FEDERAL COURT OF AUSTRALIA

Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2014] FCA 1441

THE COURT ORDERS THAT:

1.    The time within which the fourth respondent may file and serve the notice of objection dated 15 October 2014 be extended nunc pro tunc to 16 October 2014.

2.    The time within which the fourth respondent may file and serve the notice of objection dated 17 October 2014 be extended nunc pro tunc to 20 October 2014.

3.    The fourth respondent is to pay the applicant's costs of and incidental to the fourth respondent's interlocutory application dated 23 October 2014, fixed in the sum of $12,500, within 7 days of the date hereof.

4.    In default of the payment of the costs within the period referred to in order 3, the notices of objection dated 15 October 2014 and 17 October 2014 respectively be disallowed and the taxation of the applicant's costs proceed as if the notices of objection had not been lodged.

5.    The time within which the applicant is to file its responses to the notices of objection dated 15 October 2014 and 17 October 2014 respectively be referred to the District Registrar for further consideration.

6.    Liberty to apply.

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

REASONS FOR JUDGMENT

1    On 16 October 2014, District Registrar Scott advised the parties to a taxation of costs, which was listed for hearing on 27, 28, and 29 October 2014, that she would not accept any notices of objection to a Bill of Costs filed and served by the costs respondent after 13 October 2014. The costs applicant was given until 23 October 2014 to file responses to notices of objection filed on or before 13 October 2014. The costs respondent purported to file and serve notices of objection dated 15 October 2014 and 17 October 2014 respectively. Under the District Registrar’s decision, these two notices of objection would not be effective on the taxation (Federal Court Rules 2011 (Cth) (“the 2011 Rules”) r 40.27).

2    On 23 October 2014, the costs respondent brought an application to review the District Registrar’s decision (Federal Court of Australia Act 1976 (Cth) s 35A(5); r 3.11 of the 2011 Rules). I heard the application on 24 October 2014 and, at the conclusion of the submissions, I made the following orders:

1.    The time within which the fourth respondent may file and serve the notice of objection dated 15 October 2014 be extended nunc pro tunc to 16 October 2014.

2.    The time within which the fourth respondent may file and serve the notice of objection dated 17 October 2014 be extended nunc pro tunc to 20 October 2014.

3.    The fourth respondent is to pay the applicant's costs of and incidental to the fourth respondent's interlocutory application dated 23 October 2014, fixed in the sum of $12,500, within 7 days of the date hereof.

4.    In default of the payment of the costs within the period referred to in order 3, the notices of objection dated 15 October 2014 and 17 October 2014 respectively be disallowed and the taxation of the applicant's costs proceed as if the notices of objection had not been lodged.

5.    The time within which the applicant is to file its responses to the notices of objection dated 15 October 2014 and 17 October 2014 respectively be referred to the District Registrar for further consideration.

6.    Liberty to apply.

3    These are my reasons for making those orders.

4    The background to this review of the District Registrar’s decision is as follows.

5    The applicant, Bob Jane Corporation Pty Ltd, brought proceedings against a number of respondents, including the fourth respondent, Mr Robert Frederick Jane, for injunctive, declaratory, and other relief. The basis of the applicant’s claims were infringements of its trade marks, passing off, alleged misleading and deceptive conduct under s 18(1) of the Australian Consumer Law (Competition and Consumer Act 2010 (Cth) Schedule 2), and alleged misrepresentations in relation to the supply or possible supply of goods and services under s 29(1)(g) of the Australian Consumer Law. The respondents did not appear at the hearing. I granted the relief sought by the applicant and made various orders: Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2013] FCA 1255. I also made an order that the applicant’s costs from 2 February 2012 be paid by the respondents on an indemnity basis.

6    The respondents did not comply with the orders and I made findings of contempt and imposed penalties on 19 June 2014: Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2013] FCA 637.

7    On 3 February 2014, the applicant filed a Bill of Costs and, on 8 April 2014, a Deputy District Registrar made an estimate of the applicant’s costs under r 40.20 of the 2011 Rules. On 29 April 2014, the fourth respondent lodged a notice of objection to the estimate of costs pursuant to r 40.21 of the 2011 Rules.

8    It became clear that the parties were in dispute about how the applicant had prepared its Bill of Costs, and the District Registrar decided to deal with the point as a preliminary issue. I now quote from my reasons in Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2014] FCA 1066 at [6]:

On or about 28 July 2014, the District Registrar advised the parties of her decision on what she described as the preliminary issue. The District Registrar provided reasons for that decision in writing on 29 July 2014. She said that the fourth respondent had raised an issue for preliminary determination and that issue was whether the applicant is required by r 40.29 of the 2011 Rules to prepare its bill of costs in accordance with the costs schedule contained in the Rules of Court. The District Registrar answered that question in the negative. She referred to the definition of “costs on an indemnity basis” in the 2011 Rules. She said that the definition of indemnity costs is clear. She described the purpose of r 40.29 as “temporal only”, and that the effect of the rule was not to “impose” the costs schedule on a claim for indemnity costs. The District Registrar said that the taxation would “proceed on the basis of the bill of costs being assessed in accordance with the definition of costs on an indemnity basis and the Applicant will not be required to redraw the bill of costs to refer to the scale in the costs schedule”.

9    On 14 August 2014, the fourth respondent brought an application to review the District Registrar’s decision made on 28 July 2014.

10    The fourth respondent’s application came on for hearing before me on 17 September 2014. By that time, a date had been fixed for the hearing of the taxation of costs of 27, 28, and 29 October 2014. When the District Registrar advised the parties of her decision made on 28 July 2014, she advised the parties that the costs respondent must file and serve its or his notice of objection in accordance with r 40.25 of the 2011 Rules by 29 September 2014, and the costs applicant must file and serve its response in accordance with r 40.26 of the 2011 Rules by 20 October 2014. At the hearing before me on 17 September 2014, I extended the time for the fourth respondent to file and serve his notice of objection to 6 October 2014. At that stage, of the respondents, only the fourth respondent was playing an active role in the taxation of costs.

11    On 3 October 2014, I delivered my decision on the fourth respondent’s application to review the District Registrar’s decision. I made an order dismissing the application: Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2014] FCA 1066.

12    On 1 October 2014, the fourth respondent served his objections to those parts of the applicant’s Bill which claimed costs assessed on a party/party basis.

13    On 10 October 2014, the fourth respondent served by email an initial tranche of his notice of objection to those parts of the applicant’s Bill which claimed costs assessed on an indemnity basis and, on 13 October 2014, the fourth respondent served by email a second tranche of his notice of objection. By letter attached to that email, the fourth respondent sought an extension of time within which to file further notices of objection.

14    On 15 October 2014, the fourth respondent purported to serve by email a third tranche of his notice of objection.

15    On 16 October 2014, having received a response to the fourth respondent’s request from the applicant on 14 October 2014, the District Registrar indicated that she would not accept objections to the Bill filed after 13 October 2014. In view of her decision to accept the late notices of objection dated 10 October 2014 and 13 October 2014 respectively, the District Registrar extended the time for the applicant’s response to 23 October 2014.

16    On 17 October 2014, the fourth respondent purported to serve a fourth tranche of his notice of objection.

17    The District Registrar considered that the fourth respondent had had sufficient time to file his notices of objection. The taxation of costs was due to commence on 27 October 2014 and the District Registrar had in mind in making her decision that the fourth respondent had referred at the hearing before me on 17 September 2014 to a period of 10 days after I handed down my decision on the preliminary issue (which I delivered on 3 October 2014) as being sufficient time within which to file his notices of objection, and that I had indicated to the parties that, if required, they could seek any further extensions of time when I delivered judgment on that application. She perhaps also had in mind the 14 day period prescribed in r 40.25 of the 2011 Rules.

18    On the hearing of the application for review, the applicant relied on an affidavit of Ms Catherine Mary Dealehr, who is a costs consultant. The applicant relied on an affidavit of its solicitor, Mr Richard Hoad.

19    The hearing before me was a hearing de novo: Re Kwiatek and Kwiatek; Ex parte Big J Ltd v Pattison (1989) 21 FCR 374.

20    I was told that, if the fourth respondent could not rely on the third and fourth tranches of his notices of objection, then the amount in the applicant’s Bill which would stand unchallenged was approximately $166,000. That was the prejudice to the fourth respondent if the time for filing notices of objection was not extended. The fourth respondent’s explanation for the delay was not entirely satisfactory. It seems that Ms Dealehr was not engaged until sometime between 28 August 2014 and 1 October 2014, and that she did not commence examining the costs to be assessed on an indemnity basis until 8 October 2014.

21    The prejudice to the applicant in extending the time was the risk that the taxation of costs could not be completed on 27, 28, and 29 October 2014. If that occurred, as seemed likely, there would be further delay for the applicant in finalising the taxation and securing a certificate of taxation. The possibility of the applicant securing separate or interim certificates of taxation does not wholly overcome this prejudice. I also took into account the fact that the fourth respondent, in an affidavit he swore on 4 March 2014, said that his financial position was such that he was at risk of being declared bankrupt.

22    By a narrow margin, I considered that the prejudice to the fourth respondent, if I did not extend the time for filing and serving notices of objection, outweighed the prejudice to the applicant if I did. The fourth respondent should pay the costs of the application to review and there was no reason the applicant should not be paid those costs immediately. I fixed those costs and ordered that they be paid within seven days.

23    It was for these reasons that I made the orders I did on 24 October 2014.

Associate:

Dated:    9 January 2015