Plaintiff v Firstnamed Defendant Secondnamed Defendant Thirdnamed Defendant

2 There is now a dispute as to whether Mr Di Pietro, the subject of the telephone intercepts and who opposed the challenge to the Magistrate's decision, should meet the Commissioner's costs in this Court.

3 Mr Di Pietro was charged with trafficking in a commercial quantity of MDMA (ecstasy) contrary to s 302.2 of the Criminal Code (Cth) - an offence punishable by a maximum term of life imprisonment.

4 Shortly prior to the committal hearing (which commenced on 15 November 2010), a witness summons to the Commissioner was issued, at Mr Di Pietro's request, pursuant to s 43 of the Magistrates' Court Act.[1] The Commissioner objected to the production of the affidavits which supported the three telephone intercept warrants. The Magistrate dismissed the objection. [2]

5 The Commissioner then issued proceedings pursuant to Order 56 of the Supreme Court (General Civil Procedure) Rules seeking orders in the nature of certiorari. That application was entered in the Judicial Review and Appeals List of the Common Law Division of this Court. Mr Di Pietro was the contradictor and, through his counsel, argued at trial that the Magistrate's order should stand. Ultimately, I made orders quashing the Magistrate's decision and remitting the Commissioner's objection to the Magistrates' Court for further determination.[3]

6 The Commissioner argues that costs should follow the event: a successful party is entitled to an award of costs absent special circumstances which he says are not present in this case. The Commissioner submits that the rule of practice that the Crown would normally neither give nor receive costs in a criminal proceeding is inapplicable in this case: the Commissioner was not the prosecutor and the summons was issued to a person who was not a party to the criminal proceeding, related solely to the production of documents and not to questions of innocence or guilt of Mr Di Pietro.

7 The position taken by Mr Di Pietro is that there should be no order as to costs. He argues that the judicial review proceeding arose out of a criminal proceeding for a serious indictable offence. He contends that there should be no order as to costs given this was at heart a criminal proceeding. There is a public interest in not deterring a person accused of serious criminal offences from taking bona fide action (in the form of witness summons) to protect his or her position - this is particularly so where Mr Di Pietro is not entitled to an indemnity certificate under the Appeals Costs Act. It was said that if the same subpoena had been issued by Mr Di Pietro in the County Court in a trial of an indictable offence there would have been no entitlement to costs. Finally, it was submitted that there was a change in the manner in which the Commissioner's case was argued in this Court as opposed to the Magistrates' Court.

8 Section 24 of the Supreme Court Act 1986 (Vic) provides that:

(1) Unless otherwise expressly provided by this or any other Act or by the Rules, the costs of and incidental to all matters in the Court, including the administration of estates and trusts, is in the discretion of the Court and the Court has full power to determine by whom and to what extent the costs are to be paid.

(2) Nothing in this section alters the practice in any criminal proceeding.

9 In Perkins v County Court of Victoria,[4] Phillips JA said that:

...the characterisation of a "criminal cause or matter" came to depend not just upon the type of application giving rise directly to the order from which it was sought to appeal, but also upon the "underlying proceeding" which had led to the application.[5]

10 The subpoena directed towards the Commissioner at Mr Di Pietro's instance was patently part of the underlying criminal matter, Mr Di Pietro's alleged trafficking of drugs contrary to the Criminal Code (Cth). The purpose of the subpoena was, at least in relation to the affidavits, to endeavour to determine the legality or otherwise of the telephone intercepts upon which the Crown case relies. The proceeding in this Court is clearly one of a criminal nature.

11 Accordingly, s 24(2) may be engaged (and the jurisdiction of the Court to award costs under s 24(1) negated) if there is an applicable practice as to costs in a criminal proceeding which would inhibit such an award.

12 In Perkins, after an exhaustive and illuminating analysis of the authorities, Phillips JA concluded that if a rule of practice existed in the criminal jurisdiction, it was to the effect that the Crown neither gives nor receives costs:[6]

There is no doubt about the existence of the practice of granting no costs upon the trial of indictable offence: that practice is borne out every day.[7]

13 I will say a little more about that decision in a moment, but it suffices to say that it is clear that the rule of practice identified by Phillips JA, which may displace the operation of s 24(1) is confined to cases involving indictable offences to which the Crown is a party.

14 So, in a proceeding to which the Crown is not a party (as is the case here), a person the subject of a witness summons, whether the Commissioner or a citizen, is not precluded by any general rule from seeking costs in an application to this Court. Section 24(1) enables the Court to make a costs order and the general rule applies that, absent special circumstances, costs follow the event.[8]

15 I now turn to each of the contentions put on behalf of Mr Di Pietro in relation to why the general rule should not be applied.

Judicial review arising out of a criminal proceeding in the Magistrates' Court for a serious indictable offence

16 Mr Di Pietro argued that an accused person should be entitled to pursue the legality of a warrant without the prospect of an adverse costs order hanging over his or her head. Notwithstanding my conclusion that there was no basis for concluding that the AAT members issuing the warrants had been misled, it was said that the argument put was legitimate and this was not a case of vexatious or oppressive subpoena.

17 Many losing parties have a legitimate argument - on occasions that argument fails and an order for costs is made because the legitimate argument of the opposing party was preferred by the Court.

18 Once an application for judicial review was made, the prospect of an adverse order for costs being made against Mr Di Pietro crystallised and, as I discuss subsequently, should have been apparent to Mr Di Pietro and to his legal advisers.

19 In judicial review proceedings arising out of a criminal proceeding, the practice of awarding costs against an unsuccessful litigant (often the accused) is established;[9] there is no principle that in the context of a criminal prosecution a legitimate but unsuccessful argument of one party should deprive the successful party of its costs.

20 Mr Di Pietro contended that there was a public interest in not deterring persons accused of serious criminal offences from seeking to understand the nature and legality of the case which is brought against them. That proposition, as far as it goes, can be accepted.

21 However in this case, having requested that the Court issue the subpoena, and having obtained a number of documents determined to be within its ambit, it was Mr Di Pietro's choice to proceed with an argument which I have concluded was unsound and illogical. Mr Di Pietro was represented by solicitors and counsel of the highest calibre who understood the nature of the case against him, the legality of the case against him, the principles associated with attacking the telephone intercept warrants and importantly the risk of a Supreme Court challenge to the Magistrate's order. It was legitimate for them to persist with the argument before the Magistrate and then to argue that point in the hearing in this Court but, as I have said, they knowingly ran the risk of an adverse costs order.

22 Of course, there is a countervailing public interest, namely that a party wrongly brought to court is entitled to his or her costs, absent a persuasive reason to the contrary. In my view that consideration prevails in this case.

23 Mr Di Pietro is not entitled to a certificate under the Appeals Costs Act as he was not the respondent to an appeal in a civil proceeding: - because, as has been discussed, this proceeding is properly characterised as a criminal proceeding.[10] However, the inability to obtain a certificate, in my view, does not count for much in determining whether special circumstances have been demonstrated. The reality is that the legislature has chosen[11] not to permit the grant of indemnity certificates in matters not identified as "civil proceedings".

24 Undoubtedly, when the Commissioner persisted with his objection to the provision of the affidavits (many other matters having been sensibly compromised), counsel for Mr Di Pietro took into account the fact that should the Magistrate rule in Mr Di Pietro's favour, then there was always a risk that an order would be sought from a superior Court to quash the Magistrate's decision. It would also have been known to them that it was at the least, given the terms of the Act and the nature of the application, unlikely that an indemnity certificate could be obtained in the event the Commissioner was successful. The risk was always present that a successful challenge would result in an adverse costs order.

The decisions in Perkins and Atlas: subpoena in a trial on indictment

25 Mr Di Pietro submitted that if the same subpoena had been issued in a County Court proceeding in a trial on indictment, then the Commissioner would have no entitlement to costs.

26 The first observation to be made is self-evident: this was not a trial on indictment; it was a committal proceeding in the Magistrates' Court and involved the question of access to documents pursuant to a witness summons issued out of that Court.

27 It is now necessary to return to the decision in Perkins and to say something briefly about the background to the Court of Appeal decision. Mr Perkins was the defendant to summary offence charges in the Magistrates' Court. He was found guilty and appealed to the County Court - his appeal failed. He then brought judicial review proceedings in this Court naming the County Court and the two informants as respondents. The Crown was not a party to the appeal. At first instance, Harper J dismissed his application for judicial review and ordered costs against Mr Perkins, as did the Court of Appeal when his appeal failed.

28 In the Court of Appeal, Phillips JA set out the following propositions relevant to judicial review of an inferior court's decision in a criminal proceeding:-

(1) Section 24(1) of the Supreme Court Act 1986, which is the source in this case of the jurisdiction over costs exercised below, extends to this proceeding in the Trial Division for judicial review under O 56 in respect of the hearing and determination in the County Court of an appeal from the Magistrates' Court after conviction.

(2) The operation of s 24(1) to confer jurisdiction over costs is, however, subject to s 24(2) and this proceeding in the Trial Division is a criminal proceeding in the relevant sense, according to cases which, in the main, have considered the right of appeal in a criminal proceeding.

(3) Subsection (1) does not cease to apply to a proceeding which is a "criminal proceeding" within the meaning of sub-s (2). It operates still to confer jurisdiction over costs, but the jurisdiction must not be exercised otherwise than conformably with any relevant practice in criminal proceedings.

(4) The only practice relied upon by the appellant was that the Crown neither gives nor receives costs. That practice operates regularly upon the trial of indictable offences and probably in interlocutory proceedings relating to such trials, but query whether it has any application to a proceeding in which judicial review is sought under O 56.

(5) The practice relied upon has no application to the present proceedings because the Crown was not a party, nor did it intervene, at any level. The informant was not the Crown.

It follows that the appellant's submission that no order for costs should have been made in the Trial Division must be rejected. Harper J had jurisdiction to make such an order and no attack has been made upon the exercise of his discretion. Thus, for these reasons and for the reasons given by Buchanan JA I think that this appeal must be dismissed. It should be dismissed with costs. [12]

29 I have already adverted to a number of other aspects of the decision in Perkins to which these principles apply. The end result in that case demonstrates that the argument by analogy with the County Court trial is unpersuasive. Notwithstanding the position that may prevail in a trial on an indictment, the judge at first instance and the Court of Appeal ordered costs against Mr Perkins, the unsuccessful party in the judicial review proceeding.

30 Atlas v DPP & ors[13] involved a subpoena dispute which had arisen prior to the empanelment of a jury in a County Court trial. Judicial review of the County Court judge's ruling in relation to access to documents was sought by the accused to which the Director of Public Prosecutions and the subpoenaed party (the Director of Human Services) were parties.

31 After determining that certiorari should run in relation to the County Court judge's ruling, Bongiorno J said:

The conclusion numbered (4) of Phillips JA in Perkins v County Court of Victoria concerning costs in respect of interlocutory proceedings relating to trials on indictment probably precludes any order for costs in this case. However, I invite the parties to consider the matter and file written submissions on costs within seven days if they, or any of them, wish. In the absence of such submissions there will be no order as to costs.[14]

32 This observation does not assist Mr Di Pietro. In Atlas, in the guise of the DPP, the Crown was a party to the interlocutory proceeding which was the trial of an indictable offence. Moreover, Bongiorno J was not required to resolve the query posed by Phillips JA in conclusion (4) as to "whether it (the rule of practice) has any application to a proceeding in which judicial review is sought under Order 56".

33 In my view, there is nothing in the decision in Atlas which either precludes or counts against an order for costs being made in this case.

Difference in the case argued by the Commissioner in the Magistrates' Court

34 It was submitted that the point which ultimately succeeded was not articulated in the same way in the Magistrates' Court as it was in this Court and if it had been then the result below may have been different.

35 I reject this argument. A perusal of the written and oral submissions made by counsel for the Commissioner to the Magistrate makes it abundantly clear that counsel relied upon the following two propositions:-

(a) that "there is nothing to suggest that the warrant was improperly obtained"; and

(b) that the provisions of s 46A did not justify any inference being drawn adverse to the Commissioner[15].

36 It may well be that there was a different emphasis upon the matters before the Magistrate and before me, but the underlying point urged upon the Magistrate was that the evidence was insufficient to permit the Magistrate to infer that there was a reasonable possibility that the warrants had been obtained in bad faith. That was the case that was mounted in this Court.

37 The subpoena was issued by the Magistrates' Court at the request of Mr Di Pietro. The Commissioner's objection to the production of the documents was, on the material available to the Magistrate, well founded.

38 The Commissioner was entitled to make this application and was successful in this Court. Section 24(1) of the Supreme Court Act entitles the Court to make an award of costs and the general rule is applicable to such a case - as it was in Perkins at first instance. Nothing in the submissions of Mr Di Pietro, persuades me to depart from the general rule that the Commissioner should have his costs.

1. That the second defendant pay the Commissioner's costs.
2. Otherwise there be no order as to the costs of any other parties.

[1] See also r 24 of the Magistrates' Court Criminal Procedure Rules 2009.

[2] See [2011] VSC 3 [25]- [27].

[3] [2011] VSC 3.

[4] [2000] VSCA 171; (2000) 2 VR 246 - referred to as "Perkins".

[5] Ibid [15]; see also DPP v Hore (No 2) [2005] VSCA 55.

[7] Perkins [27], see also [40] set out below.

[8] Ritter v Godfrey [1920] 2 KB 47, 52-3, Donald Campbell & Co Ltd v Pollak [1927] All ER Rep 1 732, 809, 811, Kheirs Financial Services Pty Ltd & anor v Aussie Home Loans Pty Ltd & anor [2010] VSCA 355, [13] - [16].

[9] See Wright v Keon-Cohen; Danci v Duggan; Currie v Neesham (1992) 77 A Crim R 67, Perkins [27], Director of Public Prosecutions v Deeks (1994) 34 NSWLR 523, 535-536.

[10] Section 4 of the Appeal Costs Act.

[11] See DPP v Greelish (No 2) 5 VR 349 [8].

[13] [2001] VSC 209; (2001) 3 VR 211.

[14] [2001] VSC 209; (2001) 3 VR 211 [77].