Dunne v Rail Corporation,NSW (No 2)

[2006] NSWADT 335

CITATION:	Dunne v Rail Corporation,NSW (No 2) [2006] NSWADT 335
DIVISION:	Equal Opportunity Division
PARTIES:	APPLICANT Monica Dunne RESPONDENT Rail Corporation, New South Wales
FILE NUMBER:	051091
HEARING DATES:	On the papers
SUBMISSIONS CLOSED:	11/09/2006
DATE OF DECISION:	11/28/2006
BEFORE:	MacDermott T - Judicial Member
CATCHWORDS:	Costs
MATTER FOR DECISION:	Costs
LEGISLATION CITED:	Anti-Discrimination Act 1977
CASES CITED:	Borg v Commissioner, Department of Corrective Services [2003] NSWADT 35 Collier v Sunol (No 2) [2006] NSW ADT 88 Duggan v Shore Inn Pty Limited (1993) EOC 92-483 Dunne v Rail Corporation, New South Wales [2006] NSWADT 273 French v Sydney Turf Club & Anor [1999] NSWCA 195 Gallagher v New South Wales Police Service [1998] NSWEOT Higginson v Cargill Australia Limited [2001] NSWADT 152 Holdaway v Qantas Airways Limited ((1992) EOC 92-430 Jordan v North Coast Area Health Service (No3) [2005] NSW ADT 296 Lavery v Commissioner of Fire Brigades [2003] NSWADT 93 Perlidis v Brambles Security Services Limited Trading as Brambles Armoured [2003] NSWADT 11 Sebastian v Rail Infrastructure Corporation & anor (EOD) [2006] NSWADTAP 44 State Transit Authority v Sloey & Anor [1999] NSWSC 47
REPRESENTATION:	APPLICANT M Moir, Barrister RESPONDENT K Eastman, Barrister
ORDERS:	1. The respondent is to pay three quarters (75%) of the applicant’s legal costs incurred in these proceedings; 2. If the parties are unable to agree on the amount of those costs within 28 days, those costs are to be determined by a costs assessor in accordance with the Legal Profession Act 2004.

REASONS FOR DECISION

Decision

1 For the reasons we give below, we make an order for the payment of part of the applicant’s legal costs by the respondent.

Background

2 In the substantive proceedings Ms Dunne’s complaint of discrimination on the ground of her disability was substantiated: Dunne v Rail Corporation, New South Wales [2006] NSWADT 273.

3 The parties were requested to make written submission on the issue of costs. The decision also stated that unless either party submitted good reasons for doing otherwise, the issue of costs was to be determined on the basis of the written submissions without the need for an oral hearing.

4 Each party filed written submissions on the question of costs. The respondent submitted that the issue of costs could not be determined without a hearing to address matters of evidence which had been raised in the applicant’s written submissions. On the basis of this submission, the Tribunal proceeded to arrange a hearing for the costs application. However, the parties then resolved this issue by consent. Correspondence between the parties dated 6 and 9 November 2006, which was provided to the Tribunal, indicate that the applicant agreed not to rely on paragraphs 8-14 and annexures 1-4 of her submissions, on the basis that the respondent would not seek to have the issue of costs determined by a hearing. We have taken this correspondence to be part of the parties’ written submissions. We have not had regard to the material excluded by this agreement, nor do we propose to have the matter determined by a hearing as the respondent no longer seeks such a hearing.

Legislative provision

5 Section 110 of the Anti- Discrimination Act 1977 (the ADA) provides that each party is to pay his or her own costs, unless the Tribunal is of the opinion that in a particular case there are circumstances that justify making an order as to costs. The parties were asked to address in their submissions the question of what are the circumstances in these proceedings that would justify departure from the general position that each party pay his or her own costs.

6 Practice Note 12 sets out the law and the usual practice of the Tribunal in relation to costs. In Sebastian v Rail Infrastructure Corporation & anor (EOD) [2006] NSWADTAP 44 at [42] the Appeal Panel summarised the relevant principles in relation to an application for costs as follows:

(1) Section 110 creates a presumption that each party will pay his or her own costs and a discretion to award costs: Cleary Bros (Bombo) Pty Ltd -v- Cvetkovski (EOD) [2001] NSWADTAP 10 at paras 63-65;

(2) This discretion must be exercised judicially, and no authority or rule can determine whether in any particular case an order should be made;

(3) Previous cases relating to costs can only provide an indication of the kinds of circumstances that may attract a costs order;

(4) As a general proposition, a combination of circumstances is required in order to justify an award of costs.

7 The circumstances that are generally regarded as relevant to the question of whether an applicant should be awarded costs include: the manner in which the parties have conducted the proceedings; whether the case raises any important public policy or public interest considerations; whether the applicant's costs exceed or are disproportionate to the amount of damages awarded, and whether the proceedings determine or clarify an important question of law (See Borg v Commissioner, Department of Corrective Services [2003] NSWADT 35 at [21] and Collier v Sunol (No 2) [2006] NSW ADT 88 at [34]).

8 While past decisions have generally relied on a combination of factors to justify an award of costs, the decision in Jordan v North Coast Area Health Service (No3) [2005] NSW ADT 296 based a costs order solely on the fact that the applicant’s legal costs exceeded the amount of damages awarded.

Costs application

9 In seeking an order for costs, the applicant relies on a number of circumstances to justify a costs order. The respondent submits that there are no grounds for departing from the general rule that each party pay it own costs.

Manner in which parties conducted the proceedings

10 The applicant’s first submission regarding the circumstances justifying a costs order is the manner in which the respondent conducted the proceedings. The allegation that the respondent failed to participate genuinely in mediation is no longer relied on. However, the applicant does rely on the respondent’s alleged failure to produce relevant documents, and its failure to file other relevant material in accordance with the timetable.

11 The applicant particularises the failure to produce relevant documents as including the failure to provide statements from Mr Greenhalgh and Mr Lazzarini, who she claims were material and relevant witnesses. We do not see this as any failure on the respondent’s part. Where a party does not submit a statement or rely on the evidence of a particular witness, the other party has the ability to seek to obtain that evidence by requesting the issuing of a summons for that person to give evidence. The applicant did not do so in the case of either Mr Lazzarini or Mr Greenhalgh. Further, the Tribunal is able to draw an inference from the failure to call a particular witness, if warranted in the circumstances. In any event, the respondent did call Mr Lazzarini to give oral evidence when the applicant was permitted to amend the Amended Points of Claim on the second day of the hearing, subject to the respondent calling other evidence.

12 The applicant also points to the fact that the respondent objected to the admission of certain correspondence (Exhibit I) and sought to further cross-examine a witness if the material be admitted. The Tribunal regarded this evidence as relevant, but acceded to the request to cross-examine the witness as appropriate in the circumstances. We do not regard this as conduct on the part of the respondent causing additional delay or expense.

13 Finally, the applicant points to the failure of the respondent to provide any documents in answer to the amended summons for production of documents returnable on 25 July 2006. Correspondence from the respondent’s solicitor to the Tribunal indicated that the documents sought did not exist. It is not the role of a summons to require the creation of documents that do not exist. We do not draw any adverse inference from this, nor do we regard it as contributing to any delay or unnecessary costs in these proceedings.

14 The respondent submits that it was the manner in which the applicant conducted the proceedings that resulted in additional costs associated with the preparation for hearing and the duration of the hearing. It includes in this conduct (i) changes to the amended points of claim both as to the requirement for the purposes of indirect discrimination, and the relief sought; (ii) the issuing of a summons on the eve of the hearing (iii) failure to have a particular witness available (iv) the applicant’s initial indication that Mr Dawes was not required for cross examination and changing her mind; and (v) the applicant seeking to adduce new documentary evidence and also to call a witness in chief, Mr Girelly, after her case had closed; and (vi) the applicant’s failure to establish her claim for alleged economic loss.

15 The respondent asserts that it should have been possible to complete the matter in 1 day, and the fact that it took 3 days was attributable to the conduct of the applicant. During the case management of this complaint, the matter was set down for a three day hearing in consultation with the parties. The time frame proved to be an accurate reflection of the time necessary to resolve the issues in question. Although an application in relation to summons was heard on the first morning of the hearing, once this was dealt with the hearing proceeded on the listed days. A further summons, in relation to Mr Girelly, was dealt with swiftly.

16 The applicant’s amendment to the Amended points of claim on the second day of the hearing did involve calling a further witness for the respondent, namely Mr Lazzarini. However, we provided written reasons for allowing this amendment, which included the fact that the alleged removal from station duties was part of the applicant’s original complaint to the ADB, and therefore we regarded the respondent as on notice that this would be an issue.

17 On the question of whether the applicant changed her mind about requiring Mr Dawes for cross-examination, the respondent made Mr Dawes available as a witness to assist the Tribunal in its deliberations, as he was responsible in part for administering the Guideline and related documents. The Applicant’s counsel was permitted to ask further questions after the Tribunal members had make various enquires of Mr Dawes. This did not contribute particularly to delay or additional costs. Finally, the applicant’s failure to establish a claim for economic loss did not add significantly to the time or cost involved in these proceedings.

18 Having looked at all the evidence we do not regard any of the conduct of the parties as a circumstance that would justify an order as to costs.

Public Policy, public interest and important question of law

19 The Applicant also claims that these proceedings raised issues of importance to the respondent and its sizeable workforce, as well as determining and clarifying an important issue of law regarding compliance with the Rail Safety (Health Assessment) Guideline 2004 (“the Guideline”). The respondent alleges that there is nothing in the circumstances of the applicant’s working arrangements that raise any issue of general importance beyond her particular case.

20 The question of whether it was mandatory for the respondent to act in the way it did towards the applicant was the crucial issue throughout the hearing. The applicant was met by the claim that the respondent was required to do this because of the obligations imposed on it by the Guideline. The respondent reiterated a number of times during the course of the hearing that it had no choice but to act in the way that it did in order to comply with the Guideline. Hence, the respondent argued that any alleged discriminatory treatment was not unlawful because of the operation of s 54 of the ADA, as the treatment she received was in compliance with the Guideline. In this sense, the proceedings raised important public policy considerations of the appropriate balance between, on the one hand, concerns for public safety and the health and safety of the individual in question, and, on the other, the right to work free from discrimination.

21 The question of the extent to which s 54 of the Act provides a defence to otherwise discriminatory conduct has been the subject of many Tribunal decisions. (See State Transit Authority v Sloey & Anor [1999] NSWSC 47; Lavery v Commissioner of Fire Brigades [2003] NSWADT 93; Higginson v Cargill Australia Limited [2001] NSWADT 152; French v Sydney Turf Club & Anor [1999] NSWCA 195, Perlidis v Brambles Security Services Limited Trading as Brambles Armoured [2003] NSWADT 11. These decisions have relied generally on a claim that any alleged discriminatory conduct is not unlawful pursuant to s 54 of the ADA as a consequence of compliance with occupational health and safety legislation.

22 In contrast, these proceedings did not rely on an argument regarding compliance with occupational health and safety obligations, but on compliance with the particular Guideline made pursuant to a statutory instrument. To the best of our knowledge, no other decision of the Tribunal has in the course of a hearing on the merits examined fully the operation of the Guideline. The Applicant was left with little choice but to have the issue of compliance with the Guideline determined by a hearing on the merits.

23 We do not regard the decision on the substantive issues in these proceedings to be confined to its own facts. We regard our decision as settling aspects other than those applicable to the complainant in question. (see Gallagher v New South Wales Police Service [1998] NSWEOT; Holdaway v Qantas Airways Limited ((1992) EOC ¶92-430)). The evidence given by the respondent’s witnesses Mr Lazzarini and Ms Koelmeyer, was to the effect that anyone regarded as failing to meet the relevant Guideline was removed from all station work, not only from safety critical work as provided by the Guideline. The evidence was that this was not a practice confined to the applicant, nor her particular condition. Therefore this decision will be highly relevant to, if not determinative of, similar complaints arising out of this particular practice.

24 These proceedings involved a detailed assessment of the requirement of the relevant Guideline in order to clarify whether compliance with the relevant Guideline established a defence under s 54 of the Act. These proceedings also raised an important question of law of whether the “ same of similar circumstances” for the purpose of the comparison required in a direct discrimination claim should include, as the respondent alleged, failing to satisfy the medical criteria under the Guideline.

25 We find that the issues raised in these proceedings involve consideration of the public policy in achieving an appropriate balance between principles of non discrimination and health and safety concerns. The decision is likely to have an effect on other similar cases. These proceedings also tested for the first time whether the Guideline could establish a defence under s 54 of the ADA, and the relevance of an alleged failure to meet the Guideline to a direct discrimination claim. We regard these as circumstances that justify making an order as to costs.

Legal Costs exceeding damages

26 The applicant submits that she will have spent more than twice the amount of her compensation award on the legal services she engaged to obtain it, and relies on the decision in Jordan v North Coast Area Health Service (No3) [2005] NSW ADT 296. The applicant submits that her costs are $ 31, 109.37 (see Annexure 6). The award of damages to the applicant in these proceedings was $14,000.

27 The respondent submits that the applicant, if properly advised would have been aware of the risk that her costs would exceed any compensation award, and that she could have proceeded in a different jurisdiction, where costs are available, if she was confident of her claim.

28 It is unfortunate that the costs involved in pursuing discrimination complaints before the Tribunal have increased to such an extent that in many cases they will exceed any award of damages. The complexity of the arguments in discrimination cases, such as the statutory compliance defence, means that complainants such as Ms Dunne generally need to be legally represented. We take into account the opinions expressed in such cases as Borg, Jordan, and Duggan v Shore Inn Pty Limited (1993) EOC 92-483 to the effect that “the substantial rights and protections conferred by the ADA should not be undermined by the cost of vindicating them” (see Borg at [23]). In our view, that the applicant’s costs exceeded the award of damages is a factor to be taken into account in the overall assessment of whether there is a combination of circumstances that would justify a costs order in this case.

Conclusion

29 The decision of the Tribunal is that the there are circumstances, when taken together, to justify making an order that the Respondent pay the costs of the Applicant, subject to the limiting factors referred to below. This is not a case of a single factor alone justifying the making of a costs order, but a combination of circumstances, discussed above, that together justify such an order. In summary, these circumstances are the public policy in achieving an appropriate balance between principles of non discrimination and health and safety concerns. The decision is likely to have an effect on other similar cases. The circumstances also include the fact that the case has involved a clarification of the circumstances in which compliance with the relevant Guideline provides a defence pursuant to s 54 of the ADA, as well as the Guideline’s relevance to the circumstances in a direct discrimination claim. In addition, we have taken into account the fact that the applicant, in the absence of a costs order, would be left significantly out of pocket.

Limiting factors

30 Finally, the respondent submits that if an order for costs is made, the order should be limited to reflect the way in which the applicant’s conduct of the case contributed to the costs. The Applicant submits that her complaint of discrimination was upheld and that there is no basis to limit any award of costs.

31 The Applicant’s claim of discrimination was upheld in relation to the one allegation of discrimination that was pursued at the hearing. Two other allegations of discrimination were abandoned on the first day of the hearing. This was despite the fact that an earlier preliminary application to amend the complaint with respect to these two allegations had been made prior to the hearing. Although the application to amend was settled by consent, it still involved some costs and delay.

32 Further, the Applicant gave no explanation of why it did not seek to issue a summons to produce until a few days before the hearing, when, if the matter had been attended to at an earlier stage, it could have been resolved before the first day of the hearing. Further, the applicant sought to have a different summons issued on the final day of the hearing after her case had closed, although this was dealt with fairly swiftly.

33 Finally, the Applicant amended her points of claim on the second day of the hearing to change the requirement for the purpose of her indirect discrimination claim. The respondent called a further witness on this point. Ultimately the applicant was not successful in her alternative claim of indirect discrimination.

34 In these circumstances, we consider there are factors in this case that warrant limiting the extent of a cost order to 75% of the applicant’s legal costs.

Orders

1. The respondent is to pay three quarters (75%) of the applicant’s legal costs incurred in these proceedings.

2. If the parties are unable to agree on the amount of those costs within 28 days, those costs are to be determined by a costs assessor in accordance with the Legal Profession Act 2004.