Edwards v Golden Cockerel Pty Ltd (No 2)

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FEDERAL COURT OF AUSTRALIA

Edwards v Golden Cockerel Pty Ltd (No 2) [2025] FCA 834

File number(s): QUD 165 of 2022
Judgment of: COLLIER J
Date of judgment: 23 July 2025
Catchwords: COSTS – whether s 570(2) Fair Work Act 2009 (Cth) enlivened – earlier judgment finding no case to answer by respondent – whether applicant commenced proceedings unreasonably – whether unreasonable act or omission of applicant – reasonable settlement offers of respondent during course of proceedings – failure of applicant to accept reasonable settlement offers – whether costs should be awarded on indemnity or party-party basis
Legislation:

Fair Work Act 2009 (Cth) ss 340, 351, 361, 569, 569A 570, (2), (a)

Federal Court of Australia Act 1976 (Cth) s 43

Federal Court Rules 2011 (Cth) rules 16.21(1)(b), (c), (d), (e), (f)
Cases cited:

Burt v University of Sydney (No 2) [2025] FCA 596

Colgate-Palmolive Co v Cussons Pty Ltd [1993] FCA 536

Edwards v Golden Cockerel Pty Ltd [2025] FCA 152

Hanson-Young v Leyonhjelm (No 5) [2020] FCA 34

Melbourne Stadiums Ltd v Sautner (2015) 229 FCR 221

Roy Morgan Research Ltd v Baker [2014] FWCFB 1175

Sperandio v Lynch (No 3) [2007] FCA 1243

SunshineLoans Pty Ltd v Australian Securities and Investments Commission (No 2) [2025] FCAFC 60

Wills v Chief Executive Officer of the Australian Skills Quality Authority (Costs) [2022] FCAFC 43
Division: Fair Work Division
Registry: Queensland
National Practice Area: Employment & Industrial Relations
Number of paragraphs: 26
Date of hearing: Determined on the papers
Solicitor for the Applicant: NR Barbi Solicitor
Counsel for the Respondent: Ms S Moody
Solicitor for the Respondent: AiGroup Workplace Lawyers

ORDERS

QUD 165 of 2022
BETWEEN:

LEAH EDWARDS

Applicant
AND:

GOLDEN COCKEREL PTY LTD

Respondent

ORDER MADE BY:

COLLIER J

DATE OF ORDER:

23 JULY 2025

THE COURT ORDERS THAT:

1.The applicant pay the costs of the respondent of and incidental to the proceeding incurred from and on 17 April 2024, including costs of and incidental to the hearing of 13 June 2024, on an indemnity basis.

2.The applicant pay the costs of the respondent of and incidental to the proceeding incurred prior to 17 April 2024 including:

(a)reserved costs,

(b)costs of and incidental to the applicant’s interlocutory application filed on 1 July 2022 to amend her originating application and statement of claim, and

(c)costs of and incidental to the hearing which was listed for 16 and 17 April 2024, on a party-party basis,

such costs to be taxed if not otherwise agreed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

COLLIER J:

  1. In my earlier judgment in this matter, Edwards v Golden Cockerel Pty Ltd [2025] FCA 152, I found that the respondent, Golden Cockerel Pty Ltd (Golden Cockerel) had no case to answer in respect of the claims of the applicant, Ms Edwards, in respect of ss 340 and 351 of the Fair Work Act 2009 (Cth) (FWA), or found alternatively…

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Details
Case
[2025] FCA 834
Decision Date

CaseChat Overview and Summary

In the matter of Edwards v Golden Cockerel Pty Ltd (No 2), the Federal Court considered the issue of costs under the Fair Work Act 2009 (Cth). The applicant, Ms Edwards, had previously brought proceedings against her employer, Golden Cockerel Pty Ltd, alleging unfair dismissal and other workplace-related claims. The court had previously found no case to answer by the respondent, and now the matter returns to the court to determine the issue of costs. The court was tasked with determining whether section 570(2) of the Fair Work Act was enlivened and whether Ms Edwards had commenced the proceedings unreasonably, given the offers of settlement made by Golden Cockerel.

The court found that Ms Edwards' conduct in rejecting Golden Cockerel's settlement offer of 16 April 2024 was unreasonable, as it added to the costs burden in the proceedings. The settlement offer was reasonable in nature, terms, and manner, but Ms Edwards rejected it without sufficient time to respond or obtain legal advice. The court also noted that the offer did not address reinstatement, which was what Ms Edwards sought. The court held that Ms Edwards was liable for indemnity costs from the time she rejected the settlement offer. The court also found that Ms Edwards should pay a proportion of the costs incurred prior to the rejection of the settlement offer on a party-party basis.

In conclusion, the court awarded costs to Golden Cockerel on an indemnity basis from the time Ms Edwards rejected the settlement offer and on a party-party basis for costs incurred prior to that date. The court held that Ms Edwards' unreasonable refusal to accept the settlement offer, coupled with the lack of reasonable terms and manner of the offer, justified the award of indemnity costs. The court also noted that Ms Edwards, as a litigant in receipt of legal advice, should have made a different decision in rejecting the settlement offer. The court's decision highlights the importance of considering settlement offers and the potential consequences of unreasonably rejecting them.

Orders

Orders of the court

1. The applicant pay the costs of the respondent of and incidental to the proceeding incurred from and on 17 April 2024, including costs of and incidental to the hearing of 13 June 2024, on an indemnity basis.

2. The applicant pay the costs of the respondent of and incidental to the proceeding incurred prior to 17 April 2024 including:

(a) reserved costs,

(b) costs of and incidental to the applicant’s interlocutory application filed on 1 July 2022 to amend her originating application and statement of claim, and

(c) costs of and incidental to the hearing which was listed for 16 and 17 April 2024, on a party-party basis,

such costs to be taxed if not otherwise agreed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

As a general proposition a party to proceedings under the FWA may be ordered by the Court to pay costs incurred by another party to the proceedings only in accordance with the provisions of s 570(2), or ss 569 or 569A of the FWA. In this matter, however, the parties have asked to be heard further in respect of their costs, and have filed relevant submissions and material. EVIDENCE OF THE PARTIES RELEVANT TO COSTS Evidence has been filed on behalf of both parties. A lawyer for the respondent, Mr Stewart Rinkevich, affirmed two affidavits. Ms Edwards has sworn one affidavit.Affidavits of Mr RinkevichAffidavit dated 21 March 2025 In his affidavit dated 21 March 2025 Mr Rinkevich relevantly deposed:3.Attached to my affidavit and marked Annexure "SR-1" is a true bundle of documents containing the following offers to settle made by the Respondent to the Applicant during the proceeding:(a) Offer dated 26 June 2023 for $12,500 [at p.2 of SR-1];(b) Offer dated 12 October 2023 for $8,000 [at p.6 of SR-1];(c) Offer dated 9 October 2023 for $5,000 [at p.9 of SR-1];(d) Offer dated 19 October 2023 for $12,500 [at p.12 of SR-1]; and(e)Offer dated 16 April 2024 for the matter to be discontinued with no order as to costs [at p.17 of SR-1).4. The Applicant rejected all of the above offers. The offers were generally of limited duration for acceptance, subject to execution of a deed of settlement and release and required each party to bear their own costs. In its letter of 19 October 2023 enclosing the offer of that date of Golden Cockerel, its lawyers relevantly stated:You are hereby put on notice that the Respondent invokes the principles contained in Calderbank v Calderbank [1975] 3 WLR 586 by reserving the right to rely on this correspondence in respect of any prospective application for costs if ultimately the outcome of the proceedings was less favourable, for you, than what has been offered to you above. We note that pursuant to section 570(2)(b) of the Fair Work Act, 2009 Cth, a court has the power to order that a party pay the costs incurred by another party if the court is satisfied that a refusal to accept an offer to settle can constitute an unreasonable act. In those circumstances, and in light of the above (particularly the decisions referred to), we strongly suggest that you seek advice on, and seriously consider the above offer in light of the potential implications of its refusal.The Respondent will rely on this letter on the question of costs if that becomes necessary. In its letter of 16 April 2024 enclosing the offer of that date of Golden Cockerel, its lawyers relevantly stated:Consequences of a failure to accept the OfferIf you should fail or refuse to accept the Respondent's offer by the above time and date, then - if our client should ultimately be successful in the proceeding - we will rely on this letter to argue that you should have to pay the Respondent's costs incurred from 18 April 2024 onwards on an indemnity basis, or alternately on a party-party basis to be assessed.Why you should accept the OfferIt is our view that you should accept our client's Offer for the following reasons:In our view, your claim under s 351 of the Fair Work Act 2009 (Cth) (FW Act) is doomed to fail for the reasons set out in our client's Outline of Submissions filed in this Proceeding. Those reasons include (in our view) your failure to plead and prove the necessary jurisdictional facts in order to trigger the application of the reverse onus in s 361 of the FW Act.In our view, your breach of contract claim is without merit for the reasons set out in our client's Outline of Submissions filed in this Proceeding. Those reasons include that you were paid 3 weeks' pay in lieu of notice at the time of your dismissal, which is the amount required by the applicable enterprise agreement and your contract of employment. No other damages are recoverable by you with respect to your termination.Your case has now closed without any expert evidence. On the evidence that you do rely on (being that contained in the single .affidavit filed by you), there is in our view insufficient evidence to establish either a claim under s 351 of the FW Act, or the pleaded breach of contract claim.Affidavit of 24 March 2025

Decision

Reasons for decision

Notwithstanding that settlement offer, Ms Edwards continued to press her claim. In my view Ms Edwards’ conduct in rejecting the settlement offer of 16 April 2024 in those circumstances was unreasonable, and added to the costs burden in the proceeding, such that indemnity costs ought to be awarded against her.CONCLUSION For the reasons outlined above, Golden Cockerel is entitled to its costs for the entire proceeding. From the time Ms Edwards rejected Golden Cockerel’s offer of 16 April 2024, Golden Cockerel should be entitled to those costs on an indemnity basis.

Ratio Decidendi

Legal Principle Established

In summary Ms Edwards submitted:·A costs order in the circumstances would be contrary to the protective intent of the FWA.·There is a high threshold prescribed by 570(2)(a) of the FWA before costs are awarded. The words “or vexatiously” elevates the circumstances to that of an exceptional nature.·At the time of commencement there had been no judicial consideration of many of the issues raised in these proceedings. To the extent that Golden Cockerel contended that the proceedings were without merit, this contention was made with the benefit of hindsight, and ignores the position of the law and Ms Edwards at the time of the commencement of the proceedings.·Ms Edwards was a litigant in receipt of the legal advice of a legal practitioner in the face of uncertain law and one of eight aggrieved employees, whose litigation goal was to be reinstated. It cannot be stated that a reasonable person in her position would have made another decision.·The issue of unreasonableness within the meaning of s 570(2) does not turn exclusively on success at trial.·Although Golden Cockerel contended that Ms Edwards’ refusal to accept each offer for settlement were unreasonable acts, Golden Cockerel does not particularise any other acts or omissions as unreasonable.·Golden Cockerel bears the onus of establishing that the offers made were reasonable in their nature, namely on reasonable terms and in a reasonable way (Melbourne Stadiums Ltd v Sautner (2015) 229 FCR 221, [166]). However, each of the offers made by Golden Cockerel were made in circumstances which were unreasonable because:·On each occasion Ms Edwards was provided insufficient time to respond (i.e., one day or two days depending on the offer);·Each offer required or may have required legal advice;·The content of the offers was unreasonable because they failed to address reinstatement, which is what Ms Edwards wanted; and·In circumstances where Ms Edwards commenced proceedings as one of multiple applicants, the Court may be minded to order that she pay a proportion of the indemnity costs for which she is otherwise liable.CONSIDERATION Section 570 of the FWA provides: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.Note: The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 569A.(2) The party may be ordered to pay the costs only if:(a) the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or(b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs; or(c) the court is satisfied of both of the following:(i) the party unreasonably refused to participate in a matter before the FWC;(ii) the matter arose from the same facts as the proceedings.