Direct Freight Express Pty Ltd v King
[2015] FCCA 1066
•7 May 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| DIRECT FREIGHT EXPRESS PTY LTD v KING | [2015] FCCA 1066 |
| Catchwords: INDUSTRIAL LAW – Application for costs pursuant to s.570 Fair Work Act 2009 on grounds of unreasonable act or omission – costs awarded. |
| Legislation: Fair Work Act 2009, s.570(2)(b), ss.340, 343, 344, 345, 351 Federal Circuit Court Rules 2001, r.21.02(1) |
| Aitken v Virgin Australia Airlines and Vandeven v Virgin Australia Airlines (No.2) (Vandeven) [ 2013] FCCA 2031 Cugura v Frankston City Council (No.2) [2012] FMCA 530 |
| Applicant: | DIRECT FREIGHT EXPRESS PTY LTD |
| Respondent: | ANTHONY DIMITRI KING |
| File Number: | MLG 1004 of 2013 |
| Judgment of: | Judge Jones |
| Hearing date: | 27 March 2015 |
| Date of Last Submission: | 27 March 2015 |
| Delivered at: | Melbourne |
| Delivered on: | 7 May 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr Gisonda |
| Solicitors for the Applicant: | Mike Eden Corporate Solicitor |
| Solicitors for the Respondent: | Self Represented – no appearance |
ORDERS
The Respondent, Mr King, pay the applicant’s costs fixed in the amount of $4,486.50.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 1004 of 2013
| DIRECT FREIGHT EXPRESS PTY LTD |
Applicant
And
| ANTHONY DIMITRI KING |
Respondent
REASONS FOR JUDGMENT
Introduction
The applicant has applied pursuant to s.570(2)(b) of the Fair Work Act 2009 (“the Act”) for an order of costs against the respondent (Mr King) (“costs application”).
On 24 March 2014 I delivered judgment in relation to an application by the respondent on 5 July 2013 for relief on the grounds of contraventions of sections 340, 343, 344, 345 and 351 of the Act: King v Direct Freight (Aust) Pty Ltd (“King”) [2014] FCCA 524. I shall refer to this application by the phrase “general protections application.”
Mr King was wholly unsuccessful in his general protection application and an order was made on 24 March 2014 dismissing Mr King’s general protection application.
In accordance with rule 21.02(1) of the Federal Circuit Court Rules 2001 (“the Rules”), the applicant in this proceeding filed its costs application on 3 April 2014.
S.570 of the Act relevantly provides:
“(1) A party to proceedings (including an appeal) in a court (including a court of a State or Territory) exercising jurisdiction 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; or
(b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs; or
………
Mr King failed to attend at the hearing of the costs application. In light of the absence of any communication from Mr King to my Chambers that he would not be attending and the reasons for that, and having satisfied myself that the notice of hearing was sent to Mr King’s address on record (12 Croydon Avenue, Deer Park Victoria 3136 and also by email to [email protected]), I determined that the hearing should proceed. At the hearing the applicant provided the Court with a copy of its submissions in relation to its costs application. After the completion of the hearing, a copy of this submission was sent to Mr King.
Applicant’s submissions
The applicant argues that Mr King’s unreasonable acts or omissions caused it to incur costs and that, in the circumstances, costs should be awarded in accordance with the relevant schedule of the Rules.
The applicant relies on the following to support its costs application:
a)offers made by the applicant to Mr King to settle the dispute; and
b)the conduct of the applicant in running his case.
With respect to offers made by the applicant to Mr King, the applicant relies of the finding by this Court in its decision that upon terminating Mr King for serious misconduct and being advised by Mr King he intended to make an unfair dismissal application under the Act, Mr Alkan, the National Human Resources Advisor and the decision maker, offered to settle the matter by way of payment of his notice period. This was refused by Mr King who stated he wanted $50,000. This statement Mr King said was made in jest: [27] and [75].
The applicant also relies on the fact that on 5 February 2014 it made a formal offer of $7000 to the applicant in settlement of his general protections application.
In correspondence dated 5 February 2014 from Mr Alkan to Mr King and under the heading “Without prejudice save as to costs”, the applicant stated relevantly:[1]
“The purpose of this letter is to make you an offer of settlement.
This is our only offer of settlement.
In our view your application does not disclose a sustainable case against our company.
Indeed we believe the court may find that a cause of action is not established in your case at all.
Our offer is as follows:
1.That you will discontinue the proceedings MLG 1004/2013 and that both parties will sign a notice of discontinuance and cause it to be filed to effect the discontinuance;
2.That Direct Freight Express will pay you the amount of $7000 gross taxed according to employment termination payments taxation law;
3.That the payment referred to in paragraph 2 will be paid within 7 days of the discontinuance of the proceedings.
[1] Affidavit of Michael Alkan filed for fabric 2014, annexure MA1.
This offer is made on a “without prejudice save as to costs” basis.
In the company’s view your claim will fail. This offer is made for the purposes of seeking an early resolution to the proceeding and to avoid the cost and inconvenience of a trial.
The company reserves the right to produce this offer to the court in support of an application for an order against you to pay for its legal costs of the proceedings.”
Mr King did not respond to this offer. The applicant submits that the amount of $7,000.00 was the equivalent of 8 to 9 weeks pay and that the applicant’s notice period under his contract of employment was 2 weeks.
The applicant submits that the respondent’s conduct was unreasonable and contributed to its costs. The applicant points out that on the first day of hearing the applicant was late, thereby causing the hearing to proceed on the second day for only one hour. This would have been unnecessary had the applicant attended Court at the listed time.
The applicant also relies on the following extracts of the Court’s judgment in relation to the substantive proceedings as follows:[2]
[2] Application for Costs, Submissions of the Respondent, [14].
[14] Further, in the Reasons for Judgment, this Court said:
(a)when making submissions, the applicant made a serious allegation, completely unsubstantiated by his evidence, that the respondent effectively told its employees, sign employment agreement or there was no job (at paragraph [8]);
(b)the applicant made wide-ranging allegations that were not substantiated by way of probative evidence, and which indicated to the Court a tendency by the applicant to exaggerate and embellish his complaints against the respondent to make good his deep felt grievances about the way in which he was treated by the respondent (at paragraph [59]);
(c)the Applicant made no submissions as to how his action in conveying information provided by VicRoads constituted a workplace right (at paragraph [71]);
(d)the alleged contravention of s.344 of the Act was completely misconceived (at paragraph [78]);
(e)the basis upon which the applicant alleged the respondent breached s.351 of the Act was fatally flawed (at paragraph [84]).”
The applicant relies on the decision in Aitken v Virgin Australia Airlines and Vandeven v Virgin Australia Airlines (No.2) (Vandeven) [2013] FCCA 2031 at [31] for the proposition that costs can be awarded against the party for refusing a reasonable offer of settlement on the basis it constituted an “unreasonable act or omission, [which ] cause another party to the proceeding to incur costs in connection with the proceeding” and that it is open to the Court to consider without prejudice exchanges in determining this question.
The applicant submits that the rejection of the letter of offer dated February 2014 was an unreasonable act or omission that caused it to incur costs in connection with the proceeding. It further submits that the conduct of the applicant on 11 April 2013, his conduct at trial and the weaknesses of many of his claims each constitute a further relevant consideration which supports a conclusion that the applicant’s rejection of the offer was unreasonable and that costs ought follow.
Costs sought by Applicant
Consistent with the decision in Cugura v Frankston City Council (No.2) [2012] FMCA 530 at [57] the applicant seeks an order for costs in accordance with schedule 1 of the Rules applicable at the time the proceedings commenced as follows:[3]
“ – Item 13(c) – Full day daily hearing fee (for 17 February 2014) $1,994.00
– Item 13(b) – Half day daily hearing fee (for 18 February 2014) $997.00
– Item 12 – 50% Advocacy Loading (for 17 February 2014) $997.00
– Item 12 – 50% Advocacy Loading (for 17 February 2014) $498.50
– Item 7 – Preparation for final hearing of 2 day matter $8,998.00
[3] Ibid at [18].
Total: $13,484.50”
I note that during oral submissions the applicant conceded that the bulk of its preparation for the final hearing was likely to have been completed at the time the offer of settlement dated 5 February 2014 was made by the applicant to Mr King.
Consideration
In considering the application for costs pursuant to s.570, I have had regard to the fact that Mr King was self-represented and that the general rule with respect to proceedings under the Act are that each party bear their own costs.
Mr King was unsuccessful in his general protection application. The applicant alleged contraventions of various provisions of the Act. The alleged contraventions were summarised at [1] of the decision in the substantive matter as:
a)Contravention of s.340 of the Act because he exercised a workplace right; namely, a complaint or inquiry;
b)The respondent discriminated against him on the basis of his political opinion in contravention of s.351 of the Act;
c)The respondent contravened s.340 of the Act by breaching health and safety requirements;
d)The respondent took action against him with intent to coerce in contravention of s.343 of the Act;
e)The respondent exerted undue influence or undue pressure on him in contravention of s.344 of the Act;.
f)The respondent made a false or misleading representation in contravention of s.345 of the Act;
g)The respondent improperly withheld his entitlement to two weeks payment in lieu of notice; and
h)The respondent engaged in or allowed work place bullying.
In my decision I made some observations about the applicant as a witness in the proceedings: [4]
“The applicant presented as a somewhat defensive witness, unable to respond to questions asked of him in a direct manner, preferring to refer to matters which he believed supported his case. Part of the difficulty was that the applicant’s grievance, as it turns out having heard all the evidence, is in the manner he was treated on 10 April 2014 when he said he simply questioned how he was to logistically complete a scheduled truck run, together with the punishment that was meted out to him; namely, summary dismissal. He had grievances about the practices and procedures of the respondent and the way in which the respondent treated employees and he clearly wished to ventilate this during the course of the proceedings. His desire to cast the respondent in the worst light made him, in my opinion, a somewhat unreliable witness. For some reason not apparent at the time, when presented with a document, being an employment agreement between the applicant and the respondent, the applicant was very reluctant to acknowledge that the signature on the document was his signature. He prevaricated and only responded directly that it was his signature upon questions from the Court.[5] Later, when making submissions, the applicant made a serious allegation, completely unsubstantiated by his evidence, that the respondent effectively told its employees, sign employment agreement or there was no job. I formed the view that the applicant was an argumentative character single-mindedly focused on the correctness of his view point.”
[4] King at [8].
[5] Transcript of Proceedings, 17 February 2014, p.37 at [5] to [30]
With respect to Mr King’s allegation that the respondent (in the substantive proceedings) contravened section 340 because he exercised a workplace right, the respondent conceded the applicant had purported to exercise a workplace right on 10 April 2013 and that adverse action was taken against the applicant when he was dismissed on 11 April 2013. The question the Court was required to determine, in respect of this alleged contravention, was whether or not Mr King was dismissed for the reason or part of the reason that Mr King exercised a workplace right. Having found that the respondent did not dismiss Mr King for the reason or part of the reason that he exercised workplace right, this alleged contravention was dismissed [70].
Mr King’s allegation that the respondent contravened s.340 of the Act by breaching health and safety requirements was not the subject of any helpful evidence or submissions by Mr King. Consequently, this alleged contravention was dismissed [71].
The factual circumstances alleged by the applicant giving rise to the alleged contravention of s.343 did not, even on the applicant’s evidence, rise to the requirements necessary to satisfy the Court that Mr Alkan took or threatened to take any action with an “intent to coerce” Mr King. In pressing this allegation, Mr King relied on the offer made by Mr Alkan to settle the matter by way of resignation and two weeks pay in notice of lieu. In respect of this allegation I stated as follows (at [75]):
“The applicant alleges that Mr Alkan took action with the intent to coerce him into resigning (and presumably not exercise his right to initiate proceedings under workplace laws) by threatening that if he did not resign he would give him a bad reference making it difficult for the applicant to obtain employment and that he would not receive his entitlements. I accept Mr Alkan’s evidence as to the sequence of events. This is, that he informed the applicant that his employment had been dismissed summarily, the applicant then said that he would make an unfair dismissal application, whereupon Mr Alkan made an offer to the applicant involving resignation, two weeks’ pay and a deed of release. This offer was refused by the applicant. I take judicial notice of the fact that the elements of this offer; namely, resignation, payment of a sum of money and deed of release, are not uncommon in termination cases. It is manifestly apparent that the offer was not intended to and did not negate the applicant’s choice, indeed he refused it. There is no doubt Mr Alkan intended to dissuade the applicant from pursuing a remedy under relevant laws but, in any event, it cannot be said that such conduct, the making of offers to settle or avoid litigation is illegitimate.”
This alleged contravention was dismissed [76].
Mr King’s allegation that the respondent exerted undue influence or undue pressure on him in contravention of s.344 of the Act relied on the same factual circumstances as those he alleged gave rise to a contravention of s.343. I found “this alleged contravention is completely misconceived” [78] and dismissed it.
Mr King’s allegation that the respondent made a false or misleading representation in contravention of s.345 of the Act relied on the same factual circumstances as those he alleged gave rise to a contravention of s.343. This alleged contravention was dismissed.
Mr King’s allegation that the respondent discriminated against him on the basis of his political opinion in contravention of s.351 of the Act was in fact an allegation he was denied overtime hours because of internal politics at the respondent’s workplace. It likewise was dismissed.
It will be seen that, other than his alleged contravention of s.340 because he made a workplace complaint, Mr King’s alleged contraventions were largely misconceived. Even on his own evidence these other alleged contraventions were bound to be unsuccessful. I formed the view that in alleging the many contraventions, Mr King did so with little thought (even taking into account he was self represented) and with the view of ventilating his many grievances with the respondent.
In Vandeven, Judge Burnett observed that a number of authorities had considered s.570 of the Act and its predecessor s.824 Workplace Relations Act 1996 (Cth). Citing the decision of Barker J in Australian Licensed Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd(No 2) [2011] FCA 309 at [29], his Honour stated at [31]:
“…..The authorities dealing with those provisions have established that,
a)Costs can be awarded against a party for refusing a reasonable offer of settlement on the basis it constituted an “unreasonable act or omission, [which] caused another party to the proceeding to incur costs in connection with the proceeding”; and
b)It is open to the Court to consider without prejudice exchanges to determine whether rejection of a settlement offer amounts to an unreasonable act or omission by which a party caused another party to incur costs for the purposes of s.570 of the FW Act.”
(footnote omitted)
The offer by the applicant to Mr King comprised a payment of $7,000.00 and that Mr King resign. Although a modest amount it must be considered in context.
Mr King sought reinstatement, compensation and penalties in his claim. He did not specify the amount of compensation or penalties he sought in the event his claim was successful. Nor did he provide the Court with detailed evidence regarding his loss he suffered as a consequence of the termination of his employment. In submissions he said he no longer pursued reinstatement. He stated that he started working as a casual about two months after his dismissal and that he worked around 20 hours a week. He said he earned $700.00 a week when he was employed with the respondent.
I am satisfied that in the circumstances, the offer made by the applicant to Mr King on 5 February 2015 was a reasonable offer.
I am satisfied that the conduct engaged in by Mr King in pursuing the claims he did (other than the alleged contravention of s.340 on grounds he exercised a workplace right by making a complaint) together with his rejection of the offer of settlement by the applicant on 5 February 2014, constituted unreasonable acts or omission which caused the applicant to incur costs within the meaning of s.570(2)(b) of the Act.
I am satisfied that Mr King should be ordered to pay costs incurred by the applicant and that these costs should be in accordance with Schedule 1 of the Rules applicable at the time the proceedings commenced.
I am satisfied that the costs Mr King should be ordered to pay ought reflect those incurred by the applicant after the day upon which the offer the applicant made to Mr King closed. This was 12 February 2014. As the proceedings commenced 5 days later I would not include any costs for preparation for final hearing of a 2 day matter ( Item 7 of the Rules) on the basis this would substantially have been already undertaken. I am satisfied that I should otherwise award costs in accordance with Schedule 1 of the Rules as follows:
Item 13(c) Full daily hearing fee (17 February 2014) $1,994.00
Item 13 (b) Half daily hearing fee (18 February 2014) $997.00
Item 12 50% Advocacy Loading (17 February 2014) $997.00
Item 12 50% Advocacy Loading (18 February 2014) $498.50
________
Total $4,486.50
Accordingly I will order that Mr King pay the respondent’s costs in the amount of $4,486.50.
I certify that the preceding thirty-six (36) paragraphs are a true copy of the reasons for judgment of Judge Jones
Associate:
Date: 7 May 2015
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