Abdirahman v Assetlink Link Services (17) Pty Limited (No 3)
[2021] FCCA 1097
•24 May 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Abdirahman v Assetlink Link Services (17) Pty Limited (No 3) [2021] FCCA 1097
File number(s): MLG 3521 of 2020 Judgment of: JUDGE RILEY Date of judgment: 24 May 2021 Catchwords: INDUSTRIAL LAW – costs – application for preliminary discovery dismissed – whether costs follow the event – whether s.570 of the Fair Work Act 2009 applies Legislation: Fair Work Act 2009 (Cth) ss 535, 536, 570
Federal Circuit Court of Australia Act 1999 (Cth) s 79
Fair Work Regulations 2009 (Cth) div 3 Pt 3-6
Federal Circuit Court Rules 2001 (Cth) r 21.02
Cases cited: Abdirahman and Ors v Assetlink Link Services (17) Pty Limited [2021] FCCA 90
Abdirahman & Ors v Assetlink Link Services (17) Pty Limited (No 2) [2021] FCCA 477
Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd) v Lane Industries Pty Ltd (1993) 26 IPR 261
Hughes v Western Australian Cricket Association (Inc) (1986) 8 ATPR 40-748
Ruddock v Vadarlis [2001] FCA 1865; 115 FCR 229
Number of paragraphs: 31 Date of last submission: 22 April 2021 (decided on the papers) Place: Melbourne Advocate for the Prospective Applicants
Solicitor for the Prospective Applicants:
Trent Hancock
Jewell Hancock Employment Lawyers
Counsel for the Prospective Respondent: Andrew Denton Solicitor for the Prospective Respondent: Mark Diamond & Associates ORDERS
MLG 3521 of 2020 BETWEEN: MOHAMED ABDIRAHMAN
First Prospective Applicant
ALI AL SHAHER
Second Prospective Applicant
MOHAMED ALI (and others named in the Schedule)
Third Prospective Applicant
AND: ASSETLINK LINK SERVICES (17) PTY LIMITED
(ACN 126 171 079)Prospective Respondent
ORDER MADE BY:
JUDGE RILEY
DATE OF ORDER:
24 MAY 2021
THE COURT ORDERS THAT:
1.The prospective respondent’s application for costs filed on 9 April 2021 be dismissed.
REASONS FOR JUDGMENT
JUDGE RILEY:
INTRODUCTION
This is an application for costs in relation to an application for preliminary discovery in the context of allegations of underpayment of wages. The prospective applicants were all employed by the prospective respondent as security guards.
The prospective respondent argued that this court has no power to order preliminary discovery. That question was dealt with as a threshold issue. The prospective applicants were successful on the threshold issue: Abdirahman and Ors v Assetlink Link Services (17) Pty Limited [2021] FCCA 90. However, the prospective applicants were unsuccessful on the substantive question of whether preliminary discovery should be ordered in the particular circumstances of this case: Abdirahman & Ors v Assetlink Link Services (17) Pty Limited (No 2) [2021] FCCA 477.
The prospective respondent sought costs on scale of the threshold issue and the substantive question. The parties agreed that the question of costs should be determined on the basis of their written submissions and without an oral hearing.
MATERIAL RELIED UPON
The prospective applicants relied upon their written submissions filed on 23 April 2021.
The prospective respondent relied upon:
(a)its application in a case filed on 9 April 2021; and
(b)its written submissions filed on 9 April 2021.
THE PROSPECTIVE RESPONDENT'S PROPOSED COSTS ORDERS
The costs orders proposed by the prospective respondent in their application in a case filed on 9 April 2021 are as follows:
1.On application being made pursuant to rule 21.02(1)(b) of the Federal Circuit Court Rules 2011 (Cth), the prospective applicants pay the prospective respondent’s costs of the application filed on 28 September 2020 fixed at $11,037.50 pursuant to Schedule 1 of the Rules as follows:
(a)$3,547 calculated as: $1,867 in respect of item 3(a) of the Schedule, $1,120 in respect of item 3(b) of the Schedule, and $560 in respect of item 12 of the Schedule;
(b) $6,728 in respect of item 6 of the Schedule;
(c)$762.50 calculated as: $305 in respect of item 9(a) of the Schedule, $305 in respect of item 9(b) of the Schedule, $152.50 in respect of item 12 of the Schedule.
THE PROSPECTIVE APPLICANTS’ PROPOSED COSTS ORDERS
The prospective applicants proposed that the prospective respondent’s costs application be dismissed, or alternatively, that the prospective respondent’s costs be reduced to nil.
LEGISLATION
Section 79 of the Federal Circuit Court of Australia Act 1999 provides that:
(1)This section does not apply to family law or child support proceedings or proceedings in relation to a matter arising under the Fair Work Act 2009 or section 14, 15 or 16 of the Public Interest Disclosure Act 2013.
(2)The Federal Circuit Court of Australia or a Judge has jurisdiction to award costs in all proceedings before the Federal Circuit Court of Australia (including proceedings dismissed for want of jurisdiction) other than proceedings in respect of which any other Act provides that costs must not be awarded.
(3)Except as provided by the Rules of Court or any other Act, the award of costs is in the discretion of the Federal Circuit Court of Australia or Judge.
Rule 21.02 of the Federal Circuit Court Rules 2001 provides that:
(1) An application for an order for costs may be made:
(a) at any stage in a proceeding; or
(b) within 28 days after a final decree or order is made; or
(c) within any further time allowed by the Court.
(2) In making an order for costs in a proceeding, the Court may:
(a) set the amount of the costs; or
(b) set the method by which the costs are to be calculated; or
(c)refer the costs for taxation under Part 40 of the Federal Court Rules or under Chapter 19 of the Family Law Rules; or
(d)set a time for payment of the costs, which may be before the proceeding is concluded.
Section 570 of the Fair Work Act 2009 (“the Act”) provides that:
(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A.
(2) The party may be ordered to pay the costs only if:
(a)the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or
(b)the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs; or
(c) the court is satisfied of both of the following:
(i)the party unreasonably refused to participate in a matter before the FWC;
(ii) the matter arose from the same facts as the proceedings.
THE THRESHOLD ISSUE
The prospective respondent argued that:
11.The usual position is that costs are not determined on an issue-by-issue basis.2 It is only in the exceptional category of case where such an approach may be appropriate.3
:Ehrke v Australian Building and Construction Commissioner (No 2) [2020] FCA 754 (Rangiah J) at [10].
:Ruddock v Vadarlis [2001] FCA 1865; 115 FCR 229 (Black CJ, French J) at [15]; Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd) v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272.
In Ruddock v Vardalis [2001] FCA 1865; 115 FCR 229, notwithstanding the usual position, Black CJ and French J (as his Honour then was) said at [15] that:
… Costs may be apportioned according to success or failure on particular distinct or severable issues …
In my view, the threshold issue was severable, as demonstrated by the fact that it was dealt with at a separate hearing, and was the subject of a separate judgment.
In Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd) v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272, Gummow, French and Hill JJ said at 271 to 272:
The question of costs
Pursuant to s 43(2) of the Federal Court of Australia Act, the court has a general discretion to award costs. Considerations relevant to the exercise of that discretion were enunciated by Toohey J in Hughes v Western Australian Cricket Association (Inc) (1986) 8 ATPR 40-748 at 48,136:
1.Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order ...
2.Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which it has failed
3.A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law ...
The propositions enunciated in that case are subject to the further consideration that justice may not be served if parties are dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case: Cretazzo v Lombardi (1975) 13 SASR 4 at 12. In Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 3) (1979) 42 FLR 213; 28 ALR 201, Fisher J regarded the discretion to apportion costs as one to be exercised only in the most exceptional circumstances. Nevertheless he accepted that where a considerable part of the trial is taken up in determining issues upon which a party fails, it is a proper exercise of the discretion to reduce the costs allowed to that party. Generally speaking, and notwithstanding the considerations referred to by Toohey J and the other authorities mentioned above, the demands of the community for greater economy and efficiency in the conduct of litigation may properly be reflected in a qualification of the presumption that a successful party is entitled to all its costs. In Commissioner of Australian Federal Police v Razzi (No 2) (1991) 101 ALR 425 at 430, Wilcox J, after referring to the importance of the general principle enunciated by Toohey J, said:
But I do not think that courts should be reluctant to recognise the existence of exceptional cases. In these days of extensive court delays and high legal costs the courts should use all proper means to encourage parties to consider carefully what matters they will put in issue in their litigation. If parties come to realise that they will not necessarily recover the whole of their costs, even though they have unsuccessfully raised a discrete issue, they are likely better to consider whether the raising of that issue is a justifiable course to take.
Where there is a mixed outcome in proceedings, the question of apportionment is very much a matter of discretion for the trial judge. Mathematical precision is illusory and the exercise of the discretion will often depend upon matters of impression and evaluation. …
As can be seen, the prospective respondent has somewhat misrepresented the effect of Dodds. Specifically, the Full Court adopted Toohey J’s dicta in Hughes v Western Australian Cricket Association (Inc) (1986) 8 ATPR 40-748 that:
… I do not think that courts should be reluctant to recognise the existence of exceptional cases.
All in all, I consider that, in the present case, it would be entirely inappropriate for the prospective respondent to get its costs of the threshold issue. The prospective respondent raised that discrete issue, and was wholly unsuccessful in relation to it. The threshold issue was strenuously pressed by the prospective respondent, and it occupied a separate half day of hearing and a substantial portion of the parties’ written and oral submissions. My conclusion on the threshold issue is independent of, and additional to, the other matters dealt with in these reasons.
SECTION 570 OF THE FAIR WORK ACT 2009
The prospective respondent argued that s.570 of the Act did not apply in the present case on the following basis:
6.The contemplated proceeding was described as a claim for underpayment of wages. No “matter” under the Fair Work Act 2009 (Cth) (FW Act) was raised in the application. Indeed, the only reference the prospective applicants made to the FW Act was at [20] of their submissions where it was submitted that, due to obligations imposed by the FW Act, it was likely that the prospective respondent had certain records in its possession. The only reference to the FW Act in the supporting affidavit is at [20] and is referred to for the same purpose.
7.That being the case, no “matter” under the FW Act was raised in the application, the submissions, or the affidavit. Further, no “matter” under the FW Act is referred to in either judgment that came from this application.
The prospective applicants submitted that the application for preliminary discovery was a precursor to prospective proceedings in relation to a matter arising under the Act, and thus fell within the scope of s.570 of the Act.
Subsection 570(1) of the Act begins with the words:
A party to proceedings … in relation to a matter arising under this Act …
As found in the earlier judgments in this matter, the application for preliminary discovery was a proceeding.
The words “in relation to” are words of very wide import. As found in the earlier judgments, the intention in relation to the application for preliminary discovery was to help the prospective applicants decide whether to bring an application under the Act. That is sufficient to make the application for preliminary discovery a proceeding in relation to a matter arising under the Act.
While the initial application did not refer to any specific provision of the Act, it was filed in the Fair Work division of this court. Ultimately, the prospective applicants sought preliminary discovery of various employment records of each prospective applicant for the entire period of his employment, including:
(a)each prospective applicant’s contract of employment;
(b)the position description for each prospective applicant;
(c)each prospective applicant’s payslips and financial year pay summaries;
(d)documents for each prospective applicant which provide a record of hours worked, stating the start and finish time of each shift;
(e)Security Register Book copies as they relate to the prospective applicants’ record of hours worked;
(f)Crowd Control Register as they relate to the prospective applicants’ record of hours worked;
(g)deeds of release and settlement offers; and
(h)all wage queries submitted by each prospective applicant.
The affidavit filed in support of the application for preliminary discovery explained that the prospective applicants instructed that they had been underpaid in relation to hours worked, overtime pay, annual leave, award classification, superannuation and other entitlements.
Moreover, the prospective applicants sought employment records that the prospective respondent was required to retain under s.535 and s.536 of the Act, and Division 3 Part 3-6 of the Fair Work Regulations 2009.
To my mind, there can be no doubt the application for preliminary discovery was a proceeding in relation to a matter arising under the Act.
It follows that s.570(2) of the Act applies. The prospective respondent did not submit that any particular aspect of s.570(2) was satisfied in this case. That is, the prospective respondent did not submit that:
(a)the proceeding was issued vexatiously or without reasonable cause;
(b)the prospective applicants’ unreasonable act or omission caused the other party to incur the costs; or
(c)the court could be satisfied that the prospective applicants unreasonably refused to participate in a matter before the Fair Work Commission.
I do not consider that any particular aspect of s.570(2) of the Act was satisfied in this case. The prospective applicants were successful on the threshold issue and unsuccessful on the substantive issue. However, their conduct was within the normal range. It does not warrant a costs order.
THE PROSPECTIVE APPLICANTS’ CLAIM FOR COSTS
The prospective respondent submitted that:
8.Finally, it is noteworthy that all of the parties conducted themselves on the basis that the usual order as to costs would apply – this is evident from the final relief in the application including an order that the prospective respondent pay their [costs]“of, and incidental to, this application”, and their submissions concluded at [25] that “Should the court grant the application, costs should also follow the event and an order for costs should be made in favour of the prospective applicants.” On the part of the prospective respondent, it submitted at [45] of its written submissions dated 9 December 2020 that “the application should be dismissed with costs.”
9.In the circumstances, … s 79(1) of the FCCA Act [is not] engaged and the usual order as to costs should be followed.
The prospective applicants argued that the application for costs was an error on the part of their former solicitor, and they should not be prejudiced by their former solicitor’s misapprehension.
It seems to me that the parties’ preliminary positions on costs should not be determinative of the issue, or even influential. Section 570 of the Act applies, and, in the circumstances of this case, precludes a costs order being made against the prospective applicants.
CONCLUSION
The application for costs will be dismissed.
I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Riley. Associate:
Dated: 24 May 2021
SCHEDULE OF PARTIES
MLG 3521 of 2020 Applicants
Fourth Prospective Applicant:
IMRAN ASHKAR
Fifth Prospective Applicant:
SADIK DEMIRAL
Sixth Prospective Applicant:
PHOOLA SINGH DHILLON
Seventh Prospective Applicant:
AHMED OSMAN
Eighth Prospective Applicant:
HASAN REKABI
Ninth Prospective Applicant:
MOHAMED SHARIF
Tenth Prospective Applicant:
EMMANUEL ZERVAS
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