When are there special circumstances to depart from usual rule as to costs?

By Rohan White, Partner and Nicola Johnson, Partner

Key points:

  • The courts will not depart from the usual rule that costs follow the event merely because the unsuccessful party has appointed a litigation guardian or is represented by pro bono legal counsel
  • It will also be insufficient to merely show that the proceedings concerned novel questions of statutory construction and/or that the proceedings may affect persons beyond the parties to the litigation.

It is generally the case that the primary factor in deciding the question of the award of costs is the outcome of the litigation. That is, the unsuccessful party will usually be required to pay the successful party’s costs of the proceedings and the courts will only depart from this rule if special circumstances are shown to exist.[1]

Although there is no exhaustive list of matters that may constitute “special circumstances”, the recent Full Court decision in Plaintiff B9/2014 v Minister for Immigration and Border Protection (No 2) [2015] FCAFC 27 (Plaintiff B9/2014) provides further guidance on the type of matters that may warrant a departure from the usual rule.

In Plaintiff B9/2014, the appellant was a minor who unsuccessfully (at both first instance and on appeal) sought judicial review of a decision made by a delegate of the respondent his application for a protection visa was invalid. In relation to the issue of costs, the appellant argued that the following “special circumstances” warranted the Court ordering that there should be no order as to the costs of the appeal:

  1. It was necessary for the litigation guardian (the appellant’s mother) to commence the proceedings as the infant appellant was incapable of otherwise protecting his own interests.
  2. The proceedings raised novel and important questions of law concerning the deprivation of liberty of an individual and the operation of the Migration Act.
  3. Parliament passed laws after the proceeding was on foot restricting the appellant’s further avenue of appeal or other judicial review.
  4. There was no potential financial gain to either the appellant or his mother as litigation guardian.
  5. The appellant’s legal representation was provided on a pro bono basis.

The Full Court was not satisfied that these matters constituted special circumstances. In particular, the Full Court held that:

  • Although the appellant could only commence and conduct the proceeding through a litigation guardian (who was liable for any adverse costs order) and the litigation guardian would not, at least directly, have received any benefit from the appellant’s success in the proceeding but was instead motivated to protect the rights of her child, this did not diminish the applicability of the rule that costs generally follow the event.[2]
  • The appeal was concerned with construction of provisions of the Migration Act, but did not involve any broader questions concerning the extent of executive power of the Commonwealth or Australia’s obligations under international law.
  • It was common for proceedings to be brought involving questions of construction of particular provisions of the Migration Act. In that respect, the case was no different to many others. Further, whilst the appeal (which concerned the rights of a child) evoked sympathy, this did not of itself militate against the usual order as to costs.
  • The proceeding was not one that directly concerned the appellant’s liberty.
  • It was a common feature of cases involving the construction of a statutory provision that the Court’s decision has consequences beyond the interests of the immediate parties. The fact that there may be broader consequences of the Court’s decision should not weigh significantly upon the question of costs.
  • The effect of legislative changes that were not relevant to the resolution of the proceedings was not a relevant factor in relation to the issue of costs.
  • The fact that the appellant was provided with pro bono legal advice was not, of itself, a factor that should deprive the successful party of its costs.[3]

As can be seen from the Full Court’s decision, it is a high bar to overcome to persuade the court to depart from the usual rule that costs follow the event. The special circumstances required to depart from this rule will only arise in rare cases, such as where the matter concerns issues of high public importance and/or the liberty of individuals who were unable to take action on their own behalf to determine their rights.[4]

 

 

[1] See Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 234 [11]; Oshlack v Richmond River Council (1998) 193 CLR 72, 97 (McHugh J) and 120-123 (Kirby J); Seven Network Ltd v News Ltd 2009) 182 FCR 160, 403; State of Victoria v Sportsbet Pty Ltd (No 2) [2012] FCAFC 174 at [6]-[7]; and Gondarra v Minister for Families, Housing, Community Services and Indigenous Affairs [2014] FCA 139 at [6].

[2] See, for example, Oshlack v Richmond River Council op. cit; Bat Advocacy NSW Inc v Minister for Environment Protection, Heritage and the Arts (No 2) (2011) 280 ALR 91, 95.

[3] See, for example, Microsoft Corporation v Marks (No 2) (1996) 69 FCR 144 at 146 (Lindgren J, with whom Beaumont and Lehane JJ agreed); Gondarra at [13] (Kenny J)

[4] As occurred, for example, in Ruddock v Vadarlis (No 2) op. cit.

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When are there special circumstances to depart from usual rule as to costs?