Dr Peter Wirth v Calvary Health Care Act Limited (Public Division)

[2013] FWC 6680

[2013] FWC 6680

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Dr Peter Wirth
v
Calvary Health Care ACT Limited (Public Division)
(U2012/12024)

COMMISSIONER DEEGAN CANBERRA, 24 SEPTEMBER 2013

Application for Costs - application dismissed.

Introduction

[1] This decision concerns an application for costs made under s.611(2)(a) of the Fair Work Act 2009 (the Act) by Calvary Health Care ACT Limited (Public Division) (the Employer) in relation to costs incurred in defending an unfair dismissal application lodged by Dr Peter Wirth. The application for costs was lodged with the Fair Work Commission (the Commission) on 10 July 2013. The Employer seeks an order for costs on a party and party basis.

Background

[2] Dr Wirth made an application to the Commission 1 on 3 August 2012. The subject matter of the application was not resolved at conciliation and was referred for formal proceedings. The Employer subsequently raised an objection as to jurisdiction and the matter was accordingly listed for jurisdiction and arbitration hearing before me on 30 and 31 January 2013. Submissions and evidence were filed by both parties on the question of jurisdiction and the merits of the application in accordance with the Directions. In a decision issued on 4 June 2013, I indicated that I was satisfied that there was jurisdiction to deal with the substantive application and that the dismissal of Dr Wirth was unfair. I found that it was not practicable to reinstate Dr Wirth and, on 28 June 2013, ordered [PR538334] that the Employer pay compensation, an amount equal to one month’s remuneration.

Submissions

[3] The Employer’s costs application under s.611(2)(a) of the Act is made on the ground that the ‘Applicant’s application for unfair dismissal sought a remedy without reasonable cause which had no reasonable prospect of success.’ 2

[4] The Employer, by way of written submissions, submitted that Dr Wirth’s ‘single-minded pursuit of reinstatement’ had led him to reject reasonable settlement proposals involving a substantial amount of money. According to the Employer, it should have been evident to Dr Wirth that an order for reinstatement was not an available remedy as there was no evidence to support a conclusion that he had become a permanent employee. It was put therefore that the pursuit of reinstatement to a position that Dr Wirth never held was, ‘manifestly untenable and/or groundless.’ 3

[5] At the hearing, the Employer’s representative contended that the ‘application’ made by Dr Wirth consisted of the entirety of the application made. It was put that what was sought by Dr Wirth was reinstatement to a permanent position. As such, the claim was predicated upon Dr Wirth holding a permanent position at the time of his dismissal. Further, it was argued that although Dr Wirth achieved a measure of success in the proceedings, the case had been decided on a much narrower ground. The Employer submitted that the application, in the terms in which it was made by Dr Wirth, clearly was lacking any reasonable prospect of success, as reinstatement was never available to him.

[6] In the alternative, the Employer put that, in light of negotiations and settlement proposals that were put to Dr Wirth in the weeks leading up to the hearing, the failure to withdraw the application constituted Dr Wirth acting unreasonably.

[7] In response, it was submitted for Dr Wirth that the Commission’s power to award costs under s.611 of the Act is not invoked because an applicant is unable to achieve a particular remedy sought. It was noted that s.611(2) refers to an ‘application’ as opposed to ‘the pursuit of a particular remedy’. In this context it was claimed that, as Dr Wirth’s unfair dismissal application was ultimately successful, it could not be maintained that his application was without reasonable prospects of success. It was further submitted that reinstatement was an achievable remedy, and at no time in either the Employer’s written or oral submissions, did the Employer make it clear to either Dr Wirth or the Commission, that reinstatement was not a remedy that was available.

[8] It was the applicant’s primary argument that the application for costs should fail because ‘it was made for a reasonable cause, in the sense that Dr Wirth was seeking findings and orders that were all envisaged by the Act, and that the application was made with reasonable prospects of success for the simple fact that the application was successful’ 4.

Relevant law

[9] Section 611 of the Act provides as follows:

611 Costs

(1) A person must bear the person’s own costs in relation to a matter before the FWC.

(2) However, the FWC may order a person (the first person) to bear some or all ofthe costs of another person in relation to an application to the FWC if:

(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.

Note: The FWC can also order costs under sections 376, 400A, 401 and 780.

(3) A person to whom an order for costs applies must not contravene a term of the order.

Note: This subsection is a civil remedy provision (see Part 4-1).

Consideration

[10] There are few authorities which provide guidance where an application for costs is made against a successful applicant.

[11] The provisions of s.611 of the Act are clear. Costs may only be awarded under s.611(2)(a) if the Commission is satisfied that the applicant made the application vexatiously or without reasonable cause. There was no claim that the application was made vexatiously. Therefore, in order to award costs under s611(2)(a), I would have to be satisfied that the application was made without reasonable cause.

[12] Dr Wirth succeeded in his application. His dismissal was found to be unfair. In those circumstances, I am unable to find that the application was made without reasonable cause. I do not accept the Employer’s argument that the fact that Dr Wirth did not succeed in his preferred remedy of reinstatement is sufficient for me to find that the requirements of s.611(2)(a) are made out. Nor do I accept that the evidence was such that Dr Wirth should have known that reinstatement was not available. The applicant had an arguable case for reinstatement that, on the evidence and the application of legal principles, was not decided in his favour.

[13] The respondent argued, in the alternative, that costs should be awarded against Dr Wirth pursuant to s.611(2)(b) of the Act as it should have been reasonably apparent to him that his application had no reasonable prospects of success. I am unable to accept this argument for the reasons given above. The applicant was successful in his claim. It cannot be said that his application had no reasonable prospects of success. That Dr Wirth was not reinstated does not equate to a lack of success. The claim was for a remedy. The remedy to be awarded is at the discretion of the Commission pursuant to ss.390-392 of the Act.

Conclusion

[14] For the foregoing reasons, I dismiss the Employer’s application for costs. An order to that effect [PR541422] is issued separately.

Appearances:

Mr B. Gahan with Ms M. Page, for the applicant.

Ms D. Cross, for the Employer.

Hearing details:

2013.

Canberra:

August 9.

 1   On 1 January 2013, Fair Work Australia was renamed the Fair Work Commission (the Commission). In this decision I have referred to the Commission which incorporates reference to Fair Work Australia as it was known prior to 1 January 2013.

 2   Application Form F6 Application for Costs.

 3   Submissions on behalf of the Respondent, at Paragraph 17(d).

 4   Transcript PN1392.

Printed by authority of the Commonwealth Government Printer

<Price code A, PR541419>