FEDERAL COURT OF AUSTRALIA

Lababidi v Secretary, Department of Employment and Workplace Relations [2007] FCA 1568

Ruddock v Vardalis (No 2) (2001) 115 FCR 229 cited

Akbar v Minister for Immigration and Multicultural Affairs [2002] FCA 209 cited

MOHAMMED MOHSEN LABABIDI AND LINA ZEINO LABABIDI v SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS

VID 1249 OF 2006

KENNY J

12 OCTOBER 2007

MELBOURNE

THE COURT ORDERS THAT:

1.                  The appellants pay the respondent’s costs occasioned by the appeal.

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

REASONS FOR JUDGMENT

1                     In November last year, Mohammed and Lina Lababidi appealed from a judgment of the Federal Magistrates Court dismissing their appeal in respect of a decision of the Administrative Appeals Tribunal (‘the Tribunal’).  They have now filed a notice of discontinuance, although they maintain they ought not to be liable for the respondent’s costs to date.  The respondent disputes this.

2                     The Tribunal affirmed decisions by the Social Security Appeals Tribunal regarding the ineligibility of Mr and Mrs Lababidi to receive a number of social security payments.    The Tribunal decided that each of Mr and Mrs Lababidi was ineligible for the relevant benefits. Mrs Lababidi was a homeowner for the purposes of the social security legislation and thus not eligible for rent assistance.  Mr and Mrs Lababidi’s assets exceeded the combined asset limit for homeowners and thus they did not qualify for newstart or parenting payments. 

3                     Pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (‘AAT Act’), Mr and Mrs Lababidi appealed to this Court.  The matter was referred to the Federal Magistrates Court.  A Federal Magistrate dismissed the appeal, holding that the appellants had not raised any question of law (which was a condition for jurisdiction) and that, in any case, there appeared to be no legal error in the Tribunal’s decision.

4                     The grounds of appeal in this Court were not entirely clear.  The documents that the appellants have filed contained various complaints about the merits of the Tribunal’s findings of fact.  Similar complaints were apparently made in the Federal Magistrates Court and, as the Federal Magistrate noted, did not support an appeal on a “question of law” under s 44 of the AAT Act.

5                     It is unnecessary here to consider the law with respect to costs at any length.  The power to make an order for costs derives from s 43 of the Federal Court of Australia Act 1976 (Cth).  The nature of this power has been discussed on numerous occasions: see, for example, Ruddock v Vardalis (No 2) (2001) 115 FCR 229.  Order 52 r 19(3) of the Federal Court Rules applies in the present circumstances.  Order 52 r 19 states:

(1)       An appellant may file and serve a notice of discontinuance:

(a)        at any time before the hearing of the appeal, without the leave of the Court; or

(b)        at the hearing, or after the hearing and before judgment is pronounced or made, with the leave of the Court.

(1A)     If a notice of discontinuance is filed and served under subrule (1), the appeal is abandoned.

(2)       …

(3)       A party filing a notice of discontinuance under subrule (1) shall be liable to pay the costs of the other party or parties occasioned by the appeal.

(4)       A party whose costs are payable under subrule (3) may tax the costs and if the taxed costs are not paid within 14 days after service of the certificate of taxation may enter judgment for the taxed costs.

6                     As indicated earlier, Mr and Mrs Lababidi have filed a notice of discontinuance.  If the notice is effective, then Mr and Mrs Lababidi are liable to pay the respondent’s costs pursuant to O 52 r 19(3).   They seek to be relieved from this liability on the basis of financial incapacity.  There are, however, numerous decisions in this Court to the effect that financial hardship or claimed incapacity does not justify an order relieving a party of a costs burden that would ordinarily be imposed.  In Akbar v Minister for Immigration and Multicultural Affairs [2002] FCA 209, for example, the appellant filed a notice of discontinuance and subsequently asked to be relieved of the obligation to pay costs on the basis that he was impecunious.  The Court refused his request stating that his inability to pay “may be of very great importance to any decision to recover costs by the respondent, but it does not have any effect in altering the operation of O 52 r 19(3)”.  There is no basis shown for depriving the respondent of the benefit of O 52 r 19(3).  There is also no basis upon which this Court might vary the order for costs that has been made by the Federal Magistrate in respect of the proceeding in the Federal Magistrates Court.

Associate:

Dated:         12 October 2007