Federal Court of Australia

Dyer v Chrysanthou (No 3) (Costs) [2021] FCA 642

ORDERS

THE COURT ORDERS THAT:

1.    The first and second respondents pay the applicant’s costs of the proceedings

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

REASONS FOR JUDGMENT

THAWLEY J:

1    These reasons address the question of costs consequent upon the success of the applicant in Dyer v Chrysanthou (No 2) (Injunction) [2021] FCA 641. Familiarity with those reasons is assumed.

2    The first respondent, Ms Chrysanthou SC, contended that she should not be ordered to pay costs, submitting that:

(1)    once Ms Dyer commenced these proceedings, Ms Chrysanthou took a neutral position as an officer of the Court submitting to the orders as the Court deemed fit;

(2)    Ms Chrysanthou took no active part in the conduct of the proceeding. She was required to file a concise response and an affidavit which set out relevant background matters and her recollection of the conference held on 20 November 2020, and she filed both documents;

(3)    No substantive submissions were filed or made on behalf of Ms Chrysanthou. Her opening submissions reiterated that she would not advance any position on the dispute, and no closing submissions were made.

3    As to the first two of these submissions, the following observations should be made:

(1)    Ms Chrysanthou submitted to whatever order the Court deemed fit. Her submission that she took a “neutral position” should be qualified. Before proceedings were commenced, Ms Chrysanthou, through her solicitors, adopted an adversarial approach, including threatening an application for security for costs in the amount of $150,000 should proceedings be commenced. This is not intended as a criticism. But it is a part of the context in which the question of costs must be determined. The “neutral position” was first indicated at the first case management hearing. Further, it should be noted that, in cross-examination, Ms Chrysanthou accepted that she had assisted Mr Porter in these proceedings. Mr Porter contended, in part relying on Ms Chrysanthou’s evidence, that Ms Chrysanthou should not be restrained from acting for him.

(2)    Ms Chrysanthou was not “required” to file a concise statement or an affidavit. Provision was made for her to do either of those things if she so chose.

4    The commencement of these proceedings was necessary because Ms Chrysanthou had at all times refused to accept either that: (a) there was a relevant risk of misuse of confidential information; or (b) irrespective of whether or not there was a risk of misuse of confidential information, it was in the interests of the administration of justice that she cease acting for Mr Porter.

5    Ms Chrysanthou’s position was shown to be wrong in both respects. Ms Dyer was wholly successful. The ordinary rule is that costs follow the event: Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at [11] (Black CJ and French J); Gray v Richards (No 2) (2014) 315 ALR 1 at [2]. It has been said that there is often an “expectation” that a party will not be subject to costs from the date of filing a submitting notice – see, for example: Lo v Australian Community Pharmacy Authority [2013] FCA 639 at [80]. The fact of the filing of such a notice is undoubtedly relevant to the exercise of the broad costs discretion in s 43 of the Federal Court of Australia Act 1976 (Cth). However, the filing of such a notice, or the statement to the Court that a party will adopt such a position, does not create a prima facie position that no costs will be awarded from the date of the notice or statement. Rather, the question must be determined on the basis of an appraisal of all of the facts, in particular the context in which the submitting notice was filed (or the relevant party indicated its position in that respect) – see, albeit in relation to a materially different statutory provision and rules of court: Kisimul Holdings Pty Ltd v Clear Position Pty Ltd (No 2) (2014) 86 NSWLR 645 at [14]. The context in the present case has been referred to earlier. In the circumstances of this case, my view is that Ms Chrysanthou should not be relieved of an order that she pay the costs of the successful party.

6    The second respondent, Mr Porter, accepted that he should pay costs, but said the order should be for 70% of the costs in light of “the late service” of Mr Hooke’s affidavit in reply. It was submitted that Mr Hooke’s affidavit was: (a) not in reply; and (b) analogous to an amendment in that it gave evidence of what was said at the conference of 20 November 2020 rather than simply identifying the topics which had been discussed, marking a change in the way the case was being run. This change in the applicant’s case was said to have added to the length of the hearing extending it from 3 days to 4 days.

7    As to these submissions:

(1)    First, Mr Hooke’s affidavit was not served late.

(2)    Secondly, it is true that Mr Hooke’s affidavit was the first occasion on which the applicant put forward evidence of what was actually said at the conference on 20 November 2020 rather than identifying the topics which had been discussed. It would have been possible, and preferable, for Mr Hooke to have identified in his evidence in chief precisely what information had been given which was confidential. However, there was at least a partial explanation for some of the evidence first being given in reply – see: Dyer v Chrysanthou [2021] FCA 578 at [4]. In any event though, I do not accept that the evidence ultimately added an additional day to the length of the hearing. Even if it had added to the length of the hearing, in a case of this kind, litigated under pressing time constraints, that would not of itself be sufficient to reduce the applicant’s costs by 30%.

(3)    Thirdly, the service of the affidavit does not bear an analogy to an amendment of the pleadings. Mr Hooke’s second affidavit added to the evidence. The case remained the one which had been identified in the concise statement. The service of the evidence did not require any alteration or amendment to the concise statement. I note in this respect that a concise statement is different to what is traditionally understood as a pleading – see: Australian Securities and Investment Commission v Westpac Securities Administration Ltd (2019) 272 FCR 170 at [185] (Allsop CJ). In Dyer v Chrysanthou [2021] FCA 578, I rejected an objection to reliance on Mr Hooke’s second affidavit and an application for it to be excluded under s 135 of the Evidence Act 1995 (Cth), stating at [10]:

Finally, I do not accept that the concise statement needs to be amended. The issues in the case are clear from the terms of the concise statements, the evidence which has been filed and the parties’ written submissions. The evidence of Mr Hooke contained in his second affidavit gives an account of what was said previously identified in the evidence by reference to topics. The parties sufficiently understand the issues dividing them.

8    As noted, the ordinary rule is that costs follow the event. In my view, there is insufficient reason to disturb the ordinary rule by reducing the amount of costs awarded.

9    For these reasons, the Court orders that the first and second respondents pay the applicant’s costs of the proceedings.

Associate:

Dated:    11 June 2021