Borg v Commissioner, Department of Corrective Services & Anor

[2003] NSWADT 35

CITATION:	Borg v Commissioner, Department of Corrective Services & Anor [2003] NSWADT 35
DIVISION:	Equal Opportunity Division
PARTIES:	APPLICANT Josephine Borg FIRST RESPONDENT Commissioner, Department of Corrective Services SECOND RESPONDENT Peter Wheeler-Smith
FILE NUMBER:	001008
HEARING DATES:	Decision on the papers
SUBMISSIONS CLOSED:	10/16/2002
DATE OF DECISION:	02/28/2003
BEFORE:	Goode P - Judicial Member; Nemeth de Bikal L - Member; Farmer L - Member
APPLICATION:	Costs
MATTER FOR DECISION:	Costs
LEGISLATION CITED:	Anti-Discrimination Act 1977 Public Sector Management Act 1988
CASES CITED:	Borg v Commissioner, Department of Corrective Services & Anor [2002] NSWADT 42 Borg v Commissioner, Department of Corrective Services [2000] NSWADT 118 Cleary Bros (Bombo) Pty Ltd v Cvetkovski (EOD) [2001] NSWADTAP 10 Gallagher v NSW Police Service [1998] NSWEOT, 20 September 1998 Penfold v Penfold (1980) 144 CLR 311 Australian Postal Commission v Dao & Anor (No 2) (1986) 6NSWLR 497 Russell v The Commissioner of Police, NSW Police Service and Others [2002] (No2) NSWADT 252 Peck v Commissioner of Corrective Services (No 2) [2002] NSWADT 244 V v Y& Anor; X v Y & Anor[2002] NSWADT 7 Duggan v Shore Inn Pty Limited (1993) EOC 92-483 Willis v State Rail Authority of New South Wales (No 3) (1992) EOC 92-456 Holdaway v Qantas Airways Ltd (1992) EOC 92-430 Squires v Qantas Airways Ltd (1985) EOC 92-135 Nowland v TNT Skypak & Anor (1994) EOC 92-560 Tu v University of Sydney (No 2) (EOD) [2002] NSWADTAP 25
REPRESENTATION:	APPLICANT R Beech-Jones, barrister FIRST RESPONDENT E Brus, barrister SECOND RESPONDENT A Wozniak, solicitor
ORDERS:	1 The First Respondent pay the legal costs incurred by the Applicant prior to 3 July 2000 within 28 days; 2 The First and Second Respondents pay the legal costs incurred by the Applicant from and including 3 July 2000 within 28 days; 3 If the parties are unable to agree on the amount of costs within 28 days, costs are to be determined by a costs' assessor in accordance with the Legal Profession Act, 1987.

1 This is an application by the Applicant for costs pursuant to s 114(2) of the Anti-Discrimination Act 1977 ("the ADA"). It is opposed by both Respondents. Before turning to the merits of the application, it is helpful to set out a brief history of the matter.

2 In its decision published on 26 March 2002 (Borg v Commissioner, Department of Corrective Services & Anor [2002] NSWADT 42), the Tribunal made various findings that the Respondents were liable, jointly and severally, in respect of the Applicant's claims that she had been subjected to sexual harassment and race discrimination by Mr Wheeler-Smith while she was working at Mulawa Correctional Centre ("Mulawa") as a Correctional Officer. The Tribunal also found that the First Respondent had victimised the Applicant by delaying her transfer to the John Morony Correctional Centre.

3 On 26 March 2002, the Tribunal made the following orders:

• In relation to the claim of sexual harassment, that the Respondents pay the Applicant within 21 days general damages in the sum of $27,500.
• In relation to the claim of race discrimination, that the Respondents pay the Applicant within 21 days general damages in the sum of $7,500.
• In relation to the claim of victimisation, that the First Respondent pay the Applicant within 21 days general damages in the sum of $12,500.

4 The Applicant's claims relate to events which occurred in 1996, 1997 and 1998. Although she did not lodge her complaint with the Anti-Discrimination Board ("the Board") until 11 February 1999, the President of the Board exercised his discretion pursuant to s 88(4) of the ADA to accept the complaint out of time.

5 Over a year earlier, on 18 December 1997, Mrs Borg had submitted a formal written complaint to the then Governor of Mulawa, Mr Campbell, alleging that Mr Wheeler-Smith had made racist remarks to her and that he had also sexually harassed her.

6 In due course, Senior Assistant Commissioner, Mr Woodham, appointed Superintendent Quinn of the Inmate Movements Section within the Department of Corrective Services ("the Department") to conduct an investigation into Mrs Borg's allegations.

7 Ms Quinn's report of 14 June 1998 was subsequently forwarded to the Department's Professional Standards Unit. Ms Quinn recommended that disciplinary action be commenced against Mr Wheeler-Smith in relation to the alleged racist comments and the alleged sexual harassment.

8 Subsequently, on 31 July 1998, Mr Woodham directed that the Governor of the John Morony Correctional Centre, Mr Peterson, conduct a preliminary inquiry into the above allegations.

9 As a result of recommendations made by Mr Peterson, Mr Woodham formally advised Mr Wheeler-Smith on 16 December 1998 that he had been charged with having committed two breaches of discipline within the meaning of s 66(1)(b) of the Public Sector Management Act 1988.

10 On 9 February 1999, Mr Woodham formally notified Mr Wheeler-Smith of his finding that the two disciplinary charges had been substantiated and that the appropriate punishment was a letter of reprimand and a formal direction that he attend a one day Harassment Prevention Seminar conducted by the Board. Mrs Borg was not advised of Mr Woodham's decision until 25 March 1999.

11 In her letter of complaint to the Board, Mrs Borg briefly referred to other alleged incidents of sexual harassment. She made it clear that her claim of sexual harassment was far broader than the one incident investigated by the Department. Her letter of complaint to the Board also suggested that her claim of race discrimination was wider than the one incident of racial discrimination investigated by the Department.

12 In the course of investigating Mrs Borg's allegations of discrimination and victimisation, the Board held a conciliation conference between the Department and Mrs Borg sometime in 1999. The parties were unable to conciliate the complaint.

13 It is common ground that Mr Wheeler-Smith was not involved in the President's investigation and conciliation processes. For reasons best known to the Board, Mr Wheeler-Smith was not joined as a respondent. Indeed it appears that Mr Wheeler-Smith did not become aware of Mrs Borg's complaint to the Board until 4 June 2000.

14 The complaint was formally referred to the Tribunal on 25 January 2000.

15 On 3 July 2000, the Applicant applied to the Tribunal to join Mr Wheeler-Smith as a respondent to the proceedings. The application was opposed by Mr Wheeler-Smith. No opposition was voiced by the First Respondent. Indeed it was conceded that it would be "preferable" for Mr Wheeler-Smith to be joined.

16 In its decision published on 29 August 2000, the Tribunal ordered that Mr Wheeler-Smith be joined as a respondent : see Borg v Commissioner, Department of Corrective Services [2000] NSWADT 118. The Tribunal also made directions on 29 August 2000 that the parties file and serve Points of Claim, Points of Defence and all relevant documents.

The Discretionary Costs' Rule

17 The general rule concerning costs, set out in s 114(1) of the ADA, provides that each party to an inquiry shall pay his or her own costs. However, s 114(2) empowers the Tribunal to make "such order as to costs . . . as it thinks fit" where it "is of the opinion in a particular case that there are circumstances that justify it doing so".

18 As was observed by the Appeal Panel in Cleary Bros (Bombo) Pty Ltd v Cvetkovski (EOD) [2001] NSWADTAP 10 at paras 63-65, s 114 of the ADA does not prescribe a test to be applied. Rather the section creates a presumption in subsection (1) and a discretion in subsection (2). This discretion must be exercised judicially, and no authority or rule can determine whether in any particular case an order should be made : Gallagher v NSW Police Service [1998] NSWEOT, 30 September 1998.

19 The Appeal Panel in Cleary at para 67 agreed with the Tribunal in Gallagher that in order to justify the making of an award of costs "there has to be something over and beyond a normal course of circumstances". The Panel then went on to say:

"This should be understood to mean nothing other than that the presumption in section 114(1) 'must yield' when in a particular case there are circumstances justifying the making of a costs order ( Penfold v Penfold (1980) 144 CLR 311 at page 315). To similar effect, there may be in a particular case 'circumstances which justify the departure from the general rule' ( Australian Postal Commission v Dao & Anor (No 2) (1986) 6NSWLR 497 at 505)."

20 It follows from the above that previous cases concerning costs' applications under s 114(2) can only provide an indication of the kinds of circumstances that may attract a costs' order. They cannot provide a comprehensive guide as to the circumstances in which costs awards will necessarily be made.

21 An examination of previous cases where costs have been awarded in favour of an applicant suggests that as a general proposition a combination of circumstances is required in order to justify an award of costs. See, for example, Russell v The Commissioner of Police, NSW Police Service and Others [2002] (No 2) NSWADT 252; Peck v Commissioner of Corrective Services (No 2) [2002] NSWADT 244; Gallagher; V v Y & Anor; X v Y & Anor [2002] NSWADT 7; Duggan v Shore Inn Pty Limited (1993) EOC 92-483; Willis v State Rail Authority of New South Wales (No 3) (1992) EOC 92-456; Holdaway v Qantas Airways Limited (1992) EOC 92-430; Squires v Qantas Airways Ltd(1985) EOC 92-135. See also the Appeal Panel's remarks in Cleary at paras 86-87.

22 In combination with other factors, the kinds of circumstances which have been regarded in previous cases as justifying the making of a costs' award include:

• Whether the applicant's costs exceed or are disproportionate to the amount of damages awarded (Russell; Peck; V y Y & Anor; X v Y & Anor; Duggan; Willis; Holdaway; cf Nowland v TNT Skypak & Anor (1994) EOC 92-560).
• The manner in which the parties have conducted the proceedings (Russell; Peck; V v Y & Anor; X v Y & Anor; Duggan; Holdaway).
• Whether the case raises any important public policy or public interest considerations (Willis; Holdaway).
• Whether the proceedings determine or clarify an important question of law (Russell; Squires).

23 The circumstances listed above appear to reflect an overall concern that the substantial rights and protections conferred by the ADA should not be undermined by the cost of vindicating them. See, for example, Gallagher; Duggan. The list is not intended, however, to be an exhaustive account of the kinds of circumstances which may be considered relevant to a costs' award.

The Applicant's Submissions: The First Respondent

24 The Applicant's submissions in relation to the First Respondent are set out in paras 25 to 28 below.

25 Although she was awarded a total of $47,500 in damages, her legal costs exceed $77,000. In order to substantiate her claims, she was required to conduct and fund proceedings which involved 7 days of hearing, to prepare written outlines, to prepare detailed points of claim, to prepare and file numerous witness statements including her own detailed statements, to summons various witnesses, to file various medical reports, to arrange for medical witnesses to attend the hearing, and to summons and inspect a substantial body of documents (held by the First Respondent).

26 Leaving aside the victimisation complaint which solely concerned the First Respondent, she was required to meet a completely different defence from each of the Respondents.

27 Although the First Respondent did not deny that the acts of harassment had occurred, he put in issue his legal responsibility for them. This necessitated a significant inquiry into the First Respondent's practices and procedures as well as the Department's management structure. The First Respondent's defence to the claims "always" had very little prospects of success and there was no truly arguable basis upon which he could have denied his liability for the Second Respondent's conduct.

28 Although there was a serious dispute as to whether the constituent documents of the victimisation claim were satisfied, this aspect of the proceedings occupied a relatively insubstantial part of the overall hearing time.

The Applicant's Submissions: The Second Respondent

29 The Applicant's submissions in relation to the Second Respondent are set out in paras 30-32 below.

30 Although the Second Respondent vehemently disputed the Applicant's claims, the sharp conflict between the evidence of Mrs Borg and her witnesses, and that given by Mr Wheeler-Smith was resolved in the Applicant's favour.

31 In some respects, the evidence of the Second Respondent and the witnesses called on his behalf passed beyond the realm of being material relevant to his denials into the realm of being inflammatory attacks upon the Applicant's personality and competence as a Correctional Officer. The effect of this was to exacerbate the damage already caused by the Second Respondent's breaches of the ADA.

32 Given the nature and complexity of the matter, it was both necessary and appropriate for the Applicant to be represented at the hearing by both her solicitor and counsel.

The First Respondent's Submissions

33 The First Respondent's submissions are set out in paras 34-38 below.

34 The defence relied upon under s 53 of the ADA was a valid and arguable defence. The Tribunal acknowledged the existence of the First Respondent's policies regarding harassment and grievances, and made no adverse comment about them or the training provided to the staff of the Department.

35 The Applicant initiated the application to join Mr Wheeler-Smith as a respondent to the proceedings and then inappropriately sought to have the First Respondent bear the costs of her "tactical error" in doing so.

36 The First Respondent did not have either the legal right or capacity to influence the Second Respondent's defence and, therefore, he should not be liable for any costs incurred by the Applicant arising from the nature of the Second Respondent's defence.

37 The issue of whether the Applicant had been subjected to victimisation was so linked, chronologically and factually, to the greater body of evidence that it was not possible to sever the issue from the proceedings as a whole.

38 There was nothing about the conduct of the proceedings that would attract a costs' award.

The Second Respondent's Submissions

39 The Second Respondent's submissions are set out in paras 40-53 below.

40 Costs should not be awarded to the Applicant as both she and her legal representatives needlessly prolonged the matter. In particular: "Counsel representing the Applicant caused the matter to be extended longer than should have been due [sic] to extraordinary lengthy cross-examination on many matters which ultimately were not relevant to the matter to be determined."

41 Should the Tribunal consider it appropriate to award costs, an order for costs should only be made against the First Respondent:

• The Second Respondent was not involved in the matter until 29 August 2000.
• If run in isolation, the case against the Second Respondent would have taken less than 2 days.
• Much of the case involved cross examination by the Applicant's counsel of witnesses called by the First Respondents.

42 The First Respondent was "ultimately obstructive" in relation to the matter while the Second Respondent did everything which was required of him in order to bring the matter to a quick conclusion.

43 Should costs be awarded against the Second Respondent:

• Costs incurred prior to 29 August 2000 should be excluded.
• Costs should be restricted to the attendance of one practitioner at the hearing: Tu v University of Sydney (No 2) (EOD) [2002] NSWADTAP 25.
The Tribunal's Reasons for Awarding Costs0

44 Having weighed up all the competing considerations, we are of the view that the combined effect of the circumstances listed in paras 45-52 below justifies an award of costs in the Applicant's favour.

45 The case involves a matter of public importance. It concerned the rights of Correctional Officers to work in an environment free of harassment and the corresponding obligations of the Department to provide such an environment. The public interest aspect of the case assumes even greater significance when it is recognised that the prevailing "prison culture" inhibits Correctional Officers from making formal complaints against their supervisors (see Borg [2002] NSWADT 42 at paras 208, 211).

46 The case clearly highlights the importance of the Department's policies and grievance procedures being properly implemented by the First Respondent's most senior officers at Mulawa (see Borg [2002] NSWADT 42 at paras 107-109, 158-160). It is likely to have a beneficial flow on effect to other Correctional Institutions.

47 The Applicant's legal costs exceed her total damages award by nearly $30,000. In the absence of a costs' order in her favour, she will clearly be significantly out-of-pocket.

48 The First Respondent's defence of the Applicant's race discrimination and sexual harassment claims lacked any real prospects of success from the outset. In reaching this view, we place particular emphasis on the following:

• The Second Respondent's seniority within the Department and his supervisory role in relation to the Applicant.
• The First Respondent never denied that Mr Wheeler-Smith had sexually harassed Mrs Borg in the manner alleged or that he had made the alleged racist remarks to her. Indeed the Department itself had instituted disciplinary proceedings against him and found them substantiated (see paras 9 – 10 above).
• The Governor of Mulawa was on notice in 1996 and 1997 about the Second Respondent's inappropriate conduct towards female members of staff (see Borg [2002] NSWADT 42 at paras 102 – 109).

49 The case was a lengthy and complex one. It justified the presence of both the Applicant's counsel and solicitor throughout the entire hearing.

50 There was nothing about the manner in which the Applicant conducted the proceedings which warranted criticism. Contrary to the Respondents' submissions:

• It was necessary for the Second Respondent to be joined to the proceedings. Indeed, the First Respondent originally conceded that it was "preferable" that this be done: see Borg [2002] NSWADT 118.
• The Applicant did not needlessly prolong the matter.
• There was nothing inappropriate about counsel's cross examination of the Respondents' witnesses.

51 The attempts made by the Second Respondent during the course of the hearing to denigrate the Applicant's character were entirely unwarranted and had the effect of heightening her anguish and distress (see Borg [2002] NSWADT 42 at para 224).

52 The victimisation claim comprised a relatively insubstantial part of the overall proceedings. However, as acknowledged by the First Respondent, it was not possible to sever this issue from the proceedings as a whole (see para 37 above).

Conclusion

53 In our view, the First Respondent and the Second Respondent should be liable, jointly and severally, for the Applicant's costs incurred since 3 July 2000 (the date of the joinder application). The First Respondent should be liable for the Applicant's costs incurred prior to 3 July 2000.

Orders
1. The First Respondent pay the legal costs incurred by the Applicant prior to 3 July 2000 within 28 days.

2. The First and Second Respondents pay the legal costs incurred by the Applicant from and including 3 July 2000 within 28 days.

3. If the parties are unable to agree on the amount of costs within 28 days, costs are to be determined by a costs' assessor in accordance with the Legal Profession Act, 1987.