Jenkins v YMCA of Great Lakes Inc. t/as Great Lakes Aquatic & Leisure Centre

[2008] NSWADT 335

CITATION:	Jenkins v YMCA of Great Lakes Inc. t/as Great Lakes Aquatic & Leisure Centre [2008] NSWADT 335
DIVISION:	Equal Opportunity Division
PARTIES:	APPLICANT Tien Sam Jenkins RESPONDENT YMCA of Great Lakes Inc. t/as Great Lakes Aquatic & Leisure Centre
FILE NUMBER:	071107
HEARING DATES:	On the papers
DATE OF DECISION:	16 December 2008
BEFORE:	Perrignon R - Judicial Member; Kelleghan D - Non-Judicial Member; Lowe A - Non-Judicial Member
CATCHWORDS:	Costs
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 Anti-Discrimination Act 1977
CASES CITED:	Tu v University of Sydney (No. 2) [2002] NSWADT 25 Borg v Commissioner, Department of Corrective Services [2003] NSWADT 35 Sebastian v Rail Infrastructure Corporation [2006] NSWADTAT 44 Murtough v NSW Bar Association [2008] NSWADT 166 Dunn v New Group Training Inc [2008] NSWADT 287
REPRESENTATION:	APPLICANT C Adamson, solicitor RESPONDENT D Gunn, solicitor
ORDERS:	1. The proceedings are dismissed pursuant to section 107(1)(a) of the Anti-Discrimination Act 1977 2. Each party shall bear its own costs.

1 The Applicant, Mr. Jenkins, has notified the Tribunal that he does not wish to proceed further. The Respondent, YMCA of Great Lakes Inc., seeks an order for its costs.

2 Mr. Jenkins was employed as a lifeguard by the YMCA, at the Great Lakes Aquatic & Leisure Centre.

3 On 6 June 2007, he complained to the Anti-Discrimination Board that a fellow employee there had called him a “monkey”, and otherwise verbally harassed him. He submitted that this constituted discrimination on the grounds of race, for which his employer was responsible.

4 In his complaint, he indicated that he was born in Vietnam, was of Vietnamese appearance, and had been brought to Australia by boat in 1976 as a baby after the Vietnam War. He was adopted in this country, and was not aware of the fate of his natural parents. He said that, due to the conduct of which he complained, he became depressed and attempted suicide unsuccessfully. He resigned from his employment, and was impoverished as a result. He alleged that no code of conduct in respect of racial harassment had been publicised at his place of employment to his knowledge, and that no relevant training or counselling had been provided to staff.

5 On 13 September 2007, the President of the Anti-Discrimination Board formed the view that the complaint could not be resolved by conciliation, and referred it to the Tribunal for inquiry pursuant to section 93C(a) of the Anti-Discrimination Act 1977. The inquiry has not yet been heard by the Tribunal.

6 On 20 August 2008, Mr. Jenkins notified the Tribunal of his intention to withdraw. By his solicitor, he has indicated an intention to commence similar proceedings in the federal jurisdiction, because the limit on damages in that jurisdiction is less restrictive than the limit imposed by the Anti-Discrimination Act 1977 (NSW).

7 The YMCA submits, in effect, that Mr. Jenkins has commenced proceedings in this jurisdiction in error, that it should not have been put to the cost of defending them, and that it is appropriate for Mr. Jenkins to pay its costs of doing so.

8 The YMCA relies on an affidavit sworn by its solicitor. The grounds for its application are summarised in paragraph 12 of its written submissions, as follows:

“(1) The complaint is and was always lacking in substance;

(2) The complaint appears to be misconceived;

(3) Dismissal of the proceedings would be warranted under section 102 of the Anti-Discrimination Act, by reference to the grounds set out in section 92(1)(a) of that Act;

(4) The proceedings have been dismissed (or will be dismissed) by the Tribunal upon the basis that it is satisfied that the Applicant does not wish to proceed with the complaint and that the proceedings have been abandoned, pursuant to section 107(1)(a) and (c).

(5) The Respondent has made all reasonable attempts to resolve the matter, but the Applicant has ignored all settlement offers and continued with the proceedings regardless, until the Respondent arranged for the matter to be re-listed before the tribunal for Directions following the Applicant’s failure to comply with the Tribunal’s Direction regarding the timetable for filing and service of his evidence, at which time the Applicant withdrew his application without any prior notice.”

9 Mr. Jenkins’s solicitor has provided submissions in reply. Among other things, he submits as follows:

(1) “To make an award of costs against an applicant in such circumstances might have the effect of breaking his spirit and act as a deterrent to others from making complaints.”

(2) Because the YMCA’s solicitor is also the President of its committee, any costs order “should be extremely limited and conditional upon proof that no offence is committed [pursuant to section 66 of the “Voluntary Associations Act”] and that there is a proper liability.”

10 The Tribunal interprets the latter submission as a reference to section 66 of the Associations Incorporation Act 1984, which prohibits an incorporated association from securing a pecuniary gain for its members. For the reasons which follow, it is unnecessary to consider that submission.

Legislation

11 The Tribunal’s power to make costs orders in inquiries under the Anti-Discrimination Act 1977 is to be found in Section 110 of that Act, which provides:

“(1) Each party to an inquiry is to pay his or her own costs, except as provided by this section.

(2) If the Tribunal is of the opinion in a particular case that there are circumstances that justify it doing so, it may make such order as to costs and security for costs, whether by way of interim order or otherwise, as it thinks fit.”

12 Section 110 has been considered by the Appeals Panel of this Tribunal in Tu v University of Sydney (No. 2) [2002] NSWADTAP 25 and in Sebastian v Rail Infrastructure Corporation [2006] NSWADTAP 44.

13 In Tu’s case, proceedings before the Tribunal for race discrimination were summarily dismissed for want of prosecution. The Appeals Panel found there had been a substantial failure by the Applicant to co-operate with the Tribunal’s directions and respond to them in a timely way, and that this had contributed significantly to the costs of the respondent University. Even so, the Appeals Panel declined to make an order that the Applicant pay the University’s costs in whole. It made orders for costs on a restricted basis, confining them only to the costs of appearances after “the point at which the [Applicant’s] delay became so unreasonable as to warrant intervention by way of a costs order” [at 59].

14 The Appeals Panel observed at [39] – [43]:

“39 Nonetheless the proposition that the s 111(2) discretion [to make a costs order – now, section 110(2)] should ordinarily be exercised in favour of the successful party has not been fully embraced in the equal opportunity jurisdiction. Equal opportunity tribunals have referred to the special character of the jurisdiction, which seeks to protect and promote the observance of fundamental human rights. For example in Anon v Anon (No 1) [1997] NSWEOT (18 July 1997) it was said that the human rights protection objective ‘might be thwarted if complainants were to be discouraged from pursuing claims before the Tribunal due to fear of the amounts that may be awarded against them for inter alia legal costs if unsuccessful on those claims’.

40 However in that case the Tribunal did go on to make a costs order against the complainant. On the complainant’s own application, the complaint was dismissed after five days of hearing. The Tribunal was satisfied that the complaint was misconceived and lacking in substance. It noted that the complainant made a series of admissions under cross examination which cast doubt on the complainant’s bona fides in bringing the complaint; he admitted that he lied under oath.

41 In Fonua v Broken Hill Proprietary Co Ltd & ors [1999] NSWADT 59 the Tribunal found the various complaints of racial discrimination and victimisation in connection with employment misconceived and lacking in substance. They were dismissed pursuant to s 111. The Tribunal went on to examine particular aspects of the behaviour of the complainant, and stated that these circumstances ‘suggested’ that in addition the complaints were frivolous and vexatious. While it made no formal findings to that effect, in these circumstances the Tribunal considered it appropriate to order the complainant to pay the respondent’s costs. For another illustration see Ram Mishra v University of Technology, Sydney, No 23 of 1998, [1998] NSWADT (14 October 1998).

42 The sanction of a full costs order against the complainant tends to be reserved for cases where an abuse of process is seen as having been involved, i.e. those cases where the conduct of the complainant was frivolous, vexatious or lacking in good faith.

43 Where a matter is found to be ‘misconceived’ or ‘lacking in substance’ there is greater caution in making an adverse costs order. A complaint may be ‘misconceived’ or ‘lacking in substance’ for technical legal reasons (e.g. jurisdictional limitations, absence of preconditions as to proof of key facts) which may be lost on the (typically unrepresented) complainant. In these circumstances respondents are often left to bear the cost, because of the greater public interests involved in upholding the making of complaints of violation of human rights: for a recent discussion of these matters see Sivananthan v Commissioner of Police [2002] NSWADT 45 at [16-28].” (emphasis added)

15 In Sebastian’s case, three complaints of disability discrimination had been referred to the Tribunal. In proceedings before its Equal Opportunity Division, the Applicant had entered into a settlement agreement, which he later sought to avoid. At the request of the Respondents, the Tribunal dismissed the proceedings, on the basis that they had been compromised by the settlement agreement. Mr. Sebastian sought leave to appeal to the Appeals Panel. The Appeals Panel found that Mr. Sebastian’s appeal enjoyed no prospect of success, and declined to grant leave. Nevertheless, it declined to grant a costs order against him. The Appeals Panel observed at [42] – [43]:

“In summary, the principles relevant in relation to an application of costs in the proceedings are as follows:

(1) Section 110 creates a presumption that each party will pay his or her own costs and a discretion to award costs: Cleary Bros (Bombo) Pty Ltd -v- Cvetkovski(EOD) [2001] NSWADTAP 10 at paragraphs 63-65;

(2) This discretion must be exercised judicially, and no authority or rule can determine whether in any particular case an order should be made;

(3) previous cases relating to costs can only provide an indication of the kinds of circumstances that may attract a costs order;

(4) as a general proposition, a combination of circumstances is required in order to justify an award of costs. See, for example, Russell v The Commissioner of Police, NSW Police Service and Others [2002] (No.2) NSWADT 252; Peck v Commissioner of Corrective Services(No. 2) [2002] NSWADT 244; V v Y & Anor; X v Y & Anor [2002] NSWADT 7; Duggan v Shore Inn Pty Limited (1993) EOC 92-483; Willis v State Rail Authority of New South Wales(No. 3) (1992) EOC 92-456; Holdaway v Qantas Airways Limited (1992) EOC 92-430; Squires v Qantas Airways Ltd (1985) EOC 92-135. In combination with other factors, the kinds of circumstances which have been regarded in previous cases as justifying an award of costs against an applicant include:

(i) the manner in which the applicant has conducted the proceedings, in particular whether the proceedings were vexatious;

(ii) whether the proceedings determine or clarify an important question of law;

(iii) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding; and

(iv) where an appeal is lodged and the Appeal Panel considers the appeal was without any real prospect of success.

43 The only relevant factor in this case is that the appeal was conducted without any real prospect of success. There was no suggestion that the appeal was vexatious or that Mr Sebastian’s conduct unreasonably prolonged the time taken to complete the proceedings. Mr Sebastian was not legally represented. Consequently his knowledge of the prospects of success of the appeal would have been negligible. In our view, the circumstances in which this appeal was brought and prosecuted do not justify an award of costs against Mr Sebastian. The ability or otherwise of a person to meet an order for costs is not a relevant consideration when determining whether costs should be awarded.”

16 These principles were recently applied by the Tribunal in its Equal Opportunity Division in Murtough v NSW Bar Association [2008] NSWADT 166. Deputy President Britton observed at [27]:

“The issue to be determined is whether the circumstances of this case warrant a departure from the presumption enshrined in section 110 of the Act that in this jurisdiction each party will bear its own costs. That presumption ought not to be disturbed without good cause. A determination of the question whether costs should be awarded requires a balance to be struck between the “chilling effect” of too readily ordering costs against complainants (see Maylor (No.2) v Mid North Coast Area Health Service [2001] NSWADT 118 at [23]) and the need to ensure that parties conduct their cases in such a way that costs are not unnecessarily incurred or forced on others. The real questions to be determined are whether, due to a combination of factors, circumstances have arisen that displace the general presumption against an order for costs and, if so, whether the order ought be an order for costs of the entire proceedings or an order for the costs in relation to part of the proceedings.”

17 In that case, proceedings were dismissed for want of prosecution, on the Applicant’s failure to appear at hearing. The Tribunal found that the Applicant had failed to appear when required, and had repeatedly failed to comply with its directions, causing a waste of time and money. Nevertheless, it declined to order that he pay the Respondent’s entire costs of the proceedings, but rather confined its orders for costs to those thrown away by particular failures to comply with certain directions.

Submissions on costs

18 Before applying the provisions of section 110 in these proceedings, it is appropriate to consider in detail the submissions made in favour of granting the costs order.

19 First, the YMCA submits that the claim was lacking in substance, or misconceived. It indicated to the Anti-Discrimination Board that the alleged insult – if uttered - was not authorised by the employer, that Mr. Jenkins failed to bring the insult to the attention of the YMCA, that its manager at the Aquatic Centre attempted to mediate between Mr. Jenkins and the other employee, that the employer otherwise showed great compassion to Mr. Jenkins, and that the employer had done all it reasonably could to prevent discrimination on the grounds of race, by establishing a code of conduct in relation to it, and giving notice of that code to Mr. Jenkins.

20 This gives rise to significant issues of fact between the parties.

21 As the hearing will not now proceed, the Tribunal is not in a position to adjudicate these assertions, or to find whether in all the circumstances the facts amount to actionable discrimination, or provide a viable defence. In those circumstances, it cannot find that the claim was either lacking in substance or misconceived, as the YMCA submits. Even if the Tribunal were to find that the claim lacked substance or was misconceived, that alone would be unlikely to justify the making of a costs order, for the reasons given in Tu’s case, at [43] supra.

22 Secondly, the YMCA submits that the Tribunal may dismiss the proceedings under section 92(1)(a) of the Anti-Discrimination Act 1977. On the contrary, that power may be exercised only by the President of the Anti-Discrimination Board, and only in relation to complaints before the Board.

23 Thirdly, the YMCA submits that the Tribunal will dismiss the proceedings pursuant to paragraphs (a) or (c) of Section 107(1) of the Act, because Mr. Jenkins has indicated an intention to withdraw, and has abandoned the proceedings respectively.

24 An order under paragraph (c) would not be appropriate, as the proceedings have not been abandoned. A case of abandonment was recently considered by the Tribunal in Dunn v New Group Training Inc [2008] NSWADT 287. In that case, the Applicant’s solicitors had ceased to act. The Applicant himself had ceased to answer correspondence, and could not be contacted by phone. The proceedings were dismissed for want of prosecution.

25 In these proceedings, Mr. Jenkins has continued to be represented. By his solicitor, he has continued to participate in case conferences, and has made written submissions on the application for costs. Unlike the situation in Dunn’s case, the proceedings are to be discontinued on notice. The appropriate order is one under paragraph (a). As this is not a jurisdiction in which costs automatically follow the event, the fact that the Tribunal dismisses proceedings pursuant to paragraph (a) would not, of itself, justify a costs order against an Applicant.

26 Fourthly, the YMCA submits that Mr. Jenkins ignored its reasonable offers of settlement. There is only one offer before the Tribunal in respect of these proceedings. It is contained in a Calderbank letter dated 27 February 2008 from the YMCA’s solicitor to the Plaintiff’s solicitor. In that letter, the YMCA invited Mr. Jenkins to discontinue the proceedings with no order as to costs.

27 A more generous offer of $1,500, inclusive of costs, had been made on 13 August 2007, in respect of the complaint before the Anti-Discrimination Board. There is no evidence before the Tribunal that it was repeated in the context of these proceedings.

28 In jurisdictions in which costs follow the event, offers expressed pursuant to Calderbank letters and similar instruments can be of pivotal importance in determining both whether an order for costs ought be made, and on what basis. This is not a jurisdiction in which costs generally follow the event. A Calderbank letter may be taken into account, but the discretion provided by section 110 is broadly based, and the Tribunal must exercise it having regard to all the circumstances before it.

29 The offer made on 27 February 2008 was, in effect, an invitation to capitulate, rather than a true offer of compromise. Costs aside, it sought to obtain for the YMCA the best result it could possibly have obtained, had it succeeded at the hearing. Given the presumption against costs orders enshrined in section 110(1), the element of compromise on costs was so slight as to be of little significance. Generally speaking, invitations to capitulate do not entitle the party making them to a more generous costs order than they would otherwise receive, even in jurisdictions where costs follow the event: Tickell v Trifleska Pty Limited (1990) 25 NSWLR 353; Hobartville Stud Pty Limited v Union Insurance Co Limited (1991) 25 NSWLR 358.

30 Even if the offer of 27 February 2008 is construed as offering a true compromise – as did the previous offer of 13 August 2007 in respect of the complaint - the mere fact that either or both was declined does not, in the absence of the combination of factors referred to in Tu and Sebastian, incline the Tribunal to make the order sought.

31 Fifthly, the YMCA relies on Mr. Jenkins’ failure to comply with the Tribunal’s timetable for the filing and service of his evidence. On 11 June 2008, the Tribunal directed Mr. Jenkins to file and serve within 35 days his Points of Claim, a witness statement and any documents on which he sought to rely. A date for hearing was later fixed.

32 Mr. Jenkins did not comply with the timetable. At a case conference on 13 August 2008, his solicitor explained that delay had been caused by difficulties in accessing documents produced to the Registry. The hearing dates were vacated, and a further timetable set.

33 Whatever factors may have contributed to the delay, the appropriate course was to have the matter listed for directions at the earliest opportunity, so that the delay and the reasons for it might be aired before the Tribunal, and an amended timetable set. Nevertheless, the default complained of was not so severe, repeated or contumelious as to persuade the Tribunal to make an order for costs against Mr. Jenkins.

34 Finally, the YMCA submits that Mr. Jenkins “withdrew his claim without any notice”. By letter dated 24 February 2008, Mr. Jenkins’ solicitor informed the solicitor for the YMCA as follows:

“… if this matter is not finally settled at the mediation set down for 26 February 2008, in addition to the present proceedings, my client will institute proceedings in the Federal Court … without further delay.”

35 The parties were represented at a case conference on 9 April 2008. According to the solicitor for the YMCA, Mr. Jenkins’ solicitor said words to this effect: “There may well be Federal Court proceedings as well, where a greater amount of damages is available”. According to the Tribunal’s file, the presiding judicial member observed that the leave of the Tribunal would be needed if Mr. Jenkins wished to maintain these proceedings concurrently with other proceedings.

36 At a further case conference on 13 August 2008, Mr. Jenkins’ solicitor announced his client’s intention to withdraw the proceedings, and to proceed in the federal jurisdiction. After further consideration, he indicated that he would take instructions from his client. The Tribunal directed Mr. Jenkins to notify the Registry within 7 days whether he intended to withdraw the proceedings.

37 On 20 August, Mr. Jenkins notified the Registry by letter of his intention to withdraw. The solicitor for the YMCA accepts that a copy was received by him on that date.

38 The Tribunal finds that Mr. Jenkins first foreshadowed the commencement of proceedings in another jurisdiction on 24 February 2008. On 9 April 2008, he raised the prospect again. On that occasion, the parties were informed that concurrent proceedings could not be maintained without leave of the Tribunal. This raised the prospect that the proceedings before the Tribunal might be withdrawn or dismissed, if leave to maintain them concurrently with other proceedings was not granted. Mr. Jenkins raised the matter again at the case conference on 13 August, and confirmed his intention to withdraw on or about 20 August 2008.

39 In the circumstances, it would not be correct to say that the decision not to proceed was made without forewarning.

Exercise of discretion

40 This is not a case in which the proceedings can properly be described as frivolous, vexatious, or lacking in good faith. No abuse of process has been demonstrated. The Tribunal is not in a position to find that the claim is lacking in substance or misconceived. The defaults in compliance with timetable, such as they are, do not compare with the defaults in Tu or Murtough. The combination of circumstances required to justify a costs order is lacking: Borg v Commissioner, Department of Corrective Services [2003] NSWADT 35; Sebastian v Rail Infrastructure Corporation [2006] NSWADTAT 44; Murtough v NSW Bar Association [2008] NSWADT 166.

41 The jurisdiction of this Tribunal in its Equal Opportunity Division is of a “special character … which seeks to protect and promote the observance of fundamental human rights”: Tu at [39]. In determining whether to exercise its discretion under section 110, the Tribunal has regard, on the one hand, to “the need to ensure that parties conduct their cases in such a way that costs are not unnecessarily incurred or forced on others”, and on the other, to the need to avoid “the ‘chilling effect’ of too readily ordering costs against complainants”: Murtough v NSW Bar Association [2008] NSWADT 166. In the circumstances of this case, the facts weigh more heavily in favour of the latter consideration. This is not a case in which the Tribunal is inclined to exercise its discretion to make an order requiring the Applicant to pay the Respondent’s costs.

42 It is unnecessary to consider the issues raised in Mr. Jenkins’ submissions.

43 On 13 August 2008, the YMCA notified the Tribunal that it would apply for dismissal for want of prosecution. That application was overtaken by the notice of intended withdrawal. In its submissions, the YMCA has acknowledged that the proceedings may be dismissed pursuant to section 107(1)(a) of the Anti-Discrimination Act 1977, and has raised no objection to that course. In those circumstances, it is unnecessary to determine any application for dismissal.

Orders

1. The proceedings are dismissed pursuant to section 107(1)(a) of the Anti-Discrimination Act 1977

2. Each party shall bear its own costs.