Federal Court of Australia

Turner v Chandler Macleod Group Limited (Costs) [2026] FCA 458

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to r 40.02(b) of the Federal Court Rules 2011 (Cth), the applicant to pay the first respondent’s costs in the fixed amount of $20,000.

2.    Proceedings otherwise dismissed.

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

REASONS FOR JUDGMENT

NEEDHAM J:

1    I gave judgment in this matter on 27 February 2026 in Turner v Chandler Macleod Group Limited [2026] FCA 139 (the judgment), inter alia striking out the Originating Application and Statement of Claim against the first respondent, making other orders as sought by the remaining respondents, and making suppression orders. These reasons presume familiarity with the judgment and uses the same defined terms.

2    The first respondent indicated that it would seek costs of the CMG Application, and has now put on submissions and evidence in support of a costs order against Mr Turner. Mr Turner was given 28 days to file submissions and evidence in response to the costs application, but did not do so. The question of costs was reserved on the expiry of those 28 days, to be determined on the papers. On 10 April 2026, Mr Turner and Mr Forno, the solicitor for the BHP respondents, appeared before me at a case management hearing to make the final suppression orders sought by the BHP respondents. At that case management hearing, Mr Latham for the first respondent also appeared to raise the fact that no submissions and evidence had been filed by Mr Turner in relation to costs. As the matter had already been reserved, and Mr Turner did not seek any variance of those orders, I have proceeded to determine the matter of costs.

3    I noted in the judgment at [110] that my preliminary view was that any costs order sought should be a lump-sum costs order. The first respondent now seeks an order for lump-sum costs in the fixed amount of $20,000.

4    The first respondent’s application is made under s 43 of the Federal Court of Australia Act 1976 (Cth) (FCA Act) which gives the Court a broad jurisdiction to award costs. That section is subject to the exceptions set out in s 570 of the Fair Work Act 2009 (Cth) which (relevantly) provides that costs may be ordered only if the Court is satisfied that the proceedings were instituted vexatiously or without reasonable cause (s 570(2)(a)) or that the party’s unreasonable act caused the other party to incur the costs (s 570(2)(b)). The first respondent submitted that both exceptions apply here; the application was made without reasonable cause, and the applicant acted unreasonably in pursuing the matter after the CMG Application was filed on 5 December 2025.

5    The first respondent relied on [71] of the judgment which says:

Even taking into account that Mr Turner is not legally trained or represented, and that the question of federal jurisdiction is somewhat not easy to understand, it still does not arise on the most generous reading of the Originating Application and the Statement of Claim that I should, in the context of the history of this matter and of the terms of the CMG Deed, consider that Mr Turner is likely to succeed in any of the claims made against the first respondent. No grounds for any basis to set aside the CMG Deed were pleaded or articulated in submissions beyond a high-level unparticularised assertion that the deed was illegal.

Applicable principles

6    The approach to be taken to an application for costs under a Fair Work Act proceeding starts on the basis that generally, no liability for costs arises because public policy recognises the power imbalance between workers and employers, and wishes to enable litigants “with genuine grievances and an arguable evidentiary and legal basis” to commence proceedings and have their matters heard (Ryan v Primesafe [2015] FCA 8; 323 ALR 107 (Mortimer J) at [64]). Rangiah J, in Tamu v World Vision Australia (No 2) [2021] FCA 565 referred to the “exceptional” nature of the power to order costs in an otherwise no-costs jurisdiction (at [15]).

7    I will consider first whether one of the statutory conditions in s 570(2) of the Fair Work Act is satisfied, before considering whether it is appropriate to exercise the discretion to order costs.

Did the applicant institute the proceedings without reasonable cause, or act unreasonably, causing the first respondent to incur costs?

8    The fact that an application fails does not mean that it was commenced without reasonable cause. Rather, the Court must consider whether the applicant had reasonable cause to commence the proceedings at the time the proceedings commenced. At [75] of the judgment, I considered whether the proceedings were bound to fail on the applicant’s own version of the facts; see Kanan v Australian Postal and Telecommunications Union [1992] FCA 539; 43 IR 257 at 264-5. The first respondent’s costs submissions contend that I should take this principle into account on costs, saying that “[g]iven the judgment of the Court; that exception has been self evidently satisfied”. The first respondent submitted that the proceedings were commenced against the first respondent with no reasonable cause of action.

9    Having regard to my findings in the judgment that the applicant’s claim against the first respondent raised issues that had been previously settled under the CMG Deed, my finding that the first respondent was covered by the release clause in the CMG Deed, and that the claim to set aside the CMG Deed was not properly brought, I am satisfied that the proceedings were instituted without reasonable cause. It is not every case where proceedings which are struck out for failing to disclose a reasonable cause of action will necessarily enliven that power; here, however, the claim that the CMG Deed was “illegal” was not articulated beyond that bald statement. The CMG Deed clearly released the first respondent from claims by the applicant, and as noted at [56] of the judgment, Mr Turner was represented by lawyers.

10    The first respondent also relied on the exception in s 570(2)(b) of the Fair Work Act, submitting that the applicant acted unreasonably in pursuing the matter. It submitted that “it was made quite clear” from the time that the CMG Application was filed on 5 December 2025, that the “applicant’s case was without reasonable prospects and that he would [be] at risk of costs if he pursued the matter further”. It relied on Australian and International Pilots Association v Qantas Airways Ltd (No 3) [2007] FCA 879; 162 FCR 392 (Tracey J) where his Honour said at [36]:

The prosecution of any incompetent or hopeless case can be regarded as “an unreasonable act” within the meaning of s 824(2) [of the Workplace Relations Act 1996 (Cth)]. Conversely, in my opinion, the pursuit of a contentious, and ultimately unsuccessful, argument is not an unreasonable act.

11    The first order sought in the CMG Application was that the Court set aside the Originating Application as against the first respondent on the basis that it is an abuse of process “in that it seeks to relitigate matters that have been settled and where earlier litigation that deals with similar matters has been concluded”. I understand that the first respondent’s submissions that it was “clear” from 5 December 2025 that the application was without reasonable prospects of success, refers to the applicant’s understanding that the claim raised matters that had been settled under the CMG Deed. As Tracey J’s observations reveal, whether a party has engaged in an “unreasonable act or omission” will depend on the circumstances of the case and is inherently sensitive to context.

12    Given my findings at [70] of the judgment as to the lack of any proper ground for the application to set the CMG Deed aside, and the failure by Mr Turner to bring evidence supporting his claim that the CMG Deed was “illegal”, it should have been clear to Mr Turner that his claim was “hopeless”. Accordingly, prosecuting these proceedings was an unreasonable act. This is demonstrated by Mr Turner’s submission that he wished to identify the “human person [who] instructed Ready Workforce to write that deed” (see paragraph [58] of the judgment). That is not a reasonable basis for commencing proceedings where he was restrained from doing so by the clear terms of the CMG Deed. As set out in Mr Russell’s affidavit of 12 March 2026, the first respondent has incurred costs by way of the institution and prosecution of this matter.

13    I find that the jurisdiction to award costs in s 570(2) is enlivened.

Should the Court exercise its discretion to award costs under s 43(1) of the FCA Act?

14    The satisfaction of a pre-condition in s 570(2) is a necessary condition of an award of costs, but is not determinative of the issue (see Bywater v Appco Group Australia Pty Ltd [2019] FCA 799 at [11]). As observed by Rangiah J in Tamu at [15], the party’s conduct must rise “significantly above unsatisfactory” before a Court will be inclined to exercise its jurisdiction.

15    The Full Court in Shea v EnergyAustralia Services Pty Ltd (No 2) [2015] FCAFC 14 (Rares, Flick and Jagot JJ), at [10]-[11] set out the test in the following terms:

The power to order a party to pay costs conferred by s 570 is enlivened once one of the jurisdictional criteria in s 570(2) has been satisfied. After that has occurred, the court is then authorised to exercise its discretion to award costs under s 43(1) of the Federal Court of Australia Act 1976 (Cth), having regard to all of the circumstances …

However, the power to order costs, once a criterion in s 570(2) has been satisfied, is discretionary and should be exercised, not so as to impose a penalty or punishment on the losing party but to provide an appropriate means of compensating the successful party having regard to all of the circumstances: see Foots v Southern Cross Mine Management Pty Ltd [2007] HCA 56; (2007) 234 CLR 52 at 62-65 [24]-[34] per Gleeson CJ, Gummow, Hayne and Crennan JJ; Kazar v Kargarian [2011] FCAFC 136; (2011) 197 FCR 113 at 115-117 [2]-[9] per Greenwood and Rares JJ.

16    The first respondent submitted that “there is no reason why the discretion should not be exercised”, relying on the observations in Ryan v Primesafe at [64] that this is not a case involving “genuine grievances and an arguable evidentiary and legal basis”. It further submitted that the fact that the applicant was not legally represented should not weigh against the exercise of that discretion. It relied on Bhagat v Global Custodians Ltd [2002] FCAFC 51 (O’Loughlin, Whitlam and Marshall JJ) where Mr Bhagat raised a ground of appeal that the award of indemnity costs was unreasonable and unfair as he was a litigant in person who had acted in good faith without the benefit of legal advice. The Full Court was not persuaded that it should interfere with Young J’s decision at first instance that it was appropriate to order indemnity costs (see [60] of Bhagat). At [56], the Full Court noted that Young J, in coming to his conclusion that an order for indemnity costs was appropriate, referred to remarks that had been made by Hodgson CJ in Eq in Bhagat v Royal & Sun Alliance Life Assurance Australia Ltd [2000] NSWSC 159, where his Honour said at [13]:

... 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 otherwise would 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 circumstances that a party is a litigant in person is a ground for displacing the ordinary result that costs follow the event.

17    Commenting that he agreed with the remarks of Hodgson CJ, Young J said in [66] of his reasons:

The Chief Judge is not, however, saying that litigants in person always escape the consequence of indemnity costs. It seems to me that where, as here, ample opportunity has been given to the plaintiff to amend so that there is a proper statement of claim, particularly in a case such as the present where it appears that Mr Bhagat has a substantial fighting fund, some of which may be available to obtain expert legal advice, where after a long period of time the defendants are still embarrassed by pleadings which do not show a proper case, it seems to me that it is appropriate, after taking all these matters into account, to make an order to indemnity costs.

18    The first respondent submitted that in any case, the applicant was not unfamiliar with litigation or with matters arising under the Fair Work Act. It noted that Mr Turner had experience litigating a class action based upon contraventions of the Fair Work Act. Including a case (Turner v Tesa Mining (NSW) Pty Limited [2019] FCA 1644; 290 IR 388) and an appeal (Augusta Ventures Limited v Mt Arthur Coal Pty Limited [2020] FCAFC 194; 283 FCR 123) about security for costs under that Act, as well as a personal case involving long service leave. It would have been helpful to have Mr Turner’s submissions on this point. I do not in the circumstances give this matter great weight given that I must look, in determining whether to exercise my discretion, to the matters before me.

19    The evidence does not demonstrate that the first respondent put Mr Turner on notice of the lack of reasonable prospects on or before 5 December 2025. However, given that I have found that the proceedings were commenced with no reasonable cause as against the first respondent (see [71] of the judgment) and that prosecuting the proceedings was unreasonable, it is appropriate to order costs against the applicant. I also take into account in exercising this discretion that the first respondent seeks a lump-sum which is, as set out by Mr Russell in his affidavit as to costs, less than would be recovered on an order for costs in accordance with the Federal Court Scale (see Schedule 3 of the Federal Court Rules 2011 (Cth)).

Order for lump-sum costs

20    Rule 40.02(b) of the Federal Court Rules allows the Court to order an award of costs in a lump sum, instead of, or in addition to, any taxed costs. The first respondent seeks that the applicant pay its costs thrown away in respect of the Originating Application and the Statement of Claim in the fixed amount of $20,000.

21    The principles applicable to the assessment of lump-sum costs awards are well-established, and were recently summarised by Feutrill J in Frigger v Professional Services of Australia Pty Ltd (No 7) [2025] FCA 1639 at [6]:

(1)    As costs were awarded without any further description, the costs are to be as between party and party: r 40.01 of the Rules. The dictionary to the Rules defines those costs as ‘only the costs that have been fairly and reasonably incurred by the party in the conduct of the litigation’. See, also, Hislop v Paltar Petroleum Ltd (No 4) [2017] FCA 1632 at [6] (Gleeson J).

(2)    Determination of a lump-sum is not the result of a process of taxation or assessment of costs. The lump-sum can only be fixed broadly having regard to the information before the Court: Harrison v Schipp [2002] NSWCA 213; 54 NSWLR 738 at [22] (Giles JA); Beach Petroleum NL v Johnson (No 2) [1995] FCA 350; 57 FCR 119 at 124 (von Doussa J); Hadid v Lenfest Communications Inc [2000] FCA 628 at [35] (Lehane J). That is, the Court is not required to undertake a detailed examination of the kind that would be appropriate to a taxation or formal costs assessment as to do so would defeat the purpose of making a lump-sum order: Bitek Pty Ltd v IConnect Pty Ltd [2012] FCA 506; 290 ALR 288 at [23] (Kenny J).

(3)    Determination of the lump-sum involves estimation and not arithmetic: Bayley & Associates Pty Ltd v DBR Australia Pty Ltd [2014] FCA 346 at [17(e)] (Foster J). The sum of costs fixed should be proportionate to the nature, including the complexity, of the case: Bitek at [18]. See, also, Hislop at [7].

(4)    The starting point for the determination is the charges rendered or estimated by the solicitors for the party entitled to costs. There may be an impressionistic discount of those costs in order to take into account the contingencies that would be relevant in any formal costs assessment. But, the approach taken to determining the lump-sum must be logical, fair and reasonable: Beach Petroleum at 124; Hamod v New South Wales [2011] NSWCA 375 at [820] (Beazley JA, Giles JA and Whealy JA agreeing); Bitek at [18]; Innes v AAL Aviation Ltd (No 2) [2018] FCAFC 130 at [17] (Tracey, Bromberg and White JJ).

(5)    While it is the usual practice of the Court to apply a discount when determining a lump-sum, ‘that does not mean that the Court must apply a percentage discount to the sum sought by the successful party and the Court “must be astute not to cause an injustice to the successful party” by applying “an arbitrary ‘fail safe’ discount on the costs estimate submitted to the court”. Thus, if the court can be confident that there is little risk that the sum includes costs that might be disallowed on assessment, the case for a discount is seriously undermined.’: Hancock v Rinehart (Lump sum costs) [2015] NSWSC 1640 at [56]-[57] (Brereton J).

(6)    In determining the lump-sum the Court is entitled to take into account the evidence that is before it, its own observations of the proceeding and the judge’s own experience. The Court may have regard to any applicable scale of costs which regulates the recoverable amount on party and party basis: AAL Aviation at [18]; Fewin Pty Ltd v Burke (No 3) [2017] FCA 693 at [61] (Markovic J); Hislop at [12]. Although scales may provide assistance and will usually be influential, the Court is not bound to apply strictly any applicable scale of costs: Geneva Laboratories Ltd v Prestige Premium Deals Pty Ltd (No 5) [2017] FCA 63; 122 IPR 279 at [86(8)] (Bromwich J).

22    Having read Mr Russell’s affidavit, I am satisfied that the costs are reasonable. However, the application and the affidavit do not comply with the provisions of cl 4 of the Costs Practice Note (GPN-COSTS) which requires that a Costs Summary be filed in support of the lump-sum claim which “succinctly address[es] the relevant matters set out in Part B” of Annexure A to the Practice Note. I refer to my reasons in McGinn v Australian Information Commissioner (Costs) [2025] FCA 1007 at [22]-[26] as an example of an applicant for costs complying with the Practice Note.

23    The verifications required by Part A of Annexure A to the Practice Note were not complied with (although some of the matters required to be verified – including the accuracy of the calculations and that the costs applicant is not claiming more than it would be liable to pay for costs and disbursements, are addressed). Part A.1 of Annexure A requires that Mr Russell depose that he had read the Practice Note; he does not. Part A.4 requires that the deponent verify that the amounts claimed are capable of further verification through source material such as invoices. Although the affidavit annexed a summary of the “CBP invoices” from 22 December 2025 to 26 February 2026, this is not the verification required by the Practice Note. I find this rather surprising given that the orders of 27 February 2026 specifically referred to the Practice Note in Order 5.

24    However, the matters required in Part B of Annexure A to the Practice Note have been substantially, but not wholly, complied with. The affidavit contains the total legal costs incurred by the first respondent to date, and an analysis of the hourly rates charged by the first respondent’s solicitors against the Federal Court Scale. Mr Russell sets out the total costs incurred in connection with the proceeding, comprising professional fees charged by the first respondent’s solicitors, and disbursements, including counsel’s fees for advice and appearance. He gave evidence that the retention of counsel was reasonable for this proceeding “in light of the long history of the matter and the potential complexities that arose and which are the subject of the 27 February 2026 judgment”, and confirmed that junior fee earners were utilised wherever possible throughout the proceeding. The majority of the legal work for the first respondent in this proceeding was performed by a solicitor at an hourly rate of $350 per hour.

25    Mr Russell deposed that the application for a lump-sum costs order was made to “avoid a protracted process for the assessment and recovery” of the first respondent’s costs, and noted that the first respondent’s recoverable costs were likely to exceed $20,000. The affidavit includes a table which calculated the difference in costs allowable under the Federal Court Scale, and the actual billed costs, demonstrating that the recoverable costs (permitted under the Federal Court Scale) were well in excess of the lump-sum costs order sought. The first respondent’s analysis of its “permitted recoverable costs” under the Federal Court Scale assists to some extent, although I am not strictly bound to apply any applicable scale of costs to the making of a lump-sum costs order (see Geneva Laboratories at [86(8)]).

26    This application should have been made in compliance with the requirements of the Practice Note. The purpose for this is set out in the Practice Note at cl 4.11:

The intention of the lump-sum costs procedure is to streamline and expedite the determination or resolution of the quantum of costs question and not to replicate the taxation process.

27    There is a clear public interest in a procedure that streamlines and expedites the notoriously difficult process of taxation of costs. As noted by McElwaine J in GGPG Pty Ltd (Receiver and Manager Appointed) v Golden Eagle Property Group Pty Ltd (No 3) [2026] FCA 297 at [11]:

… the procedure for taxing costs [was undertaken with] a firm eye upon the well-known but now antiquated work: L.L Oliver’s Law of Costs (Melbourne Law Book Co., 1960). We have moved on, at least in this Court. As correctly submitted for the applicant, the lump-sum assessment procedure must not morph into a taxation of costs by another means.

28    While the Practice Note has not been complied with, the information set out by Mr Russell in his affidavit for the first respondent takes a broad-brush approach which is consistent with the lump-sum costs assessment procedure “designed to reduce the minutiae of protracted disputation that is often a characteristic of the traditional process for taxing a bill of costs” (see GGPG at [11]). Despite that lack of strict compliance, I am satisfied that the first respondent should have its costs by way of a lump-sum costs order as sought. I am prepared, due to the thoroughness of the affidavit in support but for the compliance with the Practice Note, to waive that compliance pursuant to rr 1.32 and 1.34 of the Federal Court Rules. I am persuaded to make orders despite the lack of compliance with the Practice Note given that a taxation or assessment procedure would result in significant further costs (including to Mr Turner) and delay. In my view, dispensing with compliance with the Practice Note in these circumstances gives effect to the overarching purpose of the civil practice and procedure provisions as set out in s 37M of the FCA Act.

29    I am prepared in this instance to make a lump-sum costs order for $20,000 as sought by the first respondent.

Associate:

Dated:    17 April 2026

SCHEDULE OF PARTIES