Costs
143 No party in this proceeding sought costs against the TSRA at the CMH on 18 December 2017. However, I consider that it is appropriate for the Court to consider, on its own motion, whether costs should be awarded in respect of a hearing that should not have needed to take place.
144 Section 85A of the Native Title Act provides:
85A Costs
(1) Unless the Federal Court orders otherwise, each party to a proceeding must bear his or her own costs.
Unreasonable conduct
(2) Without limiting the Court's power to make orders under subsection (1), if the Federal Court is satisfied that a party to a proceeding has, by any unreasonable act or omission, caused another party to incur costs in connection with the institution or conduct of the proceeding, the Court may order the first‑mentioned party to pay some or all of those costs.
145 In an interlocutory decision in the Part A aspect of this proceeding, Greenwood J considered (somewhat ironically) an application by the TSRA for costs: Akiba v Queensland [2010] FCA 321; 184 FCR 406. Given that this proceeding arises from an application made under s 61 of the Native Title Act, and for the reasons given by his Honour in those proceedings (see in particular, [32]-[60]), it is clear that s 85A applies to this proceeding, notwithstanding that the Court is considering costs orders at an interlocutory stage of the proceeding.
146 The operation of s 85A is well-established by the authorities. In Akiba [2010] FCA 321; 184 FCR 406, Greenwood J said at [61]:
Section 85A operates to remove any ground of expectation that unless 'cause' is shown for some other order to be made, costs will usually follow the event in accordance with settled principle guiding the exercise of discretion to award costs under general statutory provisions conferring such a power: Ward v Western Australia (No 2) (1999) 93 FCR 305 at [33] per Lee J; Davidson v Fesl (No 2) [2005] FCAFC 274 at [9] per French and Finn JJ. As Lee J observed in Ward 93 FCR 305 at [34], the discretion of the Court under s 85A to award costs is 'not confined'. The matters to be taken into consideration in making a costs order are left by s 85A to the Court as a 'discretion to be exercised judicially'. However, the starting point is that each party 'must bear his or her own costs' (the language of s 85(1)) unless the Court determines that it is appropriate in all the circumstances to make an order for costs. The circumstances informing whether the Court will do so are not confined to unreasonable acts or omissions on the part of a party sought to be burdened with a costs order. Plainly enough, one express basis upon which the Court may order a party to bear costs is that the party has engaged in unreasonable conduct within s 85A(2) of the Act.
147 In De Rose v State of South Australia (No 2) [2005] FCAFC 137, the Full Court (Wilcox, Sackville and Merkel JJ) endorsed what Lee J said in Ward v Western Australia (1999) 93 FCR 305, at [8]:
• Nonetheless, s 85A acknowledges that the Court has an overriding discretion as to costs and does not expressly impose a limit on the scope of the discretion (at [31]-[32]).
• There is no requirement that a threshold condition be met before the Court is empowered to make a costs order. It follows that the exercise of the discretion is not conditional upon a finding of fact or the formation of an opinion as to the occurrence of unreasonable conduct or the existence of special circumstances (at [35]).
• Section 85A(2) of the NT Act puts beyond doubt the extent of the Court's discretion in cases where a party acts unreasonably, but s 85A(2) does not control or limit the discretion available to the Court under s 85A(1) (at [36]-[37]).
• The matters to be taken into account in making a costs order are left to the Court's discretion, which must be exercised judicially. However, the starting point is that each party will bear their own costs unless the Court determines that it is appropriate in the circumstances to make an order for costs (at [34]).
148 Similarly, in Cheedy v Western Australia (No 2) [2011] FCAFC 163; 199 FCR 23, the Full Court (North, Mansfield and Gilmour JJ) stated at [9]:
It is now well established that in proceedings to which s 85A applies:
(1) s 85A(1) removes the expectation that costs will follow the event, but the Court retains its discretion as to costs under s 43 of the FCA Act;
(2) the "unreasonable conduct" of the parties is not a jurisdictional fact which pre-conditions the exercise of the discretion, and on the other hand, s 85A(2) does not control or limit the discretion in s 85A(1);
(3) whilst the exercise of the discretion when making a costs order should be judicial, the starting point is that each party will bear its own costs; and
(4) it is not proper to use the power to award costs to punish either a successful or an unsuccessful party or as a deterrent to other would-be applicants: Reid v South Australia [2007] FCA 1479 at [54].
149 Whether conduct in a given case can be said to be "unreasonable" depends on the circumstances of each case. Conduct has been held to be unreasonable in the preservation of evidence stage of a proceeding, in circumstances where an applicant prepared five lists identifying people whose evidence may need to be preserved, none of which on final consideration produced a single person whom it wished to call: Birri-Gubba (Cape Upstart) People v State of Queensland [2008] FCA 659. More fundamentally, conduct has been held to be unreasonable where a respondent filed a notice of intention to participate and a response to the applicant's statement of issues, facts and contentions and thus became the only party to challenge the applicant's case on connection, in circumstances where the State and other respondent parties had agreed in principle to a consent determination, and where, after filing the response, it substituted a further amended notice and amended substituted response without any proper explanation: Watson v State of Western Australia (No 3) [2014] FCA 127, upheld on appeal (Oil Basins Limited v Watson [2014] FCAFC 154).
150 In contrast, conduct which was "benign, although equally unfortunate" as compared to the conduct in Watson, has been held not to be unreasonable in circumstances where the State withdrew an admission late in the proceeding which resulted in the claimants withdrawing their compensation claim: Ward v State of Western Australia (No 4) [2016] FCA 358.
151 I gave Mr Besley, who appeared on behalf of the TSRA at the 18 December CMH, an opportunity to make submissions about whether any costs orders should be made. He indicated he had anticipated such a situation, and had prepared submissions. Mr Besley, accepted that Lee J's decision in Ward (1999) 93 FCR 305, as endorsed by the Full Court in De Rose, is authoritative in relation to the operation of s 85A. Mr Besley accepted that unreasonableness was one factor relevant to a consideration under s 85A, and referred to Quandamooka People #1 v State of Queensland [2002] FCA 259 for that proposition. Mr Besley submitted that in this case, the TSRA's conduct concerning funding was not unreasonable, primarily for two reasons. The first is that the TSRA provided a substantive response to the funding application made by Mr Gilkerson on behalf of his clients within two weeks after the notice of acting was filed. In making this submission, Mr Besley conceded that some of his client's conduct in relation to responding to requests for funding has been "difficult to understand". The second reason is that the reason Dillon Bowers Lawyers received a response within a mere 28 minutes to their first interim request for funding was because Dillon Bowers had provided a cost agreement with a clear and finite work program. In relation to the amount offered of $81,000, Mr Besley said that this was a "reasonable starting point" on the basis that the work required to be done was essentially straightforward, unlike work required to amend a claim group or claim group area. According to Mr Besley, "it is simply a matter of deciding who the claim group wishes to choose to replace Mr Akiba".
152 I do not accept those submissions. As the narrative I have set out earlier makes clear, the TSRA well knew Mr Gilkerson was acting for the three claim group member respondents from 22 November 2017 and its Senior Counsel indicated to the Court that a funding decision would be made by the TSRA. The TSRA well knew the involvement of Gilkerson Legal in this proceeding until October 2017. Why the TSRA did not welcome the only lawyers with substantial continuity and experience in this proceeding, and constructive connections with the claim group, back into its conduct is also unfathomable. Service of a notice of acting need not have been a condition precedent to a funding decision. Second, the "work program" was set out in the Court's orders, which the TSRA was well aware of.
153 Mr Besley did not make the point made by counsel for the State, to which I refer below at [171]. He did not submit the Court could not, or should not make orders against the TSRA because it had a limited role as a respondent in this proceeding. As the evidence shows, Mr Besley is one of the lawyers, along with counsel he has briefed, who has been involved with the TSRA in a series of steps and events that are best characterised as the TSRA engaging in activities aligned with, if anything, its role as a native title representative body. Alternatively, he may have consciously chosen not to make this submission, given what he set out in a letter to Gilkerson Legal dated 8 August 2017 and sent in accordance with comments made by Greenwood J at a case management hearing on 28 July 2017. That letter is set out in an affidavit of Mr Gilkerson dated 12 October 2017, and sets out the reasons the TSRA should remain as a respondent in this proceeding: see [156] below. Sooner rather than later, there will need to be better clarity around the TSRA's role in this proceeding. If, as Mr Besley has stated, the TSRA contends it has a role as a respondent because it is a representative body, then its obstructionism and delays in that role, apparent from the evidence to which I refer, may well justify a cost order against it. However, for the reasons I have outlined, at present I do not consider there is a sufficient basis for a costs order, without knowing what the motivations of those within the TSRA are for the instructions that have apparently been given. I give Mr Besley the benefit of the doubt and do not attribute to his oral submissions any concession that costs could be ordered against his client, but rather that he sought to focus on the substance of his client's conduct.
154 The circumstances in this case are such that I consider the TSRA's conduct to have been unreasonable even though, as the authorities make clear, that is not a threshold, or a jurisdictional fact which must be made out before the Court's discretion on costs can be exercised. The narrative I have set out above at [24]-[106] amply demonstrates the many ways in which the TSRA has done little but run interference with attempts by the legal representatives of the three claim group members, and by Mr Akiba's lawyers, to get the large organisational process of authorisation underway.
155 Under s 203B of the Native Title Act, the TSRA, as a native title representative body, has six main functions:
the facilitation and assistance functions referred to in section 203BB;
the certification functions referred to in section 203BE;
the dispute resolution functions referred to in section 203BF;
the notification functions referred to in section 203BG;
the agreement making function referred to in section 203BH; and
the internal review functions referred to in section 203BI.
156 The TSRA is well aware of these functions. So much is clear from the letter sent by Mr Ted Besley, its legal representative, to Ms Cartledge of Gilkerson Legal, then the applicant's legal representative, on 8 August 2017. That correspondence is annexure OREG-1 to the affidavit of Mr Gilkerson, filed on 12 October 2017. It is instructive to extract Mr Besley's description of the TSRA's functions:
As you would be aware, the NTA confers certain functions, powers and obligations (collectively, 'functions') upon the TSRA as a representative body. Those functions which may be exercised with respect to these proceedings include:-
a) Facilitation and assistance functions when requested to do so (s 203BB). In performing these functions, the TSRA is required, among other things, to:
I. assist registered native title bodies corporate, native title holders and persons who may hold native title in consultations, mediations, negotiations and proceedings relating to native title applications (s 203BB(1)(B)); and
II. consult with, and have regard to the interests of, any registered native title bodies corporate, native title holders or persons who may hold native title who are affected by the matter (s 203BC(1)(a));
b) Dispute resolution functions (s 203BF). The dispute resolution functions of the TSRA include:
I. assisting in promoting agreement between its constituents (which include a native title holder in relation to native title in that area or a person who may hold native title in that area) about the conduct of consultations, mediations, negotiations or proceedings about native title applications (s 203BF(1)(a)(iii)); and
II. mediating between its constituents about the making of native title determination applications or the conduct of such consultations, mediations, negotiations or proceedings (s 203BF(1)(b));
c) Notification functions (s 203BG). The notification functions of the TSRA include:
I. ensuring that, as far as is reasonably practicable, notices that are given to the TSRA (whether under the NTA or otherwise) and that relate to land or waters partly or wholly within the area for which it is the representative body are brought to the attention of any person whom the TSRA is aware holds or may hold native title in relation to the land or waters, where the TSRA considers that the notices would be unlikely to come to the attention of the person by some other means (s 203BG(a)); and
II. as far as reasonably practicable, to identify and notify other persons who hold or may hold native title in relation to the land or waters about notices of the kind above (s 203BG(b)); and
d) other functions, which include:
I. as far as is reasonably practicable, to identify persons who may hold native title in the area for which the TSRA is the representative body (s 203BJ(b)); and
II. as far as is reasonably practicable, to inform the registered native title bodies corporate, native title holders and persons who may hold native title in so far as the TSRA knows, in relation to the area for which the TSRA is the representative body, of any matter the TSRA considers may relate to, or may have an impact upon native title in the area (s 203BJ(d)).
Further, while the TSRA must from time to time determine the priorities it will give to performing its functions and may allocate its resources in the way it thinks fit so as to be able to perform its functions effectively, it must give priority to the protection of the interests of native title holders (s 203B(4)).
157 The last paragraph of Mr Besley's letter is worth emphasising. As a representative body, it must give priority to the protection of the interests of native title holders and claimants: in this proceeding, the only parties who are representatives of the claim group are Mr David, Mr Nona and Ms Kanai. In deciding to fund 14 (and perhaps more) barristers and solicitors since the beginning of this year, for itself, the applicant and Mr Duncan in this proceeding, while delaying and obstructing the funding of Mr David, Mr Nona and Ms Kanai, the TSRA is clearly not giving priority to the protection of the interests of native title holders and claimants.
158 In delaying the provision of funding, on bases which range from the spurious, to the technical, to the downright inconsistent, the TSRA has failed at a fundamental level to give priority to the protection of the interests of claim group members. Indeed, its conduct has jeopardised compliance with a carefully worked out scheme to regularise this proceeding: an outcome which is the principal mechanism to advance the interests of the native title claim group.
159 The TSRA has engaged in constant, and ongoing, delaying tactics in stalling the decision-making process in relation to funding. It has also sought to undermine the role of the three claim group member respondents, and the applicant's cooperation with them, that was so obviously envisaged by all parties and by the Court at the end of the Thursday Island CMH.
160 Whatever officer holders or employees within the TSRA seek to achieve by this, one achievement that is undisputed is that the TSRA's conduct has occasioned not only unjustifiable delay, but significant costs in all concerned, costs which could have been put towards getting the authorisation process underway. The level of correspondence that has been necessary for Mr Gilkerson, when compared with the straightforward path delivered to Mr Dillon, is one example.
161 All this in a context where Senior Counsel for the TSRA informed the Court on 22 November 2017 on the last day of the Thursday Island CMH that his client was aware of the funding request by Mr Gilkerson, or a forthcoming funding request, by lunchtime on 22 November 2017.
162 These delaying tactics are exemplified by:
(1) At least by 28 November 2017, the TSRA was made aware by correspondence that Mr Gilkerson was acting for Mr David, Mr Nona and Ms Kanai, and that a funding request was being made by Mr Gilkerson on behalf of his clients: see [32] above.
(2) On 30 November 2017, the TSRA noted only that Mr Gilkerson "intend[ed]" to represent the indigenous claim group respondents, but that, as it had not received a formal notice of acting, it considered it "premature to address the request for funding for legal representation in the proceeding": see [33] above. Given the circumstances where Mr Gilkerson had expressly informed the CEO of the TSRA that he acted for Mr David, Mr Nona and Ms Kanai, it is unclear why a formal notice of acting was required to be served before a request for funding was addressed. A notice of acting is a Court process: it has nothing to do with the point at which a client retains a lawyer.
(3) Between 7 December and 14 December 2017, the TSRA sought further details before it considered it could assess the funding request:
(a) On 7 December, the TSRA said it needed a cost agreement, an outline of services, details as to the lawyers who would perform the work, and a description of tasks: see [40] above.
(b) On 10 December, the TSRA said it needed to know the manner in which Mr Gilkerson proposed to conduct the authorisation process and whether Mr Gilkerson would be conducting information sessions: see [41].
(c) On the same day, the TSRA said that it had to make decisions regarding assistance applications by reference to five general procurement policies issued by various Commonwealth departments: see [43]. As I said at [44] above, none of these policies would appear on their face to have any relevance to the assessment of a s 203BB funding request, which concerns the funding of legal costs for services provided by Mr Gilkerson to his indigenous claim group respondent clients, not to the TSRA.
(d) After the provision of a third party payer costs agreement by Mr Gilkerson on 12 December 2017, the TSRA said on 13 December that that was not the correct document, on the basis that it required a "signed Costs Agreement with your clients": see [73]. This would appear to be a misunderstanding, whether deliberate or otherwise, by the TSRA as to whether it or the indigenous claim group respondents should be executing such an agreement. I observe that the TSRA made no similar demand of Dillon Bowers in relation to their first cost agreement.
(e) The TSRA then sought clarification on Mr Gilkerson's client's interests, in order to consider whether the fact that Ms Cartledge of Gilkerson Lawyers previously represented the applicant would give rise to a conflict of interest: see [74] above.
(4) On 15 December, the TSRA sent two conflicting letters, the first to suggest that a funding decision would not be made until a board meeting was convened due to the desire of the indigenous claim group respondents to engage GBK in the provision of services in the lead-up to the authorisation process, and second, to suggest that notwithstanding the first letter, funds of up to $81,000 would be approved jointly for the applicant and the indigenous claim group respondents. These two letters have added considerable confusion to the funding process and the requirements of the TSRA, and I consider it adds to the unreasonableness of the conduct already discussed.
163 The unreasonableness of the TSRA's conduct set out in each of the paragraphs above is made all the more striking when contrasted with its conduct in relation to the funding request made by Dillon Bowers Lawyers. Mr Dillon was not asked whether and how he might be involved in the authorisation process, despite the fact that he represented the applicant, who must necessarily be involved in the process (if only so he could be removed as the applicant). He was not referred to any of the general procurement policies which the TSRA asserted were relevant considerations to any funding request. He was not asked to provide a cost agreement signed by Mr Akiba. The interim cost agreement was approved in 28 minutes.
164 In relation to para (3)(e) of [162] above, I consider this concern over the conflict of interest disingenuous for two reasons: first, the TSRA has been aware from the outset that Ms Cartledge was previously on the record for the applicant - indeed, the TSRA had previously provided funding for that purpose. It is not clear why, given the request for funding was clearly made from at least 28 November 2017, the question concerning a possible conflict of interest was only asked more than two weeks later, after a large amount of correspondence and a case management conference.
165 Second, the TSRA has been heavily involved in this proceeding, at least since May of this year, when it directed the applicant's experts to stop work. It could not seriously suggest that it was not aware of the relationship between the interests of the applicant and the three claim group respondents, who are each PBC Chairs and key figures in this proceeding. If it were to be contended that the TSRA, through Mr Farrell, is acting in its native title representative body capacity, and not as a respondent to this proceeding, and therefore that Mr Farrell is not aware of the circumstances of this proceeding and the interests of the various indigenous parties, such a contention would be untenable.
166 Although Mr Farrell is not a solicitor on the record for the TSRA, it is clear from documents filed before the Court that Mr Farrell has personally been involved in this proceeding. As part of the TSRA's interlocutory application to change the venue of the Thursday Island CMH, Mr Farrell travelled to Mer with Cecilia O'Brien for the purposes of conducting a meeting with Mer elders in relation to "the past conduct of Sea Claim A" and the proposed change of venue to Mer: see [12] of the affidavit of Ms O'Brien sworn 7 November 2017. He was copied into a series of correspondence on this issue, as can be seen from the correspondence annexed to Ms O'Brien's affidavit. In addition to this, he has been giving instructions to Mr Besley of Just Us Lawyers, who is on the record as the solicitor acting for the TSRA in this proceeding. So much is clear from the covering email to the letter I extracted at [39]. That covering email said "Please find attached correspondence in relation to the above matter sent you in Mr Farrell's absence…"
167 The mixed roles of Mr Farrell in this proceeding do not rise to the same levels as those of Ms O'Brien, although it might be said that the circumstances detailed at [166] may give rise to such concerns. For the moment, I make these observations only to say that the TSRA's apparent lack of knowledge of the claim group member respondents' interests is disingenuous.
168 The only reason this CMH was required was because of the TSRA's unreasonable conduct in delaying the making of the funding decision for the three claim group respondents' legal representative, and the resulting lack of progress towards an authorisation process. There is no other reason for this CMH.
169 Further, in order to explain the position to the Court, Mr Gilkerson and Mr Dillon have had to spend what was obviously a large amount of time preparing affidavit material, including, in the case of Mr Gilkerson, secondary affidavit material because the TSRA continued to go backwards and forwards about funding.
170 The time and resources of each of the active parties, and of the Court, has been wasted because of the TSRA's obstructionist attitude and that cannot be ignored.
171 Nevertheless, it is true, as counsel for the State submitted, that the conduct which I have set out in detail in these reasons, is conduct of officers within the TSRA who purport to discharge the TSRA's functions as a native title representative body, not as a respondent to this proceeding. As I have also set out, those functions have become mixed at times, and the personnel within the TSRA (and its external legal advisers) seem to move between the two roles without any consciousness of the potential conflicts in doing so. But that is not reason for the Court to add to the mixing and conflict, at least not without a firm foundation in evidence before it that there is no separate "respondent" function in reality.
172 The TSRA's conduct as an objectively minor respondent to this proceeding has caused difficulties, including at the Thursday Island CMH where there was a level of obstruction from the TSRA in that respondent role. However, since that time on the current evidence it has mostly been the TSRA's purported performance of its native title representative body functions which have caused the major disruption and interference. Not only in funding, but also by calling unilaterally a claim group meeting in Cairns, and in seeking Senior Counsel's advice on authorisation - for what purpose is unclear. For example, the TSRA could have briefed Senior Counsel to provide an advice on authorisation to the applicant and the three claim group member respondents, having consulted with them.
173 It should also be apparent from these reasons that the nature of the TSRA's conduct gives the Court cause to search for a rational explanation for the way it is behaving. None has been forthcoming. If this level of disruption and uncooperative unilateral conduct continues, in order to protect the integrity of this proceeding the Court may require an explanation from the TSRA, in its capacity as a native title representative body. It may do that by directing the Board members of the TSRA, and those officers within the TSRA responsible for this decision-making to appear and give evidence. Not for the purpose of entering into any review of its funding decisions, but to understand why it is taking such an uncooperative and disruptive role, and what, if anything, might and should be done about that, so as to protect the Court's judicial processes from abuse.
174 Whether, as a result of evidence from responsible Board members, and officers within the TSRA, evidence emerges that provides grounds for third party costs orders, will be a matter for determination at the time. Alternatively, there may be an innocent and simple explanation for the behaviour of individuals within the TSRA who are making these decisions.
175 Although for the reasons I have given no costs orders will be made at present, the Court will reserve the position of the costs of this CMH, for all parties except the TSRA. The Court will continue to monitor closely the progress of compliance with the Court's orders, and the support given by the TSRA in its capacity as a native title representative body, to Mr Akiba, Mr David, Ms Kanai and Mr Nona to facilitate that compliance. If there is evidence of further disruption and interference from the TSRA (whether as to funding or otherwise), the Court may revisit, of its own motion, not only the costs of the 18 December 2017 CMH, but any ongoing costs incurred by other parties because of the behaviour of individuals within the TSRA. If that is necessary, it will be done at a full hearing where the Board members responsible for making decisions about the TSRA's conduct will be required to give evidence, as might its legal officers. If any other orders against third parties are sought, they will be given consideration.
176 The Court's processes, and the principal role of the claim group members who assert native title in the Part B Sea Claim area, cannot continue to be undermined in the way that some individuals within the TSRA appear to have considered they are able to do to date. It is well past the time the TSRA should be supporting its constituents, not working against them.