Australian Agricultural Co Ltd v AMP Life Ltd

REASONS FOR JUDGMENT 1 On 30 September 2003, I delivered judgment dismissing a claim by the applicant ("AACo") for an interlocutory injunction against the first and second respondents ("AMP"). The third respondent ("Nebo") was joined as a party to the proceedings because its rights would have been affected by the grant of an injunction. 2 On the day judgment was delivered, I ordered that Nebo's costs of the application for interlocutory relief be paid by AACo on the usual party and party basis. There is therefore no need to deal further with the question of costs as between Nebo and AACo. 3 AMP, however, sought an opportunity to make written submissions as to the appropriate costs orders in respect of the interlocutory proceedings. Accordingly, I gave directions for the filing of written submissions by AMP and AACo addressing the question of costs as between them. The written submissions have now been received by me. 4 AMP seeks orders that: (a) AACo pay the costs of the interlocutory proceedings; (b) the costs be paid on an indemnity basis; and (c) independently of (b), the costs be paid by AACo forthwith. 5 AACo resists all the orders sought by AMP. It submits that the costs of the interlocutory proceedings should be costs in the cause. 6 An applicant whose application for interlocutory relief fails is not necessarily ordered to pay the respondent's costs of that application. In some circumstances, as AACo submits, it is appropriate that the costs of the interlocutory proceedings be costs in the cause and await the final outcome of the proceedings. However, in this case AACo did not fail simply on discretionary grounds associated with the balance of convenience. It failed to establish that there was a serious issue to be tried that the representations made by AMP were misleading and deceptive. In addition, I held that AACo did not have a sufficient interest to warrant the grant of an injunction which would infringe Nebo's rights under its contract to purchase the Stanbroke Shares. In these circumstances, in my opinion, AACo should pay AMP's costs of the application for interlocutory relief. 7 There is no disagreement between the parties as to the principles that apply in determining whether an order should be made for the payment of costs on an indemnity basis: see Federal Court of Australia Act 1976 (Cth), s 43(1), (2); Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225, at 232-234, per Sheppard J; Re Wilcox; Ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151, at 153, per Black CJ, at 156-157 per Cooper and Merkel JJ. 8 AMP relied on two factors as constituting special circumstances enlivening the discretion to award costs on an indemnity basis: