Ruzehaji v Commissioner of the Australian Federal Police (No 2) - [2016] SASCFC 24

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
RUZEHAJI v COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE (No 2)
[2016] SASCFC 24
Judgment of The Full Court
(The Honourable Justice Gray, The Honourable Justice Peek and The Honourable Justice Nicholson)
15 March 2016
PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT
Application for costs. In November 2012, following the making of an ex parte application in the District Court, the respondent obtained orders against the appellants pursuant to the Proceeds of Crime Act 2002 (Cth), including an examination order and restraining orders. The first appellant was subsequently charged with a number of criminal offences. In the months that followed, the parties cooperated and varied a number of the orders by consent. In September 2013, cooperation between the parties ceased. The appellants filed an interlocutory application in the District Court seeking to discharge the orders and stay the Proceeds of Crime Act proceedings pending the determination of the criminal proceedings. The application was dismissed. The appellants’ appeals and application for judicial review to this Court were dismissed. On the appeal, the respondent gave an undertaking that the examination of the first appellant pursuant to the District Court order would not touch upon any matters relevant to the criminal proceedings. The wording of the undertaking was different to the wording of an undertaking which had previously been proffered by the respondent before the District Court.
Whether costs should follow the event.
Held per Gray J (Peek and Nicholson JJ agreeing) (granting the respondent’s application for costs on a party and party basis):
1.      Aside from being unsuccessful as to the result, a number of the appellants’ contentions on appeal were unsuccessful.
2.      The wording of the respondent’s undertaking offered before this Court on appeal was slightly different to that proffered in the District Court. However, the substantive effect was unchanged. The first appellant’s position was not improved by the bringing of the appeals or application for judicial review.
3.      Though the proceeding raised issues of public importance, this did not warrant a departure from the usual order as to costs.
Proceeds of Crime Act 2002 (Cth), referred to.
Schuller v S J Webb Nominees Pty Ltd (No 2) [2015] SASCFC 190; Ruzehaji v Commissioner of the Australian Federal Police [2015] SASCFC 182, considered.

RUZEHAJI v COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE (No 2)
[2016] SASCFC 24
Full Court: Gray, Peek and Nicholson JJ
GRAY J.

This is an application for costs.
Background
In November 2012, following the making of an ex parte application in the District Court, the respondent, the Commissioner of the Australian Federal Police, obtained orders pursuant to the Proceeds of Crime Act 2002 (Cth) including: an order that the Official Trustee in Bankruptcy take possession of a motor vehicle, an examination order, and restraining orders, in respect of the appellants, Amir Sabit Ruzehaji and Ruzehaji Enterprises Pty Ltd. The first appellant, Mr Ruzehaji, was subsequently charged with a number of criminal offences, including drug trafficking offences. In the months that followed, the parties cooperated and varied a number of the orders by consent.
In September 2013, cooperation between the parties ceased. The appellants filed an interlocutory application in the District Court seeking to set aside the examination order or stay the Proceeds of Crime Act proceedings pending the determination of the criminal proceedings with which the first appellant had been charged. The application was dismissed.
The appellants lodged two appeals, which were subsequently consolidated, and an application for judicial review in this Court. On 10 December 2015, this Court dismissed the appeals and the application for judicial review.[1]
[1] Ruzehaji v Commissioner of the Australian Federal Police [2015] SASCFC 182.
Aside from being unsuccessful as to the result, a number of the appellants’ contentions on appeal were unsuccessful. These included a constitutional challenge to the Proceeds of Crime Act and various complaints about the Judge’s ex parte orders, which were founded on the submission, rejected by this Court, that the orders were of a final rather than interlocutory nature.
An issue on the appeal was whether the first appellant would suffer prejudice if examination proceedings were to proceed while criminal proceedings were on foot. An important consideration in deciding this issue was an undertaking offered by the respondent that the examination would not address the subject matter of the criminal charges laid against the first appellant. The respondent’s outline of argument submitted to the District Court on 20 September 2013 in response to the appellants’ application for a stay set out the respondent’s undertaking in the following terms:
a.   The evidence given by the first [appellant] in the March examination has not been disseminated to anyone involved in the criminal investigation or prosecution of the first [appellant]. The evidence given has been controlled by the [respondent] to avoid that possibility.
b.   The [respondent] is willing to, and hereby undertakes to the first [appellant], that he will not disseminate evidence of any examination of the first [appellant] to a person involved in the criminal investigation or prosecution of the first [appellant], without giving the first [appellant] 7 days’ notice of his intention to do so.
c.   At the October hearings the [respondent] intends to examine the first [appellant] about:
i.    his financial affairs, and
ii.   matters that do not pertain to his guilt or otherwise on the criminal charges that he currently faces.
d.   The purpose of the proposed October examination of the first [appellant] was communicated to his solicitor on 19 August 2013 in the following terms: “If I do seek to examine [the first appellant] further, it will not be in relation to the matters with which he had been charged”. ...
e.   The [respondent] further undertakes to the first [appellant] not to examine him, in any future examination, about matters that pertain to his guilt or otherwise on the criminal charges that he currently faces without giving 7 days’ notice of his intention to do so.
[Emphasis in original.]
In his outline of argument dated 21 May 2015, the respondent expressly referred to and relied on this undertaking. The outline of argument also contained the following sentence:
Moreover, in the present proceeding there is an undertaking that the examination will not deal with the subject matter of the criminal charges.
At the hearing of the appeal, the following exchange took place with counsel for the respondent:
GRAY ACJ: Can I just make sure I fully understand paragraph 4.3 of your written submission where you deal with the undertaking?
MR MOSES:       This is the most recent supplementary submissions?
GRAY ACJ: 21 May I am looking at, paragraph 4.3, it’s the last sentence of that paragraph:
‘Moreover in the present proceeding ... subject matter of the criminal charges.’
The wording of that undertaking that is expressed there differs a little from the earlier version. I want to be quite clear the undertaking is in the terms expressed in paragraph 4.3.
MR MOSES:       Yes.
GRAY ACJ:And that reasonable notice will be given before that undertaking is withdrawn.
MR MOSES:       Yes.
GRAY ACJ:       Sufficient time that if the examinee wanted to -
MR MOSES:       Traverse those matters -
GRAY ACJ:               - make a challenge, there would be ample opportunity to do so.
MR MOSES:Yes, those are the undertakings that I am instructed to give on behalf of the commissioner and they are undertakings to the court.
NICHOLSON J: So, those are undertakings given today.
MR MOSES:       Yes.
NICHOLSON J: So, any previous undertakings in the forms we can ignore now, we accept what is on the transcript today.
MR MOSES:       That is correct.
GRAY ACJ: As I understand it, you say this is the substantive effect of the earlier undertaking.
MR MOSES:       They are the substantive effect.
GRAY ACJ:       Yes, thank you.
MR MOSES: But I am instructed to provide that undertaking. It has been provided previously but insofar as being clarified through my exchange with the Acting Chief Justice, that is it, and the court can rely upon that.
This Court held that the first appellant had not established that he would suffer real prejudice if the examination proceedings were allowed to proceed:[2]
It is against this background that I come to consider whether there should be a stay of the further examination on the ground of prejudice to Mr Ruzehaji. As discussed above, more is required than the mere existence of criminal proceedings. Mr Ruzehaji merely asserts in his affidavit that he “anticipates” that he will be required to address matters “directly relevant” to the criminal charges. This does not meet the burden which he must discharge. Mr Ruzehaji has failed to demonstrate any specific prejudice. His evidence is to be contrasted with the evidence relied on in Zhao, which stated the type of evidence the individual would be required to give and how it was directly relevant to the criminal proceedings. Importantly, in the present proceeding there is an undertaking that the examination will not address the subject matter of the criminal charges. The defendants’ submissions infer that Mr Ruzehaji would suffer prejudice if examined. This is not evidence of prejudice but speculation which has no evidentiary basis and ignores the undertaking which has been provided to the Court. There is no evidence Mr Ruzehaji will suffer prejudice if other persons are examined. His assertions in respect of self-incrimination have no application to examinations of other persons. As a consequence, the risk of prejudice to Mr Ruzehaji is not “plain” or “real”.
On the hearing of the appeal, senior counsel appearing for the Commissioner expressly confirmed the undertaking referred to above, namely that the examination would not address the subject matter of the criminal charges.
[Footnote omitted.]
[2] Ruzehaji v Commissioner of the Australian Federal Police [2015] SASCFC 182, [92]-[93].
The Application
In Schuller v S J Webb Nominees Pty Ltd (No 2), this Court summarised the principles concerning the Court’s power to award costs in the following terms:[3]
The award of costs is in the discretion of the court and the court may award costs on any basis it considers appropriate.[4] As a general rule, costs follow the event.[5]   That general rule is subject to specific rules to the contrary and to prescribed exceptions, none of which are relevant to this case.[6] The court’s discretion as to costs is absolute and unfettered, except that it must be exercised judicially, not arbitrarily or capriciously, and it cannot be exercised on grounds unconnected with the litigation.[7]
[3]    Schuller v S J Webb Nominees Pty Ltd (No 2) [2015] SASCFC 190, [2].
[4]    Supreme Court Act 1935 (SA) s 40(1).
[5] 6SCR 263(1).
[6] 6SCR 263(2).
[7]    Cretazzo v Lombardi (1975) 13 SASR 4 per Bray CJ at 11.
The appellants opposed the making of the usual order as to costs. It was submitted that the undertaking given to this Court by the respondent went further than the undertaking offered by the respondent in the District Court and was only given on the last day of the hearing of the appeal. It was further submitted that the proceeding raised an issue of public importance. In the circumstances, the appellants sought their costs of the appeal up until the respondent proffered the undertaking, being the first three days of the appeal.
The respondent sought the usual order as to costs. It was submitted that the undertaking given to this Court was no different to that proffered in the District Court on 20 September 2013 and communicated to the solicitors for the appellants on 19 August 2013.
It may be accepted that, on the hearing of the appeal, the wording of the respondent’s undertaking changed slightly. However, the substantive effect was unchanged. Whichever wording was adopted, the respondent had undertaken that the examination of the first appellant would not address the subject matter of his criminal charges. In the event the respondent decided to change his position, the first appellant would be given notice prior to the examination, which would allow him to make an application to address any prejudice that might arise. Properly understood, the first appellant’s position was not improved by the bringing of the appeals and the application for judicial review.
As noted earlier in these reasons, the appellants were unsuccessful in their appeals and application for judicial review. It may be accepted that the matter raised issues of public importance. However, in my view, this does not warrant a departure from the usual order as to costs.
Conclusion
I would order that the respondent have his costs of the appeal to be taxed or agreed on a party and party basis.
PEEK J.
I agree with the order proposed by Gray J and with his reasons.
NICHOLSON J.
I agree with Gray J.