Federal Court of Australia

Atanaskovic Hartnell Corporate Services Pty Limited v Kelly (No 2) [2024] FCAFC 147

ORDERS

THE COURT ORDERS THAT:

1.    The respondent be granted a certificate to the effect that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under s 6 of the Federal Proceedings (Costs) Act 1981 (Cth) to the respondent in respect to the costs incurred by the respondent in relation to the appeal.

2.    The respondent be granted a certificate to the effect that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under s 8 of the Federal Proceedings (Costs) Act 1981 (Cth) to the respondent in respect to costs to be incurred by the respondent in relation to the new trial.

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

REASONS FOR JUDGMENT

THE COURT:

1    On 31 October 2024, we made orders allowing an appeal from the Federal Circuit and Family Court of Australia (Division 2) and remitting the proceedings for re-trial; and published our reasons for doing so: Atanaskovic Hartnell Corporate Services Pty Limited v Kelly [2024] FCAFC 137 (Atanaskovic (No 1)). We also made orders allowing the parties to apply for orders in relation to costs, including orders under the Federal Proceedings (Costs) Act 1981 (Cth) (Costs Act).

2    The respondent has applied for orders under ss 6 and 8 of the Costs Act. These reasons for judgment address that application.

3    Sections 6 and 8 of the Costs Act provide, in so far as is presently relevant:

6      Costs certificates for respondents—Federal appeals

(1)     Subject to this Act, where a Federal appeal succeeds on a question of law, the court that heard the appeal may, on the application of a respondent to the appeal, grant to the respondent a costs certificate in respect of the appeal.

...

(3)     The certificate that may be granted under subsection (1) or (2) by a court to a respondent to a Federal appeal is a certificate stating that, in the opinion of the court, it would be appropriate for the Attorney-General to authorize a payment under this Act to the respondent in respect of:

(a)     the costs incurred by the respondent in relation to the appeal;

...

8      Costs certificates—new trials

(1)     Subject to this Act, where, in a Federal appeal that succeeds on a question of law, the court that heard the appeal grants a new trial in a cause of a civil nature, the court may, on the application of a party to the cause, grant to the party a costs certificate in respect of the new trial.

...

(3)     The certificate that may be granted under subsection (1) or (2) to a party to a cause or to an accused person, as the case may be, by a court that has granted a new trial is a certificate stating that, in the opinion of the court, it would be appropriate for the Attorney-General to authorize a payment under this Act to that party or accused person in respect of such part as the Attorney-General considers appropriate of any costs incurred by that party or accused person in relation to the new trial.

4    Sections 6 and 8 contain a discretion to make an order granting a costs certificate with respect to an appeal and a new trial respectively. In each case, the discretion is enlivened upon satisfaction of several preconditions.

5    For both ss 6 and 8, there must be a “Federal appeal” that has succeeded on a question of law. That is so in the present case. “Federal appeal” is defined relevantly in s 3(1) of the Costs Act in a manner which includes “(fa) an appeal to the Federal Court from a judgment of the Federal Circuit and Family Court of Australia (Division 2)”. That appeal succeeded on a question of law, as was noted in Atanaskovic (No 1) at [63] (Collier J) and [153] (Logan J).

6    For s 6, there is an additional precondition, namely that the application for a costs certificate has been made by a respondent to the appeal. Again, that is satisfied in the present case.

7    For s 8, there are two additional preconditions. The first is that this Court has granted a new trial in a cause of a civil nature. As noted above the proceeding was remitted for re-trial, and the underlying cause is of a civil nature. The second is that a party to the cause has applied for a certificate. As noted above, this has occurred.

8    Thus, the discretions conferred by each of ss 6 and 8 have been enlivened. Each discretion is broad and the considerations which inform their exercise overlap. In Minister for Immigration and Border Protection v MZZMX (No 2) [2020] FCAFC 214; (2020) 385 ALR 283, the Full Court (Murphy, O’Callaghan and Anastassiou JJ) explained at 284 to 285 [6]:

The discretion conferred by s 6(1) is a broad one: see, eg, Minister for Immigration and Border Protection v Kaur (No 2) [2015] FCA 748 at [5] (Yates J); Minister for Immigration and Citizenship v SZNVW (No 3) [2010] FCAFC 102 at [3] (Keane CJ, Emmett and Perram JJ); Minister for Immigration and Citizenship v Khadgi (No 2) [2010] FCAFC 152 at [5] (Stone, Foster and Nicholas JJ). Relevant considerations include:

(a)    whether there are any matters which would disentitle the respondent to the issue of a certificate, such as the conduct of the respondent in respect of the litigation and any prejudice thereby occasioned to the appellant: see, eg, Minister for Immigration and Citizenship v Kamruzzaman [2011] FCA 1095 at [19] (Greenwood J); Minister for Immigration and Border Protection v CQZ15 (No 2) [2018] FCAFC 19; 259 FCR 569 at [29] (Kenny, Tracey and Griffiths JJ);

(b)    whether the respondent is an individual or a well-resourced company or government entity: see, eg, Minister for Immigration and Citizenship v Sok (No 2) [2008] FCAFC 52 at [9] (French, Lindgren and Jacobson JJ); Kamruzzaman at [18];

(c)    whether the decision on the appeal was significant beyond the particular case and had wider importance or relevance to the administration of the Migration Act 1958 (Cth): see, eg, SZNVW at [3]; CQZ15 (No 2) at [29];

(d)    whether it would have been unreasonable or unrealistic to expect the respondent to have undertaken the burden of the appeal without legal representation: see, eg, Kaur at [10]; and

(e)    whether the existence of a debt to the Commonwealth may provide a basis for refusing the grant of visas other than protection visa pursuant to Schedule 4, item 4004 of the Migration Regulations 1994 (Cth): see, eg, SZNVW at [4].

(emphasis in original)

9    While the discretion conferred by each of ss 6 and 8 is broad, we note that the present application for a costs certificate is brought in a no costs jurisdiction. However, the Full Court in Security & Technology Services (NT) Pty Ltd v Hurley [2022] FCAFC 90 (referred to by Collier J at [63] in Atanaskovic (No 1)) granted a costs certificate in a no costs jurisdiction and stated:

[14]    The injustice that results is even more lamentable because the significant amounts of money which both parties no doubt have spent on legal costs are not recoverable in the Fair Work jurisdiction. The fact that the parties themselves will have to bear those costs through no fault of their own is a most regrettable result of the inevitable outcome of this appeal.

[15]    Mr Hurley applied for the grant of a cost certificate pursuant to ss 6 and 8 of the Federal Proceedings (Costs) Act 1981 (Cth). In light of the reasons we have given, it is, in our opinion, appropriate for the Attorney-General to authorise payment under that Act to Mr Hurley in respect of the costs he incurred in relation to the appeal and the new trial.

10    In our view, the conclusion of the Full Court in Hurley is applicable in the present case, such that a costs certificate is available to be ordered if the Court so determines. Without such an order, the appeal is in a no costs jurisdiction and the parties will have to bear the costs of the appeal and the new trial through no fault of their own.

11    We are satisfied, in the circumstances of the present case, that the orders sought by the respondent should be made. In particular:

(1)    the appeal succeeded, and the remittal was necessary, because of a judicial error, for which no party was responsible (see Atanaskovic (No 1) at [61] to [63] and [153]);

(2)    the reasoning in Atanaskovic (No 1), concerning the reproduction of submissions in reasons for judgment, has a wider relevance beyond the present case: see MZZMX at 285 [6(c)] and Lopez v Gold Titan Pty Ltd (No 2) [2022] FCAFC 146 at [15] to [16] (Rares, Stewart and Goodman JJ);

(3)    the respondent is an individual who acted reasonably in obtaining legal representation for the purpose of the appeal (and who would be acting reasonably in obtaining such representation for the new trial): see MZZMX at 285 [6(b) and (d)]; and

(4)    there is an absence of any evidence of disentitling conduct on the part of the respondent: see MZZMX at 284 [6(a)].

12    Further, although both ss 6 and 8 are expressed to operate subject to the remainder of the Costs Act, there is no impediment in the remainder of the Costs Act to the making of the orders sought. For example, the respondent is not a person upon whom s 14 of the Costs Act operates.

13    We also consider it appropriate to draw attention to the “prescribed maximum amount” which, by s 18 of the Costs Act, makes a “cap” applicable to costs certificates issued under ss 6, 7, 7A, 8, 9 and 10A (but not s 10) of that Act. The prescribed maximum amount is fixed by reg 6 of the Federal Proceedings (Costs) Regulations 2018 (Cth) (Costs Regulations). In relation to this Court, that maximum is $6,000.00. Regulation 6 of the Costs Regulations was last amended in 2021 (by the Federal Circuit and Family Court of Australia Legislation (Consequential Amendments and Other Measures) Regulations 2021 (Cth)) and then only as a consequence of the establishment of the Federal Circuit and Family Court of Australia. Thus, the relatively modest prescribed maximum amounts were last fixed in 2018. Necessarily, the extent to which an amount payable pursuant to a certificate achieves a beneficial purpose intended by the Costs Act has been eroded by changes in the value of money and the cost of legal services since 2018. We respectfully suggest that the various prescribed maximum amounts may warrant attention by the Attorney-General as the Minister responsible for the administration of the Costs Act.

14    Orders will be made accordingly.

Associate:

Dated:    14 November 2024