4 Detailed submissions were received from both parties in relation to costs. There was substantial agreement in terms of the appropriate principles. In that regard, but with one exception, Vodafone accepted the following statement of principle to be found in the written submissions of Mobile:
· Costs are in the discretion of the Court which has full power to determine by whom and to what extent costs are to be paid: s76(1) Supreme Court Act 1970.
· The powers and discretions of the Court under s76 are to be exercised in accordance with SCR 52A: SCR 52A rule 4.
· If the Court makes an order as to costs, the Court shall order that costs follow the event except where it appears to the Court that some other order should be made as to the whole or any part of the costs: SCR 52A rule 11.
· Thus, the starting point is that plaintiff, having been successful, is entitled to its costs. It is for the defendants to establish a basis for departing from that rule.
· It is certainly the case that a successful party who has failed on certain issues may not only be deprived of their costs on those issues but may be ordered as well to pay the other party's costs of them Hughes v Western Australian Cricket Association Inc (1986) ATPR 40-748 at 48,136.
· Notwithstanding that the Court has power to deprive a successful party of costs, or even order a successful party to pay costs, that is a course to be taken in unusual cases and with a degree of hesitancy. For example:
(a) Cretazzo v Lombardi (1975) 13 SASR 4 at 16 (Jacobs J):
"But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. 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. ... 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 on his success in those particular issues."
(b) Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 (Gummow, French and Hill JJ):
"The propositions enunciated in [ Hughes ] are subject to the further consideration that justice may not be served if parties are dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case: Cretazzo ... at 12. In Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 3) (1979) 28 ALR 201, Fisher J regarded the discretion to apportion costs as one to be exercised only in the most exceptional circumstances. Nevertheless he accepted that where a considerable part of the trial is taken up in determining issues upon which a party fails, it is a proper exercise of the discretion to reduce the costs allowed to that party."
(c) Waters v PC Henderson (Aust) Pty Ltd (unreported, CA(NSW), Kirby, Mahoney and Priestley JJA, 40678/91, 6 July 1994) (per Mahoney JA):
"Where the proceedings involve multiple issues the application of the rule that costs follow the event may involve hardship where a party succeeds on some issues and yet fails on others. Particularly is this so where, for example, a defendant succeeds on issues that occupied the bulk of the time taken by the proceedings. Nevertheless unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those in which it failed."
(d) NRMA Ltd v Morgan (No 3) [1999] NSWSC 768 (Giles J):
"Principles according to which some other order may be made are fairly well established. If a party fails on some issues, the circumstances may make it reasonable that he be deprived of the costs of those issues, or even be ordered to pay the other party's costs of those issues. For this purpose, issues may be issues in a pleading sense of bases of claim, or may be disputed questions of fact or law. But it must be remembered that parties should not be dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case, and unless a particular issue or group of issues is clearly dominant or separable from the balance of the proceedings it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between the issues on which he was successful and those on which he failed. It is sufficient to refer to Cretazzo v Lombardi (1975) 13 SASR 4 at 12; Hughes v Western Australian Cricket Association (1986) ATPR 40-748 at 48,136; Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 271-2; and Waters v P C Henderson (Australia) Pty Ltd (NSWCA, 6 July 1994, unreported).
(e) Doric Products Pty Ltd v Lockwood Security Products Pty Ltd [2002] FCA 282 (Hely J):
"The courts have cautioned against too ready a resort to apportionment according to issue based outcomes. See, eg, Australian Trade Commission v Disktravel [2000] FCA 62. Justice may not be served if the parties are dissuaded by the risks of costs from canvassing all issues which might be material to the decision in the case: Cretazzo v Lombardi (1975) 13 SASR 4 at 16".
· A recent application of the principle was by Barrett J in LMI v Baulderstone (No.2) [2002] NSWSC 72. In that case two plainly discrete claims were made by the plaintiff - a minor claim upon which the plaintiff was successful and the dominant claim upon which the defendant succeeded. His Honour considered the claims "were so separate and disassociated (although involving common witnesses) that I think they should be treated, for costs purposes, as if they had been the subject of separate trials".
· Where the principle is applied it is generally not appropriate to order that costs be paid in respect of particular issues because "that would create a degree of artificiality, and would impose an extraordinarily difficult task upon any registrar faced with the need to tax costs, in default of agreement": Orion Pet Products Pty Ltd v Royal Society for the Prevention of Cruelty to Animals (Vic) Inc (No 2) [2002] FCA 967 (Weinberg J).
· Rather it is generally appropriate simply to apportion costs [SCR 52A rule 6(2)(a)] on the basis of "impression and evaluation: Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272; LMI at paragraph 36. Mathematical precision is not required and the court will not attempt to be too technical or exacting in seeking to allocate costs: Dodds Family Investments at 272; NRMA Ltd v Morgan (No 3) [1999] NSWSC 768 (Giles J) at paragraph 25; Madden as Official Liquidator of Aquanaut Constructions Pty Ltd (in liq) [2001] NSWSC 1051 (Hamilton J) at paragraph 3; Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20 at 22. Relevant factors include the relative time devoted to evidence and submissions on the competing issues: Hughes at 48-136; Waters at 5; Fexuto at 22-25; NRMA at paragraphs 31-47 and the relative success of the party in terms of its original claim: Abigroup v Peninsula (No 2) [2001] NSWSC 1016 (13 November 2001) at paragraphs 36-40; LMI at paragraphs 41-47.