On 23 December 2016, in Trustee for The MTGI Trust v Johnston (No 2) [2016] FCAFC 190 the Full Federal Court (Siopsis, Collier and Katzmann JJ) made an order for costs in favour of a client for whom I appeared as advocate.

The order is rather spectacular for a number of reasons.

First, it was made in what is normally a “no-costs” jurisdiction, on the basis that the proceedings were commenced by the applicant without reasonable cause within the meaning of s.570(2)(a) of the Fair Work Act: [12]-[15].

Secondly, it was made jointly and severally against a party to the proceedings (the applicant before the Full Court), and a non-party director of that party, applying principles from Mason CJ and Deane J in Knight v FP Special Assets Ltd (1992) 174 CLR 178, and more recently French CJ, Kiefel, Bell and Keane JJ in Selig v Wealthsure Pty Ltd [2015] HCA 18 at [43]: [27]-[34].

Thirdly, it was made on an indemnity basis (see [16]) in a fixed sum ($48,387.18), rather for an amount to be fixed by assessment or taxation: [35]-[36]. That in part flowed from a failure by the applicant to accept a Calderbank offer: [19]-[24].

As I have noted in earlier articles, it appears that Courts are becoming more willing to make lump sum costs orders. As the Full Court observed at [36]:

“Paragraph 4 of the Costs Practice Note (GPN-COSTS) issued by the Chief Justice on 25 October 2016 refers to the preference of the Court, wherever it is practicable and appropriate to do so, to make a lump-sum costs order. In our view this case is one where it is both practicable and appropriate to do so.”