Drury v Andreco Hurll Refractory Services Pty Ltd - [2005] FMCA 186

FEDERAL MAGISTRATES COURT OF AUSTRALIA

DRURY v ANDRECO HURLL REFRACTORY SERVICES PTY LTD

[2005] FMCA 186

PRACTICE & PROCEDURE – Human Rights – application for security for costs – whether the Court should exercise its discretion and award security for costs.

Croker v Sydney Institute of TAFE (NSW) [2003] FCA 942
Elshanawany v Greater Murray Area Health Service [2004] FCA 1272
Equity Access Ltd v Westpac Banking Corporation (1989) ATPR 40-972

Applicant:

RAYMOND DRURY

Respondent:

ANDRECO HURLL REFRACTORY SERVICES PTY LIMITED

File Number:

SYG 55 of 2005

Judgment of:

Raphael FM

Hearing date:

24 February 2005

Date of Last Submission:

24 February 2005

Delivered at:

Sydney

Delivered on:

24 February 2005

REPRESENTATION

Solicitors for the Applicant:

Taylor & Scott

Solicitors for the Respondent:

Cutler Hughes & Harris

ORDERS

Application for security for costs dismissed.
The Respondent to the main proceedings, the applicant for security, pay the Applicant's costs, assessed in the sum of $1,000 pursuant to Part 21 Rule 21.02(2)(a) of the Federal Magistrates Court Rules.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 55 of 2005

RAYMOND DRURY

Applicant

And

ANDRECO HURLL REFRACTORY SERVICES PTY LIMITED

Respondent

REASONS FOR JUDGMENT

I have before me today an application by the respondent to these proceedings for security for costs against the applicant. The Federal Magistrates Court Rules in Part 21 Rule 21.01 provide that on application by a respondent the court may order an applicant to give security that the court considers appropriate for the respondent's costs of the proceedings.
The proceedings in question are a claim under s.41PO Human Rights and Equal Opportunity Commission Act 1986 (Cth) alleging breaches of ss.15 and/or 17 of the Disability Discrimination Act 1992 (Cth) by the respondent who was for some 27 years the applicant's employer. The applicant alleges that after he had been injured in a work situation he was not offered any re-engagement by the respondent and that this refusal to offer him employment arose out of the existence of his disability or alternatively, was the result of him having brought some previous proceedings in this court seeking relief under the Disability Discrimination Act.
In 2003, the applicant did bring proceedings in this court seeking relief under the Disability Discrimination Act. Those proceedings were dismissed by order of Driver FM with an order that the applicant pay certain costs to the respondent. His Honour found that the application as then articulated disclosed no reasonable cause of action. His Honour said at [11]:
“I find that I have no jurisdiction to consider a claim by Mr Drury that he has been denied future employment on the basis of a disability. His claim that he has been dismissed from his employment must necessarily fail. His claim that he was discriminated against in the course of his employment is almost certain to fail. In those circumstances, it is in the interests of everybody, including Mr Drury, that the proceedings can be terminated now rather than left to a full hearing, which would be expensive for the unsuccessful party, probably Mr Drury.”
However, his Honour also said at [8]:
“In his oral submissions before me this afternoon, Mr Drury complained that he had not been offered any more jobs with the respondent. I do not rule out the possibility that Mr Drury might be able to present a plausible claim of a breach of section 15(1)(b),(c) or that matter (a) of the DDA or possibly section 17(1)(a) of the DDA. "Employment" is defined in the DDA to include contract employment.”
Mr Drury was self represented in the hearing before Driver FM. He appears not to have understood the necessity for confining the complaint that he made to the court to the complaint that he made to HREOC.
The current complaint does not suffer from such a problem. Mr Drury made application to his former employers for employment. No employment was forthcoming. He complained about this to HREOC and the normal procedures were then put in place. When a conciliation conference failed to bring the matter to settlement, Mr Drury took the step, which he was entitled to take, of bringing the matter before this court. It is also important to note that, in these proceedings, Mr Drury is represented by a firm of solicitors renowned in the field of industrial matters.
Regrettably, the costs order remains unpaid.
The respondents have filed in support of their application for security for costs, an affidavit of Pamela Marie Flynn dated 2 February 2005. In accordance with the standard procedures for such an application, Ms Flynn sets out her estimate of the costs to her client of the proposed proceedings. She does this helpfully, in two ways. First, she gives an estimate of the solicitor and client costs in total, and second, the likely costs which she estimates would be awarded to her client if it succeeded.
She points out that the applicant has not paid or, she says, made any attempt to negotiate payment of the sum of $2,847.50 costs which has now been outstanding for almost one year.
On the other side, Mr Drury says that he is not in a position to make immediate payment of this sum because he is unemployed. He is unemployed, he says, because the respondent has refused to give him any employment even though he had previously worked for them for approximately 27 years.
There is exhibited to an affidavit filed on his behalf some correspondence between himself and the respondents. It certainly indicates that he made some attempt to settle the question of costs, even though the settlement may have been bound up with his obtaining further employment.
Although I have not had the benefit of any authority cited to me by either party, I am able to remind them of the two seminal cases on this matter which have particular relevance to proceedings brought under the HREOC and Disability Discrimination Act. These cases are Croker v Sydney Institute of TAFE (NSW) [2003] FCA 942 and Elshanawany v Greater Murray Area Health Service [2003] FCA 942.
In both cases, their Honours Bennett J in Croker and Jacobson J in Elshanawany, noted the six specific matters identified in Equity Access Ltd v Westpac Banking Corporation (1989) ATPR 40-972 as relevant for consideration in deciding whether security for costs ought to be awarded. Jacobson J also stated at [11]:
“The applicant is a natural person and there is long standing authority for the proposition that, in general, a natural person who commenced litigation will not be required to provide security for the costs merely because that person is impecunious. The authorities were reviewed by Hill J in Fletcher v Federal Commissioner of Taxation (1992) 110 ALR 233 at 235-237.”
Jacobson J then set about distinguishing the case before him and Croker. Croker was, in fact, a case in which the application for security for costs was made in relation to an appeal against a decision of mine in which as her Honour said at [28]:
“I note the Federal Magistrate has expressed a forceful view as to the merits and prospects of success of Mr Croker's claim. Mr Croker has not made any submissions to me on the prospects of success or the basis of his appeal, other than to point to his affidavit and draft notice of appeal.”
The six matters are:
·The prospects of success;
·The quantum of risk that a costs order will not be satisfied;
·Whether the making of an order would be oppressive in that it would stifle a reasonably arguable claim;
·Whether any impecuniosity of the appellants arises out of the conduct complained of;
·Whether there are aspects of public interest which weigh in the balance of such an order;
·Whether there are any particular discretionary matters peculiar to the circumstances of the case.
In regard to the question of the prospects of success, I have not received an enormous amount of assistance. This is because the proceedings were only filed by Mr Drury on 10 January 2005. As required the applicant filed an Information Sheet, and an affidavit in support. He relies effectively on a statement, which he made to HREOC in support of his application to that organisation dated 4 July 2004. In that statement he deposes to his work history, the accidents that he suffered, his going off work on light duties for a period of time, his attempts to return to work and certain hearsay conversations between a union employee and a person allegedly in some form of authority with the respondent.
I have seen no evidence from the respondent. But this is not a criticism given the fact that no directions hearing has yet been held.
Whereas the claims made by Mr Croker were, in my view, clearly without merit, the claims made by this applicant could well be capable of being established. It does seem to be arguable that the reason or part of the reason for not re-employing a person who had received regular casual employment for a period as long as the applicant had might be due to concerns about his having commenced proceedings against his former employer, or concerns arising otherwise out of his disability. This is not a pre-judgment of the issue; merely an indication that it is an issue capable of being proved.
I would have to accept, because there is no evidence before me concerning Mr Drury's financial situation, that there is a considerable risk that if he was unsuccessful in these proceedings a costs order will not be satisfied. This is a matter that must be weighed up in the balance.
On the other hand, given Mr Drury's apparently difficult financial situation, it could be successfully argued that the making of an order for security would be oppressive in that it would stifle a reasonably arguable claim. There seems to me to be little doubt that if an order for security in the amount requested by the respondents was given, Mr Drury's claim would not proceed.
It could also be argued that the impecuniosity that Mr Drury currently suffers from does arise out of the conduct complained of. He says he has not been re-employed by the respondent for reasons which he believes are unlawful. He has not proved this yet. He may not be able to prove it but, on the other hand, he might, and if he did, then his problems would clearly arise out of that unlawful conduct.
In Elshanawany, Jacobson J at [24] dismissed the suggestion that there was an underlying legislative policy that financial impediment shall not impose upon an applicant at the price of bringing proceedings under the HREOC Act. Therefore, I cannot say that there are any aspects of public interest that weigh in the balance against the making of an order.
Finally, I have to consider whether there are any particular discretionary matters peculiar to the circumstances of the case. I think there is one such circumstance and that is the failure of Mr Drury to make payment of the previous costs order. Notwithstanding that Mr Drury has, to my mind, made some attempt to deal with this matter, it cannot be said that any substantive offer has been made.
In order to come to a proper decision as to whether or not to exercise my discretion in favour of the application, I must balance all these matters. It seems to me that at the present time, namely, at the commencement of these proceedings, the balance is in favour of Mr Drury. I simply do not know enough about the case of either party to justify the making of an order which I believe will have the effect of stifling the litigation.
It is generally accepted that it is the duty of an applicant for security for costs to make such applications speedily and, indeed, in Elshanawany one of the criticisms of the applicant for the order was that this was not done. The respondent, in this case, cannot be criticised in that way. However, I believe that the interests of justice would best be served if I made no order at this time, but made it clear that any application that was made at some future time would not suffer from any argument that it had not been made promptly. If such an application is made I have no doubt that those making it will give attention to the cases which I have cited.
I dismiss the application for security for costs. I order that the Respondent to the main proceedings, the applicant for security, pay the Applicant's costs, which I assess in the sum of $1,000 pursuant to Part 21 Rule 21.02(2)(a) of the Federal Magistrates Court Rules.

I certify that the preceding twenty-four (24) paragraphs are a true copy of the reasons for judgment of Raphael FM

Associate:

Date: 1 March 2005