“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) v Australian Paper Pty Ltd

[2010] FWA 7514

[2010] FWA 7514

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.739—Dispute resolution

“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
v
Australian Paper Pty Ltd
(C2010/392)

Timber and paper products industry
COMMISSIONER BLAIR	MELBOURNE, 27 SEPTEMBER 2010

Alleged dispute in relation to the Respondent’s engagement of contractors and remunerative parity.

[1] This decision arises out of an application under s.739 of the Fair Work Act 2009 (the Act) by the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (the Applicant). Australian Paper Pty Ltd (Maryvale Mill) (the Respondent) is the Respondent.

[2] The issue in this decision, arising out of the original application lodged in Fair Work Australia (the Tribunal) on 29 June 2010, is in relation to an application for costs under s.611 of the Act.

[3] This matter was lodged in the Tribunal on 29 June 2010. The matter in dispute under s.739 of the Act is in relation to the Respondent’s engagement of contractors and remunerative parity.

[4] The matter was initially set down for conciliation on 12 July 2010 but was then cancelled and rescheduled to 19 July 2010. It was subsequently cancelled and a conference finally took place on 22 July 2010.

[5] The matter could not be settled and was therefore set down for arbitration on 16 and 17 September 2010 in Traralgon. Inspections occurred on 23 August 2010 at the Maryvale site in Gippsland.

[6] At approximately 5.15pm on the evening of 15 September 2010 Ms McGrath, on behalf of the Applicant in the original matter emailed the chambers of the Tribunal as currently constituted with words to the effect, “please be advised that the AMWU has decided not to pursue its case against Australian Paper tomorrow in Traralgon”.

[7] Given that the email was sent at approximately 5.15pm, beyond the close of business hours of the Tribunal one might consider that the email was sent the next business day, that is 16 September 2010.

[8] As it turned out the Tribunal as currently constituted, was in transit (on a plane) between Brisbane and Melbourne and did not get a voice message in similar terms that was left on the Associate’s mobile phone at approximately 5.20pm, until after 7.30pm on 15 September 2010.

[9] Due to the vagueness of the email and voicemail message, the Tribunal was unclear as to whether or not the matter had been discontinued or whether the Applicant were simply not intending to attend the hearing which was set down for 16 and 17 September 2010 in Traralgon.

[10] On 16 September 2010 the Tribunal, as well as the Respondent and their legal representatives, attended the hearing in Traralgon. Because of the vagueness of the original email neither the Tribunal nor the Respondent were clear about whether or not the matter had been discontinued.

[11] In a subsequent phone conversation with the Applicant, the Tribunal sough clarification as to whether in fact the matter was to be discontinued. Ms McGrath was unable, initially, to provide such clarity; however, in a further telephone conversation recorded on transcript the Tribunal was advised that the matter was to be discontinued. A Notice of Discontinuance was subsequently sent to the Tribunal.

[12] The matter the Tribunal now has to deal with is an application for costs by Australian Paper Pty Ltd under s.611(2) of the Act. Section 611(2) states:

“611(2) [Exception] However, FWA may order a person (the first person) to bear some or all ofthe costs of another person in relation to an application to FWA if:

(a) FWA is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) FWA is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.”

[13] The Respondent states that because the matter had been discontinued at such late notice, they had been put to significant time and legal costs in responding to the application.

[14] The Respondent submits that the Applicant’s conduct creates the exceptional circumstance required by Fair Work Australia to be empowered to order costs against the Applicant and it should exercise that discretion on the basis the application was made vexatiously.

[15] The Respondent further states that the only legitimate purpose for making an application under s.739 of the Act is to resolve a dispute. The Applicant does not concede that the dispute has been resolved between the parties and the application was not discontinued as a result of any settlement between the parties.

[16] The Respondent submits that, in the circumstance where the application had been discontinued in the absence of any resolution of the dispute, then the only conclusion which the Tribunal can reach is that the Application was made for an ulterior purpose. As a result the Respondent submits that they have been put to unnecessary legal cost and inconvenience, including travel and accommodation costs for the purposes of attendance at the hearing.

[17] The submissions from the Applicant in response to the application for order for costs states that the explanatory memorandum at s.611 of the Act directs that the presumption against parties bearing their own costs will only apply in “certain limited circumstances”. These circumstances are where Fair Work Australia is satisfied that an application was made “vexatiously or without reasonable clause” or in cases where it should have been reasonably apparent that an application had “no reasonable prospect of success”.

[18] The Applicant submits that in respect of this application under s.611 of the Act, the conduct complained of by the Respondent is the withdrawal of an application not the making or instituting of one. They submit that whilst the Respondent may feel aggrieved by the circumstances of that withdrawal, such a grievance is simply not one which may be satisfied by the making of an order under s.611 of the Act.

[19] The Applicant states that the Respondent’s attempts to infer an ulterior purpose in the making of the application under s.739 of the Act because the matter was discontinued without “any resolution of the dispute”, that such an argument both strains credibility and fails to satisfy the requirements of an application under s.611(2)(a).

[20] The Applicant states that the predominant and sole purpose of the Union in instituting the application under s.739 of the Act was to stop Australian Paper permitting contract labourers on site in circumstances where the Union believed Australian Paper was acting in breach of the enterprise bargaining agreement. The Applicant states that the issue had been the subject of much discussion at site level for several months.

[21] The Applicant states that reason for the withdrawal of the application and the notice of discontinuance was that the Union and its members employed at Australian Paper met on 15 September 2010 to discuss the merits of the Union’s case, in light of the submissions which had been filed in the matter by Australian Paper. The resolution of the meeting was a view that whilst the Union had a strong case, a possibility existed that the Union’s case would not be upheld as to the manner in which the “contractor’s clause” in the relevant collective agreement should operate. At this time, the Union, on behalf of its members, therefore made the decision to withdraw its application under s.739 of the Act.

[22] The Applicant states that the motive for the withdrawal of the application was the decision that, in light of the submissions that had been exchanged, and the circumstances of the inspections which had been undertaken in this matter, proceeding to the arbitration of the dispute was too great a risk for the Union to take on behalf of its members.

[23] The Applicant, in their submissions, then goes on to explain the process in which the Applicant’s representative, Mr Steve Dodd, made contact with Mr Wayne Reichelt, from the Respondent, and explained the circumstances of why the Union were withdrawing such an application.

[24] In conclusion, the Applicant submits that the application for costs by the Respondent goes to the issue of unnecessary legal costs and inconvenience. The Applicant notes, however, that such costs cannot be visited upon the respondent to the costs application under s.611(2)(a) of the Act. They submit that there was no vexatiousness in the making of any relevant application, as has been alleged. There does appear to be a situation of confusion in the communications between the parties and the Tribunal over 15 and 16 September 210.

Conclusion

[25] Having considered the submissions of the parties, the Tribunal does note that there was significant confusion between the Respondent in the original application and the Tribunal as to the message received from the Applicant in the original application, in the evening of 15 September 2010.

[26] There may be criticism of the Applicant in the original application about the tardiness in which the notification was sent, advising that they did not wish to proceed with the matter against Australian Paper in Traralgon. One might be critical of the Applicant in waiting until 15 September 2010 before conferring with their members as to whether or not they wish to proceed with the application under s.739 of the Act.

[27] However, being critical of the conduct of one party relating to their tardiness does not necessarily say that the original application under s.739 of the Act was vexatious or without reasonable cause or that it would have been reasonably apparent that the application had no reasonable prospect of success. It is not unusual in this jurisdiction, or in fact other jurisdictions, for a matter to be withdrawn at the last minute based on the original applicant reviewing the evidence and submissions of the respondent, that although their case may have some chance of success in the overall circumstances it may not be worthwhile pursing the claim to the fullest extent.

[28] Having been satisfied that the claim was not made vexatiously or that the claim had no reasonable prospect of success the Tribunal would dismiss the application for costs.

COMMISSIONER

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