Mr Raymond Cordero Pagkaliwangan v Siganto & Stacey Pty Limited

[2011] FWA 3989

[2011] FWA 3989

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Mr Raymond Cordero Pagkaliwangan
v
Siganto & Stacey Pty Limited
(U2010/9316)

COMMISSIONER SIMPSON BRISBANE, 2 AUGUST 2011

Costs Application

[1] This is an application made pursuant to section 611 of the Fair Work Act 2009 (the FW Act) by Siganto and Stacey Pty Limited (the “Employer”) for costs against Mr Raymond Pagkaliwangan (the “Applicant”) in relation to his unsuccessful application for an unfair dismissal remedy. In my decision of 10 December 2010 I upheld a jurisdictional objection of the Employer to the unfair dismissal application on the basis that I was not satisfied that exceptional circumstances existed in order to extend the time limit for filing the application. 1

[2] This matter was listed for hearing on Wednesday 29 June 2011 with directions for submissions to be filed by 16 June 2011, 23 June 2011 and final reply submissions from the Employer by 28 June 2011.

[3] Section 611 of the FW Act provides as follows:

611 Costs

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

(2) However, FWA may order a person (the first person) to bear some or all of the costs of another person in relation to an application to FWA if:

(a) FWA is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) FWA 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: FWA can also order costs under sections 376, 401 and 780.

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

[4] The power to award costs under s.611 is discretionary.

[5] The extension of time jurisdictional objection was listed for a Conference/Hearing on Friday 20 August 2010. Both parties filed submissions and affidavit material in advance of that hearing date. Mr Pagkaliwangan failed to appear for the hearing of the matter at 9:15am on 20 August 2010. He contacted my chambers later that morning and advised he had forgotten. On 24 August 2010 the Employer wrote to me requesting the matter be struck out. On 3 September 2010 I wrote to the Applicant regarding his failure to appear and requesting written advice by Friday 10 September as to whether he intended to proceed. I received email advice the following day advising that he did wish to proceed. The hearing ultimately did proceed on Friday 29 October 2010. The Applicant’s affidavit in this matter provides some further explanation for his non-appearance. 2

[6] The grounds for awarding costs under s.611(2)(a) relate to the time at which the application is made. Fair Work Australia (FWA) must be satisfied that the application was made vexatiously or without reasonable cause at the time of filing the application.

Section 611(2)(a) - application made vexatiously

[7] The employer provides two arguments to support its claim under s.611(2)(a) that the application was vexatious.

[8] Firstly, the employee should have known by 27 April 2010 that the requirements of s.394 regarding an extension of time would mean his delay would make the application so obviously untenable or manifestly groundless as to be utterly hopeless. 3 The Employer said the Applicant had independent legal advice on or before 27 April 2010.

[9] Secondly, the rejection of offers of settlement made by the Employer on 21 June and 23 June 2010 was indicative of a vexatious approach.

Section 611(2)(a) - application without reasonable cause

[10] The Employer relies on the claim that the Applicant should have been aware, on his own facts, that from 12 May 2010 the application would fail because of the operation of s.394, in addition to the matters set out in paragraphs [7] to [9] above.

Section 611(2)(b) - reasonably apparent that the application had no reasonable prospect of success

[11] This section is to be applied objectively rather than on the subjective view of the employee.

[12] The Employer referred to Walker v Mittagong Sands Pty Ltd T/A Cowra Quartz 4 where it was said that the expression ‘no reasonable prospects of success’ is a lower test than ‘without reasonable cause’ in s.611(2)(b).

[13] The Employer submits the two jurisdictional objections were present, the extension of time objection and the genuine redundancy objection.

[14] Regarding the extension of time, the application was 29 days out of time, and was filed 18 days after the applicant notified of his intention to commence legal proceedings. 5

[15] The Employer also submits the applicant ought to have known on or about 21 June 2010 that the application had no reasonable prospect of success after the Applicant had received and considered the Employer’s response to the application (including the extension of time objection), and a letter from the Employer’s solicitors advising that the employer would seek costs if the mater progressed to jurisdictional hearing or arbitration.

Consideration

Section 611(2)(a) - application vexatious or without reasonable cause

[16] The Employer made the submission that the Applicant had the opportunity of taking legal advice before the application was filed. 6 The evidence indicates that the character of these discussions was of the Applicant talking to a friend who happened to be a lawyer. This person was never appointed as a representative, never appeared before FWA and it would appear there was never a formal client solicitor relationship.7

[17] The Employer argues that on the basis of having received this advice the Applicant should have known by 27 April 2010 that gaining an extension of time was so obviously untenable or manifestly groundless as to be utterly hopeless. I reject that assertion. The evidence was the 14 day time limit had expired at the time he spoke to his friend who was a lawyer. There is no evidence he sought or obtained any advice on the time limits in the Act. It may well be the discussions with his friend were limited to the redundancy issue. The Applicant represented himself at both the substantive hearing and in this costs matter.

[18] Deciding whether FWA is satisfied exceptional circumstances exist in order to extend time takes into account six factors set out in s.394, and a decision to extend time on those grounds is discretionary. Whilst I ultimately did not accept the basis upon which the Applicant argued I should have extended time, I do not believe his application to extend time was obviously untenable or manifestly groundless as to be utterly hopeless. It was rejected on the basis that I did not believe there was an adequate explanation for the delay from 12 May to 1 June 2010. That was a period of 18 days taking into account the appropriate telling of time for that period. Because of the element of discretion attached to s.394 and examples of extension of time being granted for periods longer than 18 days by FWA, I do not accept that s.611(2)(a) is applicable on that basis.

[19] The Employer made the submission that the non-appearance of Mr Pagkaliwangan on 20 August 2010 in conjunction with the tone of his correspondence with regard to settlement and progression of the application might allow the Tribunal to come to the conclusion that he was possessed of an intent to embarrass his former employer, and he proceeded despite the application being hopeless.

[20] The Employer has argued an inference should be drawn from the reason given for his failure to appear on 20 August 2010 (that he forgot) to support its claim regarding s.611(2)(a). The Applicant provided some further reasons for his non-appearance on 20 August 2010 in his affidavit in this matter. 8

[21] I am not satisfied that Mr Pagkaliwangan was possessed of an intent to embarrass his former employer. I do not consider his failure to appear at the hearing on 20 August 2010, or his rejection of a settlement offer made, was indicative of his application being vexatious or without reasonable cause. It is my view having received his evidence in the substantive matter and at the costs hearing he genuinely believed his dismissal was unfair at the point of making the application and continues to do so.

[22] I have had regard to the correspondence he forwarded to the Employer on 27 April 2010 9 which sets out nine separate grounds which he argued support his claim that his termination was not a genuine redundancy. He received a response from the Employer’s solicitors dated 30 April 2010 which said among other things that the Employer’s solicitors were seeking further instructions in order to respond. There was ventilation of the issues concerning the redundancy at the substantive hearing. Ultimately it was not necessary for me to determine that jurisdictional objection as I decided against extending time. There were disputed facts regarding the redundancy. I do not accept that on the basis of the competing contentions of the parties, as at the time of filing the Applicant’s case regarding the redundancy was hopeless.

[23] No conciliation conference was ever held in this matter as the employer objected to a conciliation conference proceeding on the basis it wanted the jurisdictional objections to the application addressed first.

[24] I have had regard to the correspondence of 21 June and 23 June 2010 from Gadens Lawyers on behalf of the Employer. It appears clear to me that the offer of settlement made in that correspondence is less than what the employee was legally entitled to under clause 17 of the Siganto & Stacey Pty Ltd and AMWU On Site Construction Enterprise Agreement 2009-2011. This appears to be confirmed by Mr Hodgens during the substantive hearing. 10 I do not find the Applicant’s rejection of that offer as indicative of his being vexatious. On the basis of these views I reject the other grounds put by the Employer to argue s.611(2)(a) is applicable.

Section 611(2)(b) - reasonably apparent the application had no reasonable prospect of success

[25] The Employer relied upon an argument that the test at s.611(2)(b) is lower than the test at s.611(2)(a).

[26] In A Baker v Salva Resources Pty Ltd 11 the Full Bench said as follows regarding the operation of s.611(2)(b).

“[10] The concepts within s.611(2)(b) “should have been reasonably apparent” and “had no reasonable prospect of success” have been well traversed:

• “should have been reasonably apparent” must be objectively determined. It imports an objective test, directed to a belief formed on an objective basis, rather than a subjective test; and

• a conclusion that an application “had no reasonable prospect of success” should only be reached with extreme caution in circumstances where the application is manifestly untenable or groundless or so lacking in merit or substance as to be not reasonably arguable.”

[27] Again the Employer relies upon the two jurisdictional objections and the fact it says the Applicant received independent legal advice before filing the application on 1 June 2010. Further, the Employer said it should have been reasonably apparent to the Applicant that the application had no reasonable prospect of success after the Applicant had received and considered the Employer’s response to the application including the extension of time objection, and a letter from the employers solicitors advising the Employer would seek costs if the matter progressed to jurisdictional hearing or arbitration.

[28] In a case such as this where the Applicant is self represented and no conciliation conference took place I believe it is not realistic to expect that it should have been reasonably apparent to him that the application had no reasonable prospect of success.

[29] I also rely on the reasons I have given above for rejecting the claim that the application was vexatious or without reasonable cause, to also reject the Employer’s submissions regarding s.611(2)(b).

Conclusion

[30] On the basis of my findings above none of the preconditions necessary to the exercise of discretion have been satisfied in this application, and because of this, the discretion to award costs is not available to me.

[31] The application for costs is dismissed.

COMMISSIONER

Appearances:

Mr J.A Hodgens, Solicitor Gadens Lawyers for Siganto and Stacey Pty Limited.

Mr R Pagkaliwangan for himself.

Hearing details:

Brisbane

29 June 2011

 1   PR504370.

 2   Exhibit 8, Paragraph b.

 3   Exhibit 1, Paragraph 4.8.

 4   [2011] FWA 2225.

 5   Exhibit from hearing of substantive matter: Marked Exhibit 4 in Transcript 29 October 2010, Attachment 1.

 6   Transcript 29 October 2010, PN91-97.

 7   Transcript 29 June 2011, PN432-451.

 8   Exhibit 8, Paragraph b.

 9   Exhibit from hearing of substantive matter: Marked Exhibit 2 in Transcript 29 October 2010, Attachment “RCP 3”.

 10   Transcript 29 October 2010, PN279-289.

 11   [2011] FWAFB 4014.

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