FEDERAL COURT OF AUSTRALIA

CSL Australia Pty Limited v Minister for Infrastructure and Transport (No 2) [2014] FCAFC 35

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1.     The first respondent pay 40% of the appellant’s costs of the appeal and cross appeal.

2.    Order 1 made by the primary judge on 12 October 2012 be varied by deleting the words “with costs”.

3.    In the proceedings before the primary judge it be ordered that:

“1.    The first respondent pay 40% of the applicant’s costs.

2.    By consent, all costs orders as between the applicant and second respondent be vacated.”

THE COURT NOTES THE AGREEMENT BETWEEN THE APPELLANT AND SECOND RESPONDENT THAT:

4.    There be no orders as to costs as between them in the appeals and the proceedings before the primary judge.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1.    The orders made on 26 February 2014 be varied by:

(1)    inserting the word “first” before “respondent” in order 2(a);

(2)    deleting order 2(c);

(3)    adding the following orders in order 2:

“(c)    the first respondent pay the applicant’s costs of the interlocutory application filed on 14 February 2013.

(d)    save as provided in orders 2(c) and 4, the costs of the proceedings be the parties’ costs in the Full Court proceedings NSD 2083 of 2012.”

(4)    deleting order 4 and substituting:

“The first respondent pay the appellant’s costs of the appeal related to the first respondent’s interlocutory application filed in the proceedings before the primary judge on 14 February 2013.”

THE COURT NOTES THE AGREEMENT BETWEEN THE APPELLANT AND SECOND RESPONDENT THAT:

2.    There be no orders as to costs as between them in the appeals and the proceedings before the primary judge.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

REASONS FOR JUDGMENT

THE COURT:

1    On 26 February 2014, the Full Court made substantive orders in each of these two appeals and published its reasons for those orders: CSL Australia Pty Ltd v Minister for Infrastructure and Transport [2014] FCAFC 10. The Full Court invited submissions on costs in respect of the proceedings on appeal from Robertson J, but made orders that dealt with the costs before Katzmann J and on the appeal.

The uncontentious costs orders

2    On 28 February 2014, Rio Tinto filed an interlocutory application seeking to vary the costs orders made in the appeal from Katzmann J’s orders. The application drew attention to a slip in order 2(a) made on 26 February 2014, where the word “first” had been accidently omitted in the order that Katzmann J should have made, namely “dismiss the interlocutory application of the first respondent”. Only the Minister had applied to her Honour to dismiss or stay the proceedings before her, and Rio Tinto did not participate in that interlocutory hearing. The error should be corrected. However, the correction of that error also requires, as the Minister has accepted, that separate orders be made that the Minister pay CSL’s costs of his failed interlocutory application before Katzmann J and, in relation to that application, of the appeal.

3    The parties also submitted that order 2(c) made on 26 February 2014 be varied so that the balance of the parties’ costs on the case stated be their costs in the appeal from Robertson J. Such a variation is also appropriate since the arguments on both substantive appeals largely overlapped.

4    CSL also sought an order that the Minister pay its costs of Rio Tinto’s interlocutory application made on 28 February 2014 to vary the Full Court’s orders. However, that is not appropriate given that the orders made by the Full Court on 26 February 2014 had not fully addressed the matters that Rio Tinto properly raised in that interlocutory application.

5    Following the delivery of its reasons, CSL and Rio Tinto informed the Full Court that they have reached agreement as between them in both of the primary proceedings and both appeals that, first, all previous costs orders should be vacated, secondly, there should be no orders as to costs, and thirdly, whatever may be the outcome of any appeal or cross-appeal from any of the Full Court’s orders, those two sets of costs orders should not be disturbed. In those circumstances, it is appropriate to make orders reflecting the agreement of CSL and Rio Tinto.

6    Robertson J did not make any final order for costs in the proceedings before him, but reserved those costs on 2 November 2012.

Contentious costs orders – the parties’ submissions

7    The Minister submitted that each party should bear its or his own costs of the proceedings before Robertson J, and as they flowed through to the disposition of the stated case from the matter that had been before Katzmann J. He argued that the parties’ differential successes and failures in the end result on appeal warranted such an order.

8    CSL argued that the Minister should pay 50% of its costs of the proceedings before Robertson J, including the interlocutory application in which his Honour dismissed its claim for an interlocutory injunction with costs, and its costs of the appeal. CSL accepted that since it had made its own arrangements with Rio Tinto, it would not be appropriate to make a singular costs order against the Minister for all of its costs.

Contentious costs orders – consideration

9    CSL succeeded in respect of the centrally important issue in both appeals, namely whether the delegate erred in having regard to the issues of freight rates and liquidated damages as mandatory considerations under s 34(3) of the Coastal Trading (Revitalising Australian Shipping) Act 2012 (Cth). In consequence, the Full Court held that Robertson J erred in limiting the declaratory relief be granted and that, accordingly, the second decision of the delegate was also affected, and thus invalidated, by that error. It would not be appropriate to deny CSL the benefit of any order for its costs in those circumstances. While the Minister succeeded, by majority, in part on his cross-appeal, that would not have resulted in the first delegate’s decision remaining in place. Moreover, the substantive proportion of time taken during the hearing and in argument dealt with the proper construction of the Act and the ways in which the Minister (or delegate) was authorised to have regard to the central issues of freight rates and liquidated damages.

10    The Minister is the sole party who will have to bear costs, in light of the agreement reached between CSL and Rio Tinto. Given his relative lack of success, we consider that he should be ordered to pay 40% of CSL’s costs of the proceedings before Roberston J (including the costs of CSL’s unsuccessful application for an interlocutory injunction that Robertson J determined and the appeal from his Honour’s substantive orders). The consequence of the costs order agreed between all the parties, that their costs of the case stated should be costs in the appeal from Robertson J, is that the Minister should pay 40% of CSL’s costs of the stated case, the proceedings before, and on appeal from, Katzmann J.

Associate:

Dated:    28 March 2014