FEDERAL COURT OF AUSTRALIA

Australian Competition & Consumer Commission v Davis & Others
[2003] FCA 1458

ACCC v Woolworths Limited (No. 2) [2002] FCA 1046 cited

AUSTRALIAN COMPETITION & CONSUMER COMMISSION v WAYNE HINA DAVIS, ANTHONY TERENCE MATTHEWS, EDWARD DAVIS

W111 OF 2001

LEE J

11 DECEMBER 2003

PERTH

THE COURT ORDERS THAT:

The sixth respondent pay so much of the applicant’s costs as relate to the sixth respondent, confined to those issues on which the applicant sought and obtained orders against the sixth respondent, and otherwise there be no order as to costs. 

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

REASONS FOR JUDGMENT

LEE J:

1                     On 7 November 2003 I delivered reasons for determining that declarations and orders should be made against the sixth, seventh and eighth respondents (“the respondents”).  In respect of the question of costs it was ordered that unless the parties made submissions thereon within seven days the sixth respondent was to pay so much of the applicant’s (ACCC’s) costs as related to that respondent and otherwise there be no order as to costs.

2                     On 14 November 2003 solicitors for the respondents filed submissions seeking an order that the applicant pay the seventh and eighth respondents’ costs as from 21 July 2003 and that otherwise there be no order as to costs.

3                     The ACCC did not file any submissions within the time allowed.  Some time later, on 3 December 2003, it purported to file submissions propounding an order that the respondents pay so much of the ACCC’s costs as related to them.  The respondents objected to the submissions submitted by the ACCC being considered by the Court.  I accept the force of that objection and propose to treat the failure of the ACCC to file submissions within the time allowed as a considered decision to accept the order for costs proposed in my earlier reasons.

4                     With regard to the sixth respondent the principal grounds relied upon by the respondent to oppose the proposed order were that on the day of hearing, 21 July 2003, the sixth respondent had offered to compromise the matter on terms no less favourable to the applicant than the orders made by the Court on 7 November 2003 and, further, that pursuant to the orders for costs consented to by the first to fifth respondents the ACCC will recover the costs it incurred in the matter. 

5                     I am not satisfied that the offer made by the sixth respondent on 21 July 2003 was comparable to the result obtained by the ACCC after trial.  The sixth respondent was not prepared to admit liability and offered an undertaking “inter partes” in respect of its future conduct in return for dismissal of the proceeding without any order for costs.  The proposed compromise fell well short of the content of the orders obtained by the ACCC after trial.  (See:  ACCC v Woolworths Limited (No. 2) [2002] FCA 1046 at [27]‑[32]).  It is to be noted however that the ACCC pleaded a broad case against the sixth respondent which was not reduced in scope until shortly before trial on 21 July 2003.  Fairness requires that the sixth respondent not be saddled with costs incurred by the ACCC in respect of issues beyond the confined case put by the ACCC at trial.  The proposed order for costs should be amended to make clear that it is so restricted in its operation. 

6                     With regard to the seventh and eighth respondents the offer to compromise on 21 July 2003 in the terms set out above was not equivalent to the orders obtained after trial and no entitlement to an order for costs from the date of offer has been demonstrated.

7                     The ACCC established less than the case originally pleaded against those respondents, and also less than the case as confined by the submissions made by the ACCC at trial.  A determination that there be no order for costs as between the ACCC and the seventh and eighth respondents takes account of those circumstances.

8                     It will be ordered that the sixth respondent pay so much of the ACCC’s costs as relate to the sixth respondent confined to those issues on which the ACCC sought and obtained orders on the hearing of the matter and otherwise there be no order as to costs. 

Associate:

Dated:              11 December 2003