Australian Trade Commission v Disktravel [2000] FCA 62 (11 February 2000)

Last Updated: 15 February 2000

FEDERAL COURT OF AUSTRALIA

Australian Trade Commission v Disktravel [2000] FCA 62

COSTS - appeal - appellant successful on one issue not successful on others - apportionment of costs - discretion - costs follow event.

Federal Court of Australia Act 1976 (Cth) s 43(2)

Hughes v Western Australian Cricket Association (Inc) (1986) ATPR 48,134 applied

Cretazzo v Lombardi (1975) 13 SASR 4 applied

Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 3) (1979) 42 FLR 213 cited

Inn Leisure Industries Pty Ltd (Provisional Liquidator Appointed) v D F McCloy Pty Ltd (No 2) (1991) 28 FCR 172 cited

AUSTRALIAN TRADE COMMISSION v DISKTRAVEL, JOHN GAETANO MARIO FIOCCO, DIVOT PTY LTD, HOLDEN BARLOW and CECK INVESTMENTS

W 19 of 1999

FRENCH, KIEFEL AND MANSFIELD JJ

11 FEBRUARY 2000

PERTH

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY	W 19 OF 1999

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	AUSTRALIAN TRADE COMMISSION Appellant
AND:	DISKTRAVEL First Respondent JOHN GAETANO MARIO FIOCCO Second Respondent DIVOT PTY LTD Third Respondent HOLDEN BARLOW Fourth Respondent CECK INVESTMENTS Fifth Respondent
JUDGE:	FRENCH, KIEFEL AND MANSFIELD JJ
DATE OF ORDER:	11 FEBRUARY 2000
WHERE MADE:	PERTH

THE COURT ORDERS THAT:

1. The Respondents to pay the Appellant's costs of the proceedings before the Learned Primary Judge.

2. The orders made on 22 October 1999 are not otherwise varied.

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

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY	W 19 OF 1999

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	AUSTRALIAN TRADE COMMISSION Appellant
AND:	DISKTRAVEL First Respondent JOHN GAETANO MARIO FIOCCO Second Respondent DIVOT PTY LTD Third Respondent HOLDEN BARLOW Fourth Respondent CECK INVESTMENTS Fifth Respondent

JUDGE:	FRENCH, KIEFEL AND MANSFIELD JJ
DATE:	11 FEBRUARY 2000
PLACE:	PERTH

REASONS FOR JUDGMENT ON QUESTION OF COSTS

THE COURT:

1 On 22 October 1999, the Court gave judgment in this matter making the following orders:

"1. The appeal is allowed.

2. The decision of the Learned Primary Judge of 5 February 1999 be set aside and that of the Administrative Appeals Tribunal be set aside in so far as it relates to the respondents to this appeal.

3. The decision of the appellant notified on 25 October 1996 that each of the respondents to the appeal is "not eligible for a grant under the Export Market Development Grants Act 1974 (Cth) in respect of the claim year 1994-95" be affirmed.

4. The respondents to pay the appellant's costs of the appeal.

5. Liberty to the Respondents to apply by written submission within 14 days to vary the costs order.

6. The Appellant to file any reply to any such submission within 14 days of the Respondents' submission."

2 Written submissions have been received in relation to the question of costs pursuant to the liberty reserved by the Court's order. The twelve grounds of appeal in the end raised three substantive issues for determination. They were:

1. Did the Tribunal err in its approach to determining the primary and principal purpose of the claimed qualifying export development expenditure (Grounds 2, 3 and 4)?

2. Were there eligible industrial property rights owned by the respondents (Ground 5) and did the claimed expenditure relate to their disposal (Grounds 6 and 6A)?

3. Did s 38 of the Export Markets Development Grant Act apply in this case (Grounds 7 to 12)?

On the first issue, the appellant did not succeed. That was the view of all of the Judges of the Full Court. On the second issue, all Judges found the appellant to have succeeded in that there were no eligible industrial property rights owned by the respondents. Having regard to the conclusion of the Court in relation to the second issue, it was not strictly necessary to determine the third, relating to s 38. Nevertheless for reasons given by Kiefel J, with which Mansfield J agreed, their Honours held that s 38 would not have applied to the arrangements in issue and in that respect found against the appellant.

3 The Court has a general discretion under s 43(2) of the Federal Court of Australia Act 1976 (Cth) to award costs. It is a discretion which must be exercised judicially. In Hughes v Western Australian Cricket Association (Inc) (1986) ATPR 48,134 at 48,136, Toohey J summarised the effect of decisions of Australian and English Courts on apportionment of costs thus:

1. Ordinarily, costs follow the event and a successful litigant receives costs in the absence of special circumstances justifying some other order.

2. Where a litigant has succeeded only upon a portion of the claim, the circumstances may make it reasonable that the litigant bear the expense of litigating that portion upon which it has failed.

3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs. Issue in that sense does not mean a precise issue in the technical pleading sense but any disputed question of fact or law.

There is also to be considered as a caveat against too ready a resort to apportionment according to issue based outcomes, the observations of Jacobs J in Cretazzo v Lombardi (1975) 13 SASR 4 at 15:

"The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including, in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely upon his success in those particular issues."

See also Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 3) (1979) 42 FLR 213 and Inn Leisure Industries Pty Ltd (Provisional Liquidator Appointed) v D F McCloy Pty Ltd (No 2) (1991) 28 FCR 172.

4 In our opinion this is not a case which merits apportionment of costs. The appellant succeeded completely in terms of the final orders it secured. The issues it raised in argument on the appeal were not unreasonably raised. The somewhat complex factual background was a matter which had to be considered in relation to all issues. None of the issues raised can be characterised in terms of the time and work involved as distinct and severable from the other issues to the extent that an apportionment would be warranted.

5 The judgment as to apportionment is in the end an evaluative one and in the view of the Court there is no reason why in this case the costs should not follow the event. We should add that it should also be ordered that the respondents' pay the appellant's costs before the Judge at first instance.

I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.

Associate:

Dated: 11 February 2000

Counsel for the Appellant:	Mr A Robertson SC and Mr P Macliver
Solicitor for the Appellant:	Australian Government Solicitor
Counsel for the Respondents:	Mr CJL Pullin QC and Mr R G Castledine
Solicitor for the Respondents:	Minter Ellison
Date of Judgment:	11 February 2000