Federal Court of Australia Clarence City Council v Commonwealth of Australia (costs) [2024] FCAFC 47 Appeal from: Clarence City Council v Commonwealth of Australia [2022] FCA 1492 File numbers: TAD 3 of 2023 TAD 4 of 2023 Judgment of: MARKOVIC, STEWART AND ANDERSON JJ Date of judgment: 11 April 2024 Catchwords: COSTS – costs of appeal – where unsuccessful appellants successful on an issue raised by notices of contention – whether appropriate to apportion costs on an issue basis – whether a discrete issue Cases cited: Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 Chou v Metstech Pty Ltd [2023] FCAFC 205 Clarence City Council v Commonwealth of Australia [2024] FCAFC 8 Commissioner of Taxation v Bosanac (No 2) [2022] FCAFC 5 Division: General Division Registry: Tasmania National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Number of paragraphs: 6 Date of last submission: 7 March 2024 Date of hearing: Determined on the papers. Counsel for the Appellants: K Cuthbertson SC and M Norton Solicitor for the Appellants: Simmons Wolfhagen Counsel for the First Respondent: C Lenehan SC and N Wootton Solicitor for the First Respondent: HWL Ebsworth Lawyers Counsel for the Second Respondent: N Owens SC and L Coleman Solicitor for the Second Respondent in TAD 3 of 2023: Corrs Chambers Westgarth Solicitor for the Second Respondent in TAD 4 of 2023: King & Wood Mallesons ORDERS TAD 3 of 2023 BETWEEN: CLARENCE CITY COUNCIL Appellant AND: THE COMMONWEALTH OF AUSTRALIA First Respondent HOBART INTERNATIONAL AIRPORT PTY LTD (ACN 080 919 777) Second Respondent AND BETWEEN: HOBART INTERNATIONAL AIRPORT PTY LTD (ACN 080 919 777) Cross-Appellant AND: THE COMMONWEALTH OF AUSTRALIA Cross-Respondent order made by: MARKOVIC, STEWART AND ANDERSON JJ DATE OF ORDER: 11 April 2024 THE COURT ORDERS THAT: 1. The appellant pay the second respondent's costs, as taxed or agreed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. ORDERS TAD 4 of 2023 BETWEEN: NORTHERN MIDLANDS COUNCIL Appellant AND: THE COMMONWEALTH OF AUSTRALIA First Respondent AUSTRALIA PACIFIC AIRPORTS (LAUNCESTON) PTY LTD (ACN 081 578 903) Second Respondent AND BETWEEN: AUSTRALIA PACIFIC AIRPORTS (LAUNCESTON) PTY LTD (ACN 081 578 903) Cross-Appellant AND: THE COMMONWEALTH OF AUSTRALIA Cross-Respondent order made by: MARKOVIC, stewart and anderson jJ DATE OF ORDER: 11 april 2024 THE COURT ORDERS THAT: 1. The appellant pay the second respondent's costs, as taxed or agreed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT THE COURT: 1 On 15 February 2024, we dismissed the appeals in these two matters and we provided for the parties to make written submissions on costs: Clarence City Council v Commonwealth of Australia [2024] FCAFC 8. They have done that. For the reasons that follow, we are satisfied that the appellants should pay the costs of the second respondent in each appeal, and that the first respondent, the Commonwealth, should bear its own costs. 2 Dealing first with the Commonwealth, notwithstanding its success in the appeals it proposes that it bear its own costs. No other party demurs from that, and no-one seeks a costs order against the Commonwealth. Its proposal should accordingly be accepted. 3 As regards the costs between the appellant councils and the respondent airports, the appellants accept that the principal "event" on which the costs should turn is their loss in the appeals. However, they submit that because the airports were unsuccessful on the first ground of their notices of contention, which they submit is a discrete issue, the costs to be awarded to the airports should be reduced by 10%. The figure of 10% is arrived at by taking a rough and ready approach to the assessment of how much time and effort was taken up with the relevant ground in the notices of contention having regard to the written and oral submissions. If it is appropriate to apportion costs on an issue basis, that is an appropriate approach to the apportionment exercise: Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [5]. 4 Strictly speaking, ground 1 of the notices of contention did not have to be considered. That is because the appeals failed on each of the grounds of appeal. However, the submissions in support of and against ground 1 of the notices of contention canvassed the proper construction of cl 26.2(a) of the leases which was also relevant to ground 2 of the grounds of appeal. The reasons of the Court deal with the construction of the relevant clause by considering the competing arguments raised by the notices of contention and the notices of appeal. Understood in that way, it can be seen that ground 1 of the notices of contention was not dealt with as a discrete issue. 5 It follows that this is not a proper case for apportioning costs because of success or failure on a discrete issue. As explained, the issue in question was not discrete, nor "clearly dominant or separable": Chou v Metstech Pty Ltd [2023] FCAFC 205 at [110]. The determination of costs on an issue-by-issue basis is ordinarily not desirable: Commissioner of Taxation v Bosanac (No 2) [2022] FCAFC 5 at [16]. There is nothing in the present case to make it out of the ordinary. 6 In the result, in each appeal the appellant should pay the second respondent's costs, as taxed or agreed, and the first respondent should bear its own costs. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Markovic, Stewart and Anderson. Associate: Dated: 11 April 2024