Dudzinski v Kellow

REASONS FOR JUDGMENT 1 I am today concerned with a notice of motion by Mr Dudzinski, filed on 15 March 2000. In relation to this matter Mr Dudzinski advised the Registrar that he would not appear today, and wished his motion to be dealt with on the basis of his written material and submissions. 2 I will now indicate the core material to which I have had reference in respect of this notice of motion. 3 The present notice of motion, filed 15 March 2000, seeks: "1. To review the Certificate of Taxation Q 110/99 dated 29.2.2000 of Deputy Registrar Baldwin and her decision of 23.2.2000, and disallow [sic] of costs on the grounds of improper, vexatious or unnecessary matter in documents or proceedings and other grounds mentioned in the applicant's notice of motion of 24.1.2000 and the amended and the supplementary statement of objections of 17.2.2000 and 21.2.2000, and especially to reduce the costs by 1/3 on [sic] virtue of Order 62, rule 36A before any consideration as to issue of Taxation Certificate. 2. Orders sought by the applicant in his notice of motion of 24.1.2000 accepted for filing on 27.1.2000 be granted. 3. The cost of the applicant's notice of motion of 24.1.2000 accepted for filing on 27.1.2000 and incidental to it be costs of the Respondents. 4. Decision of Deputy Registrar Baldwin of 23.2.2000 be quashed. 5. The costs of this notice of motion dated 15 March 2000 and incidental to it be the costs of the respondents." 4 The reference in that notice of motion to the earlier notice of motion accepted for filing on 27 January 2000 is a reference to a motion by Mr Dudzinski which was made returnable at 2.30 pm on 23 February 2000, and sought orders: "1. To disallow of costs [sic] on the grounds of improper, vexatious or unnecessary matter in documents or proceedings and other grounds mentioned in annexed statement of objections. 2. In the event of allowing the taxation to reduce the costs by 1/3 on virtue [sic] of Order 62, rule 36A. 3. To adjourn the taxation if allowed pending first: 3.1. review of the decision of the Full Federal Court in Dudzinski and Kellow [1999] FCA 1264 and by the High Court in B56/99 matter. 3.2. Determination by the High Court of applicant's applications regarding prerogative orders sought against, Drummond J, Spender J, and French J, Withlam J [sic], Lindgren JJ, and Registrar Reynolds. 3.3. The determination of all proceedings in the Human Right and Equal opportunity Commission (HREOC) including review the HREOC's decision; 4. On virtue [sic] of Order 1, rule 8 the Court will dispense the applicant to pay $750 as a security deposit on virtue [sic] of Order 62, rule 46(3)(d)." 5 This earlier motion also sought discovery from Minter Ellison of documents relevant to certain specified items in the respondent's bill of costs, and sought that the costs of and incidental to that notice of motion be costs of the respondents. 6 Written submissions by Mr Dudzinski were received in the Registry on 19 May 2000. They commence: "From the beginning of this submission the applicant request[s] that the hearing be adjourned pending review by High Court of the decisions of Drummond J, Spender J, French, Withlam [sic], Lindgren J and Registrar Reynolds." 7 Apart from that request, the balance of the documents filed by Mr Dudzinski are directed to issues on the motion of 15 March 2000. 8 In relation to the requested adjournment, I note that the affidavit of Margaret Alice Brown (a solicitor for the respondent) filed 23 May 2000 annexes a Certificate of Deemed Abandonment issued by the High Court Deputy Registrar on 27 April 2000 in relation to Mr Dudzinski's application for special leave to appeal - No B56/1999. Ms Brown deposes that this abandoned application relates to the judgment of the Full Court of the Federal Court on 27 August 1999, and counsel for the respondent indicated today that she is not aware of any other applications by Mr Dudzinski pending in the High Court. 9 Even assuming Mr Dudzinski does have an application for special leave pending in the High Court, however, there seems to be no basis in the material on which the Court should grant an adjournment, particularly having regard to the history of the matter and my refusal of Mr Dudzinski's application for an order staying the order of the Full Court requiring him to pay the respondent's costs of his application for leave to appeal. It seems to me that, in effect, Mr Dudzinski is seeking to achieve by an adjournment much of the practical relief that a stay of the Full Court's order for costs would have given him. As a preliminary matter, then, I refuse the adjournment and turn to consider the substance of Mr Dudzinski's motion. 10 It is necessary first to set out in some detail the history of the matter. Mr Dudzinski instituted proceedings in the Federal Court of Australia on 27 October 1997. Drummond J gave judgment in those proceedings on 8 April 1999: Dudzinski v Kellow [1999] FCA 390. His Honour struck out substantial parts of the amended statement of claim brought by Mr Dudzinski against Griffith University and certain of its staff, and ordered a permanent stay of the action in this Court. 11 Mr Dudzinski's subsequent application for leave to appeal from the orders of Drummond J was dismissed by a Full Court of the Federal Court (French, Whitlam and Lindgren JJ) on 27 August 1999: Dudzinski v Kellow [1999] FCA 1264. The Full Court also ordered Mr Dudzinski to pay the respondents' costs of the application for leave to appeal. 12 On 3 November 1999, a bill of costs was lodged by Minter Ellison Lawyers on behalf of the respondents in the application for leave to appeal. The bill was delivered at $18,761.33. Mr Dudzinski then made an application for a stay of the Full Court orders, which application I dismissed on 23 November 1999: Dudzinski v Kellow [1999] FCA 1665. Mr Dudzinski sought that I disqualify myself from hearing that application, but I declined to accede to his request. 13 On 4 November 1999 the District Registrar, pursuant to O 62 r 46 of the Federal Court Rules (the Rules), declined an appointment to tax the bill of costs and directed that taxing officer H. Baldwin, without making a determination of the individual items in the bill of costs, make an estimate of the approximate total for which, if the bill were to be taxed, a certificate of taxation would be likely to issue. 14 Deputy District Registrar Heather Baldwin (DDR Baldwin) in her capacity as taxing officer and pursuant to the provisions of O 62 r 46, then made an estimate in the amount of $17,700 in respect of the bill. By letters dated 7 January 2000, the District Registrar then wrote to both parties advising them of the estimate. Those letters went on to say that if either party wished to object to the amount of the estimate, a notice of objection should be filed and served within 14 days of the date of receipt of the estimate. They also advised that: "At the time of filing the notice of objection, payment of $750.00 to the Registrar by way of security for costs of any taxation is required." 15 The applicant filed a notice of objection on 27 January 2000, and on that day also filed a notice of motion. The notice of motion was considered by DDR Baldwin on 23 February 2000, when she dismissed it and ordered Mr Dudzinski to pay the respondents' costs of and incidental to the notice of motion to be taxed if not agreed. In dismissing the notice of motion, DDR Baldwin said: "In calculating the fourteen day period it should be borne in mind that the Court was in vacation and pursuant to Order 3 rule 5 time does not commence to run until the end of 14 January unless the court otherwise orders. The applicant's notice of objection was therefore filed within time. At the time of filing his notice of objection the applicant did not pay the $750.00 security for costs." 16 In the light of the material on which Mr Dudzinski relies in his written submissions on the motion with which I am presently concerned, it is useful if I set out some provisions of the Rules and of the Federal Court of Australia Act 1976 (the Act). 17 Order 62 rule 46 deals with assessment procedures for costs, and O 62 r 46(3) relevantly provides: "(a) Upon the direction of the Registrar under subrule (2), a taxing officer may, without making any determination on the individual items in the bill, make an estimate of the approximate total for which, if the bill were to be taxed, the certificate of taxation would be likely to issue. (b) The Registrar will notify each party interested in the bill in writing of an estimate made under paragraph (a). (c) Unless within 14 days of receipt of notice under paragraph (b), a party interested files and serves on each other party a notice of objection to the estimate, there shall be no taxation, and the amount of the estimate shall be deemed to be the amount for which a certificate of taxation may issue. (d) Upon filing a notice of objection a party shall pay to the Registrar an amount of $750 as security for the costs of any taxation of the bill. (e) Where a notice of objection is filed, the Registrar may direct that subrule (4) apply, or that taxation of the bill proceed." 18 Order 62 rule 46(4A) provides: "If a notice of objection is filed under paragraph 46(3)(c), or a notice requiring a full taxation is filed under paragraph 46(4)(c), the party filing the notice shall bear the costs of taxation of all parties from the date of filing the notice unless, on taxation, there is obtained in that party's favour a variation of at least 15% of the estimate of taxed costs or of the amount provisionally taxed." 19 Order 62 rule 46(6A) provides: "If: (a) 21 days have passed after notification by the Registrar to the parties of a completed taxation or provisional taxation under this rule; and (b) No party has objected to the taxation or provisional taxation; the Registrar, after having regard to the liability of any party to pay costs of the taxation under this Rule, must: (c) determine how the amount paid to the Registrar as security for the costs of taxation is to be distributed or refunded to the parties; and (d) direct that payment be made out of Court accordingly." 20 Order 62 rule 46(7) provides: "In this rule a reference to a Registrar extends only to persons occupying the office or for the time being performing the duties of Registrar or District Registrar of the Court". 21 Section 35A(1) of the Act provides: "Subject to sub-section (2), the following powers of the Court may, if the Court or a Judge so directs, be exercised by a registrar: … (g) the power to make an order exempting a party to proceedings in the Court from compliance with a provision of the Rules of Court; …" 22 Order 1 rule 8 provides: "The Court may dispense with compliance with any of the requirements of the Rules, either before or after the occasion for compliance arises." 23 DDR Baldwin, on the hearing of Mr Dudzinski's notice of motion filed 27 January 2000, accepted that she had a discretion to dispense with payment of the security for costs pursuant to s 35A(1)(g) of the Act and O 1 r 8 of the Rules, and invited Mr Dudzinski to address her on why she should exercise that discretion in his favour. The submissions which Mr Dudzinski made on that occasion were based on the fact that he is a social security recipient, had no financial means with which to pay the $750 security for costs, and had received waiver of court filing fees in the past. He submitted that he should be given waiver of the security for costs for the same reasons for which the court fees had been waived. 24 In her reasons for decision, DDR Baldwin drew a distinction between filing fees and the payment of security for costs referred to in O 62 r 46(3)(d), as follows: "The Federal Court Regulations provide exemption from payment of filing fees, hearing fees and setting down fees to certain individuals if they are a holder of certain cards issued by the Department of Social Security or Department of Veterans' Affairs … The Regulations do not allow for exemption from payment of the security for costs fee provided by Order 62 rule 46. The fact that the security for costs fee is not included in the exemption provisions of the regulations supports the submissions made by the respondent that the security for costs fee is quite a different fee from a filing fee, setting down fee or hearing fee. 25 In this regard, DDR Baldwin noted that the fees referred to in the Federal Court of Australia Regulations 1978 as being subject to exemption in certain circumstances (filing fees, setting down fees and hearing fees) are collected by the Federal Court and paid into government revenue, whereas the amount payable for security for costs is not paid into government revenue, but is ultimately returned to one of the parties at the conclusion of taxation. 26 Having regard to O 62 r 46(4) and (4A), the obvious intent of the requirement for payment of security for costs is to provide a fund against which a party who has been unsuccessfully challenged in relation to an estimate or provisional taxation (to the extent of 15 per cent of the bill) might apply their costs of attending the resultant taxation of the bill. 27 DDR Baldwin said: "The applicant was not able to refer me to any other basis upon which I should exercise my discretion to waive requirement of the security for costs, apart from the fact that he is a social security recipient. In the absence of any other reasons, I decline to make an order waiving compliance with Order 62 rule 46(3)(d)." 28 On the basis of that finding, the Deputy District Registrar said: " … it is not necessary for me to consider the other items in the notice of motion. As I have already stated, those items are in essence matters that would have been more appropriate for the taxing officer to consider and determine at a taxation." 29 She ordered, therefore, that the notice of motion filed 27 January 2000 be dismissed. On 29 February 2000, in her capacity as taxing officer, she issued a certificate of taxation (as required by O 62 r 45) allowing $17,700. 30 I have already set out Mr Dudzinski's more recent notice of motion, filed on 15 March 2000. In his written submissions he submits that the issues are: whether a taxation of costs should be allowed when the bill of costs was prepared negligently; and whether the taxation of costs against him should be allowed in full and not be cut by one-third before allowing taxation, by virtue of O 62 r 36A. 31 Order 62 rule 36A provides that: "Where a party is awarded judgment for less than $100,000 on a claim … any costs ordered to be paid, including disbursements, will be reduced by one-third of the amount otherwise allowable under this Order unless the Court or a Judge otherwise orders." 32 Order 62 rule 36A(2), which is the one on which Mr Dudzinski specifically relies, provides: "If the Court or a Judge is of the opinion that a proceeding …brought in this Court could more suitably have been brought in another court or in a tribunal and so declares, then any costs to be paid, including disbursements, will be reduced by one-third of the amount otherwise allowable under this Order." 33 Mr Dudzinski fails to appreciate that the permanent stay of the Federal Court proceedings by Drummond J on 8 April 1999 was, in part, based on his finding that part of the relief sought by Mr Dudzinski ought properly to have been the subject of proceedings in the District Court. That circumstance does not provide a basis on which the respondent, in seeking successfully the strike-out of parts of the statement of claim and the permanent stay of other parts of it, should be denied their full costs. 34 I have earlier set out the notice of motion with which I am presently concerned, and in some detail the history of the litigation leading to that notice of motion. Notwithstanding the first order sought on the motion, it seems to me that the primary question concerns the correctness of the exercise of discretion by DDR Baldwin in declining to waive the $750 payment required by O 62 r 46(3)(d) "as security for the costs of any taxation of the bill." 35 In the view I take of the matter, Mr Dudzinski has sought review of DDR Baldwin's rejection of the relief claimed by him in his notice of motion, heard and determined by DDR Baldwin on 23 February 2000. Consistent with my view of the constitutional limitations that attach to the exercise of federal judicial power, a review of such a decision is a review de novo: it is akin to a review of a decision made by a Judicial Registrar under the former provisions of the Industrial Relations Court of Australia in respect of unlawful dismissal. Regard can properly be had to the Registrar's reasons for decision, but on a review of a decision made in the exercise of a power delegated to the Registrar, the court must conduct the review as if the judge of the court was the original decision maker. 36 I take the view that there is a power in the court, pursuant to s 35A(1)(g) of the Act and O 1 r 8 of the Rules, to dispense with the obligation to pay $750 as security for the costs of any taxation, as DDR Baldwin found. However, the purpose of the requirement for the payment of $750 as security for the costs of any taxation of the bill is apparent from the operation of O 62 r 46(4A): it is a rule for the protection of the party whose bill of costs is challenged. It is, in my opinion, the price which ordinarily has to be hazarded for the exercise of the right to challenge. It is not as if a person should, as a matter either of fairness or justice, have a "free hit" devoid of any financial consequences even if the challenge to a bill of costs is unsuccessful, or substantially unsuccessful. 37 Having regard then to the purpose of the rule requiring the payment of security for the costs of taxation, any reasons proposed for waiving such a payment would have to be very compelling. The only basis suggested in the present case is that Mr Dudzinski is a recipient of a social security pension, and that he is unable to pay the $750. No doubt encouraged by the fact that under the Federal Court Regulations a social security recipient is exempt from the payment of filing, setting down and hearing fees, he argues that his status as a social security recipient should also entitle him to a favourable exercise of the discretion to waive the payment of security for the costs of his challenge to the respondents' bill of costs. 38 Having regard to the clear distinction between filing, setting down and hearing fees and the provision of a sum by way of security for the costs of a challenge to a bill of costs, it seems to me that no sufficient reason has been shown for waiving the requirement of O 62 r 46(3)(d). In those circumstances, it seems to me right to regard the position as being that Mr Dudzinski has not invoked the prescribed method of challenge to the bill of costs that arises where a Registrar has directed a taxing officer to make an estimate of the approximate total for which, if the bill were to be taxed, the certificate of taxation would be likely to issue. 39 I have earlier referred to the misapprehension by Mr Dudzinski of the applicability of O 62 r 36A(2) in the circumstances of his original application in this Court, his unsuccessful application for leave to appeal and his unsuccessful application for a stay of the orders of the Full Court, as well as the issuing of a Certificate of Deemed Abandonment by the High Court Registry in relation to Mr Dudzinski's application for special leave to appeal in that Court (No B56/99). The only other matter to which express reference need be made, in my view, is the provisions of O 62 r 36(1) and (2). Sub-rule 36(1) confers on the Court or a Judge a discretion to: "(a) direct that any costs which have been improperly, unreasonably or negligently incurred be disallowed; [or] (b) direct the taxing officer to examine the costs incurred, and to disallow such costs as he shall find to have been improperly, unreasonably or negligently incurred; … …" 40 Order 62 rule 36(2) imposes a duty on a taxing officer to look into that question where it has not been previously raised and dealt with by the Court or a judge, and the same consequences are to ensue as if the taxing officer had been specially directed to examine any costs incurred under sub-rule 36(1)(b). There is nothing in the material before me to permit the conclusion that the taxing officer, in making the estimate that she was directed to make by District Registrar Ramsey, was in breach of the obligation imposed by O 62 r 36(2); nor, in my opinion, is this a case where the Court should make a direction under O 62 r 36(1). 41 To do so would be to subvert the specific procedures provided for by the rules in relation to an estimation of costs on a taxation. In Fuller v Minister for Primary Industries and Energy and Another, an unreported Federal Court judgment of French J on 15 April 1998, His Honour said: "The purpose of the rules under which the Registrar may make an estimate of the approximate total of the costs to be taxed is to provide a mechanism for the efficient and inexpensive disposition of cost assessments. A party objecting to the estimate does so at his own risk as to the costs of the process of taxation which he invokes. In this case Mr Fuller sent a fax to the Registrar which, on a broad view, could have been taken to be a notice of objection to the estimate. Subject to the payment of the security for costs required under O 62 r 46(3)(d) it might have been treated as such." 42 It seems to me that to permit a challenge to a bill of costs by the making of an order pursuant to O 62 r 36(1), where a party has not complied with the requirements of O 62 r 46, nor demonstrated a basis on which the payment required by O 62 r 46(3)(d) should be waived, would be to circumvent the assessment procedure. This is particularly so where there is no evidence, apart from the assertion made by Mr Dudzinski, to suggest that the circumstances for such a direction are met in this case. 43 For the above reasons, none of the orders sought by Mr Dudzinski in his notice of motion filed 15 March this year should be allowed. No material has been put before me to suggest that any order other than the usual order as to costs is appropriate in this case, and on the request by the respondents for costs of the motion, I order that the costs of and incidental to the motion of Mr Dudzinski filed 15 March 2000 be taxed if not agreed, and be paid by him to the respondents to the motion.