FEDERAL COURT OF AUSTRALIA Hardingham v RP Data Pty Limited (No 2) [2019] FCA 2138 File number: NSD 1266 of 2018 Judge: THAWLEY J Date of judgment: 17 December 2019 Legislation: Federal Court Rules 2011 (Cth) rr 40.02(b), 40.02(c) Cases cited: Gladstone Park Shopping Centre Pty Ltd v Wills (1984) 6 FCR 496 Hardingham v RP Data Pty Limited [2019] FCA 2075 Date of hearing: 17 December 2019 Registry: New South Wales Division: General Division National Practice Area: Intellectual Property Sub-area: Copyright and Industrial Designs Category: No Catchwords Number of paragraphs: 8 Counsel for the Applicants: Mr R Cobden SC and Mr J Sleight Solicitor for the Applicants: Neville Hourn and Bourg Legal Counsel for the Respondent/Cross-Claimant: Mr MD Martin QC and Mr AF Messina Solicitor for the Respondent/Cross-Claimant: Mills Oakley Lawyers Counsel for the Cross-Respondent: Mr HPT Bevan Solicitor for the Cross-Respondent: Corrs Chambers Westgarth ORDERS NSD 1266 of 2018 BETWEEN: JAMES KELLEND HARDINGHAM First Applicant REAL ESTATE MARKETING AUSTRALIA PTY LTD Second Applicant AND: RP DATA PTY LIMITED Respondent AND BETWEEN: RP DATA PTY LIMITED Cross-Claimant AND: REALESTATE.COM.AU PTY LTD Cross-Respondent JUDGE: THAWLEY J DATE OF ORDER: 17 DECEMBER 2019 THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicants pay the respondent's costs of the proceeding, excluding the costs of the cross-claim: (a) on a party and party basis up to 11.00am on 28 June 2019; and (b) thereafter on an indemnity basis; in a lump sum to be determined by a Registrar, pursuant to r 40.02(b) and (c) of the Federal Court Rules 2011 (Cth). 3. The cross-claim be dismissed. 4. The applicants pay the cross-respondent's costs of the cross-claim except the costs of and incidental to the hearing of the separate question. 5. If the parties cannot agree by 28 February 2020 on the amount of the lump sum, then that costs dispute be referred to a Registrar of this Court to fix the amount of the referred costs dispute(s). 6. On or before 13 March 2020, the party entitled to costs in any referred costs dispute(s) file and serve any costs summary and submissions in accordance with the Costs Practice Note (GPN-COSTS). 7. On or before14 April 2020, the party paying costs in any referred costs dispute(s) file and serve any costs response and submissions in accordance with the Costs Practice Note (GPN-COSTS). 8. Pursuant to r 1.37 of the Rules, the Registrar: (a) determine the quantum of costs in any referred costs dispute(s) in such manner as he or she thinks fit, including, if thought appropriate, on the papers; (b) within 28 days of the making of the determination, make orders for the payment of the amounts so determined. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (Revised from transcript) THAWLEY J: 1 On 9 December 2019 I delivered reasons for concluding that the applicants had not discharged the onus of establishing that the respondent (RP Data) had infringed copyright in relation to the works the subject of a separate question: Hardingham v RP Data Pty Limited [2019] FCA 2075. The proceedings were stood over to today for the making of orders to give effect to the reasons for judgment and for any argument in relation to costs. 2 The applicants and RP Data are agreed that the application should be dismissed. RP Data and the cross-respondent to the cross-claim, realestate.com.au Pty Ltd (REA), are agreed that RP Data's cross-claim should be dismissed. 3 Leaving aside for the moment the costs of RP Data's cross-claim against REA, the applicants and RP Data are agreed that the applicants should pay RP Data's costs of the proceedings on the party and party basis up to 11.00am on 28 June 2019 and thereafter on an indemnity basis. This agreement arises against the background of REA having filed a Notice of offer to compromise dated 26 June 2019, being an offer made on behalf of both REA and RP Data. It also arises against the background of an offer of settlement made by way of letter dated 26 June 2019, that offer being made on a Calderbank basis. It is not necessary to set out the details of the offer although it is relevant to note that REA made an offer to pay a sum of money to the applicants in settlement of the applicant's claim against RP Data. 4 The parties are also agreed that, failing the parties reaching agreement as to the amount of costs, those costs should be determined in a lump sum by a Registrar of this Court pursuant to rules 40.02(b) and (c) of the Federal Court Rules 2011 (Cth). 5 The primary dispute concerns the costs of RP Data's cross-claim. 6 I take into account the following matters in relation to those costs: (1) First, RP Data's decision to issue the cross-claim was reasonable and it would not have had to issue a cross-claim if the applicants had not commenced the proceedings against it. However, that does not of itself necessarily have the consequence that the applicants should pay REA's and RP Data's costs of the cross-claim. (2) Secondly, the applicants did not make any claim against REA and would not have obtained any benefit if RP Data had been successful in its cross-claim. The cross-claim only advanced RP Data's interests by seeking to secure indemnity in the event the applicants were successful – cf: Gladstone Park Shopping Centre Pty Ltd v Wills (1984) 6 FCR 496 at 510 (Beaumont J with whom Northrop and Davies JJ agreed). Although RP Data submitted that the cross-claim "did not raise issues private as between the respondent and cross-respondent", the cross-claim revolved around their contractual relationship, in particular whether REA had granted RP Data an indemnity, and in that sense did reflect an issue private to RP Data and REA. (3) Thirdly, the separate question only concerned the liability of RP Data to the applicants. The written submissions of RP Data and REA, which had been filed before the hearing of the separate question, addressed the question of REA's liability under the cross-claim. However, at the commencement of the hearing of the separate question RP Data and REA agreed that liability under the cross-claim was not an issue which arose for determination. That position reflected the fact that the order for a separate question pre-dated RP Data's cross-claim. REA chose to appear on the separate question to be heard in relation to RP Data's liability to the applicants. That was permissible and appropriate and the Court granted leave for REA to appear. However, it was not necessary for the determination of the separate question. RP Data was represented by senior and junior counsel. The applicants should not bear the costs of double representation against them on the single separate question of RP Data's liability. The interests of RP Data and REA were relevantly aligned on the separate question. It is true, as RP Data submitted, that REA was the conduit through which RP Data obtained the works the subject of the separate question. However, contrary to RP Data's submission, that does not mean that the real dispute was between the applicants and both RP Data and REA. The applicants chose not to take proceedings against REA. It was RP Data's choice to join REA to promote its interests in the event the applicants were successful. (4) Fourthly, as mentioned above, RP Data sought leave to bring its cross-claim only after the order had been made for determination of the separate question. The majority of REA's costs relate to the hearing of that issue, namely RP Data's liability to the applicants. That issue could and would have been determined as between the applicants and RP Data without the involvement of REA, had RP Data not chosen to issue the cross-claim or if REA had not sought to be heard on the separate question. (5) Fifthly, there has been and will be no determination of the cross-claim on the merits. It is relevant to note, however, that REA defended the cross-claim on the basis that there was no breach of copyright but the existence of the indemnity between REA and RP Data was effectively undisputed. (6) Sixthly, it is perhaps relevant also to note that REA participated in making an offer to the applicants, together with RP Data, pursuant to which REA was to pay an amount of money to the applicants. REA also participated in a mediation. 7 Taking all these matters into account, the appropriate order is for the applicants to pay the cross-respondent's costs of the cross-claim except the cross-respondent's costs of and incidental to the hearing of the separate question. REA should bear its costs in that regard. There otherwise should be no order as to the costs of the cross-claim. 8 The second issue on which the parties were not agreed was whether there should be a stay of the orders in relation to costs if an appeal is filed. I would hope the parties would be able to agree a position in that respect if an appeal is filed. It is premature to decide the question of whether it is appropriate to grant a stay in circumstances where no grounds of appeal have yet been identified and where nothing is known about the applicant's financial capacity to meet costs orders. There may be other considerations which should be taken into account before making a decision about any stay. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Thawley. Associate: Dated: 17 December 2019