Al-Jashamy v Minister for Immigration & Multicultural & Indigenous Affairs

REASONS FOR JUDGMENT 1 This judgment deals with the issue of costs in proceedings seeking the release of the applicant from detention by the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"). Before the final hearing scheduled for 10 June 2004, the applicant was granted a six-month bridging visa. On 10 June 2004 I heard submissions concerning costs and reserved judgment. I indicated that I would deliver judgment if the parties could not reach agreement about costs. On 5 July 2004 the Court was informed the parties were unable to reach agreement. 2 The application was filed in this Court on 5 January 2004. It was brought pursuant to ss 39B(1) and 39B(1A) of the Judiciary Act 1903 (Cth). The applicant sought a declaration that he was being unlawfully detained and a writ in the nature of habeas corpus directing the Minister to cause the release of the applicant from detention. The applicant sought to rely on the principles established by the Full Court in Minister for Immigration & Multicultural & Indigenous Affairs v Al Masri [2003] FCAFC 70; (2003) 126 FCR 54. The matter was listed for hearing on a final basis on 3 March 2004. During the course of that hearing, counsel for the Minister successfully applied for an adjournment to enable documents (which might have become part of the evidentiary case of the Minister) to be retrieved from archives and made available to the applicant. The matter was adjourned part heard and was listed for further hearing on 26 March 2004. 3 On 22 March 2004, the matter was listed for directions to determine what arrangements were to be made for the examination of a witness the Minister proposed to call. The directions were adjourned until 24 March 2004. The matter was again listed for directions on 25 March 2004, when counsel for the applicant successfully applied for an adjournment. The hearing date of 26 March 2004 was vacated, the matter was listed for further directions on 6 May 2004 and for further hearing on 10 June 2004. At the directions hearing on 6 May 2004 the Court was informed the matter would be heard on a final basis on 10 June 2004. 4 On 11 May 2004 the Minister granted the applicant a special purpose visa and released him from detention. The applicant was granted a six-month bridging visa on 12 May 2004. On 10 June 2004 the parties made submissions concerning the costs of the proceedings. 5 The Minister submitted that each party should bear their own costs. The applicant sought his costs of the application. The power to award costs is a broad discretionary one but it should be exercised judicially. In the present case, the application remains undetermined. In those circumstances it is often appropriate to make no order as to costs. There are numerous cases concerning how costs should be dealt with when the matter has not been determined. I refer, only for convenience, to Aussie Red Equipment Pty Ltd v Antsent Pty Ltd [2001] FCA 1641 in which I considered this issueat [11] and following: Section 43 of the Federal Court of Australia Act 1976 (Cth) confers on the Court a broad discretionary power to order that a party pay the costs of another party, though the power must be exercised judicially. In matters such as this one, where the substantive issues raised by the proceedings have been resolved without a hearing on the merits, it will rarely be appropriate for a Court to determine the merits of the dispute solely for the purpose of deciding any outstanding issue of costs, (see: Australian Securities Commission v Aust-Home Investments Limited (1993) 44 FCR 194). In that matter, after a review of the relevant authorities, Hill J identified five propositions emerging from the case law. Only the first four propositions are presently relevant, they are as follows: "(1) Where neither party desires to proceed with litigation the court should be ready to facilitate the conclusion of the proceedings by making a cost order: Stratford and the SEQEB case. (2) It will rarely, if ever, be appropriate, where there has been no trial on the merits, for a court determining how the costs of the proceedings should be borne to endeavour to determine for itself the case on the merits or, as it might be put, to determine the outcome of a hypothetical trial: Stratford. This will particularly be the case where a trial on the merits would involve complex factual matters where credit could be an issue. (3) In determining the question of costs it would be appropriate, however, for the Court to determine whether the applicant acted reasonably in commencing the proceedings and whether the respondent acted reasonably in defending them (SEQEB). (4) In a particular case it might be appropriate for the Court in its discretion to consider the conduct of a respondent prior to the commencement of the proceedings where such conduct may have precipitated the litigation: cf Sunday Times Newspaper Co Ltd v McIntosh (1933) 33 SR (NSW) 371. (5) …" These propositions, as Cooper J commented in Australian Securities Commission v Berona Investments Pty Ltd (1995) 18 ACSR 772 at 774, represent a guide rather than an exhaustive list of the matters which may be taken into consideration in the exercise of the discretion to order costs under s 43. More recently, in Re the Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex parte Lai Qin (1997) 186 CLR 622, McHugh J made the following comments about the discretion to order costs in matters resolved without a hearing on the merits: "In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order. In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action. … Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. This is perhaps the best explanation of the unreported decision of Pincus J in The South East Queensland Electricity Board v Australian Telecommunications Commission where his Honour ordered the respondent to pay 80 per cent of the applicant's taxed costs even though his Honour found that both parties had acted reasonably in respect of the litigation. But such cases are likely to be rare. If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases." A survey of cases where these broad principles have been applied reveals that, although the particular facts and circumstances of each case are of paramount importance, frequently the determining factor is the reasonableness of the parties' conduct, (see for example Gribbles Pathology Pty Ltd v Health Insurance Commission (1997) 80 FCR 284, Reddy v Hughes (1996) 37 IPR 413 and Emerald Properties Pty Ltd v Chan Unreported, Heerey J, 15 December 1993). Another important consideration will often be the circumstances under which the substantive issues in the proceedings were resolved. In ONE.TEL Ltd v Deputy Commissioner of Taxation [2000] FCA 270, Burchett J made the following observations: "In my opinion, it is important to draw a distinction between cases in which one party, after litigating for some time, effectively surrenders to the other, and cases where some supervening event or settlement so removes or modifies the subject of the dispute that, although it could not be said that one side has simply won, no issue remains between the parties except that of costs. In the former type of case, there will commonly be lacking any basis for an exercise of the Court's discretion otherwise than by an award of costs to the successful party. It is the latter type of case which more often creates problems, since there may be difficulty in discerning a clear reason why one party, rather than the other, should bear the costs." 6 In this matter, the action of the Minister in granting the applicant a visa has meant that the application would fail at least in the sense that even if the applicant was able to establish he fell within the principles established by the Full Court in Minister for Immigration & Multicultural & Indigenous Affairs v Al Masri (supra), the relief sought would be unnecessary and probably would not be granted because to do so would be an act of futility. Because the Minister granted the visa, the applicant was no longer an unlawful non-citizen and could not be detained under ss 189 and 196 of the Migration Act 1958 (Cth). In fact, he was released. The legal and factual foundation for the relief sought thereby evaporated as a result of the action of the Minister. 7 My impression at various points during the hearing (a large amount of evidence was led and, in various ways, the legal arguments of the parties were ventilated) was that the applicant had a case of real substance even though at no stage was I left with the impression that the case was unassailable. Certainly the applicant did not act unreasonably in making the application, but the Minister did not act unreasonably in defending it. Moreover, as appears to be common in cases such as this, events changed over time and the strength of the applicant's case waxed and waned to some extent between the time the application was filed and the time the visa was granted. It is probably inappropriate to say that the grant of the visa by the Minister was a "surrender" of the type referred to by Burchett J in the passage quoted above. Nonetheless, in practical effect, it provided the applicant with the relief he sought. On the other hand, it is probably desirable that the Minister should not be deterred from granting such a visa in broadly analogous cases by then being ordered to pay the entire costs of applicants in proceedings such as the present. 8 In my opinion, the appropriate order is that the Minister pays the applicant half his costs as agreed or taxed. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore.