Pilkington v Marninwarntikura Fitzroy Women's Resource Centre
[2023] FedCFamC2G 316
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
Pilkington v Marninwarntikura Fitzroy Women's Resource Centre [2023] FedCFamC2G 316
File number(s):
SYG 1929 of 2022
Judgment of: JUDGE CAMERON Date of judgment: 12 April 2023 Catchwords: PRACTICE AND PROCEDURE – COSTS – Fair Work Act 2009 (Cth) – application for costs following a notice of discontinuance – proceedings were not vexatious or brought without reasonable cause – respondent’s solicitor’s conduct was unreasonable –application for costs dismissed – order that the respondent pay applicant’s costs of the costs application. Legislation: Fair Work Act 2009 (Cth) s 570
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) r 22.06
Division: Fair Work Number of paragraphs: 23 Date of hearing: 12 April 2023 Place: Sydney Solicitors for the Applicant/ Cross-respondent: Gorval Lynch Solicitors for the Respondent/ Cross-claimant: NB Employment Lawyers ORDERS
SYG 1929 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: CHERYL ANITA PILKINGTON
Applicant
Cross-respondentAND: MARNINWARNTIKURA FITZROY WOMEN'S RESOURCE CENTRE (ABORIGINAL CORPORATION) (ABN 78 560 614 562)
Respondent
Cross-claimant
order made by:
JUDGE CAMERON
DATE OF ORDER:
12 April 2023
THE COURT ORDERS THAT:
1.The respondent’s application for costs be dismissed.
2.The respondent pay the applicant’s costs of and incidental to the application for costs fixed in the amount of $3,977.25.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE CAMERON
INTRODUCTION
The applicant, Ms Pilkington, brought this proceeding on 21 December 2022 alleging adverse action and the respondent, Marninwarntikura Fitzroy Women's Resource Centre (“MFWRC”), contended that it deserved to be dismissed for want of reasonable prospects of success. The proceeding was discontinued in its very early stages, as the chronology that I will rehearse later in these reasons makes clear, and the successful respondent has now sought an order for its costs.
LEGISLATION
The legislation relevant to the present application for costs is s.570 of the Fair Work Act 2009 (Cth) (“FW Act”) which provides:
570 Costs only if proceedings instituted vexatiously etc.
(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A.
(2)The party may be ordered to pay the costs only if:
(a)the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or
(b)the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs; or
(c)the court is satisfied of both of the following:
(i)the party unreasonably refused to participate in a matter before the FWC;
(ii)the matter arose from the same facts as the proceedings.
BACKGROUND FACTS
The background to today's application and to the determination of the proceeding by discontinuance is set out in the various affidavits which the parties have read today. In order to understand what happened, it is useful to refer to various aspects of the parties’ correspondence introduced into evidence by means of those affidavits.
Events following the initiating application
Having been served with the initiating application, MFWRC’s solicitors wrote to Ms Pilkington’s solicitors on 10 January 2023. Commencing perhaps in an unfortunate way, the second paragraph of their letter says:
While it is not our intention to embarrass, sometimes it is unavoidable. We have had regard to the application filed in the Federal Circuit and Family Court of Australia (Application) and are compelled, by function of the Australian Solicitors Conduct Rules 2012 (ASCR), rule 3, to write in respect of the contents of the application and put your client on notice as to its deficiencies.
In the circumstances, we are obliged to conduct litigation expeditiously and in a manner which ensures the proper administration of justice. On this basis, should your client not take heed of this correspondence, we may commence court applications with no further notice to you.
That letter went on to make complaints about the nature of the pleading set out in the initiating application. After having made those various complaints, MFWRC’s solicitors’ letter continued:
In light of the above, and noting the application provides a first return date of 3 February 2023, we provide until 23 January 2023 to (significantly) amend the application. Failing this, we will seek our client’s instructions to lodge an Application for Summary Disposal.
On 20 January 2023 Ms Pilkington’s solicitors wrote to MFWRC’s solicitors, suggesting that a way around the difficulties would be the filing of a statement of claim. They proposed the following orders:
1. The First Court Date listed for 3 February 2023 be vacated.
2. The Respondent file a Response to the Applicant’s Application by 3 February 2023;
3. The Applicant file and serve a Statement of Claim by 4.00pm on 3 March 2023.
4. The Respondent file and serve a Defence by 4.00pm on 3 April 2023.
In proposing that timetable, Ms Pilkington’s solicitors said:
While we understand your client requests that an amended application be filed or “cured”, our client will not be doing that. Rather, we propose and suggest that a timetable be set for the filing of pleadings rather than amending the initiating Application or responding to your correspondence in detail, thus taking up time and not keeping with the Court’s values with respect to the administration of justice. We trust that the filing of pleadings will alleviate your client’s concerns and be responsive to the requests.
That letter was followed up on 25 January 2023 by a telephone call and email from Ms Aziz, a solicitor in the employ of the solicitors for Ms Pilkington. In her email, Ms Aziz states:
During our telephone call today, I asked whether your client agreed to the orders which we proposed on behalf of the Applicant on 20 January 2023. The proposed orders included the filing of pleadings and vacating the First Court Date. We understand that your client has instructed that an Application for Summary Disposal be filed today and that the Applicant’s proposed orders are not agreed to. No reason was provided for this position.
We note you have not written to us about your position prior to us contacting you today. You also have not written to us responding to our correspondence dated 20 January 2023. Your client has instructed that an Application for Summary Disposal be filed without first liaising with our client or a courtesy of a our [sic] response being provided to our letter dated 20 January 2023. ...
On 27 January 2023 MFWRC’s solicitors filed and served the foreshadowed application for summary dismissal and also forwarded to Ms Pilkington’s solicitors a proposed consent order in respect of the approaching first court date on 3 February 2023. On 1 February 2023 Ms Pilkington’s solicitors sent to MFWRC’s solicitors an alternative proposed consent order. Then the parties fell into dispute over whether the correspondence attracted settlement negotiation privilege and the respondents threatened to seek indemnity costs of the first court date.
On 3 February 2023 the Court ordered Ms Pilkington to file a statement of claim by 24 February 2023.
On 22 February 2023 Ms Pilkington filed a notice of discontinuance.
Events following the notice of discontinuance
On 2 March 2023 MFWRC’s solicitors wrote to Ms Pilkington’s solicitors seeking costs of the proceeding on the basis that Ms Pilkington’s actions had been unreasonable. They set a deadline of 8 March 2023 at 9am for a response to that correspondence.
On 7 March 2023 MFWRC’s solicitors wrote by email to Ms Pilkington’s solicitors saying:
Dear Colleagues,
We refer to the below.
Earlier today, we sought to understand if our correspondence was received –
referring to their email of 2 March 2023.
After contacting your firm three (3) times, of which the first two (2) calls strangely ended, we spoke with “Seth”.
We sought to speak with Mr Matthew Lynch (Mr Lynch), given our previous correspondence foreshadows an application being brought against GorvalLynch in its capacity as legal representatives of the Applicant in the above matter, this seems the proper course. Regrettably, Mr Lynch was unavailable. Seth offered to take a message, and we confirmed we hold instructions to commence an Application should there be no response to our earlier correspondence.
In response to the above, Seth posited his view our proposed application was based on an unreasonable timeframe. This is, of course, despite Seth likely having no knowledge of the below correspondence. We consider it peculiar for an administrative employee to provide their personal view of ongoing matters. Of course, this is a matter for GorvalLynch.
The purpose of our conversation today was one of cordiality and mutual respect for another legal practitioner and attempting to resolve all matters. Notwithstanding Seth’s inappropriate and quarrelsome conduct, we welcome Mr Lynch to contact our office to discuss the above matter. To be clear, should Mr Lynch not, we confirm we will commence the foreshadowed Application tomorrow.
We look forward to your response.
Mr Lynch responded in the following terms:
Do not make personal attacks against my staff, and please do not verbally abuse them on the telephone, it is highly unprofessional and unbecoming of you as a practitioner, it will, I assure you, have the opposite effect to what you intend.
Moreover your remarks are even more unreasonable in the context of your previous email requesting our response by 9:00am 8 March 2023.
Perhaps you should direct your misplaced energy to taking a brief glance at your calendar – which will assist you in confirming today is 7 March 2023.
MFWRC’s solicitors replied to that correspondence.
On 13 March 2023 MFWRC filed their application for costs in which they also sought joinder of Ms Pilkington’s solicitors by way of cross claim. That application, amongst other things, referred to r.22.06 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (“Rules”) which relevantly provides:
22.06 Order for costs against lawyer
(1)The Court or a Registrar may make an order for costs against a lawyer if the lawyer, or an employee or agent of the lawyer, has caused costs:
(a)to be incurred by a party or another person; or
(b)to be thrown away;
because of undue delay, negligence, improper conduct or other misconduct or default.
...
CONSIDERATION
It is commonplace that, upon examination and exploration in litigation, a certain set of supposed facts can look very different at the end of a case than they did at its commencement. That is particularly so in adverse action cases where the motivation for adverse action may only be fully understood after cross-examination. It is not necessarily unreasonable for an employee to have a view of a set of facts quite at odds with the reality, simply because the employee possesses incomplete or imperfect information.
The tests for the availability of costs in matters arising under the FW Act are set out in s.570 of that Act, which was quoted earlier in these reasons. To determine whether a proceeding has been brought vexatiously or without reasonable cause, it is the initiating process which has to be considered. In my view, the initiating application in this case did not manifest such shortcomings. It was based on two arguable causes of action:
(a)that Ms Pilkington was dismissed for having exercised a workplace right; and
(b)that Ms Pilkington was dismissed because of her race.
Each of those allegations was clearly made, in particular at para.13 of the initiating application, where Ms Pilkington pleaded this:
The Applicant submits that the substantive reason for the Respondent’s adverse action was because of her exercise of Workplace Right and because of her race and social origin.
The approach of MFWRC’s solicitors causes me concern. It manifests a misplaced sense of grievance. The fact that a respondent disagrees with an applicant's claims does not mean, necessarily, that they are vexatious or unreasonable. The fact that an opponent does not jump at one’s call is not unreasonable conduct. The fact that a claim is withdrawn does not necessarily mean that it was vexatious or unreasonable. Nor, without more, do such matters provide sufficient basis to seek costs against solicitors personally. In that regard, I refer particularly to r.22.06(1) of the Rules which refers to the basis of such an order being undue delay, negligence, improper conduct or other misconduct or default. Disagreement over pleadings, particularly in matters that have not proceeded to hearing, is a weak basis to make an application for costs against solicitors personally.
In this matter I consider that it is MFWRC’s conduct that has been unreasonable and that it has caused Ms Pilkington to incur costs unnecessarily. The application for summary dismissal was precipitate and misjudged. There was no reason why the parties could not have reached a reasonable and consensual position whereby Ms Pilkington made a better pleading and the respondent waited to receive it. There is no adequate explanation for the rush to file an application for summary dismissal at such an early stage of the proceeding and the error in that approach is sufficiently demonstrated by the fact that the orders made by the Court on 3 February 2023 tended to reflect the position suggested by Ms Pilkington in her correspondence, rather than the position advocated by MFWRC in its.
MFWRC’s solicitor's importuning of Ms Pilkington’s solicitors on the costs question before his own deadline arrived was also unnecessary and ultimately productive of ill-will.
At the end of the day, it is MFWRC’s failure to engage with Ms Pilkington’s email of 20 January 2023 in a constructive way that has led to additional costs. It appears to have proceeded on the incorrect understanding that the allegations in the initiating application lacked reasonable prospects of success as that term has been explained in the authorities. In the absence of such flaws, a finding that the proceeding had been brought unreasonably or vexatiously was never realistically open. This costs application should not have been brought.
As a final observation, it should be noted that the proceeding was discontinued at an early stage, meaning that costs were significantly contained.
COSTS
In my view, this costs application was misconceived. Ms Pilkington has sought her costs of this application and she will have them. According to the Court’s scale, the relevant items that apply are:
(a)item 3 of $2,093.62, being an interim or summary hearing on a discrete event; and
(b)item 9(b) of $1,255.75, being a half-day hearing, with an advocacy loading of 50% on that amount.
On my calculation that is $3,977.25.
CONCLUSION
MFWRC’s application will be dismissed.
MFWRC is to pay Ms Pilkington’s costs of and incidental to the application for costs, fixed in the amount of $3,977.25.
I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Cameron. Associate:
Dated: 26 April 2023
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