Queensland Public Interest Law Clearing House Incorporated

Research paper –

COSTS IN PUBLIC INTEREST PROCEEDINGS IN QUEENSLAND

7 March 2005

Acknowledgements

This research paper has been prepared by Rebekah Leong of the Queensland Public

Interest Law Clearing House Incorporated (QPILCH), with the assistance of Corrs Chambers

Westgarth Lawyers (in particular, Rod Dann, David Starkoff, and Catherine McDougall),

Messrs Damien O’Brien and Darryl Rangiah of counsel, and Mr Peter Lyons QC.

The views expressed in this research paper are QPILCH’s views. They are not

necessarily the views of all members or employees of Corrs Chambers Westgarth, or any of

the other contributors to this research paper.

Table of contents

1 Introduction............................................................................................................ 1 1.1 About QPILCH............................................................................................... 1 1.2 Costs in litigation - the current situation......................................................... 1 1.3 Reasons for reform ......................................................................................... 6 1.4 Outline of this research paper ......................................................................... 8

2 Costs in public interest litigation – the common law............................................. 9 2.1 The Australian experience .............................................................................. 9 2.2 The U.K. experience..................................................................................... 14 2.3 The U.S. experience...................................................................................... 16 2.4 Conclusion.................................................................................................... 19

3 Costs in public interest litigation - legislation ..................................................... 23 3.1 Planning and environmental proceedings..................................................... 23 3.2 Consumer protection..................................................................................... 24 3.3 Judicial review of administrative decisions .................................................. 25 3.4 Uniform Civil Procedure Rules .................................................................... 29 3.5 Conclusion.................................................................................................... 29

4 Security for costs and damages in public interest proceedings............................ 32 4.1 Security for costs .......................................................................................... 32 4.2 Undertakings as to damages ......................................................................... 34 4.3 Conclusion.................................................................................................... 36

5 Suggestions for reform......................................................................................... 38 5.1 Guiding the courts’ discretion as to costs ..................................................... 38 5.2 A preliminary costs hearing.......................................................................... 40 5.3 Harmonising standing and costs ................................................................... 41 5.4 Other options ................................................................................................ 42

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1 Introduction

The issue of costs in public interest proceedings in Queensland has concerned the

Queensland Public Interest Law Clearing House Incorporated (QPILCH) since its inception.

In February 2002, QPILCH delivered a short note to the Attorney-General and Minister for

Justice, the Hon Rod Welford MP, agitating some of the issues that it perceived to be relevant

regarding costs in public interest litigation.1. This research paper undertakes a more detailed

inquiry into this topic, looking at current law, the approach in jurisdictions and suggestions

for reform.

1.1 About QPILCH

QPILCH was formally launched in April 2002 and began as a partnership of law

firms, the Queensland Association of Independent Legal Services Inc, the Queensland Law

Society Incorporated, the Queensland Bar Association, Legal Aid Queensland and Griffith

University Law School. The membership of QPILCH has been steadily increasing – please

visit www.qpilch.org.au to see a complete list of members and services provided.

QPILCH is an incorporated association under the Associations Incorporation Act

1981 (Qld). QPILCH is a non-profit community based legal service that coordinates the

provision of pro bono legal services in public interest matters. Its primary function is to

assess requests for free legal assistance for legal merit and to determine whether the matter is

within the public interest. Matters that satisfy those criteria are then referred to member law

firms and/or barristers to provide pro bono legal assistance. These services are targeted both

at non-profit organisations that advance the public interest and at individuals and groups from

marginalised or disadvantaged backgrounds. In order to assist those most in need QPILCH

also provides some direct services through targeted projects.

1.2 Costs in litigation - the current situation

1.2.1 Costs

Costs refer to the costs expended by parties to a litigation in bringing or defending

their matter. An order as to costs may require:

• one party pay another party’s costs on a standard basis (that is, limited to

those costs necessary or proper for achieving justice);

1 Published on QPILCH’s website – www.qpilch.org.au

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• one party pay another party’s costs on an indemnity basis (that is, all costs

incurred except those costs which were unreasonably incurred or of an un-

reasonable amount); or

• each party bear their own costs.

The Supreme Court has power to award costs in cases brought before them.2 While

specific legislation may regulate the award of costs in particular circumstances, generally

speaking, an award of costs by the Supreme Court (and the District and Magistrates Court) is

governed by the Uniform Civil Procedure Rules which provide:

689 General rule about costs

(1) Costs of a proceeding, including an application in a proceeding, are in the discretion of the court but follow the event, unless the court considers another order is more appropriate.

…

680 General provision about costs

(1) The costs a court may award –

(a) may be awarded at any stage of a proceeding or after the pro-ceeding ends; and

(b) must be decided in accordance with this part….

In other words, while orders as to costs are ultimately at the discretion of the court,

the general rule is that costs “follow the event” and the unsuccessful party in litigation will be

obliged to pay the successful party’s costs. The reason for this approach, which was derived

from English law, was articulated by Mason CJ as follows:3

If one thing is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of the unsuccessful party. They are compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings …

2 Supreme Court Act 1995 (Qld) s 221 3 Latoudis v Casey (1990) 170 CLR 534 at 543.

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However, the court’s discretion regarding costs, as with all discretions, must be

exercised judicially (that is, fairly) and not arbitrarily or capriciously.4 Consequently, courts

have departed from the general rule where “special circumstances” have been demonstrated.

Traditional exceptions focus on the conduct of the successful party which disentitles it to the

beneficial exercise of its discretion, for example, it engages in misconduct relating to the

litigation or leading up to litigation.5 Courts have also departed from the general rule where

the plaintiff only obtains nominal damages, and the defendant obtains its costs justified by its

effective, if not technical, win.6

It has often been argued that litigation undertaken in the “public interest” (the

meaning of which is further discussed in § 2.4.2 below) should be considered as special

circumstances justifying departure. The zenith, and cause célèbre (literally), of costs in public

interest litigation is the decision of Stein J of the New South Wales Land and Environment

Court in Oshlack v Richmond River Shire Council,7 a decision which was ultimately affirmed

by the High Court.8 In that case, Stein J declined to order that the unsuccessful plaintiff,

Mr Oshlack, pay the other parties’ costs in part because the litigation could be characterised

as “public interest” litigation. The decision in Oshlack is critically examined in § 2.1 below.

QPILCH notes that subsequent cases have tended to distinguish Oshlack, rather than liberally

applying it.

1.2.2 Security for Costs

A party (often a defendant or respondent) faced with an impecunious opponent or an

opponent of limited means may apply to the court for an order for security for costs. Such an

order generally stays the action until the opponent pays into court an amount, decided by the

court, to ensure that the prevailing party will receive at least some of its costs.

In Queensland, unless otherwise provided by statute, orders for security for costs are

regulated by Rules 670 to 672 of the Uniform Civil Procedure Rules.

4 See Ruddock v Vardalis (No 2) (2001) 115 FCR 229 at 234 [10] per Black CJ and French J; [2001] FCA 1865, quoting Cretazzo v Lombardi (1975) 13 SASR 4 at 11 per Bray CJ (Zelling and Jacobs JJ agreeing). 5 Oshlack v Richmond River Council (1998) 193 CLR 72 at [69] per McHugh J 6 Oshlack v Richmond River Council (1998) 193 CLR 72 at [70] per McHugh J 7 (1994) 82 LGERA 236. 8 Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11.

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Firstly, under Rule 670, the court may award security for costs as it considers

appropriate upon application by the defendant. That is, an order for security for costs is at the

discretion of the court, subject to Rules 671 and 672.

Secondly, under Rule 671, before the court can award security for costs, it must be

satisfied that:

(a) the plaintiff is a corporation and there is reason to believe the plaintiff will not be able to pay the defendant’s costs if ordered to pay them; or

(b) the plaintiff is suing for the benefit of another person, rather than for the plaintiff’s own benefit, and there is reason to believe the plaintiff will not be able to pay the defendant’s costs if ordered to pay them; or

(c) the address of the plaintiff is not stated or is misstated in the originating process, unless there is reason to believe this was done without intention to deceive; or

(d) the plaintiff has changed address since the start of the proceeding and there is reason to believe this was done to avoid the consequences of the proceeding; or

(e) the plaintiff is ordinarily resident outside Australia; or

(f) the plaintiff is, or is about to depart Australia to become, ordinarily resi-dent outside Australia and there is reason to believe the plaintiff has in-sufficient property of a fixed and permanent nature available for en-forcement to pay the defendant’s costs if ordered to pay them; or

(g) an Act authorises the making of the order; or

(h) the justice of the case requires the making of the order

Thirdly, under Rule 672, in deciding whether to make an order, the court may have

regard to any of the following matters:

(a) the means of those standing behind the proceeding;

(b) the prospects of success or merits of the proceeding;

(c) the genuineness of the proceeding;

(d) for rule 671(a) - the impecuniosity of a corporation;

(e) whether the plaintiff’s impecuniosity is attributable to the defendant’s conduct;

(f) whether the plaintiff is effectively in the position of a defendant;

(g) whether an order for security for costs would be oppressive;

(h) whether an order for security for costs would stifle the proceeding;

(i) whether the proceeding involves a matter of public importance;

(j) whether there has been an admission or payment into court;

(k) whether delay by the plaintiff in starting the proceeding has prejudiced the defendant;

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(l) whether an order for costs made against the plaintiff would be enforce-able within the jurisdiction;

(m) the costs of the proceeding.

If a defendant can show that it is unlikely that the plaintiff will be able to meet a

potential costs order, an order for security for costs will ordinarily be made. Again, however,

there has been some recognition that public interest should be considered when ordering

security for costs, as is evident from Rule 672(i) which may, but not necessarily, be taken into

account.

1.2.3 Undertakings as to Damages

The ordinary rule developed in civil litigation is that, other than in exceptional cir-

cumstances, a plaintiff must give an undertaking as to damages as a precondition to the Court

granting interim or interlocutory relief.9

Rule 264 of the Uniform Civil Procedure Rules formulates the rule as follows (Note:

A “part 2 order” means an injunction, Mareva order10 or Anton Pillar order11):

(1) Unless there is a good reason, the court must not grant a part 2 order until the trial or hearing or until a stated day without the usual undertaking as to damages having been given.

…

(5) In this rule or an order—

usual undertaking as to damages, for a part 2 order, means an undertaking to pay to a person (whether or not a party to the proceeding) who is affected by the order an amount the court decides should be paid for damages the per-son may sustain because of the order.

The court may require an undertaking from a person other than the applicant seeking

the injunction. The court may also require the person giving the undertaking to make a pay-

ment into court or to give other security for the performance of the undertaking: See Rule

265(1) and (2),

In determining whether to order an undertaking as to damages, the court may consider

the matters referred to in Rule 672 regarding security for costs and whether such an order is

9 Sniff v Day (1882) 21 ChD 421 and Auto Securities Limited v STC Limited [1965] RPC 92 10 An order that restrains someone from removing assets from Australia or dealing with assets either in or out of Australia 11 An order, without notice to the respondent, requiring the respondent to permit the applicant or an-other person to enter the respondent’s premises and inspect or seize documents or other items

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otherwise reasonable in all the circumstances of the matter. A pointed difference between an

order for security for costs and undertakings as to damages is that the earlier may be awarded

by the court upon application by the respondent, whereas the latter is awarded as of course

unless there is “good reason”.

1.3 Reasons for reform

There are three central obstacles which face public interest litigants in bringing their

matter to court:

• Knowledge and resources;

• Standing (the rules relating to the right to commence legal proceedings); and

• Costs, undertakings as to damages and security for costs. 12

QPILCH, through its core referral services, tries to overcome the first barrier by as-

sisting public interest litigants to retain private law firms and/or barristers who are prepared to

act on a pro bono or reduced-fee basis, and by providing direct services through its legal clin-

ics and projects.

Standing, although widening in recent years, still remains an obstacle in many public

interest matters and will be the subject of future QPILCH submissions.

However, it is the third barrier with which QPILCH is concerned in this research pa-

per.

In QPILCH’s experience, litigation is often out of the reach of ordinary members of

the community, simply because of its cost. QPILCH notes McHugh J’s comment that “[b]y

any reckoning, the cost of litigation in this country is high.”13 The Queensland Parliament has

recognised this by legislating to ensure that in certain cases, prima facie, each party pays its

own costs.14

Costs are of particular concern in public interest cases, which raise important and of-

ten complex legal issues and must be litigated in superior courts such as the Supreme Court of

Queensland. In public interest matters, particularly where the plaintiff has nothing to gain

12 Keim S and McGrath C, Public Interest Litigation: What access to justice? (2001) Conference paper presented to the Caxton Legal Centre Inc, Access to Justice Conference, Brisbane 12 October 2001 13 Oshlack v Richmond River Council (1998) 193 CLR 72 at 108 [96]. 14 See, e.g., Retail Shop Leases Act 1994 (Qld) s 91 and Small Claims Tribunals Act 1973 (Qld) s 35.

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other than the satisfaction of justice being served, the prospect of an order of costs if unsuc-

cessful acts as a fetter and likely a deterrent for these litigants who would otherwise be will-

ing to litigate important issues.

The oppressive burden of legal costs already constitutes a formidable deter-rent to the citizen of ordinary means who seeks to invoke the jurisdiction of the courts against either an instrumentality of government or a financially powerful corporation or individual.15

Even with decisions like Oshlack, where an exception to the general rule as to costs

has been allowed due to public interest factors, the consideration of such factors and their

scope is far from certain.

Security for costs places a further burden upon the public interest litigant. If such an

order is made against a bona fide, but poorly resourced, public interest litigant, the litigation

is likely to be suspended, often indefinitely. Similarly, if interim relief is necessary and the

court requires an undertaking as to damages which the public interest litigant cannot give,

failure to obtain the interim relief may render further litigation useless. Although the Uniform

Civil Procedure Rules recognises “public importance” as a relevant matter which the court

may take into account when ordering security for costs or damages, there is no obligation

upon the court to do so.

A prime example of the problems facing public interest litigants is Central

Queensland Speleological Society v Queensland Cement and Lime Pty Ltd16. In that case, an

environmental group sought an injunction restraining the respondent corporation from

destroying caves, which were, it was alleged, of importance to the endangered ghost bat and

their destruction therefore contrary to the Fauna Conservation Act 1974 (Qld). In order to

preserve the caves until the final hearing, the environmental group applied for an

interlocutory injunction. The Court of Appeal refused the interlocutory injunction on the basis

that the environmental group did not have standing and could not give an undertaking as to

damages. While the environmental group were granted special leave to appeal to the High

Court, the respondent corporation gave an undertaking not to destroy the caves prior to the

final hearing of the matter, making it unnecessary for the appeal to be heard. The respondent

corporation then applied for security for costs. The environmental group could not give the

security and the matter was struck out by the Queensland Supreme Court. The caves were

subsequently destroyed by the respondent corporation.

15 Jamieson and Brugmans v The Queen (1993) 177 CLR 574 per Deane and Dawson JJ 16 [1989] 2 Qd R 512

8

QPILCH’s overarching goal in seeking reform in relation to costs orders is to

enhance access to justice in public interest cases.

1.4 Outline of this research paper

This research paper focuses on the discretion of Queensland courts to order costs,

security for costs and undertakings as to damages in public interest matters where those

orders are not governed by specific legislation. That is, where the only guidance the court has,

apart from common law, is to be found in the Uniform Civil Procedure Rules as outlined

above.

The research paper is divided into 4 parts (not including the introduction):

1 Costs in public interest litigation – the common law

• A look at judgments which have and have not considered public interest as a

factor in determining the issue of costs, drawing upon the experience of

Australia, the United Kingdom and the United States.

2 Costs in public interest litigation - legislation

• A discussion of Queensland statutes which have sought to confine the discretion

of the courts in public interest matters.

3 Security for costs and undertakings as to damages

• These issues are related to, but somewhat distinct from, the issue of costs in

proceedings. They are therefore considered separately in this paper.

4 Recommendations

• Suggestions for reform.

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2 Costs in public interest litigation – the common law

2.1 The Australian experience

As foreshadowed above, the High Court’s seminal decision in Oshlack v Richmond

River Council.17 is a high-water mark for public interest litigants. However, it is important to

properly understand for what Oshlack is authority in order to understand its impact on

subsequent cases, and the general law relating to costs in public interest proceedings.

2.1.1 Oshlack - Background

Mr Oshlack commenced proceedings in the New South Wales Land and Environment

Court against a council (Richmond River Council) and a developer (Iron Gates Developments

Pty Ltd) challenging a consent given by the council for action by the developer. He alleged

breaches of the Environmental Planning and Assessment Act 1979 (NSW). He was

unsuccessful,18 and the developer and council asked for their costs.

The primary judge, Stein J, heard arguments regarding the costs of the proceeding

and reserved his decision. He had a discretion under s 69(2) of the Land and Environment

Court Act 1979 (NSW) to determine by whom and to what extent costs were to be paid.

Stein J exercised his discretion by making no order as to costs, i.e., that each party to the

proceedings would bear their own costs.19

In coming to his conclusion, Stein J applied the following reasoning (conveniently

summarised by Gaudron and Gummow JJ in the High Court20)–

(i) The "traditional rule" that, despite the general discretion as to costs being "absolute and unfettered", costs should follow the event of the litigation "grew up in an era of private litigation". There is a need to distinguish applications to enforce "public law obligations" which arise under environmental laws lest the re-laxation of standing by s 123 have little significance.

(ii) The characterisation of proceedings as "public interest litigation" with the "prime motivation" being the upholding of "the public interest and the rule of law" may be a factor which contributes to a finding of "special circumstances" but is not, of itself, enough

17 (1998) 193 CLR 72; [1998] HCA 11. 18 Oshlack v Richmond River Shire Council (1994) 82 LGERA 222. 19 Oshlack v Richmond River Shire Council (1994) 82 LGERA 236. 20 (1998) 193 CLR 72 at [20]

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to constitute special circumstances warranting departure from the "usual rule"; something more is required.

(iii) The appellant's pursuit of the litigation was motivated by his de-sire to ensure obedience to environmental law and to preserve the habitat of the endangered koala on and around the site; he had nothing to gain from the litigation "other than the worthy motive of seeking to uphold environmental law and the preservation of endangered fauna".

(iv) In the present case, "a significant number of members of the pub-lic" shared the stance of the appellant as to the development to take place on the site, the preservation of the natural features and flora of the site, and the impact on endangered fauna, especially the koala. In that sense there was a "public interest" in the out-come of the litigation.

(v) The basis of the challenge was arguable and had raised and re-solved "significant issues" as to the interpretation and future ad-ministration of statutory provisions relating to the protection of endangered fauna and relating to the ambit and future administra-tion of the subject development consent; these issues had "impli-cations" for the Council, the developer and the public.

(vi) It followed that there were "sufficient special circumstances to justify a departure from the ordinary rule as to costs".

Importantly, Stein J stopped well short of saying that an unsuccessful applicant in a

public interest case should, as a general rule, not be obliged to pay the respondent’s costs:21

The authorities mentioned have acknowledged the concept of public interest litigation and that the categorisation of proceedings as such may be a factor which contributes to a finding of special circumstances. However, cognisant of the competing rights of successful respondents being deprived of costs, the Court has confirmed that the categorisation of proceedings as public interest litigation of itself is not enough to constitute special circumstances, rather something more is required.

In Oshlack, the “something more” included that: Mr Oshlack had no pecuniary

interest in the outcome of the matter;22 that Mr Oshlack’s legal contentions were

“respectable” and “eminently arguable although unsuccessful”23; and that Mr Oshlack’s case

was one of the first under (then) new provisions regarding endangered fauna and Stein J’s

21 (1994) 82 LGERA 236 at 244. 22 (1994) 82 LGERA 236 at 244, 246. 23 (1994) 82 LGERA 236 at 245.

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analysis of the provisions “w[ould] be helpful to the future administration of the provisions

and enforcement”.24

Presciently, Stein J also wrote:25

I have discussed aspects of the evolution of public interest litigation and costs orders at some length because I think that there exists a degree of misapprehension and misunderstanding in the area.

Although the developer accepted this result, the council did not. It appealed to the

Court of Appeal, which upheld the appeal.26 Mr Oshlack then sought, and was granted,

special leave to appeal to the High Court. The High Court by majority (Gaudron, Gummow,

and Kirby JJ; Brennan CJ and McHugh J dissenting) found in favour of Mr Oshlack and

restored Stein J’s decision.27 Issues raised by the case are usefully considered in a

contemporary article in the Sydney Law Review.28

2.1.2 The reasoning of the High Court in Oshlack

Gaudron and Gummow JJ (in a joint judgment) expressly disavowed any reliance on

the notion of “public interest litigation”.29 The inquiry was whether Stein J’s exercise of his

discretion was “definitely extraneous to any objects the legislature could have had in view” in

enacting the provisions under which Stein J made his costs order.30 After an examination of

what considerations Stein J could have taken into account,31 and the historical antecedents of

the provision under which he awarded costs,32 Gaudron and Gummow JJ affirmed that Stein J

weighed relevant considerations in reaching his decision. His discretion was therefore

wrongfully set aside on appeal.33

24 (1994) 82 LGERA 236 at 245. 25 (1994) 82 LGERA 236 at 244. 26 (1996) 39 NSWLR 622. 27 (1998) 193 CLR 72. 28 Kellie Edwards, “Costs and Public Interest Litigation after Oshlack v Richmond River Council”, (1999) 21 Syd L Rev 680. See also Rachel Baird, “Public Interest Groups and Costs—have the Flood Gates been Opened?” (1998) 15 EPLJ 294. 29 (1998) 193 CLR 72 at 84 [31]. 30 (1998) 193 CLR 72 at 84 [31], quoting Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505 per Dixon J. 31 (1998) 193 CLR 72 at 86–91 [36]–[49]. 32 (1998) 193 CLR 72 at 84–86 [32]–[35]. 33 (1998) 193 CLR 72 at 91 [50].

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(Interestingly, the High Court of New Zealand, in a case decided in between the grant

of special leave in Oshlack and the handing down of judgment, followed essentially the same

reasoning to uphold the Environmental Court’s decision to award costs against a litigant who

was said to be a public interest litigant.34)

Kirby J’s judgment was more broadly based. He considered the wider statutory

context of the environmental legislation Stein J was asked to enforce (including the notion of

public interest litigation),35 as well as the general considerations applicable to a statutory

discretion to award costs.36

McHugh J, in the principal dissenting judgment (Brennan CJ “generally agree[d]”37),

held that “the fact that the proceedings can be characterised as public interest litigation is

irrelevant to the question whether the court should depart from the usual order that costs

follow the event.”38 The difficulty of precisely identifying public interest litigation was a

“significant difficulty”.39 Without a precise definition, the discretion of the court to award

costs could not, in McHugh J’s view, be exercised judicially.40 He considered that the

compensatory basis for the award of costs prevailed.41 However, McHugh J accepted that, in

some circumstances (principally involving public authorities) there might be other reasons for

departing from the usual order as to costs.42

2.1.3 Cases since Oshlack

Subsequent cases have tended to limit Oshlack to its facts (or the particular legislative

provision considered), a trend which is unsurprising since the decision in Oshlack was ulti-

34 Peninsula Watchdog Group (Inc) v Coeur Gold New Zealand Inc [1997] 3 NZLR 463. Salmon J held that, because of the status of the Oshlack appeal, he could “obtain little guidance from decisions of the Australian Courts”: [1997] 3 NZLR 463 at 471. 35 (1998) 193 CLR 72 at 112–115 [108]–[119]. 36 (1998) 193 CLR 72 at 120–123 [134]. 37 (1998) 193 CLR 72 at 75 [3]. 38 (1998) 193 CLR 72 at 91–92 [51]. 39 (1998) 193 CLR 72 at 98 [71]. 40 (1998) 193 CLR 72 at 99 [72]. 41 (1998) 193 CLR 72 at 101–104 [76]–[83]. 42 (1998) 193 CLR 72 at 107 [94].

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mately the exercise of a primary judge’s discretion.43 Soon after Oshlack, the Full Court of

the Federal Court said

:… the majority decision of the High Court [in Oshlack] does not lay down a rule for application in other cases in the making of costs orders. It affirms the width of the discretion conferred upon a court in relation to costs, with par-ticular reference to the specially wide discretion it held to exist under the leg-islation with which Oshlack v Richmond River Council was concerned.44

It is precisely this wide discretion, and the attendant uncertainty, which we hope to

address.

In Physical Disability Council of NSW v Sydney City Council,45 Madgwick J declined

to depart from the usual order as to costs, despite accepting that the litigation was in the

public interest. In that case, the applicant was concerned with the effect removing a bridge

would have on the access to the central business district for physically disabled people. His

Honour held that the applicant’s prospects for success were “little better than speculative”,46

and despite the applicant’s limited capacity to pay an adverse costs order,47 the costs order (in

favour of a local council) was still made.48 One point of distinction is that in Physical

Disability Council, the applicant sought urgent interlocutory relief. However, the urgency of

the relief sought should not be determinative of the issue of costs in public interest matters:

not all disputes can be solved at a leisurely pace, or even with “commendable alacrity”.49

Additionally, courts are willing to find motivations of self-interest and private gain in

proceedings that otherwise fulfil the criteria for public interest litigation.50 If members of

representative groups bring proceedings with some interest in the outcome, rather than

43 See generally House v The King (1936) 55 CLR 499 at 504–505 per Dixon, Evatt, and McTiernan JJ. But see Edgley v Federal Capital Press of Australia Pty Ltd (2001) 108 FCR 1 at 25 [93]–[96] per Beaumont ACJ (Higgins and Gyles JJ agreeing), in which appealable error was shown in making no order as to costs. 44 Friends of Hinchinbrook Society Inc v Minister for Environment & Ors (No 5) (1998) 83 FCR 304 45 [1999] FCA 815. 46 [1999] FCA 815 at [9]. 47 [1999] FCA 815 at [11]–[12]. 48 [1999] FCA 815 at [13]. 49 Equity Access Ltd v Westpac Banking Corporation at (1989) ATPR ¶40-972 at 50,633 per Hill J. 50 E.g., Guide Dog Owners’ & Friends’ Association Inc v Guide Dog Association of New South Wales & ACT (unreported, Federal Court of Australia, Sackville J, BC9803260), Australian Automotive Re-pairers’ Association (Political Action Committee) Inc v NRMA Insurance Ltd (No 2) [2003] FCA 1301 at [12] per Lindgren J.

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someone completely altruistic, courts are reluctant to depart from the general rule.51 Such

reasoning limits the application of Oshlack to the rare case when someone with entirely

altruistic motives is moved to incur expense by litigating.

One of the most promising decisions for public interest litigants since Oshlack is the

Full Court of the Federal Court’s decision in Ruddock v Vardalis (No 2).52 By majority

(Black CJ and French J; Beaumont J dissenting), the court made no order as to costs in

proceedings brought by a Melbourne solicitor and a civil liberties organisation in relation to

persons rescued by the MV Tampa. Black CJ and French J concluded:53

This is a most unusual case. It involved matters of high public importance and raised questions concerning the liberty of individuals who were unable to take action on their own behalf to determine their rights. There was a substantial public and, indeed, international controversy about the Commonwealth’s actions. The proceedings provided a forum in which the legal authority of the Commonwealth to act as it did with respect to the rescued people was, and was seen to be, fully considered by the Court and ultimately, albeit by majority, found to exist. The case is quite different in character from the predominately environmental litigation in which many of the previous decisions concerning the impact of public interest considerations on costs awards have been made. Having regard to its character and circumstances the appropriate disposition is that there be no order as to the costs of the appeal or the application before North J.

As Black CJ and French J make clear, the facts in Ruddock v Vardalis were truly

exceptional. The case therefore does not provide a useful precedent for other litigation.

2.2 The U.K. experience

A convenient place to start consideration of the position in the United Kingdom is the

House of Lords’ decision in Liversidge v Anderson.54 In that case, Mr Liversidge claimed

that his detention by the Home Secretary under World War II regulations55 was unlawful and

claimed damages for false imprisonment. The Home Secretary, Sir John Anderson, argued

that he was acting in good faith under the regulations, and that the matter was one for

51 E.g., Botany Bay City Council v Minister of State for Transport & Regional Development [1999] FCA 65 at [5] per Finn J, Kennedy v Director-General of the National Parks and Wildlife Service (No 2) (2002) 122 LGERA 84 at 87–88 [15] per Talbot J; [2002] NSWLEC 127, Maule v Liproni (No 2) (2002) 122 LGERA 216 at 223–225 [19]–[25] per Lloyd J; [2002] NSWLEC 140, Carriage v Stock-land (Contractors) Pty Ltd [2002] NSWLEC 218 at [16] per Talbot J. 52 (2001) 115 FCR 229; [2001] FCA 1865. 53 (2001) 115 FCR 229 at 242 [29]. 54 [1942] AC 206. 55 Defence (General) Regulations 1939.

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executive discretion. The House of Lords dismissed Mr Liversidge’s appeal, however, after

the speeches had been delivered, Lord Atkin (who dissented in the result) asked counsel for

the Home Secretary:56

[N]othing has been said so far about costs. This is a matter of very general importance, and I think the majority of their Lordships … are rather of opinion that it is not a case in which costs should be asked for.

The reports record that counsel responded that he “should not dream of asking for

[costs] on behalf of the Home Secretary.”57 Although the substantive holding of Liversidge

has been disapproved,58 its consideration of costs has been subsequently approved at the

highest levels.59

In Hanks v Minister of Housing and Local Government,60 Megaw J dismissed an

application to quash a compulsory acquisition order by a borough council, which was

confirmed by the Minister. At the conclusion of the case, both the Minister and the borough

council asked for their costs.61 Megaw J, in the exercise of his discretion, made no order as to

costs. He informed counsel:62

One factor here is that this application is brought by people who, as I held quite properly under the legislation, are threatened with being turned out of their homes. That in itself would not be sufficient or anything like sufficient to make me exercise my discretion in this way, but when there is added to that the fact that there was in my view in this case an important question of principle which had to be resolved some day [about the interrelationship between legislation], in my view that fact turns this into something which ought properly to be regarded as being in the nature of a test case for the advantage of the Minister and of local housing authorities as much as for the public as a whole or particular members of it …

56 [1942] AC 206 at 283. 57 [1942] AC 206 at 283. 58 R v Inland Revenue Commissioners; ex parte Rossminster Ltd [1980] AC 952. See also R v Home Secretary; ex parte Khawaja [1984] AC 75 at 110 per Lord Scarman and 122 per Lord Bridge of Har-wich; Re Patterson; ex parte Taylor (2001) 207 CLR 391 at 502 [330] per Kirby J; Deloitte Touche Tohmatsu v Australian Securities Commission (1995) 54 FCR 562 at 570 per Lindgren J. 59 See Oshlack v Richmond River Council (1998) 193 CLR 72 at 89 [42] per Gaudron and Gummow JJ (describing the decision as a “celebrated example” of the principle). 60 [1963] 1 QB 999. 61 [1963] 1 QB 999 at 1039. 62 [1963] 1 QB 999 at 1039–1040.

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More recently, in New Zealand Maori Council v Attorney-General of New Zealand,63

the Judicial Committee of the Privy Council declined to make an order as to costs of the

appeal:64

Although the appeal is to be dismissed, the applicants were not bringing the proceedings out of any motive of personal gain. They were pursuing the proceedings in the interest of taonga[65] which is an important part of the heritage of New Zealand. Because of the different views expressed by members of the Court of Appeal on the issues raised in this appeal, an undesirable lack of clarity inevitably existed in an important area of the law which it was important that their Lordships examine and in the circumstances their Lordships regard it as just that there should be no order as to the costs on this appeal.

2.3 The U.S. experience

2.3.1 The American Rule

Despite their common ancestry, courts in the United States have a different attitude to

costs than Commonwealth courts.66 The so-called “American Rule”67 as to costs is that a

prevailing party is not entitled to attorney’s fees, whether reasonable or otherwise, without

specific statutory authorisation.68 US legislation approaches orders as to costs in various

ways. In some circumstances, legislation provides that attorneys’ and counsel’s fees can be

recovered by the successful party, but such provisions are often seemingly an additional

punishment for conduct that the legislation considers particularly egregious.69 In other cases,

the award of attorney’s fees is intended “to encourage private litigation” to enforce the law.

Courts are sometimes given a wide discretion to award costs as it considers

appropriate.70 In Ruckelshaus v Sierra Club,71 the Supreme Court considered whether it was

63 [1994] 1 AC 466. 64 [1994] 1 AC 466 at 485. 65 “Taonga” may be translated as “treasures”: [1994] 1 AC 466 at 472, 475. The subject matter of this case was the Maori language, Te Reo Maori, which was accepted to be a “highly prized treasure” of Maori, and in a state of serious decline: [1994] 1 AC 466 at 472, 475. 66 Strictly, the American Rule derives from English practice at the time of independence. See Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454 per McPherson JA. 67 Alyeska Pipeline Co. v Wilderness Society, 421 U.S. 240, 247 (1975), Oshlack v Richmond River Council (1998) 193 CLR 72 at 121 [134] per Kirby J. 68 Key Tronic Corp. v United States, 511 U.S. 809, 814–815 (1994), Alyeska Pipeline Co. v Wilderness Society, 421 U.S. 240, 247, 270–271 (1975). 69 E.g., 17 U.S.C. § 512(f)(2), 35 U.S.C. § 285. 70 E.g., § 307(f) of the Clean Air Act (42 U.S.C. § 7607(f)). 71 463 U.S. 680 (1983).

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“appropriate” to order a wholly successful respondent (a public official) to pay the wholly

unsuccessful party’s attorneys’ and counsel’s fees. A sharply-divided court72 held that, in

order to be entitled to such an award, the party must have demonstrated some success. In

dissent in Alyeska Pipeline Co. v Wilderness Society, Marshall J (with whom Brennan J73

agreed) proposed conditions under which a defendant should be required to pay the

reasonable costs of the plaintiff’s litigation:74

The reasonable cost of the plaintiff’s representation should be placed upon the defendant if (1) the important right being protected is one actually or necessarily shared by the general public or some class thereof; (2) the plaintiff’s pecuniary interest in the outcome, if any, would not normally justify incurring the cost of counsel; and (3) shifting that cost to the defendant would effectively place it on a class that benefits from the litigation.

In finding that the case satisfied the second criterion, the Marshall J said:

Respondents' willingness to undertake this litigation was largely altruistic. While they did, of course, stand to benefit from the additional protections they sought for the area potentially affected by the pipeline… the direct bene-fit to these citizen organizations is truly dwarfed by the demands of litigation of this proportion. Extensive factual discovery, expert scientific analysis, and legal … research on a broad range of environmental, technological, and land-use issues were required. … The disparity between respondents' direct stake in the outcome and the resources required to pursue the case is exceeded only by the disparity between their resources and those of their opponents - the Federal Government and a consortium of giant oil companies.

In California, an established system exists in which the public interest plaintiff can

recover costs if successful and is not liable for costs if unsuccessful. California Private Attor-

ney General Statute CCP 1021.5 (1977)) provides:

1021.5. Upon motion, a court may award attorney’s fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if:

(a) a significant benefit, whether pecuniary or non-pecuniary, has been con-ferred on the general public or a large class of persons,

72 Burger CJ, White, Powell, and O’Connor JJ joined an opinion by Rehnquist J (as he then was). Brennan, Marshall, and Blackmun JJ joined a dissenting opinion by Stevens J. 73 Justice William J Brennan, Jr of the U.S. Supreme Court, not the High Court of Australia’s Sir Gerard Brennan. 74 421 U.S. 240, 284–285 (1975) (Marshall J dissenting).

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(b) the necessity and financial burden of private enforcement, or of enforce-ment of one public entity against another public entity, are such as to make the award appropriate, and

(c) such fees should not in the interest of justice be paid out of the recovery, if any.

With respect to actions involving public entities, this section applies to al-lowances against, but not in favour of, public entities, and no claim shall be required to be filed therefor, unless one or more successful parties and one or more opposing parties are public entities, in which case no claim shall be re-quired to be filed therefor under Part 3 of Division 3.6 of Title 1 of the Gov-ernment Code.

The principle behind the Californian system is simple – if the public interest litigant

wins, they should not be personally out of pocket for acting in the public interest; if they lose,

they should not be penalised for either clarifying the law or testing an issue of public interest

and importance.

2.3.2 Observed consequences of the American Rule

Although the American Rule appears to foster public interest litigation more so than

the general rule that prevails in Australia, QPILCH notes two matters which counter against

its effectiveness in enhancing access to justice.

Firstly, the American Rule encourages pre-emptive (or reactive) suits against public

interest activists or campaigners. Such lawsuits have been labelled “strategic lawsuits against

public participation” or “SLAPPs”.75 A consequence of a SLAPP is that the public-interest

litigant is required to spend money defending (what they generally consider to be) a frivolous

proceeding, effectively stifling litigation of their primary concern. Under the American Rule,

a typical SLAPP applicant is at limited risk of having an award of attorney’s fees made

against them, and a public interest litigant can not recover their costs of defending the

proceedings.

Secondly, the American Rule may be said to encourage proceedings which in Austra-

lia would be considered frivolous, vexatious, or an abuse of process. However, in the United

States, because there is often no possibility of a costs sanction, there is little deterrent from

commencing these suits. A recent example of this phenomenon is a case decided last October

75 See Andrew T Kenyon, “Defamation and critique: political speech and New York Times v Sullivan in Australia and England”, (2001) 25 MULR 522; [2001] MULR 18. In Chapman v Conservation Coun-cil of South Australia (2002) 82 SASR 449; [2002] SASC 4, Williams J considered (inter alia) whether allegations of commencing a “SLAPP” were defamatory.

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by the Court of Appeals for the Ninth Circuit: The Cetacean Community v Bush.76 The sole

plaintiff in that case was “The Cetacean Community”, a name chosen by the community’s

self-appointed attorney for all whales, porpoises, and dolphins. The community alleged that

the U.S. Navy’s use of low frequency active sonar violated federal law. The proceeding was

ultimately dismissed for want of standing.

2.4 Conclusion

There are several issues which need to be addressed in formulating any approach to

costs in public interest litigation.

1 What should be the starting point in ordering costs?

2 What is “public interest”?

3 What other factors need to be considered?

2.4.1 What should be the starting point in ordering costs?

To reiterate, in Queensland, the general rule is that costs of a proceeding follow the

event, unless the court considers another order is more appropriate.77 There is no obligation

upon the courts to consider public interest factors, apart from precedents set in the common

law.

This general rule was derived from English law. Courts of both jurisdictions have

considered “public interest” to be a reason (but not the sole reason) for departure from the

general rule and declining to order costs against an unsuccessful litigant.

In contrast, the United States starts with the principle that each party bears its own

costs unless statute provides otherwise. While there are obvious advantages for public interest

litigants with this approach, it carries with it the significant disadvantage of being unable, as a

general rule, to recover costs if successful. Nonetheless, the American Rule demonstrates that

there are different ways of approaching the question of costs, and that different or innovative

ways of resolving the issue should not be discounted without thorough discussion.

It is suggested that that the approach to determining costs orders should continue to

be at the discretion of the judge with the general rule that costs follow the event. However,

76 386 F.3d 1169 (9th Cir. 2004). The case was recently noted by Justice Young as general editor of the Australian Law Journal: (2005) 79 ALJ 7 at 8. 77 Rule 689, Uniform Civil Procedure Rules

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the courts should be given express mandate to depart from the general rule in public interest

matters by making “public interest” a mandatory consideration in the exercise of their

discretion.

2.4.2 What is “public interest”?

Defining what is “public interest” has proved a difficult task. In 1995, the Australian

Law Reform Commission wrote:78

No clear definition of public interest exists in legislation or case law. The courts have preferred to leave the definition open and to determine the question of public interest on the basis of the circumstances of each case. However, the courts give some guidance as to how the question is to be approached. A widely accepted approach is to see whether the case affects the community or a significant sector of the community or involves an important question of law. It also seems that particular types of cases are more likely to be found to be in the public interest. These include cases involving issues of national security or concerning the efficient and fair administration of justice. For the purposes of this report, public interest litigation includes test cases.

Similarly, all members of the High Court in Oshlack v Richmond River Council

agreed that public interest litigation was difficult to define:79 Gaudron and Gummow JJ

described it as a “nebulous concept”,80 McHugh J (with whom Brennan CJ generally

agreed81) said it was “inherently imprecis[e]”,82 and Kirby J accepted that “it is difficult to

define with precision”.83

From the above the following appear to have been characteristic, but not in

themselves determinative, of “public interest litigation”:

• The “prime motivation” in bringing proceedings is the upholding of ‘the

public interest and the rule of law”

78 Australian Law Reform Commission, Report No. 75, Costs shifting—who pays for litigation (1995), p 143, par 13.2. 79 See Kellie Edwards, “Costs and Public Interest Litigation after Oshlack v Richmond River Council” (1999) 21 Syd L Rev 680 at 691. 80 (1998) 193 CLR 72 at 84 [30], quoting South Melbourne City Council v Hallam (No 2) (1994) 83 LGERA 307 at 311. 81 (1998) 193 CLR 72 at 75 [3]. 82 (1998) 193 CLR 72 at 98 [71]. 83 (1998) 193 CLR 72 at 124 [136].

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• The views of the applicant are shared by the public generally, some class

thereof or a significant number of people;

• The case raises issues of general importance;

• The case is a test case, from which the defendant can benefit because it will

resolve “significant issues” as to the interpretation and future administration

of statutory provisions or other law (ie, costs are effectively placed on the

party that benefits from the litigation);

• The applicant does not personally benefit from the litigation.

The last criteria is of particular concern as there are many instances where an

applicant may bring proceedings which although ultimately benefit the applicant, also raise

issues of broad public importance and would be considered, by QPILCH at least, in the public

interest (for example, stolen wages cases). It is accepted that pecuniary interest is an objective

indicator by which private interest can be distinguished from public interest. However, the

fact of personal benefit needs to be viewed in the context of all the circumstances (for

example, see US case of Alyeska Pipeline Co. v Wilderness Society discussed at § 2.3.1

above), and not in itself preclude the matter from being considered in the public interest.

Factors used by QPILCH to identify “public interest” proceedings

In providing its core referral services, QPILCH has developed “eligibility criteria” to

determine whether QPILCH can offer assistance in any given case. The second of these

eligibility criteria requires that the matter is of “public interest” in that:

1 The matter affects a significant number of people; or

2 The matter raises matters of broad public concern; or

3 The matter requires legal intervention to avoid a significant and avoidable

injustice; or

4 The matter particularly impacts upon disadvantaged or marginalised groups.

(Additionally, the applicant must meet a means test, the matter must require a legal

remedy or other legal assistance, and the matter must require addressing pro bono publico,

i.e., for the common good.)

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To some extent, the four indicia can overlap. However, in QPILCH’s experience, the

criteria have proven effective in determining which cases are in the “public interest”, at least

for QPILCH purposes, and in identifying persons who are most deserving to receive QPILCH

assistance. They are also consistent with the factors identified, and applied, by Australian and

English courts (described in §§ 2.1 and 2.2 above).

Some or all of the QPILCH criteria may be appropriate in the consideration of

whether a matter is “public interest litigation”.

2.4.3 What other factors need to be considered?

Public interest cannot be viewed in a vacuum. There are other factors that the court

must take into account in determining costs.

The cases discussed above have considered the following additional factors in deter-

mining whether costs should or should not follow the event:

• The applicant’s reasonable prospects of success.

• Whether an order as to costs is consistent with the scope, nature and object of

the legislation which authorised the litigation.

• The applicant’s purpose in commencing litigation.

• The financial resources of the applicant.

• Whether it is in the interests of justice to order the unsuccessful party to a

costs order.

• The conduct of the applicant (and the defendant).

• All the other circumstances of the case.

The weight given to the “public interest”, and any other factor, can really only be left

to the discretion of the judge in the circumstances of the case. However, in order to attain a

level of certainty regarding costs orders, the various factors to be considered may need to be

clarified.

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3 Costs in public interest litigation - legislation

While we are primarily concerned with costs in public interest litigation where

legislation does not make provision for the award of costs (apart from the Uniform Civil

Procedure Rules), it is useful for discussion purposes to review legislation commonly

perceived as being in the “public interest”, and how they deal with the issue of costs. We have

focused on Queensland legislation, rather than interstate or Commonwealth legislation.

We stress that this is not meant to be exhaustive of Queensland public interest

legislation, but rather is meant to provide some suggestions as to how the issue of costs in

public interests matters generally could be provided for by legislation.84

3.1 Planning and environmental proceedings

3.1.1 Integrated Planning Act 1997

One obvious example of public interest litigation is in the environmental sphere.85

Aggrieved activists or residents can seek review of development approvals. Indeed, this was

the situation in Oshlack. The relevant legislation in Queensland, the Integrated Planning Act

1997 (Qld), facilitates this by allowing “any person” to commence a proceeding under that

Act.86

Under the corresponding New South Wales legislation, considered in Oshlack, the

general rule as to costs remained applicable to proceedings in the Land and Environment

Court. In Queensland, the general rule as to costs in the Planning and Environment Court is

displaced by the Integrated Planning Act 1997. Generally (with some uncontroversial

exceptions87) each party to proceedings must bear their own costs of proceedings in that

court.88

3.1.2 Environmental Protection Act 1994

Under the Environmental Protection Act 1994 (Qld), a person whose interests are

affected, or anyone else with the leave of the court, may bring proceedings in the Planning

and Environment Court for an order to remedy or restrain an offence (or anticipated offence)

84 See Oystertec plc v Edwards Evans Barker (2002) 56 IPR 338 at 340 [8] per Jacobs J; [2002] All ER (D) 192; [2002] EWHC 2324 (Patents). 85 See Oshlack v Richmond River Shire Council (1994) 82 LGERA 236 at 238–239 per Stein J. 86 E.g., Integrated Planning Act 1997 (Qld) s 4.1.21(1). 87 Integrated Planning Act 1997 (Qld) s 4.1.23(2)–(7). 88 Integrated Planning Act 1997 (Qld) s 4.1.23(1).

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against the Act (“restraint order”).89 In deciding whether or not to grant a person leave, the

court must be satisfied, among other things, that:

• There is a real or significant likelihood that the requirements for the making

of an restraint order will be satisfied;

• It is in the public interest that the proceeding should be brought;

• The person is able to adequately represent the public interest in the conduct

of the proceedings.90

Additionally, the court must not refuse to grant leave merely because the person’s in-

terest is no different from someone else’s interest in the subject matter.91 (Significantly, how-

ever, the court may grant leave subject to conditions, expressly including conditions of secu-

rity for costs and undertakings as to damages.92)

In relation to costs, the court must order a plaintiff to pay costs if the court is satisfied that the

proceeding was brought for obstruction or delay.93 Otherwise, despite the detailed provisions

in relation to standing, orders as to costs are left to the court’s general discretion.

3.2 Consumer protection

Under the Trade Practices Act 1974 (Cth), “any person” can commence proceedings

for injunctions94 and declarations.95 Findings in these proceedings are prima facie evidence of

those facts in subsequent proceedings for relief.96 The High Court recently affirmed that the

expression “any person” in the Trade Practices Act “means what it says”.97 This was a

89 Environmental Protection Act 1994 (Qld) s 505 90 Environmental Protection Act 1994 (Qld) s 505(2) 91 Environmental Protection Act 1994 (Qld) s 505(3) 92 Environmental Protection Act 1994 (Qld) s 505(4) 93 Environmental Protection Act 1994 (Qld) s 505(10) 94 Trade Practices Act 1974 (Cth) s 80(1). 95 Trade Practices Act 1974 (Cth) s 163A(1). Any person may also apply for a divestiture order: Trade Practices Act 1974 (Cth) s 81(1). However such an order can only be made if s 50 is found to have been contravened. State courts do not have jurisdiction to consider s 50 matters: Trade Practices Act 1974 (Cth) s 86(2). Such proceedings are special federal matters under the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth) and the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Qld). 96 Trade Practices Act 1974 (Cth) s 83. 97 Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 601 [13] per Gleeson CJ and McHugh J; [2000] HCA 11.

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deliberate choice by the Commonwealth Parliament,98 encouraging compliance with the

norms of conduct established in Part V of the Trade Practices Act, in particular s 52

(misleading and deceptive conduct).99

Similar provisions exist in the Fair Trading Act 1989 (Qld).100 Queensland courts

have jurisdiction under both Acts.

Clearly, proceedings under the Trade Practices Act and the Fair Trading Act may be

undertaken in the “public interest”. Such a motive is supported by open standing provisions.

However, there is no provision for cost relief in public interest matters, and consequently

costs are left to the discretion of the judge under the Uniform Civil Procedure Rules.

3.3 Judicial review of administrative decisions

The Judicial Review Act 1991 (Qld) provides a statutory mechanism for the review of

administrative decisions made under an enactment by the Queensland government or its

instrumentalities. The statutory review process in the Act replaced the prerogative writs of

certiorari, prohibition, and mandamus, which were previously issued by the Supreme

Court.101

Section 49 of the Judicial Review Act provides the court with a specific power to

depart from the usual costs order in judicial review applications. Upon application by a party

(the “relevant applicant”) the court may order:

• that another party indemnify the relevant applicant for its reasonable costs

incurred on the standard basis from the time of the costs application (see s

49(1)(d)); or

• that a party bear only its own costs of the proceeding, regardless of the

outcome of the proceeding (see s 49(1)(e)).

98 See Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 602–603 [17]–[20] per Gleeson CJ and McHugh J, 608–610 [37]–[41] per Gaudron J, 619–622 [69]–[75] per Gummow J, 640–643 [131]–[137] per Kirby J, 665 [194]–[195] per Callinan J. 99 See generally Russell Miller, “From acorn to oak tree: The spreading branches of s 52 of the Austra-lian Trade Practices Act 1974”, (2005) 79 ALJ 43. 100 Fair Trading Act 1989 (Qld) s 98. Indeed, the Fair Trading Act is broader than the Trade Practices Act in at least one respect. Under s 98 of the Fair Trading Act, “any person” can seek an injunction in relation to an undertaking given to the Commissioner for Fair Trading under s 91H. Only the ACCC can enforce undertakings given to it under s 87B of the Trade Practices Act, although the conduct is considered wrongful and may be collaterally attacked by others: see Dresna Pty Ltd v Misu Nominees Pty Ltd [2004] FCAFC 169 at [18] per Kiefel and Jacobson JJ. 101 Judicial Review Act 1991 (Qld) s 41(1).

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In considering the costs application, the court must have regard to the factors listed in

s 49(2):

(a) the financial resources of:

(i) the relevant applicant; or

(ii) any person associated with the relevant applicant who has an interest in the outcome of the proceeding; and

(b) whether the proceeding involves an issue that affects, or may affect, the public interest, in addition to any personal right or interest of the relevant applicant; and

(c) if the relevant applicant is [the person who made the review applica-tion] - whether the proceeding discloses a reasonable basis for the re-view application; and

(d) if the relevant applicant is [not the person who made the review ap-plication] - whether the case in the review application of the relevant applicant can be supported on a reasonable basis.

…

(4) Subject to this section, the rules of court made in relation to the awarding of costs apply to a proceeding arising out of a review appli-cation.

3.3.1 Purpose of section 49

The purpose of a preliminary costs order is that:102

Such a course will be less likely to deter private citizens from challenging government decisions which affect them, and thus advance the general intent of the Act that persons aggrieved should have a practical means of challenging such decisions.

Similarly, in Crew v Mitchell, Mackenzie J said:103

[T]he principle is merely a variation of the ordinary rule that costs follow the event. Presumably, the philosophy underlying it is that a person affected by an administrative decision under an enactment should not be deterred by the fear of ruinous liability for costs from seeking relief on reasonable grounds in a case where it is alleged that the decision-making process was flawed. Where the particular application displays some or all of the characteristics listed in [the legislation], there is a discretion to deprive the successful party of costs that would otherwise be awarded, in an appropriate case when they are weighed together.

102 Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454 at 455 per Fitzgerald P. 103 [2004] QSC 307 at [9].

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The enactment of s 49 stemmed from recommendations made by the Electoral &

Administrative Review Commission in its December 1990 Report on Judicial Review of

Administrative Decisions and Actions. The Commission said:104

The Commission favours the proposal … conferring upon the Supreme Court a power to consider and make orders about costs at an early stage of the proceedings, so that meritorious cases can be pursued without the uncertainty as to the costs outcome which presently besets even a worthy application for judicial review. The Commission considers that this proposal has the potential … to effectively discourage unnecessary litigation (by making the normal cost rules apply apart from a successful application to the court for exercise of a special power in respect of costs) while providing an incentive for legitimate claims to proceed.

By s 49, the Judicial Review Act expressly acknowledges that judicial review of

administrative action may be in the public interest and taken by persons without significant

financial resources. It evinces a legislative policy that, in those cases, the public interest

litigant should be relieved from the operation of the general rule as to costs.

3.3.2 Application of section 49

Although s 49 allows any party (other than the person whose decision, conduct or

failure to make a decision is the subject of the application) to make an application, it is most

commonly used by applicants for an order of review. The experience of this provision is that

where a public interest litigant lacking significant financial resources makes an application for

judicial review, the Supreme Court is willing to grant relief from costs.

In Commissioner of Police Service v Cornack,105 a decision of a Magistrate was

reviewed and the appeal successful. However, the respondent was awarded his costs under

s 49(1)(d) given the public interest in the State having the law clarified and the resources of

the respondent (who had not made the decision under review) were limited. This is the only

case where an order under s 49(1)(d) has been made and upheld. (An order under that

provision was made in Anghel but was overturned on appeal.106)

The courts have regarded the most important matters with respect to an application

under s 49(1)(e) as being whether there is an issue of general public importance raised by the

litigation and whether the application has merit or whether it is untenable.

104 Judicial Review of Administrative Decisions and Actions (1990), par 10.23. 105 [2004] 1 Qd R 627; [2003] QCA 383. 106 Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454.

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Ordinarily, where an application for review is summarily dismissed, that is an

indication that the application was untenable and costs will usually follow the event.

However, provided that the litigation has some merit, courts have generally been willing to

consider an order that each party bear its own costs.

The motivation of advancement of the public interest more than self-interest has been

held to be relevant to the making of the order under s 49(1)(e).107 In Cairns Port Authority v

Albietz,108 Thomas J said in relation to an application under s 49:

An obvious example calling for the exercise of this particular power is the case of an impecunious applicant who applies for an indemnity at an early stage of proceedings in which a public authority may obtain the benefit of a test ruling or clarification of some point of practice or of public importance.

In Ford v Legal Aid Commission of Queensland,109 the court ordered that there be no

order as to costs as the litigation was in the public interest. Conversely, in cases where the

application was brought substantially in order to advance a private interest, rather than public

interest, an order under s 49(1)(e) has been refused.110 In Anghel,111 the Court of Appeal held

that although the applicants had private interests in the application,112 nevertheless an order

should be made under s 49(1)(e) because of the applicant’s limited resources, the

reasonableness of their claim, and that there was a broader public interest as well.113

In Anghel, Fitzgerald P expressly left open the question of whether the matters to

which regard is to be had under s 49(2) are exhaustive, or whether other matters can also be

considered.114 The prevailing view in subsequent cases is that the factors are not

exhaustive.115

107 E.g., Save Bell Park Group v Kennedy [2002] QSC 174, Brogden v Commissioner of the Police Ser-vice [2001] QSC 123. 108 [1995] 2 Qd R 470 at 475. 109 Unreported, Supreme Court of Queensland, Ambrose J, 16 May 1997, Ambrose J, BC9702290. 110 See Barker v Queensland Fire and Rescue Authority [2000] QSC 395, Connie v O’Sullivan [2000] QSC 307, Geraghty v Dairy Industry Tribunal [2000] QSC 145. 111 Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454. 112 [1995] 2 Qd R 454 at 460–461 per McPherson JA. 113 [1995] 2 Qd R 454 at 455–456 per Fitzgerald P, 460–461 per McPherson JA, 463 per Shepherd-son J. 114 Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454 at 455. 115 See Lyness v Fennell (unreported, Supreme Court of Queensland, Mackenzie J, 27 March 1998, BC9800936) and Sharples v Council of the Queensland Law Society Inc [2000] QSC 392 at [26] per Mullins J.

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3.3.3 Costs orders may still be made in frivolous, vexatious, and unmeritorious

cases

Section 49, does not affect the court’s discretion to make appropriate costs orders

against litigants in cases that are frivolous, vexatious, or unmeritorious.116 Similarly, s 49

does not prohibit the court from making an order for costs on an indemnity basis117 in

appropriate cases, for example, where the application is wholly without merit.118

3.4 Uniform Civil Procedure Rules

The Uniform Civil Procedure Rules does not provide any guidance as to the consid-

erations the court may take into account in making costs orders. However, as referred to ear-

lier, the Rules do list matters to which the Court may have regard in determining security for

costs or undertakings as to damages.

The matters include:

• the means of those standing behind the proceeding;

• the prospects of success or merits of the proceeding;

• the genuineness of the proceeding;

• the impecuniosity of a corporation;

• whether the plaintiff’s impecuniosity is attributable to the defendant’s con-duct;

• whether the plaintiff is effectively in the position of a defendant;

• whether the proceeding involves a matter of public importance;

• the costs of the proceeding.119

There is no reason why these factors could not be applied in determining costs orders.

3.5 Conclusion

The Judicial Review Act, and to some extent the Uniform Civil Procedure Rules,

demonstrates that legislation can be used successfully to guide the discretion of the courts in

116 See Bell v Beattie [2003] QSC 388 and BB v Liebsanft [2003] QSC 389. The court has the power to summarily dismiss review proceedings in identified circumstances: Judicial Review Act 1991 (Qld) s 48. 117 Previously the solicitor and client basis: Uniform Civil Procedure Rules 1999 (Qld) r 743(b). 118 E.g., Sargent v South East Queensland Electricity Board (unreported, Supreme Court of Queen-sland, de Jersey CJ, 7 April 1999, BC9901624). See also Anghel v Minister for Transport (No 2) [1995] 2 Qd R 454 at 455 per Fitzgerald P. 119 Uniform Civil Procedure Rules, r 672

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ordering costs, in departure from the general rule that costs follow the event. On the other

hand, the lack of cost provisions in the Environmental Protection Act and consumer

protection legislation shows the need for reform in relation to costs in public interest litigation

generally.

Express legislative provision for consideration of the public interest also serves a

further purpose – it expressly mandates (and therefore encourages) the court’s consideration

of public interest issues which are traditionally thought to be irrelevant when determining

orders as to costs.

Section 49 of the Judicial Review Act and even Rule 672 of the Uniform Civil

Procedure Rules provide a convenient starting point upon which to model a general public

interest cost provision. Guidance can also be taken from the drafting of broad standing

provisions, which allow persons to pursue litigation even though they have no direct interest

in the outcome.

Review of the above legislation has raised the following matters, in addition to the

concluding comments of § 2:

• In determining costs in public interest matters, additional factors which the court may

find relevant are:

o Whether the person is able to adequately represent the public interest in the

conduct of the proceedings (Environmental Protection Act, s 505(2))

o Looking at the financial resources of any person associated with or standing

behind the public interest litigant (Judicial Review Act, s 49(2)(a), UCPR r

672(a));

o Whether there is a reasonable basis for the proceeding (Judicial Review Act, s

49(2)(a))

o The “genuineness” of the proceeding (UCPR r 672(c))

o Whether, if the public interest litigant is impecunious, whether the impecuniosity

is attributable to the defendant’s conduct (UCPR r 672(e))

o whether the plaintiff is effectively in the position of a defendant (UCPR r 672(f));

o the costs of the proceedings (UCPR r 672(m)).

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• There should be retained the discretion of the court to order the costs appropriate in

the circumstances of the case, including costs against an unsuccessful public interest

litigant and costs on an indemnity basis.

• The timing of costs orders needs to be considered. Costs determined as a preliminary

issue provides certainty to the public interest litigant, but may also have (detrimental)

consequences on how the parties later conduct themselves in the running of the case.

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4 Security for costs and damages in public interest proceedings

The making of orders for security for costs and the requirement to give undertakings

as to damages have the potential to significantly stifle public interest litigation. Toohey J’s

extra-curial comment in relation to costs orders, that “there is little point in opening the doors

to the Courts if litigants cannot afford to come in”,120 applies equally to orders for security for

costs and undertakings for damages. There is little to be gained in providing avenues for

individuals or public interest organisations to bring public interest litigation through

addressing concerns such as standing without also addressing fundamental procedural issues

such as security for costs and undertakings as to damage which provide practical hurdles to

prosecuting a case to conclusion.

A review of decisions both in Australia and other Commonwealth countries suggests

that there has been some recognition by the courts of these procedural difficulties for persons

pursuing public interest litigation. The courts’ response has been to identify that the fact that

the litigation is being pursued in the public interest is a relevant consideration in exercising

the discretion to order security or require an undertaking as to damages. The question that

QPILCH believes now arises for consideration is whether there should be statutory

recognition of the important role that public interest litigation plays, by introducing a

statutory requirement that generally requires (as opposed to merely suggesting) courts to

consider the fact that the litigation is public interest litigation when dealing with such

procedural issues.

4.1 Security for costs

An order that a plaintiff provide security for costs has real potential to preemptively

terminate public interest litigation. Generally, security for costs will not be ordered against an

individual. However, in much public interest litigation, the plaintiff is not an individual but a

non-profit public interest organisation. Generally, if a defendant can show that it is unlikely

that a plaintiff corporation will be able to meet any costs order that might be made in the

litigation, an order for security for costs will be made. Public interest and community

organisations generally have few, if any, assets. It is not difficult to imagine that in most

cases the general conditions for an order for security for costs would be met.

120 Quoted in Oshlack v Richmond River Shire Council (1994) 82 LGERA 236 at 238 per Stein J.

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A review of Australian case law suggests that it is generally accepted in Australia that

the fact that the plaintiff is pursuing litigation in the public interest is a relevant factor for the

court to consider in making an order for security for costs.

Recognition of the public interest nature of the litigation being a relevant factor in

exercising the discretion to order security for costs has largely arisen out of environmental

litigation in Australia. In Maritime Services Board of New South Wales v Citizens Airport

Environment Association Inc,121 Kirby P refused an application for security for costs for an

appeal on the basis that it involved public interest litigation, finding it to be a relevant

consideration in ordering security for costs:

Accordingly, I do not believe that it is appropriate to consider this case as just another suit between ordinary litigants disputing claims of private interest only to themselves. When considering whether “special circumstances” had been made out, and whether an order for security for costs of the appeal should be made, it is appropriate to keep in mind the nature of the case and the public interest reasons which may lie behind the bringing of it.

A similar approach was taken by Priestley JA in Brown v Environment Protection

Authority,122 where he took into account a number of matters in refusing security for costs,

including whether the subject matter of the appeal was of “importance … to the community

generally” and Pearlman CJ in what is known as the “Club Med case”, Byron Shire

Businesses for the Future Inc v Byron Shire Council.123

That the litigation involves public interest is a discretionary factor which should be

taken into consideration in deciding whether security for costs should be ordered has been

adopted as an appropriate principle in other jurisdictions throughout Australia, including

Victoria124 and in Queensland.125 Similarly, the Federal Court of Australia has held public

interest considerations to be relevant in determining whether to make an order under s 56 of

121 (1992) 83 LGERA 107 at 112. 122 Unreported, New South Wales Court of Appeal, Priestley JA, 1 April 1993. 123 (1994) 83 LGERA 59. 124 Smail v Burton [1975] VR 776 at 777–778, Cardynal v Dodek [1978] VR 414. 125 Arnold v Queensland (1987) 6 AAR 463 at 469.

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the Federal Court of Australia Act 1976 (Cth).126 It has also been considered in New

Zealand:127

In acting in a responsible way as watchdogs of the public interest community organisations perform a valuable public service. Having in the public interest opened the Court door to the airing of public law questions, the public interest in having those questions proceed to hearing and determination must be a factor for consideration in deciding whether to order security, and if so, at what figure it should be fixed.

There has also been overseas consideration of the influence of costs on the ability of

citizens to enforce breaches of environmental law. For example, in 1993, a draft European

Community Directive was developed concerning access to justice in environmental matters.

Article 8(1) on costs provides (emphasis added):

Member states shall take the necessary steps to ensure that the cost of administrative and judicial proceedings under Articles 3 to 7, including lawyers’ and experts’ fees and possible security deposits, shall not cause a barrier to the commencement or continuation of such proceedings. In particular they shall ensure that the plaintiff in case of success obtains recovery of all costs reasonably incurred, either from the defendant or from State funds. If the action is unsuccessful but has been brought on the basis of an arguable case and in good faith, the plaintiff shall not be required to pay court fees or the costs of other parties, and these costs shall be borne by State funds. Exceptions may be made for unnecessary expenses caused by the conduct of the plaintiff.

4.2 Undertakings as to damages

A similar approach has been taken in Australia in relation to undertakings as to

damages. These are undertakings offered by a party who obtains the benefit of an interim or

interlocutory injunction to pay the damages suffered by the enjoined party if the injunction is

ultimately found to have been wrongly granted. There has been recognition, particularly in

relation to environmental litigation, that if the litigation involves matters of public interest,

that is a relevant consideration in determining whether an undertaking as to damages should

be required.

Ordinarily, in civil litigation, this undertaking must be given before the court will

grant the interim or interlocutory injunction.128 In more recent times, the rule has gone even

126 Equity Access Ltd v Westpac Banking Corporation (1989) ATPR ¶40-972 at 50,635 per Hill J, Chapman v Luminis Pty Ltd [2002] FCA 496 at [13] per Tamberlin J, Croker v Sydney Institute of TAFE [2003] FCA 942 at [26], [40] per Bennett J. 127 Ratepayers & Residents Action Association Inc v Auckland City Council [1986] 1 NZLR 746 at 750 per Richardson J (Somers J agreeing).

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further. Courts have not only required the undertaking to be given, but have looked behind

the undertaking to determine its worth. For the same reasons identified in relation to an order

for security for costs above, the fact that the courts generally not only require an undertaking,

but will examine the worth of the undertaking, is of real concern for individuals and

community organizations who seek to pursue litigation in the public interest.

Since the mid-1980s, courts have recognised that, in determining whether an

undertaking as to damages is required for making interlocutory injunctions, it is appropriate to

examine whether the litigation has any public interest elements. This approach is best

typified by the leading case of Ross v State Rail Authority of New South Wales,129 where

Cripps J identified the appropriate approach:

It would seem to me, therefore, that where a strong prima facie case has been made out that a significant breach of an environmental law has occurred, the circumstance that an applicant is not prepared to give the usual undertaking as to damage is but a factor to be taken into account when considering the balance of convenience. In this regard, I respectfully adopt the observations of Bowen CJ in [Commercial Bank of Australia Ltd v Insurance Brokers Association of Australia130]. The court ought inquire from an applicant whether he or she is willing to give an undertaking as to damages. The court should then take into account, on the balance of convenience, the presence or absence of such an undertaking as one of the factors to be considered in the exercise of its discretion …

In the passage to which Cripps CJ referred, Bowen CJ held:

Under s 80 [of the Trade Practices Act 1974 (Cth)], a private person has statutory authority to bring the proceedings and this appears to absolve him from the necessity of obtaining the fiat of the Attorney-General. Whether this should assimilate his position to that of the Attorney-General suing to enforce the public interest or to a private individual suing by relation is not entirely clear. The approach of the Court, I think, should be that it will inquire from a private person seeking an interim injunction whether he is willing to give an undertaking as to damages. The Court should then take into account on the balance of convenience the presence or absence of such an undertaking as one of the factors to be considered in exercising its discretion.

128 Sniff v Day (1882) 21 Ch D 421, Auto Securities Limited v STC Limited [1965] RPC 92. 129 (1987) 70 LGRA 91 at 100. 130 (1977) 16 ALR 161 at 169.

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Likewise, Deane J held in Phelps v Western Mining Corporation Ltd (again in

relation to s 80 of the Trade Practices Act): 131

It is patently desirable that the legislature does not assume that traditional rules of the common law relating to locus to institute civil proceedings are universally appropriate to circumstances where laws are increasingly concerned with the attainment and maintenance of what are seen as desirable, national, economic and commercial objectives and standards and with the protection not only the life and liberty of the citizen but of the environment in which he lives and the quality of the life which he may lead. There is little merit in approaching the construction of a statute on the basis that it is to be presumed that the Parliament has in fact ill-advisedly made such an assumption. There is no merit in the erection of a curial ambush of shibboleths in which even a legislative intent if evinced by words as clear as those used in s 80(1)(c) would lie entrapped.

In the United States, proceedings initiated by persons other than the government for

interlocutory injunctive relief generally require the providing of security, although there has

been recognition that in relation to the public interest litigation that a court should not require

the posting of security in an amount which would effectively stifle the intent of legislation

which allowed the bringing of such claims.132

4.3 Conclusion

In Australia there is a body of case law supporting the view that courts, when

exercising their discretion to order security for costs or to require an undertaking as to

damages, should consider the fact that the litigation involves matters of public interest. Much

of that case law, however, involves cases where there were specific statutory provisions

providing for a greater range of persons having standing to bring proceedings (e.g.,

environmental litigation and cases brought under the Trade Practices Act). In finding that the

public interest element to the litigation is a relevant consideration in exercising its discretion,

courts in those cases have placed some significance on the fact that the expanded standing

was recognition by the Parliament that the normal procedural rules (such as undertakings for

damages), which would apply in private litigation, don’t apply. This reasoning opens the

door for defendants to argue to the contrary in cases where there is no such Parliamentary

recognition.

To avoid such arguments, in QPILCH’s view, there should be reform. There should

be statutory recognition that in public interest litigation generally (not just particular types of

131 (1978) 33 FLR 327 at 334. 132 See Ross v State Rail Authority of New South Wales (1987) 70 LGRA 91 at 98 per Cripps CJ.

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public interest litigation where there is expanded standing), a court, in determining whether a

security for costs order is made or an undertaking as to damages is required, is required to

consider, and give weight to, the fact that the litigation involves matters of public interest.

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5 Suggestions for reform

5.1 Guiding the courts’ discretion as to costs

The Governor in Council (with the consent of the rules committee133) may make rules

regarding costs in civil proceedings,134 including the entitlement to recover costs of a

proceeding and the costs of a party in a proceeding.135 One way of addressing the issue of

costs, security for costs and undertakings as to damages in public interest matters is to

legislate or regulate in respect of the considerations to be taken into account in the exercise of

discretion.

QPILCH suggests:

1 That consideration of the public interest be made mandatory in determining orders as to

costs, security for costs and undertakings as to damages.

2 If clarification of the meaning of “public interest” is necessary, then the characteristics of

public interest include:

• The “prime motivation” in bringing proceedings is the upholding of ‘the

public interest and the rule of law”;

• The views of the applicant are shared by the public generally, some class

thereof or a significant number of people;

• The case raises issues of general importance, such as where legal intervention

is required to avoid a significant and avoidable injustice; or where the matter

particularly impact upon disadvantaged or marginalised groups;

• The case is a test case, from which the defendant can benefit because it will

resolve “significant issues” as to the interpretation and future administration

of statutory provisions or other law;

• Any pecuniary interest the applicant may have in the outcome of the

proceedings is secondary to the public interest of the case.

133 Supreme Court of Queensland Act 1991 (Qld) s 118(2). The Chief Justice is required to establish a rules committee in accordance with s 118C. 134 Supreme Court of Queensland Act 1991 (Qld) s 118(1)(a). 135 Supreme Court of Queensland Act 1991 (Qld) sch 1 cl 18.

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3 That other factors to which the court must have regard in addition to be public interest be

outlined. They may include, for example:

• Whether the applicant is a non-profit association or a community activist;

• Whether the applicant has legal representation and whether that

representation has been provided pro bono;

• Whether the respondent is a government body or a corporation able to claim a

tax deduction on legal costs and fees;

• The applicant’s reasonable prospects of success;

• The applicant’s purpose in commencing litigation and the genuineness of the

proceeding;

• Whether an order as to costs is consistent with the scope, nature and object of

the legislation which authorised the litigation;

• The financial resources of the applicant and anyone standing behind the

applicant;

• Whether it is in the interests of justice to order the unsuccessful party to a

costs order;

• The conduct of the applicant (and the defendant);

• Whether the applicant can adequately represent the public interest in the

conduct of the proceedings;

• The costs of the proceedings in light of the possible benefits to be achieved;

• Whether the plaintiff is effectively in the position of a defendant;

• All the other circumstances of the case.

4 That the general discretion of the court to order the costs appropriate in the circumstances

of the case be retained, ie, the court may still order costs against an unsuccessful public

interest litigant and costs on an indemnity basis if the circumstances justify it.

In relation to point 2, whether the meaning of “public interest” should be clarified is a

difficult issue. A definition of “public interest” would provide a degree of certainty for the

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public interest litigant in respect of their potential liability for costs. On the other hand, as

noted earlier in this paper, “public interest” has proven almost impossible to define. Further,

increased certainty can instead be achieved by giving litigants access to procedures which

determine the question of costs at an early stage (see below). Accordingly, it is QPILCH’s

preliminary view that the definition of “public interest” should remain at the discretion of the

court, having regard to all the circumstances of the case.

Such legislative reform will provide Queensland courts with clear guidance as to how

their discretion should be exercised in public interest matters as well as specifically give them

licence to consider all relevant factors, including the public interest, in making costs and other

orders.

In QPILCH’s view, formal recognition that public interest litigation should be subject

to different costs considerations is unlikely to open the “floodgates” of litigation.136 Courts

will still retain their power to order costs if the circumstances of the case warrant it. Further,

litigants who repeatedly commence unmeritorious proceedings will still be subject to the

Vexatious Litigants Act 1981 (Qld).

5.2 A preliminary costs hearing

Further to the suggestion in § 5.1, and based on the Judicial Review Act 1991 (Qld)

(discussed in § 3.3 above), one possible implementation of the principles discussed above is

to have a preliminary costs hearing at the commencement of matters. At this hearing, the

judge could make an order that would be intended to survive for the whole proceeding.

Orders could cover:

• whether there would be no order as to costs in any event;

• whether the prevailing litigant (whoever that may be) will be entitled to their

costs, or a portion of their costs, in any event;

• whether there is any disentitling conduct (e.g., non-compliance with

directions causing delay and additional cost, a frivolous or vexatious

maintenance of proceedings) that would prevent the public interest litigant

from the protection of the order.

136 See Oshlack v Richmond River Shire Council (1994) 82 LGERA 236 at 245 per Stein J.

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The United Kingdom Law Commission has proposed similar measures.137

Orders made at the preliminary hearing could be revisited as necessary, taking

account of any change in circumstances. If a specific costs order has been made, the

proceeding may then be amenable to case-flow management, to ensure that parties who will

not be able to recover their costs are not disadvantaged. Although Queensland courts are not

docket judge courts (like in the Federal Court of Australia where one judge deals with the

matter from start to finish), the Supreme Court has two lists of managed cases: the

commercial list138 and the supervised cases list.139 Although there may not currently be

justification for a “public interest” list, such cases can, and should, be appropriately managed

by ad hoc directions.

5.3 Harmonising standing and costs

Another way of tackling this issue may be by targeting specific pieces of legislation

which deal with public interest issues, particularly where standing provisions allow for a wide

range of applicants; in other words, harmonising provisions on standing with provisions on

costs. This has been done under the Integrated Planning Act 1997 (Qld), where “any person”

may commence proceedings and each party bears their own costs. In contrast, the Fair

Trading Act 1989 (Qld) has an open-access provision but no corresponding costs provision.

The connection between standing and a more liberal discretion as to costs was

recognised by Kirby J in Oshlack:140

Inherent in the foregoing legislative innovation [granting “open standing” to “any person”] is a parliamentary conclusion that it is in the public interest that … individuals and groups should be able to engage the jurisdiction of the Land and Environment Court, although they have no personal, financial or like interest to do so. It can be assumed that Parliament would know that, sometimes, such applications would succeed and, sometimes, they would fail. The removal of a barrier to standing might amount to an empty gesture if the public character of an applicant’s proceedings could in no circumstances be taken into account in disposing of the costs of such proceedings, either where they succeeded or (as here) where they failed. (Footnotes omitted)

137 Administrative Law: Judicial and Statutory Appeals (1993), cited in Oshlack v Richmond River Shire Council (1994) 82 LGERA 236 at 239 per Stein J. 138 In accordance with Practice Direction No 3 of 2002. 139 In accordance with Practice Direction No 6 of 2000. 140 (1998) 193 CLR 72 at 113–114 [114].

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Speaking extra-judicially to a 1989 international conference on environmental law,

Justice Toohey of the High Court said:141

There is little point in opening the doors to the courts if litigants cannot afford to come in. … The fear, if unsuccessful, of having to pay the costs of the other side (often a government instrumentality or wealthy private corporation), with devastating consequences to the individual or environmental group bringing the action, must inhibit the taking of cases to court.

While reform in this manner may be slow and labour intensive, it is a way of intro-

ducing reforms in a controlled way, allowing review and assessment of the impact of such

reforms. It also provides an option between the 2 extremes of general reform in all matters or

no reform at all.

5.4 Other options

The following suggestions have not been explored in the body of this research paper

and are listed here for the sake of discussion.

5.4.1 Costs funding

An alternative or complement to legal reform could be the provision of costs funding

in public interest cases. As an example, the Appeal Costs Fund Act 1973 (Qld) establishes a

fund to which a party to an appeal proceedings (on a question of law) may apply if costs are

ordered against them and for which an indemnity certificate is granted by the court.

5.4.2 Liberalising the grant of the Attorney-General’s fiat

Under s 7(1)(g) of the Attorney-General Act 1999 (Qld), the Attorney-General has the

power to “grant fiats to enable entities, that would not otherwise have standing, to start

proceedings in the Attorney-General’s name” to, broadly speaking, uphold the public interest.

Under s 9A of the Attorney-General Act, an application for the Attorney-General’s fiat must

be made as prescribed by regulations. This provision is rarely used.

Potentially, this provision could be amended to enhance the opportunity for public

interest litigants to obtain the Attorney-General’s fiat, thereby providing such litigants with a

strong case that their matter is one in which costs should not be ordered, being a matter in the

public interest as sanctioned by the Attorney-General.

141 Quoted by Stein J: Oshlack v Richmond River Shire Council (1994) 82 LGERA 236 at 238.

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5.4.3 A governmental policy not to enforce costs orders

Often, public interest litigation will be against governmental bodies, including local

governments. In addition to the other suggestions in this research paper, the Government

(and its instrumentalities) could be encouraged through policy, or directed through legislation,

not to enforce costs orders in public interest litigation, even if they are awarded by the courts.

Further, a direction that a government instrumentality not appeal a costs order (as in Oshlack)

may be appropriate.142

Alternatively, instead of these decisions being made by instrumentalities themselves,

they could be made by the Attorney-General or the Governor in Council, who can objectively

weigh the competing considerations and who are directly responsible to the Queensland

public.

142 See also Hanks v Minister of Housing and Local Government [1963] 1 QB 999 at 1040, where the Minister and the council declined to seek leave to appeal Megaw J’s decision to make no order as to costs.