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Setting aside costs orders: Does UCPR r 36.16(3) give the court power to set aside a costs order which has been entered?

UCPR r 36.16 (3)is reiterated below:

(3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it:

(a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or

(b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief.

 

No power to set aside costs orders

In Habib v Nationwide News Pty Ltd (No 2) [2010] NSWCA 291 at [34]-[35], the Court of Appeal indicated that Rule 36.16(3) does not give the court power to set aside a costs order which has been entered by applying the reasoning that costs orders fall within the exception indicated in r36.16(3)(a) because “costs orders determined claims for relief, the relief claimed being orders disposing of the costs of the trial and of the appeals”.

Whilst there have been a few judgments of the contrary view, arguing that a claim for costs was not a “claim for relief” within the meaning of UCPR 36.16(3): Saul v Lin [2007] NSWSC 782, Vaughan v Hoskovich (No 2) [2010] NSWSC 835;Crawley v Short [2009] NSWCA 410, these cases did not consider whether a claim for costs seeks determination on “any question (whether of fact or law or both) arising on any claim for relief”: UCPR 36.16(3)(a).

Palmer is binding

Hodgson JA in Griffith v Australian Broadcasting Corporation (No 2) [2011] NSWCA 145 at [10] reiterated his tentative view as follows:

It was submitted for the respondents that r 36.16(3) does not apply: Roads and Traffic Authority of NSW v Palmer (No 2) [2005] NSWCA 140 at [20]- [21]; Habib v Nationwide News Pty Limited (No 2) [2010] NSWCA 291 at [35]. I remain of the tentative view expressed in the latter case that Palmer is binding on the Court, and prevails over the contrary obiter in Hancock v Arnold (No 2) [2009] NSWCA 19 at [10], and so would accept the respondents’ submission on this point.

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