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Supreme Court 2 November 2006

Healey v Commissioner of Taxation

[2006] NSWSC 1148

Public order & justice offences
CRIMINAL LAW COSTS OF APPEAL ERROR IN LAW EACH PARTY TO PAY OWN COSTS

Citation: Healey v Commissioner of Taxation [2006] NSWSC 1148
Court: Supreme Court of New South Wales
Date: 2 November 2006
Judge(s): Rothman J

Background

This judgment is the costs decision following an earlier Supreme Court appeal (Healey v Commissioner of Taxation [2006] NSWSC 853). The appellant had successfully challenged a Magistrate's decision in the Local Court, where the Commissioner of Taxation had sought to amend a prosecution document to correct a misspelling of the appellant's name.

The Magistrate had allowed the amendment under a provision of the Crimes Act 1914 (Cth). The appeal succeeded not on the grounds the appellant had argued, but because Rothman J found the Magistrate had erred in law by taking too narrow a view of the matters available to him in exercising his discretion. The matter was quashed and remitted to the Local Court for reconsideration.

After the appeal was decided, the parties filed written submissions on who should bear the costs of the Supreme Court proceedings. The underlying Local Court prosecution had not yet reached a final outcome.

  • Whether the Supreme Court had jurisdiction to award costs against the Commonwealth respondent, given the High Court's decision in Solomons v District Court of NSW (2002) 211 CLR 119 regarding the Costs in Criminal Cases Act 1967 (NSW)
  • Whether costs of a criminal appeal under the Crimes (Local Courts Appeal and Review) Act 2001 are governed by the same framework as costs on trial and acquittal
  • Whether costs should follow the event where the appellant succeeded on a ground not raised in the court below or on appeal

Decision

Rothman J identified two distinct bases on which the respondent opposed costs: a jurisdictional argument and a discretionary argument. The jurisdictional argument relied on Solomons, where the High Court held that the Judiciary Act 1903 (Cth) does not make the Costs in Criminal Cases Act 1967 (NSW) applicable to a trial and acquittal in a state court on a Commonwealth indictment. His Honour noted, however, that the present case involved neither a trial on indictment nor an acquittal, and that the costs of this appeal were governed by different statutory provisions, namely section 98 of the Civil Procedure Act 2005 (NSW) and section 70 of the Crimes (Local Courts Appeal and Review) Act 2001.

His Honour found it unnecessary to resolve the jurisdictional question, because the discretionary argument was determinative. The appeal had succeeded on a ground that neither party had raised at first instance or on appeal. While the appellant prevailed overall, the Magistrate remained free on remittal to reach the same outcome once the correct discretionary factors were considered.

Rothman J exercised his discretion to depart from the usual rule that costs follow the event, noting that this approach is available in appropriate circumstances and is supported by the authorities in Whitehouse Properties Pty Ltd v Bond Brewing (NSW) Ltd (1992) 28 NSWLR 17 and Wickstead v Browne (1992) 30 NSWLR 1. Given the circumstances, each party was ordered to bear its own costs.

Orders Made

  • Each party is to pay its or his own costs of and incidental to the proceedings, including the costs associated with the dispute on costs.
  • Otherwise, the proceedings are dismissed.

Key Takeaways

  • Costs of a criminal appeal under the Crimes (Local Courts Appeal and Review) Act 2001 are not necessarily governed by the Costs in Criminal Cases Act 1967 (NSW); the Civil Procedure Act 2005 and the appeal statute itself provide the applicable framework in such proceedings.
  • The High Court's decision in Solomons v District Court of NSW, which concerns costs on trial and acquittal for Commonwealth offences, does not automatically extend to costs orders on appellate proceedings where no trial or acquittal has occurred.
  • Success on appeal does not guarantee a costs order in favour of the successful party; where the appeal is won on a ground not argued by either party, the court retains a broad discretion to depart from the costs-follow-the-event principle.
  • Where the remitted matter may still result in the same outcome at first instance, this is a relevant factor in the exercise of the costs discretion.
  • The Supreme Court left the jurisdictional question about awarding costs against the Commonwealth in this context unresolved, treating it as unnecessary to decide once the discretionary analysis was complete.

Legislation and Cases Referenced

Legislation:
- Judiciary Act 1903 (Cth)
- Crimes Act 1914 (Cth)
- Costs in Criminal Cases Act 1967 (NSW)
- Crimes (Local Courts Appeal and Review) Act 2001 (NSW)
- Civil Procedure Act 2005 (NSW)
- Supreme Court Act 1970 (NSW)

Cases:
- Healey v Commissioner of Taxation [2006] NSWSC 853
- Solomons v District Court of NSW (2002) 211 CLR 119
- Whitehouse Properties Pty Ltd v Bond Brewing (NSW) Ltd (1992) 28 NSWLR 17
- Wickstead v Browne (1992) 30 NSWLR 1