On the interpretation of ‘exceptional circumstances’ provisions re costs

Di Lorenzo v The Magistrates’ Court of Victoria [2021] VSC 475 was a case in which the Supreme Court spent 2 hearing days on a judicial review of a costs order worth $5,000.  One paragraph of it piqued my interest, about the interpretation of provisions which say there should be no order for costs of the proceeding, absent special or extraordinary circumstances.  Horrible members of that species of provisions are to be found inside s. 303 of the Legal Profession Uniform Law.

Some people at Moreland Council sought intervention orders, through their lawyer.  The defendant retaliated by seeking an intervention order against the lawyer and another person at Moreland Council.  He was unrepresented.  

The plaintiffs’ counsel developed flu-like symptoms and they applied for an adjournment lest it be COVID-19.  The Magistrate granted the adjournment and awarded the defendant $5,000 in costs.  This was an error for many reasons, Justice Gorton found.  

First, as an unrepresented litigant, the defendant had no costs.  

Secondly, s. 111 of the Personal Safety Intervention Orders Act 2010 provided for parties to bear their own costs ‘unless exceptional circumstances warrant otherwise in a particular case’, and the Magistrate failed to consider whether there were exceptional circumstances.

Thirdly, her Honour made the order against a person who was not actually a party to the proceedings in question without invoking the law in relation to non-party costs orders (an error which was rectified between days 1 and 2 of the Supreme Court hearing).  

(And fourthly, though this was not discussed in this case, I would  observe that where a matter goes off by virtue of an ‘act of God’, consideration should be given to whether a costs order is appropriate at all: see, e.g. Earp Woodcock Beveridge & Co Ltd v Gordon (1927) 44 WN (NSW) 123.) 

What interests me about the judgment, however, is the discussion of whether such a costs provision ought to be interpreted to refer to the usual and reasonable costs of the case itself, such that costs of an adjournment might stand outside the provision, or all the costs incurred in the proceeding.  Though his Honour found that on the wording of this provision, it referred to all the costs of the proceeding, he allowed that a different provision might be interpreted such that some costs might stand outside the provision:

‘[33] The issue is whether costs thrown away by reason of an adjournment are costs ‘of the proceeding’ as that phrase is used in s 111(1) of the Act. It is certainly arguable that they are not, in the sense that costs ‘thrown away’ may be seen as additional, or duplicated, costs that sit outside the costs ‘of the proceeding’. The distinction is exemplified by the fact that if costs are wasted because of an adjournment, a Court will typically have the option of either ordering that those costs be paid, or of ordering that those costs be costs ‘in the proceeding’. And there is an identifiable public policy purpose for which the legislature might have intended to include this distinction when it enacted s 111 of the Act, because it would create a situation where each party would bear their own essential costs of bringing or defending a proceeding, but would be liable in the event that they caused unnecessary or additional costs to be incurred by the other party.’

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