FEDERAL COURT OF AUSTRALIA NAES v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 1221 COSTS – application seeking waiver of security to be lodged in support of objection to bill of costs – respondent filed bill of costs after applicant discontinued proceedings – applicant seeks to challenge estimate of taxation made by Registrar – claim by applicant that he did not receive copy of bill of costs from respondent – objections to bill of costs not specified – whether court should waive requirement to pay security Federal Court Rules O 62 r 46 Fuller v Minister for Primary Industries and Energy and Anor (unreported, Federal Court of Australia, French J, 15 April 1998) referred to Dudzinski v Kellow [2000]FCA 740 followed NAES v MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS N 228 OF 2002 TAMBERLIN J SYDNEY 2 OCTOBER 2002 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 228 OF 2002 BETWEEN: NAES APPLICANT AND: MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS RESPONDENT JUDGE: TAMBERLIN J DATE OF ORDER: 2 OCTOBER 2002 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The applicant is to serve any draft Notice of Objection to the bill of costs he may wish to make and any evidence on which he relies in relation to waiver of security within fourteen days. 2. The respondent is to file and serve any evidence on which he proposes to rely by 23 October 2002. 3. The matter is stood over for hearing on 25 October 2002 at 9.30 am. 4. Costs are reserved. 5. Liberty to apply on one day's notice. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 228 OF 2002 BETWEEN: NAES APPLICANT AND: MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS RESPONDENT JUDGE: TAMBERLIN J DATE: 2 OCTOBER 2002 PLACE: SYDNEY REASONS FOR JUDGMENT 1 Before me is a Notice of Motion filed by the applicant on 25 September 2002, seeking a waiver of an amount of $750, which is required as security for costs of the taxation of a bill of costs, which has been filed by the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"). 2 The history of the matter is as follows. The applicant filed an application in this Court for review of a decision of the Refugee Review Tribunal ("the RRT") made on 28 February 2002. The application in the Federal Court was filed on 22 March 2002, and was listed for hearing on 26 July 2002. On 19 July 2002 the solicitor for the Minister received a facsimile from counsel for the applicant attaching a Notice of Discontinuance of proceedings signed by the applicant. The Court Registry did not accept the Notice because it had not been consented to by the Minister. 3 On 22 July 2002, the solicitor for the Minister wrote to counsel for the applicant attaching a draft Notice of Discontinuance. This letter, which was sent by facsimile, noted that costs would have to be paid by the applicant and that the Minister would proceed to obtain a bill of costs and file a Certificate of Taxation with the Court. The Notice of Discontinuance was dated 23 July 2002 and was sent to the Court on that date. It is stamped as having been received on that date. 4 On 14 August 2002, the solicitor for the Minister filed a bill of costs in the Federal Court and it was set down to be assessed on 17 September 2002. On the same date a letter from the Minister's solicitor was sent to the applicant at his address for service enclosing by way of service the bill of costs filed in the Federal Court on 14 August. On 17 September 2002, a letter was also sent to the applicant from a Registrar of the Court, in which the Registrar estimated that if the bill of costs were to be taxed the approximate total of the Certificate of Taxation would be $2,459.40. The bill filed by the Minister was for a total sum of $2,659.40. The Minister has not and does not intend to object to the Registrar's estimate but rather intends to rely on it. 5 Order 22 r 3(1) of the Federal Court Rules ("the Rules") provides that a person who discontinues a proceeding shall pay the costs of the other party. 6 In the letter of 17 September from the Court, the attention of the applicant was drawn to O 62 sub-rule 46(3) of the Rules which provides as follows: "46(3)(a) A taxing officer may, in the absence of parties and without making any determination on the individual items in the bill, make an estimate of the approximate total for which, if the bill were to be taxed, the certificate of taxation would be likely to issue. (b) The Registrar will notify each party interested in the bill in writing of an estimate made under paragraph (a). (c) Unless within 14 days of receipt of notice under paragraph (b), a party interested files and serves on each other party a notice of objection to the estimate, there shall be no taxation, and the amount of the estimate shall be deemed to be the amount for which a certificate of taxation may issue. (d) Upon filing a notice of objection a party shall pay to the Registrar an amount of $750 as security for the costs of any taxation of the bill. …" (Emphasis added) 7 The requirements of O 62 r 46 in relation to the assessment of costs is designed to avoid the expensive and cumbersome procedure of taxing costs. As French J said in Fuller v Minister for Primary Industries and Energy and Anor (unreported, Federal Court of Australia, French J, 15 April 1998): "The purpose of the rules under which the Registrar may make an estimate of the approximate total of the costs to be taxed is to provide a mechanism for the efficient and inexpensive disposition of cost assessments. A party objecting to the estimate does so at his own risk as to the costs of the process of taxation which he invokes. In this case Mr Fuller sent a fax to the Registrar which, on a broad view, could have been taken to be a notice of objection to the estimate. Subject to the payment of the security for costs required under O 62 r 46(3)(d) it might have been treated as such." 8 It was pointed out in the letter from the Court that if a Notice of Objection was not filed under that sub-rule then the party who filed the bill of costs should prepare and lodge a draft Certificate of Taxation. In this case the party filing the bill of costs was the Minister. 9 On 25 September 2002 the solicitor for the Minister received a call from counsel for the applicant in which counsel said that his client had not received the itemised bill of costs and therefore had not been able to decide whether to have the draft bill taxed although his client had received the estimate. 10 The applicant filed an affidavit on 25 September 2002, in which he says that the matter is "currently on appeal to the Minister" and as a result he does not have any permission to work and does not have any funds to pay the security required. I have taken this to mean that an application to the Minister has been made under s 417 of the Migration Act 1958 (Cth) ("the Act"). He also says that he was not given a bill of costs in accordance with the Rules which would enable him to raise any objections. He also says that there had been an attempt to deny him the opportunity to file the bill for taxation. He asserts that his case was withdrawn before any costs were incurred and that the figure submitted by the solicitor overcharged for photocopying of documents. He says he would prefer the Court to tax the bill and he further asserts that he has done the right thing by withdrawing or discontinuing the case without trial. He says that he should not be made to pay extra because there was no contest at the end and that no costs were incurred and that it would be unjust for him to be treated differentially. Finally, he says that he did not anticipate paying any of the bill since no such costs were actually incurred. The affidavit does not point to any particular item or aspect of the costs to which an objection is made apart from the broad allegation in relation to photocopying and no attempt is made to demonstrate that any costs relating to photocopying or otherwise were not warranted or allowable. 11 The affidavit of Ms Rayment for the Minister sworn on 26 September 2002 attaches a copy of the letter of 14 August 2002 to the applicant enclosing by way of service the itemised bill of costs filed in the Federal Court on 14 August 2002 by the Minister. It was sent by ordinary mail and was addressed to the applicant at the address for service and there is no disagreement that this is the correct address. However, the applicant has asserted on oath that he was not given a bill of costs and he was not cross-examined nor was any contrary evidence given on behalf of the applicant. 12 By O 62 r 46 of the Rules a taxing officer may make an estimate of the approximate total for which the Certificate of Taxation would be likely to issue. The parties must be notified of such an estimate. In this case it is not disputed that the estimate was received by the parties on or about 17 September 2002. The parties then have fourteen days after receipt of the notice to file and serve on the other party a Notice of Objection to the estimate. If this is not done there will be no taxation and the amount of the estimate is deemed to be the amount for which the Certificate of Taxation can issue. If a party wishes to object to the bill of costs then a Notice of Objection must be filed and any objecting party must pay to the Registrar an amount of $750 as security for the costs of any taxation of the bill. 13 It has been pointed out for the Minister that in Dudzinski v Kellow [2000]FCA 740 at [25]-[26], Spender J observed that the purpose of the requirement for security is the protection of the party whose bill of costs is challenged. It is not in the nature of a filing fee. In that case, his Honour expressed the view, with which I agree, that it is a security which ordinarily has to be put forward as the price to exercise the right to challenge. The question is not simply whether a person should, as a matter either of fairness or justice, be able to challenge a bill of costs without any financial consequences, even if the challenge to a bill of costs is unsuccessful or substantially unsuccessful. 14 There is, of course, power for the Court, pursuant to s 35A(1)(g) of the Federal Court of Australia Act 1976 (Cth) and O 1 r 8 of the Rules, to dispense with the obligation to pay $750 as security for the costs of any taxation. The Registrar has not exercised that power. Nor has any basis been shown for the Court to exercise that power in the circumstances of the present case on the material presently before me. 15 The substance of the argument advanced for the applicant on this Motion is based on the premise that he did not receive the itemised bill of costs until within the last two working days before the hearing of this application before me. I accept that is so. The submission, however, is that if the applicant had received the bill of costs at an earlier date he would not have had to pay the security as a condition of filing the Notice of Objection. This is premised on the basis that the Minister would have challenged the estimate because it was for less than the amount in the itemised bill of costs. If that had occurred then the Minister would have had to pay the security amount as he was the objector and not the applicant. The applicant could then have presented a case for the disallowance of the amounts in the bill of costs and the estimate. However, there is no suggestion that the applicant is prepared to accept the estimate and indeed the basis of his case is that he would not accept the estimate and that he would never be able to pay it. As recorded above he also states that no such costs as had been claimed were actually incurred. In any event, it was indicated that he had no resources from which to pay the costs. 16 The difficulty with the applicant's case is that there is no evidence to support the basic premise upon which he proceeds. There is no evidence that the Minister would have challenged the estimate issued by the Court. The evidence is to the contrary. There is no challenge to any specific item. Indeed, there is no evidence on which to base any specific objection to any item in the bill of costs. Moreover, if the applicant had sought to reduce the estimate below the amount of $2,459.40 then he would be regarded as a party objecting to the estimate and therefore, independently of whether the Minister was obliged to pay the security, he would have been obliged to pay an amount by way of security as an objector. The applicant's case is of course that he should not have to pay any costs because none of the costs were incurred. However, that is contrary to the evidence on his part and there is no counter evidence to rebut that position. 17 Plainly, the applicant misunderstands the assessment process because he suggests that he has been denied an opportunity to file the bill of costs without paying any security. The procedure followed in this case is that the Minister has filed a bill of costs with the Court. The Registrar has made an estimate which reduces the amount. If the applicant wishes to challenge that estimate then the rule requires that security must be provided by the applicant. If he does not wish to object to the estimate then he is bound to accept the estimate and the estimated amount will be determined to be the taxed costs: r 46(3)(c). There is, of course, a discretion for the Court to waive the requirement but no basis has been shown on the material presently before me to warrant any waiver. 18 In my view, the submissions of the applicant are based on speculation and no case has been made out for waiver of the security in the present case. This does not mean of course that the applicant is precluded from objecting to the bill of costs. Counsel for the applicant was unable to direct me to any specific rule which would support his submissions. 19 Notwithstanding the above, the applicant has not had an opportunity within fourteen days after receipt of the bill of costs to consider the estimate informed by the reference to the itemised bill of costs. He should be given an opportunity to consider the Court estimate in the light of the itemised bill. I therefore direct him to serve any draft notice of objection he wishes to make to the Court estimate within fourteen days from today. He should also file and serve any evidence on which he relies in relation to any waiver application he may make within fourteen days. The Minister is to file and serve any evidence on or before 23 October 2002. 20 I stand the matter over to Friday 25 October 2002 at 9.30 am for hearing and determination of any waiver application. The Minister can file any evidence on which he proposes to rely by Wednesday 23 October 2002. I reserve any costs to date. I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin. Associate: Dated: 2 October 2002 Counsel for the Applicant: J N Asuzu Solicitor-Advocate for the Respondent: B Rayment Solicitor for the Respondent: Sparke Helmore Date of Hearing: 1 October 2002 Date of Judgment: 2 October 2002