GS Technology Pty Ltd v Secretary, Copyright Tribunal

REASONS FOR JUDGMENT 1 The applicant commenced proceedings in the Copyright Tribunal ("the Tribunal") under s 183 of the Copyright Act 1968 (Cth) ("the Copyright Act") against the State of Queensland ("the second respondent"). The Tribunal gave the applicant leave to withdraw the application on 15 August 1996 and ordered that the applicant file a notice of withdrawal in accordance with Regulation 38 of the Copyright Tribunal (Procedures) Regulations on or before 22 August 1996. The Tribunal made the following costs order : "Orders that the applicant pay to the respondent its costs of the application, such costs, in default of agreement, to be taxed by the Secretary to the Tribunal in accordance with the highest scale of costs applicable to actions brought in the Federal Court of Australia." 2 The costs were not agreed between the applicant and the second respondent. 3 The second respondent delivered a bill of costs in taxable form to which the applicant lodged a Notice of Objection on 14 October 1997. The bill was taxed on 20 October and 7 November 1997. The applicant was represented by its solicitor, or the solicitor's agent in Sydney, New South Wales on the taxation of the bill of costs. The costs were taxed at $18,059.70. A certificate of taxation was signed by the Secretary of the Tribunal, certifying to an amount of $18,059.70 on 2 December 1997. 4 On 24 December 1997 an application for an order for review under the Administrative Decisions (Judicial Review) Act 1977 (Cth) was filed in this Court. After a series of interlocutory applications as to parties and the competency of the application, the decisions for review were identified as the decision to order costs and the decision taxing and settling those costs on the taxation in the amount of $18,059.70. 5 On 24 March 1998 the applicant gave a notice of a constitutional matter under s 78B of the Judiciary Act 1903 (Cth). The applicant's contention was that s 174 of the Copyright Act to the extent to which it purports to confer judicial power on the Tribunal, was invalid as contrary to Chapter III of the Australian Constitution. 6 As a consequence of service of the notice, the Attorney-General of the Commonwealth intervened in the proceedings on 31 July 1998 in support of the validity of the legislation and was represented on the substantive hearing of the application by the Commonwealth Solicitor-General. 7 Section 174 of the Copyright Act provides : "174(1) The Tribunal may order that the costs of any proceedings before it incurred by any party, or a part of those costs, shall be paid by any other party and may tax or settle the amount of the costs to be so paid, or specify the manner in which they are to be taxed. (1A) In taxing or settling under subsection (1) the amount of the costs, or of a part of the costs, of any proceedings before the Tribunal incurred by a party, the Tribunal or the person or persons taxing or settling those costs, as the case may be, shall allow so much only of the amount as in the opinion of the Tribunal or the person or persons, as the case may be, would be allowed if the proceedings were proceedings before the Federal Court of Australia and the costs were taxed under the Federal Court Rules. (2) Costs directed by the Tribunal to be paid to a party may be recovered by that party in any court of competent jurisdiction. (2A) In any proceedings before a court under subsection (2) for the recovery of costs directed by the Tribunal to be paid to a party, a certificate signed by the Secretary to the Tribunal that states that the costs have been taxed or the amount of the costs has been settled and sets out the amount of the costs as so taxed or settled is prima facie evidence of the matters stated in the certificate." 8 The applicant submitted firstly, that s 174(1A) invests the whole of the judicial power of the Federal Court of Australia in relation to costs in the Secretary of the Copyright Tribunal. In my view the submission is erroneous. 9 On its proper construction s 174(1A) has three elements. They are : (i) that the costs being taxed or settled by the Tribunal or the person directed by the Tribunal to tax and settle the costs, have been incurred by a party; (ii) that the Tribunal or person doing the taxing form an opinion as to the amount which would have been allowed on taxation if the matter were one which had been conducted before the Federal Court of Australia and the costs of that proceeding had been taxed under the Federal Court Rules; (iii) that the Tribunal or person doing the taxing allow an amount for the costs incurred in a sum equal to the amount in respect of which the opinion is held. 10 The section does no more than require the Tribunal or person doing the taxation to form an opinion of an amount which an hypothetical taxation would produce of the matter in the Federal Court, if taxed in accordance with the Federal Court Rules. The Tribunal is not invested with, or required to exercise any power of the Federal Court or to decide any question of law or fact under the Federal Court Rules. The statutory requirement is to form an opinion of a monetary sum and to allow the claim for the costs incurred in the amount concluded upon the formation of the required opinion. 11 The source of the discretionary power in the Tribunal to award costs and the mechanism for taxing and settling those costs is contained solely in s 174 of the Copyright Act. It is not sourced in, nor a derivative of, the power of the Federal Court of Australia to award costs under s 43 of the Federal Court of Australia Act 1976 (Cth), nor the rules made under that Act relevant to the ordering, taxing, settling or enforcing of an order for costs made in proceedings in the Federal Court of Australia. 12 There is no substance in the applicant's first submission. 13 The applicant then submitted that the power to award costs was of its nature inherently judicial. This is so, the applicant submitted, because in its submission a power to award costs is a power to adjudicate a dispute about rights and obligations arising solely from the operation of the law on past events or conduct. So categorised, the power is essentially and exclusively a judicial power: Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 360 per Gaudron J; The Queen v Davison (1954) 90 CLR 353 at 373. 14 In my view it is not possible to characterise a power to award costs in this way. This follows because there is no common law right to award costs. The power to do so is always a statutory one: R v Scott (1993) 42 FCR 1 at 26 ff. The fact that a legislative power must be performed judicially as a proper incident of its exercise, does not necessarily mean that the power is judicial in character. How a power is treated by the legislation which creates the power may determine its character: The Queen v Davison at 369. The point was more recently made in Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 at 267 : "Difficulty arises in attempting to formulate a comprehensive definition of judicial power not so much because it consists of a number of factors as because the combination is not always the same. It is hard to point to any essential or constant characteristic. Moreover, there are functions which, when performed by a court, constitute the exercise of judicial power but, when performed by some other body, do not. These difficulties were recognised by the Court in Precision Data Holdings Ltd v Wills (1991) 173 CLR 167 at 188 - 189: The acknowledged difficulty, if not impossibility, of framing a definition of judicial power that is at once exclusive and exhaustive arises from the circumstances that many positive features which are essential to the exercise of the power are not by themselves conclusive of it. Thus, although the finding of facts and the making of value judgments, even the formation of an opinion as to the legal rights and obligations of parties, are common ingredients in the exercise of judicial power, they may also be elements in the exercise of administrative and legislative power.'" 15 In Stack v Commissioner of Patents [1999] FCA 148, the same argument as to the judicial nature of an award of costs was advanced as is now made, to deny the constitutional validity of s 210(d) of the Patents Act 1990 (Cth) under which the Commissioner of Patents is empowered to award costs against a party in proceedings before the Commissioner. Drummond J said (at paras 32 - 33) : "32. In my opinion, the true position is that statutory power to award costs in respect of proceedings before a decision-maker, judicial or administrative, takes its character from the principal power to which the power to award costs must always be ancillary: Cominos v Cominos (1972) 127 CLR 588 at 591 and cf R v Quinn [(1977) 138 CLR 1] at 10. 33. Whether costs are awarded by a court or some other body, the power to do that will necessarily be ancillary or incidental to some other power exercised by that Court or body. R v Quinn at 10 and Brandy at 267 show that the fact that the power or function to which the awarding of costs is ancillary may involve a determination after a contested hearing inter-parties is not sufficient of itself to stamp the exercise of the principle function as exclusively judicial because that principal power or foundation may be an administrative or even a legislative one. See also Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409 at 414." 16 I agree with this statement of principle. 17 The powers given to the Tribunal under s 183(5) to fix terms for the exploitation of copyright by the Crown in default of agreement between the Crown and the copyright holder is administrative in character, and the applicant did not submit otherwise. The exercise of the power creates new rights in the copyright holder and does not involve the application of the present law to past facts or conduct as an adjudication which is enforceable and binding on the parties of its own force. Nor is the power under s 174(1) or (1A) a power to adjudicate on a dispute by applying the present law to past facts or conduct. 18 As I have indicated earlier in these reasons, the only factual inquiry which the Tribunal, or the person conducting the taxation is required to make, is to satisfy itself, or him or herself, that the person claiming the costs has in fact incurred them. Beyond that the Tribunal or person taxing the bill is only required to form the requisite opinion and then to allow costs in accordance with that opinion. Once the costs are allowed, they are allowed only in the sense that the quantum of them is fixed. The enforceable right to receive the costs arises under s 174(2) of the Copyright Act. The costs are recoverable and are enforced by proceedings in a court of competent jurisdiction upon the exercise of judicial power by that court. 19 The power of the Tribunal to award costs under s 174 of the Copyright Act in respect of proceedings under s 183 of the Act, and the taxation of those costs, are in my opinion administrative in nature and are incidental to the principal power of the Tribunal which is itself administrative in nature. 20 The challenge to the decision under review on constitutional grounds fails. 21 The applicant next submitted that the decision was vitiated because reasons for the decision were requested on 10 December 1997 and not given. It was submitted that the Secretary was under a legal duty to provide reasons and that it was an error of law to fail to do so. It was contended that reasons were required by O 62 r 43 of the Federal Court Rules or by the decisions in Dornan v Riordan (1990) 95 ALR 451 and Muralidharan v Minister for Immigration and Ethnic Affairs (1996) 136 ALR 84. 22 Order 62 r 43 of the Federal Court Rules is concerned with the reconsideration of a taxation by a taxing officer of the Federal Court of Australia under those rules. Section 174(1A) of the Copyright Act does not require that the Secretary of the Tribunal tax under the Federal Court Rules or apply the Federal Court Rules mutatis mutandis to an exercise of the discretion under s 174(1A). In the circumstances of the present case, the applicant had no right under O 62 r 43 of the Federal Court Rules to be supplied with reasons for the Secretary's decision under review, particularly as there had been no reconsideration of the original taxation carried out under O 62 r 43. Similarly, the decisions of the Court referred to by the applicant do not establish such a duty in the Secretary to provide reasons to the applicant. 23 In each of the cases relied upon by the applicant the duty to provide reasons arose under an applicable statute. In Dornan the obligation was specifically provided for in s 98BD(1) of the National Health Act 1953 (Cth). In Muralidharan the obligation was contained in s 166E(1), (2) and (3) of the Migration Act 1958 (Cth). 24 The Copyright Act does not contain any statutory requirement which would impose a statutory duty on the Secretary to give reasons for his decision. Absent a statutory duty there is no common law duty to do so: Public Service Board of New South Wales v Osmond (1986) 159 CLR 656 at 662. 25 The applicant has not made any application under s 13 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) for reasons for the Secretary's decision on the taxation in respect of all or any of the amounts allowed and no argument was advanced by the applicant that the letter to the Secretary of 10 December 1997 constituted such a request. 26 Finally, the applicant sought to challenge the allowance of specific items in the bill of costs. Each of the items involved the taxing officer in forming an opinion as to what amount, if any, would have been allowed if the proceedings had been brought in the Federal Court and taxed in accordance with the Federal Court Rules. To succeed, the applicant must show that the formation of the opinion or its use miscarried for one or more of the grounds contained in s 6 of the Administrative Decisions (Judicial Review) Act 1977 (Cth). 27 The applicant firstly submitted that the Tribunal erred in allowing any costs in relation to contact between the second respondent's solicitors and the Queensland Treasury Corporation (QTC) in respect of items 55 to 58 and 101 to 103 in the bill of costs, when the QTC was not a party to the proceedings. In the proceedings before the Tribunal there were allegations of conduct on the part of QTC which were relevant to the applicant's claim against the second respondent. The marked up bill of costs in evidence on this application shows that claims 55 and 56 were allowed and items 57, 58 and 101 to 103 were disallowed. In these circumstances, without any reasons as to why items 55 and 56 were allowed which show demonstrable error, no basis is made out to interfere with this item. 28 The next item of complaint was the allowance of airfares for the attendance of senior and junior counsel on a directions hearing in Sydney. That was pre-eminently a matter for the discretion of a taxing officer. In this case no demonstrable error has been identified in the Secretary's opinion, that the outlays would be allowed on a taxation in the Federal Court. 29 The applicant objected to item 378 of the bill of costs. The marked bill bears an endorsement "not opposed". In any event, merely because a document was prepared and used in other proceedings does not mean that it is irrelevant to, and that its use may not involve additional costs in, the proceedings before the Tribunal. Again, no demonstrable error or ground for review is made out in respect of this item. 30 Finally, the applicant contended that all items after item 298 should be disallowed, being items bearing a date after 1 August 1996. This was the date upon which the applicant filed a notice of intention to withdraw the proceedings. The materials show that the applicant was not given leave to withdraw until 15 August 1996 and then was required to file a notice of withdrawal in proper form. Further, it is apparent that the refusal to accept the second respondent's solicitor's estimate of costs generated the bulk, if not all of the costs items after item 298 of the bill. The filing on 1 August 1996 of a notice of intention to withdraw the application did not leave the applicant free to contest outstanding unresolved issues without any adverse consequences as to costs. The Secretary has not been shown to have erred in allowing amounts for costs and outlays incurred by the second respondent, after 1 August 1996. 31 The applicant has failed to make out any reviewable error in the decisions under review. The application will be dismissed. 32 I turn to the question of costs. 33 The Commonwealth Solicitor-General submitted that the Commonwealth ought not to be at risk of costs because of its intervention and that the costs of the application should fall as between the parties to the proceedings. To treat the Commonwealth intervention as one not involving the Commonwealth in any risk for costs, which I think proper in the present case, carries with it as a matter of justice no expectation on the part of the Commonwealth to obtain the benefit of an order in any event. Accordingly, I make no order as to costs in favour of the Commonwealth. 34 The Secretary of the Tribunal appeared by solicitor as a submitting party who adopted the submissions of the Commonwealth on the constitutional issue. However, the applicant originally brought the proceedings against the Secretary and not the State of Queensland as the party having an interest in maintaining the order for costs. Until the intervention of the Attorney-General of the Commonwealth under s 78B of the Judiciary Act 1903 (Cth) on 31 July 1998, there was a legitimate, but limited role for the Secretary to take in the proceedings in support of the constitutionality of the provisions in issue: R v Australian Broadcasting Tribunal; ex parte Hardiman (1980) 144 CLR 13. Having lost on that issue, the applicant should pay the first respondent's costs of and incidental to the application up to and including 31 July 1998 and the costs of making a submitting appearance on 16 March 1999, such costs to be taxed if not agreed. Those costs are not to include the costs of the first respondent's objection to competency which I have previously heard and dealt with, and the costs of an application for security for costs which I was obliged to disqualify myself from hearing. 35 As to the second respondent's costs, the costs should follow the event, save for the costs of the outstanding application for security for costs brought by the second respondent. I certify that the preceding thirty-five (35) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Cooper.