Poole v Rod Baker & Co
[2011] FMCA 357
•27 April 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| POOLE v ROD BAKER & CO | [2011] FMCA 357 |
| INDUSTRIAL LAW – Application under Fair Work Act – claim alleging dismissal in contravention of general protection provisions – claim discontinued at interim hearing – claim against wrong party – application for costs against solicitor – unreasonable act or omission. |
| Fair Work Act 2009 (Cth), ss.569, 570 Workplace Relations Act 1996 (Cth), s.824 Federal Magistrates Court Rules 2001 (Cth), rr.13.01(2)(b), 21.07 |
| Paras v Public Service Body Head of the Department of Infrastructure (No.3) [2006] FCA 745 Australia and International Pilots Association v Qantas Airways Limited(No.3) (2007) 162 FCR 392 CFMEU v Clarke [2008] FCA FC 143 Rentuza v Westside Auto Wholesale [2009] FMCA 1022 |
| Applicant: | EVA POOLE |
| Respondent: | ROD BAKER AND CO (T/AS HIGGINS INSULATION) |
| File Number: | MLG 48 of 2011 |
| Judgment of: | O’Sullivan FM |
| Hearing date: | 27 April 2011 |
| Date of Last Submission: | 27 April 2011 |
| Delivered at: | Melbourne |
| Delivered on: | 27 April 2011 |
REPRESENTATION
| Counsel for the Applicant: | Mr A. McGregor |
| Solicitors for the Applicant: | Victorian Law Company Pty Ltd |
| Counsel for the Respondent: | Mr B. Shaw |
| Solicitors for the Respondent: | Stoddart & Legal Pty Ltd |
ORDERS
The applicant have leave pursuant to Rule 13.01(2)(b) of the Federal Magistrates Court Rules 2001 to discontinue the application filed on 19 January 2011.
Allan L McGregor pay the respondent’s costs fixed in the amount of $3,974.00 within 60 days pursuant to Rule 21.07 of the Federal Magistrates Court Rules 2001.
All extant applications otherwise be dismissed and removed from the pending cases list.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLG 48 of 2011
| EVA POOLE |
Applicant
And
| ROD BAKER & CO (T/AS HIGGINS INSULATION) |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
Before the Court are proceedings which were commenced by application filed on 19 January 2011. The applicant is Eva Poole and the respondent, as named in the application, was Rod Baker & Co trading as Higgins Insulation.
The application alleged a breach of the Fair Work Act 2009 (Cth) (“the Fair Work Act”) and claimed the applicant’s employment had been terminated in contravention of the general protection provisions.[1]
The application was accompanied by a Form 2 as well as a certificate under s.369 of the Fair Work Act and a notice of termination dated
16 December 2010.
[1] see section 370 Fair Work Act
The application to this Court named the abovementioned respondent. The certificate referred to above did the same. The notice of termination accompanying the application was from Higgins Insulation (Vic) Pty Ltd not the respondent named in the application filed with the Court. The respondent in these proceedings denied it had been the applicant’s employer. Ultimately, as matters transpired, the applicant did not contest this.
The application was given a first return date of 11 March 2011. Before the first Court date the respondent filed an application in a case seeking that the application be dismissed. At the first court date both parties were represented. Mr McGregor appeared for the applicant. Mr Shaw appeared for the respondent. The Court made the following orders:
“1.The application in a case filed on 8 March 2011 be listed for hearing on 27 April 2011.
2.The Applicant to make, file and serve any further material to be relied upon by 20 April 2011.”
The applicant filed a further affidavit on 13 April 2011. The applicant has also filed an application in a case and an affidavit from her solicitor on 12 April 2011. There was also an affidavit filed on 20 April 2011 by the respondent’s solicitor.
Today the applicant is again represented by Mr McGregor.
The respondent is again represented by Mr Shaw. At the commencement of the hearing this morning it was confirmed that there was before the Court two applications:
a)an application in a case filed on 8 March 2011 by the respondent which sought:
“1.That pursuant to Regulation 13.07 of the Federal Magistrates Court Rules 2001, or otherwise, the Application of the Applicant be summarily dismissed.
2.Alternatively, that, pursuant to Regulation 11.04 of the Federal Magistrates Court Rules 2001, the Respondent be removed as a party to these proceedings.
3.That the applicant pay the Respondent’s costs of and incidental to this Application on an indemnity basis as to the Court seems appropriate.”
b)an application in a case filed on 12 April 2011 by the applicant which sought:
“1.That Higgins Insulation (Vic) Pty Ltd of 224 Princes Highway, Dandenong in the State of Victoria 3175 be added as a respondent to the proceedings.
2.Such order or order as the Court may see fit as to the question of costs.”
When the matter was mentioned the parties set out the background to the matter. The matter was then stood down on a number of occasions. The parties were then asked to confirm the material upon which they relied. They did so. There was a further brief adjournment. Shortly after 1 pm today Mr McGregor indicated to the Court, (and this has been confirmed separately for reasons that will become clear presently), that his client wished to discontinue her application filed
19 January 2011, pursuant to rule 13.01(2)(b) of the Federal Magistrates Court Rules 2001 (“the Rules”).
The oral application made by the applicant’s solicitor, which was made half way through today’s hearing, wasn’t opposed by Counsel for the respondent Mr Shaw. However the respondent did seek an order for costs. As matters ultimately transpired, the respondent sought an order for costs against the applicant’s solicitor, relying on the relevant sections of the Fair Work Act and the Rules to do so.
The Rules required that both Mr McGregor and the applicant be given a reasonable opportunity to get separate advice on that application and have a reasonable opportunity to make submissions. The matter was stood down so that the applicant could get advice from the duty lawyer. A duty lawyer came into Court after 2 pm today and confirmed that advice has been given to the applicant on the matter.
Submissions
The applicant confirmed that she wished to discontinue the application filed 19 January 2011. She also confirmed she had no issue with an order being made for costs against Mr McGregor personally.
Mr McGregor has specifically disclaimed the option of an adjournment to consider what, if any, submissions he wished to make to the Court in relation to this issue.
Mr McGregor submitted that the Court had discretion on the issue as if that needed any clarification. He also submitted that the Court should consider making an order for costs jointly with his client.
Mr McGregor submitted the Court should consider limiting the amount of costs and ultimately asked for time to make the payment in the event that the Court made any order for costs. The transcript of that exchange and those submissions speaks for itself.
As Mr Shaw’s submissions have made clear, he has sought costs relying on the argument that Mr McGregor, as the solicitor for the applicant, has caused his client to incur costs because of an unreasonable act or omission. Those submissions made clear the evidential basis upon which that argument was mounted. It is set out in Mr Stoddard’s affidavit (the respondent’s solicitor) and it makes clear that since as late as 1 March 2011 Mr McGregor was on notice as to the substantial difficulties that were confronting his client’s application. Those difficulties were set out in the correspondence that has been annexed to Mr Stoddard’s affidavit. The various jurisdictional and other difficulties confronting the application filed by Mr McGregor on behalf of his client were acknowledged by Mr McGregor today. However it was only after 12 pm today that Mr McGregor acknowledged that his client should have discontinued the application earlier.
Approach to costs application
These proceedings were commenced under the Fair Work Act.
In proceeding brought under the Fair Work Act, the issue of costs is governed by section 570 of the Fair Work Act.
Section 570 of the Fair Work Act so far as is relevant for present purposes is as follows:
“(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) exercising jurisdiction 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
…”
Sections 569 and 569A are not relevant to these proceedings.
The respondent’s costs application is brought on the basis of s.570(2)(b) of the Fair Work Act and under Rule 21.07 of the Rules. Turning firstly to the relevant sections of the Rules.
The relevant section of the Rules is Rule 21.07 which provides:
“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.
(2)A lawyer may be in default if a hearing may not proceed conveniently because the lawyer has unreasonably failed:
(a)to attend, or send another person to attend, the hearing; or
(b)to file, lodge or deliver a document as required; or
(c)to prepare any proper evidence or information; or
(d)to do any other act necessary for the hearing to proceed.
(3)An order for costs against a lawyer may be made on the motion of the Court or Registrar, or on application by a party to the proceeding or by another person who has incurred the costs or costs thrown away.
(4) The order may provide:
(a)that the costs, or part of the costs, as between the lawyer and party be disallowed; or
(b)that the lawyer pay the costs, or part of the costs incurred by the other person; or
(c)that the lawyer pay to the party or other person the costs, or part of the costs, that the party has been ordered to pay to the other person.
(5) Before making an order for costs, the Court or Registrar:
(a)must give the lawyer, and any other person who may be affected by the decision, a reasonable opportunity to be heard; and
(b)may order that notice of the order, or of any proceeding against the lawyer be given to a party for whom the lawyer may be acting or any other person.”
The provisions of section 570(2) of the Fair Work Act are similar to the provisions that were contained in the Workplace Relations Act 1996 (Cth) (“the WR Act”).
In Paras v Public Service Body Head of the Department of Infrastructure (No.3)[2006] FCA 745 Young J considered the application of those provisions in the context of an application for costs including costs of interlocutory proceedings. In doing so His Honour reviewed the background to section 824(2) of the WR Act and said:
“5. Subsection (1) of s 824 was based upon an earlier provision in s 347(1) of the WRA: see the Explanatory Memorandum to the Workplace Relations Amendment (Work Choices) Bill 2005 (Cth). It appears that subs (2) of s 824 was based upon the provision now found in s 666(1) of the WRA.
6. The Explanatory Memorandum describes s 824(2) (then numbered s 347(1A)) as an exception to subs (1):
‘2642.Pre-reform subsection 347(1) provides that a party to proceedings under the WR Act shall not be ordered to pay the costs of another party unless the first party instituted the proceedings vexatiously or without reasonable cause.
2643.Proposed subsection 347(1A) would serve as an exception to subsection 347(1). It would enable a court hearing proceedings in a matter arising under the WR Act to order one party to pay the costs of another party where that first party has, by unreasonable act [or] omission, caused the second party to incur otherwise unnecessary costs. A costs order under this subsection could be made irrespective of the outcome of the proceedings.’
7.As to the scope of s 824(1), the respondents submitted that the exception it makes for proceedings instituted vexatiously or without reasonable cause only has application to the originating application, and not to interlocutory applications made by the respondents in the course of the principal action.
8.The respondents also contended that s 824(2) does not apply to the costs of a particular aspect of the proceedings, such as an unsuccessful motion to discharge or stay an earlier interlocutory order. They submitted that subs (2) is only concerned with acts or omissions in the practical sense of things done or omitted to be done which do not accord with reasonable notions of the conduct of proceedings, such as failing to turn up at a hearing, failing to meet deadlines laid down in court directions and not giving timely notice. This submission was said to be supported by an illustrative example given in the Explanatory Memorandum.
9.In my opinion, these submissions do not accord with the authorities.”
His Honour then went on to consider the provisions of section 824(1) in the light of the authorities and continued:
“17. The illustrative example given in the Explanatory Memorandum concerns costs incurred as a result of a party’s non-compliance with Court directions. The example is consistent with the construction I have placed on s 842(2). But I do not accept that the illustrative example was intended to be exhaustive of the type of circumstances in which s 824(2) would apply.
18. In support of a narrow construction of s 824(2), the respondents referred me to several authorities that had considered the former provisions of s 170EHA, which effectively continued as s 170CS (now s 666 of the WRA): see Thomas v School of Mines Services Pty Ltd (unreported, Industrial Relations Court of Australia, Farrell JR, 5 August 1996); Turner v Composite Buyers Ltd (unreported, Industrial Relations Court of Australia, Millane JR, 28 January 1997) and Fenech v Perfect Health Medical Centres Pty Ltd (unreported, Industrial Relations Court of Australia, Ryan JR, 12 June 1998) (‘Fenech’). These cases do not support the contention that s 824(2) should be narrowly construed. In fact, in Fenech, Ryan JR referred to an earlier order made by Marshall J in the proceedings, to the effect that the respondent should pay costs pursuant to s 170EHA as a result of the dismissal of its application for an interlocutory injunction.
…
21. The respondents submitted that the notice of motion was not unreasonable. They contended that they considered, bona fide, that the Court had a discretion to reconsider its earlier order to the extent that it was based upon a less than complete appreciation of the facts concerning the breakdown in the relationship between the applicant and her immediate superiors. Notwithstanding that they consciously determined not to refer to certain facts on the earlier injunction application, they considered that, in their own interests and in accordance with their duty to the Court, they should place those facts before the Court.
22. My reasons for judgment of 26 May 2006 explain why I rejected the application to discharge the interlocutory injunction. In my opinion, the application had very limited prospects of success in the absence of evidence establishing new facts or changed circumstances. There is, however, a distinction between an application that proves unsuccessful and an application or argument that is so misconceived that it can be characterised as unreasonable or vexatious. An order for costs might be made under s 824 in the latter case but not the former: see Standish v University of Tasmania [1989] FCA 166; (1989) 28 IR 129 at 138-139 per Lockhart J; and Foxcroft v Ink Group Pty Ltd (1994) 57 IR 65 at 69. This case comes very close to the line, but in the end I am not persuaded that the motion was vexatious or unreasonable within the meaning of s 842(1), or that the pursuit of the motion involved unreasonable acts or omissions by the respondents that inflicted costs on the applicant in such a way as to attract s 824(2).”
More recently there have also been decisions of the Federal Court in Australia and International Pilots Association v Qantas Airways Limited (No.3) (2007) 162 FCR 392 and also CFMEU v Clarke [2008] FCA FC 143. In Australian and International Pilots Association v Ltd (No.3) [2007] FCA 879 where Tracey J said:
“36.In dealing with an application for costs under s 347(1) of the Act, in Standish v University of Tasmania (1989) 28 IR 129, Lockhart J was called on to decide whether the proceeding had been instituted “without reasonable cause”. His Honour drew a distinction between the pursuit of an argument which does not succeed and the institution of a proceeding which is misconceived in the sense of being incompetent: see at 138–9. This distinction may, in my view, assist in determining whether conduct is unreasonable for the purposes of s 824(2). The prosecution of any incompetent or hopeless case can be regarded as “an unreasonable act” within the meaning of s 824(2). Conversely, in my opinion, the pursuit of a contentious, and ultimately unsuccessful, argument is not an unreasonable act. In my view the applicant’s defence of its pleadings in the first strike-out application falls into the latter category…”
Section 570(2) of the Fair Work Act provides there are circumstances in which the Court can depart from the usual order that there be no order as to costs where there is an unreasonable act or omission.
Consideration
In this case, as has been acknowledged today the application faced a number of insuperable difficulties going to jurisdiction.
A jurisdictional prerequisite to the exercise of the Courts’ jurisdiction to deal with the application (even assuming the name of the respondent could be amended) is a section 369 certificate. In this case it is not controversial that the certificate that was filed with the application does not name the correct employer or respondent.
Without a proper certificate the Court does not have jurisdiction to deal with the general protections court application (see Rentuza at [21] to [23], see also Wills v Passeck [2011] FMCA 39 at [4] to [5]). In the decision of Lucev FM in Rentuza v Westside Auto Wholesale [2009] FMCA 1022 the applicant was ordered to pay costs as the Court was satisfied the relevant provisions of the Fair Work Act had either not been read or that if they had been read they appeared to have been disregarded.[2]
[2] see para 29 in Rentuza
In this case there were difficulties confronting the application which
I note had been signed by Mr McGregor and which Mr McGregor as long ago as 1 March 2011 knew confronted him being able to successfully advance a case on his client’s behalf. There is no evidence the delay in seeking to discontinue the application was due to the applicant.
The affidavit material filed on behalf of the respondent makes pellucidly clear the applicant’s solicitor was on notice prior to the first court date that the respondent would pursue a number of jurisdictional objections to the application. That correspondence, which includes responses from the applicant’s solicitor, evidences either a failure to understand the necessary jurisdictional prerequisites to making an application or a lack of attention to the necessary detail that should be expected when a solicitor prepares, as was the case here, court documentation for a client.
Since these proceedings were commenced, Mr McGregor has been on the record. It seems to me that once a solicitor is on the record and acting for party, they are obliged to conduct themselves in the litigation in a manner ordinarily required of a reasonable and competent solicitor. If a solicitor is in a position where they are acting for a party and on the record and they either don’t have funds or don’t have adequate instructions in order to be able to competently carry out the obligations that a court can expect of a reasonable and competent solicitor, then the answer is clear. They must cease to act.
Mr McGregor had the benefit since at least 11 March 2011 until right up and until today to consider his position, to mount an argument, to file material capable of sustaining an argument to meet the various jurisdictional difficulties confronting the application that had been outlined in the affidavit of Mr Stoddard and the correspondence attached thereto. He has not done so. Today having made an oral application for an adjournment shortly before midday which was refused for reasons given ex tempore, Mr McGregor then sought leave to discontinue the application.
The conduct of Mr McGregor in this matter does, I am satisfied, depart from the proper standards that could have been expected of a reasonable and competent solicitor in this matter at least insofar as it was clear, in my view, as long ago as 11 March 2011, if not earlier, that this application faced a number of difficulties. Mr McGregor has not been in a position to put adequate material before the Court as the transcript of today’s hearing make clear or to competently argue his client’s case and to do so with the requisite expedition, minimum cost and inconvenience to all parties involved.
Mr McGregor had notice well before the first return date and well before today’s date of the difficulties confronting his client’s application. He had the opportunity by virtue of the directions made on 11 March 2011 to advance a case on his client’s part or withdraw in light of the respondent’s material as he was invited to do. He didn’t. Then, having made heavy weather of the proceedings this morning, he sought leave to discontinue proceedings almost two months after the solicitor for the respondent invited him to do so in the face of the material evidencing it hadn’t been commenced against the right respondent.
The respondent has only been able to seek costs of today’s date in accordance with stage 2, schedule 1 of the Rules. Those calculations, which have been provided to Mr McGregor, haven't been cavilled with. I see no basis to consider an order that those costs be borne jointly with his client. On the material before the Court the reasons for the costs application is an unreasonable act or omission on his part, which I am satisfied has occurred and that necessitated today’s hearing.
Conclusion
In the ultimate I am satisfied the respondent has incurred costs because of an unreasonable act or omission by Mr McGregor. In this case there is no explanation for the failure to discontinue the proceedings at an earlier stage or at least prior to todays date given by Mr McGregor and there should be an order for costs under Rule 21.07.
In those circumstances, given there was no objection to the calculations, the order should be, pursuant to Rule 21.07, that Mr McGregor pay the respondent’s costs which will be fixed in the amount of $3,974 within 60 days and I so order.
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of O’Sullivan FM
Date: 27 April 2011
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