Perth Airport welcomes WA supreme court decision on costs

24 February, 2022

Perth Airport has welcomed the decision by the WA Supreme Court that Qantas is to pay the majority of Perth Airport’s legal costs (subject to costs in relation to four discreet issues) from the recently completed action to recover short-payment of aviation fees by the Qantas Group.

The Court confirmed that Perth Airport was the successful party.

The WA Supreme Court found that:

“In deciding who was the successful party, the most important thing is to identify the party who is to pay money to the other. That is the surest indication of success and failure.

“The plaintiff has been forced to bring proceedings in order to recover the sum awarded. It has done so, and its claim has been vindicated to that extent.

“It is wrong to equate success on issues, even important issues which took up a great deal of time, with success in a more general sense.

“Approached in that way I consider PAPL was the successful party.”

The Court went further and expressly rejected Qantas’ arguments to the contrary.

The judgment handed down by the court last week will see Qantas pay in excess of $9 million (including interest) more than it initially short paid Perth Airport from July to mid-December in 2018. This is in addition to a $2 million payment made by Qantas on the eve of the court case.

Today’s decision will mean Qantas will also have to make an additional payment to Perth Airport in respect of legal costs.

Perth Airport CEO Kevin Brown said the airport had done everything possible to avoid litigation.

“In 2018 we presented a new pricing proposal (based on a 9.7% WACC) to Qantas which represented a significant price reduction on their previous agreement,” Mr Brown said.

“The fact we were able to secure new agreements with 25 of the 26 airlines operating at Perth Airport is evidence the process was fair and reasonable.

“As an act of good faith, Perth Airport began invoicing Qantas at new reduced prices.

“Qantas unilaterally decided to short pay those invoices and did not engage reasonably in price negotiations.

“It was only after Qantas continued to pay for aeronautical services at rates that were not fair and reasonable and failed to engage reasonably in price negotiations that we commenced legal action as a last resort to protect the interests of our shareholders - who represent the retirement savings of around eight million Australian workers.

“Last week’s judgment saw the court confirm that 9.6% was a fair and reasonable WACC – a figure closely aligned with our original figure.

“We hope that today’s decision allows us to move forward and see the recommencement of discussions to secure an agreement for the period since December 2018.

“As always, Perth Airport will enter these negotiations with good faith and a genuine commitment to secure a mutually agreeable outcome, not only to avoid further costly legal action but to work constructively with Qantas to grow both our businesses.

“We remain committed to working with all of our airline partners on the challenge of quickly rebuilding Western Australia’s connections to the world.”

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