Loukis v Compaction Soil Testing Services Pty Ltd (No 2)

Case [2021] FedCFamC2G 185

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Loukis v Compaction Soil Testing Services Pty Ltd (No 2) [2021] FedCFamC2G 185

File number(s): SYG 505 of 2020
Judgment of: JUDGE DRIVER
Date of judgment: 5 November 2021
Catchwords: INDUSTRIAL LAW – COSTS – claim for costs under general legislative provision and Court Rules and under the Fair Work Act 2009 (Cth) – whether the principal proceeding was commenced unreasonably or whether the applicant made an unreasonable act or omission considered – claim for costs dismissed.
Legislation:

Fair Work Act 2009 (Cth) s 570

Federal Circuit Court of Australia Act 1999 (Cth) (repealed) s 79

Federal Circuit Court Rules 2001 (Cth) (repealed)

Cases cited:

Australian Workers Union v Leighton Contractors Pty Ltd (No 2) [2013] FCAFC 23

Celand v Skycity Adelaide Pty Ltd [2017] FCAFC 222

Fair Work Ombudsman v Valuair Ltd (No 3) [2014] FCA 1182

Health Services Union v Jackson (No 5) [2015] FCA 1467

Loukis v Compaction & Soil Testing Services Pty Ltd [2021] FCCA 281

McDonald v Parnell Laboratories (Aust) (No 2) (2007) 164 FCR 591

Murphy v Innovior Pty Ltd (No 2) [2021] FCCA 258

R v Moore; Ex parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470

Ryan v Primesafe [2015] FCA 8

Saxena v PPF Asset Management Ltd [2011] FCA 395

Shea v EnergyAustralia Services Pty Ltd (No 2) [2015] FCAFC 14

Trustee for The MTGI Trust v Johnston (No 2) [2016] FCAFC 190
Division: Division 2 General Federal Law
Number of paragraphs: 31
Date of hearing: 25 October 2021
Place: Sydney
Counsel for the Applicant: Ms U Okereke-Fisher
Solicitor for the Applicant: The Australian Workers’ Union
Solicitor for the Respondent: Kennedys (Australasia)
Counsel for the Respondent: Ms J Steele SC

ORDERS

SYG 505 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

STEPHANIE LOUKIS

Applicant
AND:

COMPACTION & SOIL TESTING SERVICES PTY LTD

Respondent

ORDER MADE BY:

JUDGE DRIVER

DATE OF ORDER:

5 NOVEMBER 2021

THE COURT ORDERS THAT:

1.The Application in a Case filed on 11 August 2021 is dismissed.

Note: The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT

JUDGE DRIVER:
INTRODUCTION AND BACKGROUND

  1. On 8 July 2021 I gave judgment in the principal proceedings in this matter.  I ordered that the principal application be dismissed.[1] The respondent company, Compaction & Soil Testing Services Pty Ltd (the company), foreshadowed an application for costs. The company filed an Application in a Case on 11 August 2021 seeking orders for costs under s 79 of the Federal Circuit Court of Australia Act 1999 (Cth)…

Continue reading Loukis v Compaction Soil Testing Services Pty Ltd (No 2)

Sign in free to access the full text

Details
AGLC
Loukis v Compaction Soil Testing Services Pty Ltd (No 2) [2021] FedCFamC2G 185
Case
[2021] FedCFamC2G 185
Decision Date

CaseChat Overview and Summary

The case of Loukis v Compaction Soil Testing Services Pty Ltd (No 2) concerns a dispute over the costs incurred in litigation that arose from an employment termination. The matter was before the Federal Circuit and Family Court of Australia, where the applicant, Ms Loukis, sought costs under both the general legislative provision and the Court Rules, as well as under the Fair Work Act 2009 (Cth). The primary issue before the court was whether the principal proceeding was commenced unreasonably or whether Ms Loukis made an unreasonable act or omission. The court also considered whether the proceedings were vexatious or without reasonable cause.

The court examined the nature of the proceedings, which had been contentious and rigorous, with numerous allegations and counter-allegations from both parties. Despite the adversarial conduct, the court identified that the central issue in the case was the interpretation of the termination letter. The court acknowledged that the proceedings were hard fought but concluded that they were not unreasonable or vexatious. The court found that the proceedings were reasonably and properly instituted, and the conduct of the proceedings did not amount to an unreasonable act or omission. The court held that the costs of the proceedings should lie where they fell, and dismissed the application for costs.

The court's reasoning was grounded in the principle that the relevant question is whether the proceeding had reasonable prospects of success at the time it was instituted, not whether it ultimately failed. The court did not find any evidence that the proceedings were commenced without reasonable cause or that they were vexatious. The court found that the decision to institute the proceedings was based on the ambiguity of the termination letter and the arguable interpretation of the dismissal reason. The court also considered the interaction between the parties before the Fair Work Commission and the subsequent failure of conciliation, which led to the proceedings in the Court.

The court's final order was to dismiss the application for costs with no order as to costs. The court held that the proceedings were reasonably instituted, and the conduct of the proceedings did not warrant an award of costs against Ms Loukis. The court's decision was based on the principle that the merits of the case at the time of institution, rather than its ultimate outcome, determined whether the proceedings were reasonable.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

As matters turned out, the hearing of this case was characterised by its hard fought nature of the case. Numerous allegations were made against both parties and witnesses were examined at length to explore asserted failings on their part. As I pointed out in my judgment, however, despite all of the allegations from both sides, the case was a simple one concerning the meaning of the termination letter which reflected the real reason for Ms Loukis’ termination. The blame for the zealous way in which the hearing was conducted does not all lie on one side or the other. CONCLUSION I conclude that the principal proceedings were reasonably and properly instituted in this Court and the conduct of proceedings, while unusually hard fought, was not such as to constitute an unreasonable act or omission. I conclude that the costs of the proceedings as a whole should lie where they fall. I will dismiss the Application in a Case with no order as to costs.

Ratio Decidendi

Legal Principle Established

The relevant question is whether the proceeding had reasonable prospects of success at the time it was instituted, not whether it ultimately failed.[20][20] R v Moore; Ex parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470 at 473 per Gibbs JCONSIDERATION The parties have filed extensive written submissions on the issue of costs and also made oral submissions through their counsel at the hearing of the Application in a Case on 25 October 2021. The contest over costs is in my view a continuation of the hard fought nature of the principal proceedings and what I described as the “take no prisoners” approach of both parties.[21] With reference to s 570(2)(a) of the Fair Work Act, I am not persuaded that the principal proceedings were instituted vexatiously or without reasonable cause. The company relies upon the affidavit of Mr Groat who deposes as to a telephone call he received in around November 2019 from Mr James Shaw of the Australian Workers Union, which was representing Ms Loukis. Mr Groat deposes that Mr Shaw invited the company to settle Ms Loukis’ claim for 25 weeks pay or face the cost of the matter going to court. This was described by counsel for the company as an attempted “shakedown”. In contrast, Mr Shaw deposes that Mr Groat telephoned him rather than the other way around and that there was no proposal put to settle for 25 weeks pay. Mr Shaw recalls that Mr Groat invited Ms Loukis to discontinue her claim as it was unmeritorious and Mr Shaw told Mr Groat that if a settlement offer was to be made, he could get instructions on it.[21] principal judgment at [223] The witnesses thus have quite different recollections as to the telephone conversation, except for the approximate time of it in November 2019. Neither made any written record of the conversation. The conversation occurred while the matter was before the Fair Work Commission and well before proceedings were instituted in this Court in March 2020. If a substantial monetary claim was made on behalf of Ms Loukis at that point, it could only have been an ambit claim and would have been so treated. It would have been addressed in the conciliation process before the Fair Work Commission. The matter only came before the Court because conciliation failed. I do not regard the asserted conversation as significant as to the costs of proceedings instituted months later. The proceedings in the Court, when they were instituted, were commenced out of time and Ms Loukis sought an extension of time. As is pointed out by counsel for the company, Ms Loukis’ claim hinged on the wording of the termination letter she received, specifically the reference to “unsatisfactory attendance”. In considering whether to grant an extension of time, I had regard to the ambiguity in the termination letter. It could have referred to lateness or it could have referred to absences, whether explained or unexplained. Ms Loukis relied on s 352 of the Fair Work Act to assert that she was dismissed because she had been temporarily absent due to illness. Given the ambiguity in the termination letter, I found that the claim was arguable.