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[2012] FCAFC 174
appellant. In each appeal the appeal is allowed; Sportsbet and Eureka to pay the costs of the State, Tabcorp and the VCGLR of the appeals and (subject to one existing order) of the proceeding at first...
The Full Federal Court rejected Sportsbet's attempts to reduce the costs it had to pay after losing appeals about Victorian betting laws. The judges said that losing one argument about whether transactions were in trade and commerce did not justify cutting the bill because the point had been reasonably run. Tabcorp, which had started as an intervener and was joined later, still got its full costs because once joined it was a full party, its commercial interests differed from the State's, and the arguments did not overlap too much. Sportsbet had never objected to Tabcorp running its own case before the hearing so it could not complain later. Tabcorp was also allowed its costs from the day Sportsbet first raised new claims against it in December 2010, not the later joinder date, because the trial was imminent and Tabcorp had to start preparing immediately to be ready. The Court emphasised that costs rules look at the substance of what was fairly done to conduct the case, not the exact calendar date of formal joinder.
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2,354 words · generated 24/04/2026
3 cited instruments linked from this judgment.
The substantive appeals in VID 1000 of 2011 and VID 1002 of 2011 were allowed on 12 October 2012. The Full Court (Emmett, Kenny and Middleton JJ) held that certain Victorian provisions regulating betting did not impermissibly burden interstate trade and commerce. Directions were then given for short minutes of orders. Disagreement arose solely on costs. The State of Victoria and Tabcorp Holdings Limited sought orders that Sportsbet Pty Ltd and Eureka Hotel Holdings Pty Ltd pay their costs of both the appeals and the proceeding at first instance (VID 808 of 2010). They also sought to vary the primary judge's costs orders so that Sportsbet and Eureka would pay the Victorian Commission for Gambling and Liquor Regulation's costs and the balance of Tabcorp's costs from 22 December 2010.
Sportsbet proposed a discounted liability: 80 per cent of the State's costs, 25 per cent of Tabcorp's first-instance costs, and no order as between Tabcorp and Sportsbet on the appeal. Eureka filed no separate submissions. The central complaints were that the appellants had failed on the trade-and-commerce issue, that there had been significant overlap between the State's and Tabcorp's submissions, and that Tabcorp's earlier status as a conditional intervener and the timing of its joinder warranted reduction. Tabcorp countered that it should recover costs from the date the Reply was filed (22 December 2010) because that pleading first introduced allegations directly affecting its fixed-odds approval and necessitated immediate preparatory steps ahead of the already-fixed April 2011 trial date.
The judgment, delivered on the papers, rejected every proposed discount. Orders were made allowing both appeals, substituting the VCGLR as fourth respondent, dismissing the amended application below, and requiring Sportsbet and Eureka to pay the costs of the State, Tabcorp and the VCGLR on the appeals and (with one limited exception) at first instance. Tabcorp's first-instance costs were ordered from 22 December 2010 rather than the formal joinder date of 3 March 2011. The reasons comprise only 16 paragraphs yet traverse the full discretionary landscape.
The Court began from the orthodox position that a successful party is entitled to its costs: Oshlack v Richmond River Council (1998) 193 CLR 72 at 97 [67] and 120-122 [134] and Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 237 [16]. Because the State and Tabcorp had succeeded on both appeals and obtained dismissal of the amended application, they were prima facie entitled to all costs unless Sportsbet demonstrated good reason to depart.
On the trade-and-commerce issue the Court accepted that it had occupied significant time at trial and on appeal. The primary judge had noted that a substantial part of the respondents' case addressed whether Sportsbet conducted business in and out of Victoria. Nevertheless, the Court held that failure on one argument does not justify issue-by-issue costs where the issue was not unreasonably raised and the party remained wholly successful overall. Nothing in the materials suggested the point was frivolous or extraneous. The Court cited Tomanovic v Global Mortgage Equity Corporation Pty Ltd (No 2) (2011) 288 ALR 385 at 402-403 [99]-[100] for the proposition that costs discretion is not engaged merely by partial forensic failure.
Sportsbet's second complaint concerned Tabcorp's separate representation. The Court first disposed of any lingering effect of Tabcorp's initial intervener status. Once joined under O 6 r 8 of the former Rules (and later r 9.05(1) of the 2011 Rules), Tabcorp became a full party with all rights and obligations, including the right to appeal and to seek costs: Forestry Tasmania v Brown (No 2) (2007) 159 FCR 467 at 470 [12]. Prior procedural history could not diminish that status. The Court endorsed the principle from Symphony Group PLC v Hodgson [1994] QB 179 at 193 that a joined party is treated as any other litigant.
On overlap, the Court found as a fact that there had been no undue duplication. The State advanced public-interest regulatory considerations while Tabcorp protected distinct commercial interests. Both sets of counsel had "evidently sought to eschew the unnecessary duplication of submissions". Critically, Sportsbet had taken no pre-hearing step to confine Tabcorp's role or to challenge its separate representation. Relying on Credit Lyonnais Australia Ltd v Darling (1991) 5 ACSR 703 at 710 and Re Octaviar Ltd (No 8) [2010] QCA 57 at [3]-[5], the Court held it was too late to complain after the event. The separate conduct had been reasonable having regard to the different interests: Statham v Shephard (No 2) (1974) 23 FLR 244 at 246-247.
The final question was the start date for Tabcorp's first-instance costs. The Court accepted that the Reply filed on 22 December 2010 first raised the fixed-odds allegations that made Tabcorp's joinder necessary. The trial date had already been fixed for 11 April 2011; pleadings were closed and evidence deadlines loomed. The primary judge had expressly considered the urgency when granting joinder: Sportsbet Pty Ltd v The State of Victoria [2011] FCA 170 at [20]. The Full Court concluded that Tabcorp had to conduct itself as though joined from that date or it could not have complied with the short post-joinder timetable.
The legal foundation was the definition of party-and-party costs in sch 1 to the Federal Court Rules 2011 (Cth) as costs "fairly and reasonably incurred by the party in the conduct of the litigation". This replaced the former "necessary or proper" test in O 62 r 19 but was not construed as excluding pre-joinder preparation. The Court surveyed older authorities (Société Anonyme Pêcheries Ostendaises v Merchants' Marine Insurance Co [1928] 1 KB 750; Scheff v Columbia Pictures Corporation Ltd [1938] 4 All ER 318; Re Gibson's Settlement Trusts [1981] 1 Ch 179) and texts (Quick on Costs; Costs Guide New South Wales) to confirm that costs incidental to litigation can include preparatory work. Ultimately each item would still be tested on taxation, but the order from 22 December 2010 was appropriate in principle. The result was a comprehensive vindication of the successful parties' costs claims.
Before this judgment the law on costs discretion was settled at high level: the successful party usually recovers costs unless disentitling conduct or other discretionary factors appear (Oshlack). What constituted "success" and when partial failure justified apportionment remained somewhat flexible. Decisions such as Tomanovic had emphasised that mere failure on discrete issues does not automatically trigger apportionment. The treatment of joined parties and non-parties was also established (Symphony Group), but the precise costs position of a litigant who is required to prepare before formal joinder had produced divergent first-instance approaches.
The decision clarifies three practical points. First, it sets a high threshold for issue-by-issue costs: the unsuccessful party must show the issue was unreasonably raised, not merely that it consumed time. Second, it confirms that once a party is joined its earlier procedural history is irrelevant to its costs entitlement; the focus is on its status at the time costs orders are made. Third, and perhaps most usefully for practitioners, it interprets the 2011 Rules' definition of party-and-party costs as extending to pre-joinder preparation where the circumstances of the litigation (imminent trial, closed pleadings, urgent joinder) render such preparation necessary. The Court expressly links the new wording ("fairly and reasonably incurred … in the conduct of the litigation") to the older "necessary or proper" authorities, signalling continuity rather than rupture.
After the judgment, costs orders in complex regulatory or constitutional litigation are more predictable. Litigants with distinct interests can run separate cases without automatic fear of costs reduction provided they avoid duplication and the opponent does not seek pre-hearing directions. Parties anticipating joinder can more confidently incur preparatory costs knowing that, if joinder is granted on the basis that they "ought to have been joined", those costs may be recoverable from the date the need crystallised. The judgment has therefore narrowed the scope for late-stage costs arguments of the type Sportsbet advanced.
Paragraph 8 contains the central holding on apportionment: "The outcome of this issue did not relevantly qualify the success of either appellant on its appeal. Both appellants were ultimately wholly successful. The mere fact that a court does not accept all of a successful party's arguments does not make it appropriate to deal with costs on an issue by issue basis." In plain English, winning overall trumps losing on subsidiary points unless the point was obviously a waste of time.
At [10] the Court addresses Tabcorp's status: "Once Tabcorp was joined as a party, its status, both in the proceeding at first instance and on appeal, was that of a party … From this point, Tabcorp acquired a party's rights and obligations with respect to the proceeding, including a party's entitlement to participate in the trial and to appeal." Translation: procedural history before joinder drops away; you are either a party or you are not.
Paragraph 11 disposes of the overlap complaint: "There was no undue overlap between the submissions of the State and Tabcorp. Rather, the appellants conducted their appeals efficiently, having regard to their different interests … It is too late to complain of its separate representation and its role as an appellant at this stage with a view to affecting costs orders." In plain English, if you do not object before the hearing you cannot use overlap as a costs weapon afterwards.
The pivotal passage on pre-joinder costs appears at [15]: "We would not construe the words 'in the conduct of the litigation' as precluding the recovery of costs incurred before a party was formally joined. Rather, the definition of costs as between party and party is directed to the substance of the matter …" Translation: the Rules look at the reality of what was reasonably required to run the case, not the precise date a formal order is entered.
The decision is triggered whenever a party has succeeded overall but failed on one or more discrete issues that occupied substantial hearing time. It applies with particular force in constitutional or regulatory cases where multiple overlapping arguments are advanced. It is directly engaged when one litigant has been joined after pleadings have introduced new allegations against it and the trial timetable is already tight; the Court will look at the practical necessity of preparatory work before the joinder order.
The precedent also speaks to cases involving both governmental and commercial respondents or appellants. Where their interests diverge (public regulatory power versus private commercial advantage) separate representation will ordinarily be regarded as reasonable. The absence of any pre-hearing application to limit the scope of separate representation or to seek directions on costs is treated as powerful evidence that the separate conduct was accepted as legitimate at the time.
Finally, the judgment applies to any dispute about the start date for costs after late joinder. If the moving party can show that the need for its involvement crystallised on a particular date (here the filing of a Reply) and that the existing timetable forced immediate action, costs may run from that earlier date provided the items ultimately pass taxation as "fairly and reasonably incurred".
The judgment has been cited for the proposition that overall success ordinarily attracts full costs even where discrete issues are lost, provided those issues were reasonably arguable. Courts have treated the paragraph 8 statement as reinforcing the high threshold for apportionment set by Oshlack and Tomanovic. The confirmation that a joined party's earlier procedural history is irrelevant to costs entitlement has been applied in subsequent joinder applications where interveners later become formal parties.
The reasoning on pre-joinder costs has been followed in cases where commercial entities have had to prepare evidence and submissions in advance of formal orders because of impending hearing dates. Taxation registrars have used the "substance of the matter" language at [15] when assessing whether preparatory work was fairly and reasonably incurred. The emphasis on the absence of prior objection to separate representation has been deployed to resist late complaints about duplication between state and industry parties.
The decision is treated as an authoritative application of the 2011 Rules' costs dictionary rather than a radical departure from the pre-2011 position. Later single-judge and appellate decisions have cited it alongside Ruddock v Vadarlis (No 2) when reiterating that costs discretion is not to be exercised merely because a successful party raised an argument that ultimately failed.
The judgment leaves open precisely which categories of pre-joinder expenditure will satisfy the "fairly and reasonably incurred in the conduct of the litigation" test on detailed taxation. While the principle is clear, the boundary between recoverable preparatory work and irrecoverable "officious" expenditure is not exhaustively mapped. Practitioners must still persuade a taxing officer that each item was truly necessary given the looming trial timetable.
Another open question is the degree of divergence of interest required before separate representation is automatically regarded as reasonable. The Court accepted that a state government's public-interest role differs from a commercial operator's profit motive, but did not articulate a general formula. In future cases where two commercial parties with closely aligned interests both appear, the outcome on duplication arguments may be less clear.
The interaction between this costs approach and Calderbank or offer-of-compromise regimes is not addressed. If a party makes a generous offer that is rejected and then succeeds on all but one issue, it remains unclear whether the paragraph 8 principle survives or whether the offer changes the discretionary calculus. The judgment also does not discuss how its pre-joinder reasoning applies when the late-joined party is an applicant rather than a respondent, or when the joinder is discretionary rather than mandatory.
Finally, the decision assumes that the primary judge's earlier costs order of 9 September 2011 remains partially intact. Exactly how the "balance" of Tabcorp's costs interacts with that existing order in a complex multi-party taxation is left for the parties and the taxing officer to resolve. These residual practical questions mean the judgment, while clear at the level of principle, continues to generate satellite disputation in high-value regulatory litigation.
VID 1000 of 2011: Counsel for the Appellant: Mr S McLeish SC, Solicitor-General for the State of Victoria with Dr S Donaghue SC and Mr P Herzfeld
Solicitor for the Appellant: Victorian Government Solicitor
Counsel for the First and Second Respondents: Mr N Young QC with Mr T North SC and Mr R Niall SC
Solicitor for the First and Second Respondents: Fitzpatrick Legal
Counsel for the Third Respondent: Mr P Brereton SC with Dr R Higgins
Solicitor for the Third Respondent: Herbert Smith Freehills
The Fourth Respondent submitted to any order the Court might make, save as to costs. The Fourth Respondent made no submissions as to costs.
VID 1002/2011: Mr P Brereton SC with Dr R Higgins Counsel for the Appellant
Solicitor for the Appellant: Herbert Smith Freehills
Counsel for the First and Second Respondents: Mr N Young QC with Mr T North SC and Mr R Niall SC
Solicitor for the First and Second Respondents Fitzpatrick Legal
Counsel for the Third Respondent: Mr S McLeish SC, Solicitor-General for the State of Victoria with Dr S Donaghue SC and Mr P Herzfeld
Solicitor for the Third Respondent: Victorian Government Solicitor
The Fourth Respondent submitted to any order the Court might make, save as to costs. The Fourth Respondent made no submissions as to costs.
IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1000 of 2011
THE VICTORIAN COMMISSION FOR GAMBLING AND LIQUOR REGULATION
JUDGES: EMMETT, KENNY AND MIDDLETON JJ DATE OF ORDER: 3 December 2012 WHERE MADE: MELBOURNE
IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1002 of 2011
BETWEEN: TABCORP HOLDINGS LIMITED (ABN 66 063 780 709)
THE VICTORIAN COMMISSION FOR GAMBLING AND LIQUOR REGULATION
JUDGES: EMMETT, KENNY AND MIDDLETON JJ DATE OF ORDER: 3 December 2012 WHERE MADE: MELBOURNE
THE VICTORIAN COMMISSION FOR GAMBLING AND LIQUOR REGULATION
BETWEEN: TABCORP HOLDINGS LIMITED (ABN 66 063 780 709)
THE VICTORIAN COMMISSION FOR GAMBLING AND LIQUOR REGULATION
JUDGES: EMMETT, KENNY AND MIDDLETON JJ DATE: 3 December 2012 PLACE: MELBOURNE
THE COURT 1 Reasons for judgment in these appeals were published on 12 October 2012. On this date too, the Court directed the appellants to file short minutes of orders to give effect to these reasons. In the event of disagreement about the orders as to costs, the parties were to file short written submissions. 2 There is no disagreement about the substantive orders that should be made to give effect to the reasons for judgment in this matter; and we would make the substantive orders that have been proposed. These reasons are concerned with the question of costs, about which there is disagreement. 3 The State of Victoria ("the State") and Tabcorp Holdings Limited ("Tabcorp") seek orders that Sportsbet Pty Ltd ("Sportsbet") and Eureka Hotel Holdings Pty Ltd ("Eureka") - the unsuccessful respondents in the appeals - pay the State's and Tabcorp's costs of and incidental to each appeal. The State and Tabcorp also propose orders that Sportsbet and Eureka pay the costs of the State and the Victorian Commission for Gambling and Liquor Regulation ("VCGLR") of and incidental to the proceeding at first instance and the balance of Tabcorp's costs of and incidental to the proceeding at first instance from 22 December 2010. 4 Sportsbet and Eureka oppose the orders as to costs that the State and Tabcorp seek. In both appeals, Sportsbet contends that the following orders as to costs would be appropriate: 1. Sportsbet pay 80% of the State's costs of the appeal and the proceeding at first instance including any reserved costs; 2. Sportsbet pay 25% of Tabcorp's costs of the proceeding at first instance; 3. There be no order as to the costs of the appeal as between Tabcorp and Sportsbet. Eureka filed no separate submissions. 5 The appellants were successful in both appeals. The State was successful in VID1000 of 2011 and Tabcorp was successful in VID1002 of 2011. Each was also a respondent in the other's appeal; and each supported the appeal of the other. 6 Ordinarily, a successful party, whether at first instance or on appeal, is entitled to an award of costs in its favour: see Oshlack v Richmond River Council (1998) 193 CLR 72 at 97 [67] (McHugh J) and 120-122 [134] (Kirby J). Where an appellant is successful in its appeal, the Court would ordinarily order the unsuccessful respondent to pay the costs of the appeal and the proceeding at first instance: see Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 237 [16] (Black CJ and French J). 7 Of course, there is no hard and fast rule: the costs of an appeal are ultimately in the discretion of the court. Sportsbet argued that it was appropriate to apportion the costs on appeal and in respect of the trial at first instance to take account of the appellants' failure on the issue as to whether the transactions burdened by the impugned provisions were in trade and commerce between Victoria and the Northern Territory. Sportsbet drew attention to the primary judge's statement that "[a] significant part of the respondents' case was directed at establishing that Sportsbet conducts its business in and out of Victoria": see Sportsbet Pty Ltd v Victoria (2011) 282 ALR 423 at 442 [84]. Sportsbet also submitted that, on the appeals, a significant part of the appellants' submissions were concerned with this issue. 8 We do not consider that the outcome of the issue as to whether the impugned provisions burdened transactions in trade and commerce between Victoria and the Northern Territory justifies departure from the ordinary position. The outcome of this issue did not relevantly qualify the success of either appellant on its appeal. Both appellants were ultimately wholly successful. The mere fact that a court does not accept all of a successful party's arguments does not make it appropriate to deal with costs on an issue by issue basis. It cannot be supposed that the issue in question was unreasonably raised at trial or on appeal. There is nothing else disclosed in the circumstances of the case that would support the proposition that the court should depart from the usual order as to costs: compare Tomanovic v Global Mortgage Equity Corporation Pty Ltd (No 2) (2011) 288 ALR 385 at 402-403 [99]-[100] (Campbell JA, with whom Macfarlan and Young JJA agreed). 9 Sportsbet also submitted that either Tabcorp should not have its costs of the appeal or any costs order should reflect the overlap between the State's and Tabcorp's submissions. Sportsbet relied on the fact that Tabcorp's initial status in the proceeding was limited to that of an intervener (subject to conditions); that Tabcorp's second joinder application succeeded only after Sportsbet amended its pleading to allege that Tabcorp's fixed odds approval was not lawfully given; and that the primary judge's rejection of this part of Sportsbet's case was not challenged on appeal. Sportsbet submitted that "Tabcorp's interest in the subject matter of appeal has to be read in the light of the initial refusal to join it as a party in relation to the issues that were the subject of the appeal". According to Sportsbet, these circumstances and "significant overlap in the written submissions as between the State and Tabcorp" meant that "Sportsbet should not be subjected to two costs orders to meet the same argument". 10 We would reject Sportsbet's argument that Tabcorp's "interest in the subject matter of appeal" is in some way lessened by its prior procedural history. Once Tabcorp was joined as a party, its status, both in the proceeding at first instance and on appeal, was that of a party: see Federal Court Rules 1979 (Cth), O 6 r 8; Federal Court Rules 2011 (Cth), Rule 9.05(1). From this point, Tabcorp acquired a party's rights and obligations with respect to the proceeding, including a party's entitlement to participate in the trial and to appeal. This principle has been affirmed in considering the principles relevant to an award of non-party costs: see, for example, Symphony Group PLC v Hodgson [1994] QB 179 at 193, accepted in Australasian Academy of Natural Medicine Pty Ltd v Walters (2003) 85 SASR 36 at 49 [63] and Western Ventures Pty Ltd v Resource Equities Ltd (2005) 53 ACSR 568 at 576 [46]. In conformity with general principle, a joined party is a "party" for the purposes of Rule 36.01(1) and may institute an appeal pursuant to this rule: compare Forestry Tasmania v Brown (No 2) (2007) 159 FCR 467 at 470 [12]. 11 Further, we would reject Sportsbet's submission that it should not be required to bear the costs of both the State and Tabcorp. There was no undue overlap between the submissions of the State and Tabcorp. Rather, the appellants conducted their appeals efficiently, having regard to their different interests. Both appellants evidently sought to eschew the unnecessary duplication of submissions. It cannot be said that Tabcorp acted unreasonably in conducting its case separately from the State and the VCGLR since Tabcorp's commercial interest was different from the public interest of the State: compare Re Octaviar Ltd (No 8) [2010] QCA 57 at [3]-[5]; Statham v Shephard (No 2) (1974) 23 FLR 244 at 246-247. Furthermore, as Tabcorp observed in its written submissions, prior to the hearing of the appeal, Sportsbet took no steps to seek to confine Tabcorp's conduct as an appellant or to challenge its separate conduct of its case. In this circumstance, Tabcorp was entitled to conduct itself in the manner it did. It is too late to complain of its separate representation and its role as an appellant at this stage with a view to affecting costs orders: compare Credit Lyonnais Australia Ltd v Darling (1991) 5 ACSR 703 at 710. 12 There is one final matter to consider. Tabcorp proposed that its costs at first instance be paid from 22 December 2010, as opposed to 3 March 2012 when the order for its joinder as a party was made. The former date was the date upon which Sportsbet and Eureka filed their Reply, which first raised the allegations as to fixed odds betting. Pursuant to O 6 r 8(1)(a) of the Federal Court Rules 1979 (Cth), which applied when a person "ought to have been joined as a party", the primary judge granted Tabcorp leave to be joined on the basis of these new allegations: see Sportsbet Pty Ltd v The State of Victoria [2011] FCA 170 at [4], [17]-[21]. Her Honour also held that Tabcorp was entitled to be joined as a respondent under O 6 r 8(1)(b) since, by virtue of these new allegations, Tabcorp's joinder was necessary to ensure that all matters in dispute in the proceeding might be "effectually and completely determined and adjudicated upon". 13 Although Tabcorp was not formally joined until 3 March 2011, Tabcorp submitted that, in the period 22 December 2010 to 3 March 2011, it was necessary for it to conduct itself as though it would be joined as a respondent because the hearing date had already been set down for 11 April 2011; the pleadings were closed and the evidence was due to be filed before Tabcorp's joinder application was heard; and Tabcorp was given only 2 business days after being joined to file its Defence and to adduce any additional evidence. In these circumstances - all of which appear on the court file - Tabcorp's submission should be accepted. Had it not so conducted itself, the brief period between its formal joinder and the trial fairly indicates that Tabcorp would not have been in a position to file its defence as ordered and to adduce evidence and participate in the trial as scheduled. The fact that it had placed itself in this position was also a factor that the primary judge considered when her Honour granted Tabcorp's joinder application: see Sportsbet Pty Ltd v The State of Victoria [2011] FCA 170 at [20]. Subject to what is said below, we would order that Tabcorp's costs be paid from 22 December 2011, rather than 3 March 2012. 14 There is no in-principle objection to Tabcorp's recovering costs from 22 December 2010, rather than 3 March 2011. The authorities show that an order for costs of and incidental to an application may include costs incurred in the preparation for litigation, as well as in the litigation, providing they satisfy the relevant test for determining the recoverability: see Société Anonyme Pêcheries Ostendaises v Merchants' Marine Insurance Co [1928] 1 KB 750 at 756-757, 762-763, 765; Scheff v Columbia Pictures Corporation Ltd [1938] 4 All ER 318 at 323 (Slesser LJ), 324 (MacKinnon LJ); Re Gibson's Settlement Trusts [1981] 1 Ch 179 at 188-189; Higgins v Nicol (No 2) (1972) 21 FLR 34 at 37-38; Quick R, Quick on Costs (Lawbook Co., subscription service) at [6.740] (update 64); and Costs Guide New South Wales (Lawbook Co., subscription service) at 2-7066 (update 92). In all the above cases, the relevant test for recoverability was whether the expense was "necessary or proper for the attainment of justice or for defending the rights of any party". 15 Under the Federal Court Rules 2011 (Cth), an order allowing "costs as between party and party" is defined to mean those costs "fairly and reasonably incurred by the party in the conduct of the litigation": see the Dictionary in sch 1. Rule 40.30 makes provision for costs that are to be disallowed on taxation. These provisions replace the general provision for the recovery of costs "necessary or proper for the attainment of justice or for maintaining or defending the rights of a party" in O 62 r 19 of the previous Rules, which also made provision for disallowance. We would not construe the words "in the conduct of the litigation" as precluding the recovery of costs incurred before a party was formally joined. Rather, the definition of costs as between party and party is directed to the substance of the matter: that is, an order for party and party costs will encompass such costs as were fairly and reasonably incurred in the conduct of the litigation by a person who is a party to the litigation at the time the costs order is made. Depending on the circumstances of the case, this not only covers costs incurred in the litigation (when a party) but also costs incurred in preparation for the litigation (prior to becoming a party). Whether or not any costs claimed by Tabcorp from 22 December 2010 are recoverable will ultimately depend on whether they are accepted as satisfying the conditions for recoverability in the current Rules. 16 Accordingly, for the reasons stated, we would order that, in each appeal, Sportsbet and Eureka pay the appellant's and the third respondent's costs of and incidental to the appeal. We would also order that, in addition to the costs referred to in paragraph 2 of the primary judge's order of 9 September 2011, Sportsbet and Eureka pay the balance of Tabcorp's costs of and incidental to the first instance proceeding from 22 December 2010; and that Sportsbet and Eureka pay the State's and VCGLR's costs of and incidental to that proceeding. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Emmett, Kenny and Middleton.
The State of Victoria
Sportsbet Pty Ltd
[2010] QCA 57
(1998) 193 CLR 72
(2001) 115 FCR 229
(2011) 282 ALR 423
(2011) 288 ALR 385
(2003) 85 SASR 36
(2007) 159 FCR 467
(1974) 23 FLR 244
(1972) 21 FLR 34
In each appeal the appeal is allowed; Sportsbet and Eureka to pay the costs of the State, Tabcorp and the VCGLR of the appeals and (subject to one existing order) of the proceeding at first instance; Tabcorp's first-instance costs payable from 22 December 2010; primary judge's costs orders varied accordingly.