FEDERAL COURT OF AUSTRALIA

Telstra Corporation Limited v Mahon [2004] FCA 1483

COSTS – where the successful respondent filed a notice of contention – where the notice of contention raised difficult legal and factual issues – whether the court should depart from the normal rule that costs follow the event – applicant ordered to pay a percentage of the respondent’s costs

Federal Court of Australia Act 1976 (Cth) s 43

Hughes v Western Australian Cricket Association Inc (1986) ATPR 40 -748 

Inn Leisure Industries Pty Ltd v DF McCloy Pty Ltd (No 2) (1991) 28 FCR 172

Telstra Corporation Limited v Mahon [2004] FCA 1404

TELSTRA CORPORATION LIMITED (ACN 051 775 556) v CHRISTOPHER JOHN MAHON

NSD556 OF 2004

BENNETT J

18 NOVEMBER 2004

SYDNEY

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

THE COURT ORDERS THAT:

            The applicant pay 50% of the respondent’s costs.

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

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

REASONS FOR JUDGMENT

1                     In this matter, I dismissed an appeal from the Administrative Appeals Tribunal in respect of a determination regarding the liability of the applicant to pay compensation to the respondent (Telstra Corporation Limited v Mahon [2004] FCA 1404).  I concluded that the applicant (‘Telstra’) did not demonstrate an error of law on the part of the Tribunal.

2                     The respondent had filed a notice of contention, which was in the nature of a cross-appeal.  The respondent did not succeed in establishing any of the grounds of the notice of contention.

3                     Telstra accepted that it must pay a proportion of the costs of the appeal but submitted that the notice of contention raised a number of ‘difficult legal, and contentious factual, issues’ which were argued in full, in both written and oral submissions.  Telstra submitted that, in these circumstances, the appropriate costs order would be in favour of the respondent on the appeal and in favour of the applicant on the notice of contention. This is achieved, Telstra submitted, by an order that the applicant pay 50% of the respondent’s costs.

4                     The respondent submitted that he has been successful and that costs should follow the event in the absence of any action to occasion unnecessary litigation or expense.

5                     Section 43 of the Federal Court of Australia Act 1976 (Cth) provides the Court with the jurisdiction to award costs.  The Court has a wide discretion to award costs (Hughes v Western Australian Cricket Association Inc (1986) ATPR 40 -748).  While costs normally follow the event, the costs should also reflect the degree of success attained.  Thus a party may not be entitled to all of its costs or may be ordered to pay costs in respect of aspects of the case in which it was unsuccessful or which prolonged the proceedings: Inn Leisure Industries Pty Ltd v DF McCloy Pty Ltd (No 2) (1991) 28 FCR 172.

6                     I accept Telstra’s submissions as to the notice of contention.  The respondent was not successful in respect of the matters there raised.  The order for costs should reflect that outcome.  The applicant submitted that, rather than make an order for costs in respect of each of the appeal and the notice of contention, an order that reflects the overall success is appropriate.  I propose to take that course.  I order the applicant to pay 50% of the respondent’s costs.

Associate:

Dated:              18 November 2004