Federal Court of Australia

AUR23 v Minister for Immigration, Citizenship and Multicultural Affairs [2023] FCA 1349

ORDERS

THE COURT ORDERS THAT:

1.    The first respondent pay the applicant’s costs of the proceeding in the lump sum of $8,500.

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

REASONS FOR JUDGMENT

CHEESEMAN J

1    The parties have reached agreement on orders disposing of the substantive application. The remaining dispute is limited to the question of costs. The applicant seeks his costs in the sum of $12,000 ($6,142.50 for counsel fees and $5,857.50 for solicitor fees). The First Respondent, the Minister for Immigration, Citizenship and Multicultural Affairs, submits that there should be no costs order in this proceeding. The remaining respondents did not take an active part in the proceeding.

2    The question of costs arises in circumstances where the substantive application was resolved without a hearing on the merits following the High Court delivering judgment in Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2023] HCA 10 (Davis HCA), a case which, although involving a different statutory provision, had clear implications for this proceeding.

3    In this proceeding, the applicant sought an urgent interlocutory injunction and substantive relief in the nature of that considered in Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2021] FCAFC 213; 288 FCR 23 (Davis FCAFC), following a purported decision by a departmental officer to screen out requests for Ministerial intervention under s 48B of the Migration Act 1958 (Cth) in purported compliance with guidelines issued by the Minister, entitled “The ministerial intervention power under s 48B of the Migration Act 1958” (the Guidelines).

4    The proceeding was not listed for final hearing pending determination of the appeal to the High Court from Davis FCAFC. The High Court appeal was determined on 12 April 2023 with the High Court, by majority, allowing the appeal: Davis HCA at [38], [63] to [64] (Kiefel CJ, Gageler, and Gleeson JJ), [66] (Gordon J), [194] to [195] (Edelman J) and [254], [324] (Jagot J).

5    The parties did not reach an agreement that the proceeding be dismissed until 22 September 2023. In the intervening period after delivery of Davis HCA, a timetable requiring the matter to be prepared for hearing was entered and the matter was listed for hearing on 11 September 2023. That timetable was subsequently extended on 31 July 2023, and hearing date was moved to 26 October 2023. A review of the Court file indicates that the steps requiring the filing of any further evidence sought to be relied upon by the parties did not occur however a court book was prepared and filed by the Minister in accordance with the orders, following a subsequent extension of time.

6    The evidence on this costs application does not explain why it took about five months after the decision of the High Court for the parties to agree on the disposition of the substantive proceeding. Based on the limited evidence on this application, the concessions made by the Minister were first proffered on 5 September 2023 with proposed orders that the proceeding be discontinued but on the basis that each party pay their own costs. At the same time as making the concessions informed by Davis HCA, the Minister’s solicitors put an argument to the applicant’s solicitors to the effect that a basis for discontinuing the proceeding was that the Court lacked jurisdiction. The Minister contended that any decision not to exercise, or not to consider the exercise of, the s 48B power was a “privative clause decision” pursuant to s 474(7)(a) of the Act. As such, so the argument went, this Court has original jurisdiction in relation to a privative clause decision or a purported privative clause decision if, and only if, the decision meets certain criteria: 476A(1)(b)-(c). The Minister contended that the relevant criteria were not satisfied in the present case and accordingly this Court lacked jurisdiction. The Minister submitted that because the legality of the non-referral decision is tied to the legality of the Minister’s negative procedural decision, the applicant’s case if pressed could only be heard and determined by the High Court under s 75(v) of the Constitution.

7    Further correspondence ensued. The applicant sought to have his costs in the sum of $12,000 paid by the Minister on the dismissal of the proceeding. The Minister responded by asserting directly for the first time, that the reason the proceeding no longer had any utility was “because the Federal Court does not have the jurisdiction to grant declaratory relief”. I interpolate to note that on the evidence before me this argument was first raised by the Minister on 5 September 2023 but was not advanced as the reason that the proceeding had no utility.

8    The impasse was resolved by the parties agreeing to the proceeding being dismissed by consent on the basis that parties file and serve written submissions on costs on or before 20 October 2023, with any reply submissions to be filed by 27 October 2023. Thereafter the costs were to be determined on the papers unless an oral hearing was required by the Court. The Minister’s submissions were filed on 20 October 2023 and the applicant’s submissions were filed 5 days late. The parties subsequently confirmed on 31 October 2023 that they would not file any reply submissions.

9    The parties did not identify any authority that addressed the exercise of the discretion to award costs in circumstances where a proceeding was resolved following an intervening, independent decision of the High Court that the parties acknowledged was relevant to the extant proceeding in which the costs application was made.

10    In Davis HCA the relevant departmental decision was to finalise an application for Ministerial decision under s 351(1) of the Act, by reference to, and in purported compliance with, instructions in relation to Ministerial powers (ss 345, 351, 391, 417, 454 and 501) issued by the Minister but without referral of the particular decision to the Minister. By majority, the High Court held that the relevant departmental decision — which was a procedural decision, to consider or not to consider making a substantive public interest decision – exceeded the executive power of the Commonwealth because that decision as to whether to exercise the relevant power given by s 351(1) of the Act could be made only by the Minister: Davis HCA at [14] to [19] and [38] (Kiefel CJ, Gageler and Gleeson JJ), [66] (Gordon J, agreeing with [14] to [15]); see also [145] to [147] (Edelman J) and [316] to [318] (Jagot J). Based on the circumstances in Davis, the Ministerial instruction was construed as impermissibly delegating, albeit under a different rubric (“unique and exceptional circumstances”), the evaluative decision-making required by the public interest test, which is reserved to the Minister.

11    In this application, the Minister has conceded that the departmental officer’s decision not to refer the applicant’s request for Ministerial intervention to the Minister was beyond power. Neither party addressed any submissions as to whether or not the s 48B Ministerial Guidelines in issue on this application could be relevantly distinguished from the instructions in issue in the Davis proceeding.

12    As mentioned, in inviting the applicant to discontinue the proceeding on the basis of the concessions offered by the Minister, the Minister also contended in correspondence, and again in submissions on this costs application, that this Court lacked jurisdiction to decide the relief sought by the applicant.

13    The applicant strongly disputes the Minister’s characterisation of the relevant decision as a negative procedural decision by the Minister. The applicant submits that to characterise the decision in this way impermissibly glosses over the departmental officer’s key role in applying the Ministerial Guidelines to assist the Minister, which is the very controversy that was decided in Davis HCA and which informed this proceeding. The applicant points to the fact that the Davis proceeding was also commenced in the Federal Court and the decision there was characterised as the “Departmental officer’s decision not to refer a relevant request to the Minister”, which was not a migration decision. The applicant further submits that it was not disputed in Davis that the non-referral decision was an “exercise of non-statutory executive power and so did not amount to a decision made, proposed to be made or required to be made “under” the Act”: Davis FCAFC at [231] to [234] (Charlesworth J). At [234], Charlesworth J encapsulated the position as follows:

At first instance in both cases it was common ground that a Departmental officer’s decision not to refer a relevant request to the Minister was not a migration decision and so was not affected by the ouster of jurisdiction in s 476A of the Act. More specifically, it was not disputed that the relevant act of non-referral was done in the exercise of non-statutory executive power and so did not amount to a decision made, proposed to be made or required to be made “under” the Act. The respondents did not object to the competency of the applications for judicial review, premised as they were on the jurisdiction conferred under s 39B(1) of the Judiciary Act in relation to decisions or actions that did not fall within the definition of a “migration decision”.

14    The applicant submits that there was no “privation of jurisdiction” that can be relied on to deprive the applicant of his costs. Further, that even if available, any such jurisdictional argument is technical, and one on which the Commonwealth, as a model litigant, ought not rely in the present application.

15    The applicant submits that the subject matter of the dispute “went away” when the Minister conceded that the departmental officer’s decision was in excess of power and therefore that the applicant’s Ministerial intervention request had not been finalised. Further, that the Minister’s concession was made as a result of the decision in Davis HCA. The applicant’s submits that the Minister’s concession was based on the Minister’s loss in Davis which concerned legislative provisions operating in the same way as those in the present application. The applicant says that it is a matter of technicality that it was necessarily the applicant who “discontinued” the proceedings.

16    The Minister’s submission is that up until the decision in Davis HCA, both parties acted reasonably in their conduct in, respectively, initiating and defending the application. Further, that once the High Court delivered judgment it was reasonable for the Minister to make the concession made that rendered the application inutile. In these circumstances, the Minister submits that the appropriate order is that there be no order as to costs.

CONSIDERATION

17    The Court’s power to award costs is found in s 43 of the Federal Court of Australia Act 1976 (Cth). The Court has a general discretion, but it is a power that must be exercised judicially.

18    Where, as here, a proceeding is resolved before a hearing on the merits, courts will usually make no order as to costs, such that each party bears its own costs: Nine Network Australia Pty Ltd v Civil Aviation Safety Authority (No 2) [2021] FCA 1337 at [56] (McKerracher J).

19    In an oft-cited passage in Re Minister for Immigration & Ethnic Affairs (Cth); Ex Parte Lai Qin [1997] HCA 6; 186 CLR 622 at 624 to 625, McHugh J observed:

In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extracurial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action. …

Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. … But such cases are likely to be rare.

If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases.

20    I am satisfied that this is one of the relatively rare cases in which, notwithstanding that there has been no hearing on the merits, it is appropriate to order that the Minister pay the applicant’s costs: see the discussion in ONE.TEL Ltd v Deputy Commissioner of Taxation [2000] FCA 270; 101 FCR 548 at [7] (Burchett J).

21    In reaching this conclusion, I have had regard to the fact that the Minister was a party to this application and the Davis proceeding and that both proceedings involved analogous issues of principle. Taking into account the passage of Davis through the court hierarchy, although I am satisfied that both the applicant and the Minister acted reasonably in, respectively, commencing, and defending, the proceeding up until the time when the High Court delivered judgment in Davis HCA, I am also satisfied that the applicant was almost certain to have succeeded if the matter had been fully tried given the outcome in Davis HCA. The applicant has achieved in practical terms the personal outcome for which he contended as a consequence of the decision of Davis HCA. I do not have before me on this application the s 48B Ministerial Guidelines that were in issue in the substantive application, however, as mentioned above, the Minister has not sought to distinguish those guidelines from the instruction in Davis. Once Davis HCA was delivered, it was reasonable for the Minister to make the concession that he did. Once that concession was made, it was reasonable for the applicant to agree to the dismissal of his application. Given the view I have reached it is not necessary to reach a view as to whether the delay in the Minister making the concessions as to the impact on this proceeding of the decision in Davis HCA was reasonable. The evidence on this costs application does not address this issue.

22    I have not overlooked the jurisdictional argument that the Minister has flagged in correspondence and in his submissions on this costs application. In my view, it is not appropriate in the present application to engage with and predict the outcome of that argument which has only been revealed at this stage of the proceeding and which has been rendered entirely hypothetical by the parties’ consensus as to the dismissal of the proceeding. As the Minister correctly acknowledges in his submissions, where there has not been a hearing on the merits, the Court should not resolve the issue of costs by engaging in something in the nature of a hypothetical trial: Australian Securities Commission v Aust-Home Investments Ltd [1993] FCA 585; 44 FCR 194 at 201 (Hill J); Ex parte Lai Qin at 624.

23    In any event, on the basis of the material before me, I am satisfied that the critical factor that informed the discontinuance of the proceeding was the Minister’s concession that the departmental officer acted in excess of power and that the applicant’s request would be treated as extant. The dismissal was not driven by the Minister’s argument as to lack of jurisdiction. That outcome was all but inevitable following the decision in Davis HCA.

CONCLUSION

24    For these reasons, in my view the Minister should pay the costs of the applicant Given the sum involved, and as the Minister has not sought to address the sum claimed by the applicant in respect of costs by filing submissions in reply on this point, I regard it to be appropriate and proportionate to award these costs in the lump sum of $8,500. I will make orders accordingly.

Associate:

Dated:    3 November 2023