Jeffrey Vassallo v Easitag Pty Ltd

[2021] FWC 3479

[2021] FWC 3479

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.603 - Application to vary or revoke a FWC decision

Jeffrey Vassallo
v
Easitag Pty Ltd
(C2020/6254)

COMMISSIONER CIRKOVIC MELBOURNE, 17 JUNE 2021

Application for costs - section 611 - indemnity costs - vexatious - without reasonable cause - no reasonable prospect of success - costs orders made.

[1] This decision concerns an application by Easitag Pty Ltd (Easitag / the Costs Applicant), for an order for indemnity costs against Mr Jeffrey Vassallo (the Applicant / Mr Vassallo / the Costs Respondent) which it incurred in defending an action commenced by the Costs Respondent, pursuant to s 603 of the Fair Work Act (the FW Act) (the Costs Respondent’s s.603 Application). Alternatively, the Costs Applicant, seeks an order for costs on a party/party basis against the Costs Respondent.

[2] The Costs Applicant seeks costs orders against the Costs Respondent on the following grounds:

(a) under section 611(2)(a) of the Fair Work Act 2009 (FW Act) on the basis that the Costs Respondent made his application vexatiously;

(b) under section 611(2)(a) on the basis that the Costs Respondent made his Application to vary or revoke an FWC decision was without reasonable cause;

(c) under section 611(2)(b) on the basis that it was reasonably apparent to the Costs Respondent that the Application had no reasonable prospects of success

Background

[3] On 12 January 2021, the Commission, as presently constituted , issued a decision (s.603 decision) 1 dismissing the Cost Respondent’s s.603 Application .The Cost Respondent’s application was made on 10 August 2020 pursuant to s.603 of the FW Act to vary or revoke the decision of the Commission as presently constituted in Jeffrey Vassallo v Easitag Pty Ltd t/a Easitag (original Decision).2 On 31 January 2021, the Costs Respondent lodged an appeal with respect to the s.603 application pursuant to s.604 of the FW Act. On 2 June 2021, the Full bench of the Commission3 dismissed the Costs Respondent’s appeal (the full bench decision),4 noting that:

“[7] We consider that the approach taken by the Commissioner to the consideration of Easitag’s application under s 587 was entirely orthodox. Such applications generally face a high hurdle, however in the present case we consider that it was clearly open to the Commissioner to reach the conclusion that the proceedings were groundless and vexatious. She considered Mr Vassallo’s additional evidence and found it of little assistance to his case. She heard Mr Vassallo’s argument about why he sought now to resile from the agreed position that he was covered by the Award but was not persuaded by it. She did not accept Mr Vassallo’s contentions that the employer had misled the Commission. What remained of Mr Vassallo’s application was his fundamental disagreement with the outcome of the 2017 decision. In such circumstances, it was plainly open to the Commissioner to dismiss the application under s 587.

[4] Given the extensive history of the matter before me, for convenience, I have set out below the relevant background set out in the s.603 decision as follows:

“[16] It is uncontroversial to say that the facts relating to this matter have been the subject of extensive legal proceedings. In addition to the Application there has been:

•  a proceeding before the Commission in 2017 (C2017/227);

•  the subsequent Full Bench appeal (C2017/6484);

•  a recent application before the Commission under section 608 of the Act; and

•  proceedings in the Federal Court of Australia which, I am informed by the parties, are ongoing.

Original Decision

[17] On or around 6 May 2008, the Applicant commenced his employment with the Respondent as a Victorian Technician. 5

[18] On 13 January 2017, the Applicant made an application under section 739 of the Act to deal with a dispute under the Electronic Communications and Contracting Award 2010 (Modern Award) and its predecessor the National Electronic Communications Contracting Industry Award 1998 (Pre-modern Award).

[19] During the course of this proceeding, both parties were legally represented by Counsel and instructing solicitors.

[20] As part of these proceedings, the following matters were agreed between the parties:   

•  the matter would be resolved via consent arbitration;

•  the role of the Commission was to resolve the dispute between the parties as to whether the Applicant was a Grade 4 under the Modern Award or a Grade 10 under the Modern Award;  6

•  the Applicant’s position was initially covered by the Pre-modern Award;  7 and

•  the Applicant’s position was, at the time of the proceedings, covered by the Modern Award.  8

[21] In the Original Decision, the dispute between the parties was resolved as follows:

“In summary, when all the evidence regarding the functions and responsibilities of the role of Victorian technician have been considered and assessed against the relevant terms of the Award the answer to the issue in dispute between the parties is that the correct classification of the Applicant’s position is Electrical Worker Grade 4.”. 9

Appeal of Original Decision

[22] On 24 November 2017, the Applicant lodged a notice of appeal with respect the Original Decision pursuant to section 604 of the Act.

[23] On 24 January 2018, the Full Bench of the Commission (Gostencnik DP, Colman DP and Bissett C) dismissed the Applicant’s appeal, concluding that:

“The Commissioner’s approach to the interpretation of the Award was correct. She determined the dispute referred to her under the disputes procedure in the Award, in accordance with that term and within the scope of the parties’ consent to arbitration. We do not identify any error on the part of the Commissioner in the conduct of the proceeding or her analysis and determination of the dispute before her.” 10

Applicant’s proceedings in the Federal Court of Australia

[24] On 28 May 2018, the Applicant commenced proceedings in the Federal Court of Australia by way of application and statement of claim. Alleged in the pleadings for this matter was that, amongst other things, the Applicant had been underpaid under the Modern Award by not receiving pay rates consistent with, alternatively, an Electrical worker level 10, 7, 6, 5 or 4. 11

[25] The Respondent denied the alleged underpayments and posited that, by virtue of the Original Decision, the Applicant was estopped from pursuing these proceedings.

[26] On 23 June 2020, Kerr J handed down his judgment in Vassallo v Easitag Pty Ltd [2020] FCA 875 (Federal Court Judgment) in which he stated at [28] – [30]:

“28. Permission to appeal having been refused by the Full Bench, the outcome of the arbitration created a cause of action estoppel. Consistently with the principles articulated in Guba and TCL the Respondent was entitled, there being nothing asserted by the Applicant as to a relevant change of circumstances, to plead that estoppel to prevent the same question being re-agitated in these proceedings. In my view the Respondent is correct that permitting the same issue to be revisited is impermissible for the reasons the Chief Justice identified in Guba. The doctrine as reaffirmed in TCL exists to prevent the same issue being re-agitated in a court once finally determined in an arbitration.

29. For completeness, lest I be in error in my principal conclusion, I should record that had I not been satisfied to the requisite degree that the arbitrator did make an actual finding that the correct classification of the Applicant was Electrical Worker Grade 4, I would have concluded that there was no abuse of process in Mr Vassallo seeking to have this Court determine whether his correct classification was Electrical Worker Grade 5,6, or 7.

30. In my view had the arbitration not expressly so concluded, no issue of a wider Henderson ((1843) 3 Hare 100; 67 ER 313) or Anshun ([1981] FCA 45; 147 CLR 589) estoppel would have prevented that course. The burden of establishing that the Applicant would have been entitled to, but unreasonably had refrained from, putting those questions in issue would have been on the Respondent. Where a submission to arbitration requires a mutual rather than a unilateral act, it cannot be inferred from the mere absence of a submission that the failure to raise a particular issue for determination was the responsibility of the other party. The Respondent led no evidence, and none appears in the materials, that would enable the Court to conclude that it was Mr Vassallo who had insisted that no reference to any intermediate classifications would be included in their mutual submission to arbitration in the FWC.”

Application under section 608 of the Act

[27] For completeness, I note that on 24 September 2020, the Applicant wrote to the chambers of Ross J, President of the Commission, seeking for two questions of law to be referred to the Federal Court of Australia pursuant to section 608 of the Act. On 15 October 2020, a hearing was held at which Ross J delivered his decision on transcript dismissing the application.”

[5] On 27 January 2021, the Costs Applicant applied for costs, being the subject of this decision. On 9 February 2021, I granted a request from the Costs Respondent to adjourn the costs application, to allow for the conclusion of the Costs Respondent’s full bench appeal.

[6] By consent of the parties it was decided that the costs application would be determined ‘on the papers’. 12 On 1 April 2021, the Costs Applicant lodged proposed draft orders for the conduct of the costs application – the Costs Respondent did not comment. On 7 April 2021, I issued Directions in the terms of the Costs Applicant’s proposal.

[7] On 19 April 2021, in compliance with my Directions, the Costs Applicant filed an outline of submissions in support of their costs application, and a witness statement, signed on 19 April 2021, of Lisa-Marie Parks, solicitor of Blue Rock Law with conduct of the matter on behalf of Easitag.

[8] On 29 April 2021, in compliance with my Directions, the Costs Respondent filed an outline of submissions to dismiss the costs application.

[9] On 27 August 2020, I conduced an initial mention hearing in relation to the s.603 application. At this hearing I heard the parties on the question of representation by a lawyer or paid agent under s. 596 of the FW Act. I issued a decision during the mention hearing, granting the Costs Applicant permission to be legally represented.

[10] Notwithstanding my ex tempore decision, following the hearing, the Costs Respondent sought to reagitate the issue by filing submissions opposing the Costs Applicant being represented. In summary, the argument advanced was that the matter would not be dealt with more efficiently, the Costs Applicant was able to effectively represent themselves, unfairness as between the parties, and that allowing one side representation while the other is not represented means that only the represented side can pursue costs, resulting in “undue pressure” being placed on the Costs Respondent.

[11] On 28 August 2020, through my Chambers, I communicated to the parties that the Costs Respondent’s submissions had not convinced me to disturb my original decision. The Costs Respondent did not seek to reagitate the issue in relation to the costs application at any stage, including after receiving the costs application, the consent directions, nor after receiving the Costs Applicant’s submissions and evidence, all of which being filed by the Costs Applicant’s representatives. It follows that my decision made on 27 August 2020, under s. 596 granting permission for the Costs Applicant to be legally represented, on the ground of efficiency, continues to apply in this application.

[12] I note for completeness that on 15 October 2020 President Ross refused the Costs Applicant permission to be represented in a hearing to determine an application made under s. 608 by the Costs Respondent. While the s. 608 application was administratively managed under the same matter number as the s. 603 application, and this costs application, 13 his Honour’s decision does not, in my view, disturb my grant of permission.

Submissions of the parties.

[13] The Costs Applicant filed written submissions and an affidavit of Lisa-Marie Parks, in support of its application. The Costs Applicant’s submissions are set out below:

•  First, the Costs Applicant submits that the s 603 application was made vexatiously or without reasonable cause, and in support of this submission, it advances the following;

(a) In [2021] FWC 132, (“the Decision”) the Commission found that the s.603 application was groundless and “an abuse of process, and? vexatious” and dismissed the same under s.587(1)(b) of the FW Act “[p]ermission to appeal the Decision was refused by the Full Bench on 23 March 2021.”

(b) further or alternatively the s.603 application was ‘without reasonable cause’; the application had no substantial prospects of success and, objectively, that fact ought to have been reasonably apparent to the Applicant at the time of initiating the s.603 application for the following reasons;

(i) the Applicant did not seek judicial review of the Full Bench decision in Jeffrey Vassallo v Easitag[2018] FWCFB 501 (Full Bench Proceedings);

(ii) the finding of His Honour Justice Kerr in Vassallo v Easitag Pty Ltd (Federal Court Decision) that the Applicant be estopped from re-agitating the same Award classification question by virtue of the decisions of the Commissioner in Jeffrey Vassallo v Easitag Pty Ltd[2017] FWC 5961 (Original Proceedings) and Full Bench Proceedings;

(iii) the Applicant was legally represented in the Federal Court Decision and at the time of initiating the s.603 Application; and

(iv) the Applicant alleged he was underpaid as a Grade 4 Electrical Worker under the Electrical Electronic Communications Contracting Award 2010 (EECCA) in the Federal Court proceedings numbered VID 461 of 2018 (Federal Court Proceedings) and did not resile from this position.

[14] Secondly, the Costs Applicant submits that the s.603 application had no reasonable prospect of success. In support of this submission the Costs Applicant submits that:

•  Following the initiation of the s 603 application, by letter dated 19 August 2020 addressed to the Costs Respondent’s former legal representative, the Costs Applicant put the Costs Respondent on notice that it would pursue costs on an indemnity basis against the Costs Respondent, and set out the basis for the costs application and invited the Costs Respondent to discontinue the s.603 application:

•  On 24 September 2020, the Costs Respondent made an application pursuant to s.608 of the FW Act (S.608 Application) seeking to refer two (2) questions to the Federal Court as to whether he was covered by the EECCA (as was the consent position in the Original Proceedings) or the Manufacturing and Associated Industries and Occupations Award 2010 (MAIOA) ;

•  On 5 October 2020, an interlocutory application in the Federal Court Proceedings seeking determination of coverage under the EECCA (as had been ventilated in the Original Proceedings, the Full Bench Proceedings, and the Federal Court Decision), coverage under the MAIOA and entitlements under the MAIO sentence doesn’t appear to finish;

•  The s.608 application was dismissed by the Honourable Justice Ross. 14

[15] The Costs Respondent filed written submissions which I have reproduced below. I note that the Costs Respondent’s submissions are not fully developed and do not appear to engage directly with the principles relevant to s.611 of the FW Act. Rather, the Costs Respondent extracts the Fair Work Commission Rules 2013, specifically, rules 8, 11, and 12A, and states that:

“5. I submit that the Respondent did not comply with the FWC rules and did not submit, file or serve the approved form being the F53 to the Fair Work Commission or myself prior to the commencement of these proceedings. in accordance with the Fair Work Commission Rules 2013 and the Fair Work Act 2009 (Cth).

There is no discretion in the word "must"”

[16] He then extracts sections 585, 587, and 739(5), and states that:

“9. The Respondent did not comply with Rule 11 and 12A of the Fair Work Commission Rules 2013 and s 585 of the Fair Work Act 2009 (Cth) and as such is not entitled to any costs.

10. In accordance withs 587 of the Fair Work Act 2009 (Cth) the FWC ought dismiss the Respondent's Application for costs.”

Legislation

[17] Section 611 of the FW Act provides as follows:

“611 Costs

(1) A person must bear the person’s own costs in relation to a matter before the FWC.

(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:

(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.

Note: The FWC can also order costs under sections 376, 400A, 401 and 780.

(3) A person to whom an order for costs applies must not contravene a term of the order.

Note: This subsection is a civil remedy provision (see Part 4 1).”

[18] The power to award costs was considered by a Full Bench of the Commission in Luke Tamu v World Vision Australia, 15 where the Full bench summarised the relevant principles and considered the authorities below:

“[15] In Hansen v Calvary Health Care Adelaide Limited  16a Full Bench said in relation to s 611 generally:

“[15] It is trite to observe that the statutory and policy imperative underpinning a costs application under the Act, is that a person in a matter before the Commission must bear their own costs. So much is plainly obvious by the precise and unambiguous language of s 611(1).

[16] However, the statutory scheme sets out the relatively circumscribed circumstances in which an order for costs might be found by the Commission to be appropriate in a particular case. It includes the exercise of discretionary power where the Commission is satisfied that one, or more of the circumstances set out in s 611(2), has been established. If such circumstances are established, the Commission, in the broad exercise of its discretion, may make an order that a person/s bear some, or all of the costs of another person, in relation to the application, including on an indemnity basis, or decline to make any order at all.”

[19] The relevant principles concerning the interpretation and application of s 611(2)(a) were comprehensively stated in Church v Eastern Health t/as Eastern Health Great Health and Wellbeing (Church)  17and may be summarised as follows:

•  An application is made vexatiously when the predominant motive or purpose of the applicant is to harass or embarrass the other party or to gain a collateral advantage.

•  An application is not made without reasonable cause simply because the application did not succeed.

•  Whether an application is made without reasonable cause may be tested by asking, on the facts apparent to the applicant at the time the application was made, whether there was no substantial prospect of success.

•  If success depends upon the resolution in the applicant’s favour of one or more arguable points of law, it is inappropriate to characterise the application as having been made without reasonable cause.

•  In relation to an appeal, the question becomes whether the appeal has no substantial prospect of success. The prospect of success must be evaluated in the light of the facts of the case, the judgment appealed from and the points taken in the notice of appeal. If there is a not insubstantial prospect of the appeal achieving some success, it cannot fairly be described as having been made without reasonable cause.

•  An application will have been made without reasonable cause if it can be characterised as so obviously untenable that it cannot possibly succeed, is manifestly groundless or discloses a case where the tribunal is satisfied it cannot succeed.

[20] In relation to s 611(2)(b), the relevant principles were summarised by the Full Bench in Baker v Salva Resources Pty Ltd  18as follows (footnotes omitted):

“[10] The concepts within s.611(2)(b) ‘should have been reasonably apparent’ and ‘had no reasonable prospect of success’ have been well traversed:

•  ‘should have been reasonably apparent’ must be objectively determined. It imports an objective test, directed to a belief formed on an objective basis, rather than a subjective test; and

•  A conclusion that an application ‘had no reasonable prospect of success’ should only be reached with extreme caution in circumstances where the application is manifestly untenable or groundless or so lacking in merit or substance as to be not reasonably arguable

[21] I respectfully adopt the Full Bench’s approach in coming to my decision.

Principles - Indemnity Costs

[22] The power to award indemnity costs was considered by Jones C (as she then was) in Stanley v QBE. 19 At paragraphs 24 - 27 the Commissioner helpfully set out the relevant authorities on this point starting with an excerpt from Anita Goffett v Recruitment National Pty Ltd:20

“[49] In Australian Transport Insurance Pty. Ltd. v Graeme Phillips Road Transport Insurance Pty. Ltd Woodward J dealing with a costs application in the Federal Court of Australia isolated the following principle in relation to indemnity costs:

“Courts in both the United Kingdom and Australia have long accepted that solicitor and client costs can properly be awarded in appropriate cases where ‘there is some special or unusual feature in the case to justify the court exercising its discretion in that way’ (Preston v Preston (1982) 1 All ER 41 at 58). It is sometimes said that such costs can be awarded where charges of fraud have been made and not sustained; but in all the cases I have considered, there has been some further factor which has influenced the exercise of the court’s discretion - for example, the allegations of fraud have been made knowing them to be false, or they have been irrelevant to the issues between the parties: see Andrews v Barnes (1888) 39 Ch D 133; Forester v Read (1870) 6 LR Ch App Cases 40; Christie v Christie (1873) 8 Ch App Cases 499; Degmam Pty Ltd (In Liq) v Wright (No 2) (1983) 2 NSWLR 354.”

[50] In Oshlack v Richmond River Council, Gaudron and Gummow JJ said:

“It may be true in a general sense that costs orders are not made to punish an unsuccessful party. However, in the particular circumstance of a case involving some relevant delinquency on the part of the unsuccessful party, an order is made not for party and party costs but for costs on a ‘solicitor and client’ basis or on an indemnity basis. The result is more fully or adequately to compensate the successful party to the disadvantage of what otherwise would have been the position of the unsuccessful party in the absence of such delinquency on its part.”

[23] Justice Sheppard said in Colgate-Palmolive Co v Cussons Pty Ltd 21 (Colgate Palmolive):

"... it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion [to award indemnity costs]. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v Weekes (1989) 92 ALR 131 at 152 evidence of particular misconduct that causes loss of time to the court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v Hutchinson (1987) 10 NSWLR 525; Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 at 724(Court of Appeal); Crisp v Kent (SC(NSW)(CA), 27 Sept 1993, unreported) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records)...."

[24] In J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers, Western Australian Branch and Anor (No 2), 22 Justice French said:

"... It is sufficient, in my opinion, to enliven the discretion to award such costs that, for whatever reason, a party persists in what should on proper consideration be seen to be a hopeless case. The case against the BTA was paper thin. ..."

[25] In Commonwealth Bank of Australia v Mohamad Saleh and Ors 23 (Commonwealth Bank decision), indemnity costs were awarded against the defendants, following a finding by the Court that they had sought to defraud the Bank of around $7 million.24 In the decision on costs, Justice Einstein said:

"[5] There is no doubt but that the Bank is entitled to an indemnity costs order against Mr Edge. Not only was he one of the fraudulent conspirators but significantly he sought to rely in the proceedings on documents which were found to be fabricated. He persisted throughout the whole of the hearing in denying the bank's allegations in respect of his fraud: knowing those allegations to be true. This conduct par excellence constituted relevant delinquency. The case for a indemnity costs against him is plainly a fortiori.

[6] Likewise the case for ordering indemnity costs against Mr Qureshi is clearly made out. He also relied upon invoices and time sheets which have been found to have been fabricated and were at the very heart of his defence. He also persisted throughout the whole of the hearing in denying the bank's allegations in respect of his fraud: knowing those allegations to be true. Additionally he persisted in frustrating the Bank's attempts to obtain access to documents required to be produced by the litigious process: see the judgement in respect of the ultimate obtaining of access to the deep memory of the computer and the circumstances in which only during the hearing when in the witness box [initially as part of the voire dire to ascertain the enquiries which he had made in relation to the existence of material documents] did he come forward with the important information concerning how the money which he had received had been expended. This was delinquent conduct. The case for a indemnity costs against him is also a fortiori.

[7] The cases for indemnity costs orders against Mr Mohamad Saleh and Mr Hassanien Saleh are also quite clear. Although they were not any longer represented during the hearing, their pleadings denying the fraud were before the Court and the Bank was required to prove the fraud. Their denial of the fraudulent allegations which they knew to be correctly made and the vast expense which the Bank was required to undertake to prove its case against them clearly mandates an indemnity costs order being made against each of them."

[26] I have adopted the forgoing principles and analysis in coming to my conclusion.

Consideration

[27] In the present matter the Costs Applicant contends that the Costs Respondent commenced the s.603 application vexatiously, ‘without reasonable cause’, within the meaning of s.611(2)(a) and, further, that it should have been reasonably apparent to him that the application had ‘no reasonable prospect of success’, within the meaning of s.611(2)(b).

[28] The Costs Applicant’s submissions correctly referred me to the principles relevant to determining an application under s.611 as summarised in the Full Bench decision of Church. I have set out above the relevant principles and respectfully adopt them in coming to my decision.

Was the Costs Respondent’s Application commenced vexatiously (s.611(2)(a))?

[29] I made the following findings in the s.603 application:

“[43] Having regard to the material before me, I am satisfied that these proceedings are an abuse of process, groundless and vexatious.”

[30] Further, I note the comments of the full bench that, “it was clearly open to the Commissioner to reach the conclusion that the proceedings were groundless and vexatious.” 25

[31] I am satisfied on the basis of the material before me that the s.603 application was commenced vexatiously within the meaning of s.611(2)(a).

Was the Costs Respondent’s application commenced without reasonable cause (s.611(2)(a))?

[32] I have taken into account, the arguments advanced by the Costs Applicant in support of its contention that the Costs Respondent’s application was commenced without reasonable cause.

[33] This is not a case where the Costs Respondent simply advanced an argument before the Commission that was unsuccessful. At the time that the s.603 application was commenced the facts known to the Costs Respondent were no different to those which had previously been advanced in the Commission. Having been unsuccessful at first instance and on appeal, and there having been no change in the factual circumstances, the application had no substantial prospect of success. Further, I note that the Costs Respondent did not seek judicial review of the full bench decision, 26 and the finding of his honour Justice Kerr that the Costs Respondent be estopped from re-agitating the same award classification question.27

[34] As stated above at paragraphs 15 and 16, the Costs Respondent’s submissions are not fully developed and do not engage directly with s.611. To the extent that the Costs Respondent relies on the Costs Applicant’s failure to file a Form 53 notice as required by Rule 11 (1) of the FW Rules, I make the following observations.

[35] , The Costs Applicant’s solicitors wrote to the Costs Respondent’s lawyers on the 19 August 2020 putting the Costs Respondent on notice that it would be seeking indemnity costs against the Costs Respondent if the s 603 application was not discontinued.

[36] The cover letter attaching the letter of 19 August is reproduced below.

“Dear Sirs

“We refer to the above-mentioned matter and advise that we act on behalf of the Respondent, Easitag Pty Ltd.

We note that a mention and/or directions has been listed at 12:30 pm on Thursday 27 August 2020 by telephone before Commissioner Cirkovic.

We advise that Simone Bingham shall appear on behalf of the Respondent and her preferred contact number is XXXXX XXXX.

We also request that you please bring the attached letter to the attention of Commission Cirkovic prior to that mention. A copy of the letter was sent to the Applicant’s legal representatives on 19 August 2020, to which we have received no response.”

[37] To the extent that the Costs Respondent suggests that he was prejudiced by the Costs Respondent’s failure to file an F53 in the s 603 application, I note that the Costs Respondent was on notice, from at least 19 August 2020, that the Costs Applicant was incurring costs for which he could be ultimately liable.”

[38] In my view, the s 603 application was so obviously untenable that it should never have been commenced. It was, in essence nothing more than an attempt to re-litigate claims previously determined (and not disturbed on appeal).

[39] For these reasons, I am satisfied that the Costs Respondent’s application was commenced without reasonable cause within the meaning of s.611(2)(a).

Did the Cost’s Respondent’s Application have no reasonable prospects of success (s.611(2)(b))?

[40] I accept that, at the time that the Cost’s Respondent’s application was commenced each of the matters set out in Respondent’s submissions (summarised above) were known to the Applicant.

[41] Therefore, noting that the application of s.611(2)(b) is an objective test, for the reasons I have explained above, I am satisfied that the Cost’s Respondent’s application was manifestly untenable or groundless or so lacking in merit or substance to be not reasonably arguable. A reasonable person would have concluded that there was no reasonable prospect of success.

[42] Consequently, I am also satisfied that the Costs Respondent’s ’s application had “no reasonable prospects of success” within the meaning of s.611(2)(b) of the FW Act.

Exercise of discretion

[43] As the principles Church direct, the power to award costs pursuant to s. 611 should be exercised with caution, they will only rarely be ordered, and only in a clear case.

[44] In my view this is a clear case, I am satisfied that the discretion to make an order for costs is enlivened.

Indemnity costs

[45] As stated above, the Respondent submits that the Applicant should bear all the costs of the s.603 application on an indemnity basis.

[46] I am satisfied that the Commission has the power to award costs on an indemnity basis, noting that it is exercised rarely. That said, in the circumstances of this case I am satisfied that the necessary high threshold has been reached, such as to order costs on an indemnity basis. I have found that the Cost Respondent’s s.603 Application has been brought vexatiously and had no reasonable prospects of success. I have taken into account that the Costs Respondent was represented in the Federal Court proceeding. In the circumstances of this case, I accept the Cost’s Applicant’s submission that the Cost’s Respondent brought the s.603 Application with the intent to vex. I consider the Costs Respondent’s conduct in bringing and maintaining the s.603 Application warrants an award of indemnity costs.

Conclusion

[47] I am satisfied that it should have been reasonably apparent to the Costs Respondent that his s.603 Application had no reasonable prospect of success at least from 24 August 2020 28 when my Chambers served a copy of the 19 August 2020 letter on Mr Vassallo’s personal email address, wherein the Costs Applicant’s solicitors wrote to the Costs Respondent’s former solicitors putting the Costs Respondent on notice that an application for costs would be made on an indemnity basis and asking the Costs Respondent to discontinue the s.603 application. I am prepared to exercise my discretion and order indemnity costs against the Costs Respondent after that date.

[48] In that regard, I make the following Directions:

•  Easitag Pty Ltd is to file in the Commission and serve on Mr Vassallo an itemised schedule of costs it considers payable within fourteen (14) days of the date of this Decision.

•  Within seven (7) days of receipt of Easitag Pty Ltd’s itemised schedule Mr Vassallo is to file a response in the Commission and serve the response on Easitag Pty Ltd.

•  The quantum of costs will then be settled and Ordered payable by the Commission.

COMMISSIONER

Final written submissions:

Jefferey Vassallo, 29 April 2021.

Easitag Pty Ltd, 19 April 2021.

Printed by authority of the Commonwealth Government Printer

<PR730788>

 1   [2021] FWC 132.

 2   [2017] FWC 5961.

 3   Deputy Presidents Dean, Colman, and Commissioner Platt.

 4   [2021] FWCFB 1554.

 5 Original Decision at [23].

 6   Original Decision at [23]; Consent Position of Parties dated 12 April 2017.

 7   Original Decision at [23]; Consent Position of Parties dated 12 April 2017.

 8   Original Decision at [23]; Consent Position of Parties dated 12 April 2017.

 9 Original Decision at [49].

 10   Jeffrey Vassallo v Easitag Pty Ltd t/a Easitag [2018] FWCFB 501 (Full Bench Decision).

 11   Submissions of the Respondent on the Summary Dismissal of the Application dated 10 September 2020 (Respondent’s Submissions).

 12   See: Emails to Chambers from Costs Applicant on 3 February and 25 March 2021, Email to Chambers from Costs Respondent on 29 March 2021, and Directions of 7 April 2021.

 13   Being C2020/6254.

 14   Decision delivered in transcript of hearing on 15 October 2020.

 15   [2020] FWCFB 5342.

 16   [2016] FWCFB 8162.

 17   [2014] FWCFB 810, 240 IR 377 at [23]-[33]

 18   [2011] FWAFB 4014, 211 IR 374.

 19   [2012] FWA 10164.

 20   [2009] AIRCFB 626

 21 (1993) 46 FCR 225, 233.

 22 (1993) 46 IR 263 at 303.

 23 [2007] NSWSC 990 at [5]-[7].

 24   Commonwealth Bank of Australia v Mohamad Saleh and Ors [2007] NSWSC 903.

 25   Full Bench Decision, [2021] FWCFB 1554, [7].

 26   Jefferey Vassallo v Easitag Pty Ltd, [2018] FWCFB 501.

 27   Vassallo v Easitag Pty Ltd [2020] FCA 875.

 28   It is not clear on the material that the Costs Applicant’s representative served a copy on Mr Vassallo, nor is the status of Mr Vassallo’s representation as at 19 August 2020 clear, nor is it clear whether Mr Vassallo’s (former) representative provided him a copy at this time.