Pettit v Evolution Mining Ltd

Case [2016] FCA 1304

FEDERAL COURT OF AUSTRALIA

Pettit v Evolution Mining Ltd [2016] FCA 1304

File number: WAD 554 of 2015
Judge: BARKER J
Date of judgment: 3 November 2016
Catchwords: COSTS – application for costs under s 570 of the Fair Work Act 2009 (Cth) – whether party instituted proceedings vexatiously or without reasonable cause – whether party’s unreasonable act caused other party to incur costs
Legislation:

Fair Work Act 2009 (Cth) ss 35(1), 351, 539, 570, 570(2), 570(2)(a), 570(2)(b)

Federal Court of Australia Act 1976 (Cth) s 43

Workplace Relations Act 1996 (Cth) s 824
Cases cited:

Ashby v Slipper (No 2) (2014) 144 ALD 10; [2014] FCAFC 67

Australian Workers’ Union v Leighton Contractors Pty Ltd and Others (No 2) (2013) 232 FCR 428; [2013] FCAFC 23

Construction, Forestry, Mining and Energy Union and Others v Clarke (2008) 170 FCR 574; [2008] FCAFC 143

Construction, Forestry, Mining and Energy Union v Corinthian Industries (Australia) Pty Ltd (No 2) [2014] FCA 351

Council of Kangan Batman Institute of Technology and Further Education v Australian Industrial Relations Commission and Another (2006) 156 FCR 275; [2006] FCAFC 199

Hobson v BWL Pty Ltd & Ors (No. 5) [2013] FCCA 2145

R v Moore and Others; ex parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470; [1978] HCA 51

Tsilibakis v Transfield Services (Australia) Pty Ltd (No 2) [2015] FCA 1048
Date of hearing: Determined on the papers
Registry: Western Australia
Division: Fair Work Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 65
Counsel for the Applicant: Dr C Edwards
Solicitor for the Applicant: Delta Legal
Counsel for the Respondent: Ms J Hart
Solicitor for the Respondent: HopgoodGanim Lawyers

ORDERS

WAD 554 of 2015
BETWEEN:

PHIL PETTIT

Applicant
AND:

EVOLUTION MINING LTD

Respondent

JUDGE:

BARKER J

DATE OF ORDER:

3 NOVEMBER 2016

THE COURT ORDERS THAT:

1.The applicant do pay the costs of the respondent incurred after 29 January 2016, to be taxed, if not agreed, including the preparation of the submissions in relation to this costs question.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

BARKER J:

  1. On 20 May 2016, I made consent orders withdrawing the originating application in this proceeding, which sought remedies for breach of contract and contravention of s 351 of the Fair Work Act 2009 (Cth) in relation to the respondent’s termination of the applicant’s employment on 11 July 2015.

  2. In doing so, I ordered that the issue of costs be determined on the papers following the filing of parties’ submissions in this regard.

  3. The Court’s general discretion with respect to costs pursuant to s 43 of the Federal Court of Australia Act 1976 (Cth) is subject, in the circumstances of this proceeding, to s 570 of the Act, which provides as follows:

    (1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a…

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AGLC
Pettit v Evolution Mining Ltd [2016] FCA 1304
Case
[2016] FCA 1304
Decision Date

CaseChat Overview and Summary

Pettit v Evolution Mining Ltd involved a dispute between the applicant, Pettit, and the respondent, Evolution Mining Ltd, under the Fair Work Act 2009 (Cth). Pettit alleged that he was unfairly dismissed due to an illness or disability, and sought compensation, damages, and costs. The proceeding was referred to mediation, which was unsuccessful, and subsequently, Pettit sought to transfer the case to the Federal Circuit Court of Australia. Despite orders for filing witness statements, Pettit did not comply and instead notified the Court of his intention to withdraw his application. Evolution Mining Ltd responded by seeking costs incurred post-mediation, arguing that Pettit's conduct was unreasonable and caused them to incur costs.

The court considered whether the proceeding was instituted vexatiously or without reasonable cause and whether Pettit’s actions caused Evolution Mining Ltd to incur costs. Under s 570 of the Act, costs are to be awarded sparingly, only in exceptional circumstances. The court found that while the initial proceeding was not doomed, Pettit’s subsequent conduct, including his failure to comply with programming orders and his attempt to withdraw the application without proper notice, constituted an unreasonable act that led to additional costs for Evolution Mining Ltd. Therefore, the court held that Pettit's entire course of conduct post-mediation was unreasonable.

In conclusion, the court ordered that Pettit pay the costs incurred by Evolution Mining Ltd after the failed mediation on 29 January 2016, including the preparation of submissions related to the costs question. The order was made to reflect the court's finding that Pettit's actions were unreasonable and led to additional expenses for the respondent.

Orders

Orders of the court

1. The applicant do pay the costs of the respondent incurred after 29 January 2016, to be taxed, if not agreed, including the preparation of the submissions in relation to this costs question.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

For the reasons that follow, I consider that, in the circumstances of this case, the applicant should pay the costs of the respondent incurred after the proceeding was not resolved at the mediation on 29 January 2016, including the preparation of the submissions in relation to this costs question.FACTUAL BACKGROUND On 22 September 2015, the applicant commenced this proceeding by filing an originating application alleging, amongst other things, that the respondent contravened s 35(1) of the Act by terminating the applicant’s employment because of an illness or disability, or a perceived illness or disability. The applicant sought compensation of 60 penalty units as provided for in s 539 of the Act, damages for breach of the applicant’s employment contract, and costs. On 3 November 2015, the applicant filed and served his statement of claim in which he sought “payment of any part of the notice period unpaid” together with interest, in addition to the relief claimed in the originating application. On 6 November 2015, I made orders for the filing of pleadings and referred the proceeding to mediation before a Registrar of the Court. Pursuant to these orders, the respondent filed its defence on 30 November 2015 and the applicant filed its reply on 14 December 2015. The proceeding did not resolve at the mediation conducted on 29 January 2016. On 9 February 2016, the solicitor on record for the applicant, Delta Legal, sent an email to the solicitor on record for the respondent, Hopgood Ganim, suggesting that the proceeding be transferred to the Federal Circuit Court of Australia. On 11 February 2016, the respondent’s solicitors responded by stating, amongst other things, that:The general protections claim, if there is one, should be evidenced, before we can, or the Court can, conclude that this is a matter appropriate for the Federal Circuit Court or any other Court, State or Federal. On 24 February 2016, I made orders by the parties’ consent relevantly requiring the applicant to file witness statements containing all the evidence on which he intended to rely by 17 March 2016. The time for filing was extended to 31 March 2016 by orders made by the parties’ consent on 18 March 2016. The applicant did not file, or apparently serve, any witness statements in accordance with these orders. On 4 April 2016, the Court sent an email to the parties’ solicitors noting that the applicant had not filed any witness statement(s) and requiring compliance with its order of 18 March 2016. On that same day, the applicant’s solicitors sent an email to the Court and the respondent’s solicitors advising that the applicant intended to withdraw its originating application. The respondent says it had no prior notice of the applicant’s intention to withdraw the application. On 18 May 2016, the respondent’s solicitors sent an email to the applicant’s solicitors notifying them of the respondent’s intention to seek costs, and its reasons for doing so. The applicant’s solicitors replied on the same day stating the applicant’s intention to “vigorously oppose” any application for costs and his reasons for doing so.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

He says that by pressing for this hearing on the papers, the respondent has forced the applicant to go to considerable expense to defend against the threat of a substantial costs penalty. In doing so, the applicant submits that the respondent’s conduct undermines the protection afforded by s 570(2) by putting future applicants in cases of this type on notice that a respondent may effectively penalise them for the conduct of their case, even if they conduct their case in a reasonable manner. CONSIDERATION The principles governing an award of costs under s 570 of the Act are well established. The Full Court of this Court has repeatedly held that s 570, and its predecessor s 824 of the Workplace Relations Act 1996 (Cth), are to be understood as reflecting a legislative policy of protecting parties to proceedings under the Act from costs orders so that a party with a genuine grievance will not be discouraged from pursuing a remedy to which they may be entitled, or from pursuing litigation in the manner which they deem best, for fear of an adverse costs order. See Tsilibakis at [7], citing Clarke at [29] and Ashby at [35]. Consequently, it is usually only in exceptional circumstances that costs will be awarded under s 570. See Kangan at [60]. In all the circumstances, I am not prepared to conclude that the proceeding, when instituted, was doomed. However, I consider that from the time when the mediation conducted on 29 January 2016 failed to achieve a resolution of the matters in dispute, and the applicant then sought to transfer the proceeding to the Federal Circuit Court of Australia and subsequently failed to file and serve any witness statements in this proceeding in accordance with programming orders made and ultimately gave notice of his intention to withdraw his originating application in this Court, the applicant’s whole course of conduct should be considered an unreasonable act that caused the respondent to incur costs. In these circumstances, I would order that the applicant pay the costs of the respondent incurred after 29 January 2016, to be taxed, if not agreed, including the preparation of the submissions in relation to this costs question.ORDER The Court orders:(1)The applicant do pay the costs of the respondent incurred after 29 January 2016, to be taxed, if not agreed, including the preparation of the submissions in relation to this costs question.