Mr Trent Geissler v QR Passenger Pty Ltd

[2010] FWA 1939

[2010] FWA 1939

FAIR WORK AUSTRALIA

DECISION

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

Mr Trent Geissler
v
QR Passenger Pty Ltd
(U2009/13025)

COMMISSIONER SPENCER BRISBANE, 13 OCTOBER 2010

Termination of employment - Costs application.

Introduction

[1] This determination relates to a costs application made by QR Passenger Pty Ltd (the Costs Applicant) against both Mr Trent Geissler (the Applicant/first Costs Respondent) and the Australian Municipal, Administrative, Clerical and Services Union (the ASU/the second Costs Respondent) pursuant to s.611(2)(b) of the Fair Work Act 2009 (Cth) (the Act).

[2] The Costs Applicant sought an order that the Costs Respondents pay their total or partial costs in relation to the first Costs Respondent’s application for an unfair dismissal remedy.

[3] The unfair dismissal application was listed for arbitration for five days. The first Costs Respondent was represented by Mr J Merrell, of Counsel, instructed by the ASU. The Costs Applicant was represented by Mr T Bradley, of Counsel, instructed by QR Passenger Pty Ltd.

[4] The first day of arbitration concluded with the first Costs Respondent’s evidentiary case being part heard, in that the Applicant’s evidence-in-chief and part of his cross-examination had been undertaken. However, at the commencement of the second day of arbitration, an adjournment was requested by the Costs Respondents, which was granted. A Notice of Discontinuance was provided later that day, and indicated that the unfair dismissal application was withdrawn, and not as part of a settlement agreement.

[5] The Costs Applicant then made an application for costs, within 14 days of receiving the Notice of Discontinuance. Directions were issued for the filing of material. Submissions were filed by the Costs Applicant applicable to both first and second Costs Respondents; however the first and second Costs Respondents made separate submissions in response. The parties agreed to have the matter heard on the papers.

[6] In relation to the costs application, Mr Merrell continued to represent both Costs Respondents; however Ms Kerrie Pereira of QR Passenger Pty Ltd prepared the material on behalf of the Costs Applicant.

[7] Although not all of the material provided has been referred to in this determination, all of such has been considered.

Relevant legislation

[8] In accordance with s.611 of the Act, Fair Work Australia (FWA) is able to order costs against a person. The Costs Applicant relied upon s.611(2)(b) in its application, thereby seeking to satisfy FWA that the Costs Respondents should have been aware that the unfair dismissal application had no reasonable prospect of success. Section 611 is extracted 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:

...

(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.

...

Background

[9] The Costs Applicant set out the chronology of events in relation to the unfair dismissal application, and the Costs Respondents have not disputed this.

[10] The subject of the unfair dismissal application concerned the first Costs Respondent allegedly inappropriately dealing with a member of the public in breach of his responsibilities in relation to the Costs Applicant’s Code of Conduct. The Costs Applicant conducted an investigation into the allegations and concluded they were substantiated. A Show Cause Notice was issued and the Costs Applicant received a response from the first Costs Respondent.

[11] On 5 October 2009, the Costs Applicant terminated the first Costs Respondent’s employment on the ground of serious breach of Code of Conduct and the Transit Officer’s Standard Operating Procedures Manual. On 16 October 2009, the first Costs Respondent filed an unfair dismissal remedy application in FWA.

[12] On 6 November 2009, the parties attended a Fair Work Conciliation, which did not resolve the matter. On 1 December 2009, at the Directions hearing, the Costs Applicant was informed that the first Costs Respondent would be represented by Counsel at the scheduled arbitration.

[13] The matter was then listed for five days of arbitration before FWA as presently constituted, and Directions were issued in relation to the filing of material, including the relevant Closed Circuit Television (CCTV) footage, witness statements and written submissions.

[14] On 8 December 2009, the Costs Applicant provided the full CCTV footage of the incident involving the Applicant to the Costs Respondents.

[15] The Costs Applicant then retained counsel to prepare the material and appear at the hearing. The date this occurred was not provided.

[16] In the December 2009 issue of the ASU’s Journal, The Leader, an article entitled ‘Trent Geissler - QR punish the wrong man’ was published in relation to the unfair dismissal application. Relevantly, the article provided:

“The ASU is absolutely determined that this gross miscarriage of justice and the misapplication of policy does not go unchallenged. The ASU has already filed an application with FWA seeking Mr Geissler’s reinstatement to his former position. That application has been opposed by QR presumably on the basis that it can’t be seen publicly as making a complete fool of itself. QR are now trying to defend the indefensible.

The ASU will not allow this matter to rest and will pursue it vigorously on our member’s behalf. Trent will receive the support of the union and we will make sure that the issue is fully tested on all fronts...” 1

[17] In accordance with the Directions issued in relation to the unfair dismissal application, the Costs Respondent filed its submissions and material on 29 January 2010 and the Costs Applicant filed its written submissions and material on 26 February 2010.

[18] On 8 March 2010, the ASU published in aSun Rail News that the application was being heard, that the ASU supported the first Costs Respondent and invited other members to attend the public hearing.

[19] On the first day of the arbitration (Monday 8 March 2010), the first Costs Respondent provided evidence and the Costs Applicant commenced their cross-examination. As mentioned previously, the second day of arbitration commenced with an adjournment, requested by the Costs Respondents, and the second Costs Respondent advised the matter was finalised by the filing of the Notice of Discontinuance on that day.

[20] Following the hearing, on 10 March 2010, the ASU published an additional newsletter with an article entitled ‘Trent Geissler - Report back to members’. Relevantly, it states:

“Unfortunately during the cross examination of Mr. Geissler it became apparent that there were some credibility gaps between the evidence of Mr. Geissler and documentation which QR produced to discredit Mr Geissler’s account. As such, the union’s barrister informed both Mr. Geissler and the union that there was little prospect of the application being pursued to a successful conclusion

...

What have we learned from this exercise?

...despite the wide public approval that was generated for Mr. Geissler’s actions it did not translate into evidence that ultimately supported Mr. Geissler’s case. QR management had examined the CCTV footage of the incident and found that Mr. Geissler had not reacted in keeping with his training or the QR policies. The union on the other hand had responded to its member’s appeal for help and had accepted the member’s version as being true and correct...

Mr. Geissler, on the evidence presented, appears to have stepped over the bounds that were expected of him. It does not matter however well intentioned his actions were. They breached QR policy. Subsequently the media were involved against our advice and Mr Geissler got his 15 minutes of fame. It also poisoned the water for settling the matter in an equitable manner. The union does not back away from defending Mr. Geissler. It will do the same for any member faced with the same situation. All the union asks is that we are given all of the facts at the time and that members’ act on the advice we provided to them.”

Submissions of the Costs Applicant

[21] The Costs Applicant submitted that the ASU had conceded the matter had no reasonable prospect of success in its 10 March 2010 newsletter article, specifically via the admission that the CCTV footage was not supportive of his case. They submitted that the newsletter refers to ‘some credibility gaps between the evidence of Mr. Geissler and documentation which QR produced’ which ‘became apparent during cross-examination’. The Costs Applicant argued that that the first and second Costs Respondents were well aware of the evidence that the Costs Applicant had sought to rely on in relation to the unfair dismissal application.

[22] The Costs Applicant relied on the CCTV footage as providing ‘a substantial evidentiary base’; and that the footage had been identified, referred to and disclosed prior to the arbitration proceedings with the Costs Respondents. The Costs Applicant emphasised that the footage was shown to the Costs Respondents during the Investigation in June 2009; that it was provided in full to the Costs Respondents in December 2009; and it was set out in their submissions provided in February 2010.

[23] It was submitted that as a result of this ‘substantial evidentiary base’, the Costs Respondents should have formed the view that they had no reasonable prospects of success, and that they had various opportunities to form that view prior to the arbitration.

[24] The Costs Applicant submitted that due to the Costs Respondents’ decision to pursue the application it had incurred costs as a result of the necessity to defend the claim.

[25] The Costs Applicant outlined that it had incurred the cost of retaining ounsel to further prepare for and appear at the scheduled five day hearing.

[26] In addition the Costs Applicant stated costs were incurred to obtain expert evidence from both Mr Bill Turner, who provided training to the first Costs Respondent and Dr Jill Reddan, a psychiatrist. Dr Reddan was retained to provide a view in relation to the first Costs Respondent’s assertion that he was suffering from post-traumatic stress disorder, which may have affected his state of mind on 12 April 2009, the day of the incident.

[27] The Costs Applicant sought for these costs to be recovered; or at least the recovery of the costs incurred after 8 December 2009 (which is the date that the full CCTV footage was provided to the Costs Respondents).

[28] The actual costs incurred by the Costs Applicant were not set out.

Submissions of first Costs Respondent

[29] It was submitted on behalf of the first Costs Respondent that the test of ‘manifestly untenable or groundless’ (in determining ‘no reasonable prospect of success’) is a difficult test to satisfy, especially in relation to cases which are not clear cut. It was submitted that as the unfair dismissal application attracted the jurisdiction of FWA, it was not a clear cut case on which to determine its prospects of success.

[30] It was further submitted that great caution should be exercised in coming to a conclusion, that it should have been reasonably apparent to an applicant, that their application had no reasonable prospect of success. This is particularly so where the facts of the case have not been tested in a hearing.

[31] Furthermore, it was submitted that the assessment of case prospects for applicants may be difficult as there is no longer a certification process as was the case pursuant to s.170CF(3) and (4) of the pre-reform Workplace Relations Act 1996 (the pre-reform Act), and s.650 of the Workplace Relations Act 1996 (the WR Act), which provided some guidance to applicants in relation to the prospects of their case.

[32] The first Costs Respondent also submitted that at the time of making the unfair dismissal application on 16 October 2009, the facts of the case were in controversy, and that the circumstances of the incident that led to the termination of employment were not as persuasive as the Costs Applicant submitted. And furthermore, that there were other circumstances which may have mitigated the severity of the incident. It was his view that ‘an argument was clearly tenable’. It was submitted that at the time of making the application that it was not apparent to the Costs Respondents that the application was manifestly untenable or groundless, as follows:

“In the Applicant’s case, the following matters were apparent to the Applicant at the time he made his application on 16 October 2009:

(a) the Applicant had to have been employed by the Respondent for a period of approximately 2 years;

(b) the member of the public with whom the Applicant had altercation on Northgate Railway Station on 12 April 2009 had been arrested by the Police, had been charged with assault, had pleaded guilty and had been ordered to complete community service;

(c) no complaint had ever been received from a member or members of the public about the Applicant’s conduct on 12 April 2009; and

(d) there was a clear argument raised in the application, namely that the Respondent did not give due consideration to the full circumstances in terminating the Applicant’s employment where there was an opportunity for education, retraining and mentoring, as well as other forms of discipline open to the Respondent in addressing its concerns other than the Applicant’s dismissal.” 2

[33] It was submitted that the evidence was not fully tested by FWA, and no determination was made by FWA. They further submitted that even if FWA had found a valid reason for dismissal, it was open to FWA to determine that the dismissal was still unfair. On this basis, it was submitted that the application was manifestly tenable. The relevant test is not whether the application would have ultimately been successful but rather whether there were reasonable prospects of success.

[34] It was submitted that the correct interpretation of the 8 March 2010 newsletter was a confirmation that there were potentially alternative courses of action available to the Costs Applicant, thus affirming that the case was ‘manifestly tenable’.

[35] It was further submitted that it was open to the Costs Applicant to make an application to FWA to dismiss the application pursuant to s.587(3)(b) of the Act on the grounds that the application had no reasonable prospects of success. The Costs Respondents submitted that failure to make that application was inconsistent with their assertion that the application had no reasonable prospects of success.

[36] Further, it was submitted that the first Costs Respondent was acting upon legal advice to discontinue his proceedings; and on that basis he acted reasonably in discontinuing the proceedings. It was also submitted that this advice was received after the first day of hearing, 8 March 2010 and thus it could not have been a matter which was reasonably apparent to the first Costs Respondent at the time of making the application, some four and a half months earlier.

Submissions of second Costs Respondents

[37] The second Costs Respondent submitted that no costs can be ordered against it on the grounds of s.611(2)(b), as it was not the applicant in the proceedings. It was submitted that s.611(2)(b) applies to a person making an application (or response), and that because the second Costs Respondent was the first Costs Respondent’s representative, it was not open to it to withdraw the application, whether it thought the matter had no prospects of success or not. It was submitted that the second Costs Respondent did have a choice to cease representation, but this is not relevant in relation to s.611(2)(b), as the provision applies to an applicant only.

[38] The second Costs Respondent also recognised that other costs orders can be made under the Act in relation to lawyers or paid agents, and in particular s.401 provides for such in relation to unfair dismissal applications. However, it was submitted that such costs orders could not be competently made against the ASU as the application was not made pursuant to s.402 (as is required by s.401(2) of the Act), and in any event, the second Costs Respondent was neither a lawyer nor a paid agent (as defined in s.12 of the Act), as required in the provision.

[39] The second Costs Respondent also set out alternative submissions in the event that FWA considered that s.611(2)(b) could have applied to it. The submissions were in similar terms as those submitted by the first Costs Respondent that is, that the test of the application being without ‘reasonable prospects of success’ has not been made out.

Relevant Authorities

[40] The Explanatory Memorandum in relation to s.611 of the Act sets out as follows:

2353. Subclause 611(1) provides that generally a person must bear their own costs in relation to a matter before FWA.

2354. However, subclause 611(2) provides an exception to this general rule in certain limited circumstances. FWA may order a person to bear some or all of the costs of another person where FWA is satisfied that the person made an application vexatiously or without reasonable cause or the application or response to an application had no reasonable prospects of success. [emphasis added]

[41] The Costs Applicant in this matter submitted the unfair dismissal application had no reasonable prospects of success.

[42] The Full Bench of the Australian Industrial Relations Commission (AIRC) in Hi Security Fencing Pty Ltd v Forsyth 3considered the question of whether a costs order ought to be made, inter alia, pursuant to s. 658(1) of the Workplace Relations Act 1996 (Cth) (the WR Act). Section 658(1) provided (in similar terms to s.611) that

“(1) if the Commission is satisfied:

(a) that a person (first party):

(i) made an application under section 643; or

(ii) began proceedings relating to an application; and

(b) the first party did so in circumstances where it should have been reasonably apparent to the applicant that he or she had no reasonable prospects of success in relation to the application or proceeding;.

the Commission may, on application, under this section by the other party to the application or proceeding, make an order for costs against the third party.”

[43] The Full Bench in Forsyth adopted the test as set out in Deane v Paper Australia Pty Ltd 4(which was a decision in relation to s.170CJ(1) of the pre-reform Act). They stated:

“The approach to the statutory term “where it should have been reasonably apparent to the party that he or she had no reasonable prospect of success” within s.658(1) of the Act is for the Commission to determine whether:

“upon the facts apparent to the applicant at the time of instituting the appeal, the proceeding in question was manifestly untenable or groundless, the relevant requirement in s.170CJ is not fulfilled and the discretion to make an order for costs is not available.”” [emphasis added]

[44] Although both decisions were decided under different legislation, the wording of the WR Act and the pre-reform Act is similar to the wording of s.611(2)(b) of the current Act. Accordingly, this case law is relevant authority and thus the relevant test is whether the Costs Respondent, at the time of making the unfair dismissal application, with all the information before it, knew, or ought to have known that the proceeding was ‘manifestly untenable or groundless’. It is on this basis that, FWA has discretion to determine whether an order for costs is justified.

[45] Further it was submitted on behalf of the Costs Respondents that the first Costs Respondent’s case was not a clear cut jurisdictional matter as the matter of Forsyth was.

Consideration

The first Costs Respondent

[46] Section 611(2)(b) requires that it be ‘reasonably apparent’ to an applicant that their application had ‘no reasonable prospects of success’ before FWA can order costs. The Explanatory Memorandum clearly specifies that costs applications will only be granted in ‘limited’ circumstances; if the application had no reasonable prospects of success.

[47] This unfair dismissal application did not present as a clear cut case; as a jurisdictional objection that could have made the application ‘manifestly untenable or groundless’ was not present. There was significant material produced in relation to arguing and defending the unfair dismissal application, and both parties retained counsel for that purpose.

[48] Further the Costs Applicants predominant argument was that the provision of the CCTV footage should have triggered a withdrawal of the case by the Costs Respondents. It was submitted that by viewing this footage at the early stages prior to the hearing it should have been ‘reasonably apparent’ that their application had no reasonable prospects of success. Reciprocally, on this basis at this early stage (as argued by the Costs Respondents) it was open to the Costs Applicant to make an application pursuant to s.587 to have the application dismissed on the grounds that it had no reasonable prospects of success, but they did not take this action.

[49] In Darcy v Megan Fitzgerald & Associates Pty Ltd, 5Whelan C dismissed an application for costs in relation to s.611(2)(b), that is, whether the case had a reasonable prospect of success. She said:

“We are dealing in this case with new legislation the parameters of which have not been tested by the Courts...

In my view, great care should be exercised in coming to a conclusion that a party either instituted proceedings ‘without reasonable cause’ or in circumstances where it should have been reasonably apparent that the application had ‘no reasonable prospect of success’ where the facts of the case and the applicable law have not been tested in a hearing.” 6

[50] On the basis of Whelan C’s reasoning, similar caution should be taken in exercising the discretion to order costs in this current application where the evidence was not properly tested before FWA. It is the Costs Applicant’s contention, in essence, that the CCTV footage provided incontrovertible evidence of the first Costs Respondent’s breach of the required conduct in relation to the incident that led to his dismissal.

[51] However, the Costs Respondents submitted that such a finding alone would not have made the application untenable. It was submitted that relevant argument would have followed regarding other options that were available to the Costs Applicant other than dismissal, such as education, retaining and mentoring, and as such, the reliance on the existence of CCTV footage does not make the unfair dismissal application without prospects. It was submitted that even if there was a valid reason for the dismissal, it does not mean that the dismissal was not harsh, unjust or unreasonable. Accordingly a consideration of the merits of the unfair dismissal application simply against the evidence on CCTV footage may not have automatically presented the case as being without reasonable prospects of success. A further assessment was required as to whether the dismissal in the circumstances was warranted.

[52] Furthermore, the decision to withdraw the application was only made at the time when statements had been filed and an amount of cross-examination had occurred and it was then that the assessment became clearer.

[53] The Costs Applicant relied on the ASU newsletter article of 10 March 2010 as being indicative that the second Costs Respondent should have been on notice from a time prior to the hearing that the prospects of success were not reasonable. Again the article specifies that it was during the cross-examination (rather than an assessment at the time of making the application or viewing the CCTV footage) that the ‘credibility gaps’ with the Applicant’s evidence emerged. It was immediately after this that Counsel for the Costs Respondent advised that the application would be withdrawn. It cannot be considered that, as per the test set out in Deane, the first Costs Respondent had a ‘manifestly untenable or groundless’ case on the basis of the article. The article was written after the fact, and served to provide a warning to future members that full disclosure is required in order for the ASU to confidently defend their claims.

[54] However, it is of significant concern if the Applicant has brought about the application (and caused costs to be incurred) on the basis of conveying false evidence to his Union and then this Tribunal. It is incumbent upon an industrial organisation to vet the material that is provided to them in the process of initiating or defending a case. In the current circumstances the cross-examination did not advance to questioning on the CCTV footage. It was known to the parties that the copies of the footage provided to the Tribunal could not be viewed with any clarity on the equipment available (the Costs Applicant had set up appropriate equipment for the proper viewing of the footage at the hearing). Therefore a clear determination of the merits of the matter regarding a comparison between the first Costs Respondent’s evidence and the footage could not be made by the Tribunal.

[55] The clear intention of the Act is that costs orders only be provided in limited circumstances and in the current matter the legislative tests have not been met.

The second Costs Respondent

[56] It is recognised that the second Costs Respondent is a registered employee organisation under the Act, and that it was on a representational basis that they were involved in the unfair dismissal application.

[57] Having considered the submissions of the second costs Respondent, s.611(2)(b) cannot apply to the ASU, as they were not the applicant in the unfair dismissal application nor do they meet the definition of lawyers or paid agents. Section 611(2) clearly states where FWA is satisfied that it was apparent to the person who made the application that the application had no reasonable prospects of success, then FWA can exercise the discretion in relation to ordering costs but should do so with caution and in limited circumstances. The first Costs Respondent was the Applicant in the unfair dismissal matter, not the ASU.

[58] It follows that the Costs Applicant may have been mistaken in making the costs application on the ground of s.611(2)(b) in relation to the second Costs Respondent. The other grounds of costs applications are found in s.376, s.402 and s.780 which are relevant for costs orders against lawyers and paid agents. Section 402 is the applicable section to make an application for costs in relation to an unfair dismissal application against a lawyer or paid agent.

[59] The Explanatory Memorandum to the Fair Work Bill 2008, in relation to s.401 states:

1613. Subclause 401(2) provides that, in order for FWA to make a costs order against a lawyer or paid agent, an application by the person seeking the costs needs to have been made under clause 402.

[60] The Costs Applicant’s application was not made pursuant to s.402, which is mandatory for a costs order in relation to s.401(2) against a lawyer or paid agent. On this basis, the costs application must be dismissed against the second Costs Respondent (that is, against the ASU or their Counsel as there is no applicable application). The decision of Deegan C in Anita Khiani v Australian Bureau of Statistics 7 is relied on. In similar circumstances Deegan C dismissed a costs application made incorrectly pursuant to s.376 of the Act because the applicant in that matter was pursuing costs against the Respondent, and not the Respondent’s representative. The relevant application was not made to pursue costs against the ASU or their lawyer.

Conclusion

[61] For the aforementioned reasons, the Costs Application must be dismissed against both the first and second Costs Respondents. I Order accordingly.

COMMISSIONER

 1   The Costs Applicant referred to this newsletter in its submissions in relation to the costs application. It was not provided to FWA strictly in relation to the costs application; however it was provided as part of the unfair dismissal application.

 2   Submissions of the first Costs Respondent paragraph 39.

 3   Watson SDP, Hamilton DP and Simmonds C [2007] AIRCFB 846.

 4   Giudice J, Williams SDP, Simmonds C PR932454.

 5   [2009] FWA 1547.

 6   Ibid at [27] and [28].

 7   [2010] FWA 375.

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