Queensland Racing Integrity Commission v Endresz; Racing Queensland Board v Endresz [No 2] [2024] QCA 123

1 cited instrument linked from this judgment.

What happened

These reasons deal only with costs after the Court of Appeal had decided the substantive appeals. The court directs readers to read this decision together with its earlier judgment, Queensland Racing Integrity Commission v Endresz; Racing Queensland Board v Endresz [2024] QCA 76, which dismissed appeals against a declaration that the Commission’s disqualification of a horse from its first placing in a race was void and of no effect (para 1).

The parties then made submissions about who should pay the costs of the appeals. The owners, Allan Paul Endresz, Ezybonds (Pacific), Jeffrey Simpson and Robyn Simpson, sought their costs. The Queensland Racing Integrity Commission and the Racing Queensland Board proposed a reduced order under which they would pay 60 per cent of the owners’ costs (para 2).

Their argument was that they had succeeded on a distinct and separable question: whether the Australian Rules of Racing gave the owners a right to appeal against the disqualification. Racing Queensland described this as a multi-faceted question. The Commission described the relevant matters as separate issues corresponding with grounds of its appeal. The practical result of either argument would have been to calculate costs by reference to the outcome on different issues, rather than simply by reference to the overall result (para 3).

The court rejected that proposed approach in the circumstances. It ordered the appellant in each appeal to pay the first four respondents’ costs of and incidental to that appeal. It also separately ordered the Commission to pay the first four respondents’ costs of and incidental to the Commission’s application in the appeal (para 6). The decision is therefore a costs ruling following the earlier substantive judgment, not a fresh determination of whether the disqualification was valid.

Why the court decided this way

The starting point was r 681 of the Uniform Civil Procedure Rules 1999 (Qld). The court stated that costs are discretionary but ordinarily follow the event (para 3). It then referred to the principle that the discretion must be exercised judicially and consistently with its purpose, and that costs generally follow the event unless special or exceptional circumstances warrant depriving a successful party of its costs (para 4). The court cited Orr v Director of Proceedings on Behalf of the Health Ombudsman [No 2] [2024] QCA 106 at [2], which in turn cited Courtney v Chalfen [2021] QCA 25, Speets Investment Pty Ltd v Bencol Pty Ltd (No 2) [2021] QCA 39, and Villan v The Body Corporate for The Winston (Cairns) Community Titles Scheme 37263 [No 2] [2024] QCA 54.

The issue was not whether the appellants had succeeded on the appeal-right question. The court accepted that they had. Rather, it was whether that success justified departing from the ordinary approach to costs by dividing the costs according to success on separate issues. The court treated the appellants’ argument as one that would make the owners’ costs depend on the results of distinct questions within the appeals, and noted that this approach would also raise the further question of what proportion of costs should be awarded (para 3).

The court accepted, for the purpose of assessing the submissions, that the appeal-right issue had importance for the racing industry and was of public interest. It also accepted that the appellants said the issues would have been more confined if the owners had not contested the appellants’ successful arguments. The Commission additionally relied on the fact that it was not motivated by financial gain (para 4).

Those points did not determine the costs question. The court assessed them alongside the circumstances of the dispute. It observed that an industry interest in authoritative resolution of the appeal-right question did not appear to favour requiring the owners to pay the costs incurred by the Commission and Racing Queensland, which regulate racing in Queensland (para 5). In other words, the court considered the public-interest submission, but did not treat it as a sufficient reason to shift costs to the owners.

The circumstances of the natural-justice claim were central. Referring to its earlier reasons, the court identified the conduct of the Commission’s stewards in keeping the owners “in the dark about an imminent adjudication by the stewards…in which the owners had a substantial interest” as the denial of natural justice (para 5, referring to [2024] QCA 76 at [71]). The owners had been left with no realistic alternative but to bring proceedings in the Trial Division and contest the appeals to vindicate their right to natural justice as a condition of a valid disqualification (para 5).

The court also considered the owners’ position on the separate appeal-right issue. Their arguments in the Trial Division had not been unreasonable, the primary judge had accepted them, and it could not be said to have been unreasonable for them to seek to uphold that part of the primary judge’s analysis on appeal. Although the appellants’ arguments on that question were ultimately accepted, the owners remained wholly successful in establishing their claimed right to natural justice (para 5). In that context, the appellants’ success on the appeal-right issue was, in the court’s words, a “Pyrrhic victory” (para 5).

The reasoning thus links the costs result to the character and overall outcome of the litigation. The court did not say that success on a separate issue can never affect costs. It concluded that, considering all the circumstances here, it was not appropriate to award costs according to the results on separable issues or to deprive the owners of any portion of their costs (para 6).

Before and after state of the law

This judgment does not purport to establish a new general costs regime. Its stated starting point is the existing discretion under r 681 of the Uniform Civil Procedure Rules 1999 (Qld), together with the ordinary principle that costs follow the event (paras 3–4). It also restates the qualification that a successful party may be deprived of costs where special or exceptional circumstances warrant it (para 4).

The decision’s practical contribution is its application of those principles to a proposed issue-based costs order. The Commission and Racing Queensland argued that their success on a distinct issue should reduce the owners’ costs recovery. The court considered that argument together with the owners’ overall success, the reason they had litigated, the reasonableness of their arguments on the issue the appellants won, and the public-interest submissions (paras 3–5). On those facts, it declined to apportion costs.

The reasons do not set out a comprehensive test for when costs should be divided by issue, nor do they identify a list of circumstances that will always justify or defeat apportionment. They record that the appellants sought costs allocated by issue and explain why that submission did not succeed in this case. Accordingly, the decision supports a fact-sensitive reading: issue-based success is a relevant argument, but the court assesses it against the full circumstances and the ordinary costs starting point.

The judgment also does not reconsider the substantive legal rules about natural justice or the Australian Rules of Racing. Those matters belong to the earlier judgment, [2024] QCA 76, which these costs reasons say should be read alongside this decision (para 1). For the present ruling, the earlier judgment’s identified finding about the owners being kept unaware of an imminent adjudication is relevant as context for the costs exercise (para 5).

Key passages with plain-English translation

At paragraph 3, the court says: “Costs are in the discretion of the Court but follow the event unless the Court orders otherwise.” In plain English, the court has power to decide costs, but the usual starting point is that the party who succeeds overall receives an order for costs. The phrase “unless the Court orders otherwise” recognises the discretion; it does not itself specify when a different order is justified.

At paragraph 4, the court states that costs “will generally follow the event unless there are special or exceptional circumstances which warrant depriving a successful party of its costs.” This is the formulation the court adopts from Orr and the authorities cited there. It places the burden of the costs argument in context: a party asking for a different result must persuade the court that the circumstances justify departing from the ordinary approach.

At paragraph 5, the court refers to the stewards keeping the owners “in the dark about an imminent adjudication by the stewards…in which the owners had a substantial interest.” The quotation comes from the earlier appeal decision, [2024] QCA 76 at [71]. In plain English, the present costs reasons treat the owners’ lack of notice of the impending adjudication as an important part of why they had to pursue the proceedings.

At paragraph 5, the court says the owners were left with “no realistic alternative” but to bring proceedings and contest the appeals to vindicate their right to natural justice. This explains why the court viewed the owners’ overall success as more significant than the appellants’ success on the separate appeal-right question.

Finally, the court calls the appellants’ success on that question a “Pyrrhic victory” in the context of the appeals (para 5). The phrase captures the court’s view that winning that issue did not alter the fact that the owners succeeded on the natural-justice claim that drove the litigation and remained wholly successful in establishing it.

What fact patterns trigger this precedent

The decision is most directly relevant to costs arguments after an appeal in which the successful party has won on the central or overall result, while the unsuccessful party has succeeded on one or more discrete issues. In this case, the appellants relied on success concerning whether the Australian Rules of Racing conferred a right of appeal, even though the owners remained successful on their claim that the disqualification process denied natural justice (paras 3–5).

It is also relevant where a party seeks to reduce the successful party’s costs by assigning costs separately to issues, rather than following the overall outcome. The judgment shows that such a submission may require attention to the relationship between the issue won and the litigation as a whole, the successful party’s position on that issue, and the circumstances that led to the proceedings. Here, the owners’ arguments on the appeal-right question were not unreasonable, and the primary judge had accepted them (para 5).

The public importance of the issue may also be raised in a costs argument. The court considered the appellants’ submission that an authoritative answer would be important to the racing industry and in the public interest. It did not treat that assertion, even accepted for the purpose of assessment, as decisive of costs. The court considered it with the fact that the appellants were regulatory bodies and with the owners’ success on natural justice (paras 4–5).

The decision should not be read as saying that these factors will always produce a full costs order for a successful party. The reasons are expressly tied to the circumstances before the court, and conclude that “in all of the circumstances” issue-based apportionment was not appropriate (para 6). The judgment does not provide a universal formula for allocating costs where parties win different issues.

How later courts have treated it

The provided judgment contains no information about how later courts have treated this costs decision. It therefore does not support claims about whether the decision has subsequently been followed, distinguished, or applied.

The authorities it identifies are earlier authorities, not later treatment of this decision. The court cites Orr [No 2] [2024] QCA 106 at [2], Courtney v Chalfen [2021] QCA 25, Speets Investment Pty Ltd v Bencol Pty Ltd (No 2) [2021] QCA 39, and Villan [No 2] [2024] QCA 54 in support of the general costs principle (para 4). It also refers to the earlier substantive decision in the same proceedings, [2024] QCA 76 (paras 1 and 5).

The judgment’s express relationship to those authorities is limited in the supplied text: they are cited for the proposition that costs generally follow the event unless special or exceptional circumstances warrant depriving a successful party of costs. The reasons do not set out the facts or detailed holdings of those cases, so this decision alone does not support a fuller account of their precedential scope.

Still-open questions

The reasons do not define when an issue is sufficiently distinct or separable to justify a separate costs order. They record the appellants’ characterisations of the appeal-right question but resolve the costs submission by weighing the circumstances overall (paras 3–6). The decision therefore leaves open how a court might approach a case where the successful party’s position on the separate issue was unreasonable, or where success on that issue materially changed the scope or cost of the litigation. Those examples are questions the judgment does not answer.

Nor does the decision specify how a court should calculate an appropriate percentage if it does decide to apportion costs by issue. Paragraph 3 observes that such an approach would raise a consequential question about the appropriate proportion of the owners’ costs. The court did not need to answer that question because it declined to apportion costs (paras 3 and 6).

The reasons also do not state whether the public importance of an issue will generally favour or oppose an issue-based costs order. They record that the appellants raised the importance of an authoritative resolution for the racing industry and that the court considered the point alongside the regulatory role of the appellants and the owners’ circumstances (paras 4–5). The conclusion is specific to that balance, rather than a general rule about public-interest litigation.

Finally, the present decision does not restate or analyse the full substantive reasoning on natural justice or the Australian Rules of Racing. It directs readers to the earlier decision, [2024] QCA 76, for the substantive appeal judgment (para 1). Any analysis of those issues beyond the limited account given in paragraph 5 would require that earlier judgment.

This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have it checked by a qualified Australian lawyer.