Hepburn v Beauty Services Holdings Pty Ltd

REEVES J: 1 The pivotal question in this objection to the competency of Mr Hepburn's notice of appeal is whether the costs order to which his appeal is directed was an interlocutory or final order. If it was of the former kind, leave to appeal is required under s 24(1A) of the Federal Court of Australia Act 1976 (Cth) (Federal Court Act). 2 This question has arisen in the following procedural context. The costs order to which Mr Hepburn's notice of appeal is directed was made following an ex tempore decision delivered by a Federal Circuit Court Judge on 4 May 2018 (see Hepburn v Beauty Services Holdings Pty Ltd [2018] FCCA 1206). The proceeding before the Federal Circuit Court was commenced by Mr Hepburn in September 2017 relying upon the general protection provisions of Part 3-1 of the Fair Work Act 2009 (Cth). 3 On 9 February 2018, four days before a mediation was listed to occur, Mr Hepburn filed a notice of discontinuance of the proceeding. He was entitled to file such a notice under the provisions of r 13.01 of the Federal Circuit Court Rules 2001 (Cth). However, under r 13.02, Beauty Services Holdings Pty Ltd, as the respondent, was entitled to apply for costs of the proceedings. Following an application by Beauty Services to that effect, the Federal Circuit Court Judge made the costs order referred to above (the subject order). It was in the following terms: ORDERS (1) That the Applicant pay the Respondent's costs of and incidental to this application from the date the Respondent became aware of this application until the date of discontinuance (4.39pm on 9 February 2018) on an indemnity basis. (2) That in relation to this application for costs the Applicant pay costs on a party and party basis to be determined under Schedule 1 of Federal Circuit Court Rules 2001 (Cth) as assessed. IT IS NOTED: A. That the Court declares that the costs assessed in this matter be certified for counsel. 4 On 18 May 2018, Mr Hepburn made an attempt electronically to file an application for leave to appeal the subject order. If it had been accepted for filing, that application for leave to appeal would have complied with the 14 days' time limit in r 35.13 of the Federal Court Rules 2011 (Cth) (the Rules). As it happened, the registry of the Court rejected Mr Hepburn's application as incompetent, stating in an email: … [The Appellant] do[es] not need leave to file the notice of appeal as the orders made finalised the file. [The Appellant] should file a notice of appeal from the Federal Circuit Court. … 5 On 25 May 2018, acting on the indication received from the Court's registry, Mr Hepburn filed a notice of appeal with the Court. That notice complied with the time limit in r 36.03 of the Rules. It was the filing of that notice of appeal that provoked the present objection to competency under r 36.72 of the Rules. As alluded to at the outset of these reasons, the objection relies on the contention that the subject order was an interlocutory order and not a final order. 6 At a subsequent case management hearing of the appeal, orders were made in accordance with r 36.72(3) for the question of competency to be heard and determined before the hearing of the appeal. At the same case management hearing, Mr Hepburn was given leave to file any further application he wished to make with respect to the appeal. Acting on that leave, Mr Hepburn filed an application for leave to appeal on 2 August 2018. He did not include an application for an extension of time in that application, a matter which was discussed during the aforesaid case management hearing. 7 At the competency hearing, in brief summary, Mr Hepburn contended that the legal effect of the subject order was to finally dispose of his legal rights in the proceeding. In making this contention, he placed reliance upon, among other decisions, the judgment of Gibbs CJ in Carr v Finance Corporation of Australia Limited (1981) 147 CLR 246 (Carr) at 248. In response, Beauty Services also relied upon the decision in Carr and two decisions of the Full Court of this Court (National Mutual Life Association of Australasia Ltd v Grosvenor Hill (Qld) (2001) 183 ALR 700; [2001] FCA 237 (Grosvenor Hill) and Celand v Skycity Adelaide Pty Ltd (2017) 256 FCR 306; [2017] FCAFC 222) (Celand) to contend that the subject order was interlocutory in nature and therefore required leave to appeal under s 24(1A) of the Federal Court Act. 8 As Katzmann J pointed out in Hudson v Sigalla [2016] FCA 1204 (at [31]): There is some authority for the proposition that costs orders made as part of the final orders determining the rights of the parties in a proceeding are final, not interlocutory. In Probiotec Ltd v The University of Melbourne (2008) 166 FCR 30 at [79] Rares J (with whom Finn and Besanko JJ agreed) expressed the "prima facie" view that they were and in Les Laboratoires Servier v Apotex Pty Ltd [2016] FCAFC 27 at [291] another Full Court (Bennett, Besanko and Beach JJ) endorsed this view. 9 As her Honour noted above, in Probiotec Ltd v University of Melbourne (2008) 166 FCR 30; [2008] FCAFC 5 (Probiotec), Rares J expressed his view on "prima facie" basis. While the Court in Les Laboratoires Servier v Apotex Pty Ltd (2016) 247 FCR 61; [2016] FCAFC 27 (Apotex) did not advert to this "prima facie" qualification when it endorsed that view, it appears to have taken that qualification into account because it did not deal with the matter exclusively on that basis, but instead went on to state that: "… to the extent that leave is required, it is appropriate that it be granted …" (see at [291]). 10 For present purposes, it is also worth mentioning the immediately preceding paragraph in Apotex. There the Court listed a number of instances where leave to appeal a costs order "may be required". The first on that list was where: "the substantive proceeding was discontinued" (see at [290]). That was, of course, the circumstance in which the subject order was made (see at [3] above). 11 As has been noted above, Beauty Services cited two other decisions in support of its contention that the subject order was interlocutory in character. First, in Grosvenor Hill, a Full Court (Cooper, Whitlam & Tamberlin JJ) dealt with an appeal from an order staying a proceeding for want of prosecution. The Court outlined the general principles bearing on that issue and held that the order was interlocutory in nature (at [8]-[9]). The Court did not make any specific observations about costs orders so I do not consider that decision provides much assistance in determining the present issue. 12 However, the second decision does. In Celand, a Full Court (Logan, Bromberg and Charlesworth JJ) was required to consider a fixed sum costs order which was delivered with "elaborate reasons" some time after the primary judgment. Because an appeal had, by that time, been filed with respect to the primary judgment, that costs order was stayed pending the determination of the appeal (see at [66]). With respect to that costs order, the Court expressed the unqualified view (at [67]) that: "In our view, the costs order is interlocutory, not final in character. That is because it is not an order which finally disposes of the substantive rights of the parties: Sanofi v Parke Davis Pty Ltd (No 1) (1982) 149 CLR 147 at 153". 13 If it were necessary to reach a concluded view on this issue, given that the subject order was made after the proceeding had been discontinued and having regard to the unqualified conclusion reached in Celand (cf the qualified conclusions in Probiotec and Apotex above), I would have held that the subject order is interlocutory in character. In coming to this conclusion, I would have rejected Mr Hepburn's contention that the decision in Celand should be confined to its particular facts. However, I do not consider it is necessary to deal with this objection to competency on this basis. That is so because I consider it can be dealt with more justly and efficiently on the application for leave to appeal that Mr Hepburn subsequently filed (see at [6] above). 14 Turning to that application, it is convenient to record at the outset that Beauty Services is correct in pointing out that Mr Hepburn should have sought an extension of time in which to make his application for leave to appeal. However, since Ms Moody, for Beauty Services, quite properly conceded that her client would not suffer any prejudice if I were to treat the application for leave to appeal as if it included such an application, I will proceed to deal with the present application on that footing. 15 There is a broad discretion under r 35.14 to grant an extension of time to seek leave to appeal. The principles governing an application of that kind are well settled. They include the length of the delay, whether an acceptable explanation has been provided, the prejudice the other party may suffer if the extension is granted and the merits of the application for leave (see Pfizer Ireland Pharmaceuticals v Samsung Bioepis Au Pty Ltd [2017] FCA 573 at [4] per Nicholas J and the cases there cited). 16 With respect to the latter factor, the parties have agreed that the merits of the application for leave to appeal should be considered in conjunction with the hearing of the appeal. I will therefore deal with this application on that basis. As to the other factors, Mr Hepburn submitted that Beauty Services has been on notice that he wishes to pursue an appeal since approximately 25 May 2018 when he filed his notice of appeal. He also submitted that: he sought advice from the Court registry; he filed his original application for leave to appeal on 18 May 2018 within time; and, when that application was rejected, he filed his notice of appeal on 25 May 2018, within time. 17 For its part, Beauty Services did not point to any prejudice that it may suffer if an extension of time were granted. As well, it quite properly acknowledged that Mr Hepburn's dilemma essentially arose from the Court registry's decision to reject his original application for leave to appeal. 18 In all these circumstances, I consider it is in the interests of justice that Mr Hepburn be granted an extension of time to 2 August 2018 to file his application for leave to appeal. Accordingly, the orders will be that:

1. The time fixed by r 35.13 of the Federal Court Rules 2011 (Cth) for the filing of Mr Hepburn's application for leave to appeal be extended to 2 August 2018.
2. The costs of the objection to competency and of this application for extension of time are reserved to be considered in Mr Hepburn's application for leave to appeal or, if leave to appeal is granted, in the appeal. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Reeves.