Elliott v Nanda and Commonwealth
[2001] FCA 550
•18 MAY 2001
FEDERAL COURT OF AUSTRALIA
Elliott v Nanda & Commonwealth [2001] FCA 550
DAMAGES – Joint and several liability – whether the Sex Discrimination Act 1984 (Cth) and the Human Rights and Equal Opportunity Commission Act 1986 (Cth) authorise an award of compensation on the basis of joint and several liability of several respondents –contribution between respondents.
PRACTICE AND PROCEDURE – meaning of “proceedings pending” – whether judgment has been given when reasons have been published but no orders made.
Sex Discrimination Act 1984 (Cth) s 83A
Human Rights and Equal Opportunity Commission Act 1986 (Cth) s 46PO
Federal Court Rules O 23 r11(4) & O 29 r5Ah Toy v Registrar of Companies (1985) 10 FCR 280 cited
Claderbank v Calderbank [1976] Fam 93 cited
Melhero Pty Ltd v Club X (No.2) (1997) 37 IPR 203 cited
Smallacombe v Lockyer Investments Co Pty Ltd (1993) 42 FCR 97 citedLEANNE ELLIOTT v PREM NANDA AND COMMONWEALTH OF AUSTRALIA
N 720 OF 1999LEANNE ELLIOTT v COMMONWEALTH OF AUSTRALIAN
N478 OF 2000MOORE J
18 MAY 2001
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N720 OF 1999
BETWEEN:
LEANNE ELLIOTT
APPLICANTAND:
PREM NANDA
FIRST RESPONDENTCOMMONWEALTH OF AUSTRALIA
SECOND RESPONDENTN 478 OF 2000
BETWEEN:
LEANNE ELLIOTT
APPLICANTAND:
COMMONWEALTH OF AUSTRALIA
RESPONDENTJUDGE:
MOORE J
DATE OF ORDER:
18 MAY 2001
WHERE MADE:
SYDNEY
THE COURT ORDERS AND DECLARES THAT:
1.Matters N 720 of 1999 and N 478 of 2000 be consolidated on and from the date of these orders with Dr Prem Nanda as the first respondent and the Commonwealth of Australia as the second respondent.
2.Dr Prem Nanda and the Commonwealth of Australia pay the applicant $15,100 within 7 days.
3.The liability of Dr Prem Nanda and the Commonwealth under order 2 is joint and several.
4.In the event that Dr Prem Nanda satisfies order 2, the Commonwealth of Australia pay Dr Nanda the sum of $5,000 within 24 hours of the satisfaction of the order.
5.In the event that the Commonwealth of Australia satisfies order 2, Dr Prem Nanda pay the Commonwealth of Australia $10,100 within 24 hours of the satisfaction of the order.
6.Dr Prem Nanda pay the applicant the sum of $5,000 within 7 days.
7.Dr Prem Nanda pay the applicant’s costs in N 720 of 1999 as agreed or taxed and on an indemnity basis on and from 16 June 2000 as agreed or taxed.
8.The Commonwealth of Australia pay the applicant’s costs in N 478 of 2000 as agreed or taxed.
9.There be no reduction in the costs to be paid to the applicant by operation of O 62 r36A.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N720 OF 1999
BETWEEN:
LEANNE ELLIOTT
APPLICANTAND:
PREM NANDA
FIRST RESPONDENTCOMMONWEALTH OF AUSTRALIA
SECOND RESPONDENT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N 478 OF 2000
BETWEEN:
LEANNE ELLIOTT
APPLICANTAND:
COMMONWEALTH OF AUSTRALIA
RESPONDENT
JUDGE:
MOORE J
DATE:
18 MAY 2001
PLACE:
SYDNEY
REASONS FOR JUDGMENT
Introduction
On 11 April 2001 I published reasons for judgment in these proceedings: [2001] FCA 418, which concern two applications brought by Ms Leanne Elliott ("the applicant"). One was an application (“the employment proceeding”) brought under s 83A of the Sex Discrimination Act1984 (Cth) ("S D Act") against Dr Prem Nanda ("the respondent"), a former employer of the applicant. The other application (“the agency proceeding”) was brought under s 46PO of the Human Rights and Equal Opportunity Commission Act1986 (Cth) ("HREOC Act") against the Commonwealth of Australia. These reasons should be read in conjunction with those earlier reasons. I concluded that both the respondent and the Commonwealth had engaged in conduct proscribed by the S D Act and that the applicant was entitled to compensation in the sum of $15,100 for loss and damage flowing from that conduct. I concluded also that the applicant was entitled to a further $5000 by way of aggravated damages from the respondent for his conduct following the making of the complaint to HREOC. I did not make orders giving effect to those conclusions. Rather the matter was stood over and the parties were directed to file and serve written submissions addressing the form of orders. I also directed written submissions be filed on the question of costs.
Submissions from the parties as to compensation
The applicant submitted that the respondent and the Commonwealth should be treated as joint-tortfeasers in that they should be considered jointly and severally liable to pay the $15,100 compensation. Counsel for the applicant referred to Burke v LOFT Pty Ltd [2000] FCA 1155, (2000) ATPR 41-781 in which a Full Federal Court considered the principles concerning equitable contribution. The applicant proposed the following orders:
“Compensation
1.That Dr Nanda pay the Applicant aggravated damages in the sum of $5,000.00 within 28 days.
2.Dr Nanda and the Commonwealth of Australia be jointly and severably liable to pay the Applicant damages in the sum of $15,100.00 within 28 days.
Costs
3.Dr Nanda pay the Applicant’s costs as agreed or assessed on an indemnity basis in proceedings N720 of 1999.
4.The Commonwealth of Australia pay the Applicant’s costs in proceedings N478 of 2000 as agreed or assessed with costs from 16 June 2000 being assessed on an indemnity basis.
5.The Commonwealth of Australia pay the Applicant’s costs as agreed or assessed on an indemnity basis in respect of the Notice of Motion filed 12 May 2000.”
Counsel for the respondent submitted that the obligation to pay compensation should be borne equally by the respondent and the Commonwealth, as reflected in the following orders:
“....
(iii) that pursuant to section 83A(2) of the Sex Discrimination Act, damages as against the First Respondent are assessed as:
$7,500.00 – damages
$50.00 – counselling
$5,000 – aggravated damges(iv) that pursuant to section 83A(2) of the Sex Discrimination Act, damages as against the Second Respondent are assessed as follows:
$7,500.00 – damages
$50.00 – counselling...”
The Commonwealth submitted that the respondent alone should pay all compensation awarded by the Court. That was because it was the respondent who sexually harassed the applicant and HREOC had awarded the applicant damages in the same amount, $15,100, in proceedings before it that did not involve the Commonwealth. It was submitted that although the conduct of the respondent has been deemed to be the conduct of the Commonwealth, if the Commonwealth paid any part of the compensation, it would alleviate the burden on the actual perpetrator of the sexual harassment to compensate for his wrongdoing. It was also submitted that there is no foundation in the relevant legislation for making the respondent and the Commonwealth jointly or severally liable. The Commonwealth’s submissions were later amplified in further written submissions.
Submissions as to costs in proceedings N720 of 1999
The applicant submitted that the respondent should pay her costs in the proceedings N720 of 1999 on an indemnity basis. Counsel for the applicant submitted that from 16 June 2000 costs should be determined in accordance with O 23 r11(4) of the Federal Court Rules which provides as follows:
“If:
(a)an offer is made by an applicant and not accepted by the respondent ; and
(b)the applicant obtains judgment on the claim to which the offer relates not less favourable than the terms of the offer;
then, unless the Court otherwise orders, the applicant is entitled to an order against the respondent for costs incurred in respect of the claim:
(c)up to and including the day the offer was made – taxed on a party to party basis; and
(d)after that day – taxed on an indemnity basis.”
Reference was made to a notice of offer of compromise (dated 16 June 2000) that the applicant would compromise the action on terms that the respondent pay the applicant $15,000, the respondent pay the applicant’s party/party costs as agreed or assessed and the respondent pay the applicant interest pursuant to s 51A of the Federal Court of Australia Act1976 (Cth).
The applicant also submitted that costs should be payable on an indemnity basis from the commencement of proceedings on 26 July 1999. Reference was made to several aspects of the respondent’s conduct which were said to warrant the exercise of the Court’s discretion to award indemnity costs from the outset. Reference was made to a letter the applicant’s solicitor sent to the respondent’s solicitor on 4 June 1999 which should be characterised as a Calderbank letter. In the letter the applicant’s solicitor advised the respondent’s solicitor that the applicant would institute proceedings in the Federal Court unless the sum of $15,000 awarded to her by HREOC was paid before 18 June 1999. Reference was also made to the need for the applicant to pursue proceedings before HREOC in which the respondent did not appear.
Counsel for the respondent submitted that the applicant’s costs in the proceedings N720 of 1999 should be borne equally by the respondent and the Commonwealth because the Commonwealth was granted leave to intervene in the proceedings and became a party on 4 October 2000. However, in relation to the evidence of Ms Matthews and the proposed evidence of Ms Hebbe, it was submitted that the applicant should pay the respondent’s costs, or alternatively that the applicant should pay her own costs. In relation to the evidence of Ms Matthews, it was submitted that the applicant initially indicated that the evidence would be led as tendency or propensity evidence but in fact was only relied upon to establish that Ms Mathews had made a complaint. That fact, it was submitted, was never in issue and therefore the evidence was unnecessary. It was submitted that costs were incurred in relation to Ms Hebbe although she did not give evidence and was not called in reply.
Counsel for the Commonwealth submitted that no costs should be awarded against the Commonwealth. It was noted that if the respondent had paid the damages as assessed by HREOC, Federal Court proceedings would not have ensued and proceeding against the Commonwealth would have served no purpose. It was further noted that the Commonwealth resisted the proceedings being heard together and did not participate in the cross examination of any of the applicant’s or the respondent’s witnesses.
Submissions as to costs in proceedings N478 of 2000
The applicant submitted that her costs should be paid by the Commonwealth on an indemnity basis from 16 June 2000. Reference was made to a notice of offer of compromise made by the applicant to the Commonwealth of that date. The offer relevantly provided that the applicant would compromise the action on terms that the Commonwealth pay the applicant $5,000 inclusive of costs. The applicant also submitted that the Commonwealth should pay the costs of the hearing of the applicant’s motion on 30 May 2000 to have the applications consolidated. That was because although the Commonwealth opposed the consolidation, it later made submissions in proceedings N720 of 1999 and was given leave to intervene in those proceedings.
The respondent submitted that the applicant’s costs in relations to these proceedings should be borne wholly by the Commonwealth.
The Commonwealth submitted that no costs should be awarded against it in these proceedings as the applicant gained no benefit from the application. It was submitted that the object of anti-discrimination proceedings is to recover compensation for loss or damage suffered and that, in this case, pursuit of that objective did not require the applicant to institute proceedings against the Commonwealth when proceedings against the respondent were already on foot.
Conclusion-Compensation
An unusual feature of this matter is that an aspect of the conduct of the respondent causing loss and damage to the applicant sounding in compensation is deemed by s 105 of the S D Act to also be the conduct of the Commonwealth. That is, they both unlawfully discriminated against the applicant. Obviously the applicant should not be compensated twice. However, in my opinion, it is appropriate that I endeavour to follow a course that ensures the applicant is compensated fully by both the respondent and the Commonwealth but also reflects the fact that, as between the respondent and the Commonwealth, the immediate cause of the discrimination was the respondent and that his conduct also constituted sexual harassment.
I canvassed with the parties whether or not an order should be made, even at this late stage, consolidating the proceedings so that the rights of the parties could be settled by one set of orders. The Commonwealth submitted this was not possible as the power to order consolidation under O 29 r 5 only arose when proceedings were pending. In this case, it was submitted judgment had been given and there were no proceedings pending. However, what is a "judgment" is a settled question of law (at least in cases where proceedings are brought seeking compensation or damages and reasons have been published but no orders made): see Ah Toy v Registrar of Companies (1985) 10 FCR 280. Moreover, proceedings are pending until they are finally concluded: see Melhero Pty Ltd v Club X (No 2) (1997) 37 IPR 203 at 205. I am satisfied that I have power to order consolidation of the proceedings against the respondent and the proceedings against the Commonwealth. I am also satisfied that it is desirable to do so for the reasons given in the preceding paragraph.
Both s 83A of the S D Act and s 46 PO of the HREOC Act confer a broad discretionary power on the Court to make such orders as it thinks fit. The power is expressed in sufficiently broad terms, in my opinion, to authorise not only an order that a respondent to proceedings pay compensation to an applicant, but also to make orders as between respondents that might, in other circumstances, be viewed as requiring contribution or indemnity. Accordingly it is unnecessary to deal with principles concerning equitable contribution apparently relied on by the applicant or to determine whether the provisions of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) might authorise orders concerning the liability of the respondent and the Commonwealth as between themselves.
In my opinion both the respondent and the Commonwealth should be jointly ordered to pay the applicant $15,100 compensation on the basis that, if that liability is satisfied by one party, the other party effectively provide contribution. In the orders I use the words “joint and several” to signify the nature of the liability to pay that I intend to create, by the orders, in exercise of the powers conferred by the legislation. I do not suggest that some common law principle, such as that which applies to joint tortfeasors, is to be applied in the present case with a particular result. As the respondent was the primary and immediate cause of the compensable loss and damage, he should bear the greater portion of the burden. I do not accept, however, that the Commonwealth should bear none of the burden. First, orders are not being made to punish either the respondent or the Commonwealth but rather are being made to compensate the applicant. Secondly, had the Commonwealth not engaged in conduct which I have found permitted the unlawful conduct of the respondent, that unlawful conduct would or may never have taken place. Accordingly I propose to order that, in the event that the respondent satisfies the liability to pay the $15,100, the Commonwealth is to contribute $5000. If the Commonwealth satisfies the liability then the respondent is to contribute $10,100. Plainly it is only the respondent who is liable to pay the $5000 aggravated damages.
Conclusion-Costs
As the applicant succeeded against the respondent in the employment proceeding and the Commonwealth in the agency proceeding, she is entitled to her costs in both proceedings. While it may be that some limited additional costs were incurred by all parties as a result of the way the applicant dealt with the evidence of Matthews and Heebie, it was a relatively minor matter in the conduct of the proceedings overall and does not warrant, in my opinion, some separate provision in any costs order. The more significant issue is whether, and if so from what point, the applicant is entitled to costs on an indemnity basis.
The principles concerning the awarding of costs on an indemnity basis have been often discussed: see Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 and Re Wilcox; ex parte Venture Industries Pty Ltd (1996) 72 FCR 151. They may be awarded when a party has refused a reasonable offer of compromise of the character referred to in O 23 r11(4). I am satisfied the respondent did so in this case and that the applicant is entitled to her costs in the employment proceeding on an indemnity basis from 16 June 2000. I do not, however, consider that the applicant is entitled to her costs on that basis before that. The letter of 4 June 1999 can properly be characterised, in my opinion, as a letter of demand even though it had been preceded by the determination of HREOC. I am not aware of any authority which suggests that the refusal to accede to a letter of demand exposes a respondent or defendant to an order for costs on an indemnity basis in subsequent litigation. While it is true that these proceedings followed the success of the applicant before HREOC and were necessary because the respondent refused to make payment consistent with its determination, that arose because the respondent was exercising a right to have the question of liability determined in this Court.
Different considerations arise in relation to the agency proceeding. While it is true that the Commonwealth also refused an offer of compromise, it was not in a form that might immediately attract the principles discussed in Calderbank v Calderbank [1976] Fam 93 because it is an offer inclusive of costs: see Smallacombe v Lockyer Investment Co Pty Ltd (1993) 42 FCR 97. More importantly, however, the ultimate liability of the Commonwealth was dependent upon the reach of s 105 which was , at that time, entirely unsettled in the sense that there was little judicial guidance on how it might apply. The only matter that might justify an order other than the usual order concerning the Commonwealth's liability for costs, is that referred to in pars [189]-[194] in my earlier reasons. However it is sufficient, in my opinion, the applicant has her costs of the consolidation motion as a result of the costs orders which will be made against both the respondent and the Commonwealth. While I earlier made observations about the conduct of the Commonwealth, it does not warrant any order of indemnity costs.
The applicant had to have recourse to this Court to pursue both applications. Accordingly, I propose to order that no adjustment be made to the costs payable because the applicant recovered less than $100,000 as might otherwise be the case by operation of O 62 r36A.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. Associate:
Dated: 18 May 2001
Counsel for Leanne Elliott: K Eastman Solicitor for Leanne Elliott: W G McNally & Co Counsel for Prem Nanda: G Scragg Solicitor for Prem Nanda: Marshall & Partners Counsel for the Commonwealth: S Winters Solicitor for the Commonwealth: Australian Government Solicitor Date of Hearing: 27 April and 1 May 2001 Date of Judgment: 18 May 2001
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