Skelin v Self Care Corporation Pty Ltd (No 2)

Skelin v Self Care Corporation Pty Ltd (No 2) involves the issue of third-party costs orders, focusing on whether the wife and mother of the appellant, Pascal Skelin, were active participants in the litigation and whether they have a stake in the litigation's outcome. Skelin, an undischarged bankrupt, sought to discontinue his appeal against Self Care Corporation, an Australian medical services provider. Self Care opposed the discontinuance and sought third-party costs orders against Skelin's wife, Anne, and mother, Ojdana, arguing that they had funded his legal costs. The case hinged on whether these women had an active role in the litigation and if they had an interest in the proceedings' outcome.

The court had to determine whether hearsay evidence was admissible in the application for costs and if the costs orders sought in relation to the stay application were interlocutory. The court held that the legal effect of an order granting leave to file a notice of discontinuance is not a final determination of the parties' rights, making leave to appeal against costs orders necessary. Consequently, hearsay evidence was admissible, and the costs orders sought were considered interlocutory.

The court ruled that Anne and Ojdana Skelin did not have a sufficient connection to the unsuccessful party and the litigation to warrant the court exercising its jurisdiction to make third-party costs orders. The evidence provided by the Skelins' solicitor, which included information and belief, was deemed insufficient to establish their active participation or interest in the litigation. The court emphasised that the discretion under s 43 of the Federal Court of Australia Act 1976 would turn on the particular facts of each case.

The court granted Skelin leave to discontinue his appeal proceedings and ordered him to pay the costs, including those from a previous costs order. The respondents were ordered to pay Skelin's costs of their application for non-party costs orders. If the parties could not agree on the quantum of costs within 28 days, the matter would be referred to a Registrar of the Court for assessment and payment in a lump sum.