Dallisson v MK2 Recruitment Pty Ltd
[2021] FedCFamC2G 115
•5 October 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Dallisson v MK2 Recruitment Pty Ltd [2021] FedCFamC2G 115
File number(s): ADG 98 of 2021 Judgment of: JUDGE BROWN Date of judgment: 5 October 2021 Catchwords: INDUSTRIAL LAW – fair work – termination of employment – unfair dismissal – general protections – alleged breach of general protection powers pursuant to the Fair Work Act 2009 (Cth) – where the reason for the applicant’s termination is in contention – application for an extension of time – costs – application for costs – analysis of the law relating to a representative error Legislation: Fair Work Act 2009 (Cth), Pt 3-1, ss 342, 351, 361, 365, 368, 370, 539, 545, 570
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), Div 23.1, 23.2 rr 22.02, 22.06
Federal Circuit and Family Court of Australia Act 2021 (Cth), s 169
Federal Circuit Court Rules 2001 (Cth), r 45.06Cases cited: Australian Worker’s Union v Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428
Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541
Brodie‑Hanns v MTV Publishing Ltd (1995) 67 IR 298
CFMEU v Clarke (2008) 170 FCR 574
Clarke v Ringwood Private Hospital (1997) 74 IR 413
Clarke v Service to Young Council Incorporated [2013] FCA 1018
Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344
Milas v GM Holden Limited [2015] FCCA 1311
Saxena v PPF Asset Management Ltd [2011] FCA 395Division: Division 2 Family Law Number of paragraphs: 72 Date of hearing: 28 September 2021 Place: Adelaide Solicitor for the Applicant: Union Legal SA Counsel for the Applicant: Ms Makris Solicitor for the Respondent: Davidson Ryan Lawyers Counsel for the Respondent: Mr Mackie ORDERS
ADG 98 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: ALICIA KATE DALLISSON
Applicant
AND: MK2 RECRUITMENT
Respondent
ORDER MADE BY:
JUDGE BROWN
DATE OF ORDER:
5 OCTOBER 2021
THE COURT ORDERS THAT:
1.The applicant is granted an extension of time to file her Application – Fair Work Division form dated 19 April 2021 and Form 2 Claim under the Fair Work Act 2009 (Cth) alleging dismissal in contravention of a general protection dated 9 April 2021 to 20 April 2021.
2.The proceedings be referred to a Registrar for mediation under section 169 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) and Division 23.1 and 23.2 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), with such mediation to be conducted on 18 November 2021 at 9.30 am or at a date and time to be fixed by the Registrar conducting the mediation.
3.There be no order as to costs.
4.The matter be adjourned until 30 November 2021 at 9:30 am.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review 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 BROWN:
INTRODUCTION
These reasons for judgment relate to an application for an extension of time in which to file an adverse action proceeding, pursuant to the provisions of the Fair Work Act 2009 (Cth).[1] This primary matter has more recently been consumed by issues relating to costs and who should bear them, in respect of an error, or series of errors, made by the applicant’s solicitor.
[1] Hereinafter referred to as ‘the FWA’ or ‘the Act’.
The applicant, Alicia Kate Dallisson, was employed by the respondent, MK2 Recruitment Pty Ltd (‘MK2’), as its Operations Manager, at its Adelaide offices. MK2 is a recruitment firm, which recruits operational staff, for its various clients, in the mining, civil engineering and similar industries.
The applicant commenced her employment, with the respondent, pursuant to a contract on 1 September 2020 and was employed by it until her dismissal on 28 January 2021. On or about 5 November 2020, Ms Dallisson alleges that she informed one of the directors of the respondent that she was pregnant.
Ms Dallisson alleges that the respondent altered the nature of her position, with MK2, in a manner prejudicial to her and ultimately dismissed her from her employment because she was pregnant.
As a consequence, it is the applicant’s position that the provisions of Part 3-1 of the FWA are engaged in that the respondent has taken adverse action against her, as defined by section 342(1) of the Act, for a discriminatory reason, as delineated by section 351, namely her pregnancy.
Section 342(1) of the Act contains a table setting out the circumstances, in which a person is to be regarded as having taken adverse action against another person. The first item of the table provides as follows:
Adverse action is taken by an employer against an employee if the employer:
(a)dismisses the employee; or
(b)injures the employee in his or her employment; or
(c)alters the position of the employee to the employee’s prejudice; or
(d)discriminates between the employee and other employees of the employer.
Section 351(1) reads as follows:
An employer must not take adverse action against a person who is an employee, or prospective employee, of the employer because of the person's race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin.
Section 351 is characterised as a civil remedy provision under the Act. As a consequence, if the applicant is able to make out her claim that she was subject to adverse action by the respondent, MK2 may be liable to a pecuniary penalty pursuant to the provisions of section 539(2) and Ms Dallisson herself may be entitled to receive compensation pursuant to section 545(2) of the Act.
Pursuant to section 365 of the FWA, the applicant applied to the Fair Work Commission to deal with the dispute between her and MK2 Recruitment, following her dismissal. On 31 March 2021, a Commissioner of the Fair Work Commission certified as follows:
An application pursuant to s.365 of the Fair Work Act 2009 (the Act) was made by Ms Alicia Dallisson alleging she was dismissed by MK2 Recruitment Pty Ltd in contravention of Part 3-1 of the Act.
The Fair Work Commission conducted conferences to deal with the dispute on 11 March 2021.
Pursuant to s.368(3) of the Act, the Fair Work Commission certifies that it is satisfied that all reasonable attempts to resolve the dispute have been, or are likely to be, unsuccessful.[2]
[2] See Application filed on behalf of Alicia Kate Dallisson on 20 April 2021.
The resulting certificate, issued under section 368(3) of the FWA following this conference, contained, under the underlined heading: ‘Important Note’, an indication that the time limit in which to make a general protection application, to either this Court or the Federal Court, was fourteen days, unless the Court extended the time for making such an application.
At relative times, the Federal Circuit Court Rules2001 (Cth) (now the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)) required an Application, under the general protection provisions of the FWA to be made to the Court’s Fair Work Division by way of an approved form, known as a Form 2. In particular, Rule 45.06 of the then Federal Circuit Court Rules2001 (Cth) read as follows:
An application for an order in relation to an allegation that an employee was dismissed in contravention of a general protection mentioned in Part 3-1 of the Fair Work Act must:
(a) be in accordance with the approved form; and
(b) be accompanied by:
(i) a claim in accordance with the approved form; and
(ii) unless the application includes an application for an interim injunction, a certificate issued by the Fair Work Commission under the Fair Work Act that provides that the Fair Work Commission is satisfied that all reasonable attempts to resolve the dispute have been, or are likely to be, unsuccessful.
The Court record, in respect of the current matter, indicates that the applicant’s solicitor, Ms Leanne Thomas, filed such a Form 2 at 11.56am on 20 April 2021. This is the date and time endorsed on the Court issued cover sheet. Attached to this Application was a copy of the Contract of Employment between Ms Dallisson and MK2, together with the Fair Work Commission certificate dated 31 March 2021 and some other documents said to be relevant. Ostensibly, on its face, the Application was out of time.
In this Application, Ms Dallisson indicated that she is seeking compensation for economic loss in the sum of $34,600.00, which she equates to 20 weeks of her salary with the respondent, together with non-economic compensation in an amount of $20,000.00, which she asserts represents the hurt, humiliation and loss suffered as a result of what she characterises as her unlawful dismissal.
Accordingly, on its face, the Application was some six or seven days out of time. Concurrently with the Form 2 Application, Ms Thomas filed an Application where she sought the following interim orders:
Interlocutory application to extend time. The form 2 and FWC certificate were lodged on 13 April (within time) however the originating application due to e lodgement system limitations could not be lodged. Several attempts have been made and several calls and emails to and from the Registry have been unsuccessful.[3]
[3] Ibid.
Those advising the respondent take issue with the probity of this assertion. It is now conceded, by the respondent, that the time should be extended for Ms Dallisson to file her Application but the costs wasted by the respondent in respect of the issue should be reimbursed either by the applicant or her solicitor.
The respondent filed a Response to this Application and a Defence on 28 May 2021. Essentially, it is denied that any operational changes were made to the applicant’s positon because of her pregnancy, or that her employment was terminated because of it.
Of significance, in the current matter, in its Response, the respondent made particular moment of the fact that the applicant’s Form 2 was stamped on 20 April 2021. In this context it opposed the making of any interlocutory orders sought by the applicant.
Accordingly, it is clear to me that prior to the first mention of the matter, which was on 22 June 2021, the issue of extension of time, was a live one. In these circumstances, on 22 June 2021, the following orders were made:
That the Applicant file an Application for an extension of time in which to proceed together with an Affidavit within 28 days of today’s date.
That the Respondent file a Response to that Application together with any relevant Affidavits in support thereof.
Further consideration of the matter is adjourned to 10 August 2021 at 12.00noon for interim argument NOTING the proceedings will be conducted face to face.
Those advising Ms Dallisson did not comply with these orders, and no application for extension was filed as directed, although on the face of her application there was an application for such an order but no affidavit evidence explaining the delay.
In these circumstances, Ms Thomas, on the day prior to that scheduled for the interim hearing, forwarded a proposed order, to Ms Davidson, the solicitor for the respondent, to which Ms Davidson responded as follows:
·The Application was filed out of time;
·The order of 22 June 2021 was unequivocal and required the filing of an application for leave to file out of time and a supporting Affidavit;
·This order had not been complied with;
·Ms Davidson had corresponded Ms Thomas and informed her that on 10 August 2021 she had been instructed to seek the dismissal of the application and for an award of costs;
·Ms Thomas had responded to this email indicating that she had not been aware of the order, could not access it and thought the hearing scheduled was to take place on 10 September 2021.
The day prior to the hearing, Ms Thomas emailed an Application in a Case and a supporting Affidavit, by which she sought an extension of time on behalf of her client, as had been originally directed but obviously late.
As I recall, on 10 August 2021, counsel for the respondent reaffirmed its objection to the extension of time and expressed dismay that no evidence had been provided to support the Application.
At this stage, there appears to be little facility for the parties themselves to work through the issues relating to the time limit matter in a consensual manner, which focussed on the likely outcome of the matter, and with a view to limiting costs.
In these circumstances, the following orders were made on 10 August 2021:
The Applicant file and serve an Affidavit within 14 days of today’s date.
The Respondent file and serve an Affidavit in response within 28 days of today’s date.
Further consideration of the matter is adjourned to 28 September 2021 at 10.00am for interim argument regarding the question of extension of time NOTING the proceedings will be conducted face to face however should any party not be able to attend at Court, leave is granted to appear by MS Teams.
Each parties’ costs for today are reserved.[4]
[4] See orders of Judge Brown dated 12 August 2021.
On 30 August 2021, Ms Thomas filed an Application where she sought the following orders:
That the Applicant is granted an extension of time to file her Application – Fair Work Division form dated 19 April 2021 and Form 2 Claim under the Fair Work Act 2009 alleging dismissal in contravention of a general protection dated 9 April 2021 to 20 April 2021.[5]
That there be no order as to costs with respect to this Application in a Case.
[5] See Application filed on behalf of Alicia Kate Dallisson on 30 August 2021.
This Application was supported by an Affidavit, which she had deposed herself. In her Affidavit, the matters deposed by Ms Thomas, can be summarised as follows:
·She had been instructed by Ms Dallisson to lodge proceedings in the Fair Work Commission in early-February 2021;
·As a consequence, the parties had participated in a Conciliation Conference, at the Commission, on 11 March 2021, which was attended by both Ms Thomas and Ms Davidson;
·The Conciliation Conference did not resolve the dispute between the parties concerned and a section 368(3) certificate was issued on 31 March 2021;
·She was instructed by Ms Dallisson to institute proceedings in this Court shortly afterwards;
·She had no previous professional experience of conducting a matter either in the Federal Court or the Federal Circuit Court (as the Court then was) and had never used either Court’s electronic filing system, known as the Commonwealth Courts Portal;
·On 13 April 2021, she attempted to file the Application electronically;
·By necessary implication, she was unaware that a fee attached to the application;
·The Application was marked pending and was accompanied by an email in the following terms:
Reason for Pending: Amend Document Type to Form 2 and please uplaod [sic] additional document ‘Application – Fair Work Division’. This extra document will have the Document Type ‘Application – FW Div (filed with Form 2). This ensures the correct fee is generated for filing.
If the reason for marking this lodgment as Pending is to schedule a listing, or to obtain additional information from within the Court, we will process the lodgment as soon as possible.
If the reason for marking this lodgment Pending requires action from you, please use the link below to view and edit your lodgment.
·Ms Thomas became aware that her Application had not been formally filed, when she telephoned the Court Registry on 16 April 2021;
·At this stage, she became aware that there was a fee attached to the filing of the Application;
·Between 13 April and 20 April 2021 she experienced difficulties in operating the eLodge Portal and paying the required fee;
·On 20 April 2021 she recommenced the filing process, which generated a new filing date of 20 April 2021 rather than that of 13 April 2021.
In all these circumstances, Ms Thomas deposes as follows:
In starting the filing process from the beginning on 20 April 2021, this generated a new filing date of 20 April 2021 and not the original filing date of 13 April 2021.
On 20 April 2021, prior to making the successful application, I telephoned the Court Registry and raised the point concerning the filing date being changed from 13 April 2021 to 20 April 2021. I was verbally advised by the Registry personnel that the date change was due to limitations of the e-system and for new users there are sometimes issues that are experienced similar to the issues that I had encountered. During this discussion, the Registry personnel advised me to make an interlocutory application seeking an extension of time for the short delay in having the documents accepted for filing through the portal. The Registry personnel said to me to include words to the effect of "the originating application, due to e-lodgement system limitations could not be lodged" as the reason for seeking the extension of time.
Ms Davidson has responded to this Application with her own Affidavit filed on 7 September 2021. It is an Affidavit of some 118 pages. In essence, it is her position that the dilatory conduct of Ms Thomas has put her client to considerable expense, particularly in respect of the wasted hearing of 10 August 2021, which should be remedied by an order for costs.
As I understand it, the amount sought is $7,429.50. Essentially, it is Ms Davidson’s position that if Ms Thomas had carefully read the email sent to her, by the Federal Court Registry on 13 April 2020, none of this procedural imbroglio would have been necessary, as the problem arising could have been easily rectified.
Whether this assertion is true, I am not in a position to say. However, I am gravely concerned that this whole situation has become Kafkaesque in its implications, and what should have been an ordinary and commonplace administrative problem has been blown out of proportion. In my view, it demonstrates the worst aspect of the adversarial process.
In this context, in her Affidavit, Ms Davidson has not alluded to the central issue to these proceedings, namely whether her client will accede to the extension of time application. That concession was made, on the respondent’s behalf, by counsel briefed to appear on the hearing scheduled for 28 September 2021, Mr Mackie.
THE LEGAL PROVISIONS APPLICABLE
Section 370(a)(ii) of the FWA provides that an application made pursuant to the general protection provisions of the FWA, which requires a certificate under section 368(3), must be made within fourteen days after the certificate is issued, or within such period as a court allows on an application made during or after those fourteen days.
The section contains a note in the following terms:
For the purposes of subparagraph (a)(ii), in Brodie‑Hanns v MTV Publishing Ltd (1995) 67 IR 298, the Industrial Relations Court of Australia set down principles relating to the exercise of its discretion under a similarly worded provision of the Industrial Relations Act 1988.
In Clarke v Service to Young Council Incorporated,[6] White J described the note as “a useful reference by Parliament, i.e. to assist readers in identifying matters which may bear on the exercise of a court’s discretion under the provision.” Both parties in the current matter acknowledge that what was said in Brodie-Hannsv MTV Publishing Ltd (‘Brodie-Hanns’) is the starting point for the Court’s deliberations.[7]
[6] See Clarke v Service to Young Council Incorporated [2013] FCA 1018 at [5] (White J).
[7] Brodie‑Hanns v MTV Publishing Ltd (1995) 67 IR 298.
In Brodie-Hanns, Marshall J summarised the principles applicable to a grant of an extension as follows:
1.Special circumstances are not necessary but the Court must be positively satisfied that the prescribed period should be extended. The prima facie position is that the time limit should be complied with unless there is an acceptable explanation of the delay which makes it equitable to so extend.
2.Action taken by the applicant to contest the termination, other than applying under the Act, will be relevant. It will show that the decision to terminate is actively contested. It may favour the granting of an extension of time.
3.Prejudice to the respondent including prejudice caused by delay will go against the granting of an extension of time.
4.The mere absence of prejudice to the respondent is an insufficient basis to grant an extension of time.
5.The merits of the substantive application may be taken into account in determining whether to grant an extension of time.
6.Consideration of fairness as between the applicant and other persons in a like position are relevant to the exercise of the Court’s discretion.[8]
[8] Ibid 299-300 (Marshall J).
In Hunter Valley Developments Pty Ltd v Cohen,[9] Wilcox J provided a non-exhaustive list of factors relevant to whether an extension of time ought to be granted. These can be summarised as follows:
·The extent of the delay;
·The explanation for the delay;
·Any prejudice a respondent might suffer because of the delay; and
·The merits of the proposed application.[10]
[9] Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344.
[10] Ibid 348-350 (Wilcox J).
These considerations must be viewed in the light of High Court authority which emphasises the importance of limitation periods. They represent the ‘legislature’s judgment that the welfare of society is best served by causes of action being litigated within the limitation period.’[11] As such, the Court cannot ignore limitation periods created by the legislature, but at the same time it cannot ignore the interests of justice.
[11] See Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, 553 (McHugh J).
As is self-apparent, the legislature has fixed different limitation periods in respect of different cases. In this particular matter, it is obviously germane that the applicable limitation period is a short one.
In Clarke v Service to Young Council Incorporated,[12] White J explained the rationale for the short period of time which had been allocated for proceedings, such as the current one, to be instituted. It relates to practical employment difficulties which arise if a particular applicant seeks to be reinstated into the position from which they have been dismissed. He said as follows:
[T]he longer the period from a termination, the more difficult reinstatement of employment will be. The relatively short limitation period of 14 days may be understood as a legislative recognition of that difficulty. The Parliament intends that applications under s 371 should be brought promptly so that the practical difficulties which an order for reinstatement can occasion may be minimised. In my opinion, this is an important consideration in relation to applications of the present kind.”[13]
This is not the case in the present matter. Ms Dallisson does not seek reinstatement. She seeks the imposition of a monetary penalty and compensation.
[12] See Clarke v Service to Young Council Incorporated [2013] FCA 1018.
[13] Ibid at [8] (White J).
The legislation recognises that individual considerations of justice dictate that the Court should have a discretion to ameliorate the limitation period, in appropriate circumstances, where the interests of justice require it. That is why the Court is conferred with the power to extend time.
The granting of the extension is a discretionary exercise. Sullivan J outlines in Milas v GM Holden Limited that ‘the discretion is unfettered but it is to be exercised judicially by identifying matters relevant to the discretion in the particular case and weighing those matters’ against one another.[14]
[14] See Milas v GM Holden Limited [2015] FCCA 1311 at [15] (Judge Sullivan).
In general terms, the matters identified by Marshall J in Brodie-Hanns, as noted in the applicable section, provide the appropriate matters for reference, but those are not the only matters, given the requirement that the Court should provide individualised justice, as each case requires.
In the current matter, there seems to be no controversy that no default or criticism can attach to Ms Dallisson, who relied upon Ms Thomas to lodge her Application to the Court within time and who provided the necessary instructions required promptly. Accordingly, as Ms Thomas impliedly concedes, this was a case of what lawyers refer to as a representative error.
In Clarke v Ringwood Private Hospital,[15] the Australian Industrial Relations Commission addressed issues referrable to representative error, as an explanation for delay in extension of time cases, in the manner:
•Depending on the particular circumstances, representative error may be a significant reason to extend time;
•A distinction should be drawn between delay properly apportioned to an applicant’s representative, where the applicant is blameless, and delay occasioned by the conduct of the applicant;
•As such, the conduct of any applicant concerned is the central consideration in whether the error of a representative provides an accept explanation for the delay in filing an application.[16]
[15] See Clarke v Ringwood Private Hospital (1997) 74 IR 413.
[16] Ibid 418-420 (Ross V-P, Drake D-P and Commissioner Deegan).
In these circumstances, the Australian Industrial Relations Commission noted the distinction between a case in which the applicant left the matter in the hands of their representative and thereafter took no steps to enquire as to its progress and one in which an applicant gave clear instructions to their representative to lodge an Application and the representative failed to carry out those instructions, through no fault of the applicant concerned.
DISCUSSION
In the present matter, the delay on the face of the record is an extremely modest one, it is one of days rather than weeks. More significantly, in my view, there is a more than adequate explanation for the delay.
This delay can be summarised as follows - a neophyte solicitor was struggling with an electronic and administrative system, with which she was unfamiliar, and was in a jurisdiction which was hitherto foreign to her. She did not read a somewhat, in my view, obscurely expressed email, with sufficient rigour.
The respondent does not contend that it will suffer real prejudice as a consequence of the delay. It remains in the same position as it would have been if the proceedings were commenced within time. However, as Marshall J pointed out in Brodie-Hanns, ‘the mere absence of such prejudice cannot be regarded as a sufficient basis to grant the extension sought’.[17]
[17] Brodie‑Hanns v MTV Publishing Ltd (1995) 67 IR 298, 299-300 (Marshall J).
The prejudice said to have been incurred by the respondent relates to the aborted hearing of 10 August 2021, which has necessitated two hearings. In my view, to a large extent, this has been because the respondent has been unwilling to make any concessions, in the light of what should have been a largely foregone conclusion. A point was taken because it could be taken.
It is difficult at this juncture to assess the overall merits of Ms Dallisson’s Application. Two things appear unchallenged, she was pregnant and she was dismissed. No doubt, the case will turn of evidentiary issues as to what level of causation exists between these two occurrences. The onus will lie on the relevant decision maker concerned to explain why the termination decision was made, given the reverse onus provisions contained in section 361 of the FWA.
Accordingly, at this juncture, the applicant’s case cannot be regarded as being one that is plainly hopeless or one in which there is a level of axiomatic weakness, which is germane to the extension of time issue. There is an evidentiary matrix on which to found the claim.
At the end of the day, the Court must weigh considerations of fairness, as between the parties themselves, whilst taking into account the public interest that limitation periods should not be arbitrarily dismissed. In this context, in my view, it is important to note that if Ms Dallisson is not granted an extension, it will have the effect of extinguishing her claim.
It is also, in my view, in the public interest, that, if Ms Dallisson was dismissed because she was pregnant, that the issue be properly litigated, and the principle underlying the industrial safety net provided by the FWA be publically ventilated. I must not lose sight of the fact that the FWA is beneficial legislation.
In all the circumstances of this case, particularly the fact that the delay in question was extremely brief and cannot be tied to any neglect of default on Ms Dallisson’s part, in my view, it would be an affront to the fair administration of justice, and to the public interest if Ms Dallisson was not granted the extension, which she seeks. In my view, this state of affairs should have been one readily apparent, to all concerned, at a much earlier stage of proceedings.
COSTS
Pursuant to section 570(1) of the FWA, the Court has a discretion to order the payment of a party’s costs, in respect of proceedings under the Act, but only if satisfied of the matters contained in section 570(2), which reads as follows:
(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 Court has a wide discretion as to the calculation of costs. Pursuant to rule 22.02 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), the Court may:
•Set the amount of the costs;
•Set the method by which the costs to be calculated;
•Refer the costs for taxation;
•Set a time for the payment of the costs concerned.
In addition, pursuant to the provisions of rule 22.06, the Court has a discretion to award costs against a lawyer if such a lawyer has caused costs to be incurred by another party or to be thrown away because of undue delay, negligence, improper conduct or other misconduct or default.
Pursuant to rule 22.06(2), a lawyer may be in default if the proceedings do not proceed conveniently because of a failure to do an act necessary for the hearing to proceed, which can include a failure to file or lodge a relevant document.
The Full Court of the Federal Court explained the meaning and effect of section 570 in Australian Workers’ Union v Leighton Contractors Pty Ltd (No 2),[18] which can be summarised in the following terms:
•The purpose or policy of the section is to free parties from the risk of having to pay their opponents costs in matters arising under the Act, while at the same time protecting those parties who are forced to defend proceedings that have been instituted vexatiously or without reasonable cause;
•It follows from the protection offered by s 570(2) that a person will rarely be ordered to pay the costs of their proceedings. But it is not necessary to prove that there are exceptional circumstances warranting the making of an order.[19]
[18] See Australian Workers’ Union v Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428.
[19] Ibid 430 [7] (Dowsett, McKerracher and Katzmann JJ).
In the current matter, there is no issue concerning whether Ms Dallisson has commenced proceedings without any reasonable prospects of success. The case is far away from that particular point.
The issue of costs relates to a relatively simple point, which occurred at an early stage of proceedings and which, in my view, has garnered more resources than are commensurate with the complexity of issues arising from it. Those advising MK2 knew, or should have known there had been, in the common parlance, an administrative stuff up which, in my experience, can occur in even the most well run of legal practices from time to time.
There are, in my view, sometimes dangers implicit in playing legal hard ball. Mistakes happen. In my assessment, the mistakes made by Ms Thomas cannot be characterised as deserving censure in all the circumstances of the particular case concerned, particularly given the moment of the litigation concerned for both Ms Dallisson and the community generally.
In CFMEU v Clarke,[20] the Full Court of the Federal Court observed as follows:
…Indeed, whilst courts should use the discretion … to ensure that parties to litigation arising from the … Act do not engage in unreasonable acts and omissions which put the other party to undue expense, they should also be careful not to exercise the discretion with too much haste, given that such haste may discourage parties, for fear of an adverse costs order, from pursuing litigation under the … Act in the manner in which they deem best.[21]
[20] See CFMEU v Clarke (2008) 170 FCR 574.
[21] Ibid 582 [29] (Tamberlin, Gyles and Gilmour JJ).
This passage was subject to comment by Bromberg J in Saxena v PPF Asset Management Ltd,[22] in which His Honour said as follows:
With great respect to the observations made in CFMEU v Clark, I wholeheartedly agree that this Court ought be very careful indeed to exercise the discretion provided by section 570(2) and should not do so other than in a clear case. The limited discretion conferred on the Court by that subsection ought not become the basis for arguments about costs in relation to any and every transgression in the conduct of a case.[23]
[22] Saxena v PPF Asset Management Ltd [2011] FCA 395.
[23] Ibid at [6] (Bromberg J).
No blame or criticism can attach to Ms Dallisson. She promptly instructed Ms Thomas she wished to proceed with an application to court following the failed conference at the Commission. Nothing relating to her behaviour can be characterised as an unreasonable act or omission. It would not, in my view, be a fair exercise of the discretion to penalise her.
MK2 have not asserted that Ms Dallisson’s application is in any way vexatiously motivated, although it challenges, as it is entitled to do, some of the factual assertions on which it is based. In my view, her personal conduct does not fall within the ambit of section 570.
The next issue is whether Ms Thomas’ conduct, from the date of the Commission conference onwards can be described as being characterised as an unreasonable action or omission. The evidence available to me indicates that she did indeed attempt to action her client’s instruction, and prepared her application promptly.
Thereafter, what followed, is a situation which, in my view, can be properly characterised as a comedy of errors, none of them particularly serious in their import, and which could have easily been put to rights with little expense and no prejudice to the respondent. This would not be a proper case in which to exercise the limited discretion provided by section 570 against Ms Thomas personally.
I acknowledge that the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) does allow costs to be award against a solicitor for what has been characterised as a representative error. However, certain provisos attach to the exercise of that discretion. In particular, rule 22.06(5) requires a solicitor, who may be subject to such an order, to be given a reasonable opportunity to be heard in respect of it.
In this matter, it was only belatedly, during the hearing itself, where the concession was offered and that the extension would no longer be opposed. More significantly, the lengthy written submissions of Mr Mackie, in which the focus of the hearing shifted to costs, were provided only on the morning of the hearing, and after I had commenced my daily list.
In all the circumstances concerned, I will grant the extension sought and refer the parties to a court based alternative dispute resolution process, which both counsel agreed was the appropriate next step.[24] I decline to make any order in respect of costs.
[24] See Federal Circuit and Family Court of Australia Act 2021 (Cth) s 169; Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) Div 23.1 and 23.2.
For these reasons, the orders of the Court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding seventy-two (72) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Brown. Associate:
Dated: 5 October 2021
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