Liquor, Hospitality & Miscellaneous Union v The Roman Catholic Archbishop of Perth
[2008] FCA 457
•9 April 2008
FEDERAL COURT OF AUSTRALIA
Liquor, Hospitality & Miscellaneous Union v The Roman Catholic Archbishop
of Perth [2008] FCA 457COSTS – motion for interim injunctions withdrawn – s 824 Workplace Relations Act 1976 (Cth) – whether costs ought be ordered to be paid by first respondent – whether motion instituted by first applicant without reasonable cause – whether pursuit of motion involved unreasonable acts or omissions by the first applicant which occasioned the respondent to incur costs – costs ordered.
COSTS – indemnity costs – application by respondent for indemnity costs – whether it was unreasonable for the first applicant to have subjected the respondent to the expenditure of costs – costs ordered on indemnity basis.
Workplace Relations Act 1996 (Cth), ss 400(1), 414, 792, 807, 824
Hamod v New South Wales (2002) 188 ALR 659
Paras v Public Service Body Head of the Department of Infrastructure (No 3) (2006) 152 FCR 534LIQUOR HOSPITAL & MISCELLANEOUS UNION v THE ROMAN CATHOLIC ARCHBISHOP OF PERTH CORPORATION SOLE TRADING AS i.d.entity.wa
WAD 27 OF 2008
GILMOUR J
9 APRIL 2008
PERTH
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WAD 27 OF 2008
BETWEEN:
LIQUOR HOSPITALITY AND MISCELLANEOUS UNION First Applicant
LUBICA (LOU) MCGUIRE
Second Applicant
AND:
THE ROMAN CATHOLIC ARCHBISHOP OF PERTH CORPORATION SOLE TRADING AS i.d.entity.wa
Respondent
JUDGE:
GILMOUR J
DATE OF ORDER:
9 APRIL 2008
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.The motion be dismissed.
2.The first applicant pay the costs of the respondent in relation to the notice of motion including the costs of hearings on the 6 February 2008 and 19 March 2008 on an indemnity basis.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WAD 27 OF 2008
BETWEEN:
LIQUOR HOSPITALITY AND MISCELLANEOUS UNION
First ApplicantLUBICA (LOU) MCGUIRE
Second Applicant
AND:
THE ROMAN CATHOLIC ARCHBISHOP OF PERTH CORPORATION SOLE TRADING AS i.d.entity.wa
Respondent
JUDGE:
GILMOUR J
DATE:
9 APRIL 2008
PLACE:
PERTH
REASONS FOR JUDGMENT
By urgent notice of motion on 5 February 2008, the applicants sought the following interim interlocutory injunctive relief under the:
(a)Workplace Relations Act 1996 (Cth) (“WR Act”) s 400(1) and s 414, restraining the respondent from taking action or refraining to take action by:
(i)ceasing or threatening to cease providing payroll deductions for the purpose of union membership fees (‘the Payroll Deductions’) to the second applicant and all group members; and/or
(ii)ceasing or threatening to cease forwarding the money deducted from the pay of the second applicant and group members as part of the payroll deductions to the first applicant
with the intent to coerce the first and second applicant or group members to agree, make or approve a collective agreement made under the WRA.
(b)WR Act ss 400(1), 414 and the courts accrued jurisdiction, requiring the respondent to:
(i)immediately withdraw the internal memo sent to the second applicant on 30 January 2008;
(ii)immediately resume the Payroll Deductions for the second applicant;
(iii)immediately forward the money deducted from the pay of the second applicant, as part of the Payroll Deduction, to the first applicant
(iv)to take steps to immediately inform the second applicant of the withdrawal of the internal memo and the recommencement of the payroll deductions.
(c) WR Act ss 792 and 807, restraining the respondent from:
(i) injuring the second applicant in their employment;
(ii)altering the position of the second applicant in their employment with the respondent;
by
(a)ceasing to provide the Payroll Deductions to the second applicant: and/or
(b)ceasing to forward the money deducted from the pay of the second applicant as part of the payroll deductions to LHMU.
BACKGROUND
The first applicant is the Liquor, Hospitality and Miscellaneous Union (“LHMU”). It is an organisation registered under the WR Act. The second applicant, Lubica (Lou) McGuire, is a representative party. The group to which the second applicant belongs and which she represents comprises those who:
(a) are employees of the respondent;
(b) are members of the first applicant;
(c)were provided a payroll deduction facility by the respondent for the purposes of paying a membership fee to the LHMU as of 29 January 2008; and
(d)received a notice from the LHMU on 30 January 2008, that the respondent would no longer provide the payroll deduction facilities mention in (c).
I will refer to them collectively as the “group members”.
The respondent is the Roman Catholic Archbishop of Perth Corporation Sole Trading As i.d.entity.wa and is the employer of the group members.
The employment of the group members by the respondent has since 27 March 2006 been subject to a Preserved State Agreement by the operation of Schedule 8, Part 2, Div 2, clause 10 of the Schedules to the WR Act.
In July 2007 the parties commenced negotiations for a new agreement. On 6 December 2007 the LHMU issued a notice to initiate a bargaining period pursuant to the WR Act. Following a protected action ballot, on 25 January 2008 the first respondent was advised by the LHMU that protected industrial action had been authorised by the ballot. The proposed industrial action affected the group members. The protected industrial action against the respondent was due to commence on 1 February 2008.
The respondent had formerly paid the union membership dues of the group members on a monthly basis by deducting the amount of those dues from the wages of the group members and then forwarding it to the LHMU (“the payroll deduction scheme”). The last such payment made by the respondent to the LHMU was on 4 January 2008 for membership dues accruing in the month of December. However the union membership dues for the month of January 2008 payable to the LHMU on 1 January 2008 were not paid by the respondent although it had deducted the amount of those dues from each of the group members’ wages. The amounts deducted varied from approximately $20 to $40 for each group member.
On 30 January 2008, a memo dated 29 January 2008 was sent by the Executive General Manager – Operations of the respondent to the group members stating that it would no longer continue to deduct LHMU union dues from their wages. It states as follows:
I advise with effect from this pay i.d.entity.wa will no longer continue to deduct LHMU union subscriptions from your fortnightly pay. You will need to make arrangements with the LHMU re future payments.
The Union deductions for the two pay periods in January 2008 will be reimbursed in your first pay in February as these payments have not been processed through to the Union. This process normally occurs at the end of each month.
The applicants complain that this decision was made without prior warning, consultation or notice to either of the applicants or any of the other group members. Ms Kelly Shay is an assistant secretary of the LHMU. In an affidavit sworn by her on 1 February 2008 she deposes to her belief that the decision by the respondent not to continue to deduct union dues from the wages of the group members and forward these to the LHMU was an attempt to coerce the group members. I take this to mean an attempt to coerce the group members toward reaching an agreement with the respondent in relation to the terms of a new agreement. She also asserts her belief that the respondent’s action was in breach of the conditions of employment of the group members, thereby injuring each of them in their employment. Finally, she deposes that the respondent’s decision was made in order to frustrate the lawful process of industrial action, discriminate against the LHMU’s members, victimise and bully LHMU and the group members for the direct purpose of intimidating and coercing the applicants into agreeing to the terms of an agreement against the will of the group members.
Mr Michael Aulfrey is employed as a solicitor for the LHMU. He also acted as solicitor in these proceedings for the second applicant. In Mr Aulfrey’s affidavit of urgency sworn 1 February 2008, he deposed that if the members were unable to pay their union dues or if they were not paid on time, the members may become unfinancial, with the consequences that their status, in the union, may be altered and that would affect the second applicant’s ability to participate in protected industrial action. The affidavit was sworn on behalf of both applicants. This was the asserted basis of the urgent application. Whilst to an extent the applicants have different interests, their interests in this application were presented jointly.
At the hearing on 6 February 2008, counsel for the applicants informed me that the group members would, in the future, be paying their union dues by direct bank debit. In those circumstances the applicants no longer sought injunctive orders for the reinstitution of the payroll deduction scheme. Indeed the only relief pressed was for orders that the respondent immediately forward the dues for January 2008 deducted from the pay of the group members, as part of the payroll deduction, to the LHMU. At that time no request for the dues to be forwarded to the LHMU or that the deducted monies be paid to the individual group members had been made to the respondent by either of the applicants. I adjourned the hearing to enable the applicants to consider whether such requests ought be made.
In due course, the respondent was requested by the LHMU to pay the deducted union dues to the individual group members. It has done so. This is merely consistent with what, in its memo dated 29 January 2008, it said it was going to do. Each group member has, as was foreshadowed at the hearing on 6 February, also made arrangements for their union dues to be paid to the LHMU by direct debit from their respective bank accounts. That rather obvious solution, in effect, had earlier been pointed out to each of the group members in the memo of 29 January 2008. In those circumstances, the applicants do not propose to continue with their motion. It should accordingly be dismissed.
The respondent seeks orders that the first applicant pay its costs in connection with the notice of motion on an indemnity basis. It does not seek a costs order against the second applicant.
REASONS
The LHMU submitted that by virtue of the provisions of s 824 of the WR Act no costs ought to be ordered. Section 824 relevantly provides that:
Costs only where proceeding instituted vexatiously etc.
(1)A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) must not be ordered to pay costs incurred by any other party to the proceeding unless the first mentioned party instituted the proceeding vexatiously or without reasonable cause.
(2)Despite subsection (1), if a court hearing a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) is satisfied that a party to the proceeding has, by an unreasonable act or omission, caused another party to the proceeding to incur costs in connection with the proceeding, the court may order the first mentioned party to pay some or all of those costs.
In my opinion, the application for costs, in the present circumstances, may be grounded under either s 824(1) or s 824(2): Paras v Public Service Body Head of the Department of Infrastructure (No 3) (2006) 152 FCR 534 at [16] and [19]. Accordingly, costs may be ordered if the motion for injunctive relief was instituted vexatiously or without reasonable cause, or that the pursuit of that motion by the LHMU involved unreasonable acts or omissions which caused the respondent to incur costs.
The respondent submits that under either limb the LHMU had acted unreasonably and costs should be awarded as the urgent application for an interlocutory injunction never had any prospect of success. It submits, additionally, and for the same reason, that such costs ought to be awarded on an indemnity basis.
It contends first, that had the first applicant or any of the group members acted reasonably, they could have asked for the dues which had been deducted to be immediately forwarded to the LHMU or paid to each member of the group and, second, the group members could have arranged to make future payments directly to the union personally.
The respondent further submits that there was never any threat immediate or otherwise that any member of the group would become unfinancial. The rules of the LHMU state relevantly that:
16. Unfinancial Membership
(a) A member of the union shall be unfinancial if:
(i) …
(ii)the member, being a member who’s membership dues are collected under a system or arrangement described in Rule 8(b)
(A)has been a member for 6 months or more and the relevant union office has not received in respect of that member in the immediately preceding 6 months an amount in dues equal to two months dues on a pro rata basis…
(B)Where a member has been a member for a period of less than 6 months, and the relevant union office has not received in respect of that member in the immediately preceding months an amount in dues equivalent to one month’s dues…
…
(g)Where the National Executive or a Branch Executive is satisfied that a member is unfinancial through no fault of the member, for example because the member’s employer has not forwarded to the union monies collected from the member on account of union dues, it may waive the outstanding amount owing (whether the amount owing is comprised of outstanding contributions, or an unpaid fine or levy) and declare the member financial and such member shall thereupon be treated as being a financial member.
The first applicant contends that the litigation has to be viewed in the following context. There was protected industrial action due to commence on 1 February 2008. The memo dated 29 January 2008 stating that the respondent would no longer deduct union dues and forward them to the LHMU, which was made without warning or consultation with LHMU was issued to the group members on 30 January 2008. In Ms Shay’s affidavit she deposed that she had asked for an explanation from the respondent, however no reason was afforded to her. In light of the relevant circumstances, the applicant submits that it would have been a nugatory exercise, at the time, to request that the dues be paid.
The LHMU submits that the action did have a prospect of success in circumstances where a group member’s payroll deductions for union dues had ceased and that member chose not to make any payments and simply awaited the resolution of these proceedings. Had that occurred, then such a member could have become unfinancial.
I do not accept that submission. Even in the contextual surroundings described by the applicant, it was unreasonable in the first instance that no request was made by either of the applicants for the deducted union dues to be forwarded either to the LHMU or paid forthwith to the individual group members before instituting the motion. Indeed the memo from the respondent clearly indicated that the dues already deducted would be reimbursed to the individual employees in their first pay in February 2008. That fact, of itself, is sufficient in my opinion to render the conduct of the applicants unreasonable.
In my opinion the urgent interlocutory application had no realistic prospect of success as no group member was in any immediate threat of becoming unfinancial, given the membership rules of the LHMU. There was no evidence before me that any of the group members had been members of the LHMU for less than six months. The affidavits of the second applicant and four other group members in each case disclosed that they had been members for more than six months. There was no evidence, one way or the other, about the remaining twenty-two group members. It was not suggested, nor is there evidence that in the six months immediately preceding the motion that the LHMU had not received “dues” from any of the group members equal to two months dues on a pro rata basis (rule 16(a)(ii)(A)). In fact the evidence was that monthly payments of dues had been made to the LHMU by the respondent except for the month of January 2008. There was therefore no immediate danger that any group member would become unfinancial. Even if a member were to have been liable to become unfinancial because the respondent had not forwarded union dues to the LHMU then, by virtue of rule 16(g) it was within the power of the LHMU to waive the outstanding amount and to declare the member financial, thereby avoiding the purported difficulty.
Accordingly, I am satisfied that the proceedings were instituted without reasonable cause or alternatively that in bringing the motion the LHMU involved unreasonable acts or omissions which caused the respondent to incur costs. The first applicant should pay the costs of the respondent in relation to the notice of motion filed on 5 February 2008 as well as the costs of hearings heard on the 6 February 2008 and 19 March 2008.
I accept the submission of the respondent that payment of its costs should be made on an indemnity basis in relation to the motion including costs associated with the hearings on 6 February 2008 and 19 March 2008. The observations of Gray J (with whom the other members of the Court agreed) in Hamod v New South Wales (2002) 188 ALR 659 at [20] are apposite.
Indemnity costs are not designed to punish a party for persisting with a case that turns out to fail. They are not awarded as a means of deterring litigants from putting forward arguments that might be attended by uncertainty. Rather, they serve the purpose of compensating a party fully for costs incurred, as a normal costs order could not be expected to do, when the court takes the view that it was unreasonable for the party against whom the order is made to have subjected the innocent party to the expenditure of costs.
This is the situation here, as I have already found, upon the question whether costs ought be ordered at all. It was unreasonable for the first applicant to bring the motion, and thereby subject the respondent to the expenditure of costs.
I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gilmour. Associate:
Dated: 9 April 2008
Counsel for the First and Second Applicants: Mr M J Aulfrey Solicitor for the First and Second Applicants: Liquor, Hospitality and Miscellaneous Union Counsel for the First Respondent: Mr J B Blackburn Solicitor for the First Respondent: CCI Legal
Date of Hearing: 19 March 2008 Date of Judgment: 9 April 2008
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