Federal Court of Australia

Atkinson v Jeffery, in the matter of Atkinson (No 2) [2026] FCA 759

ORDERS

THE COURT ORDERS THAT:

1.    The applicant is to pay the respondents’ costs pursuant to Order 1 of the Orders made on 13 April 2026:

(a)    assessed on a party and party basis up to 24 October 2025 and thereafter assessed on the indemnity basis; and

(b)    fixed as a lump sum.

2.    The respondents are to file and serve an updated costs summary prepared in accordance with Costs Practice Note (GPN-Costs) at [4.10]-[4.12] and written submissions in support, not exceeding three pages in length, by 4 pm on 1 July 2026.

3.    The applicant is to file and serve a costs response prepared in accordance with GPN-Costs at [4.13]-[4.14] and written submissions in response, not exceeding three pages in length, by 4 pm on 15 July 2026.

4.    Determination of the lump sum amount of the costs be referred to a Registrar.

5.    The costs of determination of the lump sum amount be included in the lump sum.

6.    The surname of the first and second respondent be changed to “Jeffery”.

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

REASONS FOR JUDGMENT

MARKOVIC J:

1    On 13 April 2026 I made orders dismissing the amended application filed by the applicant, Nicole Deberoah Atkinson, with costs. In her amended application Ms Atkinson sought an order that a bankruptcy notice issued on 18 August 2025 and served on her should be set aside. At the time I also made orders for the respondents, Trevor Stanley Jeffery and Dina Lorraine Jeffery, to file and serve any submissions in support of an application for an order that their costs be assessed on a lump sum basis and, if such submissions were filed, for Ms Atkinson to file any submissions in response: see Atkinson v Jeffrey [2026] FCA 427.

2    Mr and Mrs Jeffery have filed submissions in accordance with those orders and Ms Atkinson has made submissions in response. As anticipated by Order 5 made on 13 April 2026 the question of whether the costs payable by Ms Atkinson to Mr and Mrs Jeffery should be assessed on a lump sum basis is to be determined on the papers. Neither party objects to me proceeding that way nor seeks an oral hearing.

3    In short, Mr and Mrs Jeffery submit that this is a case where costs should be assessed on a lump sum basis, that I should undertake the assessment of those costs on that basis and that those costs should be assessed notionally on the indemnity basis after 20 October 2025.

4    Ms Atkinson made the following brief submissions (as written):

1.    The costs of process of making a lump sum cats application should by its nature by relatively cheap as there can be no assurance that if an assessment was made the applying party may not be awarded costs.

2.    The claimed costs should be limited to what would have been claimed on a party/party basis and include only the work that was reasonable and a reasonable amount for that work, considering who actually performed the work and held primary responsibility for the proceedings.

3.    There should then be a reduction usualy of around 30% of the the costs which were reasonable and necessary and reasonable on a party/party basis.

5    Section 43 of the Federal Court of Australia Act 1976 (Cth) relevantly provides that the Court or a judge may award a party costs in a specified sum: s 43(3)(d). Rule 40.02(b) of the Federal Court Rules 2011 (Cth) provides that a party or a person entitled to costs may apply to the Court for an order that the costs be awarded in a lump sum.

6    The Court’s Costs Practice Note (GPN-Costs) applies to all proceedings and, among other things, addresses the topic of costs obtained by a lump sum costs order setting out in detail the procedure to be adopted by the parties where such an application is made.

7    The Court’s power to order lump sum costs is discretionary and may be exercised whenever the circumstances warrant it. In Fewin Pty Ltd v Burke (No 3) [2017] FCA 693, commencing at [11], I set out a summary of the principles relating to the circumstances in which the Court might make an order that costs be assessed on a lump sum basis including at [11]-[12]:

11    In Dunstan v Human Rights and Equal Opportunity Commission (No 3) [2006] FCA 916 Mansfield J set out some of the factors relevant to the exercise of the Court’s discretion to order lump sum costs pursuant to O 62 r 4(2)(c) of the former Federal Court Rules at [23]-[24] as follows:

23    There is no particular characteristic of a case which must exist before a gross sum costs order can be made: Australasian Performing Rights Association Ltd v Marlin [1999] FCA 1006. It is a power which may be exercised whenever the particular circumstances of the case warrant it: Beach Petroleum NL v Johnson (1995) 57 FCR 119 (Beach); Harrison v Schipp (2002) 54 NSWLR 738.

24    Factors which have been considered when exercising the discretion to make such an order include –

•    where the delay, expense and inconvenience of taxing costs in the normal manner would be unduly protracted or unduly expensive: Beach at 120; Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629 (Charlick); Foyster v Foyster Holdings (2003) 44 ACSR 705; and

•    where the financial capacity of the party liable to pay costs is such that the additional cost of taxation will impose a significant burden on the party in whose favour costs are ordered without real prospects of recovering those costs: Hadid v Lenfest Communications Inc [2000] FCA 628; Sparnon v Apand Pty Ltd (unreported, von Doussa J, 4 March 1998); Sony Entertainment (Australia) Ltd v Smith (2005) ALR 788.

…

12    The Court has also recognised that it is appropriate to use the lump sum costs order procedure in cases which are simple and in which “there would be utility in the [C]ourt cutting the Gordian knot of protracted fights about costs”: Keen v Telstra Corporation Limited (No 2) [2006] FCA 930 at [6] (per Rares J). In that case, Rares J also observed that the purpose of a lump sum costs order is to save the parties the time, trouble, delay, expense and aggravation in having to proceed to a taxation of costs.

8    In my view, the assessment of costs on a lump sum basis is appropriate in this case. Ms Atkinson does not seem to oppose that course. Her brief submissions engage more with the process to be adopted once an order is made for costs to be assessed on a lump sum basis than with the question of whether costs should be assessed on that basis, as an alternative to taxation.

9    I accept Mr and Mr Jeffery’s submission that the assessment of costs should be undertaken in a procedurally efficient and simple way. The “Gordian knot” should be cut and the litigation, which has concerned costs between the parties, should end. It will be in the interests of the parties and consistent with s 37M of the Federal Court Act to assess costs on a lump sum basis in this proceeding. The parties ought not be involved in a protracted taxation or dispute about costs.

10    Mr and Mrs Jeffery raise two further matters.

11    First, Mr and Mrs Jeffery say it is appropriate that costs be fixed on the basis that they are to have their costs on the indemnity basis after they made their open offer to Ms Atkinson by letter dated 20 October 2025 (20 October Letter). In the 20 October Letter Mr and Mrs Jeffery offered to: withdraw the bankruptcy notice, seek no costs (of this proceeding), defer enforcing their judgment (on which the bankruptcy notice was based) for a period of 42 days in exchange for security, namely a charge over Ms Atkinson’s property, after which, if the judgment was not satisfied, they would expect to enforce their security and to recover the judgment sum by that method. The 20 October Letter set out the rationale for the offer and the basis upon which Mr and Mrs Jeffery said that it would be unreasonable for Ms Atkinson to refuse it.

12    Relevantly the 20 October Letter concluded in the following way:

If your client refuses to accept the above proposal, and continues the Federal Court Proceedings then,

…

(b)    In the event that (as can be expected) your client fails to succeed in her application to set aside our clients’ bankruptcy notice, then our clients will rely upon her refusal to accept the above proposal as a basis for seeking the costs of the proceeding from your client on the indemnity basis, consistent with the principles of Calderbank v Calderbank [1976] Fam 93.

13    A response to the 20 October 2025 Letter was sought by 24 October 2025. No response was included in the evidence before me and, given that the hearing proceeded, it is clear that the offer was not accepted.

14    Mr and Mrs Jeffery submit that Ms Atkinson clearly obtained a less favourable outcome to the offer contained in the 20 October Letter and that I would find that it was unreasonable for her to have refused the offer, with the proceeding seemingly having been pursued solely in the hope of obtaining costs orders.

15    The offer in the 20 October Letter was expressed to be made pursuant to the principles in Calderbank v Calderbank [1976] Fam 93.

16    The outcome of the proceeding was, as set out above, that Ms Atkinson’s application to set aside the bankruptcy notice was dismissed. Unless Ms Atkinson has paid the amount sought in the bankruptcy notice, it is open to Mr and Mrs Jeffery to file and proceed with a creditor’s petition.

17    Despite the complexity of Mr and Mrs Jeffery’s offer, I accept that, on analysis, the outcome of the proceeding is clearly less favourable to Ms Atkinson than the offer made in the 20 October Letter by which: the bankruptcy notice was to be satisfied by the grant of security; this proceeding was to be dismissed with no order as to costs; Ms Atkinson was to be given time to pay the judgment sum which was the subject of the bankruptcy notice; and, only in the event that she did not do so, Mr and Mrs Jeffery were entitled to enforce the security granted by Ms Atkinson in order to secure its payment. Put another way, in the circumstances and in the absence of any evidence from Ms Atkinson to the contrary or explaining why she did not accept the offer, I am satisfied that it was unreasonable for Ms Atkinson to have, in effect, rejected the offer in 20 October Letter.

18    In those circumstances I am satisfied that Mr and Mrs Jeffery should have their costs on an indemnity basis from 24 October 2025 (rather than 20 October as sought) which was the date by which they sought a response to the offer in the 20 October Letter.

19    The second matter raised by Mr and Mrs Jeffery is that any lump sum costs order be fixed by me rather than by a Registrar. While Mr and Mrs Jeffery accept that this will be an imposition upon the Court’s limited time, they submit that to do so will aid in the inherently impressionistic fixing of a lump sum by ensuring that the costs are fixed by a person familiar with the matter and will ensure that the matter is bought to an end. They note the referral to a Registrar is liable not to achieve that end given any decision made could be reviewed de novo as of right.

20    I accept that I have a familiarity with the proceeding that a Registrar, coming to the question of assessment of the costs on a lump sum basis afresh, would not have. I also accept that if I carry out the task of assessing costs on a lump sum basis that will, subject to any appeal, bring the matter to some finality. However, the resources of the Court are scarce and are to be deployed in a manner that most efficiently serves the interests of justice and of the many parties that come to the Court for the resolution of their disputes. The Registrars of the Court assist in the quick, inexpensive and efficient disposition of the Court’s work. Moreover, they are skilled in managing claims for costs and assessing costs whether ordered to be paid on a lump sum basis or otherwise. I will refer the assessment of Mr and Mrs Jeffery’s costs to be carried out on a lump sum basis and to be notionally assessed on the indemnity basis from 24 October 2025 to a Registrar.

21    I will make orders in accordance with these reasons and, in order to facilitate the assessment of their costs, an order that Mr and Mrs Jeffery file their updated costs summary as required by GPN-Costs and submissions in support, not exceeding three pages in length, within 14 days from the date of publication of these reasons and that Ms Atkinson file and serve her costs response as required by GPN-Costs and her submissions, not exceeding three pages in length, within 14 days thereafter.

22    Finally, Mr and Mrs Jeffery’s surname has been misspelled in Ms Atkinson’s amended application and on the Court file. I will make an order that the title of the proceeding be amended to reflect the correct spelling.

Associate:

Dated:    17 June 2026