GARRY FRANCIS BULLOCK & ORS v THE FEDERATED FURNISHING TRADES

Federal Court of Australia|1985-02-26|Before: Woodward JJ, Wocdward JJ, Latham CJ, Dixon JJ

FEDERAL COURT - practice and procedure ~ costs certificate -

costs of unsuccessful respondent - discretion to grant -

Smithers, Sweeney and Woodward Jd. 26 February 1985 Melbourne

GARRY FRANCIS BULLOCK, JOHN SKILBECK AND GRAHAM JAMES HARKNESS

THE FEDERATED FURNISHING TRADES SOCIETY OF AUSTRALASIA, L. KYRIACOU, A. FINDLAY, R. SHUGG, ALVONNE NOMINEES PTy. LTD. (Trading as A..F. CARPET DISTRIBUTORS), COLONY CARPETS PIrY. LTD.. R.G. CARPET AGENCIES PTY. LID., CARPET WHOLESALERS (VIC.) PTY. LTD., OTTO FLOORS PTY. LTD... V.E. MACKEY & CO. PTY. LTD. JASON CARPETS COMMERCIAL PTY. LTD., AND GURIAN PTY. LTD. (Trading as MYER TEALE)

) VICTORIA DISTRICT REGISTRY.) - YG NO, 209 CF i984 °- a } ae i]

BETWEEN: GARRY FRANCIS BULLCCK, JOHN . SKILBECK AND GRAHAM JAMES

CARPETS, "Cor RCTAL PRY. if AND Gt TAN PTY. 'LTD. {Trading as MYER TEALE)

In this matter the unsuccessful respondents to an appeal

have sought a costs certificate from the Court pursuant to s.6

of the Federal Proceedings (Costs) Act 1981 (the Act). That

section, so far as is relevant for present purposes, reads:

")) Subject to this Act, where a Federal. appeal succeeds on a question of law, the court that heard the. appeal may, on the application of a respondent to the appeal, grant to the respondent a costs certificate in respect of the appeal. (2)... (2) The certificate that may be granted under sub-section (1) or (2) by a court to a respondent to a Federal appeal is a certificate stating that, in the opinion of the court it would be appropriate for the Attorney-General to authorize a payment under this Act to the respondent in respect of - - - (ai the costs incurred by the respondent in relation to the appeal; ..."

There is no doubt that the appeal in the present case was a Federal appeal, within the meaning of the Act, and it did succeed ona question or law. It is equally clear that the grant of a certificate is a matter for the discretion cf the Court and s.13 of the Act provides that no appeal lies

In our view the discretion of the Court is umfettered, once the respondent shows that the grant of a certificate is within the power of the Court, though it must of course fe

The respondents have arqued that there is a presumption in favour of the grant of a certificate once the pre-requisites are satisfied. It was said that a certificate

should only be refused if the respondents have been in some

way responsible for the error of the Court below - by failing, perhaps, to draw attention -to a relevant _ statute 'or the ;

over-ruling of an apparently binding precedent - - or the -

request is for some other reason unméritoricds. ~ = ls.

In our view there is no such presumption. ; "The unsuccessful respondent must satisfy the Court' Cor a member of it sitting in Chambers - see s.12) that it is appropriate in all the circumstances for a certificate to be granted, and the circumstances which could properly influence that decision are many and various. One matter to be borne in mind in all cases is that it is the taxpayer who is being asked to bear the cost, up to a maximum of $3,000 in this Court, of the error of law which has occurred. This fact may produce a different emphasis in decisions under this Act from those reached in jurisdictions where the payments are made from a special fund

which is automatically contributed to by all litigants through

However the basic principles to be applied in the exercise of discretion will not vary on this account and we are confirmed in the view we take by the judgment of the Full Court of the Supreme Court of Western Australia in Richards v Faulls Pty Ltd £19713 WAR 129 at 137-8. In construing similar legislation the Court said, :

"The question is whether the power which is conferred upon the Court shovld be exercised. It is a discretionary power and

the grant of the certificate follows upon and requires the exercise of the discretion.

Hence it is a discretion to grant; it is not a discretion to refuse. Hence it is not the position, adapting to this case the words of the joint judgment of Latham CJ Rich and Dixon JJ in Main v Main (1949), 78 CLR 636, at p.643, that once facts are proved bringing the case within s.10(1) a certificate should be granted unless the court thinks on discrétionary grounds that the certificate should be withheld; on the contrary, the unsuccessful respondent to an appeal must show some ground calling for the exercise of the discretion in his favour and he does not do this merely by showing that the appeal has succeeded on a question of law: Reeve v Fowler, £19653 NSWR 110, per Walsh J at p. 111. Of course the nature of the case may in itself show that a certificate should be granted and not infrequently the court is able to act without further evidence or argument.

It is axiomatic that when a discretion is given to a court oar a judge the discretion must be exercised judicially, that is to say according to proper principles: indeed one of the comparatively few grounds upon which a Giscretionary decision can be successfully challenged on appeal is that there was in it some error of principle. When a new discretion is created by statute one looks primarily to the statute itself for guidance, either express or implied, as to the principles upon which the discretion is to be exercised, that is to say what factors should be taken into account, or, on the other hand, put aside as irrelevant when reaching a decision. Some of the difficulties arising under this Act are illustrated in the judgment of Moffitt J in Acquilina v Dairy Farmers Co-Operative Miik Co. Ltd. (No. 2), £19653 NSWR 772, where his Honour considered in detail the corresponding legislation of New South Wales. The intention of the Act is clearly enough to relieve a litigant from the burden of the costs of an appeal in a case where he has obtained a favourable decision but has lost it on appeal because the court below erred on a question of law; the purpose of the Act is not, however, to promote litigation, nor to provide legal aid in a broad sense out of the Fund: see per

Maguire J in Pataky v Utah Construction Pty. Ltad., £19663 1 NSWR 698; 84 WN (Pt. 1) (NSW) 201, at p. 208. It would be wrong for this

Court to say anything which could be taken as fettering the unfettered discretion given by the Act, but nevertheless it appears to us that in broad .-terms the Act is aimed at giving relief in cases where the decision turns on a question of law, as' contrasted -- with the facts of the particular case, where that question of ldw- might 'at. least-._. reasonably be resolved in different ways, so that in a sense the unsuccessful party may be thought to have suffered some 'misfortune' owing to a doubt about the correct rule of law to be applied."

In the present case the unsuccessful respondents are a trade union and its officers who persuaded-the Court to discharge an interim injunction and not grant an interlocutory injunction which would have had the effect of preventing them from trying to force carpet suppliers to cease contracting with the self-employed carpet-layers they had normally used, and to use only their own

employees - who would fof the most part have had to be engaged for

In the course of argument before the learned Judge hearing the application, counsel for the respondents persuaded his Honour not to follow a recent Full Court decision which had overturned a previous decision of his Honour's concerning the appropriate test to apply to applications for interlocutory injunctions. They urged his Honour to persist in his adherence to an earlier and apparently divergent line of authority. This was a bold submission but it was certainly not "a submission by a party

which should not have been made", to use the words of Winneke CJ

There is, however, a significant factor in the present case which points towards the exercise of the Court's discretion against the respondents. This is that the respondents obtained a positive advantage, and the applicants suffered a corresponding disadvantage, by reason of the erroneous decision of the Court hearing the application. Between the date of that judgment and the time when this Court was able to restore the position which had previously obtained, the respondents had a period of three weeks in which they were permitted to pursue their campaign against the applicants without fear of any legal sanction.

Another factor which, in our view, is relevant to the exercise of discretion is that the respondents elected to place no evidence before the Court hearing the application. They relied entirely upon arguments, first, that to obtain interlocutcr relief the applicants had to establish a probability that they would succeed in an ultimate hearing and, secondly, that their application disclosed no cause of action which, as a matter of law, would probably succeed. This course "involved an obvious

risk", to adopt the words of Dixon CJ in Gurnett v The Macquarie

Stevedoring Co. Pty. Ltd. (1956) 95 CLR 106 at 113, not unlike the

risk to which the Chief Justice was referring in that case, namely persuading a trial judge to take a plaintiff's case from the jury. In that case, which involved broadly similar NSW provisions for costs certificates, his Honour said,

the discretion of the Court to certify for the recoupment of costs out of a public fund."

So, in the present case, we can see no good reason why the taxpayer should be asked to subsidise the legal costs of litigants who, rather than put all their cards on the table, deliberately elected to rely upon legal arguments which -were clearly very debateable and, if successful, would be highly

For those reasons a costs certificate will be refused.

I certify that this and the six (6) preceding pages are a true and accurate copy of the Reasons for Judgment herein of The Court

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