Douglas Sims v Eastland Medical Systems Ltd
[2013] FWCFB 2042
•5 APRIL 2013
[2013] FWCFB 2042
The attached document replaces the document previously issued with the above code on 5 April 2013.
Paragraph [13]
Reference (x2) to Eastland Pty Ltd now reads “Eastland Medical Systems Ltd”
Denise Jelfs
Associate to SENIOR DEPUTY PRESIDENT O’CALLAGHAN
5 April 2013
[2013] FWCFB 2042 |
FAIR WORK COMMISSION |
DECISION |
Workplace Relations Act 1996
s.120 - Appeal to Full Bench
v
Eastland Medical Systems Ltd
(C2012/5580)
SENIOR DEPUTY PRESIDENT O’CALLAGHAN | ADELAIDE, 5 APRIL 2013 |
Costs application by Eastland Medical Systems Ltd - s.658 of the Workplace Relations Act 1996 - delay in lodging appeal - unreasonable action in commencing appeal - failure to discontinue matter - other proceedings
[1] This is an application made pursuant to s.658 of the Workplace Relations Act 1996 (the WR Act) by Eastland Medical Systems Ltd (Eastland) for costs against Mr Sims with respect to his unsuccessful application for an extension of time to appeal and his appeal against the Order of McCarthy DP 1 on 14 April 2010. In that Order the Deputy President refused Mr Sims’ application for a substantial extension of time for the lodgement of an unfair dismissal application. Eastland also seek costs in relation to this costs application. Notwithstanding the operation of the Fair Work Act 2009, this application applies under the WR Act because of the provisions of Schedule 2 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009.
[2] In our appeal decision 2 we referred to the Rules of the former Australian Industrial Relations Commission and determined that Mr Sims had not established any sustainable basis for the 2½ year delay in lodging the appeal. We found that Mr Sims’ appeal sought to re-agitate the matters raised before Deputy President McCarthy and that any extension of time would most likely prejudice the respondent in this matter. We concluded that Mr Sims had not established any error in the Deputy President’s decision and dismissed the appeal accordingly.
[3] Section 658 of the WR Act stated:
“658 Commission may order payment of costs
(1) If the Commission is satisfied:
(a) that a person (first party):
(i) made an application under section 643; or
(ii) began proceedings relating to an application; and
(b) the first party did so in circumstances where it should have been reasonably apparent to the first party that he or she had no reasonable prospect of success in relation to the application or proceeding;
the Commission may, on application under this section by the other party to the application or proceeding, make an order for costs against the first party.
(2) If the Commission is satisfied that a party (first party) to a proceeding relating to an application under section 643 has acted unreasonably in failing:
(a) to discontinue the proceeding; or
(b) to agree to terms of settlement that could lead to the discontinuance of the application;
the Commission may, on an application under this section by the other party to the proceeding, make an order for costs against the first party.
(3) If the Commission is satisfied:
(a) that a party (first party) to a proceeding relating to an application made under section 643 caused costs to be incurred by the other party to the proceeding; and
(b) that the first party caused the costs to be incurred because of the first party’s unreasonable act or omission in connection with the conduct of the proceeding;
the Commission may, on an application by the other party under this section, make an order for costs against the first party.
(4) If the Commission is satisfied:
(a) that a person (the representative) representing a party to a proceeding relating to an application made under section 643 caused costs to be incurred by the other party to the proceeding; and
(b) that the representative caused the costs to be incurred because of the representative’s unreasonable act or omission in connection with the conduct of the proceeding;
the Commission may, on an application by the other party, make an order for costs against the representative.
(5) In making a decision under this section, the Commission may have regard to any certificate issued or advice given under section 650 and whether a party pursued a course of action contrary to any such certificate or advice.
(6) An application for an order for costs under this section must be made within 14 days after the determination, discontinuance, settlement or dismissal of the application under section 643 or proceeding relating to an application under section 643 (as the case may be).
(7) A schedule of costs may be prescribed in relation to items of expenditure likely to be incurred in respect of:
(a) an application to the Commission under section 643; and
(b) a proceeding in respect of an application under section 643.
(8) Without limiting, by implication, the generality of the items of expenditure for which the schedule may provide, those items may include:
(a) legal and professional costs and disbursements; and
(b) expenses arising from the representation of a party by a person or organisation other than on a legal professional basis; and
(c) expenses of witnesses.
(9) If a schedule of costs is prescribed for the purposes of subsection (7), then, in awarding costs under this section, the Commission:
(a) is not limited to the items of expenditure appearing in the schedule; but
(b) if an item does appear in the schedule—must not award costs in respect of that item at a rate or of an amount in excess of the rate or amount appearing in the schedule.
(10) For the purposes of this section, the following proceedings are examples of proceedings relating to an application under section 643 in respect of which the Commission may make an order for costs:
(a) a proceeding for dismissal of an application under section 643 on the ground that the application is outside jurisdiction;
(b) conciliation proceedings under section 650;
(c) arbitration proceedings under section 652;
(d) an appeal to the Full Bench from an order of the Commission under section 654 or a costs order under section 658;
(e) a proceeding concerning an application for costs by one party in respect of another party’s application for costs.”
The Submissions
[4] The Eastland costs application was lodged on 21 December 2012. On 27 December 2012 Mr Sims lodged a motion to have the costs application set aside. Consistent with our advice to Mr Sims, we have considered this motion in reaching a conclusion relative to the costs application. Both parties have provided written submissions in this matter which was the subject of a hearing on 7 March 2013.
[5] The Eastland position is that Mr Sims resigned his employment on 9 June 2009 and lodged his unfair dismissal application on 8 March 2010. The Deputy President’s decision to dismiss the application was issued on 14 April 2010 and his appeal was filed 2½ years later. In these circumstances, Eastland asserts that Mr Sims appeal was lodged when it should have been reasonably apparent to him that he had no reasonable prospect of success.
[6] Eastland referred to its correspondence to Mr Sims of 8 November 2012, which stated:
“Please find enclosed by way of service Notice of Representative Commencing to Act and Submissions filed on behalf of the Respondent.
We refer you to the Respondent’s Submissions. We are of the view that the Notice of Appeal has no reasonable prospect of success. We intend to seek an order that you pay the Respondent’s costs associated with the Appeal.
We hereby invite you to withdraw the Notice of Appeal and consent to orders that you pay the Respondent’s costs, alternatively to withdraw the Notice of Appeal and argue only the question of costs at the hearing on 13 November 2012.
We reserve the right to bring this letter to the Full Bench’s attention on the question of costs.”
[7] Eastland asserted that Mr Sims’ appeal notice and his submissions confirm that he was aware that the Tribunal could only deal with his unfair dismissal claim, and that he had already initiated actions in other Courts, in which he had made similar claims. 3
[8] Eastland asserted that it should have been apparent to Mr Sims that he had no reasonable prospect of success because:
● of the extraordinarily long delay
● the FWA Registry (as it was at the time) had notified him of the appeal time limit within 14 days of the Deputy President’s decision
● the notice of appeal and supporting submissions did not disclose a satisfactory reason for the delay
● no errors in Deputy President McCarthy’s decision were identified, and
● Mr Sims’ Notice of Appeal advised that he was seeking to force Eastland to meet its statutory and contractual obligations which reflected an ulterior motive in pursuing the appeal.
[9] Mr Sims’ position was that Eastland was not now a registered entity and did not properly comply with the Tribunal’s Directions issued in this matter. Mr Sims asserted that he was indemnified from costs by virtue of the contract which governed his employment with Eastland and/or, the Eastland Articles of Incorporation.
[10] Mr Sims asserted that Eastland had lied in the initial proceedings before the Deputy President and had not rectified this in the subsequent appeal proceedings. He submitted that Eastland’s behaviour was of a criminal nature and that Eastland was continuing to breach its statutory obligations. Further, that these matters were the subject of proceedings in multiple other jurisdictions. He particularly referred to a dispute over the provision or possession of a motor vehicle.
[11] Mr Sims asserted that the Tribunal had not considered the extent to which the delay was a consequence of his reliance on undertakings and advice given by Eastland which had not been honoured.
[12] We have noted that, attached to Mr Sims submissions, is an affidavit made out by Mr Strahan who was also a previous employee of Eastland.
Findings
[13] This Costs application was made by Eastland Medical Systems Ltd. Mr Sims’ has asserted that Eastland do not now exist. The material before us appears to indicate that Eastland has changed its name but we are unclear as to whether Mr Sims agrees that this is the case. Whilst Eastland indicated that it had no opposition to an amendment to the application to reflect this name change, it has not made a formal request that we do so or provided information in support of such a position. In these circumstances we are not inclined to alter the costs application so as to change the name of the party applying for the order from Eastland Medical Systems Ltd.
[14] Consistent with s.658(1) we are satisfied that Mr Sims instituted the appeal in circumstances where it should have been reasonably apparent to him that he had no reasonable prospect of success. Shortly after the Deputy President issued his decision, Mr Sims expressed his dissatisfaction with that decision. He was advised of his appeal rights within 14 days of that decision being issued. Mr Sims should reasonably have been aware that an appeal some 2½ years later was substantially outside of that time limit. Neither Mr Sims’ notice of appeal nor his submissions provided a satisfactory basis for this extraordinarily long delay other than his assertions that Eastland has not honoured earlier undertakings and advices. We consider that it should have been reasonably apparent to Mr Sims that his allegations about other proceedings could not form a sustainable basis for this appeal. As we observed in the Appeal Decision, Mr Sims has not identified errors in the Deputy President’s decision and has made no serious attempt to do this. He has simply sought to revisit those initial proceedings without establishing error in the decision under appeal.
[15] Additionally, we are satisfied that Mr Sims acted unreasonably pursuant to s.658(2) in failing to discontinue the appeal consequent upon advice received from Eastland’s Lawyers on or about 8 November 2012. That advice referred to the comprehensive submissions of Eastland and clearly put Mr Sims on notice of this costs application. Further, the Directions issued by this Full Bench on 14 November 2012 in relation to the conduct of the appeal stated:
“[7] The Full Bench directs to the attention of the parties correspondence to Mr Sims of 29 April 2010 which explained the appeal lodgement requirements. A copy of this and related correspondence is attached.
[8] Finally, the Full Bench notes that the respondent has foreshadowed a costs application in this matter. The Full Bench confirms the advice provided on 13 November 2012, to the effect that any such application will only be considered after the appeal proceedings are concluded.”
[16] Consequently, before the appeal hearing, Mr Sims was made aware of the advice provided to him in relation to appeal lodgement processes, including time limits in 2010 and the probability of a costs application. His submissions on appeal did not satisfactorily or seriously address this issue.
[17] We are satisfied that the preconditions for the making of a costs order are met in these circumstances. Such an order is nevertheless discretionary.
[18] We have considered Mr Sims’ motion to have the application for costs to be set aside but we are not satisfied that a sustainable basis for such an action has been made out. We make no comment on matters which may be the subject of proceedings in other jurisdictions. We have not been directed to any decisions relative to Mr Sims relationship with Eastland which would provide an explanation for Mr Sims’ conduct in lodging the appeal or the delay in doing so. We have considered Mr Sims’ request that our conclusion in this matter should be delayed pending the outcome of other, unspecified proceedings. Given the obligation on the Tribunal to act expeditiously and the absence of any clarity about other proceedings, we have decided that the legislative intent of s.658 of the WR Act requires us to reach a conclusion in respect to this costs application.
[19] We have taken into account that Mr Sims is self represented. We have noted Mr Sims’ assertions that Eastland has not been honest and that it has, and continues to engage in inappropriate behaviour. These assertions reflect ongoing differences between Mr Sims and Eastland which we understand continue to be addressed in other jurisdictions. It is clear that Mr Sims is, and has been actively involved in litigation in a number of jurisdictions.
[20] Mr Sims has argued that no costs order should be made against him as, because he is a former director and officer of Eastland, he is covered by a Directors’ and Officers’ indemnity insurance policy. Eastland and Mr Sims were given an opportunity to provide further information in this respect. We have considered this material. It is not appropriate that we express a view on whether or not Mr Sims would now be insured against a costs order of the nature sought by Eastland. It is simply the case that Mr Sims’ assertions of immunity from any costs application do not form a valid basis for us to refuse to further consider a costs order. If Mr Sims wishes to rely on such an asserted indemnity, he may elect to take further advice over its application to any order we make. That is a matter outside of our jurisdiction.
[21] We have also noted that on 27 March 2013 Mr Sims made further written submissions in which he seeks an order against Eastland of some $880000 together with an order for $250000 against the counsel for Eastland at first instance. We have not considered these submissions as there is no application before us to that effect. Given our appeal decision and this decision, we caution Mr Sims about making any such application.
[22] The issue before us here is simply put: Mr Sims sought to appeal a decision to refuse an extension of time. His appeal was lodged two and a half years after that decision was issued. Mr Sims’ was aware of the relevant appeal lodgement requirements. He has not identified error in that initial decision and has pursued this appeal in circumstances, and on grounds which are unreasonable. His actions have been compounded in that he has failed to make out a sustainable basis for this long delay but has approached it as an opportunity to pursue a second action against Eastland.
[23] We have concluded that an Order should be made for costs against Mr Sims in relation to:
● the application to extend time to institute an appeal
● the appeal itself, and
● the costs associated with the costs application.
[24] Eastland is directed to provide to us, and to Mr Sims, an itemised schedule of costs by 26 April 2013.
[25] Mr Sims may provide to us, and to Eastland, through its legal representative, Downings Legal, his position with respect to that schedule by 17 May 2013.
[26] The matter will then be referred to Senior Deputy President Drake for the assessment of costs in accordance with this decision.
SENIOR DEPUTY PRESIDENT
Appearances:
D Sims on his own behalf.
J Brits of counsel representing the respondent.
Hearing details:
2013.
Perth (and Video-link to Adelaide and Melbourne)
March 7.
1 PR996051
2 [2012] FWAFB 10783
3 Eastland submissions of 22 January 2013
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