FEDERAL COURT OF AUSTRALIA

Leonie's Travel Pty Limited v International Air Transport Association (No 3) [2009] FCA 767

COSTS - exercise of discretion to award costs – necessary participation in proceedings - costs follow the event

LEONIE'S TRAVEL PTY LTD (ACN 050 214 152) v INTERNATIONAL AIR TRANSPORT ASSOCIATION (ARBN 002 545 226), QANTAS AIRWAYS LIMITED (ACN 009 661 901), BRITISH AIRWAYS PLC (ARBN 002 747 597), AIR NEW ZEALAND LIMITED (ARBN 000 312 685), SINGAPORE AIRLINES LTD (ARBN 001 056 195), MALAYSIAN AIRLINE SYSTEM BERHAD (ARBN 000 996 903) and CATHAY PACIFIC AIRWAYS LTD (ARBN 000 479 514)

NSD 2449 of 2006

MOORE J

21 JUly 2009

SYDNEY

THE COURT ORDERS THAT:

1.         The applicant pay the first respondent’s costs of the proceedings.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                          These representative proceedings concern a dispute over the alleged failure of the respondents to treat a fuel surcharge as part of the applicable fare for the purpose of calculating the commission to be paid to the applicant and members of the group. The application proceeded to final hearing in relation to the liability of the second respondent and was dismissed as against the second respondent: Leonie’s Travel Pty Ltd v International Air Transport Association (No 2) [2009] FCA 646.

2                          This brief judgment concerns an outstanding issue in relation to the costs of the first respondent, the International Air Transport Association (IATA).  When the proceedings were commenced, the applicant brought them against IATA as well as a number of individual airlines.  Ultimately the applicant accepted that it was unnecessary to maintain the proceedings against IATA and the proceedings against it were discontinued.  IATA seeks its costs but the applicant submits that each party should bear their own costs.

3                          It is unnecessary to rehearse the details of the submissions made in support of these competing positions.  Having commenced the proceedings against IATA unnecessarily, the applicant should, in the ordinary course, pay IATA its costs.  The only point of possible substance telling against such an order, is that some of those costs were said to have been incurred unnecessarily.  That is, IATA participated, it was submitted, in the proceedings at a time when it was apparent the proceedings would not continue against it.  However I do not accept the IATA's participation was, at any relevant point, unnecessary. 

4                          It is true that the solicitors for the applicant informed IATA in late February 2007 and before the discontinuance, that there would be a discontinuance if the other respondents raised no point about the non-joinder of IATA.  Ultimately the applicant secured that commitment from the other respondents.  However the intimation in late February 2007 was obviously conditional.  While there may be cases where, in analogous circumstances, a party continuing to participate in the proceedings ought not get their costs, this is not such a case.  IATA was, in my opinion, entitled to continue to participate in the proceedings having been joined as a party. 

5                          IATA should have its costs.  Accordingly I will order that the applicant pay IATA's costs of the proceedings.

Associate:

Dated:         21 July 2009