Jele Chemists Pty Ltd v Australian Community Pharmacy Authority

1. The applicant pay the first respondent's costs to be assessed or agreed up to and including 29 March 2023.
2. The applicant pay the second respondent's costs to be assessed or agreed.
3. There be no costs order in respect of the third respondent.
4. Orders 1 and 2 do not operate to vary previous costs orders made by the Honourable Justice Collier on 30 November 2022. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

INTRODUCTION 1 In Jele Chemists Pty Ltd v Australian Community Pharmacy Authority [2023] FCA 1652 (judgment) on 21 December 2023, I made orders dismissing the Notice of Objection to Competency filed by the second respondent on 3 April 2023 and dismissing the further amended originating application filed on 29 March 2023. I also made orders as to the filing of submissions by the parties as to costs and proposed costs orders. Those submissions and proposed orders have now been filed. 2 These reasons dealing with the costs should be read with the judgement and adopt the abbreviations used in the judgement. That judgement sets out the full history of the matter, but for the purposes of these reasons, I note that the applicant made an application for an interlocutory injunction which was dismissed with costs on 30 November 2022 and the second respondent filed a notice of objection to competency as to the standing of the applicant on 3 April 2023. 3 The applicant's primary submission is that as a notice of appeal has been lodged against the whole of the judgement, the appropriate course to adopt is to postpone the resolution of the costs until the finalisation of the appeal. The notice of appeal also relates to orders made with regards to costs. According to the applicant's submission, for the parties to engage in a process of incurring additional costs, potentially unnecessarily, goes against ss 37M and 37N of the Federal Court of Australia Act 1976 (Cth), which sets out the overarching purpose of civil practice and procedural provisions and the obligations of parties to act consistently with that purpose. 4 In the alternative, the applicant submitted that if the Court is minded to make orders with respect to costs, those orders should be: 1. That the applicant pay the first respondent's costs up to and including 15 September 2022 as agreed or taxed (see Huon Aquaculture Group Ltd v Minister for the Environment (No 2) [2018] FCA 1938) 2. That the applicant pay the second respondent's costs as agreed or taxed; 3. That there be no costs order in respect of the third respondent. 4. Orders 1 and 2 do not operate to vary previous costs orders made in this application on 30 November 2022. 5 In its submissions in reply, the applicant's position with respect to the second respondent changed such that it contended that given the time devoted to the standing argument raised by the objection to competency, the applicant should pay two thirds of the second respondent's costs and the second respondent should pay one third of the applicant's costs. The applicant submitted that, therefore, the ultimate order as it relates to the second respondent should be that the applicant pay one third of its costs. 6 As to the first respondent's costs, the applicant, in its submissions in reply, argued that the first respondent cannot appear "in accordance with the Hardiman principle" then resile from that stance in order to seek that its costs be paid. 7 The second respondent submitted that its lack of success with regards to the objection to competency should not result in there being an order of "percentage reduction in the costs of the proceedings." The second respondent's submissions in this regard were based on the following arguments: Had the applicant responded appropriately to the second respondent's queries raised as to the question of standing prior to hearing, there would have been no need for the objection to competency; That the second respondent's argument about standing being described as compelling in the judgement meant that there was a "public importance in respect of the temporal element of standing and under ADJR Act;" In any case, the determination of the issue neither lengthened the hearing nor lead to a measurable increase in costs; The applicant unreasonably rejected the substantial "Calderbank offer" made two weeks after the dismissal of the application for interlocutory relief and before any further steps were taken within this Court. That would mean that the second respondent would be entitled to indemnity costs from 10 January 2023 which would then be the sum from which any reduction in costs would be made in respect of the notice of objection to competency; and The applicant and second respondent are competitors, and the application was made in relation to their commercial activities. It would not be appropriate for a costs order to advantage the successful applicant. 8 The applicant in reply asserted that its standing should never have been challenged given existing authority. Further, the applicant submitted, the Calderbank offer could not form a basis for indemnity costs, and in any case its refusal to accept the offer was not unreasonable at the time. 9 The first respondent's submissions were that, although the judgement found that it had appeared in accordance with the Hardiman principle: R v Australian Broadcasting Tribunal Ex parte Hardiman (1980) 144 CLR 13 at 35-36, this principle is one which should apply with flexibility depending upon the circumstances: Ogawa v Financial Information Commissioner [2014] FCA 229 at [23]; Metlife Insurance Ltd v Australian Financial Complaints Authority (No 3) [2022] FCA 849 at [12]. 10 Further, the first respondent submitted it has been held that the "Authority is not a Tribunal" by Katzmann J in Lo v Australian Community Pharmacy Authority [2013] FCA 639 at [73]. In this matter, the first respondent submitted that its involvement in the case assisted the Court to have a full understanding of the law: Fagan v Crimes Compensation Tribunal (1982) 150 CLR 666 at 681 - 682, and that it assisted the Court with respect to matters of construction, as is evident from paragraphs [81], [84], [88], [89], [91] and [102] of the judgement. Similar to Lo, its submissions were directed to questions of law, notwithstanding the presence in this matter of a contradictor. The first respondent argued that its position is further justified as, until the filing of the further amended originating application, it was "the proper or active contradictor." 11 The first respondent submitted that this put it in a position similar to one in which a submitting notice has been filed by the "natural contradictor", Further it submitted that no objection was taken by the applicant to the role it played, which weakens any submissions the applicant now might make as to costs: Freedom Pharmaceuticals Pty Ltd v Minister for Health (No 2) [2021] FCA 1250 at [11]. 12 Accordingly, the first respondent submitted that the applicant should pay its costs. 13 The applicant, in reply, submitted that payment of the first respondent's costs ought to be confined to the period up until the second respondent was joined as a party, that is 16 September 2022, and hence became a proper contradictor. The applicant submitted that Fagan, relied upon by the first respondent, arose out of different facts, namely that that matter had not taken place inter-partes, the Attorney General had not intervened to represent the public interest, and therefore it was appropriate for the Tribunal to appear and argue the case: Fagan per Brennan J at 681. 14 As to the first respondent's submission that it is not a Tribunal, the applicant submitted that to be irrelevant. Were the applicant to have been successful, or to be successful on appeal, the matter would be remitted to the first respondent, and the public interest in preserving the perception of impartiality on its part means it ought not be seen to be opposed to the appellant. 15 The third respondent does not seek its costs in the proceeding, having filed a submitting notice.