Federal Court of Australia

Wang v Minister for Immigration, Citizenship and Multicultural Affairs [2025] FCA 575

ORDERS

THE COURT ORDERS THAT:

1.    Leave is granted to the Applicant to file a notice of discontinuance pursuant to rule 26.12(2)(c) of the Federal Court Rules 2011 (Cth).

2.    The Applicant pay the First Respondent’s costs of the proceedings fixed in the sum of $2,800.

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

REASONS FOR JUDGMENT

BURLEY J:

1    The present application concerns the costs of an application brought by the applicant, Li Wang, for judicial review of a decision of the Administrative Appeals Tribunal, affirming a decision of a delegate of the first respondent, the Minister for Immigration, Citizenship and Multicultural Affairs, that refused to revoke the mandatory cancellation of Mr Wang’s visa under s 501CA(4) of the Migration Act 1958 (Cth).

2    On 5 February 2025, Mr Wang notified the Court that he wished to discontinue the proceedings pursuant to rule 26.12 of the Federal Court Rules 2011 (Cth) (FCR) with no order as to costs. The Minister does not oppose discontinuation but insists that the normal rule apply under FCR r 26.12(7) such that Mr Wang, as the discontinuing party, pay the Minister’s costs of the proceedings. The present dispute concerns whether the Court should vary the operation of FCR r 26.12(7) in the manner sought by Mr Wang.

3    Both parties have filed written submissions and agree that the costs application may be dealt with on the papers. Mr Wang is represented by Diana Tang, of counsel. The Minister is represented by Mills Oakley, solicitors.

4    In support of his application Mr Wang relies on a chronology of events that reveals default on the part of the Minister in complying with orders that he supply the application book to Mr Wang including within it a copy of the transcript of his evidence before the Tribunal. In short, Mr Wang submits that timetabling orders made on 22 October 2024 required the Minister to file and serve an application book by 1 November 2024, with Mr Wang to file and serve any amended application and further evidence three weeks later. Ground 2 of Mr Wang’s Originating Application contended that comments adverse to Mr Wang were not put to him during the course of his oral evidence before the Tribunal. In light of this contention, Mr Wang submits that the Minister was obliged to include in the application book the transcript of the Tribunal proceedings in accordance with the Migration Practice Note MIG-1 at [10.2(d)]. However, despite repeated requests, the application book was not served until 20 November 2024 and the transcript was not served until 23 December 2024, when the Court non-sitting period had commenced. On 30 January 2025, the Minister was notified by Mr Wang’s legal representative that Mr Wang wished to discontinue the proceedings.

5    Mr Wang submits that had the Minister complied with the Court orders, the only cost to the Minister before Mr Wang indicated his intention to discontinue would be the compilation of materials readily in the Minister’s possession and service by email on Mr Wang. However, as a result of the Minister’s default in serving the application book and transcript, Mr Wang submits that there have been numerous additional steps required. Mr Wang submits that he ought not be required to compensate the Minister for these additional steps. He submits that until the full application book, including the transcript, was furnished he could not take proper advice as to whether to continue the proceedings. Further, he submits that the Minister has not acted consistently with his obligation to facilitate the just resolution of the dispute as quickly, inexpensively and efficiently as possible in accordance with ss 37M(1)(b) and 37N(1) of the Federal Court of Australia Act 1976 (Cth). He also submits that the Minister’s conduct is in breach of his obligation as a model litigant not to cause unnecessary delay in the handling of litigation and not to take advantage of a claimant who lacks the resources to litigate a legitimate claim, pursuant to Appendix B sub-cls 2(a) and 2(f) of the Legal Services Directions 2017 (Cth) (made under s 55ZF of the Judiciary Act 1903 (Cth)). Mr Wang further submits that as the subject of the proceedings was to secure his liberty, the court must be careful not to make a costs order which may have a “chilling effect” on the others seeking to advance arguments designed to secure their liberty, citing Plaintiff S111A/2018 v Minister for Home Affairs (No 5) [2022] FCA 603 at [26] (Mortimer J, as her Honour then was).

6    The Minister does not dispute the chronology of events summarised above but notes that while the application book was filed and served out of time, this was resolved by consent orders made on 29 November 2024. The Minister also submits that he informed Mr Wang’s legal representative of the delay in filing the transcript, addressed any prejudice to Mr Wang and indicated that he would seek the Court’s leave to file the transcript. He submits that the case was conducted in accordance with the overarching purpose of civil practice and procedure and that while the delays were not ideal (and were apologised for), they did not cause the Minister to complete additional work or cause substantial prejudice to Mr Wang. The Minister also submits that there is no substance to the allegation that he sought to take advantage of the applicant, and correctly submits that non-compliance with the model litigant obligations under the Legal Services Directions 2017 (Cth) may only be raised in proceedings by or on behalf of the Commonwealth, pursuant to s 55ZG(3) of the Judiciary Act 1903 (Cth). He otherwise submits that the proceedings did not relate to securing Mr Wang’s liberty and that Mr Wang’s discontinuance should properly be characterised as the surrendering or abandoning of a claim, and on that basis presses for an order that Mr Wang pay his costs of the proceeding.

7    FCR r 26.12(1) provides that a party claiming relief may discontinue a proceeding in whole or in part by filing a notice of discontinuance. Unless the notice of discontinuance is filed before the return date fixed in the originating application or before the pleadings have closed, the party must obtain the opposing party’s consent (prior to judgment being entered) or the leave of the Court: FCR r 26.12(2). FCR r 26.12(7) addresses the costs consequences of the filing of a notice of discontinuance (whether by consent or by leave or, where permitted, without either consent or leave):

(7)    Unless the terms of a consent or an order of the Court provide otherwise, a party who files a notice of discontinuance under subrule (2) is liable to pay the costs of each other party to the proceeding in relation to the claim, or part of the claim, that is discontinued.

8    In VDCL v Purcell [2024] FCA 107, Horan J helpfully summarised the authorities bearing on the application of r 26.12(7):

13.    The applicant’s position is, in essence, that he should not pay the costs of the respondents because it was reasonable for him to commence the proceeding, and he promptly sought to discontinue the proceeding when it became apparent that he did not have the financial means to pay the associated legal costs.

14.    Rule 26.12(7) is not necessarily founded on a premise that, when a proceeding is discontinued by an applicant, the respondent is the successful party. There may be a range of circumstances leading to the discontinuance of a proceeding, not all of which may be equated to success on the part of either the applicant or the respondent in the sense of a vindication of that party’s position in relation to the claims forming the subject matter of the proceeding. For example, there might be circumstances in which the relief sought in the proceeding has been overtaken or rendered inutile by supervening events or circumstances beyond the control of any of the parties, or where (as was the case in Lai Qin at 624) the applicant “has achieved the relief sought in the action either by settlement or by extra-curial means”.

15.    Nevertheless, previous decisions of this Court have generally accepted that r 26.12(7) prescribes a starting point or a default position that, in the absence of any agreement between the parties, a party who files a notice of discontinuance should pay the costs of each other party unless “good reason” is shown for exercising the discretion to order otherwise: see, for example, Armstrong v Australian Community Pharmacy Authority [2012] FCA 577 at [9], [13]-[14] (Rares J); El-Debel v Secretary, Department of Immigration and Border Protection [2014] FCA 474 at [17]; 141 ALD 611 (Foster J); Diploma Group Limited (No 3) at [2]. While some decisions have described this as creating a “presumption” that the discontinuing party ought pay the costs of the other side unless good reason is shown (see Dalian Huarui Heavy Industry International Co Ltd v Duro Felguera Australia Pty Ltd [2018] FCA 905 at [7] (Barker J), cited in Zhao at [15] and Taylor at [8], [22]), it is unnecessary to determine whether such a description is apposite: cf. Lo v Australian Community Pharmacy Authority [2013] FCA 639 at [60] (Katzmann J), cited in Francis at [20].

16.    The general policy embodied in r 26.12(7) is that, where a party elects to discontinue a proceeding, the other party has a prima facie entitlement to an award of costs: see Travaglini v Raccuia [2012] FCA 620 at [36] (McKerracher J). The Court retains a discretion to displace or depart from that position under r 26.12(7) in the circumstances of the particular case. Like any discretion as to costs, the discretion under r 26.12(7) must be exercised judicially by reference to facts connected with or leading up to the litigation. The need for good reason to be shown for any departure from the default position under r 26.12(7) should not unduly constrain or fetter the judicial discretion to make a different costs order in appropriate circumstances. Nevertheless, the onus is on the party who seeks to depart from the costs consequences under r 26.12(7), other than by the terms of a consent, to make an application to the Court and to explain and establish the basis on which a different costs order should be made: Francis at [20]; Taylor at [9]-[10]; Zhao at [16].

17.    In exercising the discretion under r 26.12(7), it remains relevant to consider the conduct of the parties and the reasons for discontinuance: cf. O’Neill at [13]. However, the fact that the discontinuing party has acted reasonably is not necessarily sufficient of itself to warrant a departure from the costs consequences under r 26.12(7). As McKerracher J observed in Diploma Group Limited (No 3) at [18], even if an applicant acted reasonably in bringing and conducting the proceeding, “unless the litigation is rendered futile by external events, such as a settlement, or the objective of the litigation being achieved in other ways, the discontinuing party is almost always liable for costs”.

9    I am not satisfied that the circumstances that Mr Wang relies upon are sufficient to displace the prima facie position that an applicant seeking to discontinue proceedings should bear the costs of the application. The fact is that Mr Wang commenced the proceedings and, as a result of doing so, the Minister incurred costs. Mr Wang no longer wishes to pursue his application and, indeed, was voluntarily removed from Australia to China around the same time that his legal representative notified the Court of his intention to discontinue. Contrary to his submission, the proceedings are not to secure Mr Wang’s personal liberty, but rather to determine whether the Tribunal fell into jurisdictional error in affirming the Minister’s decision not to revoke the cancellation of his visa. At no stage did Mr Wang contend that his imprisonment or period in immigration detention were not lawful.

10    I do not consider that the circumstances whereby Mr Wang commenced the proceedings – when he was in immigration detention having been transferred there after completing his term of imprisonment and did not have the benefit of legal advice – are sufficient to warrant the conclusion that he could not be regarded as having any opportunity to assess whether or not to proceed with his case and thereby be relieved of the obligation to pay the Minister’s costs upon discontinuation. Nor do I accept that the delay in the service of the application book or the transcript necessarily resulted in the Minister incurring any significant additional costs that would not otherwise have been recoverable. Whilst it was not unreasonable for Mr Wang to only elect to discontinue after he (via his legal advisors) was able to consider the transcript, it does not follow that the prima facie position should be displaced by reason of that fact alone; as observed by Horan J in Purcell extracted above at [17], “the fact that the discontinuing party has acted reasonably is not necessarily sufficient of itself to warrant a departure”.

11    Undoubtedly, the Minister’s correspondence could have been more forthcoming as to when the application book and transcript would be made available and served on Mr Wang. The Minister’s correspondence could also have provided earlier notification and explanation of the delay in providing the transcript. However, the purpose of costs is not punitive and these matters do not persuade me that Mr Wang, as an applicant in proceedings, should not be liable to pay the costs of his application upon discontinuance.

12    The Minister makes the following submission in relation to the award of an amount for costs:

15.    The Minister sought costs in a lump sum fixed in the amount of $2,800. However, the Minister has now incurred additional costs on account of preparing these submissions. The Minister now seeks an order that the applicant pay the first respondent’s costs in the amount of $4,675. That figure represents less than 75% of the Minister’s actual costs of $6,237.26 to reflect the Minister’s costs on a “party and party” basis. The Minister submits that these costs were fairly and reasonably incurred.

(Footnotes omitted)

13    Read literally, this submission suggests that the additional costs incurred in responding to the costs application account for the uplift from $2,800 to $4,675. If so, this is disproportionate and excessive. No evidence supports either figure. There is, however, economy in providing for a lump sum order for costs and thereby saving the parties the additional burden of taxation. In the circumstances, I shall order that Mr Wang pay the costs of the proceedings assessed as a lump sum in the amount of $2,800.00.

Associate:

Dated:    4 June 2025