FEDERAL COURT OF AUSTRALIA

Sino Iron Pty Ltd v Secretary, Department of Infrastructure and Transport (No 2) [2014] FCA 755

THE COURT ORDERS THAT:

1.    The appellants pay the second respondent’s costs of the hearing of the interlocutory application to amend the notice of appeal, as agreed or taxed.

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

REASONS FOR JUDGMENT

1.    BACKGROUND

1    By an application dated 8 May 2014, the appellants sought leave to file an amended notice of appeal. The second respondent, Mineralogy Pty Ltd, did not oppose certain of the amendments. I heard argument on 23 May 2014 as to whether leave should be granted with respect to the remaining proposed amendments. These fell into three classes, namely that:

(a)    the appellants had a right to procedural fairness because one of the appellants “was” a port facility operator within the meaning of the Maritime Transport and Offshore Facilities Security Act 2003 (Cth) (the MTOFSA) (the first proposed amendment);

(b)    the appellants were persons whose views were required to be taken into account under s 14(2) of the MTOFSA by reason of their responsibilities under certain agreements (the second proposed amendments); and

(c)    the appellants were persons who had a right to procedural fairness and/or whose views were required to be taken into account by reason of their responsibilities under certain Acts and regulations (the third proposed amendments).

2    On 27 May 2014, I made orders granting leave to the appellants to amend the notice of appeal in terms of the first and second proposed amendments and refused leave to amend in terms of the third for the reasons given in Sino Iron Pty Ltd v Secretary, Department of Infrastructure and Transport [2014] FCA 547 (Sino Iron (No 1)). The appellants did not oppose an order for costs thrown away by reason of the amendments, save for the costs of the hearing of the interlocutory application (as is reflected in my orders my on 27 May 2014). With respect to the latter, the parties agreed that they should have the opportunity to make short written submissions once I had ruled on the amendments.

3    Written submissions were subsequently filed in accordance with directions made by me on the question of costs. Mineralogy also relies upon correspondence between the parties’ legal representatives which predates the hearing of the interlocutory application.

4    For the reasons given below, I consider that the appropriate order in all of the circumstances is that the appellants pay Mineralogy’s costs of the application to be taxed if not agreed.

2.    CONSIDERATION

5    The Court has a wide discretion under s 43 of the Federal Court of Australia Act 1976 (Cth) to award costs including at any stage in a proceeding and to make different awards of costs in relation to different parts of the proceeding. In DSE (Holdings) Pty Ltd v InterTAN Inc (2004) 51 ACSR 555 at 557 [14], Allsop J (as his Honour then was) observed that this power “is a broad and ample power not to be read down otherwise than by judicial principle conformable with the amplitude of the power”.

6    The appellants contended that the appropriate order is that the costs of the interlocutory application be costs on the appeal.

7    Ordinarily, however, the opposing party is entitled to its costs of an application to amend a pleading and the costs thrown away by reason of the amendment, save where it has acted unreasonably. Jagot J explained the rationale for this general principle in Media Ocean Ltd v Optus Mobile Pty Ltd (No 6) [2009] FCA 1319 at [34], observing that:

an applicant seeking leave to amend has an independent obligation to satisfy the Court that leave should be granted, irrespective of the position that the respondent takes. That is, even if the respondent does not oppose an application for leave to amend, such leave will not automatically be granted. The person seeking to amend must come to the Court with sufficient material and submissions to persuade the Court that leave should be granted. Accordingly, the parties would have to attend Court for that purpose anyway.

8    For the reasons set out below, I do not consider that Mineralogy acted unreasonably in opposing the amendments or that the appellants have otherwise demonstrated a sufficient reason as to why Mineralogy should bear the costs of the hearing of the appellants’ application, as well as the other costs thrown away.

9    First, the necessity to apply to amend the notice of appeal arose as a consequence of the appellants’ own failure to plead those grounds of appeal in the first instance. No evidence was led as to why the grounds had not been included in the notice of appeal as originally filed. Nor do I consider that the fact that new counsel for the appellants had looked at the matter with ‘fresh eyes’ is relevant to the question of whether Mineralogy should be deprived of its costs of the application. I am reinforced in my view as to the weight to be given to this consideration by the obligations upon the parties and their legal representatives under s 37M of the Federal Court of Australia Act (Cth) to act in a way that is consistent with the quick, inexpensive and efficient resolution of disputes.

10    Secondly, it is true, as the appellants submitted, that the parties each had a measure of success and failure with respect to the amendment application. However, that submission fails to take account of the general principle to which I have referred. Nor does it do justice to the reasons why the application was allowed in part. In particular, I found that, contrary to the appellants’ submission, the first proposed amendment raised a new issue not run at trial (Sino Iron (No 1) at [18]). Furthermore and related to this, I considered the question of whether the application should be allowed was finely balanced, notwithstanding that ultimately I found that the interests of justice would best be served by allowing the amendment (Sino Iron (No 1) at [21]).

11    Thirdly, fairly, it was only when the appellants’ Senior Counsel clarified the scope of the arguments raised by the proposed first amendment that it became apparent that Mineralogy’s submission that it would be prejudiced by the new ground because it may have run its case differently at trial, was based on a misunderstanding (Sino Iron (No 1) at [19]). In any event, the mere absence of specific prejudice to the other party is not in itself determinative of whether it is in the interests of justice to permit the amendment (Sino Iron (No 1) at [12]).

12    In the fourth place, Mineralogy’s solicitors advised the appellants’ solicitors by letter dated 20 May 2014 of the reasons why they opposed the third proposed amendments. The basis for its opposition to those amendments was upheld by me in refusing leave to make those amendments.

13    Finally, Mineralogy had agreed in advance to certain of the amendments thereby limiting the issues about which there was dispute.

14    For each of these reasons, I consider that Mineralogy should be awarded its costs on the hearing of the application to amend the notice of appeal.

Associate:

Dated:    21 July 2014