Diocese of Lismore T/A Diocese of Lismore v Mr James Mott
[2016] FWCFB 8170
•30 NOVEMBER 2016
| [2016] FWCFB 8170 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
v
Mr James Mott
(C2016/5937)
VICE PRESIDENT CATANZARITI | SYDNEY, 30 NOVEMBER 2016 |
Appeal against decision [2016] FWC 6385 of Commissioner Riordan at Sydney on 14 September 2016 in matter number U2016/4035.
[1] Mr James Mott (‘Mr Mott’) was employed by The Diocese of Lismore (‘The Diocese’) from 12 November 2007 until his resignation on 6 January 2016. On 22 January 2016, Mr Mott lodged an application to the Fair Work Commission (‘FWC’) for an unfair dismissal remedy pursuant to section 394 of the Fair Work Act 2009 (Cth)(‘the Act’). In his application, Mr Mott claimed that he was forced to resign due to a restructure of the IT Department that was introduced by The Diocese.
[2] A hearing was scheduled to take place before Commissioner Riordan on 12 and 13 July 2016. However, on 11 July 2016, Mr Mott informed Commissioner Riordan’s chambers of his decision to withdraw his unfair dismissal application. On 22 July 2016, The Diocese lodged an application for costs, totalling $55,793.93 in accordance with sections 400A and 611 of the Act.
[3] On 14 September 2016, Commissioner Riordan issued a Decision 1 (‘Decision’) in which he dismissed The Diocese’s application for costs. The Diocese has applied for permission to appeal and appealed against the Decision. The issue before us is whether permission to appeal should be granted. By consent of the parties, we have decided the issue of permission to appeal on the papers. The reasons for our decision are provided below.
The Decision
[4] The Commissioner stated that pursuant to section 611 of the Act, The Diocese’s application for costs could succeed only if Mr Mott’s unfair dismissal application was made:
● Vexatiously or without reasonable cause (section 611(2)(a) of the Act); or
● In circumstances where it should have been apparent to Mr Mott that his unfair dismissal application had no reasonable prospect of success (section 611(2)(b) of the Act).
[5] The Commissioner made the following findings in relation to section 611 of the Act:
“[42] I have taken into account that Mr Mott is an IT specialist, not an expert in industrial/workplace law. I have taken into account that Mr Mott sought legal advice from a highly experienced legal practitioner. I have taken into account that Mr Mott’s legal advice was that he had an arguable case in relation to the concept of constructive dismissal.
[43] Based on the obiter in Keep, I do not regard Mr Mott’s application as being manifestly groundless or without prospect of success. In fact, having read all of the materials that had been submitted before the hearing date, I was of the view that Mr Mott had a difficult but arguable case.
…
[46] Following Baker, I am required to consider two issues. Firstly, did Mr Mott’s application have a reasonable prospect of success and secondly was Mr Mott’s application manifestly untenable or groundless or so lacking in merit or substance as to be not reasonable arguable.
[47] In PN43 above, I indicated that having viewed all of the materials that had been
submitted that I was of the view that Mr Mott had a difficult but arguable case. An obvious issue which would have required a great deal of qualification was how The Diocese could suggest that a payment of $12,000 (gross) could be regarded as compensation for the loss of a company provided vehicle. Such a proposition appears “light” in the circumstances. Clearly the cross examination of the witnesses would have proven pivotal. As a result of my view that Mr Mott had an arguable case, I cannot find that Mr Mott’s application was manifestly untenable or lacking in merit. I have taken this into account.”
[6] Section 400A of the Act requires a finding that Mr Mott caused costs to be incurred by The Diocese by some unreasonable act or omission on the part of Mr Mott. The Commissioner made the following findings in relation to section 400A of the Act:
“[50] Based on the obiter in Stagno, I am drawn to the time at which Mr Mott believed that his case had become unlikely to succeed. This occurred on the day before the scheduled hearing when Mr Mott explained to his Counsel that one of his key corroborating witnesses, Mr Atkins, was not available to give evidence. The advice from his legal team at this point was, that the jurisdictional issue that needed to be determined had become very difficult. Appropriately, Mr Mott discontinued the matter that afternoon. I have taken this into account.
[51] I have also taken into account the unrefuted accusation from Mr Mott that The Diocese, after agreeing to participate in a telephone conciliation conference under the auspices of Senior Deputy President Drake, refused to put an offer to settle the matter. Such deliberate inactivity was clearly a waste of time and money for the parties and the FWC. Such behaviour cannot be condoned, nor should it be repeated. If The Diocese simply wanted to go to hearing then they should not have agreed to participate in the conciliation before Her Honour.
…
[54] Mr Mott did not deliberately cause The Diocese to incur additional costs. The decision to employ legal representation was one made by The Diocese. The decision to not participate in good faith during the second conciliation was made by The Diocese. The decision to have Counsel attend the day before the hearing was, once again, made by The Diocese. Appropriately, Mr Mott withdrew his application based on the advice that he received from his legal advisors the day before the hearing. I find that Mr Mott did not participate in an unreasonable act or omission.”
[7] In light of the above, the Commissioner dismissed the costs application. 2
Permission to appeal principles
[8] This appeal is one to which section 400 of the Act applies. 3 Section 400 provides:
“(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a decision made by the FWC under this Part unless the FWC considers that it is in the public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation to a matter arising under this Part can only, to the extent that it is an appeal on a question of fact, be made on the ground that the decision involved a significant error of fact.”
[9] In the Federal Court Full Court decision in Coal & Allied Mining Services Pty Ltd v Lawler and others, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under section 400 as “a stringent one”. 4 The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment5. In GlaxoSmithKline Australia Pty Ltd v Makin (‘GlaxoSmithKline’) a Full Bench of the Commission identified some of the considerations that may attract the public interest:
“... the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters.” 6
[10] It will rarely be appropriate to grant permission to appeal unless an arguable case of appealable error is demonstrated. This is so because an appeal cannot succeed in the absence of appealable error. 7 However, the fact that the Member at first instance made an error is not necessarily a sufficient basis for the grant of permission to appeal.8
Grounds of Appeal
[11] The Diocese submitted that permission to appeal should be granted on the basis that it is in the public interest that the appeal be allowed. The Diocese also contended that the Decision involves significant errors of fact.
Public Interest
[12] The Diocese contended that it is in the public interest that the appeal be allowed because it raises issues of importance and general application, particularly involving:
- The use of, and reliance that may be placed upon, Statutory Declarations. Specifically, The Diocese asserted that the Commissioner disregarded Mr Mott’s own sworn evidence in his Statutory Declaration that, were more money to become forthcoming, he would not have resigned. The Diocese submits that this error went to the heart of the jurisdictional consideration required of the Commissioner in the application of sections 400A and 611. Namely, on the basis that Mr Mott would never have been able to establish that there was some action on the part of The Diocese which was intended to bring the employment relationship to an end or which has the probable result of bringing the employment relationship to an end;
- The proper application of the provisions of sections 400A and 611 of the Act; and
- The proper application of sections 398(2) and 592 of the Act. Specifically, The Diocese asserted that by relying on the alleged events that occurred in private conciliation proceedings, the Commissioner disregarded the proper application of those sections.
[13] The Diocese submitted that it is also in the public interest that the appeal be allowed on the basis that the Decision results in injustice and is counter-intuitive.
Alleged Significant Errors of Fact
[14] The Diocese submitted that the erroneous approach of the Commissioner resulted from, and involved, numerous significant errors of fact, including:
- Referring to and relying upon the alleged conduct of the parties in conciliation proceedings, in a manner that disregards sections 398(2) and 592 of the Act;
- Assessing, without the slightest modicum of evidence, that an assessment of value for a car at $12,000.00 per annum was “light” in the circumstances;
- That Mr Atkins was a “key corroborating witness”;
- That Mr Mott incurred substantial legal costs, when there was no evidence of his costs; and
- That the Appellant could somehow be “embarrassed”, as that term is used in the concept of an assessment of vexation, by the level of their legal fees, or that the level of those fees in relation to the remedy sought was somehow relevant.
Consideration
[15] We have fully considered The Diocese’s submissions and the relevant authorities relating to the FWC’s discretion to award costs and grant permission to appeal. The authorities prescribe that the FWC’s discretion to award costs ‘should be exercised with caution and only in a clear case.’ 9 In our view, the Commissioner was cautious in his application of sections 400A and 611 of the Act in a manner that was consistent with these authorities. The Commissioner followed the authorities relating to the FWC’s discretion to award costs in an orthodox manner. Applying GlaxoSmithKline, the Commissioner’s conclusion that Mr Mott did not act vexatiously, without reasonable cause, or in circumstances where it should have been reasonably apparent to him that he had no reasonable prospects of success was reached in a manner that was neither counter intuitive nor ‘disharmonious when compared with other recent decisions dealing with similar matters.’10
[16] Furthermore, it does not follow that Mr Mott engaged in an unreasonable act or omission by making and continuing his unfair dismissal application in circumstances where his legal advice was that he had an arguable case in relation to the concept of constructive dismissal. As to the discontinuance of his application, on the weekend before the hearing Mr Mott became aware for the first time that one of his witnesses would not be able to give evidence at the hearing. The witness was being called to corroborate Mr Mott’s version of what was said at a meeting in August 2015 when the restructure and its impact was communicated to the affected employees. Mr Mott sought advice from his counsel about this issue on the day before the hearing. Based on that advice, Mr Mott discontinued his application that afternoon. The Commissioner considered these matters and found that Mr Mott’s discontinuance of his application at that time was appropriate. 11 That was the foundation for the Commissioner’s rejection of The Diocese’s argument that Mr Mott had acted unreasonably by discontinuing the matter on the day before the hearing. We are satisfied that the there is no arguable appealable error in connection with the Commissioner’s finding that Mr Mott did not engage in any unreasonable act or omission which caused The Diocese to incur costs.
[17] In considering whether Mr Mott made his unfair dismissal application vexatiously, the Commissioner found there was no evidence to support the contention that Mr Mott’s predominant purpose in instigating the proceeding was to harass or embarrass The Diocese or the Catholic Church. 12 After making that finding the Commissioner noted that The Diocese may have been embarrassed by spending a significant amount in legal fees in its defence of Mr Mott’s claim. Although it may be arguable that the Commissioner should not have had regard to the potential for The Diocese to be embarrassed by its own legal costs, it is apparent from paragraph [52] of the Decision that the Commissioner dismissed the contention that Mr Mott made his unfair dismissal application vexatiously on the basis that there was no evidence to support the contention. We are satisfied there is no arguable appealable error in relation to the Commissioner’s finding that there was no evidence to support the claim of vexatiousness on the part of Mr Mott. For that reason, it would not be in the public interest to grant permission to appeal in connection with the Commissioner’s comments about any embarrassment The Diocese may have felt in connection with its own legal costs.
[18] The Commissioner also made comment about The Diocese’s decision to agree to participate in further conciliation even though it did not make a settlement offer at that conciliation conference. 13 The Commissioner was made aware by Mr Mott that there was no offer of settlement by The Diocese at the conciliation conference. It was only in this context that any details of conciliation were referred to by the Commissioner. It may be arguable, as The Diocese contends in its submissions, that the Commissioner should not have given weight to what The Diocese did or did not do in private conciliation. However, because the costs application made by The Diocese was focused on Mr Mott’s conduct, purpose and beliefs, not any conduct on the part of The Diocese, any conduct on the part of The Diocese at a conciliation conference could not logically have had any bearing on the outcome of the application for costs against Mr Mott. Further, we are satisfied that the decision at first instance does not manifest an injustice, nor is the result counter intuitive. In these circumstances, we are satisfied that the Commissioner’s consideration of the alleged events that took place in the conciliation does not provide a sufficient basis for us to find that granting permission to appeal would be in the public interest.
[19] The Commissioner, ‘having read all the materials that had been submitted before the hearing date’, reached the conclusion that Mr Mott had an arguable case. 14 Those materials included Mr Mott’s Statutory Declarations, in which Mr Mott explained the impact of the unilateral changes sought to be made by The Diocese to his terms and conditions of employment. This evidence was plainly relevant to Mr Mott’s argument that he was constructively dismissed.15 The Commissioner considered this issue in the context of The Diocese’s contention that Mr Mott would never have been able to establish a constructive dismissal or forced resignation by reason of his indication that he would not have resigned if he had been offered more money. In that context, the Commissioner reached the conclusion that Mr Mott had a difficult but arguable case.16 We are satisfied that there is no arguable appealable error in relation to the Commissioner’s conclusion that Mr Mott had an arguable case. Further, we are not satisfied that the Commissioner’s consideration of the Statutory Declarations gives rise to an arguable appealable error or otherwise enlivens the public interest.
[20] We are satisfied that there is no arguable appealable error in any other part of the Decision.
[21] It is clear that The Diocese disagrees with the conclusions reached by the Commissioner and asserts that there are several errors of fact in the Commissioner’s Decision. However, The Diocese’s disagreement and allegations of errors cannot be the basis of a successful permission to appeal application.
[22] Pursuant to section 400(1) of the Act, the public interest must be enlivened for permission to appeal to be granted. In paragraphs [15] – [21] of this decision, we have demonstrated why we are of the view that the public interest is not enlivened in this case. In these circumstances, and having regard to section 400(1) of the Act, we are not satisfied that permission to appeal should be granted.
Conclusion
[23] Permission to appeal is not granted.
[24] The appeal is dismissed.
VICE PRESIDENT
1 [2016] FWC 6385
2 Ibid 55.
3 See Australia Postal Corporation v Gorman [2011] FCA 975 at [37]
4 (2011) 192 FCR 78 at [43]
5 O’Sullivan v Farrer (1989) 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch (2011) 85 ALJR 398 at [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty Ltd v Lawler and others (2011) 192 FCR 78 at [44] -[46]
6 [2010] FWAFB 5343 at [27], 197 IR 266
7 Wan v AIRC (2001) 116 FCR 481 at [30]
8 GlaxoSmithKline Australia Pty Ltd v Makin[2010] FWAFB 5343 at [26]-[27], 197 IR 266; Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/Warkworth[2010] FWAFB 10089 at [28], 202 IR 288, affirmed on judicial review in Coal & Allied Mining Services Pty Ltd v Lawler (2011) 192 FCR 78; NSW Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663 at [28]
9 Keep v Performance Automobilies Pty Ltd [2015] FWCFB 1956.
10 [2010] FWAFB 5343 at [27], 197 IR 266
11 The Decision, para [50]
12 The Decision, para [39] and [52]
13 The Decision, para [51]
14 The Decision, para [43]
15 AB 578 at [44]
16 The Decision, para [47]
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