Sergei Sergienko v AXL Financial Pty Limited (Costs)

Sergei Sergienko, the applicant, sought a determination on the issue of costs following his successful action against AXL Financial Pty Limited, the respondent, in the Federal Circuit and Family Court of Australia. The applicant had initially sued the respondent for compensation relating to an alleged breach of the Australian Consumer Law and contravention of the Corporations Act 2001 (Cth). The respondent, in turn, raised a counterclaim for damages. The applicant later abandoned part of his claim, and the matter proceeded to a trial. The trial judge found in favour of the applicant on his remaining claims and in favour of the respondent on the counterclaim. The applicant subsequently sought an order that the respondent pay part of the costs of the abandoned claim, which the respondent opposed.

The court was required to determine whether it should order the successful party to pay the costs of a part of the other party’s claim that was abandoned. The court noted that the general rule is that the Court does not differentiate between issues on which the successful party won and those on which he did not. The court held that there was no basis on which the Court should depart from this general rule. The court found that it was not appropriate to order the successful party to pay part of the costs of a claim that was abandoned, as doing so would potentially penalise the successful party for exercising their right to abandon part of their claim.

The court concluded that the respondent was not liable to pay the costs of the applicant’s abandoned claim. The court noted that the general rule was supported by policy considerations, as it was in the interests of finality and efficiency to ensure that parties are not required to litigate issues that they have chosen not to pursue. The court emphasised that the general rule was not absolute and that there may be exceptional circumstances in which it would be appropriate to order a successful party to pay part of the costs of an abandoned claim. However, the court found that such circumstances were not present in this case.

In light of the above, the court dismissed the applicant’s application for an order that the respondent pay part of the costs of the abandoned claim. The court did not make any orders as to the costs of the proceedings.