Federal Court of Australia

Zhu v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (No 2) [2026] FCAFC 4

ORDERS

THE COURT ORDERS THAT:

1.    The applicant pay the first and third respondents’ costs of, and incidental to, the proceedings BRG193/2022, as agreed or taxed.

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

REASONS FOR JUDGMENT

THE COURT

INTRODUCTION

1    On 11 August 2025, the Full Court of the Federal Court of Australia delivered judgment in Zhu v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2025) 311 FCR 237; [2025] FCAFC 101 (AJ or appeal judgment), dismissing the appeal and ordering that the appellant pay the costs of the appeal. No orders were made concerning the costs of the hearing before the primary judge and the parties were directed to file written submissions concerning the costs of the proceedings below. The parties have indicated that they rely on their submissions before the primary judge on the question of costs. These reasons assume familiarity with the appeal judgment and adopt the abbreviations used in the reasons of Meagher J.

2    Mr Zhu contends that there should be no order as to costs on the basis that the matter has an element of public interest. Alternatively, he submits that costs should be fixed in accordance with Sch 2 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth). The Ministers submit that Mr Zhu should pay the costs as agreed or taxed pursuant to r 22.02(2)(b) of the Rules. In this regard, they rely on an affidavit of Ms Brooke Griffin dated 10 May 2024 (Costs Affidavit).

3    For the reasons set out below, we accept the Ministers’ submission.

LEGISLATIVE FRAMEWORK

4    The parties were in agreement as to the applicable legislative provisions.

5    Section 214(2) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (the legislation in force at the time) provides that “[t]he Federal Circuit and Family Court of Australia (Division 2) or a Judge has jurisdiction to award costs in all proceedings before the Court” unless there exists another Act which prohibits the award of costs for particular proceedings. Furthermore, unless another Act or the Rules of the Court, including the Rules (the legislation in force at the time), provide otherwise, costs are discretionary: s 214(3) of the Act.

6    Subsequently, the Act has been amended in respect of s 214(1), insofar as the proceedings to which s 214 applies have been further limited, although none of those categories of proceeding are presently relevant.

7    Rule 22.02 of the Rules provides as follows:

22.02 Order for costs

(1)    An application for an order for costs may be made:

(a)    at any stage in a proceeding; or

(b)    within 28 days after a final decree or order is made; or

(c)    within any further time allowed by the Court.

(2)    In making an order for costs in a proceeding, the Court may:

(a)    set the amount of the costs; or

(b)    set the method by which the costs are to be calculated; or

(c)    refer the costs for taxation under Part 40 of the Federal Court Rules; or

(d)    set a time for payment of the costs, which may be before the proceeding is concluded.

8    In respect of an application for a costs order pursuant to r 22.02(1) of the Rules, subsection (2) of that rule enables the Court to “set the amount” of costs, “set the method” for the calculation of costs, “refer the costs for taxation” as per Pt 40 of the Federal Court Rules 2011 (Cth) (FCR), or “set a time for payment of the costs”.

9    With respect to the taxation of costs contemplated by r 22.02(2)(c) of the Rules, Part 40 of the FCR relevantly relates to ‘Costs’ and includes Division 40.2 entitled ‘[t]axation of costs’. Rule 40.29(b) of the FCR provides that “[a] taxing officer is to allow costs for the work done” which occurs “on or after 1 August 2011—in accordance with Schedule 3, for the relevant period, if any, mentioned in that Schedule”.

10    Rule 22.10(1) of the Rules also states that “[i]n taxing a statement of costs, a taxing officer must apply the scale of costs set out in Schedule 3 to the Federal Court Rules”. That Schedule is entitled “[c]osts allowable for work done and services performed”: Sch 3 to the FCR.

11    With the exception of proceedings to which the Bankruptcy Act 1966 (Cth) applies, under r 22.09 of the Rules “[u]nless the Court otherwise orders, a party entitled to costs in a general federal law proceeding” is also entitled to “costs in accordance with Schedule 2” and “disbursements properly incurred”. Where costs are incurred in a migration proceeding, r 29.13 of the Rules and Pt 2 of Sch 2 to the Rules apply: see Note 2 to r 22.09 of the Rules.

12    Rule 29.13 of the Rules is as follows:

29.13 Costs

(1)    The Court may, in relation to a proceeding that is concluded, order an unsuccessful party to the proceeding to pay the costs of a successful party in accordance with Division 1 of Part 2 of Schedule 2.

(2)    If:

(a)    the applicant files a notice of discontinuance in a proceeding in which a respondent has sought costs in the response; and

(b)    the applicant does not file with the notice an application in respect of costs;

a Judge or a Registrar may, without hearing the parties, make an order in chambers in accordance with Division 2 of Part 2 of Schedule 2 for the costs of the respondent.

(3)    This rule does not limit a party’s right to apply, under Part 22, for an order as to costs of the application.

Note 1: See Division 13.1 of these Rules in relation to discontinuance.

Note 2: See section 136 of the Act in relation to the exercise of jurisdiction in chambers.

13    Division 1 of Part 2 of Schedule 2 to the Rules relates to migration proceedings which have concluded, and in particular, item 3 refers to proceedings which concluded at a final hearing and specifies an amount, including GST, of $8,371.30 in respect of costs.

14    The Rules have been subsequently redrafted, but the amendments were not in existence at the time the proceedings below were heard and are inapplicable.

LEGAL PRINCIPLES

15    Although at one point the Ministers contended that FJS18 v Minister for Immigration, Citizenship and Multicultural Affairs [2024] FCA 433 was wrongly decided, that submission was ultimately not pursued and the parties agreed that that case embodied the guiding principles. We agree with Burley J’s decision in FJS18.

16    In FJS18, Burley J at [45] explained the interaction of the provisions of the Rules in the context of a migration proceeding as follows:

In a migration proceeding, if an application is made under r 22.02, then the Court must exercise its discretion to determine whether one of the other options in r 22.02(2) is more appropriate than the application of the Schedule 2 scale costs pursuant to r 29.13(1); see r 29.13(3).

Mr ZHU’s SUBMISSIONS

17    Mr Zhu contends that the order which should be made is that there be no order as to costs as this matter has an element of public interest, relying upon Ruddock v Vadarlis (No 2) (2001) 115 FCR 229; [2001] FCA 1865, wherein Black CJ and French J stated at [14] that “the concept of the ‘public interest’ is a very broad one” and one which encompasses a variety of circumstances possibly pertinent to “whether there should be a departure from the ordinary rule that costs follow the event”. At [17] of Ruddock, Black CJ and French J also acknowledged that “[w]here an appeal raises a novel question of much general importance and some difficulty the appeal court may decline to order costs against the unsuccessful appellant”. Mr Zhu also relies upon Hussain v Minister for Foreign Affairs (2008) 169 FCR 241; [2008] FCAFC 128 as an example of such an approach.

18    Ultimately, Mr Zhu contends that there should be no order as to costs on the basis that public interest criterion (PIC) 4003(b) of the Migration Regulations 1994 (Cth) “creates unfairness for visa applicants” because it precludes visa applicants from comprehending the decision-maker’s “substantive reasons” and prevents the determination being the subject of review. Further, Mr Zhu submits that the absence of previous, pertinent judicial consideration of PIC 4003(b) of the Act, and the potential for “clarification of the law”, serve the public interest. Mr Zhu also contends that he “acted reasonably” throughout the proceedings by narrowing the issues in contention.

19    Alternatively, Mr Zhu submits that in the event the Court orders costs in the Ministers’ favour, costs should be fixed as per Sch 2 of the Rules. To that end, Mr Zhu contends:

(a) The factors outlined above […] support a finding that there was an important public interest element to this case in respect of determining the validity of PIC 4003(b).

(b) The sum of costs allowed under Schedule 2 provides a reasonable balance between allowing the Respondents a partial indemnity of their actual costs and not imposing costs of resolving an important general principle of law on an individual applicant.

(Emphasis omitted.)

20    Should an order be made that he pay the Ministers’ costs, Mr Zhu submits that costs should be the sum of $8,371.30 as per Sch 2 of the Rules.

CONSIDERATION

21    Under r 214(3) of the Rules, the Court has a broad discretion to award costs, but it is obliged to exercise such discretion judicially and not arbitrarily: FJS18 at [30]. Accepting that, the discretion to award costs does not warrant a “rigidly mechanical approach”: FJS18 at [33]. Nonetheless, the overarching guiding principle “is that a party that is successful be permitted to recover so much of its costs as are reasonably incurred”: FJS18 at [34].

22    We do not find Mr Zhu’s submissions with respect to the appropriate order for, or quantum of, costs to be persuasive. For the reasons which follow, the appropriate order in this matter is that Mr Zhu pay the Ministers’ costs, as agreed or taxed.

23    First, we do not consider that the issues in this case rise to such a level of novelty as to warrant the displacement of the general rule with respect to costs. Although Mr Zhu’s case is “novel” in the sense that there is an absence of judicial consideration of PIC 4003(b), that alone is not sufficient to persuade us. We accept that, in Mr Zhu’s submission, “clarification of the law” with respect to the Ministers’ administration of the scheme holds a “wider public interest”, but this could be contended in respect of almost all laws. Indeed, almost every case could be conceived of as determining a novel point of law. Further, Mr Zhu has failed to identify any particular, compelling reason why clarification of the law in respect of PIC 4003(b) is in the public interest: cf Hussain at [183]. We accept the Ministers’ contention that a mere question of statutory interpretation is insufficient to support an assertion of public interest.

24    Secondly, as to the quantum of costs which should be payable, there is no requirement for this Court to afford any “bias or weighting” to an order for costs in accordance with Pt 2 of Sch 2 to the Rules, “such that there must be a ‘good reason’, ‘exceptional circumstances’ or a case of ‘unusual complexity’” before the Court determines that an order for costs should be made on the basis of any of the subsections of r 22.02(2) of the Rules: FJS18 at [46]. To adopt the words of Burley J in FJS18 at [49], the scale as set out in Pt 2 of Sch 2 to the Rules cannot “be considered to represent an assessment of costs of a migration case of ‘average complexity’ … or a ‘standard unit equivalent migration proceeding which concludes at a final hearing’”, quoting with disapproval SZUVZ v Minister for Immigration and Border Protection [2015] FCCA 2346 at [4] and AHE18 v Minister for Immigration, Citizenship and Multicultural Affairs (No 2) [2023] FedCFamC2G 257 at [4]. At any rate, there is doubt as to whether a Court could assess a case of “average complexity”: FJS18 at [49] and CIQ17 v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (No 2) [2020] FCCA 3467 at [27].

25    Mr Zhu has not identified any matters, whether considered apart or jointly, which would justify a departure from the ordinary principle of costs.

26    Thirdly, r 40.02(b) of the FCR enables a party entitled to costs to apply to the Court for costs to “be awarded in a lump sum, instead of, or in addition to, any taxed costs”.

27    The Ministers’ submissions, supported by the affidavit evidence, include a procedural chronology of the matter below, which relevantly sets out, inter alia, that Mr Zhu’s case evolved over the course of the proceedings and necessitated the filing, amending and re-filing of submissions, the adjournment of the first hearing date and the retention of counsel. The evolution of the case meant that the Ministers were obliged to expend significant effort in responding to the case as advanced.

28    The Costs Affidavit was given by Ms Griffin, a lawyer employed by the legal representatives for the Ministers. It was made by reference to the Court’s Costs Practice Note (GPN-COSTS) and r 40.02(b) of the FCR and Sch 3 thereto.

29    The summary of costs contained in the Costs Affidavit was made on a “party-party” basis and included fees which fell within the categories of “[a]ttendances”, “[p]reparing documents”, “[r]eading” and “[c]ollation”. Additionally, Ms Griffin deposes that the total amount of costs claimed, namely $44,261.63, includes “professional fees and disbursements” (emphasis omitted) incurred between 3 June 2022 and 8 May 2024, and that these fees have been discounted such that only “75% of the total fees incurred have been claimed”.

30    Having regard to this evidence, in our view it is appropriate that Mr Zhu pay the Ministers’ costs as agreed or taxed, as to award costs in accordance with Pt 2 of Sch 2 to the Rules would be inadequate. Costs in accordance with this schedule would not represent a fair indemnity for the Ministers’ costs as the successful parties to the proceedings: FJS18 at [59]. It is clear from the chronology of this matter that the Ministers have acted reasonably and responsively to the evolution of Mr Zhu’s case and his decision to retain counsel for the hearing below. Although not prepared with the assistance of an expert, the Costs Affidavit supports the Ministers’ contention that a more appropriate order for costs is as agreed or taxed, and an appropriate sum payable for costs and disbursements is $44,261.63.

31    Finally, Mr Zhu has not identified any matters or conduct on the part of the Ministers which would justify depriving them of the benefit of costs as the successful parties: Waterman v Gerling Australia Insurance Company Pty Ltd (No 2) [2005] NSWSC 1111 at [10]; Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at [69] and Northern Territory v Sangare (2019) 265 CLR 164; [2019] HCA 25 at [24] – [25]. The fact that he has acted reasonably in the conduct of the litigation does not justify depriving the Ministers of costs orders in their favour nor does it weigh in favour of an award of costs on the basis upon which Mr Zhu seeks them, that is fixed in accordance with Pt 2 of Sch 2 to the Rules.

32    Accordingly, Mr Zhu should be ordered to pay the Ministers’ costs of, and incidental to, the proceedings below as agreed or taxed. With respect to the quantum of costs, we consider that the Ministers’ estimation of costs is a reasonable indication of the costs and disbursements incurred by the Ministers in the proceedings.

conclusion

33    Mr Zhu is ordered to pay the Ministers’ costs of, and incidental to, the proceedings below as agreed or taxed.

Associate:

Dated:    10 February 2026