Michael Cincotta v Coffee Management and Solutions Pty Ltd

[2015] FWC 7539

[2015] FWC 7539

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Michael Cincotta
v
Coffee Management and Solutions Pty Ltd
(U2015/2743)

DEPUTY PRESIDENT BOOTH SYDNEY, 19 NOVEMBER 2015

Costs application.

[1] On 14 September 2015 I found that Mr Michael Cincotta was unfairly dismissed by Coffee Management Solutions Pty Ltd (Coffee Management) on 14 January 2015. 1 On 28 October 2015 I ordered that Coffee Management pay Mr Cincotta compensation of $10,621.50, less appropriate taxation, in lieu of reinstatement.2

[2] On 14 September Mr Cincotta sought costs in relation to the application and Mr Maiorana, who appeared on his behalf by permission of the Commission, made oral submissions. The application was made in within 14 days of the decision in compliance with s. 402 of the Act and I am satisfied that the Commission has the jurisdiction to consider this costs application.

[3] I gave directions to Mr Cincotta to provide any further submissions by 21 September 2015, with Coffee Management having until 28 September 2015 to provide their submissions. Mr Cincotta provided submissions by the due date but Coffee Management has not provided any submissions. In my decision of 14 September 2015 I indicated that unless I received submissions to the contrary I would make a decision on the papers. No such submission has been made. This is my decision in relation to costs after consideration of the submissions filed and served by Mr Cincotta on 17 September 2015 and his oral submissions before me on 14 September 2014.

[4] For reasons outlined below I have decided Coffee Management’s conduct in this matter is such as to satisfy me that Coffee Management caused some of Mr Cincotta’s costs to be incurred because of an unreasonable act or omission in connection with the conduct or continuation of the matter. I have ordered Coffee Management to pay costs of $11,150.33.

[5] In an earlier decision concerning a jurisdictional objection 3 I summarised Coffee Management’s engagement with the conduct of the application as follows:

“[6] Coffee Management was not as engaged in the conduct of this matter as would have been optimal. They did not attend a conciliation listed for 25 February 2015. A second conciliation was offered to replace the first conciliation and they did not reply. They did not provide a Form F3 Response to the application until 8 May, received by Mr Cincotta and the Commission just before the matter was listed for merits arbitration by me on 13 May 2015. The first time either Mr Cincotta or the Commission knew that there was a jurisdictional objection was when the F3 was received. This necessitated the adjournment of the hearing and, due in part to my absence on scheduled leave, the jurisdictional objection could not be heard until 13 July 2015. Orders requiring production of documents dated 18 June 2015 were served by Mr Cincotta’s representative however, Mr Laface submitted that the envelope containing the Orders was not opened by his office until 7 July and it was not practical to comply with the Order ahead of this hearing. No other organisation upon which the Orders were served complied with the Orders either. Mr Cincotta did not press the Orders, preferring to conclude the matter in the hearing before me without further adjournment. Coffee Management did not put forward any oral evidence and mounted its jurisdictional objection largely based on Mr Cincotta’s evidence.”

[6] Coffee Management’s approach to the conduct of the matter did not improve over time. A directions conference was conducted on 30 July 2015 and at the same time as making directions, I asked the parties if they would like to engage in conciliation prior to the hearing, since the first two attempts had not been taken up by Coffee Management. Mr Cincotta and Coffee Management agreed to engage in conciliation but in the event, Coffee Management did not participate and a conciliation was not held.

[7] Directions for the filing and serving of submissions and evidence on the merits of the application were complied with by Mr Cincotta but no submissions were received from Coffee Management. On 8 September 2015 my Associate wrote to Coffee Management to alert them to their failure to comply with directions and informed them that the case would go ahead on 14 September 2015. There was no reply. On the day of hearing they did not appear. When my Associate contacted their representative she was advised by the firm that they were no longer retained by Coffee Management. I note that we had not, and never have, received a Form F54 Representative Ceasing to Act.

[8] The matter proceeded on 14 September 2015 with only Mr Cincotta, represented by Mr Maiorana, presenting his case.

[9] This is the background to Mr Cincotta’s application for costs and is also the basis for his application.

[10] His application is made under both s.400A and s.611 of the Act. I will deal with each section in reverse order.

[11] Section 611 is as follows:

“611 Costs

(1) A person must bear the person’s own costs in relation to a matter before the FWC.

(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.

Note: The FWC can also order costs under sections 376, 400A, 401 and 780.

(3) A person to whom an order for costs applies must not contravene a term of the order.

Note: This subsection is a civil remedy provision (see Part 4-1).”

[12] Mr Cincotta contends that the employer response was made vexatiously or without reasonable cause and that it should have been reasonably apparent that the employer’s response to the application had no reasonable prospects of success.

[13] I am not satisfied that Coffee Management’s response was motivated by the predominant purpose of harassing or embarrassing Mr Cincotta or to gain a collateral advantage. 4

[14] I am not satisfied that Coffee Management’s response was made without reasonable cause.

[15] I am not satisfied that Coffee Management’s response had no reasonable prospects of success.

[16] I reject the application for costs against Coffee Management made pursuant to s. 611.

[17] Coffee Management’s downfall in the response to the application was that the response was tardy, sporadic and incomplete.

[18] Mr Cincotta’s application for costs under s. 400A of the Act has some merit. This section is as follows:

“400A Costs orders against parties

(1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter.

(2) The FWC may make an order under subsection (1) only if the other party to the matter has applied for it in accordance with section 402.

(3) This section does not limit the FWC’s power to order costs under section 611.”

[19] In examining whether Coffee Management caused some of Mr Cincotta’s costs to be incurred because of an unreasonable act or omission in connection with the conduct or continuation of the matter I have divided the case into a series of stages.

[20] In each stage I have asked myself the two questions “Were any of the acts or omissions of Coffee Management unreasonable and if so, did an unreasonable act or omission cause Mr Cincotta’s costs to be incurred?”

Stage 1 Prepare application

[21] There was no unreasonable act or omission on the part of Coffee Management that caused Mr Cincotta to incur costs in making his application so the answer to both questions is “no”.

Stage 2 Respond to the application

[22] Coffee Management did not provide a Form F3 Response to the application when asked by the Commission to do so and has given no explanation as to why it failed to do so. The answer to the first part of the question is “yes”. This unreasonable omission caused costs to be incurred by Mr Cincotta in conferences and additional preparation anticipating the reasons for dismissal so the answer to the second part of the question is “yes”.

Stage 3 Prepare for and attend conciliation

[23] Coffee Management did not attend a conciliation that was listed, did not communicate in advance of the listing that it was not going to attend and did not foreshadow a jurisdictional objection to the application as a reason for not attending. This was an unreasonable omission on the part of Coffee Management that caused Mr Cincotta to incur costs in preparing for, and attending the conciliation so the answer to both questions is “yes”.

Stage 4 Offered second conciliation

[24] Coffee Management did not respond to the offer for a second conciliation that was proposed in light of Coffee Management’s failure to attend the first. This was an unreasonable omission on the part of Coffee Management, so the answer to the first questions is “yes”. However this unreasonable omission did not of itself cause any costs to be incurred by Mr Cincotta so the answer to the second part of the question is “no”.

Stage 5 Prepare for arbitration on merits

[25] Coffee Management provided a Form F3 Employer Response to Unfair Dismissal Application on 8 May 2015, just days before the application was listed for merits arbitration. Coffee Management had not complied with directions to provide submissions in response to the application and it came as a surprise to Mr Cincotta and the Commission when the jurisdictional objection was raised. Mr Cincotta had incurred costs in preparing for the merits arbitration and attending a hearing that was adjourned. The merits arbitration was adjourned and a jurisdictional hearing listed. This was an unreasonable act on the part of Coffee Management, so the answer to the first questions is “yes”. The answer to the second part of the question is “partly” because as it transpired the preparation for the merits arbitration was partly relied upon when the matter was finally heard for merits arbitration on 14 September 2014.

Stage 6 Prepare for and attend jurisdictional hearing

[26] Coffee Management objected to Mr Cincotta’s application on the ground that he was not a person protected from unfair dismissal because he had not served the minimum employment period. 5 Orders to produce were not complied with and costs were incurred by Mr Cincotta in defending the jurisdictional objection that would not have been incurred had the Orders to Produce been complied with. I found that he had served the minimum employment period and his application could be heard on the merits. However the jurisdictional objection was not of itself unreasonable. The costs incurred in preparing for and appearing at the jurisdiction hearing would have had to have been incurred in any event, even if in a more timely way, had Coffee Management raised this objection at the outset. The answer to the first question is “yes” and the second question “partly”.

Stage 7 Prepare for and attend arbitration on merits

[27] Coffee Management did not comply with directions in relation to the hearing of the application on the merits and did not appear at the hearing. Although Mr Cincotta mainly relied upon written submissions prepared for the hearing that was to have been held prior to the jurisdictional objection, further preparation for the hearing in the form of conferences was necessary. Mr Cincotta was represented at the hearing. The failure to comply with directions and the failure to appear was an unreasonable omission on the part of Coffee Management. Coffee Management’s failure to comply caused Mr Cincotta to incur costs at this stage so the answer to the first question is “yes” and the answer to the second question is “partly”. Some of the costs incurred would have had to be incurred in any event.

Stage 8 Prepare submissions as to compensation

[28] I asked Mr Cincotta to prepare submissions in relation to the amount of compensation and the costs incurred in the preparation of such submissions were not incurred because of an unreasonable act or omission on the part of Coffee Management. The answer to both questions is “no”. The costs incurred would have had to be incurred in any event.

Stage 9 Prepare submissions as to costs.

[29] Coffee Management’s conduct in this matter has been unreasonable at a number of stages and were it not for this conduct, Mr Cincotta would not have had a basis for making a costs application. There were a number of unreasonable acts and omissions on the part of Coffee Management that caused Mr Cincotta to incur costs in preparing his costs application so the answer to both questions is “yes”.

[30] Coffee Management’s conduct in this matter is such as to satisfy me that that it caused costs to be incurred because of an unreasonable act or omission in connection with the conduct or continuation of the matter. Therefore I find that I have the jurisdiction to exercise my discretion in this matter.

[31] Some of Mr Cincotta’s costs in pursuing his application would have been incurred in the absence of an unreasonable act or omission on the part of Coffee Management. I do not consider that it is appropriate to order Coffee Management to pay those costs.

[32] However some of Mr Cincotta’s costs are attributable to the unreasonable acts or omissions of Coffee Management detailed in the stages outlined above.

[33] Mr Maiorana has provided a schedule of costs via a client time sheet. I am not able to precisely match the itemised costs to the unreasonable acts or omissions outlined above, however I estimate that at least one third of the time spent by Mr Maiorana on Mr Cincotta’s case was attributable to the acts or omissions of Coffee Management.

[34] The amount of additional cost that I estimate was incurred by Mr Cincotta is $11,150.33, inclusive of GST, and I order that Coffee Management pay this amount to Mr Cincotta within 14 days. An order will issue with this decision.

DEPUTY PRESIDENT

Appearances:

M. Maiorana, Maiorana Lawyers, for the Applicant.

Hearing details:

2015

Sydney:

14 September.

Final written submissions:

Applicant Submissions on Compensation and costs received 17 September 2015.

 1   PN1068 to PN1106 Transcript of 14 September 2015.

 2   Michael Cincotta v Coffee Management and Solutions Pty Ltd[2015] FWC 7389.

 3   Michael Cincotta v Coffee Management and Solutions Pty Ltd[2015] FWC 5021.

 4   Holland and another v Nude Pty Ltd T/A Nude Delicafe[2012] FWAFB 6508.

 5 Section 383 Fair Work Act 2009.

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