Rana v Libraries Board of Australia and Ors (No.2)
[2008] FMCA 1037
•30 July 2008
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| RANA v LIBRARIES BOARD OF AUSTRALIA & ORS (No.2) | [2008] FMCA 1037 |
| TRADE PRACTICES – COSTS – Indemnity costs sought – factors to consider – indemnity costs order refused. |
| Federal Magistrates Act 1999 (Cth), s.17A |
| Australian Competition and Consumer Commission v Universal Music Australia Pty Ltd (formerly Polygram Pty Ltd) Australian Competition and Consumer Commission v Warner Music Australia Pty Ltd (No 2), unreported decisions of Hill J in the Federal Court of Australia of 6 March 2002 being Judgments numbered N925 of 1999 and N924 of 1999 Colgate Palmolive & Anor v Cussons Pty Ltd (1993) 46 FCR 225 Genovese v BGC Construction Pty Ltd (No 2) (2007) FMCA 601 Kembla Coal Terminal Limited v Braverus Maritime Inc (No 2) (2004) 212 ALR 281 McKerlie v State of New South Wales (No 2) [2000] NSWSC 1159 |
| Applicant: | RANJIT RANA |
| First Respondent: | STATE LIBRARIES BOARD OF AUSTRALIA |
| Second Respondent: | HOUSING TRUST OF SOUTH AUSTRALIA |
| Third Respondent: | INTERCONTINENTAL CATERERS PTY LTD |
| File Number: | ADG 86 of 2007 |
| Judgment of: | Simpson FM |
| Hearing date: | 11 July 2008 |
| Date of Last Submission: | 11 July 2008 |
| Delivered at: | Adelaide |
| Delivered on: | 30 July 2008 |
REPRESENTATION
| The Applicant: | Appears in person |
| Counsel for the First and Second Respondents: | Mr Wait |
| Solicitors for the First and Second Respondents: | Crown Solicitors Office |
| Counsel for the Third Respondent: | Mr N Minicozzi |
| Solicitors for the Third Respondent: | N Minicozzi |
ORDERS
The applicant pay the third respondent its costs to be agreed or taxed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADG 86 of 2007
| RANJIT RANA |
Applicant
And
| STATE LIBRARIES BOARD OF AUSTRALIA |
First Respondent
| HOUSING TRUST OF SOUTH AUSTRALIA |
Second Respondent
| INTERCONTINENTAL CATERERS PTY LTD |
Third Respondent
REASONS FOR JUDGMENT
This is an application by the third respondent for an order that the applicant pay its costs on an indemnity basis. The applicant in the proceedings is an unrepresented individual. The third respondent is a company with legal representation.
On 4 July 2008 I gave summary judgment for each of the respondents pursuant to s.17A of the Federal Magistrates Act 1999 (Cth). Counsel for the first and second respondents sought an order that the applicant pay the first and second respondents’ costs on a party/party basis. The order was not opposed by the applicant and the orders were made.
Counsel for the third respondent put that the third respondent was entitled to costs on an indemnity basis as on 29 August 2007 a letter had been sent to the applicant by solicitors for the third respondent which contained an offer and the offer was not accepted by the applicant. With the consent of the applicant I received a copy of the letter concerned. It stated as follows:
Dear Sir
Re: Federal Magistrates Court Action Number ADG86 of 2007 – Intercontinental Caterers Pty Ltd
As you know this matter is listed for hearing in the Federal Magistrates Court on 13 September 2007.
The application that my client has made returnable for that date is that the proceedings instituted by you against Intercontinental Caterers Pty Ltd be struck out as those proceedings do not disclose a cause of action as against Intercontinental Caterers Pty Ltd.
I am now instructed to advise that if you file a Notice of Discontinuance as against my client on or before the 6th of September 2007 my client will not seek costs against you if it is successful in these proceedings.
In the event that you fail to accept this offer and the matter proceeds and my client is successful in its defence against your claim, then this letter will be tendered in evidence in an application for indemnity costs against you.
Yours faithfully
N Minicozzi.
Other than the submission that the applicant did not take advantage of the opportunity to discontinue as suggested in the solicitor’s letter and that this justified an order for indemnity costs no other basis was advanced for such an order. Further, no authority was provided in support of the application for indemnity costs.
The applicant did not oppose an order for costs against him in favour of the third respondent but opposed it being on an indemnity basis.
The burden is on the third respondent to show that a special costs order is justified. (See Port Kembla Coal Terminal Limited v Braverus Maritime Inc (No 2) (2004) 212 ALR 281. The usual practice, not to be lightly departed from, is that costs be on a party/party basis (see Colgate Palmolive & Anor v Cussons Pty Ltd (1993) 46 FCR 225 at p.233). The relevant authorities as to the circumstances in which a Court will depart from the usual practice are contained in a helpful summary by Lucev FM in Genovese v BGC Construction Pty Ltd (No 2) (2007) FMCA 601 at paras. 47-48 which he concludes with the following:
“The discretion is not so circumscribed that an indemnity costs order “may only be made against an ethically and morally delinquent party”. The discretionary categories are not closed, and “other elements of litigious misconduct may be relevant”.” (Quoting from Rouse v Shepherd [No 2] (1994) 35 NSWLR 277 at 279 and 281 per Badgery-Parker J).
In McKerlie v State of New South Wales (No 2) [2000] NSWSC 1159 the Court expressly stated that the offer to settle a case by having the action dismissed with no order as to costs did not carry with it the consequences of a Calderbank letter (namely, that there be an award for indemnity costs). This case has been followed in Australian Competition and Consumer Commission v Universal Music Australia Pty Ltd (formerly Polygram Pty Ltd); and Australian Competition and Consumer Commission v Warner Music Australia Pty Ltd (No 2), unreported decisions of Hill J in the Federal Court of Australia of 6 March 2002 being Judgments numbered N925 of 1999 and N924 of 1999.
The letter does not give any explanation as to why the proceedings should be continued as McKerlie’s case suggested should be included. Further, the letter is somewhat ambiguous as it includes the words “if it is successful in these proceedings” at the end of the sentence giving the applicant the opportunity of discontinuing with no order as to costs.
In my opinion, on the basis of the above authorities and for the reasons stated, the appropriate course is to make an order for party/party costs only. I therefore make the orders to be found at the beginning of these reasons.
I certify that the preceding nine (9) paragraphs are a true copy of the reasons for judgment of Simpson FM
Associate: Julie Davey
Date: 30 July 2008
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