FEDERAL COURT OF AUSTRALIA

Binetter v Deputy Commissioner of Taxation (No 4) [2012] FCA 776

THE COURT ORDERS THAT:

1.    The applicant pay the respondent’s costs of the applicant’s interlocutory application filed on 16 March 2012.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

Introduction

1    These reasons should be read together with my reasons for judgment in the substantive proceedings, dismissing with costs the further amended originating application for judicial review: Binetter v Deputy Commissioner of Taxation (No 3) [2012] FCA 704.

2    The unsuccessful applicant for final relief sought an order that the respondent pay the applicant’s costs of the interlocutory application before Rares J. To preserve the status quo pending final hearing, his Honour ordered that the respondent extend the time for compliance with the notice to the applicant dated 24 February 2012, subject to further order, from 23 March 2012 up to and including the fourteenth day after the making of final orders in the proceedings: Binetter v Deputy Commissioner of Taxation [2012] FCA 377. On that occasion, Rares J made no order for costs.

3    The parties agreed that I should determine the present application and they were content for the matter to be determined on the papers.

4    The applicant and the respondent each filed short written submissions in support of their respective positions on the applicant’s application for costs of the interlocutory application.

5    I note rule 40.04 of the Federal Court Rules 2011. It was common ground that the Court had a discretion to order that the respondent pay the applicant’s costs of the applicant’s interlocutory application either in whole or in part or that the applicant pay the respondent’s costs of the applicant’s interlocutory application in whole or in part.

Submissions

6    The applicant submitted that this was an appropriate case for the respondent to pay the applicant’s costs of the interlocutory application. The applicant relied on the following grounds: the interlocutory proceedings related to matters distinct from the substantive issues in the proceedings; the interlocutory application was a discrete, separately identifiable aspect of the proceeding; the costs had been incurred as a result of unreasonable conduct by the party against whom the order should be made; and in proceedings under the Administrative Decisions (Judicial Review) Act 1977 (Cth), the court will usually award costs against a decision maker who changes his or her mind in favour of an applicant before a trial, except where the change of mind is brought about by a change in external circumstances.

7    The respondent disputed the applicability of these grounds and submitted that the applicant should pay the respondent’s costs of the applicant’s interlocutory application because the applicant had failed at trial.

Consideration

8    I do not accept the applicant’s submission that the interlocutory proceedings related to matters distinct from the substantive issues in the proceedings. The issues in the interlocutory proceedings as to the validity of the notice were grounds which I rejected on the final hearing. While it is correct to say that, up to a certain point, the Commissioner contended that he had no power to extend time for compliance with the notice, that question in itself was not distinct from, but was consequential upon, the applicant establishing a prima facie case and the balance of convenience in her favour.

9    Similarly, I do not accept the applicant’s submission that the interlocutory application was a discrete, separately identifiable aspect of the proceeding.

10    Next, it follows that I do not accept the applicant’s submission that the costs of the interlocutory application were incurred as a result of unreasonable conduct by the party against whom the order should be made. Although the Commissioner had, in correspondence, contended that he had no power to vary the time for compliance I do not conclude on that basis that the respondent acted unreasonably in opposing the application for interlocutory relief. That issue was, in my view, one going to the mechanics of extending the time for compliance once the Court had determined that there should be a grant of interlocutory relief.

11    I do not regard it as presently significant that a statement of reasons was provided after the application for interlocutory relief was brought. No doubt that fact was relevant, as Rares J found, to the question of whether there had been a delay on the part of the applicant warranting the refusal of interlocutory relief to which she might otherwise have been entitled, but I do not accept that it is of significance to the present question. For completeness I note that the notice in issue was dated 24 February 2012 and the reasons were provided late on Friday 16 March 2012 after the interlocutory application had been fixed for hearing on 19 March 2012. I also note that Rares J said that the applicant did not seek to rely on anything contained in those reasons on the interlocutory application.

12    In the present case I regard the applicant’s application for interlocutory relief as, relevantly, part of the ultimately unsuccessful application for judicial review of the respondent’s decision to issue the notice.

Orders

13    For these reasons I refuse the applicant’s application and order that the applicant pay the respondent’s costs of the applicant’s interlocutory application, including the costs of the present application.

Associate:

Dated:    20 July 2012