Federal Court of Australia

Roberts-Smith v Fairfax Media Publications Pty Ltd (Costs) [2025] FCAFC 122

ORDERS

THE COURT ORDERS THAT:

1.    The respondents’ costs of the proceedings be determined in a lump sum if not agreed.

2.    The respondents’ interlocutory application filed on 23 May 2025 be otherwise dismissed.

3.    There be no order as to costs in relation to the interlocutory application filed on 23 May 2025.

4.    The parties confer over the following 14 days to see if agreement can be reached on the question of costs.

5.    The respondents file their evidence in chief on the quantum of the lump sum costs within a further 14 days.

6.    The appellant file his evidence within a further 14 days.

7.    The respondents file any written submissions on the quantum of the lump sum costs order within a further 14 days.

8.    The appellant file any written submissions in response within a further 14 days.

9.    The matter thereafter be referred for determination by a Registrar on the papers.

10.    Either party may contact the chambers of Perram J to have the matter relisted if a difficulty arises.

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

REASONS FOR JUDGMENT

PERRAM AND KENNETT JJ

1    Before the Court are three issues relating to the costs of the appeal:

(a)    should the appellant be ordered to pay the costs of the appeal on an indemnity basis rather than on the ordinary party-party basis?

(b)    should the Full Court’s order that the appellant pay the respondents’ costs of the re-opening application be vacated and be replaced with an order that there be no order as to costs in relation to that application?

(c)    should there be an order that the costs be determined on a lump sum basis?

INDEMNITY COSTS OF THE APPEAL

2    The respondents seek the imposition of an indemnity costs on the basis that the appellant knew that the imputations pleaded against him were true. There are two issues. First, did the appellant know that the imputations were true? Secondly, if he did, does this justify the imposition of an indemnity costs order?

Did the appellant know that the imputations were true?

3    The respondents submits that the appellant must have known the imputations were true which the appellant denies.

4    It is convenient to begin by focussing on one of the allegations concerning Whiskey 108. The appellant alleged that he had been defamed by publications which conveyed the imputation that whilst a member of the Special Air Service Regiment (‘SASR’) he had committed murder by pressuring a newly deployed and inexperienced SASR soldier to execute an elderly, unarmed Afghan in order to ‘blood the rookie’. The trial judge found the imputation conveyed that the appellant had ordered Person 4 to execute the old man in the courtyard and that Person 4 had done so. The trial judge therefore found the defence of substantial truth made out. The fact that Person 4 had killed the old man was not disputed on appeal. On appeal, this Court rejected the appellant’s contention that the evidence for the murder was not sufficient to discharge the respondents’ burden of proof.

5    The appellant submits that it does not follow from the findings made by the trial judge that he knew that the imputation was true. We would accept that in some cases this submission may be tenable. For example, a defendant may publish of a doctor that he or she engaged in professional misconduct by performing some novel procedure not supported by the wider medical profession. In a defamation proceeding by the doctor the defendant might succeed in a truth defence by proving that the doctor had engaged in professional misconduct by using the novel procedure and in the course of doing so the Court might reject the doctor’s evidence about the procedure’s efficacy. But the doctor’s belief in the soundness of the procedure might nevertheless be sincere although misguided. In such a case, it is possible to see that the success of the truth defence does not necessarily entail that it should have been obvious to an applicant that their case was doomed to fail: Herron v HarperCollins Publishers Australia Pty Ltd (No 4) [2021] FCA 1021 (‘Herron’) at [22]-[23] per Jagot J.

6    However, even accepting that to be so we do not agree that the trial judge’s finding that the appellant had ordered Person 4 to murder the old man is susceptible to that kind of analysis. Unlike the honest but misguided ‘perception of historical injustice’ held by Drs Gill and Herron about their own professional competence, we do not see how the appellant could have had an honest but misguided belief that he had not ordered Person 4 to execute the old man in the courtyard once it was found that he had indeed ordered the murder. The truth of the imputations does not turn, as it did in Herron, on matters of opinion. To put it another way, ordering another soldier to execute an old man kneeling on the ground is not an ambiguous situation. So too, we do not see how the finding that the appellant executed the man with the prosthetic leg with a burst of machine gun fire after frogmarching him to a place outside the compound is susceptible to any ambiguity which might make it plausible that the appellant did not know that what he was doing was murder. For the same reasons, we do not accept the appellant’s submission that he did not know that the imputations concerning the murders at Darwan and Chinartu were true.

Indemnity Costs

7    Turning then to the question of whether that conclusion justifies the imposition of an indemnity costs order, we do not think that it does. Section 43 of the Federal Court of Australia Act 1976 (Cth) confers a broad discretion in relation to the costs of proceedings and this extends, in an appropriate case, to an award of indemnity costs. Such an order is not punitive but compensates the opposing party for the costs associated with litigation misconduct of the kind described by Sheppard J in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 (‘Colgate-Palmolive’) at 233. Relevantly these include the wilful disregard of known facts, or the making of allegations which ought never to have been made, or the undue prolongation of a case by groundless contentions.

8    At trial the appellant sought to prove that he was innocent of the four murders and gave evidence explaining how the four men had been lawfully killed. He called other witnesses to support this case. It may thus be said that at trial the appellant did pursue a case that the imputations were not true. The trial judge rejected this case.

9    On appeal, the appellant did not seek further to pursue that case. His point on appeal was not that his evidence that he was innocent of the murders should have been accepted by the trial judge. Rather it was that the evidence that was adduced by the respondents was not sufficient for the purposes of s 140 of the Evidence Act 1995 (Cth) to justify the serious conclusion that he was a murderer. In pursuing that case, the appellant did not seek to prove that he did not commit the murders, only that the evidence that he had done so was legally insufficient.

10    In our view, this case was reasonably available to the appellant. Although we did not ultimately accept the appellant’s case about this, the factual situations in each of Whiskey 108, Darwan and Chinartu were very complex and there were inconsistencies and anomalies in the evidence. There was therefore a proper basis for the appellant’s advisors to file the appeal and pursue their submissions about s 140 in the manner that they did.

11    The question which now arises is whether it is possible for the appellant’s pursuit of the appeal to involve litigation misconduct of the kind described in Colgate-Palmolive if, as we accept, there was a reasonable basis for his submissions about s 140.

12    The respondents rely on Farrow v Nationwide News Pty Ltd (2017) 95 NSWLR 612 for the proposition that it is an abuse of process to commence a defamation proceeding:

(a)    to seek damages for a defamatory imputation he or she knows to be true; or

(b)    to obtain a remedy to which the plaintiff is indisputably not entitled or else to put a defendant to proof of that which cannot be denied.

13    They draw attention to a passage in the reasons of McCallum J at [35] (with whom Basten and Sackville JJA agreed):

It does not follow that a plaintiff can properly institute an action seeking damages for a defamatory imputation he or she knows to be true. In my respectful opinion, it is manifestly an abuse to invoke the court’s process to obtain a remedy to which the applicant is indisputably not entitled or else put a defendant to proof of that which cannot be denied.

14    This principle has no application to the present case. The appellant has not commenced a defamation action knowing that the imputations are true. Rather, he has commenced an appeal contending, on reasonable grounds, that the evidence at trial was not sufficient to warrant the findings made against him by the trial judge. Although we have upheld the primary judge’s findings, and it therefore remains the case that the appellant was seeking an ultimate outcome predicated on the falsity of imputations which he must have known were substantially true, he did not advance a positive (and dishonest) case against those imputations in the appeal. The appellant did no more than avail himself of the right of a litigant, against whom serious allegations are made, to put the other side to proof. The pursuit of the appeal therefore does not have the same impropriety as the appellant’s conduct of the trial.

15    There can be cases where putting a party to proof of their case may involve an abuse of process. Farrow is an example. It was concerned with an application by a convicted felon for leave to continue a defamation proceeding under s 5 of the Felons (Civil Proceedings) Act 1981 (NSW). Before granting leave under s 5 to proceed with such a case, the District Court below had to be satisfied that the proceeding was ‘not an abuse of process’. McCallum J’s statement in the Court of Appeal was made in the context of imputations identified as imputations (g), (h) and (i). These were that Ms Farrow had been sentenced to a term in prison after she was convicted of criminal offences, she was in gaol and would remain there until at least 2018 and that she had skipped bail. Each of these was a matter of public record and, equally importantly, Ms Farrow accepted that they were true in the Court of Appeal. It was in that context that McCallum J made the above observations.

16    This case differs from Farrow in three material ways. First, this case is concerned with an appeal in which the appellant is not asserting that the imputations are not true but only that the respondents have not discharged their burden of proving that they are true. Secondly, the evidence against the appellant – unlike the evidence against Ms Farrow – is not a matter of indisputable public record and it has never been accepted by the appellant to be true. Thirdly, although we have not accepted the appellant’s s 140 challenge it cannot be said that it was without substance.

17    The respondents relied upon a series of cases in which trial judges have awarded indemnity costs where a party has given false evidence: Degmam Pty Ltd v Wright (No 2) [1983] 2 NSWLR 354, Thors v Weekes (1989) 92 ALR 131, Re Talk Finance & Insurance Services Pty Ltd [1994] 1 QdR 558, Lee v Mavaddat [2005] WASC 68 (S), Southern Cross Mine Management Pty Ltd v Ensham Resources Pty Ltd [2006] QSC 7 and Fang v Sun (No 2) [2014] NSWSC 1194. None of those cases deals with an appeal where the question is whether the successful party has discharged their burden of proof.

18    Colgate-Palmolive requires this Court to ask whether the appellant conducted his appeal in wilful disregard of known facts, or by the making of allegations which ought never to have been made or the undue prolonging of the appeal by groundless contentions. In our view, the appellant did none of these things. In those circumstances, there is no reason to make an indemnity costs order.

19    For completeness, it is worth noting that the primary judge accepted that an award of indemnity costs was appropriate given that the appellant must have known the imputations were substantially true at the time he commenced the proceeding. At trial, the appellant pursued an argument, separate from his affirmative case, that the respondents had not discharged their onus of proof. It may be possible to imagine that the trial judge could have reasoned in relation to that latter aspect of the appellant’s defence that indemnity costs were not appropriate on the same basis we have explained above.

20    However, we do not think that this would be a correct view. The way the case was presented on appeal involved a clear delineation of the appellant’s case that the respondents had not discharged their burden of proof. However, no such clear delineation was possible at trial. For example, once the appellant’s affirmative case was found to be false it opened up a line of attack for the respondents based on the appellant’s consciousness of guilt; i.e., why make up a false account of an engagement if not to hide the truth of one’s own guilt. So too, the rejection of the appellant’s affirmative case that he shot the old man outside the compound naturally tended to increase the strength of the respondents’ case that the old man had been executed in the courtyard. Many such examples may be imagined. The clean delineation between the appellant’s affirmative case and his case of putting the respondents to proof did not exist at trial. There is therefore no inconsistency between the primary judge’s approach to the costs of the trial and the position at which we have arrived in relation to the costs of the appeal.

21    Prayer 1(a) of the respondents’ interlocutory application should be dismissed.

costs of the interlocutory applications

22    In their interlocutory application the respondents sought the making of indemnity costs orders in respect of five interlocutory applications. However, the respondents did not pursue these matters in their written submissions and we take them not to be pressed. Consequently, the appropriate order is that Prayers 1(b)-(f) be dismissed.

23    The appellant then submitted that there should be no order as to costs in respect of his re-opening application because it had a public interest character and raised a novel point. It will be recalled that the Court dismissed that application with costs on 16 May 2025: Roberts-Smith v Fairfax Media Publications [2025] FCAFC 66. We would reject the appellant’s submission for two reasons. First, there is no application before the Court to revoke the costs order of 16 May 2025. Secondly, we do not agree that the re-opening application had a public interest character and we do not think it raised a question of general importance or difficulty.

Lump sum costs order

24    The respondents submit that the costs should be subject to a lump sum costs order on the basis that the matter was a large and complex one. They drew attention to the fact that the hearing of the appeal had extended over 10 days and involved very expanded page limits. To that one might add that there was a thicket of interlocutory applications leading up to the re-opening application which itself took two days.

25    The appellant resisted a lump sum costs order on the basis that the size of the appeal and the expanded page limits did not demonstrate that there would be any particular difficulty or complexity in conducting a taxation of those costs.

26    We do not agree. The proceedings were unusually complicated. Much of the file is subject to non-publication orders of various kinds and some parts of the parties’ submissions and this Court’s reasons are subject to national security restrictions. The taxation of the respondents’ costs will be a complex undertaking. The appeal presents as a clear one for assessment on a lump sum basis. There should be a lump sum costs order.

result

27    Both parties have had some success. The parties should bear their own costs of this interlocutory application.

28    We make the following orders:

(a)    The respondents’ costs of the proceedings be determined in a lump sum if not agreed.

(b)    The respondents’ interlocutory application filed on 23 May 2025 be otherwise dismissed.

(c)    There be no order as to costs in relation to the interlocutory application filed on 23 May 2025.

(d)    The parties confer over the following 14 days to see if agreement can be reached on the question of costs.

(e)    The respondents file their evidence in chief on the quantum of the lump sum costs within a further 14 days.

(f)    The appellant file his evidence within a further 14 days.

(g)    The respondents file any written submissions on the quantum of the lump sum costs order within a further 14 days.

(h)    The appellant file any written submissions in response within a further 14 days.

(i)    The matter thereafter be referred for determination by a Registrar on the papers.

(j)    Either party may contact the chambers of Perram J to have the matter relisted if a difficulty arises.

Associate:

Dated:    4 September 2025

SCHEDULE OF PARTIES