Federal Court of Australia

Wilson v State of Victoria (Costs) [2024] FCA 1190

ORDERS

THE COURT ORDERS THAT:

1.    The Applicants pay the costs of the First Respondent fixed in the sum of $30,000.

2.    The Applicants pay the costs of the Second Respondent fixed in the sum of $20,000.

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

REASONS FOR JUDGMENT

HESPE J:

INTRODUCTION

1    On 20 February 2023, acting under s 31A of the Federal Court of Australia Act 1976 (Cth) (FCA Act), the Court gave summary judgment dismissing a proceeding instituted by Mr and Mrs Wilson against the State of Victoria and the Commonwealth: Wilson v State of Victoria [2023] FCA 111. In so doing, the following orders were made in respect of costs:

2.     Any costs to be awarded in the proceeding are to be fixed by way of a lump sum.

3.     On or before 4.00 pm on 6 March 2023, the parties:

(a)     file proposed agreed orders on any orders for lump sum costs in the proceeding (including reserved costs); alternatively

(b)     in the absence of agreement, file written submissions, limited to three (3) pages on the appropriate lump sum costs orders to be made in the proceeding, together with any affidavit material in support of those submissions and a proposed form of order.

2    On 7 March 2023, the following further orders in respect of costs were made, nominally by consent:

1.     The Applicants pay the costs of the First Respondent fixed in the sum of $30,000.

2.     The Applicants pay the costs of the Second Respondent fixed in the sum of $20,000.

3    On appeal, the Full Court found that Mr and Mrs Wilson had been inadvertently denied procedural fairness in respect of the issue of costs: Wilson v State of Victoria [2023] FCAFC 204 at [58] (Logan, Perry and O’Sullivan JJ) (Wilson Appeal). By order of the Full Court made on 22 December 2023, the order of 7 Mach 2023 was set aside and the proceedings remitted to the original jurisdiction for the determination of costs. Mr and Mrs Wilson are not seeking to dispute the quantum of costs but submit that there should be no order as to costs at all.

4    In the Full Court, the parties filed written submissions with respect to the issue of costs. On remitter, the parties were invited to rely upon those written submissions as to how costs should be awarded in the original jurisdiction and were asked if they were content for the issue of costs to be determined on the papers. The parties agreed, subject to the applicants requesting leave to file further submissions. That leave was granted and further submissions were filed by the applicants and the first respondent (in reply).

5    Having considered the submissions made by each of the parties, for the reasons that follow, I am satisfied that the appropriate order is that costs follow the event. As the parties were agreed as to the quantum of costs, orders in terms consistent with those of the previous orders of 7 March 2023 will be made.

APPLICABLE PRINCIPLES

6    The principles relating to costs were helpfully summarised by Cheeseman J in Hamilton v Meta Platforms, Inc. (Costs) [2023] FCA 1496 at [4]–[9].

7    Generally, the Court has the power to order costs in all proceedings before it: s 43(1) of the FCA Act. The exercise of the power to award costs is discretionary, unless another Act provides otherwise: s 43(2) of the FCA Act.

8    The discretion to award costs is unconfined but must be exercised judicially, that is, according to relevant considerations and taking into account the contextual features and facts of the litigation: El-Debel v Micheletto (Trustee) (No 2) [2021] FCAFC 146 at [2] (Markovic, Derrington and Colvin JJ).

9    The general presumption is that costs will follow the event, with the general position being that the successful party will be awarded costs against the unsuccessful party: Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 at [67] (McHugh J, Brennan CJ agreeing). In exercising its discretion to award costs, a court may deviate from the general presumption but should not do so on the basis of private opinion, benevolence, or sympathy for the unsuccessful party: Oshlack at [22] (Gaudron and Gummow JJ). A court may depart from the general presumption if, for example, there has been some disentitling conduct by the successful party, such as unreasonable delay, or a lack of cooperation: Oshlack at [69] (McHugh J, Brennan CJ agreeing); Northern Territory v Sangare [2019] HCA 25; 265 CLR 164 at [25].

10    In exercising the discretion to order costs, the Court must take into account any failure to conduct the proceeding in a way that is consistent with the over-arching purpose of facilitating the just resolution of disputes according to law, and as quickly, inexpensively and efficiently as possible: s 37N(4) of the FCA Act; LFDB v SM (No 2) [2017] FCAFC 207 at [7] (Besanko, Jagot and Lee JJ).

11    A legitimate public interest in the importance of the issues resolved is a factor that the Court may take into account when exercising the discretion conferred by s 43 of the FCA Act: Fisse v Secretary, Department of the Treasury & Anor (No 2) [2008] FCAFC 200; 253 ALR 52 at [9] (Stone, Buchanan and Flick JJ).

12    Having regard to the fact that Mr and Mrs Wilson are litigants in person, the following observations of Hodgson CJ in Eq in Bhagat v Royal and Sun Alliance Life Assurance Australia Ltd [2000] NSWSC 159 (at [13]) are noted:

… I accept that a court does have to make allowances for the position of litigants in person, and to try to ensure that such a litigant does not lose out because of lack of expertise; although there is a limit to what the Court can do in that regard, while still remaining an impartial determinant of a dispute. The Court may in those circumstances refrain from making orders against litigants in person for conduct that might be considered as justifying orders for costs against represented litigants. By the same token, litigants in person can cause great hardship and expense to other parties, through making allegations and claims that lawyers would recognise as allegations and claims that could not reasonably or even properly be made, and through making proceedings much longer and much more expensive than they would otherwise be, by not focusing accurately on the real issues in the case. Conduct of that nature by legally represented parties would often lead to orders for indemnity costs. Litigants in person may escape the consequence of indemnity costs, but I do not think that the circumstance that a party is a litigant in person is a ground for displacing the ordinary result that costs follow the event.

13    The issue before the Court does not concern an order for costs to be paid on an indemnity basis, rather, whether Mr and Mrs Wilson as litigants in person should be subject to the general presumption that costs follow the event.

CONSIDERATION

14    Mr and Mrs Wilson’s submissions as to why the ordinary rule as to costs should not be applied in this case addressed four primary issues:

(1)    Mr and Mrs Wilson’s case concerned their human rights, was of public importance and involved novel issues;

(2)    their case was not completely untenable;

(3)    the respondents engaged in disentitling conduct; and

(4)    Mr and Mrs Wilson suffer financial hardship.

Human rights and public interest

15    As Mortimer J (as her Honour then was) said in Knowles v Commonwealth of Australia (No 2) [2022] FCA 1003 (Knowles (No 2)), I too accept that the proceeding had a public interest element because “the vaccination requirements, and the border restrictions, affected a large proportion of the Australian community, in a myriad of ways”. As her Honour observed at [38]:

While ultimately the Court found none of the causes of action had reasonable prospects of success (a matter which tends in favour the respondents’ costs arguments), that does not negate the public interest in understanding whether the kinds of challenges made on behalf of the applicants were legally arguable.

16    As such, the observations made by Beech-Jones CJ at CL (as his Honour then was) in Kassam v Hazzard (No 2) [2021] NSWSC 1599 at [11] are apposite:

The making of either a form of delegated legislation or executive act which had the effect of imposing significant differential limitations on the free movement of people of a sizable class, albeit a class defined by their own choices and not an innate characteristic, is a significant step. The type of action taken by the impugned orders is not something that has generally been undertaken since the time of war. Subject to the considerations that are addressed next, there is a strong public interest in affected persons being able to test the legal validity of such a step without facing financial ruin or at least severe hardship if the challenge fails. To so hold serves the rule of law. 

17    However, as Mortimer J identified in Knowles (No 2) at [39], the rule of law should promote access to the courts for all members of the community where they have a grievance that the law recognises as arguable. It follows that the public interest and human rights nature of the claims carries less weight where the claims are found to have no reasonable prospects of success than when arguable claims go to trial and are not successful.

18    Furthermore, although the proposition is not accepted by Mr and Mrs Wilson, their claims were not entirely novel. The applicants’ claims made in reliance on s 51(xxiiiA) were not materially different from those summarily dismissed by the New South Wales Supreme Court in Kassam and the Federal Court in Knowles v Commonwealth of Australia [2022] FCA 741. To the extent that Mr and Mrs Wilson sought to make novel claims based on the Imperial Acts those claims were untenable and misconceived. The fact is these proceedings were continued, in the face of the summary dismissal application, despite the existence of a number of unsuccessful challenges which shared some features in common with the way the causes of action and contentions were put in this proceeding on behalf of the applicants (see Knowles at [49]).

19    I am not satisfied that of itself the fact that there may be some public interest in understanding whether the kinds of challenges made by Mr and Mrs Wilson were legally arguable of itself justifies a departure from the ordinary rule.

Untenable

20    It was found that the claims made by Mr and Mrs Wilson enjoyed no reasonable prospect of success and those claims were summarily dismissed. This conclusion was upheld on appeal. As the Full Court explained, it was not appropriate to make an order that the pleadings be struck out and repleaded, because fundamentally they could never be improved as they sought to raise propositions which were in law untenable: Wilson Appeal at [52] (Logan, Perry and O’Sullivan JJ). There were costs thrown away because of the unsustainable nature of the Originating Application and Statement of Claim, which were not improved by the amendments made to them.

21    The causes of action, and contentions supporting them, were found to have no reasonable prospects of success. I am satisfied that this is a matter that points strongly in favour of the application of the ordinary rule.

Disentitling conduct

22    Mr and Mrs Wilson claim that the respondents engaged in various forms of conduct which ought to result in no costs order being made.

23    It is alleged that the Commonwealth, by failing to file a genuine steps statement, engaged in disentitling conduct. That submission is not accepted. It is difficult to understand what was to be achieved by the filing of such a statement. Orders were made at an early stage of the proceedings for each of the first and second respondents to write to the applicants outlining the defects in the applicants’ claim. Those orders were complied with.

24    There is also an allegation that the Commonwealth was not thoroughly honest with the Court. The applicants contend that the Commonwealth’s conduct was misleading as to who was in effective control of pandemic management due to “secretive” “National Cabinet” ministries. It is not apparent how that allegation could improve the strength of the legal propositions which the applicant sought to advance and which were summarily dismissed.

25    Allegations are also made that the Commonwealth did not properly address the applicants’ submissions concerning their human rights at first instance. The applicants’ submissions concerning human rights breaches were found to be untenable at first instance. I am not satisfied that there was a failure by the Commonwealth to properly address the submissions or to meet its obligations as a model litigant. The Full Court found that the submissions put on appeal by the appellants differed in some ways from those put at first instance. Those submissions were also found to be untenable. I am not satisfied that there was disentitling conduct by the Commonwealth.

26    In so far as the first respondent (State of Victoria) is concerned, it is contended that it too failed to take genuine steps to resolve the dispute. The submission is rejected for the reasons given above.

27    The applicants further allege that the State failed to draw the Court’s attention to relevant judicial authorities or failed to point out distinguishing facts in those authorities. I am not satisfied that the State engaged in disentitling conduct.

28    The unfairness of which the applicants complain is largely the result of the applicants’ lack of legal training rather than any unfair conduct engaged in by the respondents. The applicants’ case has been found at first instance and on appeal to carry no reasonable prospects of success. None of the authorities referred to by the applicants nor the bases on which they contend those authorities ought to be distinguished advance the applicants’ claims.

29    The applicants further contend that the respondents provided a “barrage of evidence” and in so doing acted unfairly. The Court was provided by the first respondent with copies of the documents referred to in the pleadings (particularly the applicants’ Amended Statement of Claim). The respondents did not abuse the Court’s processes in providing those documents.

30    The types of disentitling conduct that may result in a successful party being denied all or part of its costs were summarised by the Full Court in Ruddock v Vadarlis (No 2) [2001] FCA 1865; 115 FCR 229 at [15] (Black CJ, Beaumont and French JJ) in the following terms (citations omitted):

Usually the circumstances in which a successful party is denied all or part of its costs have to do with its conduct of the proceedings … Within the general discretion to award costs, costs may be refused where, for example, the applicant has made an exaggerated claim which has occupied a significant proportion of the proceedings and has succeeded only on a minor aspect of its original claim. Costs may be apportioned according to success or failure on particular distinct or severable issues … And a trial judge may award only a proportion of the successful party’s costs if the conduct of that party at trial was such as to unreasonably prolong the proceedings.

31    I am not satisfied that conduct on the part of the first and second respondents resulted in the proceedings being prolonged or that the respondents have otherwise failed to act in accordance with the overarching purpose embodied in s 37M of the FCA Act.

Financial position

32    The applicants provided evidence to the Court of their financial position. I accept that to satisfy an order to pay costs it is likely that Mr and Mrs Wilson’s ability to retain their family home would be imperilled and would be very likely to inflict harm on their financial security.

33    However, the impecuniosity of the applicants is not of itself a basis for an order for no costs. It would be contrary to principle that somehow an impecunious litigant has a greater license to bring and maintain an unmeritorious appeal than another litigant not in that position: Ringshaug v Comcare (No 2) [2017] FCA 349 at [9] (Bromwich J). The relative financial positions of the parties do not provide a principled reason to deprive the respondents of their costs. As the High Court observed in Sangare at [27]:

…In point of principle, it is basic justice that a successful party should be compensated for expenses it has incurred because it has been obliged to litigate by the unsuccessful party. That consideration of basic justice does not lose its compelling force simply because the successful party happens to be wealthy: the successful party, whether rich or poor, did not ask to be subjected to the expense of unmeritorious litigation. The statutory power to order costs affords the successful party necessary protection against unmeritorious litigation; and unmeritorious litigation is no less unmeritorious because it is pursued by a person who is poor or who is a litigant-in-person.

34    The applicants’ case was found to be untenable and had no reasonable prospects of success. The respondents might choose to consider the financial position of the applicants when deciding whether to seek recovery of those costs and/or whether to enter into some sort of payment arrangement.

Conclusion

35    Taking into account the matters raised by the parties, I am satisfied that the usual order that costs follow the event is the correct order in the present application.

Associate:

Dated:    15 October 2024