FEDERAL COURT OF AUSTRALIA

Armit v Jeminex Limited (No 3) [2012] FCA 1330

THE COURT ORDERS THAT:

1.    The respondent’s application for an order that the costs orders made in its favour on 7 November 2012 and on 19 October 2012 be taxed immediately be refused.

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

REASONS FOR JUDGMENT

1    The respondent has applied for an order that the costs orders made in its favour on 7 November 2012 and on 19 October 2012 be taxed immediately: see rule 40.13 of the Federal Court Rules 2011.

2    The order I made on 19 October 2012 was that the hearing dates commencing on 3 December 2012 be vacated, the applicant to pay the respondent’s costs, if any, thrown away by reason of those hearing dates being vacated. The costs order I made on 7 November 2012 was that the applicant pay the respondent’s costs of and incidental to the relisting of the matter on 5 September 2012, 13 September 2012, 19 October 2012 and 7 November 2012.

3    As directed, the parties filed written submissions, the applicant’s being dated 19 November 2012 and the respondent’s 21 November 2012.

4    At the foreshortened hearing on 7 November 2012, the respondent read an affidavit of Jessica Dorothy Bates sworn on 6 November 2012 quantifying the relevant costs incurred by the respondent to be $15,605.34 including GST. I understand that this total was costs on a solicitor/client basis.

5    At the hearing on 7 November 2012, the respondent also referred to Airservices Australia v Jeppesen Sanderson Inc [2006] FCA 906 (Airservices Australia) as supporting its application.

6    The applicant’s written submissions sought to distinguish Airservices Australia and then submitted that her present impecuniosity was a result of the prior conduct of the respondent. She submitted that it was in the interests of justice that she should be permitted to pursue meritorious claims without being hindered or prevented from doing so by the potential or actual threat of the enforcement of an interlocutory costs order. She submitted that the usual default position was that interlocutory costs are payable at the finalisation of the relevant proceedings and there was no cogent reason as to why that position should not be adopted in respect of the current proceedings. She submitted that the respondent had not established any reasons or facts which justified an order that any interlocutory cost should be taxed forthwith or paid forthwith. She said that a number of the recent adjournments had been necessary because she had not been able to engage the services of new legal representatives, primarily due to the fact that she had not been able to obtain possession of the relevant legal files from her previous lawyers.

7    The respondent submitted in writing that Airservices Australia was not distinguishable; there was no evidence of impecuniosity on the part of the applicant or that the proceedings would be stultified; and that the current state of the proceedings was the fault of the applicant and not the fault of the respondent.

8    In my view it would be an error to proceed by reference to the particular facts of other cases where the judicial discretion has been exercised in favour of an order that costs be taxed forthwith or immediately. Prior decisions in this area are useful only for statements of principle. There are relevant statements of principle in Bailey v Beagle Management Pty Ltd (2001) 105 FCR 136 at [37] and in All Services Australia Pty Ltd v Telstra Corporation Ltd (2000) 171 ALR 330 at [11] per Kiefel J.

9    One relevant factor is that the trial is now set to commence on 2 April 2013. Another is the degree of distinctness between the interlocutory application in respect of which the costs order has been made and the main proceedings. A related factor is whether the interlocutory application was in respect of leave to appeal in an interlocutory matter of practice and procedure. As explained by the Full Court in Bailey v Beagle Management Pty Ltd (above), the policy behind the rule is that, in the ordinary course of litigation, costs awarded in interlocutory proceedings need not be paid until the conclusion of the proceeding when set-offs can be made in the light of the ultimate orders for costs. There is an access to justice aspect in this, the Full Court said. Another factor, in my opinion, is the relatively small amount of costs in issue, bearing in mind that the respondent is a very substantial corporation. Lastly I take into account that the process of taxing costs can be time-consuming for each party. This brings me back to the trial now set to commence on 2 April 2013: the order sought by the respondent would have a tendency, at least, to distract the parties, particularly the applicant, in the preparation for that final hearing. I also note that some of the parties’ submissions seemed to have more to do with whether or not costs orders should be made rather than with the present more limited question which is whether, the costs orders having been made, they should be taxed immediately.

10    In the present circumstances, taking into account the matters to which I have referred in the immediately preceding paragraph, I am not persuaded to make an order that these costs, which I have ordered the applicant to pay, be taxed immediately. It was not suggested that I should distinguish between the costs order I made on 19 October 2012 and the other costs orders.

11    The order I make is that the respondent’s application for an order that the costs orders made in its favour on 7 November 2012 and on 19 October 2012 be taxed immediately be refused.

Associate:

Dated:    28 November 2012