Edgar v Norton Rose Fulbright Australia Services Pty Ltd and Ors (No.3)
[2020] FCCA 913
•23 April 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| EDGAR v NORTON ROSE FULBRIGHT AUSTRALIA SERVICES PTY LTD & ORS (No.3) | [2020] FCCA 913 |
| Catchwords: COSTS – Fair Work Act 2009 – whether the applicant was entitled to an order for costs because of unreasonable acts or omissions on the part of the respondents. |
| Legislation: Federal Circuit Court of Australia Act 1999, s.79 Fair Work Act 2009, ss.361, 570 |
| Cases cited: Edgar v Norton Rose Fulbright Australia Services Pty Ltd & Ors (No.2) [2020] FCCA 520 |
| Applicant: | SUET YING (ALICE) EDGAR |
| First Respondent: | NORTON ROSE FULBRIGHT AUSTRALIA SERVICES PTY LTD |
| Second Respondent: | ALEX BOXSELL |
| Third Respondent: | LEX MELZER |
| File Number: | SYG 1937 of 2018 |
| Judgment of: | Judge Cameron |
| Hearing date: | On the papers |
| Date of Last Submission: | 25 March 2020 |
| Delivered at: | Sydney |
| Delivered on: | 23 April 2020 |
REPRESENTATION
| Counsel for the Applicant: | Ms L. Andelman |
| Solicitors for the Applicant: | Harmers |
| Counsel for the Respondents: | Mr J. Darams |
| Solicitors for the Respondents: | Lander & Rogers |
ORDERS
The applicant’s application for costs of the application in a case filed on 24 January 2020 be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1937 of 2018
| SUET YING (ALICE) EDGAR |
Applicant
And
| NORTON ROSE FULBRIGHT AUSTRALIA SERVICES PTY LTD |
First Respondent
| ALEX BOXSELL |
Second Respondent
| LEX MELZER |
Third Respondent
REASONS FOR JUDGMENT
INTRODUCTION
On 24 January 2020 the applicant, Ms Edgar, filed an application in a case seeking to strike out certain paragraphs of the respondents’ defence. Judgment was delivered on 11 March 2020: Edgar v Norton Rose Fulbright Australia Services Pty Ltd & Ors (No.2) [2020] FCCA 520 (“Second Judgment”). It was ordered that:
(1)The particulars of paras.20(b), 25, 28(a)(ii), 31(a)(i), 37 and 41 of the defence be struck out.
(2)In all other respects the applicant’s application in a case filed on 24 January 2020 be dismissed.
(3)The respondents have leave to file an amended defence within 21 days.
Ms Edgar has now sought an order that the first respondent, Norton Rose Fulbright, pay her costs of the application in a case and the parties have agreed that the costs application be determined on the papers.
For the reasons which follow the application for costs will be dismissed.
RELEVANT LEGISLATION
The Court is empowered by s.79 of the Federal Circuit Court of Australia Act 1999 (“FCC Act”) to award costs in proceedings other than, relevantly, proceedings under the Fair Work Act 2009 (“FW Act”).
Section 570 of the FW Act relevantly provides:
570 Costs only if proceedings instituted vexatiously etc.
(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising 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:
…
(b)the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs …
EVIDENCE
The Second Judgment sets out the detail of the dispute over the particularisation of the defence.
The affidavits of the parties’ solicitors disclosed correspondence passing between them in connection with that dispute. In brief, commencing on 5 December 2019, Ms Edgar sought various further and better particulars and the respondents declined to provide them, implicitly saying that the requests were not proper requests for particulars. In their solicitors’ letter of 5 February 2020 the respondents offered to file an amended defence which removed or struck out the particulars of the defence’s paras.15(a)(i), 20(b), 25, 28(a)(i), 28(a)(ii), 31(a)(i), 37 and 41. They did not receive a response. It will be recalled that (only) paras.20(b), 25, 28(a)(ii), 31(a)(i), 37 and 41 of the defence were struck out by the order of 11 March 2020.
The applicant’s solicitor, Ms Fletcher Watson deposed that Ms Edgar incurred the following costs in bringing her application in a case:
a)$17,160 for counsel’s fees; and
b)$36,678.38 in professional costs and disbursements.
SUBMISSIONS
Applicant’s submissions
Ms Edgar referred to her solicitors’ 5 December 2019 letter to the respondents’ solicitors in which the respondents were invited to amend their defence on the basis that its pars.8, 14(a)(ii), 15(a)(ii), 19(a)(iii), 20(b), 25, 28(a)(i), 31(a)(i), 34, 35(a)(iii), 36(b), 37, 41, 42(b), 44(a)(ii) were likely to be struck out because they did not comply with the relevant rules which, as discussed in the Second Judgment, were found in the Federal Court Rules 2011 (“FCA Rules”). She also referred to the fact that Norton Rose Fulbright had not amended or better particularised those paragraphs of the defence that were struck out on 11 March 2020 notwithstanding her 5 December 2019 request that it do so.
Ms Edgar contended that the pleading rule on which she had been successful, r.16.08 of the FCA Rules, was clear in its meaning. She submitted that Norton Rose Fulbright’s conduct had been unreasonable because it had maintained what she described as an unarguable position even after she raised her concerns about the defence. She argued in that connection that:
a)Norton Rose Fulbright’s argument that its defence raised no matter not already raised in her own statement of claim had been a hopeless one because some of the particulars complained did raise issues which were not canvassed in the statement of claim, relevantly Norton Rose Fulbright’s reasons for dismissing Ms Edgar;
b)the respondents’ argument that particulars could not be struck out because they were not pleadings was not arguable on a legal basis and no authorities were cited in support of this “unorthodox submission”;
c)the respondents’ submission that her application was futile because, whether or not the particulars were struck out, the respondents could lead such evidence, was not arguable because she was entitled to know the case she had to meet; and
d)the submission that Norton Rose Fulbright was under no obligation to plead the material facts concerning the reason for its adverse action against her was not arguable.
Ms Edgar also submitted that she had acted reasonably and had attempted to resolve the matter.
Respondents’ submissions
The respondents opposed Ms Edgar’s application for costs and submitted that:
a)the Court only struck out six of the fourteen paragraphs or particulars put in issue by Ms Edgar’s application in a case and so she had been only partially successful;
b)in their 5 February 2020 letter, they had offered to amend their defence and strike out or remove paras.15(a)(i), 20(b), 25, 28(a)(i), 28(ii), 31(a)(i), 37 and 41 on the basis that Ms Edgar did not press her objections to the other paragraphs of the defence – an outcome similar to the Court’s decision;
c)because she did not respond to their offer to amend certain particulars of the defence, any costs incurred after 5 February 2020 were the result of Ms Edgar’s decision to pursue the application in a case;
d)the responsibility for such other costs as Ms Edgar incurred lay at her own feet not at Norton Rose Fulbright’s because she was determined to challenge certain paragraphs of the defence which the Court allowed; and
e)if anyone’s conduct was unreasonable it was Ms Edgar’s because she did not respond to their offer.
CONSIDERATION
The question raised by the present application is whether it was unreasonable of Norton Rose Fulbright to defend the particularisation of paras.20(b), 25, 28(a)(ii), 31(a)(i), 37 and 41 of the defence. Questions of unreasonableness are fact dependent and rely on the circumstances of the case.
The authorities on s.570(2)(b) of the FW Act and its predecessor in the Workplace Relations Act 1996 are predominantly concerned with whether a party has acted unreasonably in refusing an offer of settlement. It is not unreasonable simply to be mistaken, misguided, inefficient or late: Rentuza v Westside Auto Wholesale [2009] FMCA 1022 citing Construction, Forestry, Mining and Energy Union v Clarke (2008) 170 FCR 574 at 582-3 [29], [30] and Australian and International Pilots Association v Qantas Airways Ltd (No.3) (2007) 162 FCR 392 at 403 [39]. As to what is, rather than what is not, unreasonable the cases point to the pursuit of proceedings which are incompetent or hopeless: Australian and International Pilots Association v Qantas Airways at 402 [36]. As Tracey J said in Australian and International Pilots Association v Qantas Airways:
… It does not, necessarily, follow that the party whose pleading has been struck-out acted unreasonably by seeking to rely on the deficient pleading. An objective analysis of the particular party’s conduct will be necessary in each case. (at 402 [32])
In the context of a pleading and whether a party acts unreasonably in pressing it in the face of an objection by an opponent, it must first be said that the fact that the successful party has argued to the unsuccessful party, perhaps several times and from an early point, that the latter’s position was likely or even certain not to find favour with the Court may say nothing about whether the unsuccessful party’s position was unreasonable. Those circumstances may merely reflect the successful party having an aggressive or opinionated approach to the litigation. As Gleeson CJ and McHugh J said in Minister for Immigration & Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 626 [40], albeit in a different context:
… Someone who disagrees strongly with someone else's process of reasoning on an issue of fact may express such disagreement by describing the reasoning as “illogical” or “unreasonable”, or even “so unreasonable that no reasonable person could adopt it”. If these are merely emphatic ways of saying the reasoning is wrong, then they may have no particular legal consequence.
A willingness to consider and engage in an active intellectual sense with criticisms of one’s pleading is demonstrative of a reasonable approach to the conduct of litigation and in many cases the disinclination to do so will be demonstrative of the opposite. Those may be decisive considerations when compromises are rejected but not bettered by the offeree or when concessions are made later rather than earlier. However, the ultimate touchstone of reasonableness in the prosecution of a particular pleading is the merit of the pleading itself, as a pleading, and whether it is so devoid of merit that it was unreasonable to persist with it: McAleer v University of Western Australia (No.2) (2007) 161 IR 151 at 152 [5].
In this case, the only portions of the defence which were struck out were the particularisations of the respondents’ traverses of Ms Edgar’s allegations of adverse action in which the respondents set out the reasons for doing what they said they had done. Particularisation of a traverse is not necessary, or even logically possible, because a traverse is not an allegation. However, in this case each of the allegations in question had the effect of throwing an onus onto at least two of the respondents by engaging the rebuttable presumption found in s.361 of the FW Act that the adverse action, if proved, had been taken for a prohibited reason. The respondents’ position was that the onus was an evidentiary onus not a legal onus and so no positive pleading was required of them. It was said that the particulars were provided simply to put Ms Edgar on notice of what the respondents would be saying in connection with the s.361 presumption.
For the reasons given in the Second Judgment, I found that the onus was an evidentiary one and that on that basis no positive pleading was necessary. The implication of that conclusion is that the particulars to which objection was taken were, strictly speaking, otiose. However, I found that, in the circumstances, procedural fairness, as prescribed in r.16.08 of the FCA Rules, nevertheless required the respondents to put Ms Edgar on notice of how they would seek to rebut the s.361 presumption. The particulars of paras.20(b), 25, 28(a)(ii), 31(a)(i), 37 and 41 were struck out so that the defence could be amended to address that concern.
I am unaware of any decisions before the Second Judgment which consider whether a respondent is required to do more than traverse an allegation under s.361 that adverse action was taken for a prohibited reason and should nail its colours to the mast and plead a positive case in that connection. The respondents’ particularisation of traverses was technically incorrect but reflected no more than a mistaken view of the appropriate course to take and the Second Judgment demonstrates that the issue was not necessarily a straightforward one. In those circumstances, it was not unreasonable of the respondents to draw their defence as they did.
CONCLUSION
I am not persuaded that the respondents acted unreasonably in pleading and then persisting with the particulars of paras.20(b), 25, 28(a)(ii), 31(a)(i), 37 and 41 of the defence.
Consequently, the applicant’s application for costs of the argument in relation to them will be dismissed.
I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of Judge Cameron
Associate:
Date: 23 April 2020
0
5
4