Regulatory and environment insights role of costs in sentencing

Issued: 21 December 2021

To punish or to compensate: the role of costs in sentencing

(SafeWork NSW v Williams Timber P/L; & Easy Fall Guttering P/L [2021] NSWCCA 233)

Key points 

  • The purpose of costs orders in sentencing is to compensate the prosecutor, not to penalise the defendant.

  • Where a prosecutor seeks costs and the Court is considering declining to make an order, the prosecutor must be given an opportunity to be heard on the application.

  • Where a defendant's capacity to pay is in issue, the Court should reduce the quantum of any fine imposed, rather than reduce the amount of costs awarded to the prosecutor.

Background

Williams Timber Pty Ltd and Easy Fall Guttering Pty Ltd (the respondents) were each prosecuted by SafeWork NSW (the prosecutor) in separate proceedings for offences under the Work Health and Safety Act 2011.

The respondents both pleaded guilty and in each case the prosecutor made an application for professional costs as agreed or assessed. The respondents were either silent or did not oppose the order and quantum sought by the prosecutor (being $22,000 and $42,000 respectively).

At the sentencing hearings in the District Court, both respondents raised their lack of means to pay a fine. Each company was convicted and fined, however in both cases the sentencing judge declined to award costs to the prosecutor based on the respondents’ limited means.

The appeal

The prosecutor appealed the decisions to the Court of Criminal Appeal (CCA) on the grounds that:

  • there was a denial of procedural fairness as the prosecutor was not given an opportunity to be heard on the question of costs

  • the sentencing judge misapprehended the function and purpose of costs in the sentencing exercise, by treating it as a form of punishment.

The appeals were heard and determined jointly. 

Denial of proecedural fairness

The CCA found that the prosecutor had been denied procedural fairness as the opportunity had not been given to adduce evidence as to the nature and extent of the costs incurred and to make submissions in support of the application. 

The prosecutor had not been put on notice in either case of the Court’s intention to decline to make a costs order, therefore absent the respondents’ opposition to the orders sought, it was reasonable to expect the orders would be made (at [30] and [32]). 

The purpose and function of costs orders

The CCA reaffirmed the long-standing principle set out by the High Court in Latoudis v Casey (1990) 170 CLR 534 at 543, that costs orders are compensatory and not punitive in nature; and are intended to indemnify the successful party against the expense of the proceedings.

The CCA further held that ss. 4 and 6 of the Fines Act 1996 require a court to have regard to a defendant's means when imposing a fine and costs. However, if capacity to pay is an issue, 'the correct approach is to reduce the fine to be paid by the offender, rather than to reduce the amount awarded as costs in favour of the prosecutor' (at [41]). Accordingly, the CCA found the approach taken by the sentencing judge, refusing to award costs in order to ameliorate the respondents' penalties, was erroneous. Instead the fines should have been reduced.

Despite finding error, the CCA refused to intervene due to timing of the appeals, the respondents' means, and because the fines were not the subject of challenge. The CCA held it would be unfair to award costs against the respondents in circumstances where there would be no reduction of the fines.

Implications for prosecutors

To ensure a court does not fall into error when imposing fines and ordering costs against a defendant who raises capacity to pay as an issue, the prosecutor should submit that the correct approach is to reduce the quantum of any fine rather than reduce the award of costs.

Prosecutors should adopt a reasonable and practical approach when seeking costs, as a court can consider reducing any fine if means to pay is in issue.

Contacts

Johanna Geddes, A/Director
johanna.geddes@cso.nsw.gov.au
02 9497 9251

Gillian Buchan, A/Principal Solicitor
gillian.buchan@cso.nsw.gov.au
02 9474 9294

Paris Donnelly, Senior Solicitor
paris.donnelly@cso.nsw.gov.au
02 9497 9220

Last updated:

16 Nov 2022

We will use your rating to help improve the site.
This field is required
Please don't include personal or financial information here
This field is required
Please don't include personal or financial information here

We acknowledge Aboriginal people as the First Nations Peoples of NSW and pay our respects to Elders past, present, and future. 

Informed by lessons of the past, Department of Communities and Justice is improving how we work with Aboriginal people and communities. We listen and learn from the knowledge, strength and resilience of Stolen Generations Survivors, Aboriginal Elders and Aboriginal communities.

You can access our apology to the Stolen Generations.

Top Return to top of page Top