Telstra Corporation Limited v Australian Competition Tribunal

REASONS FOR JUDGMENT 1 On 11 March 2009, the Court published reasons and made orders in this matter: Telstra Corporation Limited v Australian Competition Tribunal [2009] FCAFC 23. 2 Included within the orders made by the Court on that occasion was the following order: THE COURT ORDERS THAT: … 2. The second to seventh respondents pay the applicant's costs of and incidental to the application. 3 When the orders of the Court were announced on 11 March 2009, the second to seventh respondents (the Chime respondents) requested that the entry of the order for costs extracted at [2] above be deferred so that those respondents might apply to the Court to vary that costs order. The Court acceded to that application and ordered that entry of the above costs order be deferred until 20 March 2009. The Court also directed that the parties exchange and file Written Submissions directed to the question of costs. 4 The parties have complied with the Court's directions and Written Submissions have been exchanged and filed. 5 In their Written Submissions, the Chime respondents submitted that the order for costs made by the Court on 11 March 2009 should be varied. Those respondents have put forward three different proposals. In descending order of preference, those proposals are that: (a) There be no order as to the costs of the Application; or (b) The costs of the Application be reserved pending the outcome of the further hearing before the Tribunal; or (c) The order for costs which is ultimately made should reflect the circumstance that the applicant (Telstra) did not achieve complete success on all of the grounds raised by it and that Telstra would have had to bring the proceeding in any event. The Chime respondents submitted that an appropriate order would be that Telstra receive one-third of its costs. 6 In its Written Submissions, Telstra submitted that the Chime respondents had failed to make out a case for re-opening the question of costs. Alternatively, were the Court minded to re-open the question of costs, Telstra submitted that the existing order should stand. 7 In the reasons published on 11 March 2009 (Telstra Corporation Limited [2009] FCAFC 23), at [293] we said: 293 For all of the above reasons, we think that the Tribunal's decision must be set aside and the matter remitted to the Tribunal to be decided according to law. Although Telstra has not succeeded on every point which it argued, it has succeeded in overturning the Tribunal's decision. We think that, in those circumstances, the second to seventh respondents should pay Telstra's costs of and incidental to the application before us. 8 Having read and considered the parties' Written Submissions, we see no reason to vary the costs order which we have already made. 9 Our reasons for this decision may be shortly stated as follows: (a) The ordinary course of events in this Court is that costs will be dealt with, one way or the other, at the time when judgment is delivered. The exception to this ordinary course is where some specific arrangement or request in respect of costs is made at or before the hearing (Australian Competition and Consumer Commission v Daniels Corporation Pty Ltd [2001] FCA 936 at [9] and at [17]); (b) It is wasteful for the Court to be obliged to consider argument on matters which could have been put at the hearing. The Court is entitled to assume that parties have nothing to say about costs if they have not specifically dealt with that subject at the hearing (Australian Competition and Consumer Commission v Daniels Corporation Pty Ltd [2001] FCA 936 at [11]); (c) In the present case, no party requested that the question of costs be deferred nor were specific submissions addressed to the question of costs; and (d) In any event, the submissions advanced by the Chime respondents in support of the position which they now wish to take in respect of costs are, in our view, without merit. 10 The reasons set out in subpars (a) to (c) of [9] above are sufficient to dispose of the present application. No explanation has been proffered by the Chime respondents as to why they did not seek special provision in respect of costs at the hearing of the Application and no satisfactory reason has been advanced by those respondents which would justify a departure from the ordinary rules. 11 We will nonetheless make a few observations about the submissions advanced by the Chime respondents in support of the variations which they have sought. These observations will provide a brief explanation as to why we reject those submissions on the merits. 12 The Chime respondents submitted that: (a) It would not be "just and reasonable" to make an order for costs against them because: (i) it was Telstra who had commenced the process which ended up in the judicial review application before the Court; (ii) the Chime respondents had had success in the Tribunal (a no costs jurisdiction); and (iii) the Chime respondents may repeat their success when the matter is reconsidered by the Tribunal; (b) It was the Tribunal which made the errors, not the Chime respondents. The errors on the part of the Tribunal inevitably meant that Telstra would be required to bring the current application with the consequence that the Chime respondents should not be required to pay the costs which Telstra would have had to incur in any event; and (c) Telstra did not succeed on all grounds. For that reason, there should be a costs order which apportions costs across each ground of review separately with the successful party on each ground being awarded the costs referable to that ground. 13 Telstra has taken issue with all of these submissions. 14 In our view, Telstra has substantially succeeded in the application which it brought in this Court. Whilst it may be recognised that it did not succeed on every ground which it argued, many of those grounds overlapped with other grounds on which it did succeed and, in any event, it ultimately succeeded in having the Tribunal's decision set aside. Telstra's aim in bringing its application in this Court was to have the Tribunal's decision set aside and to require the Tribunal to reconsider its exemption applications. It achieved this aim. 15 In our view, this is not a case where it is appropriate for the Court to apportion costs against individual issues. To do so would involve a nit-picking exercise which would obscure and ignore the ultimate result - the setting aside of the Tribunal's decision and a remitter of Telstra's exemption applications to the Tribunal for further consideration according to law. This is what Telstra achieved and this was as much as it could have achieved. The fact that it did not establish each and every ground for the relief which it claimed is neither here nor there. The simple fact is that the relief granted by us was all that Telstra sought and all that it could have achieved by bringing its judicial review proceedings. In our view, the hearing was not unduly prolonged or made significantly more expensive by the need to deal with the grounds of review upon which Telstra did not succeed. 16 Further, it was the Chime respondents who persuaded the Tribunal that it could not properly proceed to make the exemption orders which Telstra had sought in the absence of empirical evidence as to the current state of competition in the relevant markets. That submission found favour with the Tribunal and was at the heart of the Tribunal's decision. We have held that the reasoning adopted by the Tribunal in this regard was erroneous. The Chime respondents must accept a large measure of responsibility for the approach which the Tribunal took. In addition, the Chime respondents did not adopt in this Court a neutral position or a position which supported Telstra's application but, rather, strenuously opposed the relief which Telstra sought. 17 Telstra was entitled to seek the exemption orders which it claimed. The Chime respondents were entitled to pursue their best interests by opposing Telstra's applications for exemption both before the ACCC and in the Tribunal. Once the matter came to this Court, the Chime respondents had a clear choice - take a neutral or even a supportive position and not be at risk as to costs or take a contradictory position and be at risk as to costs should Telstra's application succeed. The Chime respondents chose the latter course. That choice may well have been commercially rational and understandable but inevitably it put those respondents at risk as to costs in respect of Telstra's application in this Court. The Chime respondents opposed the relief sought by Telstra. That relief was granted. The normal rule that costs follow the event should apply. 18 For the above reasons, we remain of the view that the Chime respondents should pay Telstra's costs of and incidental to the Application. We wish to make clear that those costs should include the costs occasioned by the Chime respondents' application to vary the costs order which was made on 11 March 2009. 19 Accordingly, the application made by the Chime respondents to vary the costs order which we made on 11 March 2009 is refused. I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Jacobson, Lander and Foster.