Costs in relation to the permanent stay orders
9 Mr Perera notes that Full Court upheld the orders of the primary judge staying the Perera and McTaggart Proceedings on a different basis to that which the primary judge identified. The Full Court did not accept that the Perera and McTaggart Proceedings were an abuse of process, did not endorse his Honour's reliance on the equitable doctrine of bills of peace, did not accept his Honour's alternative invocation of de-classing under s 33N, and doubted (though did not decide) whether s 33ZF permitted the grant of a permanent stay. The Full Court said that the position was, in truth, one where the GetSwift respondents or Mr Webb should have filed a notice of contention to the effect that the primary judge had power to grant the relief granted on case management grounds even absent establishing abuse of process.
10 Mr Perera therefore argues that it is appropriate to apportion costs on a per issue basis as was done, for example, in New South Wales v Nominal Defendant [2005] NSWCA 213. He says that he had some success on Grounds 3, 4-5 and 6-8, each of which challenged the juridical basis upon which the primary judge had ordered the permanent stay. He argues that the proper costs order would involve some downward adjustment to the costs ordered to be paid to the GetSwift respondents and Mr Webb to reflect the fact that while they obtained the result for which they contended, it was on a different basis.
11 Alternatively, Mr Perera says that if the Court is minded simply to order that costs should follow the event, the order should take into account that the GetSwift respondents and Mr Webb incurred their costs in appeals in both the Perera Proceeding and the McTaggart Proceeding. He says the appropriate order is that Mr Perera pay 50% of the GetSwift respondents' and Mr Webb's costs of the appeals, and that the McTaggart appellants pay the other 50%.
12 For their part the McTaggart appellants argue there should be no order that they pay the costs of the GetSwift respondents and Mr Webb. They also note that although the Full Court dismissed the appeal, it determined (at [123]) that the source of the power to order a permanent stay of the Perera and McTaggart Proceedings was the Court's express and implied power to manage cases before it, not to prevent abuses of process.
13 They submit that the applications concern a case management decision made following a selection process instigated by the primary judge, which was "novel", "complex, elaborate and expensive" and able "to be dealt with less elaborately and more efficiently" in the future. They note the Full Court estimated costs incurred by the unsuccessful funders were "in the order of $300,000-$500,000" each, and its view that "losses of that magnitude are likely to prove unsustainable over the medium to long term". The result would be that some funders may withdraw from the funding market, which will have the undesirable effect of reducing competition between funders (at [282]). They say that Vannin has actually spent well more than $500,000 on their proceeding to date and that Vannin should not be visited with an order to pay costs as that will act as a further disincentive to Vannin (and other funders) considering funding the investigation and prosecution of other class actions. They say that would not be in the interests of group members; nor would it promote access to justice.
14 The McTaggart appellants also contend that the applications raised important matters of principle in relation to how the Court should deal with competing class actions, and note that the Full Court used them as an opportunity to provide general guidance for docket judges on the management of such cases. They say that the Full Court accepted many of the submissions they made on matters of general utility and policy, and it rejected some of the submissions made by the GetSwift respondents and Mr Webb. In reliance on Ruddock v Vardarlis (No 2) (2001) 115 FCR 229 at [17] (Black CJ, Beaumont and French JJ) they argue that the Court should therefore decline to order costs against them.
15 Finally, they argue that the appeal was successful in so far as it related to the personal claims of the McTaggart appellants.
16 We do not accept these contentions.
17 We commence by noting that the discretion as to costs is a broad one which is relevantly unfettered, save for the requirement to act judicially and to ensure that any power to award costs is exercised in the way that best promotes the overarching purpose in s 37M of the Act. There is no absolute rule that costs follow the event and an award of costs is discretionary, but generally that discretion is exercised in favour of the successful party: Foots v Southern Cross Mine Management Pty Ltd (2007) 234 CLR 52 at 62-63 [25] (Gleeson CJ, Gummow, Hayne and Crennan JJ); Oshlack v Richmond River Council (1998) 193 CLR 72 at 88-89 [40]-[41] (Gaudron and Gummow JJ). In the circumstances of the present case in relation to the appeals against the permanent stay orders we consider costs should follow the event.
18 First, the appeals centrally concerned whether the circumstance of the three competing open shareholder class actions warranted the primary judge's imposition of permanent stays in respect of two of them. The GetSwift respondents and Mr Webb were wholly successful in maintaining the primary judge's orders in that regard. More particularly, the key issues in the appeals were: (a) whether the Court had power to stay the Perera and McTaggart Proceedings respectively; and (b) if so whether the primary judge's exercise of the power miscarried. The GetSwift respondents and Mr Webb were successful on both of those issues, and the Full Court rejected the many grounds of appeal.
19 While the Full Court did not accept that competing class actions such as the Perera and McTaggart Proceedings constitute an abuse of process, and it took a different view as to the source of the power to permanently stay a competing open class action, the fact remains that the permanent stay orders were upheld. It is relevant too that Mr Perera conceded that much the same result as a permanent stay for abuse of process could be achieved by using other tools available to the Court, and that was the result in the appeals.
20 Second, the fact that the Full Court took a different view to the primary judge on some issues does not carry much significance when the GetSwift respondents and Mr Webb were wholly successful on the key issues. The primary judge dealt with the power to stay a competing class action in a novel context and in a wide-ranging judgment that considered a number of issues (such as bills of peace, s 33ZF of the Act and de-classing proceedings under s 33N) on which his Honour did not ultimately rely for the conclusion that it was appropriate to order a permanent stay. While the Full Court took a different view to the primary judge on those issues they were not essential to the primary judge's decision, nor crucial to ours.
21 It is also relevant that the Full Court took the opportunity to provide some general guidance for docket judges dealing with competing class actions and on questions of policy when these matters were not central in the hearing or the decision.
22 Third, we accept that ordering costs against the unsuccessful funders of the Perera and McTaggart Proceedings will increase their losses in circumstances where (as we said at [282]) there is already a risk that the substantial costs of involvement in such a case selection process may force funders out of the market. Such an outcome is undesirable because it will reduce access to justice and may lead to higher funding charges. However, it is also undesirable that the GetSwift respondents and Mr Webb should have to meet their own costs of the appeal.
23 The primary judge was required to decide the best way to deal with the case management difficulties that were thrown up by three competing open class actions and his Honour made a discretionary case selection decision which took into account all the circumstances of the case and involved weighing up a number of incommensurable and conflicting considerations, in relation to which there could be no one right answer. The Webb Proceeding came out on top in that process. Notwithstanding the relatively high bar that is appropriate on appeals from discretionary decisions on practice and procedure, the Perera appellant and McTaggart appellants commenced applications for leave to appeal. These were always going to be difficult and were ultimately unsuccessful. The GetSwift respondents and Mr Webb should not be forced to carry their own costs of the applications.
24 Fourth, there is no force in the contention that the McTaggart appellants should not pay costs because their appeal was successful in so far as it related to their personal claims. It is not clear that the orders of the primary judge operated to stay their personal claims. Further, before us no party sought to argue that they should be stayed and this issue took up little or no time.
25 Finally, we note that the two applications for leave to appeal against the permanent stay orders raised essentially the same issues. The GetSwift respondents provided one set of submissions in respect of the appeals and the issues in those appeals were dealt with indivisibly in the hearing and in the Full Court's reasons. There was also substantial crossover in Mr Webb's submissions in relation to the two cases. It would be unrealistic and artificial for a taxing officer to have to divide up costs as though they were incurred in one of the two applications as opposed to another. We consider that Mr Perera and the McTaggart appellants should each pay 50% of the GetSwift respondents' and Mr Webb's party/party costs. We have not, however, made an order in those terms because the Perera and McTaggart appellants should be jointly and severally liable so as to ensure that the GetSwift respondents and Mr Webb recover their costs even if one of the appellants is unable to pay. It is, of course, impermissible for the GetSwift respondents or Mr Webb to make "double recovery" of their costs.