Menzies v Owen[2015] QCAT 326

REASONS FOR DECISION

1. [1]
   On 17 December, 2014 a decision in this matter was published.  The parties were ordered to file and serve any submissions in relation to costs.
2. [2]
   The applicants ask that the Tribunal fix the amount of their costs at $25,000 being a reduced amount of the estimate of their costs using the scale of costs for the District Court.
3. [3]
   It is submitted that the circumstances of this matter are such that it is in the interests of justice that costs follow the cause and that an order should be made in their favour.
4. [4]
   The respondent submits that there is no proper basis for making an order as to costs, nor should the Tribunal in the exercise of its discretion make an order as to costs. The respondent submits that the usual rule should apply pursuant to s 100 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act), so that each party bears their own costs in the proceeding.

Issues

5. [5]
   The following questions are raised:

   1. (a)
      whether I should continue to determine this matter, in light of public comments made by the respondent following publication of the decision?^[1]
   2. (b)
      does the arrangement the applicants have with the Caxton Legal Centre, in relation to representation in this matter, affect the ability of the applicants to recover costs of the proceeding?
   3. (c)
      do the factors relied upon by the applicants point so compellingly to a costs award that they overcome the strong contra-indicator against costs orders in s 100 of the QCAT Act?^[2]
6. [6]
   In relation to the first issue, neither party has submitted that I should withdraw from the matter.  I do not consider there is any reason to do so.
7. [7]
   In relation to the second issue, the Caxton Legal Centre is a community legal centre, which commonly provides legal services to its clients free of cost.  In this case it has included in its retainer with the applicants a right to recover the costs of its professional services. However, it has agreed to waive those costs in the event the costs cannot be recovered from another party. I am satisfied, on the basis of the authorities cited by the applicants that because of the terms of the retainer, there is no obstacle to the making of a costs order in favour of the applicants, as would have been the case if they had no liability for solicitor and own client costs.^[3]

Is it in the interests of justice to make a costs order?

8. [8]
   Section 100 of the QCAT Act provides that other than as provided under the Act or an enabling Act, each party to a proceeding must bear the party’s own costs for the proceeding. The applicants acknowledge that the facts of this case must point in a compelling way to a costs order being made in the “interests of justice”, as contemplated by s 102 of the QCAT Act. By reference to the matters set out in s 102 of the QCAT Act, the applicants submit that the Tribunal should consider the following factors, in the exercise of its discretion.

   1. (a)
      The respondent conducted the proceeding in a way that unnecessarily disadvantaged the applicants, in terms of reliance on a prolix written defence, refusing to narrow the issues, and lateness in delivery of his material.

As the applicants bear the onus of proof in the matter, I do not consider the way in which the respondent conducted his defence, up to the date of hearing, significantly impacted on the matters the applicants were required to prove in any event. As it transpired, I do not think the hearing was unnecessarily lengthened by the respondent’s defence.

2. (b)
   The proceedings were complex both factually and legally.

I agree that the proceedings were complex and that legal representation was justified.

3. (c)
   The nature of the complaint upheld by the Tribunal involved the protection of human rights and was of significant public interest.

I agree that the protection of human rights was involved. I am not satisfied on the submissions or the evidence that the matter was one of public interest which would confer a beneficial costs position in the way contemplated in Oshlack v Richmond River Council.^[4] The proceedings were not brought on a representative basis, but rather involved the individual claims of the applicants.

4. (d)
   The fact that the respondent claims to be an undischarged bankrupt should not prevent an award of costs against him.

In this regard, there is no impediment to a costs order being made.^[5]  Given the length of time available to the applicants to recover a judgment debt, I accept that the order may not be futile.

5. (e)
   The applicants were successful in three out of six of the complaints the subject of the proceedings and were required to engage in lengthy and complex legal proceedings spanning some 8 years and necessitating legal representation.  Costs are only sought in relation to proceedings in this Tribunal, however, it is submitted that it is relevant to note the overall history of the matter.

I agree that this matter has involved extensive litigation between the parties spanning many years. However, the question of costs associated with each piece of litigation is specific to each case. That is not a matter to which I accord any weight in the exercise of my discretion.

6. (f)
   It is in the interests of justice that a community legal centre recovers its costs of litigating a matter of public interest, where it is substantially successful and given the extensive resources that were required to do so.

With respect, I consider the first question is whether it is in the interests of justice for the applicants to be awarded costs rather than whether it is in the interests of justice for their representatives to recover the outlay made in supporting this litigation.^[6]

7. (g)
   In their submissions in reply the applicants made a further submission that the Tribunal should make a costs order against the respondent in order to deter him from continuing to act in a vilifying manner.

I reject this submission on the basis that the purpose of a costs order is not to punish a party, but rather to meet the successful party’s costs incurred in the proceeding.^[7]

9. [9]
   I have agreed with the applicants that it is possible a costs order against the respondent may be recovered despite his bankruptcy. I have agreed that the litigation has been factually and legally complex, justifying legal representation.  It is a matter of judgment and degree, however, on balance I do not consider these factors point so compellingly to a costs award that they overcome the strong contra-indicator against costs orders in s 100 of the QCAT Act. This is not a case where the benefits of the applicants’ success would be eroded by being required to bear their own costs.^[8] I say this because the applicants did not seek an award of damages at the hearing.  The order made was for an apology to be given by the respondent. Not having a costs order does not erode that order.  In terms of the reasoning of Keane J, as he then was in Tamawood’s case, this amounts to a countervailing consideration against the proposition that it is in the interests of justice to award costs where a party reasonably incurred the costs of legal representation, because not to award costs would allow the party’s success to be eroded.^[9]
10. [10]
    I am entitled to give consideration to the outcome of the proceeding and the nature of the Order made by virtue of s 102(f) of the QCAT Act.
11. [11]
    The respondent submits that there are 8 reasons why the applicants have failed to sufficiently demonstrate that the usual rule should be displaced or why the discretion should be exercised to order costs. For completeness I will deal with the respondent’s submissions. They are:

    1. (a)
       3 of the original 5 applicants discontinued their claims in 2012, but for many years the respondent was the subject of their allegations.

12. [12]
    Although the respondent’s submissions have largely been rejected, I have nevertheless found in the exercise of my discretion that the interests of justice do not require that a costs order be made in favour of the applicants.
13. [13]
    I order that each party bear their own costs of the proceeding.