Marsh, Ralph Benson v Adamson, Robert McColl

[1985] FCA 108

Re: RALPH BENSON MARSH AND CHARLES BALI
And: ROBERT McCOLL ADAMSON
No. 37 of 1984
Industrial Law
5 FCR 124
11 IR 47

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
INDUSTRIAL DIVISION
St. John(1), Northrop(2) and Wilcox(1) JJ.

CATCHWORDS

Industrial law - Costs - appeal to Full Court held incompetent - applicability of s.197A of the Conciliation and Arbitration Act 1904 - whether" reasonable cause" for instituting appeal - organisation a party to election inquiry - whether reasonable to be represented in appeal concerning subpoenas which it did not issue or receive

Conciliation and Arbitration Act 1904 ss.2(f), 133, 133B, 164 AND 197A

Conciliation and Arbitration Act 1904 amendments (Act No. 138 of 1973)

Federal Court Act ss.24,43

Federal Court Rules 0.52 r.18

Industrial Law - Costs - Appeal to Full Court held incompetent - Whether reasonable cause for instituting appeal - Whether Conciliation and Arbitration Act 1904, s 197A applies to Federal Court of Australia - Conciliation and Arbitration Act 1904 (Cth), ss 2(f), 133, 133B, 164, 197A - Federal Court of Australia Act 1976 (Cth), ss 24, 43 - Federal Court Rules, O 52, r 18.

HEADNOTE

Held (per St John and Wilcox JJ, Northrop J. dissenting): (1) "The court" in s 197A(b) of the Conciliation and Arbitration Act 1904 (Cth) includes the Federal Court of Australia in both its original and appellate jurisdictions.

Brophy v. Mapstone (1984) 3 FCR 227, followed.

(2) Observations concerning the requirements of a finding that an action was "vexatious and without reasonable cause" within the meaning of s 197A of the Conciliation and Arbitration Act 1904.

HEARING

Sydney, 1984, December 17; 1985, February 11, 12; March 11, 29. #DATE 29:3:1985
APPEAL

Judgment on the question of costs of an appeal dismissed as incompetent.

J. L. Trew QC and J. A. McCarthy, for the appellants.

M. F. Moore, for the respondent.

Cur adv vult

Solicitors for the applicants: Dawson & Waldron.

Solicitor for the respondent: Australian Government Solicitor.

GFV

ORDER

1. As between the appellants and the organisation, the Amalgamated Metals Foundry and Shipwrights' Union, there is no order as to costs.

2. As between the appellants and the respondent Robert McColl Adamson, the appellants are ordered to pay that respondent's costs.

Appeal dismissed with costs

JUDGE1

When judgment in this matter was handed down on 11 March 1985 the question of costs was reserved and the parties agreed that written submissions, which were later made, would be appropriate.

Both the respondent Adamson, and the Amalgamated Metals Foundry and Shipwrights' Union ("the organisation"), which was a party to the proceedings before Gray J. by virtue of being given leave to appear pursuant to s.164 of the Conciliation and Arbitration Act 1904 ("the Act"), have sought orders in their favour.

We have both had the opportunity to read the reasons of Northrop J. but, with respect, we feel that we should follow and apply the recent, closely reasoned, conclusions reached by a Full Court of this Court in Brophy v. Mapstone (1984) 56 A.L.R. 135 where it was held that the expression "the Court" appearing in s.197A(b) of the Act included the Federal Court in its original and appellate jurisdictions.

Dealing firstly with the application for costs by the organisation, we are of the view that this application has no merit as the organisation did not issue, nor was it the recipient of, subpoenas in respect to which the appeal was based. Being made a party to the election inquiry does not, in our view, entitle it to costs where the appeal does not in any way affect its interests in the inquiry, except to the extent that it may prefer to seek a particular interpretation of the definition of "irregularity" in s.4 of the Act.

So far as the application of the respondent Adamson, is concerned, consideration has to be given to s.197A of the Act and, in particular, to the words "vexatious or without reasonable cause". As to these words, the only authority cited to us is the judgment of Gibbs J. (as he then was) in The Queen v. Moore and Others; Ex parte Federated Miscellaneous Worker's Union of Australia (1978) 140 C.L.R. 470 at 473, where his Honour said:-

"In my opinion a party cannot be said to have commenced a proceeding "without reasonable cause", within the meaning of that section, simply because his argument proves unsuccessful. In the present case the argument presented on behalf of the prosecutor was not unworthy of consideration and it found some support in the two decisions of this Court to which I have referred. The fact that those decisions have been distinguished, and that the argument has failed, is no justification for ordering costs in the face of the prohibition contained in s.197A."

His Honour then expressed the view that he would make no order as to costs. Barwick CJ., Jacobs and Aickin JJ. expressed no opinion on the issue of costs.

Section 197A of the Act was introduced by the 1973 amendments (Act No. 138 of 1973). In the same Act there was added to the objects in s.2 a further clause (f) "to encourage the democratic control of organisations so registered and the full participation by members of such an organisation in the affairs of the organisation". Substantial amendments were also made to s.133 whereby organisation rules were made to comply with certain criteria relating to elections, ballots, filling of offices and related matters. These additions to the Act, particularly to the "objects" section, could reasonably lead to the conclusion that s.197A was designed to allow members and organisations to approach the Court when they had reasonable cause so to do undeterred by the fear of costs being awarded against them if they were in fact unsuccessful.

It is doubtful that, in enacting s.197A of the Act, the Parliament had in mind a case such as the present. The appellant Marsh was not a party to the proceedings before the Judge inquiring into the election. He was merely the recipient of a subpoena. If the position were reversed, and a mere recipient of a subpoena was the successful respondent in a purported appeal, it would be a strange result for him to be deprived of his costs by a provision enacted for the purpose which lies behind s.197A. Nonetheless, the Court's power to award costs depends upon a conclusion that the appeal was instituted "without reasonable cause".

In this appeal there was no authority of any substance on which argument could be based that the appeal was not covered by the prohibition against appeals in s.118B of the Act. Further, had the appeal not been held to be incompetent because of the existence of that section, the appellants would have had to go on and convince this Court that there was an unarguable case that the facts alleged did not constitute an "irregularity". Such a submission would inevitably have failed because of the strictures upon summary dismissal of proceedings expressed by Barwick CJ. in General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) and Others (1964) 112 C.L.R. 125 at 129.

For these reasons we are of the view that the appeal was instituted without reasonable cause within the meaning of s.197A of the Act and we would order that the appellants pay the costs of the respondent Adamson.

As to the possible application of Order 52 rule 18 of the Rules of Court and, in particular, sub-rule (3) which provides that if a respondent does not move for an order dismissing an appeal as incompetent and on the appeal it is nevertheless dismissed as incompetent, unless the Court otherwise orders, the respondent shall be denied his costs of the appeal and the Court may order the respondent to pay the appellant "any costs of the appeal proving useless or unnecessary". We think that the Court's discretion would be appropriately exercised in favour of the respondent in this instance because, when the matter was called over before the Chief Judge of this Court, it was submitted on behalf of the respondent that the appeal was incompetent. The issue of competence of the appeal was squarely raised and the appellants put on notice that such issue would be raised. Apparently for practical reasons, and acceding to the submissions of the appellants, the Chief Judge did not order a preliminary hearing as to competence, but all parties came to this Court recognising, as their written outlines of argument show, that this preliminary question arose. Under those circumstances, the failure of the respondent Adamson to file a notice of objection to competency, serving merely to confirm the point already taken, should not be allowed to deprive him of his costs.

JUDGE2

On 11 March 1985, the appeal herein was dismissed as being incompetent and reasons for judgment were published. At that time, the question of costs was reserved. The parties to the appeal were given leave to make written submissions in relation to that question. The Court has received submissions supporting the making of orders that the appellants pay the costs of the respondent Adamson and the costs of the Amalgamated Metals Foundry and Shipwrights' Union ("the organization"). The Court has received submissions on behalf of the appellants that no costs shall be awarded.

In considering the question of costs, it is necessary to have regard to and to apply a number of statutory provisions as well as the provisions of the Rules of Court. Reference is made to the Federal Court of Australia Act 1976 ("the Federal Court Act") and in particular to the following provisions of that Act, namely the meaning to be given to the word "Court" when used in that Act; see s.4, sub-section 19(1), paragraph 24(1)(a), s.25 and s.43. For the sake of clarity, the words "the Federal Court" are used in these reasons when referring to the Court constituted by the Federal Court Act. Reference is made to the Conciliation and Arbitration Act 1904 ("the C. & A. Act"), and in particular to the following provisions of that Act, namely the meaning to be given to the words "the Court" when used in that Act, see sub-section 4(1), s.116, sub-section 118A(1), s.118B, paragraph 159(4)(a), s.165, s.168 and s.197A. For the sake of clarity, the words "the Industrial Court" are used in these reasons when referring to the court constituted by the C. & A. Act. Reference is made to Order 52 of the Rules of Court, and in particular Rule 18.

Under paragraph 159(4) of the C. & A. Act, an inquiry is deemed to have been instituted in the Industrial Court when the requirements of s.159 have been satisfied. Under s.165 of the C. & A. Act, the Industrial Court has the power to inquire into and determine the matters referred to in that section and has the power to make orders specified in that section. Under sub-section 118A(1) of the C. & A. Act, the jurisdiction and powers expressed by paragraph 159(4) and s.165 of that Act to be vested in or exercisable by the Industrial Court are vested in and exercisable by the Federal Court, and by sub-section 19(1) of the Federal Court Act come within the original jurisdiction of the Federal Court.

Section 116 of the C. & A. Act confers a jurisdiction or power on the Industrial Court to make orders as to the costs and expenses (including the expenses of witnesses) of proceedings before the Industrial Court. Under paragraph 118A(1)(b) of the C. & A. Act, the reference in s.116 of the C. & A. Act to the Industrial Court is not, in relation to and to matters arising out of the jurisdiction or power conferred on the Industrial Court by s.116 of the C. & A. Act to be read as a reference to the Federal Court. It follows, therefore, that the Federal Court does not derive power to make orders as to costs of proceedings being an inquiry under Part IX of the C. & A. Act from s.116 of the C. & A. Act. The power of the Federal Court to make orders for costs of proceedings, being an inquiry under Part IX of the C. & A. Act, is to be found in s.43 of the Federal Court Act. Sub-section (1) of that section is set out:

"43.(1) The Court or a Judge has jurisdiction to award costs in all proceedings before the Court (including proceedings dismissed for want of jurisdiction) other than proceedings in respect of which any other Act provides that costs shall not be awarded."

In that sub-section the court is the Federal Court.

For the purpose of applying s.43 of the Federal Court Act it is necessary to determine whether this appeal constitutes a proceeding "in respect of which any other Act provides that costs shall not be awarded". Before turning to that question, however, reference should be made to the statutory provisions allowing appeals to a Full Court of the Federal Court. The C. & A. Act contains no provisions allowing an appeal to a Full Court of the Industrial Court from a judgment of the Industrial Court constituted by a single Judge. Under paragraph 24(1)(a) of the Federal Court Act, the Federal Court has jurisdiction to hear and determine appeals from judgments of the Federal Court constituted by a single Judge. This jurisdiction forms part of the appellate jurisdiction of the Federal Court and is exercised by a Full Court; see s.25 of the Federal Court Act. Paragraph 118B(1)(a) of the C. & A. Act removes the right of appeal given by paragraph 24(1)(a) of the Federal Court Act where the judgment sought to be appealed from is made in a proceeding under Part IX of the C. & A. Act. The reasons for judgment given herein on 11 March 1985 determine that question. The fact that the appeal herein was incompetent does not remove the power of the Federal Court to make an order for costs under s.43 of the Federal Court Act.

In Brophy v. Mapstone (1984) 56 A.L.R. 135, a Full Court constituted by Smithers, Keely and Morling JJ., in the exercise of the appellate jurisdiction of the Federal Court, held that the Federal Court had no power to award costs in favour of the successful respondents to an appeal under sections 24 and 25 of the Federal Court Act from a judgment given by the Federal Court constituted by a single Judge in proceedings in a matter arising under the C. & A. Act. In coming to that decision, the Full Court held that s.197A of the C. & A. Act constituted a provision of an Act which provided that costs should not be awarded by the Federal Court under s.43 of the Federal Court Act. Section 197A of the C. & A. Act is set out:

"197A. A party to -

(a) a proceeding before the Commission or the Registrar;

(b) a proceeding, including an appeal, before the Court, or before a court of a State or Territory, in a matter arising under this Act; or

(c) a proceeding before the High Court -

(i) being an appeal from a judgment, decree, order or sentence of the Court or any other court under this Act; or

(ii) being a proceeding in respect of an award proposed to be made, made or purporting to have been made, a decision proposed to be given, given or purporting to have been given, or any other act proposed to be done, done or purporting to have been done, under this Act or in respect of a failure to make an award, give a decision or do any other act that is required or permitted by this Act to be made, given or done,

shall not be ordered to pay any costs incurred by any other party to that proceeding except where the party against whom the order is made instituted the proceeding vexatiously or without reasonable cause."

That section was first inserted into the C. & A. Act in 1973 at a time before the Federal Court was constituted. By reason of sub-section 4(1) of the C. & A. Act, in that Act, except where otherwise clearly intended, the words "the Court" mean the Industrial Court created by the C. & A. Act. It follows, therefore, that in 1973 when s.197A of the C. & A. Act was first inserted into that Act, the words "the Court" appearing in paragraph 197A(b) of the C. & A. Act could refer to the Industrial Court only and to no other court. In Brophy v. Mapstone, above, the Full Court, for the reasons expressed at pp.146-8, held that in that paragraph the expression "the Court" includes the Federal Court in its original and appellate jurisdictions. In Brophy v. Mapstone, the proceedings before the Federal Court constituted by a single Judge had been brought under ss.140 and 141 of the C. & A. Act, and by reason of sub-section 118A(1) of that Act and s.19 of the Federal Court Act, had been heard and determined in the Federal Court. In holding that the Full Court had no power to award costs in favour of the successful respondents, the Court, in a joint judgement, after referring to the relevant provisions of the C. & A. Act and to sub-section 43(1) of the Federal Court Act, said at pp.147-8:

"It must be observed, however, that, although the power of the Australian Industrial Court to make orders for costs under s.116 is not vested in the Federal Court by s.118A that section did vest in that court the jurisdiction under the Act of the Australian Industrial Court. Thus when, according to that vesting, the Federal Court exercises jurisdiction in a matter arising under the Act, s.43 of the Federal Court Act speaks in relation thereto and confers power to make an order for costs except where the proceedings before the court are of a class in respect of which another Act provides that costs shall not be awarded. Section 197A is such a provision of another Act if the Court referred to in para (b) of s.197A includes the Federal Court. It inevitably appears, however, that it does so because of the terms of para (b) of s.118A(1). It is apparent that the expression 'that jurisdiction' in para (b) of s.118A(1) refers to the jurisdiction vested in or exercisable by the Federal Court by para (a) of that section, namely, the jurisdiction and powers vested in or exercisable by the Australian Industrial Court pursuant to the Act as so vested in or exercisable by the Federal Court pursuant to s.118A(1)(a) of the Act. It is in respect of matters arising in the Federal Court in its Industrial Division that para (b) of s.118A(1) provides that a reference to the Court shall be read as a reference to the Federal Court of Australia in its Industrial Division. The present proceedings do arise in respect of such a matter. Section 4 of the Act provides that therein the expression 'the Court' means the Australian Industrial Court, except where otherwise clearly intended. In para (b) of s.118A(1) there is manifested a clear intention that, in relation to matters arising in the exercise of the jurisdiction vested in it by s.118A(1), the expression 'the Court' in the Act includes the Federal Court and, accordingly, that expression in para (b) of s.197A of the Act includes the Federal Court. As the matter before us is an appeal in a matter arising under the Conciliation and Arbitration Act 1904 it is clear that the power of the Federal Court of Australia under s.43 of the Federal Court of Australia Act to award costs extends to those proceedings but subject to the provisions of s.197A."

With respect to that expression of opinion, it is apparent that the Court made no reference to the fact that s.197A of the C. & A. Act does not confer any jurisdiction or power on the Industrial Court or, for that matter, any of the other courts or tribunals mentioned in that section. The provisions of s.197A of the C. & A. Act impose limitations on power. The power on which the limitation is imposed is to be found in some other statutory provision such as s.26 of the Judiciary Act 1903 which confers jurisdiction upon the High Court to award costs in all matters brought before that court. Section 116 of the C. & A. Act confers upon the Industrial Court the power to award costs. Section 43 of the Federal Court Act confers upon the Federal Court the power to award costs. It is difficult to see how, with respect to paragraph 197A(b) of the C. & A. Act which does not confer jurisdiction or power on "the Court", it can be said that the reference to "the Court" in relation to and to matters arising out of a jurisdiction or of powers referred to in paragraph 118A(1)(b) of the C. & A. Act manifests a clear intention that in paragraph 197A(b) of the C. & A. Act the expression "the Court" includes the Federal Court.

In Part VA of the C. & A. Act, which contains the provisions relating to the transfer of jurisdiction of the Industrial Court to the Federal Court, the legislature has been careful in the use of the words "the Court" and the words "Federal Court of Australia". In the sections contained in that Part, the expression "the Court" of necessity does not include the Federal Court.

Likewise, in those sections of the C. & A. Act which confer jurisdiction or powers upon the Industrial Court, it can be accepted that by reason of paragraph 118A(1)(b) of the C. & A. Act, and except with respect to those sections specified in that paragraph, a reference to the Court is to be read as a reference to the Federal Court of Australia in its Industrial Division, but that reference is limited to that jurisdiction and power and matters arising out of that jurisdiction and those powers as so vested or execisable. That is not the same as saying that in those sections the words "the Court" are to be given the meaning of "the Federal Court". Sub-section 118A(1) is concerned with jurisdiction and powers and matters arising out of that jurisdiction and those powers and the vesting of that jurisdiction and those powers in the Federal Court, not the Court itself.

The extended meaning to be given to the expression "the Court" in the C. & A. Act cannot apply to that expression whenever occurring in the C. & A. Act. In Part VA of the C. & A. Act, the extended meaning cannot apply. Likewise, in s.198 of the C. & A. Act. The C. & A. Act does not confer a power on the Judges of the Industrial Court to make rules of court making provision for or in relation to the practice and procedure of the Industrial Court. Section 198 of the C. & A. Act conferred a power on the Governor-General to make regulations "for regulating the practice and procedure" of the Industrial Court; see paragraph 198(1)(a). See also the use of the expression "the Court" in sub-section 198(2). Section 59 of the Federal Court Act confers power on the Judges of the Federal Court to make rules of court making provision for the practice and procedure of the Federal Court. It is difficult to see how, in s.198 of the C. & A. Act, the expression "the Court" includes the Federal Court.

Further matters need to be considered in relation to the appellate jurisdiction of the Industrial Court and of the Federal Court. Under the C. & A. Act, the appellate jurisdiction of the Industrial Court was limited to appeals from State or Territory courts. There was no appellate jurisdiction with respect to judgments of the Industrial Court constituted by a single Judge. Thus, under paragraph 197A(b) of the C. & A. Act, the reference to a proceeding, including an appeal, of necessity was limited to appellate jurisdiction from a State or Territory court. Under s.13 of the Federal Court Act, if the jurisdiction of the Federal Court is required by any Act to be exercised in the Industrial Division of the Federal Court, that jurisdiction and jurisdiction incidental to the exercise of any such jurisdiction must be exercised in the Industrial Division of the Federal Court. Paragraph 118A(1)(b) is such a requirement and the original jurisdiction of the Federal Court with respect to proceedings coming to the Federal Court by reason of sub-section 118A(1) of the C. & A. Act must be heard and determined in the Industrial Division of the Federal Court. Different considerations apply with respect to appeals. The C. & A. Act does not confer a jurisdiction on the Federal Court to hear appeals in a matter under the C. & A. Act. Paragraph 118B(1) of the C. & A. Act imposes limitations on appeals and proceedings under Part IX of the C. & A. Act, but the right to appeal is conferred by s.24 of the Federal Court Act and the jurisdiction of the Federal Court to hear and determine the appeal is conferred by sections 24 and 25 of the Federal Court Act. Even on the views expressed in Brophy v. Mapstone, above, nice questions arise whether a proceeding in the Federal Court, being an appeal under s.24 of the Federal Court Act, comes within the limitation expressed in paragraph 197A(b) of the C. & A. Act. It is noted that s.25 does not state expressly that a Full Court hearing an appeal from the Federal Court in its Industrial Division must be constituted by Judges attached to the Industrial Division of the Federal Court; see sub-sections 14(1) and (2) and s.25 of the Federal Court Act and compare those sub-sections with sub-sections 118A(4A) and (4B) of the C. & A. Act.

No appeal could have been taken to the High Court in Brophy v. Mapstone, above, and no appeal can be taken to the High Court in this case; see sub-section 118B(2) of the C. & A. Act. In those circumstances, the need for the strict application of the doctrine of precedent, as discussed by Northrop J. in Wood v. City of Melbourne (1979) 41 F.L.R. 22 and pp.23-26, does not apply. Reference is made also to Pyneboard Pty. Ltd. v. Trade Practices Commission (1982) 57 F.L.R. 368 per Northrop, Deane and Fisher JJ. at p.371.

Nevertheless, this is not an appropriate case to reconsider Brophy v. Mapstone, above. Even if the Federal Court had power to award costs in this appeal, in the exercise of discretion, I would not make the orders sought.

Section 168 of the C. & A. Act contains special provisions empowering the Attorney-General to authorize the Commonwealth to pay the costs and expenses of parties to an inquiry. Sub-section 168(5) provides:

"168(5) Nothing in this section shall limit the power of the Court to make an order as to the costs and expenses (including expenses of witnesses) of proceedings before the Court in or in connexion with an inquiry."

That sub-section does not confer a power to make an order as to costs. It merely refers to a power which arises from another source and declares that the earlier provisions of s.168 do not limit that power.

Under 0.52 r.18 of the Rules of Court, a respondent to an appeal may move on notice for an order dismissing an appeal as incompetent. Under sub-rule 8(3), if a respondent does not so move, but the appeal nevertheless is dismissed by the court as incompetent "the respondent shall not, unless the court otherwise orders, receive any costs of the appeal, and the court may order that he pay the appellant any costs of the appeal proving useless or unnecessary".

In this appeal, neither the respondent Adamson nor the organization moved on notice for an order dismissing the appeal as incompetent. It is true that on the callover of the matters pending before the Full Court the question of competency was raised. That does not excuse the absence of action under sub-rule 18(1). In those circumstances, there is no reason why the Court should exercise its discretion to award costs to either the respondent Adamson or the organization. The appellants have not sought an order for the costs of the appeal proving useless or unnecessary.

On the assumption that s.197A of the C. & A. Act applies to this appeal, in my opinion there is no basis for holding that the appellants instituted the appeal vexatiously or without reasonable cause; see Heidt v. Chrysler Australia Ltd. (1976) 26 F.L.R. 257 commencing at p.271, a decision of the Industrial Court. In that case, no question could have arisen with respect to whether the expression "the Court" in paragraph 197A(b) included the Federal Court. See also R. v. Moore; Ex parte Federated Miscellaneous Workers' Union of Australia (1978) 140 C.L.R. 470 per Gibbs J. at p.473. In my reasons for judgment herein published on 11 March 1985, I expressed views on why the appeal was incompetent. In my opinion it cannot be said that the contentions of the appellants were "manifestly groundless" and were "bad beyond argument". The respondent Adamson did not give notice of motion under 0.52 r.18. The respondent Adamson did not object to the appellants presenting their submissions on the merits of the appeal before a decision had been given on whether the decision was competent. The respondent Adamson and the organization presented their submissions on the merits of the appeal. The Court has expressed views on the merits of the appeal. In my opinion all these facts support the view that the appellants did not institute the appeal vexatiously or without reasonable cause.

I would make no order as to the costs of the appeal.