Croker v Deputy Registrar of the High Court of Australia

Hely J: 1 This is an application for leave to appeal from a decision of Madgwick J given on 15 May 2003 in which his Honour ordered that the appellant provide security for the second respondent's costs of the pending appeal in the sum of $8000. Madgwick J ordered that the appeal be stayed until that security is provided. 2 It is clear from s 56 of the Federal Court of Australia Act 1976 (Cth) ("the Act") and from Order 52 Rule 20 of the Federal Court Rules, that a single judge of the Court has power to order the provision of security for the costs of an appeal, even though the appeal itself it is to be heard before a Full Court. 3 The decision whether or not to order the provision of security for costs and the quantum of any such security involves the exercise of a discretion by the primary judge in a matter of practice and procedure. Accordingly, leave to appeal would ordinarily be granted only where the decision is attended by sufficient doubt to justify it being reconsidered by the Full Court and where substantial injustice would result if leave were refused supposing the decision to be wrong. 4 Madgwick J considered that the present case was a proper case in which to order the provision of security because: first the appellant is impecunious and there is a substantial likelihood that the second respondent could not recover his costs of the appeal from the appellant in the event that the appeal fails; second, the second respondent did not contribute to the appellant's state of impecuniosity; and third, whilst the judge, at first instance, ordinarily exercises a great deal of circumspection in speculating on the prospects of success of an appeal, this appeal is hopeless. 5 The affidavit filed by the appellant in support of the leave application asserts that Madgwick J erred in law in that a single judge of the Court cannot decide whether an appeal is incompetent and second, the appeal is "well under way", hence the order for security is a denial of natural justice and a gross miscarriage of justice. 6 In written submissions filed on 1 July 2003, the appellant contended in reliance on the decision of Beaumont J in Endormer Pty Limited (In Liquidation) v Australian Guarantee Corporation Limited [2001] FCA 510, that the application for security for costs should go to the Full Court. 7 In oral submissions made to me this morning, the appellant elaborated upon those contentions and, in addition, relied upon the fact that none of the factors taken into account by Madgwick J are to be found within Order 28, Rule 3, which deals with the cases in which the ordering of security is appropriate. So far as this last submission is concerned, it is clear from the authorities that the discretion of the Court to order security of costs under s 56 of the Act is not limited to the circumstances described in Order 28 Rule 3, hence this submission by the appellant should be rejected. 8 One of the factors properly to be taken into account in deciding whether or not to grant security for costs, is whether the appeal is without real merit. Madgwick J referred to the circumspection which a single judge ordinarily exercises in speculating on the prospects of success of an appeal. Nonetheless, his Honour concluded that the appeal was hopeless. In my view, his Honour was entitled to take this matter into account in deciding whether to order the provision of security and the appellant has not shown that his Honour's assessment of the prospects of success on the appeal was erroneous. 9 The appeal from the decision of Allsop J was filed on 18 February 2003. The motion for security of costs was taken out on 8 April 2003. Security was sought relatively promptly, as it should be. Whether the appeal was "well under way" when the security was sought may depend upon what that expression is intended to convey, but the lapse of time of about six weeks is not a reason for not making an order for security. 10 In the decision in Endormer, Beaumont J referred the question of security to a Full Court, not because he was bound to do so, or because he lacked power himself to order the provision of security, but because in the exercise of his discretion he considered that that was the more appropriate course to follow in the particular circumstances of that case. In Dranichnikov v Centrelink [2002] FCA 1622, Spender J made an order for security for costs in relation to a pending appeal, notwithstanding the observations of Beaumont J in Endormer, to which Spender J referred. In Endormer a Full Court had been constituted to hear the appeal and a date had been fixed for its hearing. In those circumstances Beaumont J considered it appropriate to refer the matter to the Full Court. That is not the case here. Madgwick J was fully entitled to determine the motion for security himself. He was not bound to refer it to a Full Court which would need to have been specially constituted to deal with it. 11 The appellant submitted that this application itself should be referred to a Full Court rather than being dealt with by me, because if I deal with the matter, then there would be no appeal to a Full Court from my decision. In my view, I should determine the matter myself rather than requesting the Chief Justice to convene a Full Court for that purpose. Wati v Minister for Immigration and Multicultural Affairs (1997) 78 FCR 543, and in particular at 554, decides that this is a matter for me to determine. I do not consider it to be appropriate for this matter to be referred to a Full Court because, in my opinion, the decision of Madgwick J was clearly correct. None of the criteria for grant of leave to appeal have been satisfied. 12 If one takes account of the history of this matter, which commenced in the District Court and which proceeded to the Supreme Court, then to the Court of Appeal, then to the High Court and which is now in the Federal Court, it is plainly a proper case for the provision of security, given the appellant's impecuniosity and the prospects of success on the appeal. 13 It has not been established that Madgwick J misdirected himself in point of principle, or that the discretion which was vested in him has in any way miscarried. 14 I dismiss the application for leave to appeal from that decision with costs. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hely.