Crawford v Geocore Pty Ltd (No 2)
[2024] FedCFamC2G 656
•7 August 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Crawford v Geocore Pty Ltd (No 2) [2024] FedCFamC2G 656
File number: MLG 1412 of 2023 Judgment of: JUDGE FORBES Date of judgment: 7 August 2024 Catchwords: FAIR WORK –- application for imposition of civil penalties for contraventions of the Fair Work Act 2009 (Cth) – consideration of relevant factors – where conduct appears deliberate or recklessly indifferent – need for deterrence - totality – penalties ordered
FAIR WORK - application for costs – applicant seeks indemnity costs – where applicant forced to commence proceedings to enforce contraventions – where respondents have not engaged in any proceedings – consideration of conduct of the respondents – whether indemnity costs appropriate – where non-participation of respondents meant that applicant met with no resistance – respondent to pay costs on scale
Legislation: Fair Work Act 2009 (Cth) s 44, 336, 340, 527, 570 Cases cited: Augusta Ventures Ltd v Mt Arthur Coal Pty Ltd [2020] FCAFC 194
Australian Building and Construction Commissioner v Pattinson [2022] HCA 13
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2018) 262 CLR 157
Australian and International Pilots Association v Qantas Airways Ltd (No 3) [2007] FCA 879
Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8
Commonwealth of Australia v Construction, Forestry, Mining and Energy Union [2003] FCAFC 115
Crawford v Geocore Pty Ltd [2024] FedCFamC2G 176
Fair Work Ombudsman v NSH North Pty Ltd t/as New Shanghai Charlestown [2017] FCA 1301
Fair Work Ombudsman v Raimondi Investments Pty Ltd [2016] FCCA 1398
Fair Work Ombudsman v WCH Services Pty Ltd & Anor [2018] FCCA 1876
Kambouridis v L.R. Reed City Pty Ltd [2020] FCCA 1484
Kelly v Fitzpatrick [2007] FCA 1080
Meadley v Sort Worx Pty Ltd [2013] FCA 1012
Murdock v Virgin Australia Airlines Pty Ltd (No 3) [2024] FCA 227
Payne v Secure Melbourne Protective Services Pty Ltd (No 2) [2023] FCA 1579
Ryan v Primesafe [2015] FCA 8
Rybinski v Geocore Pty Ltd [2024] FedCFamC2G 177
Rybinski v Geocore Pty Ltd (No 2) [2024] FedCFamC2G 644
Saxena v PPF Asset Management Ltd [2011] FCA 395
Schell v Ensign Australia Pty Ltd [2015] FWC 8825
Trade Practices Commission v CSR Ltd [1990] FCA 521
Trustee for The MTGI Trust v Johnston (No 2) [2016] FCAFC 190
Umoona Tjutagku Health Service Aboriginal Corporation v Walsh [2019] FCAFC 32
Division: Division 2 General Federal Law Number of paragraphs: 64 Date of hearing: On the papers Place: Melbourne Solicitor for the Applicant: Mr Sherr & Mr Jackson, Sparke Helmore Lawyers Respondents: No appearance ORDERS
MLG 1412 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: ELIZABETH CRAWFORD
Applicant
AND: GEOCORE PTY LTD
First Respondent
AMANDA BROWN
Second Respondent
ORDER MADE BY:
JUDGE FORBES
DATE OF ORDER:
7 AUGUST 2024
THE COURT ORDERS THAT:
1.Pursuant to section 546(1) of the Fair Work Act 2009 (Cth) (FW Act) the First Respondent pay a pecuniary penalty of $75,000 for its contraventions of sections 44 (two contraventions), 340 and 527 of the FW Act.
2.Pursuant to section 546(1) of the Fair Work Act 2009 (Cth) (FW Act) the Second Respondent pay a pecuniary penalty of $15,000 by reason of her involvement in the First Respondent’s contraventions of sections 44 (two contraventions), 340 and 527 of the FW Act.
3.The penalties ordered pursuant to Orders 1 and 2 be paid to the Applicant.
4.The First and Second Respondent pay the Applicant’s costs on a standard basis in accordance with the scale prescribed in the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) as at the date of hearing.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE FORBES
INTRODUCTION
The applicant in this matter, Ms Crawford, seeks the imposition of a pecuniary penalty against the respondents for contravening the following civil penalty provisions of the Fair Work Act 2009 (Cth) (FW Act):
(a)section 44 by failing to pay the Applicant an amount to satisfy her entitlement to accrued but untaken annual leave and annual leave loading upon the end of her employment as required by section 90 of the FW Act (the annual leave contravention);
(b)section 340 of the FW Act by taking adverse action against the applicant by reason of her exercising, purporting to exercise and to prevent her exercising, workplace rights (the general protections contravention);
(c)section 44 of the FW Act by failing to provide the applicant with payment in lieu of notice as required by section 117 of the FW Act (the payment in lieu of notice contravention); and
(d)section 527 of the FW Act by failing to comply with the order (FWC Order) of Commissioner Mirabella dated 21 October 2022 (the FWC order contravention).
The applicant also seeks that her legal costs be paid by the respondents on an indemnity basis.
The relevant background to this matter is contained in the reasons for the default judgment, Crawford v Geocore Pty Ltd [2024] FedCFamC2G 176. The reasons in the default judgment inform my decision on penalties and costs and should be read with this judgment.
On 1 February 2024 I entered default judgment against the first respondent, finding that Geocore Pty Ltd (Geocore) contravened the abovementioned provisions. Geocore did not participate in the proceedings and offered no defence. By reason of its failure to engage in the proceeding the court gave judgment against the respondent for the relief that the applicant appeared entitled to on her statement of claim[1]. I also entered judgment against the second respondent, Ms Amanda Brown, finding on the available evidence that she was relevantly involved in the contraventions pursuant to s 550 of the FW Act. I ordered the first and second respondents to pay compensation to the applicant.
[1] Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 r 13.05(c)
The court orders made on 1 February 2024 required the parties to file and serve any submissions on the issues of penalties and costs and for the issues to be determined on the papers. The applicant has filed submissions and a supporting affidavit. The respondents did not file any submissions on costs or penalties. In fact, they have not engaged with any aspect of this litigation.
Having considered the applicant’s written submissions, I have decided to impose a total penalty of $75,000 against the first respondent and a total penalty of $15,000 against the second respondent. I have also decided that the respondents should be jointly and severally be liable for the applicant’s costs, calculated in accordance with Schedule 2 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
My reasons are set out below.
PENALTY
At the relevant time, the maximum penalty for a single contravention of each of sections 44, 340 and 527 was:
(a)$82,500 for a corporate respondent; and
(b)$16,500 for an individual respondent.
The Court has declared two contraventions of section 44 and a single contravention of each of ss 340 and 527. The maximum penalties for which the first respondent could be liable is $330,000 and for the second respondent, $66,000.
For the reasons outlined in her written submissions, the applicant seeks total penalties in the range of $181,500 to $214,500 for the first respondent and $36,300 - $42,900 for the second respondent. This amounts to an overall penalty in the range of 55-65% of the maximum.
Ms Crawford seeks that the penalties be paid to her within 28 days or such further period that the Court determines appropriate. The applicant submits that is appropriate for the penalties to be paid to her as she has carried the weight of the economic loss, delay and the burden of bringing the proceedings.
Applicable legal principles
The legal principles relevant to the determination of penalties for contraventions of the FW Act are well-established and often cited. The principal objective of penalties is to ensure compliance with the provisions of the Act by deterring further contraventions.
The application for penalties in this case is similar in many respects and invokes the same consideration of principles as those discussed in Rybinski v Geocore Pty Ltd (No 2) [2024] FedCFamC2G 644 (Rybinski (No 2)). In that matter the Court considered an application by a co-worker of Ms Crawford for the imposition of penalties and costs against Geocore and Ms Brown after default judgment was entered against them for similar, but not identical, contraventions.
In Rybinski (No 2) I set out the applicable legal principles and it is unnecessary for me to do so again. Suffice to say the objective of deterrence[2] is at the forefront of my mind, as is ensuring that any penalty is appropriate and proportionate to the contraventions, taking all relevant factors into account[3].
[2] Australian Building and Construction Commissioner v Pattinson [2022] HCA 13 (Pattinson) at [9], [15]
[3] Fair Work Ombudsman v NSH North Pty Ltd t/as New Shanghai Charlestown [2017] FCA 1301 at [36]; Kelly v Fitzpatrick [2007] FCA 1080 at [30]; Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8 at [23], [71] and [102]
As I have explained elsewhere, there are number of considerations which routinely guide the Court in its assessment of the gravity and seriousness of contraventions and the appropriateness of any penalty[4]. It is to those matters I now turn.
[4] Trade Practices Commission v CSR Ltd [1990] FCA 521 at [42]; see also Pattinson at [18]; Kelly v Fitzpatrick [2007] FCA 1080 at [14]
Deterrence
The Court must take into account the objective of both general deterrence, being deterrence against the community at large for other would be or like-minded contraveners, and specific deterrence, being deterrence against the contravener themselves[5].
[5] Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (CFMEU) (2018) 262 CLR 157 [116]
General
Ms Crawford submits that there is a high need for general deterrence in this matter. The contravention involving the respondents refusal to comply with the orders of Commissioner Mirabella to redress the unlawful stand down of the applicant is especially prominent in that respect.
The regime established by the Fair Work Commission to address adverse consequences of an unlawful stand down has been fundamentally undermined by the respondents[6]. The observation of Tracey J in Meadley v Sort Worx Pty Ltd [2013] FCA 1012 at [45] is apt:
“An employer is not entitled unilaterally to determine to ignore an order made by the Commission. This was not a case in which the employer was unable to meet its obligations; it simply chose not to do so […]”
[6] Schell v Ensign Australia Pty Ltd [2015] FWC 8825 at [22]
Regarding the annual leave contravention and the payment in lieu of notice contraventions, Ms Crawford submits that these are breaches of the National Employment Standards, which deprived her of the most basic statutory entitlements.
The general protections contravention, says the applicant, offends the purpose of Part 3 - 1 of the FW Act, which is to ensure fairness in the workplace and prevent discrimination[7]. The applicant contends that she was trying to assert a basic workplace right (seeking assistance from the Commission to resolve a dispute and take personal/carer’s leave), and as a consequence was stripped of her rights as a full-time employee. She submits that the respondents conduct was completely unjustified and egregious.
[7] Fair Work Bill 2008 Explanatory Memorandum at [1333]; Fair Work Act 2009 (Cth) s 336
There can be little doubt that each of the contraventions referred to above undermines the scheme of the FW Act which includes a right to minimum terms and conditions of employment and protections for those who seek to exercise the general workplace rights. There is a strong public interest in ensuring other like-minded employers are deterred from engaging in similar contravening behaviour.
Specific
Ms Crawford submitted that penalties are also necessary to effect specific deterrence because:
(a)the respondents failed to engage with proceedings at any stage and effectively snubbed the Fair Work Commission and the Court;
(b)the respondents have not taken any steps to rectify the underpaid entitlements owed to the applicant since the commencement of proceedings. The Court should infer from this that the respondents have little regard for the FW Act and orders of the Commission and this Court. It is submitted that there is a risk that the respondents will engage in such conduct again in the future;
(c)the Court has determined in both Ms Crawford and Ms Rybinski’s matter[8] that the respondents contravened ss 44 and 527, demonstrating a propensity towards engaging in this conduct with other employees; and
(d)the applicant has seen no consequences for the respondents’ repeated disregard for the FW Act and the law, enhancing the need for a large penalty.
[8] Rybinski v Geocore Pty Ltd [2024] FedCFamC2G 177
Nature, circumstances and deliberateness of conduct
The Court has declared that the respondents contravened s 340 of the FW by taking adverse action against the applicant by reason of her exercising, purporting to exercise and to prevent her exercising, workplace rights. The alleged adverse action included the respondents unilateral conversion of her full-time employment to casual and the repudiation of her contract of employment. Ms Crawford alleges that, as a result of the adverse action, she suffered, among other things, non-economic harm including depression, anxiety and disturbance to important life plans for retirement and post-retirement[9].
[9] Affidavit of Elizabeth Crawford affirmed on 16 November 2023 at [55] to [59] (Crawford Affidavit)
Ms Crawford submits that the general protections contravention was impersonal and dishonest, as the unilateral change to her employment was never discussed with the applicant and was only discovered when she noticed an annotation on her pay slip[10]. Due to their non-participation in the proceedings, the respondents are taken not to contest Ms Crawford’s submission that this adverse action was a punitive and deliberate response to her attempts to exercise her workplace rights, which were to commence FWC proceedings and/or to take personal/carer’s leave.
[10] Crawford Affidavit at [43], Annexure EC – 8
In relation to the annual leave contravention, Ms Crawford gave evidence that the respondents endeavoured to access and run down her leave balance after she was unlawfully stood down[11]. She submits that the Court should infer from this conduct that the respondents intended to unlawfully reduce the balance of her annual leave.
[11] Crawford Affidavit at [21]
Further, upon the cessation of employment the respondents simply refused to pay out Ms Crawford’s annual leave. On several occasions, both personally and through her lawyers, the applicant sought payment of her entitlements[12], but these requests were ignored.
[12] Crawford Affidavit, Annexure EC – 10 and Annexure EC – 11; Affidavit of Kristina Sianidis Singh dated 16 November 2023, Annexure KS – 3
I have accepted that Ms Crawford’s full-time employment was repudiated when it was unilaterally changed to casual employment. This non-consensual act by the respondents occurred without the statutory warning Ms Crawford was entitled to, or payment in lieu of notice. It is submitted that the payment in lieu of notice contravention was as deliberate and serious of each of the other contraventions.
In respect of the FWC order contravention, the applicant submits[13]:
(a)the conduct occurred in circumstances where the respondents were aware of the initial FWC proceedings and failed to engage and then of the FWC Order which they refused to obey;
(b)it was open to the respondents from October 2022 to comply with the FWC Order, and they simply elected not to; and
(c)compliance with the FWC Order simply required the first respondent to cease its unlawful stand down of the applicant and return her to work. There was no reason why the respondents could not comply with the FWC Order.
[13] Applicant’s Outline of Submissions at [25]
In the absence of any explanation from the respondents as to why they engaged in the contraventions, the applicant invites the Court to find that the respondents’ actions were deliberate.
Involvement of senior management
In the default judgment I found that the second respondent, Ms Brown, as the director and controlling mind of Geocore, was involved in each of the contraventions within the meaning of s 550 of the FW Act. By reason of that involvement Ms Brown is taken to have contravened the Act and is liable to penalties for the contravention. The applicant’s submission that senior management was directly involved in the contraventions is beyond contest.
Nature and extent of loss
The total loss sustained by the applicant as a result of the contraventions was $21,662.48, which Ms Crawford submits is a large sum for a low-level employee. She deposes that as a result of the contraventions, she was forced to accept a different job that did not provide the same financial support[14]. She also deposes to various mental health impacts and disillusionment with the Fair Work system as a whole, which favours the imposition of a higher penalty.
[14] Crawford Affidavit at [57]
Size of business
There is no direct evidence before the Court regarding the size of the business, but I accept that Geocore is relatively small in size.
Corrective action and cooperation
As mentioned above, Geocore and Ms Brown have failed to engage in proceedings and have not taken any steps to correct the contraventions. They have not displayed any remorse or contrition for their actions.
Compliance with minimum standards
The purpose of the FW Act is to provide a guaranteed set of fair, relevant and enforceable terms and conditions of employment and protect the applicant’s ability to enforce these standards. Ms Crawford contends that the respondents’ failure to comply with the FWC order goes against the basic concept of the rule of law[15], and the respondents should be penalised appropriately. The payment in lieu of notice contravention also goes against “longstanding minimum standards”[16].
[15] Fair Work Ombudsman v Raimondi Investments Pty Ltd [2016] FCCA 1398 at [29]
[16] Fair Work Bill 2008 Explanatory Memorandum at [469]
Conclusion on penalty
The applicant seeks penalties in the range of $181,500 to $214,500 for the first respondent and $36,300 to $42,900 for the second respondent for contravening ss 44, 340 and 527. This amounts to an overall penalty of 55-65% of the maximum available penalties.
In determining the penalties to be ordered against Geocore, this Court must have regard to the totality of the contravening conduct to ensure that any penalty ordered is not crushing or oppressive[17].
[17] Pattinson at [110]
The applicant submits that the proposed penalty is appropriate in circumstances were there is no evidence before the Court as to the respondents’ financial capacity, and therefore no way of assessing what might be crushing or oppressive to the respondents.
Objectively, the contraventions are serious and the conduct of the respondents appears calculated and intended to deny the applicant the entitlement of her appointment. The attempt to unilaterally change the character of Ms Crawford’s employment from full-time to casual is particularly egregious as is the respondents failure to comply with orders of the Fair Work Commission. The conduct is deserving of a significant penalty to achieve the objective of deterrence.
I agree with the applicant that the contraventions do not arise out of a single course of action and are not readily grouped. That does expose the respondents to a very high maximum.
However, as I explained in Rybinski (No 2), I consider the penalties sought by the applicant to be excessive. While not excusing its conduct, the first respondent is a small business and it has no prior history of having contravened the FW Act. There is no evidence before the court regarding the financial circumstances of either of the respondents and therefore there is no way of knowing what level of penalty might be crushing or oppressive. Nonetheless the penalties sought by the applicant in this case (which amount to nearly $250,000), coupled with the penalty in Rybinski (No 2), may well cross that threshold.
The court is required to impose a final review of the aggregate penalty is to determine whether it is an appropriate and proportionate response to the conduct which led to the contraventions. Even allowing for a mid-range assessment, the penalties to be imposed would amount to more than $160,000 for Geocore and more than $30,000 for Ms Brown. These penalties are too high and risk injustice.
It is appropriate, in the process of instinctive synthesis, to have regard to all relevant factors (such as those discussed above) and to the fact that in other proceedings a not insubstantial penalty has been imposed.
I consider the contraventions in respect of Ms Crawford to be more egregious than those perpetrated against Ms Rybinski. The general protections contravention distinguishes the two matters. In all the circumstances I have decided that the appropriate total penalty to be imposed on the first respondent is $75,000 for all of the declared contraventions. A total penalty of $15,000 will be imposed on the second respondent for her involvement.
COSTS
Section 570 of the FW Act states:
Costs only if proceedings instituted vexatiously etc.
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;
b.or 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.
As to the legal principles which apply to the courts consideration of an application for costs in a Fair Work Act proceeding, I again refer to the discussion in Rybinski (No 2).
In proceedings brought under the FW Act, costs will usually be borne by the party incurring them[18]. Ordinarily, costs will not be awarded automatically and the usual rule of costs following the event does not apply. The legislative intent underlying s 570 is that potential applicants should not be put off from commencing proceedings due to a fear of costs being incurred if they are unsuccessful[19]. In an otherwise no-costs jurisdiction, the discretion to order costs must be exercised with caution[20]. A clear case for its exercise must be demonstrated. Even where the threshold is met, the Court retains a discretion.
[18] Murdock v Virgin Australia Airlines Pty Ltd (No 3) [2024] FCA 227 at [3] (Burley J); Commonwealth of Australia v Construction, Forestry, Mining and Energy Union [2003] FCAFC 115 at [10] (Black CJ, Tamberlin and Sundberg JJ); Augusta Ventures Ltd v Mt Arthur Coal Pty Ltd [2020] FCAFC 194 at [102] (White J, with whom Middleton J agreed at [89])
[19] Murdock v Virgin Australia Airlines Pty Ltd (No 3) [2024] FCA 227 at [3] (Burley J); (Ryan v Primesafe [2015] FCA 8 at [64] (Mortimer J); Trustee for The MTGI Trust v Johnston (No 2) [2016] FCAFC 190 at [8] (Siopis, Collier and Katzmann JJ)
[20] Murdock v Virgin Australia Airlines Pty Ltd (No 3) [2024] FCA 227 at [3] (Burley J); Saxena v PPF Asset Management Ltd [2011] FCA 395 at [6] (Bromberg J)
The applicant for costs bears the onus of satisfying the Court that one or more of the criteria in s 570(2) are met. Determining whether a party acted unreasonably must be determined objectively according to the facts on a case by case basis[21].
[21] Australian and International Pilots Association v Qantas Airways Ltd (No 3) [2007] FCA 879 at [32] (Tracey J)
Indemnity costs
Even where the discretion is exercised to award costs, the ordinary rule is that costs are to be awarded on a party/party basis. There should be some “special or unusual feature in the case”[22] to warrant a departure from that rule.
[22] Umoona Tjutagku Health Service Aboriginal Corporation v Walsh [2019] FCAFC 32 at [48]
Submissions
Ms Crawford seeks an order pursuant to sections 570(2)(b) and/or 570(2)(c) of the FW Act for the respondents to pay her costs as follows:
(a)$20,655.40 in respect of costs on an indemnity basis from 18 October 2023 to 1 February 2024 and party to party costs otherwise; and
(b)$1,245.00 in respect of disbursements.
The applicant submits that the following unreasonable actions caused her to incur costs:
(a)the respondents’ failure to comply with the FWC Order;
(b)the respondents’ failure to comply with the letter of demand dated 1 August 2023;
(c)the respondents’ failure to comply with the Federal Circuit And Family Court Of Australia (Division 2) (General Federal Law) Rules 2021 (Rules) in relation to the filing of a response within 28 days after service;
(d)the respondents’ failure to comply with the September Orders; and
(e)the respondents’ failure to attend any hearing before this Court, or otherwise engage with the proceedings in any way, necessitating the making of the Application.
As I discussed in Rybinski (No 2), this Court has previously concluded that a complete failure to engage in proceedings may constitute an unreasonable act[23].
[23] For example, in Kambouridis v L.R. Reed City Pty Ltd [2020] FCCA 1484
In the present case Ms Crawford submits that the Fair Work Commission (FWC) had determined the underlying stand down dispute and the respondents failed to comply with the FWC order, without any lawful reason. That conduct “effectively forced the applicant to bring proceedings, despite there being no real dispute: such conduct is unreasonable as it wastes the applicant’s costs”[24].
[24] Kambouridis v L.R. Reed City Pty Ltd [2020] FCCA 1484 at [35]
In Fair Work Ombudsman v WCH Services Pty Ltd & Anor [2018] FCCA 1876, the applicant sought costs under s 570(2)(b), or alternatively s 570(2)(c), in circumstances where the respondents failed to comply with a FWC order and did not engage in the proceedings before the FWC or the then Federal Circuit Court. Judge Hartnett (as her Honour then was) awarded costs to the applicant under s 570(2)(b) for the following reason:
“On an objective analysis of the circumstances, the Respondents’ conduct has not been what a reasonable person would expect, and has directly caused the Applicant to incur costs. The Respondents have been put on notice as to the costs application and have provided no response for the Court to consider. The Court is satisfied that the Respondents failure to pay the amount ordered by [the FWC] was unreasonable and has caused the Applicant to incur costs.”
Separately and additionally, the applicant argues that she is entitled to costs under s 570(2)(c) because the respondents unreasonably refused to participate in a matter before the FWC and the matter before this Court arose from the same facts as the FWC proceedings. The applicant asserts that the purpose of this ground is to allow the Court to award costs against a party that unreasonably refused to participate in the FWC proceedings and is designed to encourage genuine participation in disputes and efficient resolution of proceedings[25].
[25] Fair Work Bill 2008 Explanatory Memorandum at [2230]
The applicant states that the total costs incurred are as follows:
(a)since the statement of claim was filed, $22,854.10
(b)since the time at which both respondents had been served, $20,846.00;
(c)since the time at which both respondents defaulted regarding filing and serving a NoAFS, $17,981.10;
(d)since the time at which both respondents defaulted regarding the filing and service of responses in accordance with the Court’s orders on 27 September 2023, $17,187.40; and
(e)since the filing of the Application, $5,475.
And the applicant’s reasonable disbursements are as follows:
(a)$785 in Court fees to commence this proceeding;
(b)$460 in Court fees to file the Application; and
(c)$246.40 on process server costs to serve the commencing documentation and the Application.
Conclusion on costs
The Respondents have been put on notice as to the costs application and have provided no response for the Court to consider. They have chosen not to participate in the proceedings at all.
I am satisfied in all the circumstances that the respondent’s conduct in failing to participate in the Fair Work Commission proceedings, failing to comply with the order of the Commission and failing to engage in the proceedings in this court are unreasonable acts and omissions which have caused the applicant to incur unnecessary costs. For present purposes, I am satisfied that s 570(2)(b) is engaged and that I should exercise my discretion to order costs.
However, as in Rybinski (No 2) and for the same reasons, I consider the costs sought by the applicant are excessive. The failure of the respondents to engage in the proceeding has resulted in the application for default judgment and the applications for costs and penalties meeting no resistance. The steps taken by the applicant to obtain relief in the court are the minimum steps it would have had to take whether the proceeding was or was not contested. The conduct of the respondents has been unreasonable, but not so egregious as to warrant an order for indemnity costs.
I will order that the respondents pay the applicants costs of these proceedings. Such costs should be calculated in accordance with the scale prescribed in Schedule 2 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
DISPOSITION
Orders will be made that the first respondent paid total penalty of $75,000 in respect of its four declared contraventions of the FW Act, namely ss 44 (two contraventions), 340 and 527.
Further, the second respondent, who I am satisfied was relevantly involved in the first respondent’s contraventions of ss will be ordered to pay a total penalty of $15,000.
The penalties referred to in the preceding paragraphs are to be paid to the applicant within 28 days of these orders. The applicant commenced and maintained the proceedings, it is appropriate that the penalty be paid to her.
As to costs, I will order that the respondents pay the applicants costs of the proceeding, calculated in accordance with Schedule 2 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Forbes. Associate:
Dated: 7 August 2024
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