[103] There are special considerations applying to indemnity cost orders against litigants in person, as the following authorities disclose.
[104] In Bhagat v Royal and Sun Alliance Life Assurance Australia Ltd, Hodgson CJ in Eq observed:
... I accept that a court does have to make allowances for the position of litigants in person, and to try to ensure that such a litigant does not lose out because of lack of expertise; although there is a limit to what the Court can do in that regard, while still remaining an impartial determinant of a dispute. The Court may in those circumstances refrain from making orders against litigants in person for conduct that might be considered as justifying orders for costs against represented litigants. By the same token, litigants in person can cause great hardship and expense to other parties, through making allegations and claims that lawyers would recognise as allegations and claims that could not reasonably or even properly be made, and through making proceedings much longer and much more expensive than they would otherwise be, by not focusing accurately on the real issues in the case. Conduct of that nature by legally represented parties would often lead to orders for indemnity costs. Litigants in person may escape the consequence of indemnity costs, but I do not think that the circumstance that a party is a litigant in person is a ground for displacing the ordinary result that costs follow the event.
[105] In Bhagat v Global Custodians Ltd, the Full Court of the Federal Court (constituted by O'Loughlin, Whitlam and Marshall JJ) observed Hodgson CJ in Eq did not say that litigants in person always escape the consequence of indemnity costs and declined to interfere with the decision of the trial judge to order indemnity costs against the unrepresented litigant. These judgments were cited with approval by Kenny J in Ogawa v The University of Melbourne (No 2).
[106] In Spalla v St George Motor Finance Ltd (No 8), Kenny J said:
From time to time the courts overcome their reluctance to order indemnity costs against a self-represented litigant: see, for example, Bhagat v Global Custodians and Ogawa v The University of Melbourne (No 2).
[107] Further in Salfinger v Niugini Mining (Australia) Pty Ltd (No 4), Heerey J said as follows:
In Spalla v St George Motor Finance Ltd (No 8), Kenny J recently noted that courts have from time to time overcome a reluctance to order indemnity costs against self-represented litigants: Bhagat v Global Custodians and Ogawa v The University of Melbourne (No 2). Kenny J considered the competing interests in determining whether to make an award of indemnity costs against a self-represented litigant. A lack of knowledge of the law, unfamiliarity with court practice and a lack of objectivity are common traits of unrepresented litigants. A person's ability to redress should not depend on lawyerly skills or an ability to pay for legal representation. However, the Court owes a duty to all parties to ensure that the trial is conducted in a fair and timely fashion and without significant difficulties and unnecessary expense for the parties against whom an unrepresented litigant proceeds: see Bhagat v Royal and Sun Alliance Life Assurance Australia. In this instance the expense, delay and difficulties caused by the applicant's fraudulent and unreasonable behaviour overshadow any limitations that arose from his status as self-represented.