FEDERAL COURT OF AUSTRALIA

ACCC v Daniels Corporation Pty Ltd  [2001] FCA 936

Federal Court of Australia Act 1976 ss 20(1A), 43.

Preston Erection Pty Limited v Speedy Gantry Hire Pty Limited [1999] FCA 122 applied

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v DANIELS CORPORATION INTERNATIONAL PTY LIMITED

N 992 OF 2000

WILCOX, MOORE and LINDGREN JJ

28 JUNE 2001

SYDNEY

THE COURT ORDERS THAT:

1.                  The application by Daniels Corporation International Pty Limited to vary the costs order made on 16 March 2001 be refused.

2.                  The costs of this application be part of the costs payable to Australian Competition and Consumer Commission pursuant to that order.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

WILCOX J:

1                     Before the Court is an application by Daniels Corporation International Pty Limited (“Daniels Corporation”) to vary the orders made by the Court on 16 March 2001.  On that occasion the Court dealt with a preliminary question which had been referred to a Full Court by the Chief Justice pursuant to s 20(1A) of the Federal Court of Australia Act 1976.  The Court made an order that Daniels Corporation pay the costs incurred by the applicant, Australian Competition and Consumer Commission, in relation to determination of the referred point.

2                     Daniels Corporation subsequently applied for the Court to vary its order by setting aside the costs order.  Written submissions were supplied and we have heard oral argument in favour of that course being taken.  In the written submissions of Daniels Corporation, questions were raised as to the jurisdiction of a Full Court to make costs orders in relation to a referred question, but it was eventually conceded by Mr Brabazon, counsel for Daniels Corporation, that a Full Court had jurisdiction to deal with such costs.  This seems clearly correct, having regard to the terms of s 43 of the Federal Court of Australia Act.

3                     However, Mr Brabazon maintained the Court had no power to exercise that jurisdiction unless the matter of costs had been specifically raised before the Full Court by counsel as, for example, by way of a specific application for costs or, alternatively, the matter of costs had been raised by a member of the Bench.  When asked what authority there was for that view, Mr Brabazon referred to s 43 of the Federal Court of Australia Act and the rules of natural justice. 

4                     As to s 43, it seems to me that section does not assist him at all.  The section clearly confers jurisdiction.

5                     The reference to the rules of natural justice is misconceived.  Natural justice requires the provision of an opportunity to be heard in respect of a matter.  There was an opportunity to be heard in regard to costs, namely at the hearing of the preliminary question.  The problem, from the point of view of Daniels Corporation, is that no advantage was taken of that opportunity. 

6                     It seems to me the proposition put by Mr Brabazon is incorrect.  The Court had both jurisdiction and power to deal with the costs of determination of the preliminary question.

7                     Mr Brabazon also says that, as a matter of discretion, the Court should set aside the costs order.  He referred to various matters which, in his submission, support the view that this is a case where costs ought not to follow the event. 

8                     I do not express any view about the merit of the points made by Mr Brabazon regarding exercise of the Court’s discretion.  If the issue of costs had been raised at the hearing before the Full Court, I may have been attracted to these points; I may not have been. It is not appropriate to go into that question, because I am of the clear opinion that it would not be a correct exercise of the discretion of the Court to vary the order at this stage.

9                     It is important that parties understand the ordinary course of events in this Court. Normally, the matter of costs will be dealt with, one way or the other, at the time when judgment is delivered.  This statement applies to both trials and appeals.  The exception is where some specific arrangement or request is made in regard to costs.  To demonstrate this is the position, it is sufficient for me to refer to what was said by a Full Court in Preston Erection Pty Limited v Speedy Gantry Hire Pty Limited [1999] FCA 122.  In that case, which happened to be a patent case, a request was made to the Court, after delivery of judgment, to re-open the matter for the purpose of dealing with costs.  That request was refused.  In delivering reasons for refusal, the Court said (at paras 4-5):

“It was open to the respondent on the hearing of the appeal to advance argument that, in the event of the appeal succeeding, the appellants should not receive all their costs of the trial.  Or the respondent could have requested that, in the event of the appeal succeeding, it be given leave to put further submissions as to costs.  Neither course was adopted. As we have said, a respondent is at risk of having to meet the appellant’s costs of the appeal and the trial, should the appeal succeed.  We do not accept that patent cases are in a special category in this respect.  In the present case the appellants explicitly sought an order for the costs of the appeal and the trial. 

Accordingly, we do not consider it appropriate to take the exceptional course of an appeal court setting aside an order to enable a party to advance an argument which was open to it, but not advanced on the hearing of the appeal itself.”

10                  The Court went on to refer to reasons of convenience.  This case was followed by another Full Court in Hanave Pty Ltd v LFOT Pty Ltd [1999] FCA 572. 

11                  These two recent decisions by Full Courts clearly spell out the situation.  There are good reasons for the Court to insist on this practice.  It is wasteful for the Court to be reconvened to hear argument on matters which could be put at the hearing, and should be so put, except in unusual situations which are discussed at the hearing itself.  In my opinion, the Court should assume parties have nothing to say about costs, if they have not specifically dealt with that subject. 

12                  It would not be a correct exercise of the discretion of the Court for us to accede to the invitation to vary the costs order made in this case.  Accordingly, I would refuse the application and order that the costs of the application for variation be part of the costs payable to the opposing party, the Australian Competition and Consumer Commission, in relation to the determination of the preliminary question.

Associate:

Dated:              19 July 2001

REASONS FOR JUDGMENT

MOORE J:

13                  I agree with the orders proposed by the learned presiding judge and generally with his reasons.  The only thing I would wish to add is that it appears to me that a necessary implication of the referral to the Full Court of the issues for separate determination was that the question of the costs of the hearing of those issues was also referred.

Associate:

Dated:              19 July 2001

REASONS FOR JUDGMENT

LINDGREN J:

14                  I also agree with the orders proposed and generally with the reasoning of the learned presiding Judge and add the following brief observations.  The application sought substantive relief in paragraphs 1-4 and in paragraph 5 it sought:

“An order that the respondent pay the applicant's costs of and incidental to the application.”

15                  In my view paragraph 5 applied distributively to each head of substantive relief sought.  Accordingly, when, on 23 October 2000, Wilcox J ordered “[p]ursuant to Order 29 rule 2 that the question raised by claims 1, 2 and 3 in the Application be dealt with separately from and before claim 4” and that “[t]he application in respect of claims 1, 2 and 3 be heard on Monday, 18 December 2000”, his Honour’s order carried with it the application for an order for costs in so far as that application related to those three claims for relief.  Accordingly, it would have been possible, if his Honour had dealt with the separate question, for him to have made an order for costs following the hearing of the separate question.

16                  When the Chief Justice directed that the jurisdiction of the Court in the matter be exercised by a Full Court, the “matter” included not only the question raised by claims 1, 2 and 3, but also the application for an order for costs, in so far as that application related to those paragraphs.

17                  Neither party made a submission in relation to costs on the hearing before us of the separate question.  In my opinion, it was incumbent on a party who wished to submit that costs should not follow the event to raise the matter, and it was not incumbent on a party which was content for “the usual practice” to be followed to do so.

Associate:

Dated:              19 July 2001