F Guerra v Speedie Waste T/A Speedie Waste Pty Ltd

[2015] FWC 100

[2015] FWC 100

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.402 - Application for costs

F Guerra
v
Speedie Waste T/A Speedie Waste Pty Ltd
(U2014/7291)

SENIOR DEPUTY PRESIDENT WATSON MELBOURNE, 13 JANUARY 2015

Application for costs in respect of conduct of unfair dismissal matter - application dismissed.

[1] This decision deals with an application by Speedie Waste T/A Speedie Waste Pty Ltd (the costs Applicant) under s.402 of the Fair Work Act 2009 (the Act) for an order for costs against Mr F Guerra (the costs Respondent) in relation to the conduct of the costs Respondent in relation to his application for relief in respect of the termination of his employment made under s.185 of the Act - a matter arising under Part 3-2 of the Act.

[2] The s.394 application of the costs Respondent was dismissed in my decision of 11 December 2014 1 on the basis of the evidence and submissions before me at the time of a hearing on 4 December 2014, in circumstances where the costs Respondent failed to attend the hearing and, when given an opportunity to do so by way of correspondence of 5 December 2014, was unable to reasonably explain his failure to do so.

[3] The costs application was made in the course of the 4 December 2014 hearing.Correspondence dated 5 December 2014, the costs Respondent was afforded an opportunity to put submissions in relation to the costs application. In making its costs application and putting its submissions in support on 4 December 2014, the costs Applicant waived its right to put reply submissions in order to avoid additional costs. 2 The costs Applicant advised that it continued to press its application for costs following my 11 December 2014 decision.3

[4] On 7 December 2014, the costs Respondent replied to my 5 December 2014 correspondence in relation to his failure to attend the hearing of 4 December 2014. His correspondence dealt with the circumstances of his non-appearance on 4 December 2014, including issues concerning representation and his lack of understanding of the processes around the 4 December 2014 hearing, the circumstances of his termination and a request that he be afforded an opportunity to argue his case. To the extent that the correspondence dealt with issues relevant to the costs application, I have taken them into account for the purposes of this decision.

[5] In fact, by way of my correspondence of 5 December 2014 and my decision of 11 December 2014, the costs Respondent was afforded an opportunity to put submissions in relation to the costs application by 19 December 2014.

[6] Submissions were made by him on 18 December 2014. The submissions went to his financial circumstances, the conduct of the costs Applicant’s solicitors, the merit of his substantive application and included a further request to be heard on his substantive application. To the extent that the correspondence dealt with issues relevant to the costs application, I have taken them into account for the purposes of this decision.

[7] My Associate advised the costs Respondent on 18 December 2014 that his substantive application had been dismissed for the reasons set out in my 11 December 2014 decision, referred him to the Fair Work Commission Practice Note in respect of appeals and provided him with an opportunity to apply for an extension of the date (19 December 2014) for putting submissions in relation to the costs application, should he wish to do so.

[8] No request to extend the date for the receipt of submissions on the costs application was made by the costs Respondent and no further submissions were provided by him.

[9] The costs application is made in reliance on s.400A of the Act in relation to costs incurred by it because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter. Section 400A provides:

“(1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter.

(2) The FWC may make an order under subsection (1) only if the other party to the matter has applied for it in accordance with section 402.

(3) This section does not limit the FWC’s power to order costs under section 611.”

[10] The basis of the application for costs is recorded in my decision of 11 December 2014:

“[35] In support of its costs application, the Respondent relied on a 21 November 2014 letter to the Applicant from its solicitors which was emailed to the Applicant and posted to the last known address of the Applicant as it appeared on the Notice of Ceasing to Act filed by the Applicant’s former solicitors. The letter noted that the Applicant had not complied with directions on 22 October 2014 to file further evidence and submissions. The respondent relied in particular on points 4 and 5 of the letter, which advised:

‘4. We request you confirm by 5.00pm on Monday 1 December 2014 that you still intend to prosecute your application at the Fair Work Commission.

5. Please note that if you do not appear at the hearing scheduled for Thursday 4 December 2014, our client reserves its rights to seek an order for its costs thrown away as a consequence of your non appearance.’

[36] The Respondent submitted that the failure of the Applicant to respond to its letter in relation to point four and his non-attendance on 4 December 2014 had caused costs to be “thrown away” in respect of preparation for the hearing on 4 December 2014 and the appearance of the Respondent’s Counsel on 4 December 2014.

[37] The Respondent submitted that the Applicant’s failure to appear was an unreasonable act in circumstances where he was put on notice (letter of 21 November 2014) that if he did not appear he would be liable for an order for costs to be made. It submitted that the failure to respond to the Respondent’s attempt to confirm whether the Applicant still intended to prosecute his claim left the Respondent with no alternative but to be ready for the hearing on 4 December 2014, to prepare for the hearing and to engage Counsel to be ready to appear on 4 December 2014.

[38] The Respondent sought an order for costs in respect of those costs incurred by the Respondent after 5.00 p.m. on Monday, 1 December 2014 for preparation undertaken on the two following days (2 and 3 December 2014) and Counsel’s brief for 4 December 2014, which costs were “thrown away” by the Applicant’s omission/unreasonable act.”

[11] The “unreasonable act or omission” of the costs Respondent relied on by the costs Applicant in connection with the conduct or continuation of the matter which caused it to incur costs were the failure of the costs Respondent to respond to its 21 November 2014 letter by the date of 1 December 2104 nominated in the letter and the failure of costs Respondent to attend at the hearing of 4 December 2014, causing the costs Applicant to incur costs in preparing for the hearing of 4 December 2014 and in briefing counsel for the hearing of 4 December 2014.

[12] In his correspondence of 7 and 12 December 2014 the costs Respondent made a number of assertions relevant to his conduct in respect of the hearing of 4 December 2014 relevant to the costs application:

● He was required on Friday, 28 November 2014 to deposit an additional $10,000 into his barrister’s account to secure representation, which he was unable to do, such that he could no longer obtain representation by the barrister for the hearing of 4 December 2014;

● His lack of understanding of the Act and the jurisdictional objection by the costs Applicant to his substantive application and the processes around the 4 December 2014 hearing;

● Financial difficulties, such that he had no money to support himself;

● The effect of the financial difficulties, resulting in changes in his place of residence on three occasions between the termination of his employment on 24 April 2014 and the hearing of 4 December 2014, and the absence of internet access at some times during that period, both of which affected the receipt of materials in relation to his application and the inability to continue with legal representation which, until 28 November 2014, he believed he had available.

[13] Although assertions, I am able to accept them in light of the waiver of the costs Applicant to its right to put reply submissions, 4 including challenging matters asserted by the costs Respondent.

[14] In relation to the issue of the late inability to maintain legal representation, a related issue arose in respect of an earlier hearing date of 24 October 2014, which was adjourned, upon a 21 October 2014 request of the costs Respondent, on the basis of the cessation of representation by his solicitors on 20 October 2014. In the application for adjournment, the costs Respondent indicated that he had insufficient time to prepare to represent himself but given access to his superannuation in about four weeks, he would be able to pay his barrister and continue with his case.

[15] The costs Respondent asserted confusion in relation to the hearing of 4 December 2014, is supported by the terms of his request for an adjournment of that hearing at 2.09 a.m. on the morning of the hearing.

[16] The making of an order for costs under s.400A of the Act involves both a jurisdictional element – satisfaction that the party against whom an order is sought caused the relevant costs to be incurred because of an unreasonable act or omission by that party in connection with the conduct or continuation of the matter – and, if the jurisdictional requirement is met a discretionary decision to make such an order.

[17] Section 400A was included in the Act as a result of the Fair Work Amendment Act 2012. The purpose of s.400A as explained in the Explanatory Memorandum, 5 “is to address the small proportion of litigants who pursue or defend unfair dismissal claims in an unreasonable manner” – is not “intended to prevent a party from robustly pursuing or defending an unfair dismissal claim” and is “only intended to apply where there is clear evidence of unreasonable conduct by the first party”.6 The “power to award costs under this provision is discretionary”.7 An unreasonable act or omission is “intended to capture a broad range of conduct, including a failure to discontinue an unfair dismissal application made under section 394 and a failure to agree to terms of settlement that could have led to the application being discontinued”.8 “What is an unreasonable act or omission will depend on the particular circumstances but it is intended that the power only be exercised where there is clear evidence of unreasonable conduct by the first party”.9

[18] In the circumstances of this application, the costs Applicant relies on the failure of the costs Respondent to respond to the letter of 21 November 2014 by the date of 1 December 2104 nominated in the letter and the failure of costs Respondent to attend at the hearing of 4 December 2014 as an unreasonable act or omission on his part. In respect of the failure to respond to the 21 November 2014 letter, I am not satisfied this is the case. There is no basis to find that the pursuit of his application was unreasonable It is clear that the costs Respondent intended to pursue his application. Indeed, until Friday 28 November 2014 the costs Respondent intended to rely on legal representation to do so. On the information he asserted, on 28 November 2014, the costs Respondent was asked to provide additional costs of representation and was unable to do so. Up to that point the response to the costs Applicant’s letter of 21 November 2014 would have been “I will see you in the Commission, with my barrister”. Thereafter, the costs Respondent sought to proceed with his application, without representation, until by 2.09 a.m. when, uncertain as to what was required of him and his ability to represent himself, he sought an adjournment of the hearing scheduled to commence eight hours later. Even then he wished to continue with his application and sought an adjournment to allow him to better do so. The adjournment request reflected confusion on the part of the costs Respondent, a lack of the skills required to put his case, and the relatively late change to his plan to have his case put by a legal representative, rather than unreasonable conduct on his part. In his adjournment request, the costs Respondent asserted his continuing desire to prove his case, but a lack of preparedness to do so, in light of the absence of legal representation which came apparent on 20 November 2014. In those circumstances, I am not satisfied that the costs Respondent’s failure to respond to the cost Applicant’s deadline in its 21 November 2014 was unreasonable conduct on his part.

[19] The failure of the costs Respondent to attend the 4 December 2014 hearing was unreasonable. His 2.09 a.m. emailed application for an adjournment was refused at 8.14 a.m., with advice that the hearing would proceed at 10.00 a.m. that morning, unless consent between the parties for an adjournment was reached, with the adjournment application to be dealt with at the commencement of the hearing. It was unreasonable conduct by the costs Respondent, having had his written adjournment application declined, to not attend the hearing to argue his adjournment application and, if unsuccessful, to argue his case as best he could. It was unreasonable for the costs Respondent to take the matter into his own hands, without regard to the Commission and the employer party. As a result of his failure to attend the hearing, the costs Respondent denied himself an opportunity to pursue his adjournment application and, if unsuccessful, to resist the jurisdictional objection brought against him and to pursue his substantial application. However, I am not satisfied that his unreasonable conduct caused the costs Applicant to incur costs preparing for the hearing or briefing Counsel to appear.

[20] I am not satisfied that the costs Respondent caused costs to be incurred by the costs Applicant because of an unreasonable act or omission of his part in connection with the conduct or continuation of the matter.

[21] The cost application is dismissed.

SENIOR DEPUTY PRESIDENT

 1   [2014] FWC 8940.

 2   Transcript at paras 108–109.

 3   Correspondence of 12 December 2014.

 4   Transcript at paras 108–109.

 5   Fair Work Amendment Bill 2012, Explanatory Memorandum.

 6   Fair Work Amendment Bill 2012, Explanatory Memorandum at para 169.

 7   Fair Work Amendment Bill 2012, Explanatory Memorandum at para 170.

 8   Fair Work Amendment Bill 2012, Explanatory Memorandum at para 170.

 9   Fair Work Amendment Bill 2012, Explanatory Memorandum at para 171.

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