Macedon Ranges Shire Council v Stefanie Daniliuk

[2021] FWC 5653

[2021] FWC 5653

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.400A—Application for a costs order against a party

Macedon Ranges Shire Council
v
Stefanie Daniliuk
(C2021/4652)

DEPUTY PRESIDENT GOSTENCNIK MELBOURNE, 14 OCTOBER 2021

Application for costs – costs incurred because of unreasonable acts and omission – costs awarded.

[1] Macedon Ranges Shire Council (Costs applicant) has applied for an order for costs pursuant to s 400A of the Fair Work Act 2009 (Cth) (Act) directed to Stefanie Daniliuk (Costs respondent) who was an applicant for an unfair dismissal remedy under pursuant to Part 3-2 of the Act. The costs application was made within the time prescribed by s 402 of the Act. The Costs respondent was advised of the application for costs on 9 August 2021 and directions for the filing and service of submissions were issued to the parties on 10 August 2021 pursuant to which the Costs applicant was required to file and serve its submissions by 11 August 2021 and the Costs respondent by 16 August 2021. The Costs respondent did not file any submission by the date specified.

[2] On 20 August 2021 my Associate wrote to the Costs respondent noting that she had failed to comply with the abovementioned direction and indicated that I would allow her a further period (until 23 August 2021) to file any materials in relations to the Costs application. Nothing has been file by the Costs respondent and no application has been made by her seeking a further period. The Costs applicant has indicated that it is content to have its application determined on the papers without a hearing and given the Costs respondent’s history of failing to comply with directions and her unexplained non-attendance at conferences and hearings scheduled by the Commission, I consider such a course appropriate.

[3] On 9 August 2021, on application by the Costs applicant I dismissed the Costs respondent’s application for an unfair dismissal remedy. 1 I did so because I was satisfied that the Costs respondent had unreasonably failed to attend scheduled conferences and hearings of the Commission in relation to her application and that she had unreasonably failed to comply with directions and amended directions, with which she was required to comply, made in connection with her application.2

[4] It is unnecessary here to rehearse my findings and reasons for the decision to dismiss the Costs respondent’s application save to indicate that I rely on those reasons and findings in arriving at my decision in this application. One further matter is also relevant. Following the Costs applicant filing and serving its materials on 4 August 2021 in accordance with my directions, the Costs respondent wrote to the Costs applicant’s solicitors on 5 August 2021 indicating that, “I’m wanting to discontinue the matter”. The correspondence from the Costs respondent was sent on the morning 3 of the scheduled member-assisted conciliation conference before Commissioner O’Neill, a conference which the Costs respondent also failed, without explanation, to attend.

[5] Later that morning the Costs applicant’s solicitors wrote to the Costs Respondent advising her of the following:

You stated that you want to discontinue your unfair dismissal claim against Macedon Ranges Shire Council.

To discontinue a claim in the Fair Work Commission, a party must complete a Form F50 and file it with the Commission, by sending it to [email protected]. Please cc me when you do so.

I have attached a copy of the Form F50 to this email.

The website where I downloaded it this morning is here, for your reference:

Please do so this morning since there is a conference in the FWC that starts at 10am. 4

[6] No response was received, a notice of discontinuance was not filed, and as already noted the Costs respondent failed to attend the conference before the Commissioner.

[7] Later, on 5 August 2021 my Associate called the Costs respondent and left a voicemail message asking her to call my chambers indicating, amongst other things, a need to discuss whether or not the Costs respondent wished to withdraw the application. My associate then also sent an email to the Costs respondent in the evening of 5 August 2021 asking her if she wished to proceed with the application and providing her with options for withdrawing the matter. The text of the email provided the following:

I refer to the above matter. This matter is listed for hearing before Deputy President Gostencnik on 9 and 10 August 2021.

I note you have not filed material in accordance with the directions issued on 15 June 2021 and varied on 19 July 2021.

You are asked to advise if you wish to proceed with your application.

If you wish to withdraw your application, you can withdraw by doing one of the following:

•  telling us by replying to this email

•  emailing us a completed Form F50 Notice of discontinuance; or

•  telling us by phone on [phone]. 5

[8] No response was received, no contact was made by telephone or otherwise and a notice of discontinuance was not filed.

[9] Section 400A of the Act is a departure from the usual rule that parties must bear their own costs in relation to a matter before the Commission, 6 and provides the Commission with a discretionary power to award costs against a party to a matter arising under Part 3-2 of the Act if the Commission is satisfied that the party against whom costs orders are sought, caused the costs to be incurred by the other party because of an unreasonable act or omission of the first mentioned party in connection with the conduct or continuation of the matter.

[10] As the Full Bench in Gugiatti v SolarisCare Foundation Ltd 7observed, s 400A(1) establishes two preconditions for the making of an order for costs under the subsection (in addition to the requirement in s 400A(2)). The first is that the Commission must be satisfied that a party engaged in an unreasonable act or omission in relation to the conduct or continuation of a matter. The second is that such act or omission caused the other party to the matter to incur costs. Once these preconditions are satisfied, a discretionary power to order the payment of such costs is enlivened.8

[11] As to the first matter the Costs applicant relies on my earlier findings in the s 399A proceeding that the Costs respondent unreasonably failed to attend the member-assisted conciliation conference on 5 August 2021; unreasonably failed attend the substantive hearing on 9 August 2021; and unreasonably failed comply with the directions of the FWC with respect to the filing of material in support of her substantive application. 9 The Costs applicant also relies on the failure by the Costs respondent to file a notice of discontinuance of her unfair dismissal remedy application in the circumstances described above and says that that omission was an unreasonable omission.10

[12] I need not revisit the Costs respondent’s conduct detailed in my s 399A decision. For the reasons there given, I am satisfied that the conduct therein described constitute unreasonable acts on the part of the Costs respondent in connection with the conduct of her unfair dismissal remedy application for the purposes of s 400A(1) of the Act. As to the failure by the Costs respondent to file a notice of discontinuance in relation to her unfair dismissal remedy application I would observe that the Costs respondent indicated her intention to do so to the Costs applicant. However, despite efforts on the part of the Costs applicant and on the part of my Associate over the ensuing days following the first indication, the Costs respondent failed to do so. In these circumstances and given the impending scheduled hearing, I consider that the failure by the Costs respondent to file a notice of discontinuance was an unreasonable omission of the Costs respondent in connection with the continuation of her unfair dismissal remedy application for the purposes of s 400A(1).

[13] As to the second matter, I consider that but for the Costs respondent’s unreasonable acts described in my s 399A decision in connection with the conduct of her unfair dismissal remedy application, the Costs applicant would not have incurred the costs of making and prosecuting its s 399A application. Those costs included solicitors’ costs and the costs of counsel incurred for reviewing materials and preparing for and attending the hearing on 9 August 2021. In addition, I consider that but for the Costs respondent’s unreasonable omission in failing to file a notice of discontinuance in connection with the continuation of her unfair dismissal application, the above-mentioned costs would also not have been incurred by the Costs applicant or at the very least, would have been significantly lessened.

[14] At all times the Costs applicant complied with the Commission’s directions and attended hearings and conferences as scheduled. It also sought to avoid further costs by encouraging the Costs respondent to discontinue after she first gave an indication that she might do so. As noted in the email from the solicitors for the Costs applicant to the Costs respondent of 5 August 2021 and extracted above, a copy of a notice of discontinuance was attached to that email as well as a link to the Commission’s website containing a notice of discontinuance. This made the path for the Costs respondent to file a notice of discontinuance much easier to navigate. Moreover, as the email from my associate to the Costs respondent makes clear, a simple email to my chambers or a telephone call to my chambers indicating that the Costs respondent wished to discontinue would have been a sufficient basis upon which she could have effected a discontinuance of her proceeding without the need to formally file a notice of discontinuance. None of these opportunities were taken up. Instead, the Costs respondent did nothing and the hearing on 9 August 2021 necessarily had to proceed. Thus, it is plainly the case that costs incurred by the Costs applicant associated with the preparation for and attendance at the hearing on 9 August 2021 are costs that are directly attributable to and have been incurred because of the Costs respondent’s unreasonable omission described above.

[15] Therefore, I am satisfied that the second precondition – the causal connection between the Costs respondent’s acts and omission and the costs incurred by the Costs applicant – to the exercise of the Commission’s discretion to order costs under s 400A(1) is met.

[16] As the power to order costs is enlivened it is necessary to consider whether I should exercise my discretion to do so. As the discussion above and that detailed in my s 399A decision discloses, the Costs respondent has been given numerous opportunities to properly and reasonably conduct the unfair dismissal remedy application. She has also been given several opportunities to lodge a notice of discontinuance in relation to her application or otherwise discontinue the application. The Costs respondent has failed to take up any of these opportunities with the consequence that the Costs applicant has incurred unnecessary costs which would most certainly have been avoided but for the Costs respondent’s unreasonable acts and omission.

[17] The scheme of the Act, so far as an unfair dismissal remedy application is concerned, is to generally shield a party from costs incurred by another party in connection with such an application but that shield may be lost if by reason of an unreasonable act or omission by one party in connection with the conduct or continuation of such a proceeding, the other party incurs costs. Though she was given an opportunity to do so, the Costs respondent has not advanced any matter which would tend against the exercise of my discretion in favour of the Costs applicant’s application. In any event there are no matters of which I am aware which would have an effect.

[18] In the circumstances I propose to grant the Costs applicant’s application. I note that although the Costs applicant incurred both instructing solicitors’ and counsel’s costs in connection with the preparation for and attendance at the hearing on 9 August 2021, it seeks only to recover counsel’s costs. I have reviewed the invoice concerning counsel’s costs and consider the costs incurred and charged ($4,000.00), for the preparatory work and subsequent attendance to be reasonable. The amount claimed is likely well short of the actual costs incurred by the Costs applicant by reason of the Costs respondent’s unreasonable acts and omission.

[19] For the foregoing reasons I am satisfied that the Costs respondent caused the Costs applicant to incur costs because of the unreasonable acts and because of the Costs respondent’s omission described above in connection with the conduct and continuation of her unfair dismissal remedy application. I assess the costs incurred at $4,000.00.

[20] A costs order to this effect will be separately issued and will require the Costs respondent to pay the amount of $4,000.00 to the Costs applicant within 14 days of the date of the order.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

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 1   See Daniliuk v Macedon Ranges Shire Council[2021] FWC 4864

 2   Ibid at [16]

 3   Email from the Costs respondent to Hunt & Hunt, Solicitors for the Costs applicant dated 5 August 2021 and sent at 7:06 am

 4   Email from Hunt & Hunt, Solicitors for the Costs applicant to the Costs respondent dated 5 August 2021 and sent at 8:09 am

 5   Email from my Associate to the Costs respondent dated 5 August 2021 and sent at 6:10pm

 6   Fair Work Act 2009, s 611(1)

 7   [2016] FWCFB 2478

 8   Ibid at [43]

 9   Outline of submissions of the Costs applicant dated 11 August 2021 at [7]

 10   Ibid at [8]-[11]