MLC Limited v Crickitt (No 2) [2017] FCA 937

File number:

NSD 1114 of 2017



Date of judgment:

15 August 2017


COSTS –application under s 215 of the Life Insurance Act 1995 (Cth) – appropriate order for costs


Life Insurance Act 1995 (Cth), s 215

Federal Court Rules 2011 (Cth), r 8.05

Cases cited:

MLC Limited v Crickitt [2017] FCA 898

Westpac Life Insurance Services Limited v Mahony [2016] FCA 1071

Date of hearing:

Determined on the papers


New South Wales


General Division

National Practice Area:

Commercial and Corporations


Commercial Contracts, Banking, Finance and Insurance

Insurance List



Number of paragraphs:


Counsel for the Applicant:

Ms BK Nolan

Solicitor for the Applicant:

Norton Rose Fulbright

Counsel for the Respondent:

Ms A Hawkins

Solicitor for the Respondent:

Streeton Lawyers

Counsel for the Substitute Executor:

Ms M Pringle

Solicitor for the Substitute Executor:

Maurice Blackburn Lawyers


NSD 1114 of 2017










15 AUGUST 2017


1.    The parties have seven days to file written submissions of no more than two pages as to why the proposed orders should not be made.

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



1    On 3 August 2017, I made orders at the first case management hearing disposing substantially of the matter. I reserved the question of costs to be dealt with on the papers: MLC Limited v Crickitt [2017] FCA 898. The background to the proceedings can be gleaned from my earlier judgment.

2    I reserved the question of costs because of some concerns I had at the case management hearing at the amount of costs being sought by the applicant in relation to the application. The applicant insurer seeks an order for its costs of and incidental to the proceeding calculated on an indemnity basis to be paid from the death benefit moneys; that is, from the policy of insurance.

3    I acknowledge at the outset that under the Federal Court Rules 2011 (Cth) (Pt 8, r 8.05) an applicant is obliged to commence proceedings by an originating application accompanied by either an affidavit or a statement of claim. The current practice notes, in particular, the Commercial and Corporations Practice Note (C&C-1), and the Central Practice Note (CPN-1), anticipate the possible commencement of proceedings by an originating application accompanied by a Concise Statement. The Rules of Court, as yet, have not caught up with the practice contemplated by the Practice Notes. That will occur shortly.

4    One of the underlying reasons for the commencement of a matter by a Concise Statement is the limitation of costs expended before the commencement of proceedings. The judges of the Court recognised that significant amounts of costs can be expended by preparing a statement of claim or preparing a detailed affidavit prior to the proceeding that can thereafter direct or deflect a case in a way that leads to the unnecessary expenditure of costs.

5    Here, the application of s 215 of the Life Insurance Act 1995 (Cth) was tolerably straightforward. The death benefit is payable to the person who is the policy owner at the death of the life insured. The policy owners were the trustees of a superannuation fund who were Mrs Crickitt (the deceased) and Mr Crickitt. Thus in effect, one beneficiary had been convicted of the murder of his co-beneficiary under the policy. By the forfeiture rule the beneficiary will not (depending upon the success of any appeal, and in what respects) in all likelihood be entitled to the proceeds of the policy.

6    The claim that the insurer can thereby take advantage of s 215 of the Life Insurance Act to absolve itself practically from further responsibility is not doctrinally or factually difficult. In these circumstances, however, costs of over $18,000 have been incurred by the applicant in the preparation of the application.

7    I should say that the standard of work produced on behalf of the applicant by the solicitors and counsel is not the subject of criticism in the slightest.

8    One aspect of these matters under s 215 that I have previously drawn to the attention of the profession is the possibility of coming to Court at the first case management hearing on such an application as this with a short summary affidavit and seeking the views of any other parties and the docket judge as to the necessary level of detail and consequent expense that is required in the matter: Westpac Life Insurance Services Limited v Mahony [2016] FCA 1071 at [31].

9    I am not being personally critical of the solicitors and the exigencies and expense of modern-day practice are ever present considerations. Nevertheless, I have had placed before me all the Memoranda of Costs in the matter. I would point out the following matters.

10    First, a time costing approach has been made to cost this matter. The time-costing at the various charge-out rates has been apparently undertaken for all work on the file, including any necessary legal research. The time-costing included various considerations by the partner concerned for 0.20 hours (12 minutes) for “considering status and formulating strategy”.

11    I should add that counsel also assessed the likely fees based on hourly charging.

12    One aspect of the question as to the entitlement for the costs on an indemnity basis is that an application under s 215 of the Life Insurance Act can be seen as an aspect of doing business as a life insurer. Nevertheless, historically, for the reasons expressed in Westpac Life v Mahony at [33] the Court has been prepared to make an appropriate order for costs.

13    The consideration of how much should be allowed to be charged upon the policy for what is a straightforward application in relation to a modest policy in circumstances where the ultimate beneficiary of the policy, whether the original named beneficiary or others, may well be themselves of modest means is not a straightforward question.

14    Recognising the present form of r 8.05, the need to place an affidavit before the Court and the quality of the work undertaken and performed by solicitors and counsel, but also recognising the tolerably straightforward nature of the application to the point of a case management hearing, I am prepared to make an order that the applicant have its costs of and incidental to this application in the sum of $13,000.00, plus the costs of any Court fees imposed on the applicant.

15    As I indicated to the parties, I will hear the parties on the form of this order. I will give the parties seven days to provide me with a two-page submission as to why I should vary the order that I prepare.

I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Allsop.


Dated:    15 August 2017