Meaden v Bell Potter Securities Limited [2012] FCA 1394 | Case summary

REASONS FOR JUDGMENT 1 On 1 November 2012, I heard an application by the respondent that certain costs orders I had made in its favour be taxable and payable forthwith. Chronologically, these concerned costs orders made: (1) On 24 February 2011, ordering the first applicant to pay the respondent's costs of bringing a motion for orders that the first applicant provide the respondent with further and better particulars of her statement of claim previously requested in correspondence from the respondent's solicitors. (2) On 2 May 2012, ordering the first applicant to pay the respondent's costs of its application for an order under s 33N of the Federal Court of Australia Act 1976 (Cth) that the proceedings no longer continue as representative proceedings under Pt IVA of that Act. (3) On 1 November 2012, ordering the first applicant to pay the respondent's costs thrown away by the amendments to the statement of claim filed 6 October 2010 by reason of the filing of a further amended statement of claim foreshadowed in anterior orders made the same day. 2 In opposing the application, counsel for the first applicant referred me to an unreported judgment of Sackville J in Australian Agricultural Co Ltd v AMP Life Ltd [2003] FCA 1134 (17 October 2003) in which AMP sought a similar order under O 62 r 3 of the Federal Court Rules 1979 (Cth) ("FCR"), in particular under sub-r (2). At [12] of his Honour's reasons, reference was made to earlier decisions of single judges of the Court in the following terms: In Life Airbag Co of Australia Pty Ltd v Life Airbag Co (New Zealand) Ltd [1998] FCA 545, Branson J said this about FCR, O 62 r 3: "Order 62 rule 3 does not give any indication of the matters to which the Court is to have regard in determining whether to order that certain costs be paid forthwith notwithstanding that the proceeding is not concluded. Olney J in Thunderdome Racetiming and Scoring Pty Ltd v Dorian Industries Pty Ltd (1992) 36 FCR 297 at 312 expressed the view that - 'the discretion should be exercised in favour of a party who establishes that the demands of justice require that there be a departure from what appears to be the general practice envisaged by the rule, namely, that an order for costs of an interlocutory proceeding shall not entitle a party to have a bill of costs taxed until the principal proceeding in which the interlocutory order was made is concluded.' In Allstate Life Insurance Co v Australia & New Zealand Banking Group Limited (No 14) (Lindgren J, 18 August 1995, unreported) his Honour expressed the view that the provision of the Federal Court Rules allowing orders that costs be paid forthwith is 'possibly under utilised'. His Honour indicated that where the final determination of a proceeding was 'far away', it might be appropriate for use to be made of O 62 r 3. In Allstate Life Insurance Co v Australia & New Zealand Banking Group Limited (No 13) (Full Federal Court, 17 August 1995, unreported) the Court, in considering the costs of an interlocutory appeal, said: 'The litigation is complex. It is unlikely that final judgment will be given until late 1996 or even later. The successful parties to the appeals before this Court will therefore, in the ordinary course of events, not recover their costs for a long time. It would be wrong if the successful parties do not enjoy the fruits of their order for costs for such a long time. The parties entitled to the benefit of the order for costs which this Court has made in appeals from interlocutory orders should not be deprived of that benefit until the case has been finally disposed of.'" 3 In the course of opposing the respondent's application, counsel for the first applicant made the following points: (1) The applicants had agreed to give security for costs of the proceedings and a bank guarantee for $240,000 was to be handed over the following week. (2) All that I had determined to date was the most appropriate vehicle for the determination of the dispute, not that there was no cause of action for misleading or deceptive conduct or market manipulation. (3) The essence of the first applicant's case, as originally instituted, remains the essence of the case today; everything flows from the publication of the 10 company updates. 4 In conclusion counsel contended that nothing had been put by the respondent to displace the ordinary rule; nothing had been put which would require the demands of justice to go beyond what had already been ordered, namely, a costs order in the respondent's favour. 5 I agree with these submissions so far as the costs order of 24 February 2011 is concerned, namely that concerning the respondent's motion for further and better particulars of the first applicant's statement of claim. It is difficult to conceive how justice demands that this costs order should be the subject of the further order sought by the respondent. 6 The two remaining costs orders are not as easy of resolution. Counsel for the respondent put the following points in support of his application: (1) The respondent will likely be out of pocket for its costs for a very long time; the fact that there is, in the face of the order for security for costs, little or no risk that the costs will not ultimately be paid, is not to the point. (2) In response to the first applicant's point that all I had decided to date went to the appropriateness of the vehicle for determination of the dispute, the case as previously pressed has, in large part, been abandoned, so what is now left is a very small subset with a different group of people; what has happened to date is, in large part, redundant. (3) The presence of a litigation funder weighs on the respective interests of the respondent and the litigation funder as to who should be out of pocket pending the end of the proceedings. (4) Not only is what has happened largely redundant, but what is left is exclusive reliance on written representation which is entirely different from the case that was initially pressed. 7 I agree. 8 I am of the view that the respondent should not be out of pocket for the costs orders made in its favour on 2 May and 1 November 2012; justice demands that, in the circumstances to which I have referred, principally by way of the respondent's submissions, the further orders sought should be made save in respect of the costs order made on 24 February 2011. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds.

Meaden v Bell Potter Securities Limited

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