Julie Palm v Sydney Night Patrol & Inquiry Co Pty Ltd t/a SNP Security
[2016] FWCFB 8664
•12 DECEMBER 2016
| [2016] FWCFB 8664 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
v
Sydney Night Patrol & Inquiry Co Pty Ltd t/a SNP Security
(C2016/4510)
VICE PRESIDENT HATCHER | SYDNEY, 12 DECEMBER 2016 |
Appeal against decision [2016] FWC 4292 of Deputy President Kovacic at Melbourne on 30 June 2016 in matter number U2015/13854 - Costs application.
[1] On 27 October 2015 Ms Julie Palm made an application for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (FW Act) in respect of the termination of her employment with Sydney Night Patrol & Inquiry Co Pty Ltd t/a SNP Security (SNP). In a decision issued on 30 June 2016 1 Deputy President Kovacic dismissed the application on the basis that the reason relied upon by SNP to dismiss Ms Palm was valid, and that this outweighed matters in her favour such as her length of service and her employment record.2 Ms Palm then applied for permission to appeal and appealed the Deputy President’s decision. Her application for permission to appeal was heard by this Full Bench on 10 August 2016. In a decision issued on 2 September 20163 (Decision), we determined to refuse permission to appeal.
[2] SNP has now made an application for Ms Palm to pay its costs of the permission to appeal hearing. The application is made pursuant to s.611(2) of the FW Act. Section 611(1) establishes a general rule that parties in proceedings before the Commission must bear their own costs. Section 611(2) operates as an exception to this general rule and provides:
(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.
[3] 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 4and 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, or manifestly groundless, or discloses a case which the tribunal is satisfied cannot succeed.
[4] In relation to s.611(2)(b), the relevant principles were summarised by the Full Bench in Baker v Salva Resources Pty Ltd 5as follows (footnotes omitted):
- ‘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.”
“[10] The concepts within s.611(2)(b) ‘should have been reasonably apparent’ and ‘had no reasonable prospect of success’ have been well traversed:
[5] SNP relied on both limbs of s.611(2), submitting that Ms Palm had no reasonable prospect of success and that her appeal was so lacking in merit as to not be reasonably arguable. It contended that Ms Palm:
- failed to identify any arguable “significant errors of fact” in the decision of the Deputy President;
- failed to identify any arguable grounds to attract the public interest;
- sought to raise matters and arguments already dealt with in the decision; and
- raised matters not relevant in the determination of an appeal.
[6] SNP also placed reliance on an email it sent to Ms Palm’s solicitor on 1 August 2016, in which had put Ms Palm on notice of a possible costs application in advance of the appeal hearing and invited Ms Palm to discontinue the Appeal. SNP identified its costs of the appeal as being $1131.50.
[7] Ms Palm submitted in reply to SNP’s submissions that:
- SNP had no evidence that Ms Palm did not think her appeal had no reasonable prospect of success and that she was not vexatious or without reasonable cause;
- the Decision of the Deputy President did have errors of law and fact;
- the Deputy President’s conclusion that Ms Palm’s conduct constituted serious misconduct because it amounted to theft led to his finding that there was a valid reason for dismissal, and this was not held up on appeal;
- there was no evidence that Ms Palm had an ulterior motive to harass or embarrass SNP;
- a party cannot be said to have commenced a proceeding without reasonable cause simply because it was unsuccessful at first instance; and
- there were facts at the time for filing for unfair dismissal remedy which supported Ms Palm’s appeal.
[8] In assessing SNP’s costs application, it is important to observe that the costs that are sought are those of the application for permission to appeal only (the appeal having never proceeded to a substantive hearing). The criteria in s.611(2) are therefore to be considered in that context.
[9] It is clear that SNP is not entitled to costs merely because Ms Palm was unsuccessful in obtaining permission to appeal. We do not consider that the application for permission to appeal was manifestly untenable or not reasonably arguable. We consider that in support of her application for permission to appeal Ms Palm advanced arguments which were not unworthy of consideration. For example in the following passage in the Decision, we gave serious consideration to Ms Palm’s argument that her conduct did not constitute theft (as it was characterised by the Deputy President), but ultimately determined that this could not lead to a different outcome: (footnote omitted)
“[17] We accept that it is at least arguable that Ms Palm’s action in taking an item that was shortly destined for destruction, and the ownership of which after seizure was debatable, might not strictly constitute an act of theft. However it does not follow therefore, that there is an arguable case that the Deputy President erred in concluding that there was a valid reason for dismissal. It was clear on the evidence that an important feature of SNP’s contractual obligations to CAG was to ensure its employees acted in accordance with CAG’s security policies and procedures involving surrendered items, something which Ms Palm did not do. Her wilful failure in this respect was a serious matter and provided a proper basis for her dismissal. We are also of the view that there was no error on the part of the Deputy President when he found that Ms Palm had not behaved honestly and with integrity and that a valid reason existed for her dismissal on that basis, having regard to the quoted passage from Concut.”
[10] This makes evident that aspects of Ms Palm’s case for the grant of permission to appeal were reasonably arguable.
[11] There is no basis to conclude that Ms Palm instituted the appeal proceedings in order to harass or embarrass SNP or to gain a collateral advantage. The permission to appeal application was seriously pursued, as demonstrated by the fact that Ms Palm was represented by a legal practitioner, and properly considered submissions were advanced on her behalf.
[12] For these reasons we do not consider that either of the jurisdictional prerequisites for the grant of a costs order in s.611(2) are satisfied. The power to award costs is therefore not enlivened, and SNP’s costs application must be dismissed.
VICE PRESIDENT
Final written submissions:
Sydney Night Patrol and Inquiry Co. Pty Ltd t/a SNP Security – 27 September 2016
Julie Palm – 27 September 2016
1 [2016] FWC 4292
2 Paragraph [48]
3 [2016] FWCFB 5504
4 [2014] FWCFB 810 at [23]-[33], 240 IR 377
5 [2011] FWAFB 4014, 211 IR 374
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