid into Court.
I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Cameron. Associate:
Dated: 13 November 2024
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