Federal Court of Australia Scarati v Republic of Italy (No 2) [2023] FCA 1269 File number: VID 536 of 2020 Judgment of: THOMAS J Date of judgment: 20 October 2023 Catchwords: PRACTICE AND PROCEDURE – costs – application for costs under s 570(2) of the Fair Work Act 2009 (Cth) – where respondent's solicitors attended mediation without authorisation or instructions to settle – discovery of documents – where parties reached an agreed position during the hearing – indemnity orders sought Legislation: Fair Work Act 2009 (Cth) Fair Work Regulations 2009 (Cth) Federal Court of Australia Act 1976 (Cth) Cases cited: Australian Competition and Consumer Commission v Colgate-Palmolive Pty Ltd (No 5) (2021) 151 ACSR 26; [2021] FCA 246 Australian Workers' Union v Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428; [2013] FCAFC 23 Chinatown Enterprises Pty Ltd v Maxims Entertainment Pty Ltd. (Supreme Court of New South Wales, unreported, Levine J, 13 December 1996) Colgate-Palmolive Company v Cussons Pty. Limited (1993) 46 FCR 225 Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 Pal v Commonwealth of Australia (No 2) [2021] FCA 37 Ryan v Primesafe (2015) 323 ALR 107; [2015] FCA 8 Saxena v PPF Asset Management Ltd [2011] FCA 395 Specsavers Pty Ltd v The Optical Superstore Pty Ltd (2012) 208 FCR 78; [2012] FCAFC 183 Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (unreported, French J, 3 May 1991) Division: Fair Work Division Registry: Victoria National Practice Area: Employment and Industrial Relations Number of paragraphs: 71 Date of hearing: 6 April 2022, 1 August 2022, 27 October 2022 and 23 November 2022 Counsel for the Applicant: Mr N Harrington Solicitor for the Applicant: Russell Kennedy Lawyers Counsel for the Respondent: Mr J Tierney Solicitor for the Respondent: Vincent Volpe ORDERS VID 536 of 2020 BETWEEN: ANTONIO SCARATI Applicant AND: REPUBLIC OF ITALY (MINISTER OF FOREIGN AFFAIRS AND INTERNATIONAL CORPORATION - MELBOURNE CONSULATE) Respondent order made by: THOMAS J DATE OF ORDER: 20 October 2023 THE COURT ORDERS THAT: 1. The costs incurred by the applicant with respect to the mediation which took place on 13 August 2021 and the application relating to costs of 19 August 2021 be payable by the respondent on an indemnity basis to be agreed or taxed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT THOMAS J: INTRODUCTION 1 These reasons relate to costs applications made in relation to an abandoned mediation on 13 August 2021 and the provision of discovery. THE PRINCIPLES – COSTS – FW ACT SECTION 570 – INDEMNITY COSTS 2 Section 43 of the Federal Court of Australia Act 1976 (Cth) (the Federal Court Act) allows the Court a broad jurisdiction in awarding costs in all proceedings before the Court "other than proceedings in respect of which this or any other Act provides that costs must not be awarded". The power is said to be subject to s 570 of the Fair Work Act 2009 (Cth) (the FW Act). 3 A party to proceedings in relation to a matter arising under the FW Act may be ordered by the Court to pay costs incurred by the other party only in accordance with the requirements of s 570(2). 4 Section 570(2) provides that a party may be ordered to pay costs only if: (a) … (b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs; or (c) … 5 The discretion conferred by s 570(2) must be exercised cautiously and the case for its exercise must be clear (Saxena v PPF Asset Management Ltd [2011] FCA 395 at [6] per Bromberg J). The policy behind s 570 of the FW Act is to free parties from the risk of having to pay the opponents' costs so that those with a genuine grievance and an arguable basis for the grievance are not put off from commencing or continuing proceedings, while at the same time protecting parties from incurring costs as a result of the other party's unreasonable acts or omissions or as a result of proceedings which have been instituted vexatiously or without cause (Australian Workers' Union v Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428; [2013] FCAFC 23 at [7] per Dowsett, McKerracher and Katzmann JJ). 6 Essentially, s 570 seeks to balance the access to justice aspect (costs can be ordered only in limited circumstances outlined in s 570(2)) against the expectation that the parties and their legal representatives will act in a responsible way (costs can be awarded if the party instituted the proceedings vexatiously or without reasonable cause, or the party's unreasonable act or omission caused the other party to incur the costs or the party unreasonably refused to participate in a matter before the Fair Work Commission) (Ryan v Primesafe (2015) 323 ALR 107; [2015] FCA 8 (Ryan) at [65]-[67] per Mortimer J (as her Honour then was)). 7 Once an exception under s 570 is enlivened, it is within the Court's general discretion to decide if any award for costs is made and, if so, upon what terms (Pal v Commonwealth of Australia (No 2) [2021] FCA 37 at [22] per Anderson J). 8 The most common order made in relation to costs is that costs be paid on a party and party basis. Principles relevant to an award of costs other than on a party and party basis, including an order that costs be paid on an indemnity basis, were summarised by Wigney J in Australian Competition and Consumer Commission v Colgate-Palmolive Pty Ltd (No 5) (2021) 151 ACSR 26; [2021] FCA 246 at [6]-[12] (portions relevant to the current case extracted) as follows: [6] The Court's discretionary power to award costs derives from s 43 of the Federal Court of Australia Act 1976 (Cth) (FCA Act). The usual rule is that an order for costs means costs "as between party and party": r 40.01 of the Rules … A party or person who is entitled to costs may, however, apply for an order that costs be awarded in their favour "other than as between party and party": r 40.02(a) of the Rules. That includes an order that costs be awarded on an indemnity basis. [7] The discretion to award costs on a basis other than as between party and party, including on an indemnity basis, is "unfettered, save that it must be exercised judicially and not arbitrarily or capriciously": Australian Competition and Consumer Commission v The Construction, Forestry, Mining and Energy Union (No 4) [2018] FCA 684 at [96]. The discretion must also be exercised in light of the requirement that the Court consider any failure by a party to comply with the overarching purpose of the civil practice and procedure provisions to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible: see ss 37N(4), 37M(1) of the FCA Act; LFDB v SM (No 2) [2017] FCAFC 207 at [7]. [8] The discretion to depart from an order for party and party costs will not be exercised unless there is some special or unusual feature or the justice of the case so requires … [9] The purpose of a costs order is to compensate the successful party, not to punish the unsuccessful one … An award of indemnity costs is to "serve the purpose of compensating a party fully for costs incurred, as a normal costs order could not be expected to do, when the court takes the view that it was unreasonable for the party against whom the order is made to have subjected the innocent party to the expenditure of costs": Hamod v New South Wales (2002) 188 ALR 659; [2002] FCAFC 97 … [10] The circumstances in which it may be found to be unreasonable for the successful party to be subjected to the expenditure of any costs are not fixed or closed … 9 I agree with the observation made by Mortimer J in Ryan at [114] (in the context of an application under s 570(2)(b)) when her Honour observed that, in the authorities such as Colgate-Palmolive Company v Cussons Pty. Limited (1993) 46 FCR 225 (Colgate-Palmolive), a factor which appears to influence the decision "is a level of blameworthiness which involves conscious or deliberate choices to flout the norms by which litigation is usually conducted, and courts expect it to be conducted". It must be at a higher level of disregard than, for example, a delay in taking steps in litigation. Sheppard J in Colgate-Palmolive referred to the decision of Woodward J in Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 400-401 where his Honour referred to "some special or unusual feature in the case to justify the court exercising its discretion in that way" and observed that, in all the cases he had considered, "there has been some further factor which has influenced the exercise of the court's discretion". Examples include a comparison between where charges of fraud have been made and not sustained as compared with "allegations of fraud hav[ing] been made knowing them to be false, or they have been irrelevant to the issues between the parties". Reference was made to a position "where the applicant, properly advised, should have known that he had no chance of success" or where proceedings were commenced with some ulterior motive or, "because of some wilful disregard of the known facts or the clearly established law". 10 This approach is consistent with the regime imposed with respect to matters to which s 570(2)(b) refers. In that case, to make any order as to costs, it is necessary that the Court be satisfied of a party's unreasonable act or omission. In such a matter, the starting point after a finding of an unreasonable act or omission would be that the costs be paid on a party and party basis. It follows that conduct must be at a more serious level to bring an order for costs to be paid on an indemnity basis into play. The approach is illustrated in Ryan. In that case, Mortimer J found there was insufficient evidence of wilful disregard of the facts and law in pleading allegations. Whilst there had been some loss of court time, bearing in mind the magnitude of the loss, it was not such as to justify a departure from the usual form of costs orders. In Ryan, Mortimer J concluded that, without more, this did not justify "what would be, in substance, a second departure from the underlying policy and evidenced in s 570 by a costs order at the level of indemnity costs". 11 Evidence of particular misconduct that causes loss of time to the Court or other parties has been thought to warrant the exercise of the discretion to order indemnity costs (Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (unreported, French J, 3 May 1991) and Colgate-Palmolive at 5). 12 In terms of the consideration of the failure by a party to comply with the overarching purpose of the civil practice and procedure provisions, the following provisions of the Federal Court Act are relevant: 37M The overarching purpose of civil practice and procedure provisions (1) The overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes: (a) according to law; and (b) as quickly, inexpensively and efficiently as possible. (2) Without limiting the generality of subsection (1), the overarching purpose includes the following objectives: (a) the just determination of all proceedings before the Court; (b) the efficient use of the judicial and administrative resources available for the purposes of the Court; (c) the efficient disposal of the Court's overall caseload; (d) the disposal of all proceedings in a timely manner; (e) the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute. (3) The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose. (4) The civil practice and procedure provisions are the following, so far as they apply in relation to civil proceedings: (a) the Rules of Court made under this Act; (b) any other provision made by or under this Act or any other Act with respect to the practice and procedure of the Court. 37N Parties to act consistently with the overarching purpose (1) The parties to a civil proceeding before the Court must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose. (2) A party's lawyer must, in the conduct of a civil proceeding before the Court (including negotiations for settlement) on the party's behalf: (a) take account of the duty imposed on the party by subsection (1); and (b) assist the party to comply with the duty. (3) The Court or a Judge may, for the purpose of enabling a party to comply with the duty imposed by subsection (1), require the party's lawyer to give the party an estimate of: (a) the likely duration of the proceeding or part of the proceeding; and (b) the likely amount of costs that the party will have to pay in connection with the proceeding or part of the proceeding, including: (i) the costs that the lawyer will charge to the party; and (ii) any other costs that the party will have to pay in the event that the party is unsuccessful in the proceeding or part of the proceeding. (4) In exercising the discretion to award costs in a civil proceeding, the Court or a Judge must take account of any failure to comply with the duty imposed by subsection (1) or (2). (5) If the Court or a Judge orders a lawyer to bear costs personally because of a failure to comply with the duty imposed by subsection (2), the lawyer must not recover the costs from his or her client. 13 The Court should take into account any failure to comply with the duties in s 37M in exercising its costs discretion (Specsavers Pty Ltd v The Optical Superstore Pty Ltd (2012) 208 FCR 78; [2012] FCAFC 183 at [57]-[58] per Foster, Barker and Griffiths JJ). 14 The Central Practice Note: National Court Framework and Case Management (CPN) "sets out the fundamental principles concerning the National Court Framework ("NCF") of the Federal Court, together with key principles of case management procedure" (emphasis in original) (see cl 1.1). 15 The CPN describes the overarching purpose of civil practice and procedure and case management within the individual docket system to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible, and refers to ss 37M and 37N of the Federal Court Act (see cl 7.1). The parties and their lawyers are expected, and have a statutory duty, to co-operate with the Court and among themselves to assist in achieving the overarching purpose (see cl 7.2). The CPN refers to considering the use of, and timing for, any alternative dispute resolution, including mediation, as a matter which should be considered by the parties in preparation (see cl 8.5). 16 Clause 9 deals specifically with Alternative Dispute Resolution (ADR). Clause 9 indicates that the ADR options should be viewed by the parties not only as a means of possible resolution of the whole dispute, but also as a means of limiting or resolving issues by agreement and of resolving interlocutory disputes (cl 9.1). 17 Clause 9.5 requires that, when attending mediation, "parties and their legal representatives must attend for the purpose of participating in good faith negotiations and must have the ability, in a practical way and with flexible instructions, to participate meaningfully in negotiations with a view to narrowing the issues in dispute and reaching a mutually acceptable resolution between them by way of compromise". THE FAILED MEDIATION ISSUE Background 18 On 12 May 2021, Collier J ordered, by consent, that the parties attend a mediation to be conducted after 5 July 2021. 19 The mediation was originally scheduled to take place on 29 July 2021, but was rescheduled to 13 August 2021. 20 By way of an email dated 9 August 2021, the solicitor for the Republic suggested postponing the mediation to enable issues relating to pleadings and further particulars to be resolved. 21 On 10 August 2021, the solicitor for the Republic forwarded an email to the Court (copied to Mr Scarati's solicitor) raising the possibility that, because of the outstanding pleadings issue, "it may become necessary to postpone the mediation". 22 The solicitor for Mr Scarati responded on 10 August 2021, indicating that Mr Scarati did not consent to the adjournment. On the same day, an email was forwarded to the Court to the same effect. 23 On 13 August 2021, the mediation was convened by videoconference. Mr Scarati, with counsel and his solicitor, attended a private session with the Court's Registrar, who was the mediator, after which the Registrar attended a similar private session with the Republic and its representatives. 24 The Registrar returned to Mr Scarati's private session and indicated that the Republic's representatives had advised that they had been unable to obtain authorisation or instructions to make any offers at the mediation and sought an adjournment for a few days. 25 In response, the Registrar was asked by Mr Scarati to convey to the Republic that: (a) there would be no adjournment of the mediation as it was clear that there was no utility in re-convening the mediation; (b) there had been no notification of this fact or matter (that is, of the Republic's representatives' inability to obtain authorisation or instructions in relation to making any offers at the mediation) prior to the Registrar having notified Mr Scarati and his representatives of the Republic's position upon returning to the private session; (c) Mr Scarati considered that the mediation ought to be terminated; and (d) Mr Scarati would be bringing an application before the Judge/Court to seek an indemnity costs order pursuant to s 570(2)(b) of the FW Act (in respect of the costs of and incidental to the mediation) and to seek directions to bring the matter on for trial as soon as possible. Mr Scarati had no interest in any further mediation. 26 No offer was made, at the mediation, in relation to payment of Mr Scarati's costs thrown away as a result of the abandoned mediation. The interlocutory application 27 By way of interlocutory application filed on 19 August 2021, Mr Scarati sought, amongst other things, that: 1. Pursuant to s.37P(6)(d) and (e) of the Federal Court of Australia Act 1976 (Cth) and s.570(2)(b) of the Fair Work Act 2009 (Cth), the [r]espondent pay to the [a]pplicant indemnity costs fixed in the sum of $10,306.00 arising out of, and incidental to, the court ordered mediation abandoned on 13 August 2021. 2. The indemnity costs fixed in order 1 above be paid by the [r]espondent to the [a]pplicant forthwith, namely within 7 days of the date of the order. 3. Pursuant to s.37P(5) of the Federal Court of Australia Act 1976 (Cth), the [r]espondent re-credit to the [a]pplicant one day of paid annual leave in his employment with the [r]espondent arising out of court-ordered mediation abandoned on 13 August 2021. … 14. Pursuant to s.37P(6)(d) and (e) of the Federal Court of Australia Act 1976 (Cth) and s.570(2)(b) of the Fair Work Act 2009 (Cth), the [r]espondent pay to the [a]pplicant the costs of, and incidental to, this [a]pplication on an indemnity basis: a) fixed in the sum of $9000 inclusive of costs and disbursements and appearances by counsel before the Court; plus b) filing fee for this application. 15. The costs fixed in order 14 above be paid by the [r]espondent to the [a]pplicant forthwith, namely within 7 days of the date of this order. … (errors in original) 28 Other orders were sought in relation to Further and Better Particulars, production of documents, filing of an amended defence, filing of affidavit material and outlines of submission as well as a hearing date. Those other matters were largely resolved by consent orders, although there was a short argument relating to the production of the documents (which was ultimately resolved by consent order). 29 As is made obvious from ss 37M and 37N, and the contents of the CPN, the overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. 30 This overarching purpose includes: (a) … (b) the efficient use of the judicial and administrative resources available for the purposes of the Court; (c) the efficient disposal of the Court's overall caseload; (d) the disposal of all proceedings in a timely manner; … 31 Early resolution of matters as a result of the availability of ADR, provided by the Court, is seen to be an essential aspect of the facilitation of the just resolution of disputes as quickly, inexpensively and as efficiently as possible. This facilitates the efficient use of judicial and administrative resources available for the purpose of the Court, assists with the disposal of proceedings in a timely manner, and facilitates the efficient disposal of the Court's overall caseload. 32 To facilitate this object, cl 9 of the CPN requires that, when attending mediation, parties and their legal representatives must attend for the purpose of participating in good faith negotiations and have the ability, in a practical way and with flexible instructions, to participate meaningfully in negotiations with a view to narrowing the issues in dispute and reaching a mutually acceptable resolution between them by way of compromise (cl 9.5). 33 In this case, the Republic consented to an order that the parties attend at mediation and agreed the date. On 10 August 2021, when the solicitor for the Republic suggested postponing the mediation because of other reasons, no mention was made of the fact that the representative was not, as is required by cl 9.5 of the CPN, able to participate in good faith negotiations with the ability, in a practical way and with flexible instructions, to participate meaningfully in negotiations with a view to narrowing the issues in dispute and reaching a mutually acceptable resolution between the parties by way of compromise. 34 In fact, until a time after the mediation had commenced, the Republic's solicitor had not warned either the Court or the other party of the lack of instructions. 35 The fact that the mediation was, in circumstances where it could not proceed, allowed to commence "and was then terminated" was at odds with the efficient use of judicial and administrative resources available for the purpose of the Court and with the efficient disposal of the Court's overall caseload. The cause of this issue is unexplained. 36 The Republic has agreed that the conduct was an unreasonable act or omission by the Republic which caused Mr Scarati to incur the costs. The Republic submitted that an order for payment of costs on a party/party basis would be justified. 37 That concession is, no doubt, a correct and appropriate concession. It is clear that the conduct by the Republic was unreasonable and equally clear that the unreasonable act or omission caused Mr Scarati to incur costs associated with the termination of the mediation and the need to make the application. 38 The Republic opposes the application for an order that these costs be assessed on an indemnity basis. 39 In the circumstances as described earlier, I believe that the conduct is at a level of blameworthiness which is contrary to the norms by which litigation is usually conducted, and the Court expects it to be conducted. In particular, I take account of the important of the overarching purpose of the lack of adherence to this purpose as well as the fact that no steps were taken to cancel the mediation before it was scheduled to commence. 40 On that basis, I conclude that the conduct warrants an order that the costs incurred with respect to the mediation and the application relating to costs of 19 August 2022 be payable on an indemnity basis rather than a party/party basis. THE DISCOVERY ISSUE 41 The parties were in dispute regarding aspects of discovery. 42 On 6 April 2022, an order was made by consent requiring the Republic to serve upon Mr Scarati a list of documents making discovery of various categories of documents listing in (a)-(h) in Order 2 of the 6 April 2022 order. 43 At that time, the question of costs was reserved. 44 In the course of complying with the Order, it became obvious that the majority of the documents were in Italian, not in English. Ultimately, Mr Scarati made an application filed on 27 June 2022 seeking orders that the Republic provide to Mr Scarati, translated into English and certified by the National Accreditation Authority for Translators and Interpreters (NAATI), copies of: a. all "employee records", as specified in Part 3-6, subdivision 1 of Division 3 of the Fair Work Regulations 2009 (Cth) (Regulations), in the form prescribed under section 535 (1) of the Fair Work Act 2009 (Cth) (Act) and Reg. 3.31 (1) of the Regulations; and b. documents ordered to be discovered by His Honour, Justice Thomas, on 6 April 2022[.] 45 The list was said to be "including" a number of categories of documents listed in (i) to (viii). Categories (i) to (v) referred to the requirements of the Fair Work Regulations 2009 (Cth) (FW Regulations). 46 The interim order also sought payment by the Republic to Mr Scarati of the costs of and incidental to the application on an indemnity basis, fixed in the sum of $5,000 inclusive of costs and disbursements and appearances by counsel before the Court, plus the filing fee on the application. 47 As it happened, the orders in relation to provision of translations were agreed between the parties at the hearing and so the orders were made by consent as to those issues. The arguments 48 Mr Scarati acknowledged that the jurisdiction is one where a party might only be ordered to pay costs in circumstances where the Court is satisfied that the party's unreasonable act or omission caused the other party to incur costs. He submitted that the orders made by consent were substantially as sought in the interlocutory application, which had been served some months before the hearing. 49 Mr Scarati further submitted that, whilst there had been submissions made during the course of the hearing regarding whether translations were required as an inherent aspect of the discovery process for all relevant documents, he did not ever seek that level of provision of translations. 50 He submitted that there was an unreasonable act or omission by the Republic in not complying with the consent order made on 6 April and, when the request was made which led to the application being filed, the Republic had acted unreasonably in asserting there had been compliance with the 6 April orders. This is particularly so in circumstances where Mr Scarati had enjoyed substantial success in the outcome of the application. 51 Mr Scarati pointed to the fact that what had been sought was by reference to the records which were required to be maintained by the Republic in English pursuant to the requirements of the FW Regulations. 52 Mr Scarati noted that the request for records was made first in May 2020 and was reflected in the consent order made on 6 April. However, even by the time of the hearing of the application, discovery was not made. As a consequence, the timetable leading to the final hearing had been "thrown into turmoil". 53 Mr Scarati acknowledged that the outcome of the application had been resolved by consent order as a result of concessions which were reasonable, but those concessions had only been made during oral argument. 54 Mr Scarati summarised that there had been an unreasonable act or omission in not complying with the consent orders made on 6 April, that being by not providing documents in a manner that the documents are required to be kept under Australian law, which requirement was, by the time of the hearing of the application, consented to or conceded. 55 The Republic noted the application was put on two primary grounds, namely: (a) there was an unreasonable act or omission in not complying with the order of 6 April; (b) even after it was brought to the attention of the Republic, there was ongoing non-compliance which was unreasonable. 56 The Republic contended that Mr Scarati had sought a broader category of documents than described in the Order of 6 April 2022. Reference was made to communications where a demand was made "to furnish us with English translations of all the documents provided in the list of documents and your email of 5 May 2022". This, the Republic submitted, was broader than simply seeking English translations of the employee records which were covered within the consent order and it was this demand which was contested by the Republic in that there seemed to be no basis for the assertion of an inherent obligation as to discovery for the Republic to be required to translate and cover the cost of a translation of all documents. 57 The Republic submitted that Mr Scarati had sought to rely on such an inherent right by his reference to the decision in Chinatown Enterprises Pty Ltd v Maxims Entertainment Pty Ltd. (Supreme Court of New South Wales, unreported, Levine J, 13 December 1996). In its response, the Republic argued that there was no such broad inherent right. The request was broader than simply the confined categories outlined in the 6 April 2022 order. 58 The Republic also referred to the framing of the interlocutory application which required NAATI certification. It was submitted that this was not required under the FW Act, nor, on any view, was it required as a direct consequence of discovering a foreign language document. The Republic noted that NAATI certification was not included in the consent orders agreed at the hearing. 59 The Republic submitted that there had been no unreasonable act. There was a genuine dispute as to the scope of the parties' obligations during discovery and a dispute about which there was limited guidance, particularly in the context of the FW Act. The Republic made a good faith attempt to resolve the issue and narrow the matters in dispute and, on that basis, it could not be said that the Republic acted unreasonably in resisting the interlocutory application. Discussion 60 As outlined earlier in these reasons, the default position with respect to a matter arising under the FW Act is that a party may be ordered to pay costs incurred by the other party only in accordance with s 570(2). Relevantly, in this case, the requirement of s 570(2) is that the party may only be ordered to pay costs if the Court is satisfied that the party's unreasonable act or omission caused the other party to incur costs. 61 Mr Scarati has sought an order that costs be paid on an indemnity basis. 62 It is first necessary to consider whether any order should be made, based upon the requirements of s 570, and then, if the requirements of s 570 indicate that an order might be made, to consider whether the order should be on an indemnity basis. 63 As I have said earlier, the policy behind s 570 is to free a party from the risk of having to pay the opponent's costs so that those with a genuine grievance and an arguable basis for grievance are not put off from commencing or continuing proceedings – but at the same time protecting parties from incurring costs as a result of the other party's unreasonable acts or omissions. 64 Because of the provisions of s 570, the default position is that each party bear its own costs unless unreasonable acts or omissions causing the other party to incur costs change that position. 65 Where there is a genuine dispute as to legal principles, particularly where there is limited authority or guidance, it is not unreasonable for a party to assert a reasonably arguable position. 66 In this case, the focus of Mr Scarati's argument was on the nature of the consent order and the focus in the consent order on documents which should have been maintained in English (a position now conceded by the Republic). Hence, Mr Scarati argued that it was an unreasonable action by the Republic to have failed to comply with the 6 April order, and that there could be no genuine dispute regarding the scope of the obligations where the 6 April order referred to documents which were required to be maintained in English. 67 As to that issue, in the discussions which were taking place between the parties regarding disclosure of translations, reference was made by Mr Scarati to Chinatown, which was an authority concerning an inherent and general obligation to provide English translations. During the discussions between the parties, the focus was not limited to whether an English translation should be provided because the records were required to be maintained in English. The dispute was, from both sides, on a broader issue. 68 Moreover, it seemed there was a genuine dispute regarding the scope of the translation obligation, even when the obligation was said to be limited to documents which were required to be maintained in English. The focus of discovery is on documents, not on translations of documents (which themselves are new documents). If records were not maintained in English, that might mean there was no document to be disclosed. Without needing to express a view one way or the other, this was clearly a matter which could have been the subject of a genuine dispute and does seem to have been. 69 The other feature of the order sought in the application was the requirement for a NAATI certification. Even on Mr Scarati's argument concerning the significance of the fact that the records were required to be maintained in English, a NAATI certification would not be required. 70 In all those circumstances, I cannot be satisfied that there was an unreasonable act or omission by the Republic which caused Mr Scarati to incur those costs. 71 I will make no order as to costs in relation to the discovery issue. I certify that the preceding seventy-one (71) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Thomas. Associate: Dated: 20 October 2023