Consideration and determination
14 In brief, the ABC contends that this is an appropriate case for indemnity costs having regard to the following matters.
(a) The alleged uncooperative conduct of the AFP parties leading up to the filing of the ABC's Urgent Application Before Start of a Proceeding, including refusing to extend the undertaking and their insistence that the matter come before the Court in any event. This was said to be contrary to their obligations as model litigants.
(b) The AFP parties persisted in "an unjustified rejection of the ABC's attempts to reach sensible agreement". The ABC submitted that the stated concern of the AFP parties relating to the timing of Mr McBride's trial was "illusory".
(c) The fact that it proved unnecessary to hear and determine the Urgent Application Before Start of a Proceeding, despite the position taken by the AFP parties in the correspondence referred to above.
(d) The "surprising attitude" of the AFP parties that forcing the ABC to apply for an urgent injunction and forcing the Court to hear and determine the matter would not entail "a significant expenditure of time and public funds", in circumstances where the ABC incurred considerable expenses in having to make the application, including paying a filing fee of $7,180.00, briefing counsel and preparing evidence and written submissions. The ABC submitted that the ultimate outcome suggested by the Court and adopted by the parties "reflected the very proposal the ABC put to the [AFP parties] in that correspondence".
15 The parties did not dispute the relevant principles, which are set out at some length in their respective outlines of written submissions and which are reflected in my reasons for concluding that there should be no order as to costs. Those principles relate to the exercise of the Court's discretion to award costs, whether on the normal basis or by way of indemnity costs.
16 The general principle which applies where it has proved unnecessary for the Court to determine the merits of an application were summarised by me in Australian Law Company Pty Ltd v Initiative Holdings Pty Ltd [2019] FCA 1561 at [16] to [18]. The starting point is that in such a case costs normally are assessed having regard to the approach of McHugh J in Re Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex parte Lai Qin [1997] HCA 6; 186 CLR 622, i.e. where it appears that both parties have acted reasonably in commencing and defending the proceeding and that conduct continues to be reasonable until the litigation is settled or otherwise does not require a final hearing, the proper exercise of the Court's costs discretion usually means that there is no order as to costs.
17 There is considerable force in the contention of the AFP parties that the ABC is not entitled to any costs, even on the normal basis, in circumstances where it failed to file any notice of appeal or indicate at any time possible grounds of appeal. Accordingly, the legal position as declared in the primary judgment prevails.
18 In any event, it has not been demonstrated by the ABC that the AFP parties have acted unreasonably so as to warrant an order for costs in its favour on the normal basis, nor engaged in conduct which is sufficiently grave to warrant an order for indemnity costs. My reasons for coming to those conclusions are as follows.
19 I accept the AFP parties' submission that, in considering whether to extend the undertaking, they had to weigh several factors, against which the reasonableness of their conduct should be gauged. Prior to the 24 February 2020 hearing, the position was as follows:
(a) From the commencement of the substantive proceeding, the ABC had disputed the AFP parties' contention that the matter required expedition.
(b) The AFP was subject to the disclosure obligations described at [8] above.
(c) The primary judgment confirmed the rights of the AFP parties with respect to the seized material.
(d) It was not known to the AFP parties if the Court would be able to accommodate any expedited appeal, especially if the filing of the appeal was delayed.
(e) The ABC had made no proper proposal for how the parties could usefully approach the Court to seek an expedited listing for an appeal that did not exist, on grounds that had not been formulated, and whose merits could not be assessed. As the AFP pointed out, the ABC failed to indicate on what basis the Court's jurisdiction could be enlivened in the absence of an application or appeal or other federal matter.
(f) The AFP parties had taken several steps to facilitate a 24 February 2020 hearing as the simplest and most expeditious way forward, including granting a short further extension to the undertaking and accepting short service.
(g) In its 23 February 2020 submissions, the ABC had indicated it required until 9 March 2020 (i.e. three weeks after publication of the primary judgment) to file any notice of appeal. It was not until the matter came on for hearing on 24 February 2020 that the ABC indicated a willingness to file any notice of appeal by 28 February 2020.
(h) The ABC had twice given an unequivocal indication of its intention to appeal (on 19 February 2020 and in the interlocutory application itself), but some uncertainty was created by Mr McAvaney's affidavit (see at [9] above).
20 Once the Court indicated at the outset of the hearing on 24 February 2020 that an expedited hearing of an appeal could be accommodated, the second respondent undertook to extend the undertaking. At the 24 February 2020 hearing, the ABC for the first time:
(a) indicated that it would consent to the matter proceeding on an expedited timetable;
(b) committed to the filing of any notice of appeal by 28 February 2020 (10 days earlier than the date proposed in the ABC's written submissions on the Urgent Application Before Start of a Proceeding); and
(c) committed to any appeal requiring no more than one day.
21 In those circumstances, I accept the AFP parties' submission that they cannot fairly be criticised for requiring the ABC formally to enliven the Court's jurisdiction and, subsequently, for the 24 February 2020 hearing to commence. Doing so involved no inconsistency with their obligation to act as a model litigant in Appendix B to the Legal Services Directions 2017 (Cth), which obligation "does not prevent … Commonwealth agencies from acting firmly and properly to protect their interests": see note 4 to para 2 of Appendix B.
22 The matters raised by the ABC concerning the McBride trial do not alter the position. It is irrelevant that the McBride trial, originally listed to commence on 2 March 2020, could theoretically have commenced prior to delivery of the primary judgment. Judgment was reserved in October 2019 and, at the instigation of the AFP parties, the Court was made aware on 18 December 2019 that the McBride trial was listed for hearing for ten days commencing on 2 March 2020. As noted above, this changed in February 2020 but, as the AFP parties point out, it may be inferred that the primary judge took the McBride trial timetable into account in publishing her reasons for judgment when she did.
23 I reject the ABC's submission that the concern of the AFP parties regarding the timing of Mr McBride's trial was "illusory". I do not doubt the genuineness of the AFP parties' concern to comply with the CDPP's Statement on Disclosure, nor the legitimacy of their concern to ensure that any appeal and subsequent application for special leave occur expeditiously with a view to the outcomes being known before Mr McBride's trial took place.
24 Finally, I do not accept the ABC's submission that the ultimate outcome on 24 February 2020 reflected the very proposal advanced by the ABC in its correspondence. In particular, the date fixed on that day for the ABC to file any notice of appeal was well in advance of any date previously put forward by the ABC.
25 Having regard to all these matters, I do not consider that the ABC has demonstrated that it was unreasonable of the AFP parties to require the ABC to approach the Court as it did, let alone that their conduct was sufficiently grave to warrant an order for indemnity costs.