Hutcheon v Day

[2014] QIRC 170

QUEENSLAND INDUSTRIAL RELATIONS COMMISSION

CITATION:	Hutcheon v Day [2014] QIRC 170
PARTIES:	Hutcheon, Bruce Eric
(applicant)
v
Day, Graeme Noel
(respondent)
CASE NO:	B/2014/32
PROCEEDING:	Application for costs
DELIVERED ON:	27 October 2014
HEARING DATE:	17 October 2014
MEMBER:	Deputy President O'Connor
ORDER:	Application dismissed
CATCHWORDS:	INDUSTRIAL LAW - APPLICATION FOR COSTS - Whether the substantive application was made vexatiously or without reasonable cause
Industrial Relations Act 1999, s 335
CASES:	Day v Hutcheon [2014] QIRC 84
Gersten v Cape York Land Council Aboriginal Corp
(No 2) (2004) 176 QGIG 153
MIM Holdings Ltd v Automotive, Metals, Engineering, Printing and Kindred Industries
Industrial Union of Employees, Queensland (2000) 164 QGIG 370 Rogers v The Queen (1994) 181 CLR 251 Walters v BT Equipment Pty Ltd (No 2) (2002) 169 QGIG 227
APPEARANCES:	Mr S. J. English for the applicant, directly instructed. Ms C. N. Hartigan, instructed by Thynne & Macartney as town agent for CG Gillis & Co, for the respondent.

Report on Decision (as edited)

In giving his decision from the Bench on 17 October 2014, Deputy President O'Connor stated:

"This is an application for costs made by the respondent in the matter of Day v Hutcheon [2014] QIRC 84. It's agreed between the parties that the application seeks the following:

1.       By application filed 23 June 2014, costs in the order of $9,020, or such other amount the Commission may considers appropriate;

2.       By application filed 8 August 2014, inter alia directions be given for the timely continuance of the proceedings, costs of the application and any other such orders as the Commission considers appropriate;

3.       By the affidavit sworn on the 29th of September 2014 seeking the further costs of $1,418, being counsel's fees incurred between the period of 20 June 2014 and 11 October 2014.

The respondent in these proceedings is Karen Lee Johnston as the executor of the estate of the late Graeme Noel Day. The respondent naturally resists the application for costs.

The Commission has power pursuant to s 335 of the Industrial Relations Act 1999 to make an award for costs in limited circumstances. Section 335 relevantly provides as follows:

"(1) The court or Commission may order a party to an application to pay costs, including witness expenses and other expenses, incurred by

another party only if satisfied–

(a) the party made the application vexatiously or without reasonable

cause; …"

His Honour President Hall in MIM Holdings Ltd v Automotive, Metals, Engineering, Printing and Kindred Industries Industrial Union of Employees, Queensland (2000) 164 QGIG 370 wrote:

'As a matter of first impression, the purpose of s 335 seems to be to spare parties the rule of having the pay the costs of an opposing party whilst providing a measure of protection to parties defending proceedings which have been instituted vexatiously or without reasonable cause.'

His Honour went on to note:

'I am reluctant to construe the provisions in such a way that a successful applicant (respondent) would always be subject to the (proper) exercise of discretion, recover costs of the appeal and the application whilst a successful applicant (applicant) would never do so. It seems to me to be more likely that section 335(1)(a) is aimed at the case which was objectively recognisable as one which could not succeed at the time when the application was made.'

In that case his Honour, the President, was inclined to the view that the phrase 'vexatiously or without reasonable cause' was to be read in a disjunctive and not a composite sense. Vexatious in the context of s 335(1) means instituting a matter with the intention of annoying or embarrassing the respondent or for some collateral purpose. A respondent is required to make out a case before the Commission to justify it making an order under this section.

The submissions made to me on behalf of the applicant refer to both aspects of 335(1) of vexatiousness and without reasonable cause. As I noted previously, whilst there was some acrimony between the parties, that of itself does not necessarily lead to the conclusion that the application was brought vexatiously. As the President noted in Gersten v Cape York Land Council Aboriginal Corp (No 2) (2004) 176 QGIG 153, it must be brought with an intention of annoying or embarrassing the respondent for some collateral purpose which could amount to vexatious behaviour.

No evidence before the Commission leads me to that conclusion. I cannot, therefore, be satisfied that at the time of instituting these proceedings there was an intention of annoying or embarrassing the respondent for some collateral purpose which could amount to vexatious behaviour.

I accept, as I noted previously, that there was a level of acrimony between the parties. My conclusion, after hearing the evidence, was that the parties had reached a point where both sides had taken quite distinct and opposite views as to the factual background as to their relationship. Turning to the second aspect of 335(1), "without reasonable cause": an application will only be unreasonably made if it can be said to be objectively recognised as one which could not succeed.

The Full Bench of this Commission in Walters v BT Equipment Pty Ltd
(No 2) (2002) 169 QGIG 227 said as follows:

'The purpose of 335(1) is, plainly enough, to free parties from the risk of having to pay the cost of an opposing party without giving some measure of protection to parties defending proceedings which have been instituted vexatiously or without reasonable cause.'

In that matter, the application for a leave to appeal was neither vexatious nor made without reasonable cause. The most severe criticism which the Full Bench could make of the application for leave was that the applicant's legal advisors made a forensic error in the construction of a novel, clumsily drafted and untested statutory provision. They went on to conclude that:

'An application was not arguable, may only be reached by basking in the
wisdom of hindsight. There was no vexation or abuse of process.'

I am of a similar view in the current matter. There were clearly matters before the Commission which required its determination as to whether one aspect or another of the evidence which was presented to it should be accepted. As was noted in my reasons for decision, I was required to assess when determining the application of s 278 of the Industrial Relations Act 1999 whether or not, on the balance of probabilities, the wages were due under a contract of employment.

As I noted in my reasons for decision, and after referring to the relevant authorities, an application under s 278 of the Act must establish that wages are due and payable under a contract of employment. An employee whose employment is covered by an industrial instrument may establish the minimum terms of the contract by reference to those terms, but as I noted, and as was agreed between the parties, this was not such a matter.

What was required here was, as the employee in these circumstances or the applicant, was not covered by an industrial instrument, it was necessary for me to determine on the balance of probabilities, after considering all of the evidence, whether there was enough for me to conclude that there were wages due under a contract of employment and that they were unpaid, and where the terms of the contract of employment are in dispute, as they were in the matter before me, whether there was sufficient to establish that those terms on the balance of probabilities.

There was sufficient evidence before me to come to the conclusion that this was not, at the time of making this application, a case which did not have some reasonable prospect of success.

It was further argued before me this morning to encourage me to consider whether or not the discretion conferred on the Commission under s 335(1) should be exercised was that there was a suggestion that the processes adopted by the applicant amounted to an abuse of process. Counsel for the applicant referred in his written submission to the relevant authorities, in particular, Rogers v The Queen (1994) 181 CLR 251, and drew my attention to the decision of Mason J and also to the dissent of McHugh J.

Mason J in that matter said there were two aspects to an abuse of process: 'first, the aspect of vexation and oppression and unfairness to the other party to the litigation, and, secondly, the fact that the matter complained of would bring the administration of justice into disrepute.' Having had the opportunity of listening to all of the evidence in this application, and after consideration of the authorities, I am not satisfied that there could be said in this matter to have been an abuse of process.

Having regard to the evidence, considering the discretion granted to me under s 335(1) and after considering the submissions of both the applicant and the respondent, I am not of the opinion that this is an appropriate matter in which (a) the discretion has been enlivened, and (b) even if it was so enlivened, that it is sufficient for me to make the orders that are sought.

Accordingly, I do not propose to make an order for costs pursuant to the provisions

of s 335(1) of the Act, and, therefore, the application for costs is refused."