Ryan v Commissioner of Police, NSW Police Force

1. The applicant is to pay 80 percent of the respondents' costs to be agreed or taxed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ABRAHAM J: 1 This judgment relates to the issue of costs arising from the judgment of Ryan v Commissioner of Police (NSW Police Force) (No 2) [2021] FCA 106 which dismissed the applicant's application alleging discrimination under the Disability Discrimination Act 1992 (Cth) (DD Act). The applicant submitted, and the respondents did not challenge, that he is entitled to the costs of his successful application for leave to commence the discrimination proceedings. This judgment concerns the costs of the substantive hearing. 2 The principles regarding the award of costs are well established. Section 43 of the Federal Court of Australia Act 1976 (Cth) confers jurisdiction on the Court to award costs. Section 43 is broad, and the award of costs is discretionary: Foots v Southern Cross Mine Management Pty Ltd [2007] HCA 56; (2007) 234 CLR 52 at [25]; Gray v Richards (No 2) [2014] HCA 47; (2014) 89 ALJR 113 at [2]. That said, ordinarily, a successful party is entitled to an award of costs in its favour in the absence of special circumstances justifying some other order: see Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 at [11] (Ruddock v Vadarlis); Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at [67], [134]; Victoria v Sportsbet Pty Ltd (No 2) [2012] FCAFC 174 at [6]-[7]; Northern Territory v Sangare [2019] HCA 25, (2019) 265 CLR 164 at [24]-[25]. 3 Acknowledging those principles, the applicant contended that in the circumstances of this matter, he should not be ordered to pay the whole of the costs of the respondents of the substantive application given the respondents were unsuccessful with respect to a number of significant and separable issues raised in the proceedings. 4 In support of his position the applicant submitted that there may be a departure from the general position where circumstances make it reasonable or fair to do so, or where justice requires it: Ruddock v Vardarlis at [11]; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [5] (Bowen Investments); Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 271-272; EMI Songs Australia Pty Limited v Larrikin Music Publishing Pty Ltd [2011] FCAFC 92 at [9]. A departure may be justified where there has been mixed success on the issues, a successful party may then be awarded less than its costs or there may be an order apportioning costs: Les Laboratoires Servier v Apotex Pty Ltd [2016] FCAFC 27; (2016) 247 FCR 61 at [297]; H Lundbeck A/S v Alphapharm Pty Ltd (No 2) [2009] FCAFC 118 at [8]. The discretion of the Court will ultimately be guided by considerations of fairness between the parties: Bowen Investments at [3]-[5]. Separate costs order may be made where an otherwise successful party failed on matters that were either a dominant issue in contest or were separable: Beck v LW Furniture Consolidated (Aust) Pty Ltd [2012] NSWCA 76; (2012) 265 FLR 60 at [209]. A separable issue can relate to "any disputed question of fact or law" on which a party fails, notwithstanding that they are otherwise successful in terms of the ultimate outcome of the matter: James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [34]; Elite Protective Personnel Pty Ltd v Salmon (No 2) [2007] NSWCA 373 at [9]. The applicant submitted that a costs order in favour of a successful party can be ameliorated to reflect that party's failure on particular issues even if the successful party has not acted unreasonably in raising or defending those issues: Permanent Trustee Australia Ltd v FAI General Insurance Co Ltd (Supreme Court of New South Wales, Hodgson CJ in Eq, 3 June 1998, unreported, BC 9802305 at 10-11; Short v Crawley (No. 40) [2008] NSWSC 1302 at [32]; Corbett Court Pty Limited v Quasar Constructions (NSW) Pty Limited [2008] NSWSC 1423 at [25]-[32]; Dee-Tech Pty Limited & Anor v Neddam Holdings Pty Limited (No. 2) [2012] NSWSC 517 at [33]. 5 The applicant submitted that given the issues raised and the outcome, in the circumstances, the respondents should be awarded no more than in the region of 50 percent of their costs. 6 The applicant submitted that the employment issue was a discrete question and a "critical" issue in the proceedings. The issue raised complex questions of law and consumed a substantial part of both the written and oral submissions of the parties and of the judgment of the Court. The applicant correctly submitted that the issue is one of significance for police officers generally in New South Wales and for the Commissioner of Police and the State of New South Wales as employers and litigants beyond the circumstances of Mr Ryan's case. The applicant submitted it follows that it would be unreasonable or unfair for the applicant to be required to meet the costs of the parties in relation to that issue given that the respondents were unsuccessful. In relation to the other claims, the applicant submitted the respondents only abandoned their defence based on statutory authority in its written submissions filed three days prior to the trial. The applicant submitted that he had been required to consider that defence and address the operation of s 47 of the DD Act in written submissions. The respondents also pressed their submissions in relation to the operation of s 213 of the Police Act 1990 (NSW) and an unjustifiable hardship defence in final submissions, albeit not ultimately relying on s 213 of the Police Act as a defence. 7 The respondents took issue with that submission, and contended they were entitled to their costs. The respondents did not seek costs on an indemnity basis notwithstanding an offer made to the applicant prior to the hearing. It was submitted there was no basis to depart from the usual rule, particularly where the applicant has had the benefit of legal representation throughout the proceedings and was on notice as to the respondents' defence to the proceedings as early as November 2018, when the parties engaged in mediation, well prior to the leave hearing on 1 August 2019 and the substantive hearing in July 2020. It was submitted that the applicant knowingly commenced proceedings in this jurisdiction with the risk of an award of costs being made against him if the application was unsuccessful. The respondents further submitted that the applicant has the benefit of his lifetime pension upon medical retirement from the NSW Police Force and support from his employee representative body, the Police Association and that the respondents have incurred significant resources and expended public funds in defending a series of allegations which have not been made out. The respondents submitted that while the DD Act is beneficial legislation, it does not mean the Court should apply any different approach as to costs. Any suggestion that this Court's jurisdiction in human rights matters should be considered a "no costs jurisdiction" has been firmly rejected by the Court. It submitted that if, contrary to its submission, the Court were minded to apportion cost, the respondents were largely successfully, failing on one matter, being the issue of employment. The other matters relied on were said in the circumstances not to have had a relevant effect on the proceedings. The respondents submitted that in the event there is to be apportionment, the appropriate amount is that the respondents receive at least 80 percent of their costs. 8 I am mindful that case law reflects the breadth of the discretion to award costs, and that while there are cases both for and against apportionment, the court should exercise caution against "too ready a resort to apportionment according to issue based outcomes": New South Wales Lotteries Corporation Pty Ltd v Kuzmanovski (No 2) [2011] FCAFC 152 at [12]-[15], and see Doric Products Pty Ltd v Lockwood Security Products Pty Ltd [2002] FCA 282; (2002) 54 IPR 495 at [10]; Firebird Global Master Fund II Ltd v Republic of Nauru (No 2) [2015] HCA 53; (2015) 327 ALR 192; at [6]. Each case is fact specific. 9 The applicant's attempt to suggest that the costs should be no more than 50 percent elevates issues to a position that they did not have in the proceedings. I do not accept the submission. 10 The only issue on which the applicant succeeded was that of the "employment". It was a separate issue from those relating to the basis of the claims, and the only separate issue. It had not previously been addressed in relation to the DD Act. However, simply because it can be identified as a separate issue is not a basis, by itself, which necessarily should lead to an apportionment of costs. The applicant does not suggest that the respondents acted in any way unreasonably in challenging the issue. It was, as the applicant contends, a critical issue in the hearing, but that was because the applicant had to succeed on that issue before the Court could consider the substance of his claims. I accept, as the applicant contends, the conclusion is of potential significance to other police officers in New South Wales. However, it does not follow that it necessarily is "unreasonable and unfair" that the applicant meet the costs of that aspect of the submissions. The basis on which the applicant contends that to be so is unclear. 11 That said, a good deal of the hearing was directed to that aspect of the submissions. It is a topic which potentially had broader ramifications given the nature of the argument and the absence of direct authority. In those circumstances I am prepared to order apportionment in relation to that issue only. I order that the applicant is to pay 80 percent of the respondents' costs to be agreed or taxed. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Abraham.