Re South East Queensland Electricity Board v Australian Telecommunications Commission Qld G168 of 1987 Administrative Law [1989] FCA 15 (10 February 1989)

FEDERAL COURT OF AUSTRALIA

Re: THE SOUTH EAST QUEENSLAND ELECTRICITY BOARD
And: AUSTRALIAN TELECOMMUNICATIONS COMMISSION
QLD G168 of 1987
Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Pincus J.(1)

CATCHWORDS

Administrative Law - challenge to administrative decision - decision reversed - validity of original decision undecided - costs.

Practice - incomplete proceedings - agreement that liability for costs be decided without trial.

Federal Court Rules O.62 r.3

HEARING

BRISBANE
10:2:1989

Counsel for the applicant: Mr J.H. Byrne Q.C. with Mr

A.J.H. Morris

Solicitors for the applicant: Morris Fletcher and Cross

Counsel for the respondent: Mr M.E.J. Black Q.C. with
Dr. G.A. Flick

Solicitors for the respondent: Mallesons Stephen Jaques

ORDER

The applicant's costs of the proceedings, including reserved costs, be taxed and that 80% of the sum so fixed be paid by the respondent to the applicant.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

DECISION

This is an application for costs by the applicant mentioned above. The proceeding is one in which there has not been a final hearing, but the parties agree that I should deal with the whole question of costs. Neither side desires to be put to the trouble and expense of a trial, which would produce a result of no practical importance, except insofar as it might affect costs. The Court has power to make an order as to costs at this stage (O.62 r.3), but the Rules do not say how the discretion should be exercised, where there has been no trial.

2. The quantum of costs in issue is, it is said, very substantial. There have been a number of directions hearings, but most of those have been of a largely formal character. I infer that the costs have principally been incurred in respect of discovery, which seems to have given rise to a great deal of controversy between the parties, and in preparation for trial.

3. The applicant instituted the proceedings in September 1987 under the Administrative Decisions (Judicial Review) Act 1977. The decision challenged was made on 11 August 1987 and was one refusing the applicant's request that the applicant be authorised to maintain its PABX systems. Under the relevant legislation, such an authorisation was necessary to enable the applicant to maintain the systems; they are, of course, telephone systems in the applicant's premises, connected to the respondent's networks.

4. According to the allegations in the amended statement of claim filed on 15 October 1987, the respondent's decision of 11 August 1987 was an improper exercise of its statutory power in that it took into account irrelevant considerations, failed to take into account relevant considerations, exercised its discretionary power in accordance with policy, and also unreasonably - in the Wednesbury sense. Some of the flavour of the case may be given by mentioning the allegedly irrelevant considerations; they were, in summary, the attitude of the Australian Telecommunications Employees Association towards maintenance of PABX systems and the likelihood of industrial action if the applicant's request to the respondent to maintain the systems was granted.

5. It should be added that the Court made a certain interlocutory declaration by consent on 4 October 1988; the parties had intimated that the making of the declaration would assist in bringing the case to an end. The parties' consent to the declaration (the terms of which need not be here set out) was, however, given without any concession as to costs.

6. The parties both contend that the Court should not, in order to dispose of the application for costs, attempt to predict the likely outcome of the litigation, were it taken to a conclusion. It seems to me that in some cases where the result of litigation has become academic, the Court may not be able rationally to decide the issue of costs without attempting some such prediction.

7. The applicant says that it acted reasonably in commencing the proceedings, and the respondent that it acted reasonably in resisting them. In my opinion, both assertions are correct, and can hardly be seriously controverted.

8. The applicant contends, however, that it should follow from a finding in its favour on that question that it should prima facie have its costs of the incomplete proceedings. It relies, for that view, on a number of cases. One is R. v. Gold Coast City Council; Ex parte Raysun Pty Ltd (1971) QWN 13. That was an application for a writ of mandamus, the respondent having admittedly done, before the hearing, that which the prosecutor was seeking to have done. The reasons in which the Full Court of the Supreme Court of Queensland agreed include the following:

"In my view the prosecutor had reasonable ground for
complaint upon the attitude taken by the respondent
Council in its failure to consider the application
of the prosecutor ... and an arguable case to
support the issue of writs of mandamus up to that
point when the respondent Council by its servant
did consider such road and drainage plans and
specifications".

9. I read this as implying that the prosecutor seemed to the Court to have a reasonably good case. It appears that the matter had, before it was decided to foreshorten the proceedings, been argued at length before the Full Court and I infer that the Court had had an opportunity to form a prima facie view as to the merits. The Court appears to have gone further than merely finding that the prosecutor acted reasonably in commencing proceedings; that description may apply even where the Court decides, in the end, that there is no cause of action.

10. The second case relied on by the applicant in support of the proposition that it should have costs because it acted reasonably in commencing the proceedings is one of Ryan J., also in the Supreme Court of Queensland, (Liddle v. Kooralbyn Pty Limited, unreported 9 October 1987). I do not analyse the Court's reasons in that case at length, but, having read them, have formed the view that Ryan J. gave the plaintiff costs because it appeared that the defendant's conduct, prompting the bringing of proceedings against it, had been unlawful. The plaintiffs sued on the basis that the defendants sold land without according to the plaintiffs the first right of refusal to which the plaintiffs were contractually entitled, and there seems to have been no real dispute that they were so entitled.

11. The third decision relied on by the applicant for its proposition mentioned above was one of mine: James Richardson Corporation Pty Ltd v. Federal Airports Corporation (unreported, 23 May 1988). Although the reasons there made reference to the proceedings having been reasonably instituted, the problem was one of a kind different from the present.

12. Here, the respondent admittedly reversed the decision complained of, but it did so (so it was argued) because of a change in extrinsic circumstances; its reversal of the decision should not be taken to be an implicit admission that the original decision was unlawfully made. That point requires further elaboration.

13. The respondent's case is that it changed its policy about PABX systems "to accommodate an imminent change in the law", as a result of a statement by the then Minister for Transport and Communications issued on 25 May 1988.

14. The foreword to the Minister's statement describes it as explaining "in detail the consideration given by the Government to the complex set of issues involved in reshaping arrangements for the telecommunications services industry". The document goes on to say that the statement:

"... sets out the decisions we have taken to bring
about structural reform and the reasoning behind
those decisions".

As to PABX maintenance, the statement says in effect that there are advantages in opening PABX maintenance to competition and that a continued maintenance monopoly is unjustified.

15. The applicant's submission points out that it is not the Minister, nor the Federal Government as a whole, which has the relevant statutory power - that is, power to grant authorisation to maintain the applicant's PABX systems; that power is vested in the respondent.

16. While there can be no suggestion that the Minister's statement absolutely forced a reconsideration of the decision complained of in these proceedings, I think I should accept that, as a practical matter, the statement and the change in Government policy it reflected brought about the respondent's abandonment of its previous stance. This is to be distinguished both from the case in which a decision-maker just changes his mind, having reconsidered the facts, and the case where the decision-maker is obliged to reach a new and opposite conclusion by a change in external circumstances. In the former case, but not necessarily in the latter, I should think that the decision-maker would ordinarily pay the costs of incomplete proceedings of this kind; the present situation falls between the two categories just mentioned.

17. Apart from the matters already touched on in these reasons, the respondent urged upon me some other matters as relevant to the exercise of the discretion on costs. Of these, the most weighty is the suggestion that the applicant sought discovery on too wide a basis, causing an unnecessary expenditure of time and effort on the part of the respondent.

18. It does not appear to me practicable to take that assertion into account. If the applicant behaved, as to discovery, in a way meriting criticism, the respondent's proper course was to raise that issue by way of resistance to the wide discovery sought. More generally, I am of the view that consideration of the mode of conduct of proceedings by the parties - i.e. whether each behaved lawfully and reasonably with respect to questions of discovery and the like - provides no assistance, in this particular case, in determining who should pay the costs.

19. Although the parties have agreed that I should determine it on the submissions made to me, there is in my view no certain basis on which to determine the question of liability for costs. One possible solution is simply to make no order as to costs, on the ground that it is not perfectly clear which side, if either, should pay them.

20. As a matter of legal policy, however, that appears to be an unsatisfactory way of disposing of the matter; the Queensland decisions mentioned above, also, tend against it. The parties' submissions are at one in urging upon me the view that litigants should not be forced to go on, or discouraged from settling their differences, by an inability to resolve a dispute as to costs. I agree; if a piece of litigation has become academic, except as to the issue of costs, it appears that the Court should co-operate as far as it reasonably can, in disposing of the question of costs at the parties' request, without requiring a trial to determine who would have won.

21. Here, although the parties have submitted that I should not attempt to say who would have won at a trial, the applicant has placed submissions before me relevant to its claim that it acted reasonably in bringing the proceedings, and I have taken them into account in assessing its case. Those submissions, which rely largely upon documents discovered, have persuaded me that the applicant had, on the face of it, a fairly strong case - one more promising than that of the respondent. I have also taken into account against the respondent that the cause of the litigation's not having culminated in a trial was that the respondent changed its mind, albeit in the circumstances outlined above. It will be ordered that the applicant's costs of the proceedings, including reserved costs, be taxed and that 80% of the sum so fixed be paid by the respondent to the applicant.