FEDERAL COURT OF AUSTRALIA Mintel International Group v Mintel (Australia) Pty Ltd (No 2) [2000] FCA 1905 COSTS – indemnity costs sought Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 applied J-Corp Pty Ltd v ABLFUW (No 2) 1993 46 IR 301 at 303 mentioned Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 mentioned Yunghanns v Elfic Ltd Victorian Supreme Court, unreported, 3 July 1998 mentioned MINTEL INTERNATIONAL GROUP LIMITED v MINTEL (AUSTRALIA) PTY LTD AND ANOR (NO 2) NO V 185 OF 2000 HEEREY J 22 DECEMBER 2000 MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V 185 OF 2000 BETWEEN: MINTEL INTERNATIONAL GROUP LIMITED APPLICANT AND: MINTEL (AUSTRALIA) PTY LTD FIRST RESPONDENT BRENT HUGHES SECOND RESPONDENT JUDGE: HEEREY J DATE OF ORDER: 22 DECEMBER 2000 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: The respondents pay the applicant's costs of the motion dated 26 September 2000, including reserved costs, such costs to be taxed on a party and party basis. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY V 185 OF 2000 BETWEEN: MINTEL INTERNATIONAL GROUP LIMITED APPLICANT AND: MINTEL (AUSTRALIA) PTY LTD FIRST RESPONDENT BRENT HUGHES SECOND RESPONDENT JUDGE: HEEREY J DATE: 22 DECEMBER 2000 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 On 26 September 2000 I dismissed a motion by the respondents seeking orders setting aside an earlier consent order disposing of this proceeding and releasing them from undertakings given to the Court. 2 When I gave judgment on the respondents' motion senior counsel for the applicant asked that costs be awarded on an indemnity basis. With the agreement of the parties I adjourned this question and directed that written submissions be filed and served. This has now been done. 3 The background to this matter and my reasons for dismissing the respondents' motion are contained in the judgment: [2000] FCA 1410. 4 In the applicant's submissions reference is made to the well known authorities and in particular Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225. The applicant submitted that the respondents' case amounted to little more than a string of false and often irrelevant allegations against Mr Collinson, junior counsel retained for the applicant at the trial. Broadly speaking those allegations, which I rejected, were that in the course of the Westpac litigation five years earlier Dr Hughes disclosed confidential information about his business and his personal characteristics to Mr Collinson and that in January and February 2000 Dr Hughes imparted confidential information to Mr Collinson in relation to the present proceeding. 5 It was said on behalf of the applicant that, properly advised, the respondents should have known that they had no chance of success: see J-Corp Pty Ltd v ABLFUW (No 2) 1993 46 IR 301 at 303, Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397. 6 Reliance was also placed on a letter from the applicant's solicitors dated 28 September 2000, the day the hearing of the respondents' motion commenced. This letter confirmed the applicant's solicitors' request that the respondents' solicitors take "further careful instructions" from Dr Hughes in relation to the content of his affidavit sworn 25 September 2000. The writer stated: "I further confirm that I request that you do so because of legal costs consequences." The letter went on to refer to the Court's discretion to award indemnity costs in circumstances including evidence of particular misconduct that causes loss of time to the Court and other parties, the fact that proceedings were commenced for some ulterior motive, the fact that proceedings were commenced in wilful disregard of known fact and clearly established law and the making of allegations that ought never to have been made or the undue prolongation of the case by groundless contentions. 7 In my opinion, this is not an appropriate occasion for the award of indemnity costs. It is true that, notwithstanding the careful and thorough argument of senior counsel for the respondents, by the time their case concluded I had formed a clear view that the motion should be dismissed. Counsel for the applicant were not called on. Nevertheless, the fact that one side wins convincingly is not in itself usually regarded as a ground for the award of indemnity costs. Nor is the circumstance that the Court has found in favour of the successful party on factual issues. This is particularly so when the issues concern conversations. It is notorious that people can give, quite honestly, different versions of a conversation. A judge has to determine which version is the more likely to be accurate. Preference for one does not necessarily mean that the version not accepted by the judge is the product of perjury or contrivance. 8 As far as the law goes, such authority as there was tended at first blush to favour the respondents. True it is that after analysis, and particularly consideration of the decision of Gillard J in Yunghanns v Elfic Ltd, Victorian Supreme Court, unreported, 3 July 1998, those authorities could be distinguished. However there was no authority dealing with the position of a barrister, as distinct from a solicitor, acting against a former client. Thus the legal issues were not directly governed by binding authority. 9 So, in summary, the respondents had factual findings made against them and, on analysis, even if the facts had been as they asserted, the law would not assist them. Accordingly they lost. But there does not seem to be any special feature of the kind discussed in the authorities which would take the case out of the ordinary rule that the loser pays costs on a party and party basis. 10 As to the applicant's solicitors' letter, it is expressed in somewhat oblique terms. But in any event, if the circumstances would not otherwise justify an order for indemnity costs, I do not think a warning letter of this kind can achieve that result. If that were so, it would become a routine matter for solicitors on both sides of litigation to warn of applications for indemnity costs and the award of such costs would become the rule rather than the exception. 11 Accordingly, there will be an order that the respondents pay the applicant's costs of the motion dated 26 September 2000, including reserved costs, such costs to be taxed on a party and party basis. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey J. Associate: Dated: 22 December 2000 Counsel for the Applicant: J McL Emmerson QC and B Caine Solicitor for the Applicant: Minter Ellison Counsel for the Respondents: F X Costigan QC and M Pirrie Solicitor for the Respondents: Freehills Date of Hearing: 22 December 2000 Date of Judgment: 22 December 2000