case_text: is also now an extensive body of judicial consideration on the scope and requirements of s 155 notices, but it is convenient to refer to the decision of the Full Federal Court in Seven Network Ltd v Australian Competition and Consumer Commission [2004] FCAFC 267 ; (2004) 140 FCR 170. In that case Sackville and Emmett JJ set out the process for construing notices against the s 155 requirements, and stated (at 182-83): The authorities have established a number of propositions concerning the interpretation of s 155(1) of the TP Act. They include the following: (i) In a context where refusal or failure to comply with a s 155 notice is punishable by imprisonment or fine, the notice must: (a) convey with reasonable clarity to the recipient the information that must be furnished; and (b) disclose that the ACCC is entitled to require the recipient to furnish the specified information: Pyneboard Pty Ltd v Trade Practices Commission [1983] HCA 9 ; (1982) 57 FLR 368 at 374, per curiam. (ii) The second of these requirements will not be satisfied unless it appears from the notice that the information sought is information "relating" to one or more "matters" of a kind described in s 155(1): Pyneboard v TPC at 375 ; SA Brewing v Baxt at 369-70 ; Bannerman v Mildura Fruit Juices Pty Ltd [1984] FCA 156 ; (1984) 2 FCR 581 at 584, per Bowen CJ and Neaves J. However, the question whether a notice discloses the necessary "relatedness" is not to be approached in an "over-technical or hypercritical way": Pyneboard v TPC at 376. Moreover, the "relatedness" is to a proper inquiry into the suspected offences: Panelboard Pty Ltd v Trade Practices Commission [1981] FCA 98 ; (1981) 59 FLR 395 at 407, per Fox J. (iii) Section 155(1) does not require the Chairperson of the ACCC to have "reason to believe" that a specified matter constitutes or may constitute a contravention of the TP Act. The Chairperson must, however, have reason to believe that the relevant person is capable of furnishing information relating to the matter specified in the notice: WA Pines v Bannerman at 179, per Brennan J (with whom Bowen CJ agreed); TNT Australia Pty Ltd v Fels [1992] HCA 55 ; [1992] ATPR 40 ,595 (41-190) at 40,598-40,599, per Gummow J. It follows that the Chairperson or other officer must believe that the person to whom the notice is directed is capable of furnishing information relating to the facts known or suspected: WA Pines v Bannerman at 180. In addition, there must be facts in existence which are sufficient to induce that belief in a reasonable person: George v Rockett at 112. (iv) The word "matter" in s 155(1) is to be construed in its ordinary sense of an affair or thing: Melbourne Home of Ford Pty Ltd v Trade Practices Commission [1979] FCA 15 ; (1979) 36 FLR 450 at 474, per Franki and Northrop JJ; SA Brewing v Baxt at 369. It refers to a body of facts which constitutes or may constitute a contravention of the TP Act. Whether or not the relevant body of facts constitutes a contravention is a matter of law and does not turn on the perception or knowledge of the ACCC or its officers: WA Pines v Bannerman at 179. (v) When s 155(1) speaks of a matter which may constitute a contravention, it refers to a body of facts not fully known and which may, when fully known, reveal themselves as constituting a contravention: WA Pines v Bannerman at 179. The words "may constitute" enable a court to judge from the material in the notice whether, if other facts which may or may not have occurred come to light, the whole body of facts would constitute a contravention: SA Brewing v Baxt at 370. It is not necessary for the Court to determine whether a contravention has occurred; but equally it will not "idly speculate" or "draw on improbable circumstances" to uphold a notice: SA Brewing v Baxt at 370. An alternative formulation is that the Court can take account of facts which may "reasonably be suspected" to have occurred: WA Pines v Bannerman at 179. (vi) Where the matter referred to in the notice, after allowing for undiscovered facts, is incapable of amounting to a contravention, the issue of the notice is not a valid exercise of the power conferred by s 155(1): SA Brewing v Baxt at 371-72. (vii) In view of the principle that a court should not adopt an "over-technical or hypercritical approach" to the construction of a notice, there is no requirement that the notice "plead" all the facts necessary to constitute a contravention or possible contravention of the TP Act: SA Brewing v Baxt at 370. (viii) Information which tends to negative a suspected contravention or liability to conviction or which tends to exculpate a person suspected to be a party to a contravention, is within the ambit of s 155(1). It follows that an inquiry under s 155 may relate to a defence or possible defence available to the suspected person: WA Pines v Bannerman at 180. This conclusion derives from the principles referred to in Seven Network [2004] FCAFC 267 ; 140 FCR 170 , and accords with the reasoning of Bowen CJ and Neaves J (at 586-87) and Davies J (at 590-91) in Bannerman v Mildura Fruit Juices Pty Ltd [1984] FCA 156 ; (1984) 2 FCR 581 , the views expressed by the Full Court (Northrop, Deane and Fisher JJ) in Pyneboard Pty Ltd v Trade Practices Commission [1983] HCA 9 ; (1982) 57 FLR 368 at 373-74 If the Notices were properly framed and only referred to services in relation to outbound routes, then on the applicants' case, the fact that there may be acquirers of those services outside Australia would not affect the validity of the Notices on this primary ground of attack. It would be accepted there is a market in Australia. No suggestion would be made that the Notices are enquiring into a matter not the subject of the Notice in reliance of the principles outlined in Bannerman [1984] FCA 156 ; 2 FCR 581 , Pyneboard [1983] HCA 9 ; 57 FLR 368 and Melbourne Steamship Co Ltd [1912] HCA 69 ; 15 CLR 333. It then remains to address the application of the principles enunciated in Pyneboard [1983] HCA 9 ; 57 FLR 368 . Northrop, Deane and Fisher JJ there observed (at 377-8): There remains to be considered the availability to the appellants of the grounds upon which they object to a particular requirement to produce documents, namely, that it is harsh, oppressive and unreasonable. The mere fact that compliance with a requirement to furnish information or to produce documents would be burdensome will not invalidate that requirement in a s.155 notice (see Melbourne Home of Ford v Trade Practices Commission (No. 3) ; Riley McKay Pty Ltd v Bannerman ). Nor will objective harshness, unreasonableness or oppressiveness of a requirement in such a notice constitute an independent ground of invalidity. If invalidity by reference to these qualities is to be established, it must be by reference to the implied general limitation upon the power conferred by s 155(1) of the Act to which reference has already been made, namely, that it is a condition of a valid exercise of the power that it be used in good faith for the purpose for which it was conferred and with regard to the effect that the exercise of the power will have upon those affected thereby. It is only if the harshness, oppressiveness or unreasonableness of a requirement in a s 155 notice is, in all the circumstances, such as to warrant the conclusion that the requirement could not have been imposed in good faith or could only have been imposed to achieve a collateral purpose or without regard to the burden which it would impose upon the recipient, that harshness, oppressiveness or unreasonableness will result in invalidity. (Emphasis added, citations omitted.) I have already concluded that Mr Samuel had regard to the burden imposed on the applicants. It now remains to consider the question of good faith, and a possible separate issue of unreasonableness. To a certain extent, the issues of failing to take into account the burden, good faith and unreasonableness overlap. Obviously, a requirement may be harsh, unreasonable and oppressive, and still not result in invalidity. As observed by Gibbs CJ in Pioneer Concrete (Vic) Pty Ltd v Trade Practices Commission [1982] HCA 65 ; (1982) 152 CLR 460 , '[t]he power [under s 155] is a drastic power and is capable of abuse and must be exercised with care' (at 468). The time for compliance has statutory significance. The recipient is obliged to furnish the information sought within the time specified in the notice, and must produce the documents sought in accordance with the notice: subs 155(1). It is an offence to fail to comply: subs 155(5) and (6A). These are matters that needed to be considered by Mr Samuel, as they undoubtedly were, as part of the statutory context of issuing the Notices and as part of the consequences of non-compliance. Once one reaches the conclusion that the decision to issue the Notices was exercised with care, took into account the relevant considerations, and was not to be impugned on the basis of the principles in Pyneboard [1983] HCA 9 ; 57 FLR 368 , then the reference to the statutory significance of compliance takes the argument no further. I now turn to the separate ground relied upon of unreasonableness. It may be that the concept of unreasonableness is caught within the principles of Pyneboard [1983] HCA 9 ; 57 FLR 368. Nevertheless, I do not consider that approaching the matter on the basis of unreasonableness, even if a separate ground to consider apart from the approach taken in Pyneboard , further advances the arguments of the applicants in support of their applications.


case_outcome: cited

case_text: addition Dawson J observed in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Company Ltd [1989] HCA 6 ; (1989) 167 CLR 177 (at 198-99): Lying behind both of those questions is the concept of the market, a concept which is sometimes dealt with in a more complex manner than is necessary. A market is an area in which the exchange of goods or services between buyer and seller is negotiated. It is sometimes referred to as the sphere within which price is determined and that serves to focus attention upon the way in which the market facilitates exchange by employing price as the mechanism to reconcile competing demands for resources: see Stigler and Sherwin, "The Extent of the Market", (1985) 28 Journal of Law and Economics vol 28 (1985) 555 at p. 555. In setting the limits of a market the emphasis has historically been placed upon what is referred to as the "demand side", but more recently the "supply side" has also come to be regarded as significant. The basic test involves the ascertainment of the cross-elasticities of both supply and demand, that is to say, the extent to which the supply of or demand for a product responds to a change in the price of another product. Cross-elasticities of supply and demand reveal the degree to which one product may be substituted for another, an important consideration in any definition of a market. This is reflected in s 4E of the Trade Practices Act which provides: "For the purposes of this Act, 'market' means a market in Australia and, when used in relation to any goods or services, includes a market for those goods or services and other goods or services that are substitutable for, or otherwise competitive with , the first-mentioned goods or services" (My emphasis.) Important as they are, elasticities and the notion of substitution provide no complete solution to the definition of a market. A question of degree is involved — at what point do different goods become closely enough linked in supply or demand to be included in the one market — which precludes any dogmatic answer. See Times-Picayune v United States . (Citations omitted.)


case_text: separate allegation of unreasonableness, particularly in the statutory context of s 155 of the Act, needs to be approached with caution. As Gleeson CJ said in Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S 20/2002 [2003] HCA 30 ; (2003) 198 ALR 59 at [5] : ... to describe reasoning as illogical, or unreasonable, or irrational, may merely be an emphatic way of expressing disagreement with it. If it is suggested that there is a legal consequence, it may be necessary to be more precise as to the nature and quality of the error attributed to the decision-maker, and to identify the legal principle or statutory provision that attracts the suggested consequence.


case_outcome: followed

case_text: my view, the Court does have a discretion to refuse relief in such circumstances, even to the extent the application is brought under s 163A of the Act: see, eg, Re Tooth & Co Ltd [1978] FCA 9 ; (1978) 31 FLR 314. As I have said, time for compliance has been extended. This time frame is not in dispute. Documents have been delivered by the applicants to the ACCC by reason of some or all of the Notices. The applicants did not challenge the decision to issue the Notices or the Notices before supplying those documents. Some delay occurred before the applicants brought their applications in this Court. There is no suggestion that any prosecution is intended based upon the Notices and the original time frame for compliance. These would all be reasons for refusing as a matter of discretion the substantive relief sought by the applicants. In view of the above reasons, the applications should be dismissed. I will make orders to facilitate the parties reaching an agreement as to costs. In the event that no agreement is reached, then orders will be made as to the exchange of submissions on the issue of costs. I certify that the preceding one hundred and twenty-three (123) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Middleton. Associate: Dated: 2 April 2009 Counsel for the Applicant in VID 252 of 2008: Mr C Caleo SC and Mr D Batt Solicitor for the Applicant in VID 252 of 2008: Allens Arthur Robinson Counsel for the Respondents in VID 252 of 2008: Mr N O'Bryan SC and Mr M Hoyne Solicitor for the Respondents in VID 252 of 2008: Australian Government Solicitor Counsel for the Applicants in VID 234 of 2008: Mr M O'Bryan Solicitor for the Applicants in VID 234 of 2008: Minter Ellison Counsel for the Respondent in VID 234 of 2008: Mr N O'Bryan SC and Mr M Hoyne Solicitor for the Respondent in VID 234 of 2008: Australian Government Solicitor Dates of Hearing: 8, 9, 11, 14 and 15 July 2008 Date of Judgment: 2 April 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/312.html


case_outcome: approved

case_text: notion of a 'market in Australia' was recently referred to by Lindgren J in Australian Competition and Consumer Commission v Qantas Airways Limited [2008] FCA 1976 , where his Honour stated (at [33]-[34]): Although the notion of a "market in Australia" in s 4E has been referred to in two cases ( Riverstone Computer Services Pty Ltd v IBM Global Financing Australia Ltd [2002] FCA 1608 at [21] per Hill J and Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Ltd (2008) ATPR 42-256 at [19] per Tracey J), the concept has not been the subject of extensive judicial consideration. In Riverstone , Hill J rejected the proposition that in order to be a "market in Australia" a market must be wholly within Australia. His Honour said (at [21]) that the fact that a market was global did not signify that there could not be a market in Australia for the same products. As the Commission points out, a contrary view would considerably reduce the efficacy and utility of the competition law provisions of the Act, especially in the modern telecommunications era. In my opinion, Hill J in Riverstone Computer Services Pty Ltd v IBM Global Financing Australia Limited [2002] FCA 1608 was correct in concluding that the fact that a market was global did not signify that there could not be a market in Australia for the same products (or services). However, I do not take the reference by Hill J to a global market which includes Australia as arguably a market in Australia 'if sales are made [in Australia]' ([2002] FCA 1608 at [22] ) as making it a requirement that the contract under which services are supplied in Australia must be entered into in Australia or that the transactions themselves must be entered into in Australia. In my view, Hill J was simply proffering an example of how one might identify the possible location of competition, and was not providing a definitive statement that buyers and sellers of services must enter into transactions in Australia.


case_text: Lindgren went on to conclude that the definition of "market in Australia" in s 4E excludes a market that is wholly outside Australia, a conclusion with which I respectfully agree. As other aspects of the decision in Qantas [2008] FCA 1976 proceeded upon agreed facts, however, that case provides little assistance in determining the other issues raised before me which involved 'a concrete dispute reached after contest in argument': see Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 at [62] (per Gummow, Hayne and Heydon JJ).


case_text: the outset I indicate that 'as a matter of logic and without the necessity to have all of the facts' it may be concluded in any given case that particular conduct is not capable of constituting a contravention of the Act: see S A Brewing Holdings Ltd v Baxt (1989) 23 FCR 357 at 377 per Wilcox J. Evidence may be admitted to show conclusively that, even without all of the facts, the particular conduct as described in a s 155 notice would not be capable of constituting a contravention of the Act. However, evidence could not be led to show that there is in fact no contravention, assuming the particular conduct as described in a s 155 notice was capable of constituting a contravention of the Act. It is important to recall that the Notices should not be read in an overly-technical way: they are to be 'reasonably, not preciously, construed': see Melbourne Home of Ford Pty Ltd v Trade Practices Commission (No 3) [1980] FCA 94 ; (1980) 47 FLR 163 at 175-76 (per Brennan, Keely and Fisher JJ), and S A Brewing 23 FCR 357 at 369 (per Fisher and French JJ). In addition, regard may be had to the identity of, and the knowledge available to, the recipient of the notice: see Seven Network [2004] FCAFC 267 ; 140 FCR 170 , 189 at [75] (per Sackville and Emmett JJ). The applicants' evidence does not eliminate (as it must) any reasonable hypothesis which is inconsistent with the contention that the market is wholly outside Australia even if one focuses on the inbound services in isolation: see S A Brewing 23 FCR 357 at 370 and Seven Network [2004] FCAFC 267 ; 140 FCR 170 at [9] and [52]. There are many reasons for this, but I provide a non-exhaustive list:


case_text: faith normally involves a lack of an honest or genuine attempt to undertake the statutory function allocated to the decision-maker: see, eg, SCAS v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 397 at [19] per Heerey, Moore and Kiefel JJ. There is a very heavy burden upon any applicant seeking to demonstrate bad faith.


case_text: is also now an extensive body of judicial consideration on the scope and requirements of s 155 notices, but it is convenient to refer to the decision of the Full Federal Court in Seven Network Ltd v Australian Competition and Consumer Commission [2004] FCAFC 267 ; (2004) 140 FCR 170. In that case Sackville and Emmett JJ set out the process for construing notices against the s 155 requirements, and stated (at 182-83): The authorities have established a number of propositions concerning the interpretation of s 155(1) of the TP Act. They include the following: (i) In a context where refusal or failure to comply with a s 155 notice is punishable by imprisonment or fine, the notice must: (a) convey with reasonable clarity to the recipient the information that must be furnished; and (b) disclose that the ACCC is entitled to require the recipient to furnish the specified information: Pyneboard Pty Ltd v Trade Practices Commission [1983] HCA 9 ; (1982) 57 FLR 368 at 374, per curiam. (ii) The second of these requirements will not be satisfied unless it appears from the notice that the information sought is information "relating" to one or more "matters" of a kind described in s 155(1): Pyneboard v TPC at 375 ; SA Brewing v Baxt at 369-70 ; Bannerman v Mildura Fruit Juices Pty Ltd [1984] FCA 156 ; (1984) 2 FCR 581 at 584, per Bowen CJ and Neaves J. However, the question whether a notice discloses the necessary "relatedness" is not to be approached in an "over-technical or hypercritical way": Pyneboard v TPC at 376. Moreover, the "relatedness" is to a proper inquiry into the suspected offences: Panelboard Pty Ltd v Trade Practices Commission [1981] FCA 98 ; (1981) 59 FLR 395 at 407, per Fox J. (iii) Section 155(1) does not require the Chairperson of the ACCC to have "reason to believe" that a specified matter constitutes or may constitute a contravention of the TP Act. The Chairperson must, however, have reason to believe that the relevant person is capable of furnishing information relating to the matter specified in the notice: WA Pines v Bannerman at 179, per Brennan J (with whom Bowen CJ agreed); TNT Australia Pty Ltd v Fels [1992] HCA 55 ; [1992] ATPR 40 ,595 (41-190) at 40,598-40,599, per Gummow J. It follows that the Chairperson or other officer must believe that the person to whom the notice is directed is capable of furnishing information relating to the facts known or suspected: WA Pines v Bannerman at 180. In addition, there must be facts in existence which are sufficient to induce that belief in a reasonable person: George v Rockett at 112. (iv) The word "matter" in s 155(1) is to be construed in its ordinary sense of an affair or thing: Melbourne Home of Ford Pty Ltd v Trade Practices Commission [1979] FCA 15 ; (1979) 36 FLR 450 at 474, per Franki and Northrop JJ; SA Brewing v Baxt at 369. It refers to a body of facts which constitutes or may constitute a contravention of the TP Act. Whether or not the relevant body of facts constitutes a contravention is a matter of law and does not turn on the perception or knowledge of the ACCC or its officers: WA Pines v Bannerman at 179. (v) When s 155(1) speaks of a matter which may constitute a contravention, it refers to a body of facts not fully known and which may, when fully known, reveal themselves as constituting a contravention: WA Pines v Bannerman at 179. The words "may constitute" enable a court to judge from the material in the notice whether, if other facts which may or may not have occurred come to light, the whole body of facts would constitute a contravention: SA Brewing v Baxt at 370. It is not necessary for the Court to determine whether a contravention has occurred; but equally it will not "idly speculate" or "draw on improbable circumstances" to uphold a notice: SA Brewing v Baxt at 370. An alternative formulation is that the Court can take account of facts which may "reasonably be suspected" to have occurred: WA Pines v Bannerman at 179. (vi) Where the matter referred to in the notice, after allowing for undiscovered facts, is incapable of amounting to a contravention, the issue of the notice is not a valid exercise of the power conferred by s 155(1): SA Brewing v Baxt at 371-72. (vii) In view of the principle that a court should not adopt an "over-technical or hypercritical approach" to the construction of a notice, there is no requirement that the notice "plead" all the facts necessary to constitute a contravention or possible contravention of the TP Act: SA Brewing v Baxt at 370. (viii) Information which tends to negative a suspected contravention or liability to conviction or which tends to exculpate a person suspected to be a party to a contravention, is within the ambit of s 155(1). It follows that an inquiry under s 155 may relate to a defence or possible defence available to the suspected person: WA Pines v Bannerman at 180. This conclusion derives from the principles referred to in Seven Network [2004] FCAFC 267 ; 140 FCR 170 , and accords with the reasoning of Bowen CJ and Neaves J (at 586-87) and Davies J (at 590-91) in Bannerman v Mildura Fruit Juices Pty Ltd [1984] FCA 156 ; (1984) 2 FCR 581 , the views expressed by the Full Court (Northrop, Deane and Fisher JJ) in Pyneboard Pty Ltd v Trade Practices Commission [1983] HCA 9 ; (1982) 57 FLR 368 at 373-74 The correct starting point is to determine whether the matters identified in the Notices are incapable, after allowing for undiscovered facts, of constituting a contravention of s 45 of the Act by reference to the deeming provision of s 45A. As noted by Sackville and Emmett JJ in Seven Network [2004] FCAFC 267 ; 140 FCR 170 '[u]ltimately, the question is whether the matter identified in the Notices "may constitute" a contravention of the [Act]' (at 184). The substantial challenge to the decision to issue the Notices, and to the Notices themselves, seized upon this concept of 'matter'; specifically, Emirates argued that the Notices should be set aside because they: relate to, and purport to require [the applicants] to furnish information and produce documents relating to, matters that cannot constitute a contravention of s 45(2) of the [Act] . Those matters concern alleged agreements or understandings relating to the supply of air cargo services on routes into Australia and routes between two or more points outside Australia. Such services are not supplied in competition in a market in Australia. By virtue of s 45(3) and 4E of the [Act] , it is only services supplied in competition in a market in Australia that can possibly found a contravention of s 45(2). Singapore Airlines essentially made the same submission. It was accepted by Emirates and Singapore Airlines that the evidence adduced in these proceedings was not intended to, nor would it enable, the Court to conclude whether all international air cargo services are supplied in a single global market or in many different markets and the boundaries of those markets. It was said by Emirates, at least, that: (a) the Notices allege an arrangement containing provisions that fix the price of international air cargo services supplied by the parties throughout the world; (b) regardless of whether a conclusion is ultimately reached that international air cargo services are supplied in a single global market or many different markets, the supply of those services outside Australia to acquirers outside Australia cannot occur in a market in Australia within the meaning of the Act; (c) in so far as the alleged arrangement contained a provision fixing the price of international air cargo services supplied outside Australia to acquirers outside Australia, it does not satisfy the elements of s 45A; and (d) the conclusion in para (c) holds regardless of whether the parties to the arrangement also supply international air cargo services of the same kind in Australia to acquirers in Australia. It is important to recall that the Notices should not be read in an overly-technical way: they are to be 'reasonably, not preciously, construed': see Melbourne Home of Ford Pty Ltd v Trade Practices Commission (No 3) [1980] FCA 94 ; (1980) 47 FLR 163 at 175-76 (per Brennan, Keely and Fisher JJ), and S A Brewing 23 FCR 357 at 369 (per Fisher and French JJ). In addition, regard may be had to the identity of, and the knowledge available to, the recipient of the notice: see Seven Network [2004] FCAFC 267 ; 140 FCR 170 , 189 at [75] (per Sackville and Emmett JJ). The applicants' evidence does not eliminate (as it must) any reasonable hypothesis which is inconsistent with the contention that the market is wholly outside Australia even if one focuses on the inbound services in isolation: see S A Brewing 23 FCR 357 at 370 and Seven Network [2004] FCAFC 267 ; 140 FCR 170 at [9] and [52]. There are many reasons for this, but I provide a non-exhaustive list:


case_text: Singapore Airlines Ltd v Taprobane Tours WA Pty Ltd [1991] FCA 621 ; (1991) 33 FCR 158 French J (Spender and O'Loughlin JJ agreeing) said in relation to market identification (at 174): In competition law it has a descriptive and a purposive role. It involves fact finding together with evaluative and purposive selection. In any given application it describes a range of economic activities defined by reference to particular economic functions (eg manufacturing, wholesale or retail sales), the class or classes of products, be they goods or services, which are the subject of those activities and the geographic area within which those activities occur. In its statutory setting the market designation imposes, on the activities which it encompasses, limits set by the law for the protection of competition. It involves a choice of the relevant range of activity by reference to economic and commercial realities and the policy of the statute. To the extent that it must serve statutory policy, the identification will be evaluative and purposive as well as descriptive.


case_text: services the subject of the unlawful provision must be the services supplied by the relevant party to the arrangement in competition with the other party in any market in Australia. Put another way, the area of competition has to coincide with the area of restriction imposed by the unlawful provision: see ss 45A(8), 4D(1)(a) and 4D(2); Eastern Express Pty Ltd v General Newspapers Pty Ltd (1991) 30 FCR 385 at 419-20 per Wilcox J; and South Sydney District Rugby League Football Club v News Limited [2000] FCA 1541 ; (2000) 177 ALR 611 at 657 per Finn J.


case_text: principles relevant to this aspect of the proceedings can be simply stated: (a) The failure of a decision-maker to take into account a relevant consideration in the making of an administrative decision is an abuse of discretion entitling a party with sufficient standing to seek judicial review of the decision. (b) This ground of review can only be made out if the decision-maker fails to take into account a consideration that they are bound to take into account in making the decision. (c) The factors a decision-maker is bound to take into account in making a decision are determined by construction of the statute conferring the power. Where the matters to be taken into account are not expressly stated in the statute, they must be determined by implication from the subject matter, scope and purpose of the Act: see Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40 ; (1986) 162 CLR 24 at 39-40 per Mason J. (d) A decision-maker may not have had proper regard to a relevant consideration if they merely make a formalistic reference to the consideration: see Azriel v NSW Land & Housing Corporation [2006] NSWCA 372 at [49] per Basten JA (with whom Santow and Ipp JJA agreed at [1] and [3]). (e) A decision-maker is required to give proper, genuine and realistic consideration to a relevant consideration: see Deloitte Touche Tohmatsu v Australian Securities Commission (1996) 136 ALR 453 at 468 (per Lindgren J); Bruce v Cole (1998) 45 NSWLR 163 at 185-6 per Spigelman CJ and the authorities cited therein. (f) The mere failure to refer expressly to a matter will not necessarily give rise to the inference that it was not taken into account: see Australian Conservation Foundation v Forestry Commission (1988) 19 FCR 127 at 132 (per Burchett J). However, it is open to the Court to infer that a matter was not taken into account where no reference is made to it: see, eg, Sullivan v Department of Transport (1978) 20 ALR 323 at 349 (per Deane J). (g) In Deloitte Touche Tohmatsu 136 ALR 453 , Lindgren J said (at 468): It is for an applicant to make out its case of "failure to take into account", but the circumstances may be such that the applicant will be aided in this task by an absence of evidence from the decision-maker on a particular matter, such as an absence of evidence giving rise to an inference of a failure to make further inquiries when a genuine taking into account would have called for them.


case_text: in Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 2) (1979) 40 FLR 83 Fisher J said (at 111): The Trade Practices Tribunal considered the concept of market in some detail in Re Queensland Co-operative Milling Association Ltd (1975-6) 8 ALR 481 at 517, where the members said: "A market is the area of close competition between firms or, putting it a little differently, the field of rivalry between them. ... Within the bounds of a market there is substitution substitution between one product and another, and between one source of supply and another, in response to changing prices. So a market is the field of actual and potential transactions between buyers and sellers amongst whom there can be strong substitution, at least in the long run, if given a sufficient price incentive". It is significant to note that consideration must be given to both actual and potential transactions between buyers and sellers in identifying the 'field of rivalry' between competitors.


case_text: Universal Music Australia Pty Ltd v Australian Competition and Consumer Commission [2003] FCAFC 193 ; (2003) 131 FCR 529 the Full Court (Wilcox, French and Gyles JJ) said (at 545): The concept of a "market" is a metaphor used to describe a range of competitive activities by reference to function, product and geography. The application of the metaphor may be informed by economic analysis, provided it is rooted in commercial realities.


case_outcome: affirmed

case_title: BRGAE of 2006 & Anor v Minister for Immigration & Anor [2008] FMCA 182


case_title: Minister for Immigration and Multicultural Affairs v Respondents S152/2003 [2004] HCA 18 ; (2004) 222 CLR 1

case_text: mere lack of resources does not of itself give rise to the kind of lack of state protection that is necessary to establish a well-founded fear of persecution for a Convention reason. As McHugh J observed in Minister for Immigration & Multicultural Affairs v Respondents S152/2003 [2004] HCA 18 ; (2004) 222 CLR 1 at [33] : ' [t] he inability of Australian governments to eliminate [death or serious injury from motor car accidents] does not determine whether the fear [of death or serious injury from a motor accident] is well-founded.' The second ground of appeal concerns whether or not any part of the Tribunal's reasons were based upon information that should have been disclosed to the appellant pursuant to s 424A(1) of the Act. Leave is required for the appellant to raise this ground as it was not argued before the Federal Magistrate. It is submitted by the appellant that s 424A(1) of the Act applies in this case in two ways. First, there was a reference in the Tribunal's reasons to country information that had been before the Delegate. The country information included the response of the Department of Foreign Affairs and Trade to a series of questions apparently asked by the Tribunal concerning the status of women trafficking in Mongolia ('the response'). The appellant accepts that if the response was information of a kind to which s 424A(3)(a) of the Act applied it did not need to be disclosed to the appellant. However, the appellant submits that because the response commenced with the words ' SEVERAL FEMALE APPLICANTS CLAIM TO HAVE PARTICIPATED IN PROTESTING AGAINST WOMEN TRAFFICKING IN MONGOLIA ON BEHALF OF A LOCAL WOMENS SUPPORT GROUP ' (emphasis added), the information must be ' specifically about the applicant or another person ' and not ' just about a class of persons of which the applicant or other person is a member ' (s 434A(3)(a)). It is clear to me that when one looks at the response in its totality, the information relates only to a class of persons. All of the answers to the questions and the questions themselves relate to a class of persons, being victims of women trafficking or persons participating in protests against women trafficking, and not to any individual. Accordingly, even if that did form part of the information upon which the Tribunal relied, the Tribunal was not obliged to disclose the response to the appellant.


case_text: basis for the Tribunal's decision was that it was the unsatisfactory nature of the evidence before the Tribunal alone that was the reason for affirming the decision of the Delegate. That such information does not come within s 424A(1) has been reaffirmed in SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCAFC 2 ; (2006) 150 FCR 214 at [223] to [224] and again in SZCIA v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 238 at [12] .


case_title: SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCAFC 2 ; (2006) 150 FCR 214


case_outcome: referred to

case_text: In the appellant's submission, this approach demonstrated that the Tribunal was distracted from the question that is at the heart of any enquiry as to whether a person is a refugee, namely does the person have a well-founded fear of future persecution should that person be returned to their own country. This is the crucial issue and, as Gummow and Hayne JJ have noted, persecution in the past is neither necessary nor sufficient for an affirmative answer to that question. A person could have a well-founded fear of persecution even if there is no likelihood that those responsible for past persecution would be able to mete out similar treatment in the future or even if there had been no persecution in the past; Appellant S395/2002 v Minister for Immigration and Multicultural Affairs [2003] HCA 71 ; (2003) 216 CLR 473 at [72] - [74] . 30 The Tribunal found that the appellant had a reputation as a troublemaker and that it was likely that this was at the root of his past treatment. That being so it was not sufficient to find that those responsible for that treatment would not seek him out in other parts of Egypt. It was necessary for the Tribunal to ask if the appellant is likely to continue with the conduct that marked him as a troublemaker in the past and, if so, whether that conduct would, in the future, evoke a similar response from others. The Tribunal is not entitled to base its prediction on an expectation that the appellant will modify his behaviour on his return to Egypt; Appellant S395/2002 at [40] per McHugh and Kirby JJ and at [80]-[82] per Gummow and Hayne JJ. 31 The appeal must be allowed with costs. I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Stone . Associate: Dated: 12 January 2007 Counsel for the Appellant: B O'Donnell Counsel for the First Respondent: R Francois Solicitor for the First Respondent: Australian Government Solicitor Date of Hearing: 11 December 2006 Date of Judgment: 12 January 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/9.html


case_outcome: discussed

case_title: Minister for Immigration and Multicultural and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259

case_text: The Minister urged a 'beneficial' construction of the Tribunal's reasons and referred to comments made in Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6 ; (1996) 185 CLR 259, in particular at 271-272. The phrase 'beneficial construction', as used in Wu Shan Liang has a specific meaning, and was certainly not intended to mean that any ambiguity in the Tribunal's reasons be resolved in the Tribunal's favour. Rather, the construction of the Tribunal's reasons should be beneficial in the sense that the Tribunal's reasons would not be over-zealously scrutinised, with an eye attuned to error. In this sense a 'beneficial' approach to the Tribunal's reasons does not require this Court to assume that a vital issue was addressed when there is no evidence of this and, indeed, the general thrust of the Tribunal's comments suggest that the issue was overlooked.


case_outcome: applied

case_text: The Federal Magistrate found that the Tribunal's conclusion as to relocation was open to it, and that in reaching this conclusion the Tribunal correctly applied the test for relocation: Randhawa v Minister for Immigration, Local Government and Ethnic Affairs (1994) 52 FCR 437. 17 Before discussing the submissions made on appeal, I should mention one puzzling aspect of the Tribunal's reasons, namely the inconsistency between dates of various incidents described by the appellant. The Tribunal records that the appellant gave evidence that he was arrested twice in 2001 (in June and July) and that he left Egypt some four months after the second arrest, that is in late October 2001; however the material in the appeal book shows, and the Tribunal's opening paragraph records, that the appellant arrived in Australia on 25 October 2002 and that his application for a protection visa was lodged on 9 January 2003. There is no suggestion that the appellant came other than directly to Australia. Although the Tribunal mentioned that a psychologist who examined the appellant referred to the appellant's account as being one of detention and torture in 2002 the Tribunal did not dwell on this point and, as mentioned above, the Tribunal specifically stated that it was relying only on the account that the appellant gave at the hearing; see [5] above. 18 The appellant's primary submission in this Court is that the Federal Magistrate erred in failing to find that the Tribunal misapplied the test for relocation, and in doing so made a jurisdictional error. I agree with this submission and, in general, with the submissions made by counsel for the appellant, Mr O'Donnell. 21 It must be emphasised here that it is the prospect of return to the applicant's own country not to a particular part or parts of that country that must be considered; Randhawa at 440. Provided that it is reasonably practicable for the person claiming refugee status to relocate with safety to another part of that country then it cannot be said that the person has a well-founded fear of persecution in that country. In such a case a finding that relocation meets these criteria will be a (or the) critical element in the determination of the application. Irrespective of the Tribunal's scepticism about aspects of the appellant's claims, is clear that the Tribunal's view as to the appellant's ability to relocate within Egypt with comparative ease was a critical element in its decision that the appellant did not have a well-founded fear of persecution. 22 The Tribunal's consideration of the relocation issue logically raised three separate questions: (a) If the appellant relocated elsewhere in Egypt, would he face persecution from those who had targeted him previously? (b) Had the appellant's persistent campaigning against religious inequalities given him a national profile, such that others in Egypt would persecute him even if he relocated ? (c) If the appellant relocated elsewhere in Egypt, would he continue to engage in campaigns against religious inequality? If so, would this conduct lead others in Egypt (or even just in the area to which he relocated) to persecute him? 23 The Tribunal clearly addressed questions 1 and 2 above and answered them adversely to the appellant. Counsel for the Minister submitted that the third question was effectively answered by the Tribunal's statement: 'He did not suggest that he would attract new harassment by continuing to engage in the same kinds of activity as he had in the past.' 27 The Minister did not accept that the Tribunal had overlooked an essential issue and submitted that the scope of the Tribunal's obligation to consider future persecution of an applicant if relocated is determined by the appellant's claims and the material before the Tribunal. The Minister relied upon the judgment of Black CJ in Randhawa at 443: 'I agree that it would ordinarily be quite wrong for a decision-maker faced with a relocation possibility to take the general approach that there must be a safe haven somewhere without giving the issue more specific attention, but the extent of the decision-maker's task will be largely determined by the case sought to be made out by an applicant .' (emphasis added) 28 In the Minister's submissions much was made of the fact that the relevant conduct of the appellant consisted of letter writing and the Tribunal could not be expected to investigate the possibility of the appellant facing persecution for his letter writing, which is not an activity that one would expect to provoke persecution. This is, with respect, a somewhat disingenuous submission. The appellant was not engaged in writing social letters; the Tribunal described him as embarking on 'a campaign of letter writing' which included letters of complaint to government departments. 29 Here, the questions of whether the appellant would continue his campaign of letter-writing in the future, and whether this conduct would lead to persecution elsewhere in Egypt, necessarily arose on the material before the Tribunal. It was the appellant's letter writing that the Tribunal accepted may have led to his unlawful detention by Giza police for three days. The Tribunal accepted that the appellant may have been beaten during this detention. It is no answer to say that letter writing per se is not an activity that tends to provoke violence the Tribunal had accepted that this was a possibility.


case_text: This interpretation takes too narrow a view of the meaning of the expression industrial conditions. There is nothing in the natural meaning of the expression which would prevent a requirement for union representation being described as an industrial condition. The statutory context suggests that such a requirement would fall within that description. The purpose of s 298K with s 298L(1)(l) is protective, that is to say, it is designed to prevent employees being prejudiced because they are dissatisfied with their working conditions where their union is taking steps to improve those conditions. Viewed this way the claim for union representation in the negotiation of a collective agreement falls within the statutory description. That view is supported by Webb v Nationwide News Pty Ltd (1985) 10 IR 252 at 283 where Wilcox J said: ... [a] term such as "industrial conditions" should be construed liberally and so as to embrace arrangements for consultation between employer and employee in relation to matters arising out of that relationship and relevant to the working environment of employees, as such. His Honour based that approach on the judgments delivered in Federated Clerks Union of Australia v Victorian Employers Federation [1984] HCA 53 ; (1984) 154 CLR 472 , which held that the wider term "industrial matters" included a claim that a union be consulted in relation to technological changes.


case_text: Again it is convenient to approach this ground in a way most favourable to the respondent without determining whether the approach is correct in law. The respondent contended that s 298L(1)(l) required the conditions sought by the union and the conditions about which the applicant employees were dissatisfied to be the same: Heidt v Chrysler Australia Ltd (1976) 13 ALR 365 at 375. Further, the respondent submitted that this fact was a condition precedent to the application of s 298V and, hence, the onus lay on the applicants to demonstrate the coincidence of conditions. Whilst I doubt that the respondent is correct in this second submission concerning the construction of s 298V, nothing turns on resolution of the issue because, accepting for the purposes of argument the approach proposed by the respondent, the facts of the case do not support the conclusion contended for by it. 115 There was evidence that at all times Mr Whelan pursued the aim of having the respondent negotiate a collective agreement with the union. This is what he told the employees who attended the off site meetings in November and on 1 December 2005. Then, at the union meeting on 9 December 2005 he advocated a role for the union in negotiating an agreement with the respondent. That, he told the meeting, was the way to improve terms and conditions of employment. At the end of the meeting there was a vote in favour of the union negotiating a collective agreement with the respondent, and Mr Whelan initiated a bargaining period immediately following the vote. Mr Thornton acknowledged that Mr Whelan constantly tried to get the respondent to negotiate an agreement with the union. 116 There was evidence that the applicant employees also wanted the respondent to negotiate a collective agreement with the union in order to achieve an improvement in conditions of employment. Mr Kemmis and Mr Coon expressly stated their positions at the meeting on 9 December 2005. Mr Taylor described himself as one of the "three amigos" who, together with Mr Kemmis and Mr Coon, were agitating for the respondent to engage with the union to negotiate improved conditions. They were dissatisfied with the situation in which Mr Thornton refused to negotiate with the union.


case_title: Jones v Dunkel (1959) 101 CLR 298

case_text: On the contrary, the evidence which I accept is that Mr Sathaar, to whom Mr Coon answered, praised Mr Coon for his work on 9 December 2005. Mr Sathaar is still employed by the respondent and was available to give evidence. He was not called. Consequently, the Court is able more confidently to conclude that the evidence of Mr Sathaar would not have assisted the respondent on this question and to accept the evidence of Mr Coon that he was praised for his work on the day: Jones v Dunkel (1959) 101 CLR 298 ( Jones v Dunkel ) 47 Then, the evidence of the nature of the failings in Mr Coon's work was unsatisfactory and cast doubt on the accusation that Mr Coon had failed to fulfil his duties. There were a number of allegations made by Mr Thornton against Mr Coon which were so extravagant or so lacking in detail as to make them improbable. There were sufficient occasions of such evidence as to indicate that Mr Thornton's accusations against Mr Coon should not be relied upon. 48 For instance, in [6] of the respondent's contentions filed on 10 July 2007 prior to the hearing and authored by Mr Thornton prior to the respondent securing legal representation, it was said: The second applicant was placed on a dimensional checking role which he performed very poorly and resulted in the respondent shipping incorrect work and receiving rectification costs of approx $250,000. The respondent was served with a notice to produce which sought production of any documents relating to these costs. The respondent produced a credit note dated 30 June 2007, for $50,000 in favour of Monodelphous Pty Ltd. This represented the amount accepted by the respondent for rectification costs of the dispatch of steel on 9 December 2005. When this document was put to Mr Thornton in cross examination he said that he did not mean the contentions to say that Mr Coon was responsible for the whole $250,000 rectification costs. He said that the paragraph was just poorly worded and was prepared by him without assistance. Having regard to the centrality and seriousness of the allegations made, these explanations were, and came across in the witness box as, unconvincing. Further, the credit note came into existence well after the dismissal and could not have been the reason for it. Perhaps sensing these shortcomings Mr Thornton took the opportunity shortly afterwards and following a lunch break to use a question in cross examination as a means to seek to retrieve the situation. The exchange was as follows: Well, you don't point us to any other instance of his alleged poor performance at any time than 9 December, do you?---Yes, well, I will say one thing, which was in relation to this $250,000, point six, which is made on the contentions of fact, saying that we had that he just worked that one day and we made $250,000 worth of errors that day. He didn't, but he was working for about two weeks prior in the beamline as a QO man, effectively letting errors go through, I believe, intentionally. When do you say he was working for two weeks in the beamline as a QO man?---You might need to ask Mr Coon exactly, but I spoke to Mr Sathaar at lunch time. He said, "No, he worked for about two weeks in the beamline as a like a QO person in the same role." You went and telephoned Mr Sathaar in the lunch break?---Am I not allowed to do that? Well - - -?---Sorry, I didn't realise that was something I wasn't allowed to do. It was explained to you, I think before the before we broke when we broke for lunch by your counsel that you weren't to be having any discussions over the break, wasn't it?---He said I couldn't talk to him. All right, but you thought you were at liberty to go off and speak to Mr Sathaar to find out the situation?---Well, if you want clarity on what happens, isn't that the best thing? 50 Further, the information was obtained over lunch from Mr Sathaar. Mr Thornton said, in effect, that this was the obvious thing to do because Mr Sathaar had the relevant information. And yet Mr Sathaar was not called to give evidence. He was supervising Mr Coon in the job as quality inspector and was present in the yard when, as Mr Thornton alleged, the errors were found. Mr Sathaar was involved in correcting the errors also. Mr Coon denied each of these facts. Mr Thornton also said that he and Mr Sathaar discussed Mr Coon's unsuitability for the job and the reasons for dismissing Mr Coon at the end of his trial period. It can be concluded from the failure of the respondent to call Mr Sathaar that he would not have assisted the respondent's case on these issues: Jones v Dunkel . 51 Another obstacle faced by the respondent in its argument that Mr Coon caused significant cost to the respondent by failing to inspect the steel in the yard properly was that Mr Thornton said that he, his father, and Mr Sathaar had to do the job which Mr Coon had failed to do. If this were so, and they had done the inspection, one would expect that there would have been no faulty steel dispatched on that day. Consequently, there would have been no rectification costs incurred. When faced with this suggestion in cross examination Mr Thornton responded that: ... I'm not sure we rechecked everything. 52 The lack of certainty expressed in this answer is at odds with Mr Thornton's evidence of his extreme level of anxiety arising from the circumstances of the day which Mr Thornton had previously described. 94 Both Mr Sathaar and Mr Thornton's father could have given evidence as to how far away from the meeting they were standing, whether they were checking steel as Mr Thornton said, and whether the speakers were audible to them. Both men were available to the respondent and are in its camp. Their absence from the witness box leads to the conclusion that their evidence would not have assisted the respondent: Jones v Dunkel . 95 I prefer the evidence of Mr Kemmis, Mr Coon and Mr Taylor that Mr Thornton was no more than 30 metres from the meeting. In particular Mr Taylor had a recollection of the location of the management group by reference to a particular door of the plate work factory. This was a level of detail not found in Mr Thornton's recollection. I also accept the evidence of Mr Taylor that the speakers aimed to have Mr Thornton hear what was said and that it was said loudly for Mr Thornton to hear. 96 I find that the evidence positively establishes that Mr Thornton was present within 30 metres of the meeting for the purpose of observing and listening to what was said. I further find that he heard Mr Coon and Mr Kemmis speak at the meeting in favour of union involvement in negotiating a collective agreement with the respondent, and he observed workers at the meeting vote in favour of this course.


case_title: Webb v Nationwide News Pty Ltd (1985) 10 IR 252


case_outcome: distinguished

case_title: Shipley v Masu Financial Management Pty Ltd [2008] NSWSC 252

case_text: Masu referred to Shipley v Masu Financial Services Pty Ltd [2008] NSWSC 252 , but that case is distinguishable for two reasons. The first reason is that Hammerschlag J noted (at [49]) that the argument before him appeared to proceed on the basis that Masu was a "responsible person" in relation to the Westpoint Products because it was within the notion of "either the issuer of the financial product or the person making the offer to sell the financial product". In the present case, however, Mr Stoyef relies exclusively on s 1012A on the basis that Masu provided financial product advice to Mr Stoyef and the group members, that consisted of or included a recommendation that they acquire the Westpoint Products. Accordingly, the only "responsible person" in the present case was the issuer of the Westpoint Product relevant to the particular investor, being either Westpoint or a Westpoint entity. The second reason is that the statement of claim in that case pleaded what a "proper" PDS of the kind that the defendant or its authorised representatives was required to give to the plaintiffs would have contained. In the present case, the relevant paragraphs of the further amended statement of claim do not use the word "proper" to qualify the PDS that was required to be given. 43 .There are, however, in my opinion, two pleading defects which Masu has identified. First, the words "at least" in para 42A are objectionable. Mr Curtin of counsel for Masu, submitted that his client is entitled to know now, rather than at trial, what is all of the particular information that Mr Stoyef says would have been included in the PDS which would have altered his and the group members' minds, because his client would like to investigate, or at least may choose to investigate, the question whether that information was known to "the responsible person" referred to in s 1013C(2)(a). 44 I agree. The proposed further amended statement of claim should omit the words "at least". If Mr Stoyef later wishes to allege that the hypothetical PDS would have contained further information that would have caused him and the group members not to invest, he will need to seek leave to amend further at that time.


case_text: The parties were in agreement that I could and should make a global order for costs relating to the proceedings. I am content to proceed on this basis: see Aiden Shipping Co Ltd v Interbulk Ltd (1986) 2 All ER 409 and Dr Martens Pty Ltd v Figgins Holdings Pty Ltd (No 2) [2000] FCA 602.


case_text: In Australian Conservation Foundation v Forestry Commission (1988) 81 ALR 166 Burchett J noted that the successful first respondent had raised a number of objections on which it failed, which added the last half day to the hearing. In exercising his discretion against the first respondent on this issue, his Honour held at 169: A party against whom an unsustainable claim is prosecuted is not to be forced, at his peril in respect of costs, to abandon every defence he is not sure of maintaining, and oppose to his adversary only the barrier of one hopeful argument: he is entitled to raise his earthworks at every reasonable point along the path of assault. At the same time, if he multiplies issues unreasonably, he may suffer in costs. Ultimately, the question is one of discretion and judgment. In my judgment, the competing considerations will be reflected, and justice will be done, if the costs to be recovered by the first respondent are shorn of any amount attributable to the last day of hearing.


case_title: BHP Billiton Iron Pty Ltd v National Competition Council [2006] FCA 1764


case_text: In Commissioner of the Australian Federal Police v Razzi (No 2) (1991) 30 FCR 64 at 69 Wilcox J said: In these days of extensive court delays and high legal costs the courts should use all proper means to encourage parties to consider carefully what matters they will put in issue in their litigation. If parties come to realise that they will not necessarily recover the whole of their costs, even though they have unsuccessfully raised a discrete issue, they are likely better to consider whether the raising of that issue is a justifiable course to take. 24 This approach was essentially adopted by Hodgson CJ in Permanent Trustee Australia Ltd v FAI General Insurance Co Ltd (unreported, Supreme Court of New South Wales, Hodgson CJ, 3 June 1998), where, after discussing the competing considerations of encouraging selectivity of issues and not penalising a party for supporting their case in every reasonable way, his Honour stated at 13: Apart from that consideration, in general terms I accept that if an issue is raised reasonably and is not disproportionate to the whole case, then normally the successful party should get his or her costs. However, particularly in relation to severable issues, the lesser the strength of the point raised and the greater the proportion it bears to the whole case, the more likely it is that the successful party may be deprived of costs; and if the Court comes to the view that it was unreasonable to raise the issue, then the successful party may have to pay the costs of that issue. See also Razzi 30 FCR 64; and Jamal v Secretary, Department of Health (1988) 14 NSWLR 252 at 271-272 per Mahoney JA.


case_title: Cretazzo v Lombardi (1975) 13 SASR 4

case_text: The power of the Court to make orders for costs derives from s 43 of the Federal Court of Australia Act 1976 (Cth). As a general rule, the successful litigant in a proceeding is entitled to receive its costs ordinarily, costs follow the event. The power to order costs is discretionary, although it must be exercised judicially and not against the successful party except for some good reason connected with the case: Milne v Attorney-General for the State of Tasmania [1956] HCA 48 ; (1956) 95 CLR 460 at 477; Ruddock v Vadarlis (No 2) [2001] FCA 1865 ; (2001) 115 FCR 229 at 234; and Cretazzo v Lombardi (1975) 13 SASR 4 at 11 per Bray CJ. It is well established that the discretion conferred on the Court is very wide, and enables the Court to respond to the wide variety of circumstances that may arise in relation to the making of costs orders. 13 Justice Toohey said in Hughes v Western Australian Cricket Association (Inc) [1986] ATPR 40-748 at 48,136: The discretion [in respect of costs] must of course be exercised judicially. There are decisions, both of Australian and English courts, that throw light on the way in which the discretion is to be exercised. I shall not refer to those decisions in any detail; I shall simply set out in a summary way what I understand to be their effect. 1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. Ritter v Godfrey [1920] 2 KB 47. 2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. Forster v Farquhar [1893] 1 QB 564. 3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, "issue" does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law. Cretazzo v Lombardi (1975) 13 SASR 4 at 12. There is no difficulty in stating the principles; their application to the facts of a particular case is not always easy. Also it is necessary to keep in mind the caveat by Jacobs J in Cretazzo v Lombardi at 16. His Honour sounded what he described as "a note of cautious disapproval" of applications to apportion costs according to the success or failure of one party or the other on the various issues of fact or law which arise in the course of a trial. His Honour commented: "But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues". These observations were approved by Cooper J (with whom Sheppard and Neaves JJ agreed) in Cummings v Lewis (1993) 41 FCR 559 at 602-603.


case_title: Cummings v Lewis (1993) 41 FCR 559

case_text: Justice Toohey said in Hughes v Western Australian Cricket Association (Inc) [1986] ATPR 40-748 at 48,136: The discretion [in respect of costs] must of course be exercised judicially. There are decisions, both of Australian and English courts, that throw light on the way in which the discretion is to be exercised. I shall not refer to those decisions in any detail; I shall simply set out in a summary way what I understand to be their effect. 1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. Ritter v Godfrey [1920] 2 KB 47. 2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. Forster v Farquhar [1893] 1 QB 564. 3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, "issue" does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law. Cretazzo v Lombardi (1975) 13 SASR 4 at 12. There is no difficulty in stating the principles; their application to the facts of a particular case is not always easy. Also it is necessary to keep in mind the caveat by Jacobs J in Cretazzo v Lombardi at 16. His Honour sounded what he described as "a note of cautious disapproval" of applications to apportion costs according to the success or failure of one party or the other on the various issues of fact or law which arise in the course of a trial. His Honour commented: "But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues". These observations were approved by Cooper J (with whom Sheppard and Neaves JJ agreed) in Cummings v Lewis (1993) 41 FCR 559 at 602-603. 17 Although, I note that Cooper J, in referring to the above passage of Wilcox J, in the decision of Cummings 41 FCR at 603 said: Wilcox J was of the view that to persist in a denial that the statements as found were made was unreasonable and was conduct which unreasonably prolonged the proceedings. It is no answer to say that a party is entitled to test the evidence to show that nothing was said which might amount to the representations as pleaded. A party always has that right in litigation. However, the question which is relevant to the issue as to costs is whether or not the exercise of that right, or the manner in which it was exercised, was reasonable in all the circumstances; and, whether the exercise of the right had the effect of unreasonably prolonging the proceedings. It was this issue which Wilcox J found against the respondents and upon which he based his decision. 18 There must be some element connected to the proceeding to make it fair and reasonable to deprive a successful litigant of its costs. A good reason not to follow the ordinary rule may arise because of the unreasonable or inappropriate conduct of the successful litigant. It may also arise where there is an ability to identify separate issues or inquiries where the successful litigant has failed. 19 There may be other circumstances in which there needs to be some qualification to the starting point of presuming that the successful party is entitled to its costs where justice requires it. Any determination will always depend on the circumstances arising for the decision of the judge who has conducted the trial and who is considering the appropriate order as to costs. 21 The fact that a successful party has lost on a particular issue or inquiry does not necessarily mean that the party has acted in the litigation inappropriately or unreasonably. Nevertheless, in certain circumstances, it may be an appropriate exercise of the court's discretion to apportion costs according to success or failure on a particular distinct or severable issue or inquiry irrespective of any inappropriate or unreasonable behaviour on the part of the successful party: see Cummings 41 FCR at 599-604; Hughes [1986] ATPR at 48,136.


case_title: Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd) v Lane Industries Pty Ltd (1993) 26 IPR 261

case_text: Considerations of public policy and, in particular, the need for greater economy and efficiency in the conduct of litigation are relevant considerations in the exercise of the discretion when considering whether a successful party is entitled to all its costs: see, e.g. Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd) Lane Industries Pty Ltd (1993) 26 IPR 261 at 271-272. 47 It is sometimes preferable after apportioning issues as I have done to avoid leaving the quantification and fixing of costs of those issues to taxation. I am mindful that an allocation of costs in the case of a mixed result can rarely be achieved with mathematical precision and such is not necessary: Dodds 26 IPR at 272 per Gummow, French and Hill JJ. Unfortunately, I do not have any appropriate material to estimate the amount of costs or time spent on the preparation and consideration of the economic test prior to trial, and so cannot make any percentage apportionment of the costs to be discounted. I therefore propose to order a deduction in the costs awarded to the NCC by reference to the NCC's points of defence and amended points of defence which will unfortunately leave the quantification and fixing of costs of the economic test issue to taxation in default of agreement between the relevant parties. 48 Therefore, I propose to order as follows: In proceeding number VID 1641 of 2004: 1. The costs of the proceeding be assessed and taxed together with proceeding number WAD 39 of 2005. 2. The applicant pay the first respondent's costs of the proceeding, excluding the first respondent's costs solely of or in connection with the positive contentions stated in paragraph 16 in the first respondent's points of defence dated 8 April 2005 and paragraph 17 in the first respondent's amended points of defence dated 25 September 2006. 3. The applicant pay the second respondent's costs of the proceeding. In proceeding number WAD 39 of 2005: 1. The costs of the proceeding be assessed and taxed together with proceeding VID 1641 of 2004. 2. The first-named second respondent pay the applicant's costs of the proceeding. 3. The first-named second respondent pay the first respondent's costs, excluding the first respondent's costs solely of or in connection with the positive contentions stated in paragraph 37 in the first respondent's points of defence dated 2 May 2005 and amended points of defence dated 25 September 2006. I certify that the preceding forty-eight (48) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Middleton. Associate: Dated: 18 April 2007 Counsel for the Applicant in VID 1641/04 and the First-named Second Respondent in WAD 39/05: P Crutchfield Solicitor for the Applicant in VID 1641/04 and the First-named Second Respondent in WAD 39/05: Blake Dawson Waldron Counsel for the First Respondent in both proceedings: C Scerri QC Solicitor for the First Respondent in both proceedings: Clayton Utz Counsel for the Second Respondent in VID 1641/04 and the Applicant in WAD 39/05: N O'Bryan SC Solicitor for the Second Respondent in VID 1641/04 and the Applicant in WAD 39/05: DLA Phillips Fox Date of Hearing: 8 March 2007 Date of Judgment: 19 April 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/557.html


case_text: The parties were in agreement that I could and should make a global order for costs relating to the proceedings. I am content to proceed on this basis: see Aiden Shipping Co Ltd v Interbulk Ltd (1986) 2 All ER 409 and Dr Martens Pty Ltd v Figgins Holdings Pty Ltd (No 2) [2000] FCA 602. 22 As Goldberg J observed in Dr Martens [2000] FCA 602 at [54] : [A] court should be reluctant to embrace the proposition that, as a general rule, it is appropriate to undertake an enquiry as to who was successful in relation to particular issues in a case to determine whether there should be an apportionment of costs against a successful party. A court should not be too ready to disallow costs simply because a party has failed upon an issue, unless it be quite a separate and distinct issue from the issues in respect of which it succeeded or unless there be some element of unreasonableness or inappropriate conduct in relation to that issue: cf Verna Trading Pty Ltd v New India Assurance Pty Ltd [1991] 1 VR 129 at 152-154. 23 It seems appropriate when considering separate and distinct issues or inquiries, where there is no element of unreasonableness or inappropriate behaviour on behalf of the successful litigant, to consider appropriate case management principles, the relative merits or strengths of the lost issue or inquiry, whether the length of the proceedings had been greatly increased by the lost issue or inquiry on which the successful party failed, and whether the issue or inquiry on which the successful party failed otherwise was of sufficient significance in proportion to the whole case to warrant a special order to deprive that party of the costs of that issue.


case_text: It is significant to recall that all parties needed to confront the principal question in the proceedings on the basis there existed only one previous decision of the Court that of Hamersley Iron Pty Ltd v National Competition Council (1999) 164 ALR 203 (' Hamersley ') which dealt with the interpretation of the term "use of a production process" within s 44B of the Act and which involved a very similar factual scenario to the proceedings. Fortescue's principal contention was that, applying the "marketable commodity" test to the factual scenario as contended for by Fortescue, a "marketable commodity" was produced in BHPBIO's operations before the iron ore was railed to the port. As an alternative contention, Fortescue sought to distinguish Hamersley on a number of grounds. 30 BHPBIO had good legal grounds for its position and conducted itself in the litigation reasonably and appropriately. Nevertheless, BHPBIO was the losing party, and Fortescue would ordinarily be entitled to its costs. However, despite Fortescue's ultimate success in the proceedings, I did not find in favour of Fortescue on certain factual and legal issues or inquiries. Nevertheless, I do not consider it appropriate in the circumstances to disentitle Fortescue to its whole costs in the proceedings. 31 The conduct of Fortescue in this proceeding was neither inappropriate nor unreasonable. Fortescue structured its case primarily on the basis of the correctness of the decision in Hamersley . Therefore, it seems to me that seeking to apply the "marketable commodity" test as expounded in that decision was an entirely appropriate and reasonable approach. Further, it seems to me that Fortescue seeking in the alternative to distinguish the Hamersley decision on a number of grounds was similarly appropriate and reasonable. In addition, I do not see any inappropriate or unreasonable behaviour on the part of Fortescue in its approach to putting BHPBIO to proof on factual matters or contentions. The Court accepted in essence the actual process and operations as contended for by BHPBIO. However, the conclusions of the Court were determined objectively and not by reference to BHPBIO's own subjective views or characterisations, or by reference to the subjective views or characterisations of the witnesses called on behalf of BHPBIO. Fortescue was entitled to test the evidence put forward by BHPBIO, especially in respect of such subjective views and characterisations. 32 In Hamersley , the learned trial judge held the term "production process" meant "a series of operations by which a marketable commodity is created or manufactured": at 213. The test required, as a question of "fact and degree", a consideration of "the actual operation of the activities in question, considered as a whole": at 213. The evidence as to "marketable commodity", whilst it may be separately identified, was all part of the material the Court needed to consider in determining the actual operation of the activities in question. Accordingly, it does not seem unreasonable for Fortescue to have approached in the way it did the material placed before the Court. The principal question for determination in the proceedings was not a mere matter of statutory interpretation of the term "the use of a production process" that could be dealt with by demurrer. Rather, the Court was required to consider, in detail, the factual evidence of BHPBIO's operations and apply the construction of the term "the use of a production process", whether that construction be the one set out in Hamersley , or the construction for which the Court ultimately found. There does not seem to me to be any element of unreasonableness or inappropriateness in Fortescue directing its evidence, submissions and cross-examination to the application of that test to the facts of this case. 33 This is not the end of the inquiry. As I have indicated, the exercise of the discretion to make an order as to costs is not just limited to a consideration of the reasonableness or appropriateness of the conduct of a party in connection with the proceedings. It may also be appropriate to discount an order in favour of a successful litigant in circumstances where it has lost certain issues or inquiries which can clearly be treated as distinct and severable. 34 At the outset, I do not consider that the matters upon which Fortescue was unsuccessful were relevantly distinct or severable although they can be identified. Rather, the matters on which Fortescue was unsuccessful were alternative arguments in support of the one principal question in the proceedings, that is, whether either of the relevant services was a "service" within the meaning of s 44B of the Act. The matters raised by Fortescue were sufficiently linked to this principal question in the proceedings. Fortescue did not seek to raise a separate matter for determination by way of a positive defence. 35 However, to the extent the issues or inquiries upon which Fortescue lost can be identified, and even if they be relevantly distinct and severable, in my view, none of the matters sought to be addressed by Fortescue were so disproportionate to the whole case, or so lacked merit, or so adversely impacted upon the economy and efficiency of the proceedings, according to case management principles, as to warrant an order to deprive Fortescue of some or all of its costs. As I have said, I was required to consider in detail the factual evidence and apply that evidence to the construction of the term "use of a production process", which Fortescue reasonably contested. The ultimate ends of justice would not be served by Fortescue not recovering its costs because of its failure on some identifiable (or even distinct and severable) issues or inquiries, when those issues or inquiries needed to be canvassed as being material to the reaching of a decision.


case_text: In Hamersley Iron Pty Ltd v National Competition Council [1999] FCA 1078 , Kenny J considered the apportionment of costs and reduced the costs awarded to the successful applicant to reflect, amongst other things, costs associated with certain affidavit evidence ruled to be inadmissible. 44 Similarly, here, a reduction of costs awarded to NCC would be appropriate in view of my rejection of the economic test. This was an issue which could be treated as clearly distinct and severable, it being in effect a positive contention raised by the NCC in its points of defence and amended points of defence, which had little merit and did add to the costs of preparation of the parties for trial. Whilst I do not have sufficient material to assess such costs, I am satisfied they are not merely minimal. 45 Professor Rey (the economic expert called on behalf of the NCC) and the other economic experts before me agreed that the term "production process" had no technical or specialised meaning in economics. In these circumstances, it is difficult to see how the economic test could be relevant to the contention that Hamersley was wrongly decided or could provide an appropriate replacement test.


case_text: Justice Toohey said in Hughes v Western Australian Cricket Association (Inc) [1986] ATPR 40-748 at 48,136: The discretion [in respect of costs] must of course be exercised judicially. There are decisions, both of Australian and English courts, that throw light on the way in which the discretion is to be exercised. I shall not refer to those decisions in any detail; I shall simply set out in a summary way what I understand to be their effect. 1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. Ritter v Godfrey [1920] 2 KB 47. 2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. Forster v Farquhar [1893] 1 QB 564. 3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, "issue" does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law. Cretazzo v Lombardi (1975) 13 SASR 4 at 12. There is no difficulty in stating the principles; their application to the facts of a particular case is not always easy. Also it is necessary to keep in mind the caveat by Jacobs J in Cretazzo v Lombardi at 16. His Honour sounded what he described as "a note of cautious disapproval" of applications to apportion costs according to the success or failure of one party or the other on the various issues of fact or law which arise in the course of a trial. His Honour commented: "But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues". These observations were approved by Cooper J (with whom Sheppard and Neaves JJ agreed) in Cummings v Lewis (1993) 41 FCR 559 at 602-603. 21 The fact that a successful party has lost on a particular issue or inquiry does not necessarily mean that the party has acted in the litigation inappropriately or unreasonably. Nevertheless, in certain circumstances, it may be an appropriate exercise of the court's discretion to apportion costs according to success or failure on a particular distinct or severable issue or inquiry irrespective of any inappropriate or unreasonable behaviour on the part of the successful party: see Cummings 41 FCR at 599-604; Hughes [1986] ATPR at 48,136.


case_text: This approach was essentially adopted by Hodgson CJ in Permanent Trustee Australia Ltd v FAI General Insurance Co Ltd (unreported, Supreme Court of New South Wales, Hodgson CJ, 3 June 1998), where, after discussing the competing considerations of encouraging selectivity of issues and not penalising a party for supporting their case in every reasonable way, his Honour stated at 13: Apart from that consideration, in general terms I accept that if an issue is raised reasonably and is not disproportionate to the whole case, then normally the successful party should get his or her costs. However, particularly in relation to severable issues, the lesser the strength of the point raised and the greater the proportion it bears to the whole case, the more likely it is that the successful party may be deprived of costs; and if the Court comes to the view that it was unreasonable to raise the issue, then the successful party may have to pay the costs of that issue. See also Razzi 30 FCR 64; and Jamal v Secretary, Department of Health (1988) 14 NSWLR 252 at 271-272 per Mahoney JA.


case_text: The ordinary rule applies even though the losing party may have had good legal grounds for its stance and conducted itself reasonably and appropriately: see Ruddock 115 FCR at 235. In exercising its discretion, the court is looking at the matter primarily from the perspective of the successful litigant: see Latoudis v Casey [1990] HCA 59 ; (1990) 170 CLR 534 at 542-3 per Mason CJ; 564 per McHugh J. 20 However, it is to be observed that ordinarily a discount is applied, or said to apply, because of the inappropriate or unreasonable conduct of the successful party: see Ruddock 115 FCR at 236-237 and Latoudis 170 CLR at 544 per Mason CJ; 565-566 per Toohey J.


case_text: The power of the Court to make orders for costs derives from s 43 of the Federal Court of Australia Act 1976 (Cth). As a general rule, the successful litigant in a proceeding is entitled to receive its costs ordinarily, costs follow the event. The power to order costs is discretionary, although it must be exercised judicially and not against the successful party except for some good reason connected with the case: Milne v Attorney-General for the State of Tasmania [1956] HCA 48 ; (1956) 95 CLR 460 at 477; Ruddock v Vadarlis (No 2) [2001] FCA 1865 ; (2001) 115 FCR 229 at 234; and Cretazzo v Lombardi (1975) 13 SASR 4 at 11 per Bray CJ. It is well established that the discretion conferred on the Court is very wide, and enables the Court to respond to the wide variety of circumstances that may arise in relation to the making of costs orders.


case_text: The position of the NCC is slightly different. Subject to one matter, it seems to me that the NCC is entitled to its costs of the proceedings as a successful litigant. The NCC adopted an appropriate role in the proceedings consistent with its statutory responsibilities: see National Competition Council v Hamersley Iron Pty Ltd (1999) 167 ALR 109 at 114. The NCC did successfully contend that Hamersley was clearly wrong. 38 However, the court has a general discretion in relation to costs even where a statutory body is acting in a limited role before the court: see generally Re Dr Ken Michael AM; Ex parte Epic Energy (WA) Nominees Pty Ltd [2002] WASCA 231 (S) at [18]. 39 In my view, there was a clear separate and distinct inquiry or issue upon which the NCC was unsuccessful, and which it sought positively to contend, namely the economic test.


case_title: Permanent Trustee Australia Ltd v FAI General Insurance Co Ltd (unreported, Supreme Court of New South Wales, Hodgson CJ, 3 June 1998)


case_title: Roberts v Rodier [2006] NSWSC 1084

case_text: I should interpolate that there may not need to be the ability to precisely identify separate costs in respect of particular issues. As Campbell J said in Roberts v Rodier [2006] NSWSC 1084 at [33] : ... I do not accept that the appropriate way of exercising the costs discretion is limited to the identification of separate costs of particular issues. It could sometimes be within the scope of a proper exercise of discretion, where the costs of certain evidence was relevant to issues on which a plaintiff succeeded and also to issues on which the plaintiff failed, to decide to allow the plaintiff a proportion only of those costs. 26 Whilst the cases referred to above throw light on the relevant principles to be applied in the exercise of the discretion, their application to the facts of a particular case is sometimes difficult when competing considerations apply. 27 As I understand the principles relevant to my task, they can be summarised as follows: 1. A successful litigant is ordinarily entitled to its costs even if the losing party had good legal grounds for its position and conducted itself in the litigation reasonably and appropriately; 2. The successful litigant will be so entitled to its costs unless some good reason connected to the case is shown to the contrary; 3. Without limiting the general discretion available, a good reason to the contrary may arise: 3.1 Where the conduct of the successful litigant in connection with the case was unreasonable or inappropriate; 3.2 Where no such unreasonable or inappropriate conduct of the successful litigant is found, but nevertheless there were clearly distinct and severable issues or inquiries that were lost by the successful litigant; 4. If the conduct of a successful litigant was inappropriate or unreasonable in connection with the case, the successful litigant will usually be denied all or part of its costs; 5. Where the court is considering the question of costs in respect of a lost distinct or severable issue or inquiry, which can clearly be treated as distinct and severable, then to determine whether the successful party will lose some or all of its costs, it will be necessary to consider and weigh up case management principles, the significance of the issue or inquiry in proportion to the proceeding as a whole, and whether the issue or inquiry had any relative strength or merit; 6. The court has the discretion to apportion costs even if it cannot identify separate costs in respect of distinct or severable issues or inquiries on which the successful litigant failed, but the matters on which the party failed must be at least capable of separation from the matters on which the litigant was successful.


case_text: The power of the Court to make orders for costs derives from s 43 of the Federal Court of Australia Act 1976 (Cth). As a general rule, the successful litigant in a proceeding is entitled to receive its costs ordinarily, costs follow the event. The power to order costs is discretionary, although it must be exercised judicially and not against the successful party except for some good reason connected with the case: Milne v Attorney-General for the State of Tasmania [1956] HCA 48 ; (1956) 95 CLR 460 at 477; Ruddock v Vadarlis (No 2) [2001] FCA 1865 ; (2001) 115 FCR 229 at 234; and Cretazzo v Lombardi (1975) 13 SASR 4 at 11 per Bray CJ. It is well established that the discretion conferred on the Court is very wide, and enables the Court to respond to the wide variety of circumstances that may arise in relation to the making of costs orders. 14 The ordinary rule applies even though the losing party may have had good legal grounds for its stance and conducted itself reasonably and appropriately: see Ruddock 115 FCR at 235. In exercising its discretion, the court is looking at the matter primarily from the perspective of the successful litigant: see Latoudis v Casey [1990] HCA 59 ; (1990) 170 CLR 534 at 542-3 per Mason CJ; 564 per McHugh J. 20 However, it is to be observed that ordinarily a discount is applied, or said to apply, because of the inappropriate or unreasonable conduct of the successful party: see Ruddock 115 FCR at 236-237 and Latoudis 170 CLR at 544 per Mason CJ; 565-566 per Toohey J.


case_text: In Health & Life Care Ltd v SA Asset Management Corp [1995] SASC 5514 ; (1995) 18 ACSR 153 , the Full Court of the Supreme Court of South Australia dealt with the question of construction of reg 5.6.24 and the principles of election relating to the surrender of a security by a secured creditor. Doyle CJ (with whom Duggan and Nyland JJ agreed) said at 158 that: ...reg 5.6.24(3) refers to a creditor who has voted in respect of his or her whole debt or claim...When a vote is taken on the voices or by a show of hands each creditor who votes does so simply in the capacity of a creditor. The Chief Justice went on to say that in his opinion: ...it cannot be said that a creditor who votes on the voices (or by a show of hands) votes in respect of the value of the debt or claim. 20 It is plain on the evidence before me that this is what occurred in the present case. It follows from what Doyle CJ said that the provisions of reg 5.6.24(3) were not enlivened. This regulation contains a statement of one situation in which a secured creditor is deemed to have surrendered his or her security. However, as I have said, that provision is not enlivened in the present case and it is unnecessary to further consider this issue. 22 Doyle CJ in Health & Life Care went on at 162 to explain the relationship between reg 5.6.24 and the provisions of s 554E of the Act. It is evident that even if the provisions of the regulations are not applicable, there may nonetheless amount to conduct on the part of a secured creditor which would constitute an election within the principles stated in Sargent v ASL .


case_text: Dutney JA went on to refer to two earlier decisions, one of which ( Re Douglas Homes Qld Pty Ltd (in liq) [1980] Qd R 528) dealt with the submission of a proof of debt. It was observed in Re Douglas Homes that the proof of debt was some evidence of an election to surrender but it is not by itself conclusive evidence.