Qantas Airways Ltd v Transport Workers' Union of Australia (No 2)

[2011] FCA 816

FEDERAL COURT OF AUSTRALIA

Qantas Airways Ltd v Transport Workers' Union of Australia (No 2) [2011]
FCA 816

Citation:

Qantas Airways Ltd v Transport Workers' Union of Australia (No 2) [2011] FCA 816

Parties:

QANTAS AIRWAYS LTD v TRANSPORT WORKERS' UNION OF AUSTRALIA, TONY SHELDON, MICK PIERI, SCOTT CONNOLLY, JOHN LOADER, ALEX GALLACHER, MICHAEL MAGREE, MATTHEW SPRING and RICK BURTON

FAIR WORK OMBUDSMAN v TRANSPORT WORKERS' UNION OF AUSTRALIA, TRANSPORT WORKERS' UNION OF AUSTRALIA QUEENSLAND BRANCH, ANTHONY SHELDON, SCOTT CONNOLLY, JOHN LOADER and RICK BURTON

File numbers:

NSD 340 of 2009
NSD 1204 of 2009

Judge:

MOORE J

Date of judgment:

22 July 2011

Catchwords:

INDUSTRIAL LAW – compensation for loss and damage to "remedy the effect" of conduct contravening s 494 of the Workplace Relations Act – discretion of court when ordering compensation to be paid in order to "remedy the effects" – time to pay – penalties – whether contraventions occurred as a single course of conduct – whether respondents should be ordered to pay multiple penalties for organising industrial action in four locations

COSTS – whether s 824(1) of the Workplace Relations Act allows costs to be ordered against an applicant when there are non-industrial federal claims within a proceeding that are dismissed – whether proceedings alleging contravention of s 494 ultimately not pursued instituted vexatiously or without reasonable cause – whether secondary proceedings instituted by Ombudsman broadly similar to primary proceedings were "reasonable" – discretion to order costs against if not

Legislation:

Federal Court of Australia Act 1976 (Cth) s 52
Trade Practices Act 1974 (Cth)
Workplace Relations Act 1996 (Cth) ss 4(5), 51, 494, 728, 824, 841

Cases cited:

Australian Municipal Administrative Clerical Services Union v Greater Dandenong City Council (No 2) [2001] FCA 1076
Bahonko v Sterjov (2008) 166 FCR 415
Construction, Forestry, Mining & Energy Union v Coal & Allied Operations Pty Ltd (No 2) (1999) FCR 415
Construction, Forestry, Mining and Energy Union v Williams (2009) 262 ALR 417
Director of Public Prosecutions v Merriman [1973] AC 584
Fair Work Ombudsman v Transport Workers' Union of Australia [2010] FCA 768
Goldman Sachs JBWere Services Pty Ltd v Nikolich (2007) 163 FCR 62
I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd  (2002) 210 CLR 109
Imogen Pty Ltd v Sangwin (1996) 70 IR 254
Linehan v Australian Public Service Association (Fourth Division Officers) (1982) 66 FLR 90
Plancor Pty Ltd v Liquor Hospitality and Miscellaneous Union (2008) 171 FCR 357
Qantas Airways Ltd v Transport Workers' Union of Australia [2011] FCA 470
Rojas v Esselte Australia Pty Ltd (No 2) (2008) 177 IR 306
Stuart-Mahoney v Construction, Forestry, Mining and Energy Union (2008) 177 IR 61
CPSU, The Community and Public Sector Union v Telstra Corporation Ltd (2001) 108 IR 228

Date of hearing:

6, 7, 8, 9, 13, 14, 16 and 17 December 2010; 28 February 2011; 1, 2, 3, 4, 8, 9, 10, 11, 29, 30 and 31 March 2011; 26 and 27 May 2011

Place:

Sydney

Division:

GENERAL DIVISION

Category:

Catchwords

Number of paragraphs:

216

Counsel for the Applicant (Qantas):

F Parry SC and C O'Grady

Solicitor for the Applicant (Qantas):

Freehills

Counsel for the Applicant (Fair Work Ombudsman):

J Bourke SC

Solicitor for the Applicant (Fair Work Ombudsman):

Clayton Utz

Counsel for the Respondents:

A Hatcher SC and M Gibian

Solicitor for the Respondents:

Maurice Blackburn

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 340 of 2009

BETWEEN:

QANTAS AIRWAYS LTD
Applicant

AND:

TRANSPORT WORKERS' UNION OF AUSTRALIA
First Respondent

TONY SHELDON
Second Respondent

MICK PIERI
Third Respondent

SCOTT CONNOLLY
Fourth Respondent

JOHN LOADER
Fifth Respondent

ALEX GALLACHER
Sixth Respondent

MICHAEL MAGREE
Seventh Respondent

MATTHEW SPRING
Eighth Respondent

RICK BURTON
Ninth Respondent

JUDGE:	MOORE J
DATE OF ORDER:	22 JULY 2011
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.A penalty of $20,000 be imposed on the first respondent in respect of its contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

2.A penalty of $5,000 be imposed on the second respondent in respect of his contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

3.A penalty of $2,500 be imposed on the third respondent in respect of his contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

4.A penalty of $3,000 be imposed on the fourth respondent in respect of his contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

5.A penalty of $1,500 be imposed on the fifth respondent in respect of his contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

6.A penalty of $4,000 be imposed on the sixth respondent in respect of his contravention of s 494(1) of the Workplace Relations Act1996 (Cth).

7.A penalty of $2,000 be imposed on the ninth respondent in respect of his contravention of s 494(1) of the Workplace Relations Act 1996 (Cth).

8.Pursuant to s 841(b) of the Workplace Relations Act1996 (Cth), the penalties be paid to the applicant, Qantas Airways Limited.

9.Pursuant to s 494(5)(b) of the Workplace Relations Act1996 (Cth), the first respondent pay the sum of $707,345 to the applicant within 2 months of the date of this order.

10.Pursuant to s 51A of the Workplace Relations Act 1996 (Cth) the first respondent pay interest on the sum referred to in order 9 on and from 30 March 2009 to the date of judgment in accordance with practice note CM 16 such sum to be included in the sum for which judgment is given.

11.Leave be given for the applicant to discontinue against the eighth respondent.

12.The application is otherwise dismissed.

13.The respondents' cross-claim is dismissed. 

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1204 of 2009

BETWEEN:

FAIR WORK OMBUDSMAN
Applicant

AND:

TRANSPORT WORKERS' UNION OF AUSTRALIA
First Respondent

TRANSPORT WORKERS' UNION OF AUSTRALIA QUEENSLAND BRANCH
Second Respondent

ANTHONY SHELDON
Third Respondent

SCOTT CONNOLLY
Fourth Respondent

JOHN LOADER
Fifth Respondent

RICK BURTON
Sixth Respondent

JUDGE:	MOORE J
DATE OF ORDER:	22 JULY 2011
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The application be dismissed.

2. The applicant pay the respondents the costs incurred in these proceedings which are additional to the costs incurred defending or meeting the claims in proceedings NSD 340 of 2009. 

   Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
   The text of entered orders can be located using Federal Law Search on the Court’s website.

   
   

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 340 of 2009

BETWEEN:

QANTAS AIRWAYS LTD
Applicant

AND:

TRANSPORT WORKERS' UNION OF AUSTRALIA
First Respondent

TONY SHELDON
Second Respondent

MICK PIERI
Third Respondent

SCOTT CONNOLLY
Fourth Respondent

JOHN LOADER
Fifth Respondent

ALEX GALLACHER
Sixth Respondent

MICHAEL MAGREE
Seventh Respondent

MATTHEW SPRING
Eighth Respondent

RICK BURTON
Ninth Respondent

JUDGE:	MOORE J
DATE:	22 JULY 2011
PLACE:	SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1204 of 2009

BETWEEN:

FAIR WORK OMBUDSMAN
Applicant

AND:

TRANSPORT WORKERS' UNION OF AUSTRALIA
First Respondent

TRANSPORT WORKERS' UNION OF AUSTRALIA QUEENSLAND BRANCH
Second Respondent

ANTHONY SHELDON
Third Respondent

SCOTT CONNOLLY
Fourth Respondent

JOHN LOADER
Fifth Respondent

RICK BURTON
Sixth Respondent

JUDGE:	MOORE J
DATE:	22 JULY 2011
PLACE:	SYDNEY

1........ . INTRODUCTION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[1]
2........ . COMPENSATORY ORDERS........ ........ ........ ........ ........ ........ ........ ........ ........ ..	[4]
2.1...... The nature and the exercise of the power to make an order remedying the effects of industrial action......... ........ ........ ........ ........ .....	[4]
2.2...... Additional labour costs for ground staff........ ........ ........ ........ ........ ........ .	[18]
2.2.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[18]
2.2.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[19]
2.2.3... The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[23]
2.2.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[25]
2.3...... Mishandled baggage........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[31]
2.3.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[31]
2.3.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[37]
2.3.3... The TWU’s Submissions........ ........ ........ ........ ........ ........ ........ .....	[44]
2.3.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[46]
2.4...... Accommodation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[50]
2.4.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[50]
2.4.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[51]
2.4.3... The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[52]
2.4.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[53]
2.5...... Transport........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[54]
2.5.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[54]
2.5.2... Qantas’ Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[55]
2.5.3... The TWU’s Submissions........ ........ ........ ........ ........ ........ ........ .....	[58]
2.5.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[59]
2.6...... Meal Vouchers........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........	[60]
2.6.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[60]
2.6.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[62]
2.6.3... The TWU’s Submissions........ ........ ........ ........ ........ ........ ........ .....	[63]
2.6.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[64]
2.7...... Flight delays........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[67]
2.7.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[67]
2.7.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[68]
2.7.3... The TWU's Submissons........ ........ ........ ........ ........ ........ ........ ......	[70]
2.7.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[71]
2.8...... Flight Interruption Manifests........ ........ ........ ........ ........ ........ ........ ........ .	[72]
2.8.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[72]
2.8.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[73]
2.8.3... The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[75]
2.8.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[76]
2.9...... Miscellaneous costs........ ........ ........ ........ ........ ........ ........ ........ ........ ........	[77]
2.9.1... Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[77]
2.9.2... Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[78]
2.9.3... The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[80]
2.9.4... Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[82]
2.10.... Offshore losses........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[83]
2.10.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[83]
2.10.2. Qantas’ Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[84]
2.10.2.1..... Christchurch........ ........ ........ ........ ........ ........ ........ .	[87]
2.10.2.2..... Auckland........ ........ ........ ........ ........ ........ ........ ........ .	[89]
2.10.2.3..... Los Angeles........ ........ ........ ........ ........ ........ ........ ....	[91]
2.10.2.4..... New York........ ........ ........ ........ ........ ........ ........ ........ .	[93]
2.10.2.5..... Hong Kong........ ........ ........ ........ ........ ........ ........ ......	[95]
2.10.2.6..... Bangkok........ ........ ........ ........ ........ ........ ........ ........ ..	[97]
2.10.2.7..... Singapore........ ........ ........ ........ ........ ........ ........ ........	[99]
2.10.2.8..... Shanghai........ ........ ........ ........ ........ ........ ........ ........ ..	[101]
2.10.2.9..... Beijing........ ........ ........ ........ ........ ........ ........ ........ ......	[103]
2.10.2.10... Manila........ ........ ........ ........ ........ ........ ........ ........ .....	[104]
2.10.2.11... Indonesia........ ........ ........ ........ ........ ........ ........ ........ .	[106]
2.10.2.12... Johannesburg........ ........ ........ ........ ........ ........ ........ .	[107]
2.10.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[109]
2.10.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[111]
2.11.... Customer care........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[112]
2.11.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[112]
2.11.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[116]
2.11.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[117]
2.11.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[118]
2.12.... Technical crew........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[122]
2.12.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[122]
2.12.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[123]
2.12.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[129]
2.12.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[132]
2.13.... Cabin crew........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[133]
2.13.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[133]
2.13.2. Qantas's Submissions........ ........ ........ ........ ........ ........ ........ ........ .	[135]
2.13.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[137]
2.13.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[139]
2.14.... Fuel usage........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[144]
2.14.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[144]
2.14.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[145]
2.14.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[148]
2.14.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[152]
2.15.... Maintenance........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...	[154]
2.15.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[154]
2.15.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[156]
2.15.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[157]
2.15.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[158]
2.16.... Freight........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .....	[159]
2.16.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[159]
2.16.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[160]
2.16.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[162]
2.16.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[165]
2.17.... Telesales........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[167]
2.17.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[167]
2.17.2. Qantas' Submissions........ ........ ........ ........ ........ ........ ........ ........ ...	[170]
2.17.3. The TWU's Submissions........ ........ ........ ........ ........ ........ ........ .....	[171]
2.17.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[172]
2.18.... Brand and Reputation........ ........ ........ ........ ........ ........ ........ ........ ........ .....	[173]
2.18.1. Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[173]
2.18.2. Qantas' submissions........ ........ ........ ........ ........ ........ ........ ........ ....	[174]
2.18.3. The TWU's submissions........ ........ ........ ........ ........ ........ ........ ......	[177]
2.18.4. Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[181]
2.19.... Time to Pay and Interest........ ........ ........ ........ ........ ........ ........ ........ ........	[182]
3........ . PENALTIES........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........	[184]
4........ . COSTS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[201]
4.1...... Submissions on costs........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[201]

REASONS FOR JUDGMENT

1.               INTRODUCTION

1. Qantas Airways Ltd ("Qantas") commenced proceedings (NSD 340 of 2009) on 23 April 2009 against the Transport Workers' Union of Australia ("TWU") and individual respondents alleging contravention of s 494 of the Workplace Relations Act 1996 (Cth) ("WR Act"), the commission of the torts of inducing breach of contracts, interference with trade or business by unlawful means and nuisance, breaches of clause 7 and 11 of the Qantas Enterprise Agreement ("EBA 7") and contravention of what was then called the Trade Practices Act 1974 (Cth) ("Trade Practices Act"). The Fair Work Ombudsman ("Ombudsman") commenced separate but similar proceedings alleging contravention of s 494 of the WR Act on 26 October 2009 seeking the imposition of penalties (NSD 1204 of 2009). I should, at this point, note that Qantas filed only one application and one statement of claim though each was subsequently amended. The proceedings commenced by that process were given the one matter or proceedings number. This is relevant to a later discussion about costs. The trial of the Ombudsman's proceedings was held jointly with the Qantas proceedings. The TWU cross-claimed.

2. In reasons published on 13 May 2011 Qantas Airways Ltd v Transport Workers' Union of Australia [2011] FCA 470 ("liability judgment" which is to be read in conjunction with this judgment), I indicated I would dismiss the claim under the Trade Practices Act and the tortious claims of interference with trade or business, inducing breach of contract and nuisance. I indicated the cross-claim should also be dismissed. I concluded some of the respondents had engaged in unlawful industrial action in contravention of s 494. There were three aspects of Sheldon's conduct that involved contravention of s 494. The conduct of Pieri, Connolly, Loader, Gallacher and Burton also involved contravention of s 494. I found that Magree did nothing which constituted contravention of s 494. Qantas discontinued the proceedings against one respondent, Spring. However no formal orders were made giving effect to these conclusions.

3. In the liability judgment I discussed two legal issues in relation to which the TWU has made further submissions. While Qantas and the Ombudsman have, themselves, made further responsive submissions, the primary position of at least Qantas is that what I said in the liability judgment should be taken to have determined those legal issues and they should not be reopened. The issues concern the nature of the power conferred by s 494(5)(b) and whether some of the individual respondents had engaged in particular conduct which resulted in one or a number a number of contraventions of s 494(1). No orders were made giving effect to what I said in the liability judgment and, at least in relation to the second issue, the arguments now advanced by all parties were not made initially or at least did not then focus, as they now do, my attention on an important issue. Both legal issues are not, as far as I am aware, the subject of a considered judgment in this Court or elsewhere. In these circumstances I propose to give further consideration to both legal issues. It is preferable, I think, for me to endeavour to arrive at the right answer rather than insist upon adhering to an earlier answer (if they be different). I address the power issue now and the contravention issue later.

   2.               COMPENSATORY ORDERS

   2.1             The nature and the exercise of the power to make an order remedying the effects of industrial action.

4. Qantas' position was to the following effect. It seeks payment of a sum of money to remedy the effects of the respondents' contraventions of s 494(1) on 25 and 30 March 2009. Qantas submitted that the terms of s 494(5)(b) should not be read narrowly and referred to I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109. The word "remedy" should be understood as "the means by which the violation of a right is prevented, redressed, or compensated" or "reparation, redress, relief". Reference was made to the decision of Madgwick J in Australian Municipal Administrative Clerical Services Union v Greater Dandenong City Council (No 2) [2001] FCA 1076 where his Honour stated that the phrase "and any other orders" refers to "any reasonable curial order" and one that gives the court "maximum power and flexibility" to do what is appropriate in the circumstances.

5. The amount it sought to compensate it for the loss and damage arising from the events of 30 March 2009 is approximately $1.2 million plus interest from 30 March 2009 to the date of judgment.  While it is extremely difficult to precisely quantify the pecuniary loss it suffered, an order requiring payment is not limited to pecuniary loss that can be specifically proven.  The sum awarded can be based on all the circumstances, reflecting the pecuniary loss and can be estimated by the Court.  If further loss is reasonably incurred in an effort to mitigate the damage, this may also be recovered.  Once significant loss has been established, the Court can assess the financial loss and order the TWU to compensate it.  It did seek orders requiring individual respondents to compensate it for its loss.  There should not be any reduction in the compensation payable because there may have been other factors which contributed to the extent of its loss or because some of the amounts it paid were more than it was contractually bound to pay.  Penalties that may be ordered are not intended to provide compensation. 

6. The respondents' position was to the following effect. An order for the payment of monetary compensation cannot be made under s 494(5)(b) of the WR Act. If however, an order of that type can be made, the power (to make the order) is discretionary. If an award of compensation is made in this matter the amount should be minimal due to the failure of Qantas to take reasonable steps to avoid or minimise the loss or damage related to the stoppage. A number of reasons were advanced as to why the full amount of any loss or damage proved by Qantas should not be awarded. They included that Qantas could have avoided a very substantial part of any loss or damage incurred if they had adopted the same approach at Sydney International Terminal ("SIT"), Brisbane, Adelaide and Perth as they did at Sydney Domestic Terminal ("SDT") where they facilitated a return to work by agreeing to pay employees for the two hour meeting. In addition, Qantas failed to take action to facilitate employees returning to work even where they indicated a willingness to do so.

7. Substantially for the reasons I gave in the liability judgment, I consider I have power to order the payment of a sum of money by a person or corporation who has engaged in industrial action if the payment remedies the effect of the industrial action.  That would arise when the industrial action caused financial loss to the person to whom payment was, under the order, to be made.   The payment would thereby remedy the effect of the industrial action.

8. I accept, and notwithstanding observations suggesting otherwise in the liability judgment, that the power to make the order and to determine its scope and terms is discretionary. How the order was framed would depend on, amongst other things, how the effect was characterized. I do not doubt that while s 494(5) speaks of "effect" in the singular it would comprehend "effects" in the plural. Industrial action may have a multiplicity of particular effects and whether any, some or all of them were to be remedied by an order would be a matter for the Court to determine as a matter of discretion. I focus a little more on the nature of the power when I consider the first subject matter identified by Qantas as an area of its operations or business in which it suffered a loss (additional labour costs for ground staff). I have analysed the losses by using the same approach (as to subject matter) adopted by the parties.

9. However, I should observe at this stage that the nature of the discretion to order the payment of a sum to remedy the effects of industrial action is not, in my opinion, exercisable by reference to general considerations of fairness.  It is a power conferred for a specific purpose as part of a statutory scheme which made certain conduct unlawful.  Whether this proscription of conduct is, in some broad sense, fair, desirable or appropriate is not a matter for me to assess.  Also whether engaging in proscribed conduct might, in any given situation, be reasonable or justifiable on broad grounds concerning fairness or "industrial justice" is again not a matter for me to assess.  Once it is accepted that the purpose of the conferral of the power to make an order to remedy the effects of industrial action is to address the consequences of unlawful industrial action then the exercise of the discretion both to make an order and to determine the terms on which it is made, is limited.

10. It would be undesirable for me to endeavour to catalogue in a comprehensive way, considerations which might inform the exercise of the discretion.  However, I can deal with those that appear to me as possibly arising in the present case.  First, an application needs to be made for an order, at least in the ordinary course.  Qantas need not have, but has, made such an application.  Another employer in similar circumstances might conclude that, on balance, it was preferable not to risk alienating or antagonizing its workforce, and the union and its officers representing them, by seeking an order for payment of money from union funds.  However, Qantas has a legal right to seek an order and it has exercised that right.  It is entitled to do so.

11. Another consideration would be whether the application for the order was bona fide.  By that I mean the order was not being sought for an ulterior purpose.  There has been no suggestion in the evidence or in the submissions that Qantas has sought the order, not simply to secure payment to compensate it for losses suffered, but rather to secure some advantage in future workplace negotiations with the TWU and its members which Qantas employs.  Such negotiations are, I assume, imminent as EBA 7 nominally expired on 1 July 2011.  Had there been such an ulterior purpose, I would not make the order I propose to make.

12. Another consideration would be whether the effect of the industrial action was occasioned, in whole or in part, by the unreasonable conduct of the party seeking the order and, in particular, unreasonable conduct in response to the industrial action.  In the present case the respondents submitted it was.  They pointed to Qantas acting at SIT, Brisbane, Adelaide and Perth on the basis that it was obliged not to pay the TWU members who had engaged in some form of industrial action four hours pay.  This, the respondents pointed out, was not the approach Qantas adopted at SDT where some industrial action was effectively sanctioned by local management, the employees told their pay would not be docked and they returned to work.  I must acknowledge the difference in approach.  However, the response at SIT, Brisbane, Adelaide and Perth was not the unreasonable one, in the circumstances.  On one view of s 507 (but not, in my opinion, the correct view) the employer has no capacity to agree or approve of industrial action after it has taken place.  On that view Qantas was obliged to take the approach it did.  Also it was not unreasonable to inform the TWU membership of the consequences for them of what they had done.  I would not infer that Qantas' response (even though one of the principal architects of the response, Brad Moore, was not called) was anything other than a genuine response to events as they unfolded, based on the legal effect of s 507 as understood by Moore and others.

13. Also the respondents point to the failure of Qantas to take up offers made at some airports by the workforce to return to work sooner than they, in fact, did.  However, having deployed contingency teams of salaried staff to handle unprocessed baggage, it was not unreasonable for Qantas to avoid an environment where there was a possible intermingling of salaried staff and the usual workforce in circumstances where there was likely to be a high measure of animosity on the part of the usual workforce directed to Qantas personified by the management staff then processing baggage.  This antipathy was illustrated by the conversation in Brisbane with Goebel (see liability judgment [213]).  In any event, the offers to return to work were either conditional (see liability judgment [175]) or limited as to the number of employees making the offer (see liability judgment [175] and [219]).

14. Another consideration would be whether the effect of the industrial action was foreseen by those who engaged in it or, if not, was nonetheless reasonably foreseeable.  In the present case it is probable the effect was foreseen by the respondents, particularly Sheldon, Gallacher and Connolly.

15. Another consideration would be whether compliance with the order was practicable or likely.  This would be particularly so if the order was not directed to the payment of money.  However, as to such an order in the present case, no submission was made that the TWU did not have the capacity to pay the amounts to be ordered though obviously it will have the significantly undesirable consequence of depleting funds which are, in effect, the funds of the membership as a whole which would otherwise be deployed for the benefit of that membership.

16. I am not persuaded I should exercise my discretion not to make an order requiring the TWU to compensate Qantas for the losses it suffered.  I am satisfied I should.

17. I should deal with one other matter.  The industrial action of the respondents was not the immediate cause of the losses suffered by Qantas.  It was the conduct of the TWU membership in stopping work and not resuming work for a period of four hours (see liability judgment [360]).  Even though in many instances, the TWU membership was not contractually bound to work for a period (see liability judgment [349]) that situation arose as a direct consequence of a chain of events precipitated by the calling of the meetings and the way in which they were called.  That, in turn, had its genesis in the decision to hold the meetings taken on 25 March 2009.  The TWU is responsible for the unlawful conduct of the other respondents as well as delegates (see liability judgment [374]).  The unlawful conduct of the other respondents, and in particular making the decision taken at the meeting on 25 March 2009, led to the conduct of the TWU membership.  It was a foreseen and foreseeable consequence of the unlawful conduct of the individual respondents and of the TWU.  In these circumstances the consequences of the unlawful conduct of all respondents was the failure of the TWU membership to undertake tasks such as processing baggage as they otherwise would have done on 30 March 2009.  That led directly to certain losses (discussed shortly) for which the TWU should be ordered to compensate Qantas as a method of remedying the effect of the unlawful conduct of all the respondents.  I proceed now to consider the claimed losses by reference to the framework (as to subject matter) adopted by the parties.  In this analysis I refer to the submissions of the respondents as those of the TWU only given that the order is sought only against the TWU.

    2.2             Additional labour costs for ground staff

    2.2.1Evidence

18. As would be apparent from the liability judgment, the events of 30 March 2009 quickly led to an accumulation of unprocessed baggage at various airports with the corresponding need to process them.  This was undertaken, in part, by contingency teams of salaried employees and other employees working overtime.  Qantas has sought the payment of an amount representing the notional cost of the work undertaken by the salary employees and the actual additional cost of the overtime.  Evidence on this subject matter concerning loss and damage suffered by Qantas as a result of the industrial action on 30 March 2009 was given primarily by Wendy Burgess (Qantas financial controller New South Wales) and supported by Brett Hardy (Qantas financial controller New South Wales), Mark Simmons (Qantas financial controller Melbourne airport), Richard Crippin (Qantas financial controller Northern Australia) and Craig Burton (Qantas financial controller Brisbane).  I will refer to as much of the evidence as necessary when summarising the submissions to be able to deal with this matter (and as I will in discussing the other claimed heads of loss).  However I should note that the quality and probative effect of much of this evidence concerning additional labour costs was challenged by the TWU.  It is, I think, unnecessary to dwell on this evidentiary issue given the conclusion I have reached about the case advanced by Qantas at a more general level of principle.

    2.2.2Qantas' Submissions

19. As a result of the industrial action and subsequent flight delays on 30 March 2009 Qantas incurred losses as it was required to deploy extra staff to assist dealing with baggage arrivals, departure lounges and customer handling activities.  Some employees were also required to perform overtime to attempt to bring its network back into normal operation over the subsequent days.  A number of its salaried corporate and administrative staff were deployed as contingency teams at various airports around Australia to provide assistance to regular airport staff.

20. Following the industrial action Burgess requested several Qantas financial controllers to collate data recording additional labour costs incurred as a result of the stoppage.  There was an additional 4,371 hours of work performed resulting in a total cost of $227,872.  An order should be made requiring the TWU to pay that amount.  This figure does not include costs relating to engineering, technical or cabin crew, all of which are dealt with separately.  The table below quantifies, by reference to locations and designations, its claim:

Additional Labour Costs incurred
Location	Ordinary Customer Service	Ordinary Ramp Services	Ordinary Admin/Corporate Staff	Overtime Customer Service	Overtime Ramp Services	Overtime Baggage Security Services		Departure Lounge	Overtime Departure Lounge
SIT	$1,725	$0	$98,305 (contingency team of 164 staff for 30 and 31 March 2009)	$26,894	$13,001	$0		$2,000		$1,320
SDT	$690	$874	$15,182 (contingency team of 15 admin staff for 30 and 31 March 2009)	$154	$352	$0		$0		$0
Melbourne Domestic	$598	$575	$1,518	$6,380	$6,336	$2,160		$480		$3,102
Brisbane Domestic	$2,162	$0	$11,387	$4,268	$0	$0	$560			$960
Perth Domestic	$152	$522	$0	$713	$2,543	$0	$0			$0
Adelaide	$233	$0	$1,771	$6,055	$2,112	$0	$0			$469
Cairns	$0	$0	$0	$198	$1,078	$0	$0			$0
Darwin	$391	$35	$1,518	$1,892	$836	$0	$200			$231
Townsville	$0	$0	$0	$44	$176	$0	$0			$0
Alice Springs	$23	$0	$0	$1,320	$1,760	$0	$0			$0
Ayers Rock	$83	$97	$0	$1,597	$840	$0	$0			$0
TOTAL	$6,057	$2,103	$129,681	$49,515	$29,034	$2,160	$3,240			$6,082

These calculations were made on the basis of non-salaried staff being paid $23 per hour for non-overtime work and $44 per hour for overtime work, and salaried staff being paid $63 per hour.  The hourly rates are the average rates paid to respective employees.  It can be seen that the total additional labour costs for non-salaried staff were $98,191.

1. At SIT, 164 Qantas corporate and administrative staff were re-deployed as part of a contingency team to assist on the day of the stoppage.  These staff were unable to perform their normal duties while they were part of the contingency team at SIT.  This resulted in a loss to it of $98,305.  Similarly at SDT, Melbourne, Brisbane, Adelaide and Darwin contingency teams were deployed (for which an amount is claimed).  The total cost of deploying these teams (including at SIT) was $129,681.

1. The TWU cannot call into aid what it said were savings in labour costs of $45,080 relating to employees (TWU membership) being docked four hours pay and labour hire employees not being paid for four hours on the day of the stoppage, as there were no productivity gains by it as a result of these employees stopping work for that period.

   2.2.3The TWU's Submissions

2. There were no additional labour costs incurred by Qantas as a result of the industrial action for any salaried employees who formed contingency teams at a number of airports.  They continued to receive their usual salary and could have made up any additional hours required to perform their normal duties without Qantas having to pay them any additional wages.  Burgess' oral evidence about contingency team staff sitting in rooms at SIT on the day of the stoppage and not actually performing any duties to assist with the operation of the business could not give rise to liability on the part of it to pay the claimed $98,305 in relation to SIT.  The same considerations arise in relation to salaried staff at SDT, Melbourne Domestic, Brisbane Domestic, Adelaide and Darwin as arise in relation to Sydney, and that there is no liability on its part to pay the total amount of $129,681 relating to salaried staff that is claimed as a loss by Qantas.

3. Further, Qantas in fact made some labour cost savings of $45,080 on the day of the stoppage as there were approximately 490 employees who were docked four hours pay by not paying them for a period where they would otherwise have been paid.  At most, any loss that could be proved in relation to additional labour costs would be $53,111.  This figure is reached by totalling the additional labour costs of all of the non-salaried Qantas staff, being $98,191, subtracting what were labour savings made by Qantas as a result of the docking of four hours pay of ramp services staff on 30 March 2009 and excluding the amount of $129,681 attributable to salaried staff.

   2.2.4Consideration

4. This subject matter directly raises for consideration the content of the power to make in order to "remedy [the industrial action's] effect" in so far as that power might be exercised to order the payment of money. It may well be that many of the principles concerning the assessment of damages and the awarding of monetary compensation in other contexts would be apt to apply to the exercise of this power. But that would not be because they are principles of general application but rather because they establish an approach which aligns with this statutory power having regard to the way in which it is expressed and the purpose for which the power is conferred. However, in my opinion, I should not be distracted by those principles from the terms in which the power is conferred and its purpose and the constraints and limits those terms create. An obvious starting point when considering whether to make an order and in what terms, is to identify a possible "effect" of proscribed industrial action established in the proceedings. Part of that task is to determine whether the proscribed industrial action brought about that "effect". Having done so it is then necessary to consider whether the orders sought "remedy" that "effect".

5. In relation to a proposed order requiring the payment of money, it seems to me that it would be necessary for the Court to be satisfied that the beneficiary of the proposed order had suffered an actual loss, incurred an actual expense or directly forewent income as the "effect" before an order could be made requiring such a payment.  That is because, in my opinion, only if there had been such a loss or expense would the receipt of money remedy its effect.  If I could illustrate this by reference to an aspect of this head of compensation claimed by Qantas.  Salaried employees were needed to work on contingency teams to deal with accumulating baggage.  This was an effect of the industrial action.  They were paid their salary while undertaking this work.  The payment of these salaries was not an effect of the industrial action.  They would have been paid anyway.

6. It may be possible to characterise one effect of the industrial action as being that salaried employees were required to perform tasks they would not ordinarily perform and were distracted from their ordinary duties.  (As an aside I should observe that if, as it was, working in a contingency team was part of what a salaried employee might be required to do then this dichotomy between ordinary and other duties probably is of no moment.  The only relevant question is whether working on a contingency team was part of those duties.  The answer appears clearly to be yes).  However one then asks how this effect is remedied by ordering the payment of money.  I cannot see how it is.  It would be different if overtime (or some other additional payment) had been paid to members of the contingency team or other people engaged to perform the ordinary duties of the members of the contingency team either then or later.  The need to pay the overtime (or some other additional payment) or pay the additional staff would be an effect remedied by an order to pay money.  But how does the payment of money remedy the effect of salaried employees working on a contingency term?  In my opinion it does not. 

7. One effect of the industrial action was that Qantas had to pay additional overtime to non-salaried employees to deal with accumulated baggage.  Accordingly an order can (and should) be made requiring the TWU to pay Qantas an amount equivalent to the additional overtime payments.  Such an order will remedy an effect of that action.

8. It is convenient, at this point, also to consider the question of whether some form of offsetting should be undertaken in relation to what is said by the TWU to be a saving to Qantas because a significant sum did not have to be paid to employees who had their pay docked for four hours.  It is true Qantas did not pay some of its workforce wages it would otherwise have been obliged to pay.  But were Qantas to have made the payment, it would have been on the basis that Qantas received some benefit in return (the performance of work). It received no such benefit.  There was no real "saving".

9. I propose to order the TWU to pay Qantas $98,191 to remedy this aspect of the effect of the industrial action.

   2.3             Mishandled baggage

   2.3.1Evidence

10. It was not in issue that, as a result of the events of 30 March 2009, some passengers flew from the airports at which the industrial action took place without their baggage in the holds of their planes.  The baggage was transported on later flights.  It was also not in issue that, in addition, some passengers were not able, at their destination, to retrieve baggage which did accompany them within a reasonable period and left the airport without it.  It was not in issue that Qantas took steps to reunite these passengers with their baggage.  It did so by arranging for it to be couriered or otherwise delivered to the passenger at their home or where they were staying.  Qantas incurred costs in doing this.  Plainly this is an effect of the industrial action which can be remedied by an order that the TWU pay Qantas an amount equal to the costs incurred.  The central issue is what that amount is.

11. This cost was initially addressed in Burgess' affidavit sworn 1 October 2010.  She indicated that there was a significant amount of mishandled baggage as a result of the stoppage on 30 March 2009.  It took approximately a week to rectify the problem.  The baggage could not be loaded on to or unloaded from aircraft and had to be stored temporarily.  The mishandled baggage was couriered to passengers at Qantas' expense.   Burgess used the Worldtracer Management System ("Worldtracer") to calculate the average cost of repatriating a bag to its owner.  The average cost includes the cost of couriers and handling fees.  Burgess swore a supplementary affidavit on 12 December 2010 which provided further details about the mishandled bags, including the procedure undertaken when a bag is reported "missing", the reasons that not all the mishandled bags were recorded in Worldtracer, and the reasons why it is very difficult to determine the precise cost of mishandled baggage using only the invoices received from the courier companies.

12. The estimate of mishandled bags was provided to Burgess by Hardy.  Hardy, in his affidavit of 14 December 2010, estimated that there were 2,250 mishandled bags for SIT and 1,500 for SDT.  These numbers were attained by his observations and the observations of Claudio Grasso, at the time the Customer Services Manager.  Hardy said that he was not able to record precisely the number of mishandled bags because they were piled on top of each other and his priority was to sort which bags were to remain in Sydney and which ones had to be sent to other ports.

13. The functioning of Worldtracer was explained by Hardy.  A Worldtracer record is generated for each customer when they complete a report or generate a mishandled baggage file.  There is no record of the passenger's misplaced baggage in the system unless a form is completed, so not all mishandled bags arising from the stoppage on 30 March 2009 would have been recorded in the system.  A form would not have been completed if the passengers waited at the airport until their baggage was located, if they returned later in the day or if the mishandled baggage was forwarded to other ports within Australia, in which case the record may have been created at a port other than Sydney.  Passengers on international flights may have departed without their baggage and it would have been forwarded on the next available flight.  The data on Worldtracer is therefore not a complete representation of all the mishandled baggage.

14. Hardy explained that the data from Worldtracer is simultaneously transferred to the Qantas Corporate Data Warehouse ("CDW") and Airline Services Operations Reports are generated weekly.  The increase in numbers of mishandled baggage was based on a review of reports.  Hardy said that the spreadsheet records indicated that on 30 March 2009 in Sydney, 1161 bags were mishandled, an increase from the average range of 100 to 200 bags earlier in the month.  The spike in the numbers of mishandled bags from the report of 29 March 2009, to the numbers in the report of 5 April 2009 was regarded by Hardy as significant.  A table of lost bags per 1,000 passengers was provided as follows:

Port	Report Week Ending 29 March 2009	Report Week Ending 5 April 2009
Perth	5.3	51.2
Adelaide	1.9	30.1
Sydney	9.1	23.2
Brisbane	6.2	14.2
Melbourne	5.5	12.8
Other	2.3	1.9

1. Evidence was provided by Simmons about the number of mishandled bags in Melbourne, Hobart/Launceston and Adelaide arising from the stoppage on 30 March 2009.  In his affidavit, dated 13 December 2010, Simmons said that the estimate of 800 mishandled bags was based on a visual inspection of bags on the ground floor of Melbourne Airport and feedback from finance colleagues, Susi Dispirito and Adrian Grawe.  Madeleine Astill (Finance Analyst, Adelaide Airport) provided the estimate in Adelaide of 1,000 bags and John Bradford (Airport Manager, Tasmania) provided the estimate of 60 bags for Hobart/Launceston.  Simmons gave these estimates to Burgess.

   2.3.2Qantas' Submissions

2. In the submissions of Qantas of 21 March 2011 reference was made to the evidence of Burgess.  The reasons Burgess found it "very difficult" to determine the precise costs arising from mishandled baggage using only the invoices received from courier companies were summarised as follows:

   (a) Qantas uses a number of different courier companies;

   (b) not every piece of baggage is reconciled and delivered to a passenger on the same day it is reported missing;

   (c) courier invoices may be received up to 6 months after the cost has been incurred;

   (d) many courier companies do not attach copies of mishandled bag tag numbers (which are used to identify the bags) to their invoices; and

   (e) the invoices do not include monetary compensation provided to passengers, labour costs or insurance costs associated with mishandled baggage.

3. The cost of repatriating baggage as a result of the stoppage was summarised by Qantas as $138,602.65 which was based on:

   (a) taking the number of Worldtracer files generated for mishandled bags on 30 and 31 March 2009;

   (b) multiplying that number by the total average repatriation cost per file during March 2009, as recorded in Worldtracer; and

   (c) subtracting the equivalent average daily figures for March (other than 30 and 31 March 2009 and April 2009).

4. The calculations were summarized by Qantas as follows:

Total Number of Files in Respect of Mishandled Bags (30 and 31 March 2009) less equivalent daily averages)	Average Repatriation Cost (per file)	Cost of Repatriating Mishandled Bags
Sydney	1238.1	$39.62	$49,053.52
Melbourne	340.2	$28.81	$9,801.16
Hobart/Launceston	0	$28.81	$0.00
Brisbane	282.48	$43.22	$12,208.79
Perth	1188.86	$43.22	$51,382.53
Adelaide	546.76	$28.81	$15,752.16
Darwin/Cairns/Ayers Rock/Mackay/Alice Springs/Townsville	14.04	$28.81	$404.49
TOTAL	$138,602.65

The cost of repatriating bags in Hobart/Launceston, Adelaide and Darwin was calculated by Burgess using the Melbourne average repatriation cost.  The cost of repatriating bags in Perth was calculated using the Brisbane average.

1. Evidence relating to mishandled baggage in the northern Australian airports was provided by Crippin in his affidavit of 13 December 2010.  Crippin provided this information to Burgess.  He said there were 350 mishandled bags, although he was not aware how each of the airport managers determined the number of mishandled bags at each port.

2. Burgess' estimated cost of repatriating mishandled baggage based on Worldtracer was generally consistent with the invoices submitted by Qantas.  The exceptions included the invoices for Adelaide which indicated courier costs of $15,238, slightly less than the $15,752.16 estimated by Burgess.  The invoices for Melbourne indicated that the costs of delivering mishandled baggage on 31 March and 1 April 2009 was $28,961.00 which was greater than the estimate provided by Burgess of $9,801.16.  The averaging of Melbourne invoices indicated that the courier costs were approximately $11,000.00 above the average.

3. Counsel for Qantas noted that during cross-examination Burgess was not prepared to concede that there were files in the Worldtracer system that did not incur a delivery cost.  Hardy, similarly did not concede that only a proportion of the Worldtracer files actually incurred a cost, although they did agree that the Worldtracer data did not provide a complete picture.  Counsel for Qantas submitted that Hardy stated at the hearing that Qantas would not have couriered a bag to a passenger unless a Worldtracer file was generated.

4. In further submissions of 5 April 2011 it was emphasised that the estimate for mishandled baggage was consistent with costs reflected in actual invoices and if anything an underestimate.  Although some files in Worldtracer did not have a cost attributed to them, it does not follow that no cost was incurred.  The inconvenience occasioned by customers who had to return to the airport to collect their baggage did not show as a cost for it, however such inconvenience is compensable.  If a discount is applied by the Court for files where no cost applied, that this discount should be no more than 20%.

   2.3.3The TWU’s Submissions

5. The loss related to mishandled baggage arising from the events of 30 March 2009 was $83,160.00 which is approximately 60% of the figure claimed by Qantas because a significant proportion of files, an average of 40%, incurred no cost at all. 

6. The average cost used by Burgess in her calculations included costs such as "Advance Cost", "F/Claim Cost", "Insure Cost" and "Other Cost" which are costs other than delivery, however, there was no evidence adduced which related to these costs.  Counsel for the TWU referred to exhibit WB-2 to the affidavit of Burgess (dated 1 October 2010).  The proportion of files incurring any cost in March 2009 was 62% in Sydney, 73% in Melbourne and 71% in Brisbane.  An examination of Worldtracer records revealed that there was a "substantial number" of mishandled baggage files that incurred no cost and this was not disputed by Burgess or Hardy.  The calculations undertaken by Burgess were an "inadequate" estimation when Qantas should have produced records of actual costs and remain "very substantially overstated".  Qantas did not take into account that mishandled baggage is a common occurrence and a certain level of mishandling would have occurred irrespective of the stoppage.  It was alleged that the suggestion that not all mishandled bags were recorded on the Worldtracer system is speculation on the part of Burgess and Hardy.

   2.3.4Consideration

7. Both Qantas and the TWU necessarily engaged in estimation and some speculation in arriving at the figures of $138,602.65 and $83,160.00 respectively.  The parties appeared to agree that it is not possible to arrive at a precise cost for the mishandled baggage. 

8. Qantas and the TWU do not agree about whether there were a substantial number of mishandled baggage files that did not incur costs.  At the hearing on 13 December 2010 Burgess said during cross-examination that she was not 100 per cent sure that there were no files in the Worldtracer data of the Sydney mishandled baggage that were files for which there were no costs generated:

   Mr Hatcher: …It's possible that the number 1161 for Sydney, for example, includes files for which no cost was generated?

   Ms Burgess:  No, I cannot confirm that. I would have to go back to the actual data.

   Mr Hatcher: Well, you certainly can't confirm the contrary position, that it only includes files for which a cost was generated?

   Ms Burgess:At this point in time, I can only assume that those files that were entered in there had a cost that was directly entered into the WorldTracer system.

   Mr Hatcher:  Well, you assume that, but you don't know that?
   Ms Burgess:  No, I don't know 100 percent that that would be the case.

9. Burgess did make allowance for the equivalent daily average figures for mishandled baggage by subtracting this numbers from the total.  However, she was not able to state definitely that there were no costs associated with some of the mishandled baggage.

10. For my part, I find it difficult to determine whether any measure of precision what costs Qantas incurred in delivering mishandled baggage.  I think I am able to say that the TWU's criticism of Qantas's methodology is correct.  That is, it is not possible to make an assumption that all mishandled baggage recorded on the Worldtracer system had to be delivered, at a cost to Qantas, to the passenger.  The records themselves indicate this is not so.  However I accept that the records themselves would not constitute a complete record of all mishandled baggage.  I do not accept Qantas' suggestion that if no cost was incurred in delivering baggage, somehow Qantas occasioned loss and damage in circumstances where, for example, a customer had to return to the airport to collect baggage or wait around at the airport for their baggage.  I prefer the TWU's estimate and accordingly will order it to pay Qantas $83,160 to remedy this aspect of the effect of the industrial action.

    2.4             Accommodation

    2.4.1Evidence

11. As a result of the industrial action on 30 March 2009 Qantas had to provide accommodation to passengers who had had their flights delayed or cancelled or had missed connecting flights.  Evidence on accommodation costs incurred as loss and damage was given by Burgess, Simmons and Burton.

    2.4.2Qantas' Submissions

12. As a result of the stoppage on 30 March 2009 it became necessary to provide overnight accommodation to a number of passengers in Australia whose flights had been delayed.  It should be noted that accommodation costs for Qantas passengers overseas is separately dealt with in this judgment.  The total amount sought is $34,787.87 and relates to accommodation provided for affected passengers in Sydney, Adelaide, Melbourne and Brisbane who either were delayed boarding flights directly affected as a result of the stoppage or were unable to board unaffected connecting flights as a result of their flights being delayed.

    2.4.3The TWU's Submissions

1. The TWU does not dispute Qantas' claim for accommodation costs within Australia as a result of the stoppage on 30 March 2009.

   2.4.4Consideration

2. I propose to order that the TWU pay Qantas $34,787 to remedy this aspect of the effect of the industrial action.

   2.5             Transport

   2.5.1Evidence

3. This matter concerns costs associated with transporting passengers affected by the events of 30 March 2009.  Burgess gave evidence about transport costs incurred by Qantas transporting passengers between airports and between airports and hotels (and vice versa).  Patricia Kop (Qantas airport manager SIT) and Matthew Morris (Qantas business manager baggage at SIT) gave evidence relating to the SIT domestic transfer lounge and its use for storing luggage on 30 March 2009.  Buses were chartered and cabcharges were given to transport passengers who had been affected by the stoppage.  The invoices for these costs were to be found at exhibit WB-8 to the affidavit of Burgess.

   2.5.2Qantas’ Submissions

4. As a result of the stoppages on 30 March 2009 it became necessary for it to transport passengers between airport terminals, hotels and their homes.  There are four invoices evidencing the costs incurred.  The total of the various invoices is $18,705.50 (including GST).

5. The first invoice in the exhibit is from Murrays Coaches in the sum of $15,225 (including GST) from a number of services provided between 30 March 2009 and 1 April 2009.  These costs were incurred as a result of baggage having to be stored in the Qantas Domestic Transfer Lounge at SIT resulting in passengers being unable to use the facility and had to be transported to SDT on specially chartered buses.  Kop described the seamless transfer area as "being full of bags".  The seamless transfer area is where Qantas passengers coming off international flights at SIT go to be transported to domestic flights at SDT.  When an invoice from an independent third party records the costs as arising from an industrial stoppage, the court should accept that the costs have come as a consequence of that stoppage.

6. The second invoice is from Austlyn Tours and relates to events at Brisbane Airport where passengers were transported to hotels and back.  The invoice itself relates to a period of 30 days and only a number of the services relate to the effects of the stoppage.  Although not clear from the invoice the cost it incurred as a result of the stoppage was $1,384.50.  The third invoice is from the Qantas Group and relates to a coach chartered at Perth Airport in relation to flights QF565/575 and totals $1,600 (including GST).  The fourth invoice is from Cabcharge and Qantas say that of the total invoice $496.00 is as a result of the stoppages on 30 March 2009.

   2.5.3The TWU’s Submissions

7. There is no rational basis as to why it would be inferred that Murrays coaches were contracted between 30 March 2009 and 1 April 2009 as a result of the stoppages of work and submitted there was no direct evidence given by any of Qantas' witnesses as to why the contacting of the buses had anything to do with the stoppages.  Despite the notation of "TWU Strike" on the invoice, the costs incurred by Qantas could not have been a result of the stoppage on 30 March 2009, as no direct evidence was given by any Qantas witness as to why the contracting of Murrays coaches at SIT was necessary as a result of the stoppage.  As a result, the costs attributable to the stoppage on 30 March 2009 could be at most only $3,480.50, that is, the total of the remaining three invoices.

   2.5.4Consideration

8. I am satisfied, for the reasons advanced by Qantas, that that the amounts claimed represents costs incurred by Qantas in dealing with the events of 30 March 2009.  The TWU should be ordered to pay Qantas $18,705.50 to remedy this aspect of the effect of the industrial action.

   2.6             Meal Vouchers

   2.6.1Evidence

9. Because of the events of 30 March 2009, many passengers were unable to travel at the time their flight was scheduled to depart.  They had to wait at the airport.  In those circumstances Qantas provided many passengers with meal vouchers redeemable at food outlets within the airport.  Many of these vouchers were used by the delayed passengers to purchase food and beverages.  Qantas incurred a cost by paying the food outlets an amount equivalent to the value of the redeemed vouchers.  Subject to one argument advanced by the TWU (that Qantas was not contractually bound to provide these vouchers) the provision of the vouchers was an effect of the industrial action which can be remedied by an order that the TWU pay Qantas an amount equal to the costs incurred.

10. Burgess gave evidence about the meal vouchers provided by Qantas.  They were provided when there is a major delay in operations and are generally in the amount of $15.00 or $20.00.  The meal vouchers are small different coloured tickets that passengers may redeem at shops or cafes in the airport in exchange for food and beverages.  When the vouchers are redeemed, Qantas received invoices from the shops and cafes for the cost of food or beverage purchased.  Exhibit WB-8, attached to Burgess' affidavit contained a copy of such invoices from outlets in Sydney, Adelaide, Perth and Ayers Rock.  The invoices were provided to Burgess by the financial controllers at the relevant airports "as being costs that were causally connected to the stoppage".  At the hearing on 13 December 2010, Burgess explained that the vouchers had a time limit on their use in that they were linked to specific flights and in most cases the voucher needed to be spent before the flight took off.

    2.6.2Qantas' Submissions

11. The evidence in exhibit WB-8 demonstrated that total cost of meal voucher expenses arising from the stoppage on 30 March 2009 was $47,400.10.  The costs of the meal vouchers were incurred in trying to mitigate the impact of the respondents' conduct and it is not necessary for a contractual obligation to exist.  The meal voucher costs claimed were based on invoices received from retail outlets not on the face value of the vouchers.  The costs relating toflights not listed as delayed on the day were explained by the evidence of Paul Nicholas (Qantas general manager business services) as caused by consequential delays.  The evidence of Burgess, Hardy (affidavit dated 14 December 2010) and Crippin (affidavit dated 13 December 2010) were that these costs were causally connected to the stoppage.  There should not be a discount in relation to the cost of meal vouchers.

    2.6.3The TWU’s Submissions

12. The TWU submitted "no loss or damage has been proven with respect to Qantas meal vouchers arising from the events of 30 March 2009".  The difficulties with the amount claimed by Qantas for meal vouchers were said to be:

    ·Qantas had no contractual or other obligation to issue meal vouchers.  The costs incurred were the result of a voluntary decision made by Qantas.

    ·No attempt was made by Qantas to ascertain the costs they actually incurred.  The amount claimed was the face value of the vouchers not the amount actually spent by passengers (this submission was incorrect).

    ·Qantas did not provide positive evidence linking the invoices in exhibit WB-8 to 30 March 2009.  Some of the invoices refer to 5 April 2009 or even October 2008 and the Adelaide invoice refers to flights which are not listed as delayed on the day.  None of the witnesses were able to explain the relationship between the dates of the invoices and the stoppage on 30 March 2009.

    2.6.4Consideration

13. I do not accept the TWU's submission that because Qantas was under no contractual obligation to provide meal vouchers, their provision is not a compensable "effect" of the industrial action. If it was a settled practice of Qantas (which I infer it was), and perhaps even an industry practice, to provide meal vouchers in the circumstances arising on 30 March 2009 involving significant delays to the departure of aircraft, then their provision was an "effect" of the industrial action.  It was not suggested in cross examination of Qantas' witnesses that it was not a settled practice or was, in some way, an unreasonable one.

14. As to the TWU's complaints about specific invoices, I accept that some are justified in the sense that they raise sufficient doubts about the invoices to warrant the amounts not being included.  One example is an invoice from Airport Fine Foods Pty Ltd.  While the invoice is dated 2 April 2009 it, in terms, relates to meal vouchers (totalling $540) apparently either dated or redeemed in October 2008.  Also invoices which do not, in terms, refer specifically to 30 March 2009 or 31 March 2009 raise sufficient doubt about the amounts included (at least in the absence of evidence what the usual daily or weekly cost of providing vouchers was) to warrant them not being included.  Such vouchers total a little over $2000.  An invoice concerning Adelaide was challenged by the TWU on the basis that the flights referred to were not delayed though the invoice does use the word "Delayed".  It is probable meal vouchers were issued in Adelaide and I am prepared to accept that the sum of approximately $1,200 on this invoice should be included.

15. In the result, the TWU should be ordered to pay Qantas $44,860 to remedy this aspect of the effect of the industrial action.

    2.7             Flight delays

    2.7.1Evidence

16. Qantas provides baggage handling and other ramp services to a number of other domestic and international airlines in Australia.  As a result of the industrial action on 30 March 2009, Qantas was unable to provide these services so as to enable the client airlines to operate on schedule. Their flights were delayed. Because of this Qantas waived ground handling fees it may have otherwise been entitled to from those airlines.  Evidence on service delays to client airlines who were not provided with ground handling services in a timely way was given by Burgess.

    2.7.2Qantas' Submissions

17. Burgess gave evidence about Qantas' contractual arrangements to provide ground handling services for a number of client airlines at a number of Australian airports.  As a result of the stoppage a number of these client airlines suffered significant delays because they did not have ground handling services provided to them.  Burgess gave evidence that in an effort to maintain good commercial relations with these client airlines Qantas waived charging of ground handling fees to these airlines for 30 March 2009.

18. Exhibited to Burgess' first affidavit is a spreadsheet detailing the waived ground handling fees on 30 March 2009 totalling $42,092.89.  Of this amount, $12,631.89 was waived for QantasLink, a wholly owned Qantas subsidiary and $29,641 was waived for other third party client airlines.  The exact details of the amounts waived to each client airline have not been provided as the information is commercially sensitive.  The waving of ground handling fees was loss and damage suffered by it as a result of the stoppage on 30 March 2009.

    2.7.3The TWU's Submissons

19. Any decision made by Qantas to waive ground handling fees was voluntary and did not arise from any contractual obligation.  This was confirmed in cross-examination by Burgess who agreed that the decision to waive ground handling charges for client airlines was made voluntarily.  Further, QantasLink is a wholly owned Qantas subsidiary and there can be no justification for waving the respective ground handling fees.  No loss or damage has been proved by Qantas as a result of the stoppage on 30 March 2009.

    2.7.4Consideration

20. As with the meal vouchers, I do not accept the TWU's submission that because Qantas was under no contractual obligation to waive ground handling fees, their waiver is not a compensable "effect" of the industrial action.  If it was a settled practice of Qantas (which I infer it was), and perhaps even an industry practice, to waive ground handling fees in the circumstances arising on 30 March 2009 involving delays in the departure of client airlines' aircraft, then their waiver was an "effect" of the industrial action.  It was not suggested in cross-examination of Qantas' witnesses that it was not a settled practice or was, in some way, an unreasonable one.  For the reasons given by Burgess, Qantas had a commercial interest in waiving the fees for QantasLink.  The amounts waived represent income directly foregone. The TWU should be ordered to pay Qantas $42,092 to remedy this aspect of the effect of the industrial action.

    2.8             Flight Interruption Manifests

    2.8.1Evidence

21. Circumstances can arise when Qantas is unable to transport a passenger on a scheduled flight and arranges for the passenger to travel on another airline.  Qantas incurs a cost.  Evidence on Flight Interruption Manifests ("FIMs") was given by Ian Alfred (Qantas manager interline settlement) in his affidavit sworn on 12 December 2010, and by Burgess in her affidavit sworn on 1 October 2010.

    2.8.2Qantas' Submissions

22. Alfred gave evidence that when a disrupted passenger is placed on a flight on another airline, a FIM is prepared.  Qantas is then charged a fee by the other airline for flying a passenger on its service.  The International Air Transport Association regulates how much airlines can charge each other for carrying each other's passengers.

23. As a result of the industrial action on 30 March 2009 and delays or cancellations of flights QF1, QF5, QF11, QF19, QF21, QF41, QF47, QF73, QF93, QF107, QF108, QF301, QF418, QF440 and QF730 a total of 186 FIMs were issued by it.  Alfred calculated the total cost of the FIMs billed to it and subtracted the amounts that were recovered by it to give a total loss of $73,796.72 relating to FIMs as a result of the stoppage on 30 March 2009.  TWU do not take issue with this figure.  It should be accepted.

    2.8.3The TWU's Submissions

24. The TWU does not take issue with the calculations provided by Alfred and ultimately relied on by Qantas.

    2.8.4Consideration

25. The TWU should be ordered to pay Qantas $73,796 to remedy this aspect of the effect of the industrial action.

    2.9             Miscellaneous costs

    2.9.1Evidence

26. Burgess in her affidavit of 1 October 2010 explained that the miscellaneous costs arising as a result of the industrial action on 30 March 2009  related to the following:

    In Sydney, the costs relate to a bag order machine that was hired from Menzies Aviation to screen baggage, labour costs associated with disruption staff engaged through Blue Collar Recruitment, and cash provided to customers to purchase emergency supplies because their baggage was not delivered in a timely fashion.

    In Perth, the costs relate to additional baggage screening that was required on the day of the stoppage.

    In Adelaide, the costs relate to cash provided to customers to purchase emergency supplies because their baggage was not delivered in a timely fashion.

    The copy of the invoices relied on by Burgess were included in exhibit WB-16.

    2.9.2Qantas' Submissions

27. The evidence of Burgess in relation to miscellaneous costs should be accepted.  The total cost of miscellaneous expenses was $48,215.50 (including GST).  All the Australian Quarantine and Inspection Service invoices recorded on their face that they were invoices in relation to the stoppage on 30 March 2009 and as such it should be concluded that the costs were incurred as a result of the industrial stoppage.  Invoices were usually only received from the Department of Agriculture, Fisheries and Forestry when there is a specific quarantine issue in relation to baggage or as in this instance when additional staff had to be called outside their normal operating hours.  It did not accept that the cash advances had already been included in Worldtracer and relied on the evidence given by Burgess at the hearing on 13 December 2010.  The evidence of Burgess and Hardy demonstrated that the cash advances related to the day of the stoppage.

28. No discount should be allowed for miscellaneous costs.  The questions raised by the TWU in relation to whether these charges related to the events of 30 March 2009 were answered as follows:

    ·The industrial action caused ongoing disruption for a number of days and the losses flowed from this.

    ·The evidence of Burgess was that it took at least five days to clear the backlog of baggage.

    ·The invoices submitted relating to the cash advances on their face are attributable to the stoppages even if they have not been entered in Worldtracer.

    2.9.3The TWU's Submissions

29. There was no evidence linking the miscellaneous costs to 30 March 2009.  It would be assumed that cash advance costs were entered in Worldtracer because this is the system used by Qantas to trace mishandled baggage and record associated costs, including cash advances to customers.  The Qantas claim involves "double counting" because it is claiming costs on specific invoices as well as compensation based on the average cost per mishandled baggage which includes the cash advances.

30. The TWU submitted that the miscellaneous costs would be $27,298.57, excluding the cash advance amounts.  Burgess did not know whether the particular costs had been entered into Worldtracer and at the hearing she did not dispute that these costs were generally entered into the system.  Qantas did not call any evidence to support Burgess' assertion that the amounts on the invoices related to 30 March 2009.

    2.9.4Consideration

31. In so far as the cash advances are concerned, the documentary evidence relied on was invoices from Travelex (in the multiple thousands of dollars) or records about much smaller amounts concerning individual customers.  What Qantas has not demonstrated (beyond asserting that it was not necessarily the case) is that these amounts are not already included in the information extracted from the Worldtracer (which included cash advances) which forms the basis of the calculations concerning costs occasioned by mishandled baggage.  Unless I am satisfied there has been no double counting (and I am not) I propose to include under this head (Miscellaneous costs) the amount of $27,298.  I am satisfied that this amount does relate to costs Qantas incurred in taking steps to deal as quickly as practicable with the consequences of the delay in handling baggage on 30 March 2009.  The TWUs should be ordered to pay Qantas $27,298 to remedy this aspect of the effect of the industrial action.

    2.10           Offshore losses

    2.10.1Evidence

32. A number of Qantas flights to and from Australia and overseas were delayed or cancelled as a result of the stoppage on 30 March 2009.  Qantas incurred a number of additional costs as a result of the stoppage including having to provide meals and refreshments, accommodation, transport and telephone access to affected passengers and crew, having to deliver mishandled baggage to affected passengers, having to provide extra labour at overseas ports, pay for extended aircraft parking and pay for ground handling services for flights that were cancelled.  Evidence on loss and damage suffered by Qantas in relation to overseas airports was given in chief by Cheryl Noorbergen (Qantas head of business performance and control).  Noorbergen's evidence relied on evidence from Nicholas and Kirstan Knight (Qantas financial controller cabin crew) relating to foreign exchange rates and international flights delayed as a result of the stoppages.  All monetary amounts in this section are in AUD, unless otherwise stated.

    2.10.2Qantas’ Submissions

33. As a result of the stoppage on 30 March 2009, Qantas suffered what it describes as "offshore losses" relating to loss and damage at a number of overseas airports.  In total, the cost it incurred at these overseas airports is $132,063.68 not including the amount sought in relation to FIMs and can be broken down port by port as follows:

    (a)Christchurch  $2,229.80;

    (b)Auckland  $6,127.36;

    (c)Los Angeles (excluding FIMs)             $13,891.23;

    (d)New York (excluding FIMs)  $13,419.94;

    (e)Hong Kong  $25,138.77;

    (f)Bangkok  $3,349.36

    (g)Singapore  $10,597.74;

    (h)Shanghai (excluding FIMs)  $2,768.34;

    (i)Beijing  $3,471.25;

    (j)Manila  $2,911.80;

    (k)Indonesia  $7,022.08; and

    (l)Johannesburg  $41,136.01.

    It is necessary to consider each of these locations separately.

1. Hyams gave evidence about a number of customer complaints received by it from passengers who were affected by the events of 2009.  Hyams gave evidence that he received a number of complaints from passengers who had had their travel affected by the stoppage who said that they would not fly with it again, would choose to fly with competitor airlines in future or would not recommend Qantas to others.

2. Nicholson gave evidence about customer satisfaction surveys, and in particular the effect that delayed flights had on a passenger’s willingness to travel with it again.   Exhibited to affidavits were results of surveys undertaken by it comparing delay length to flight satisfaction as well as likeliness to fly with it again.  The data used to create these graphs was collected from the period March 2009 to April 2010 surveying approximately 50,000 passengers.  The delays to flights as a result of the industrial stoppage were significantly long enough to give rise to impacts upon affected passengers' overall flight satisfaction, willingness to fly with it again and willingness to recommend it to others.  This was more apparent in relation to domestic travel than international and it contended that the average delay time of 87 minutes to flights affected by the industrial stoppage on 30 March 2009 could give rise to these effects.

   2.18.3The TWU's submissions

3. The claim by Qantas relating to damage done as a result of the industrial stoppage to its brand and reputation must fail as it is not based on any pecuniary loss established on evidence led by Qantas.

4. Nicholson's evidence shows delays to international flights have no significant effect on a passenger’s likelihood to fly Qantas again.  When this was put to Nicholson in cross-examination, he agreed that based on the chart, this was correct and it was generally a practice of Qantas not to survey international passengers when a flight was delayed for over two hours.  In respect of the domestic surveys, the TWU contended that Nicholson’s results come from a period of more than 12 months from March 2009 to April 2010, rather than from 30 and 31 March 2009 and are based on how a customer felt at the time of the delay but say nothing about whether or not the passengers who were affected by the industrial stoppage did or did not fly Qantas again in the future.

5. The respondents put into evidence Qantas' 2009 Annual Report.  In fact, Qantas increased its passenger numbers, revenues and profits and no damage was done to its brand and reputation as a result of the 30 March 2009 industrial stoppage.

6. Any compensation to Qantas under the heading "Brand and Reputation" would constitute double counting absent any evidence of ongoing loss of trade or profits.  This submission is made on the basis that Qantas have already in detail sought to recover every item of loss that occurred as a result of the industrial action.  No compensatory order should be made for this head.

   2.18.4Consideration

7. I accept the TWU's submissions.

   2.19           Time to Pay and Interest

8. The TWU sought six months in which to pay compensation ordered if it was a significant sum. It is. This was opposed by Qantas. No evidence was led by the TWU to establish it could not pay any amount which might be ordered within any particular time frame. However, given the magnitude of the sum the TWU will be required to pay, I propose to order that it make payment within two months of the date of the order. Notwithstanding the delay of two months significant protection is afforded to Qantas by s 52 of the Federal Court of Australia Act 1976 (Cth) ("FCA Act").

9. As to pre-judgment interest, I see no reason not to make an order under s 51A of the FCA Act. I propose to do so.

   3.               PENALTIES

10. Before considering what penalties should be imposed on each of the individual respondents who I have held contravened s 494 in the liability judgment, it is necessary to focus more carefully on how the contravening conduct engaged s 494 and also necessary to refine observations I made in that judgment. That is because an issue has now arisen about whether an individual's participation in the meeting of 25 March 2009 (involving Sheldon, Connolly and Gallacher) constituted one or four contraventions of the section. The starting point for this analysis is obviously the terms of s 494 itself. It spoke of "organise or engage in industrial action". I think fairly clearly the section comprehended conduct of two types: as to the construction of an expression of this character in a section which may create one or a number of offences see, for example, Linehan v Australian Public Service Association (Fourth Division Officers) (1982) 66 FLR 90 at 109-110. The first is organising industrial action and the second is engaging in it. By penalising this conduct, the WR Act was endeavouring to stop industrial action occurring during the currency of a collective agreement. That purpose would be best achieved by treating the section as prohibiting the organising of industrial action whether or not, in fact, it occurred and also prohibiting conduct constituting industrial action if it did occur. Doing either would constitute a contravention of the section. Doing both would involve two contraventions of the section. The difficulty in applying these general statements in the present case arises in the following way.

11. As I mentioned in the liability judgment, the expression "engaging in industrial action" picked up s 4(5) and s 728 and those provisions (and in particular the latter) gave extremely wide content to the expression. Because of this wide content the Ombudsman made a submission that, as I understood it, even though the conduct of each individual on 25 March 2009 of attending the meeting and making certain decisions was one act of organising, because the industrial action on 30 March 2009 can be viewed as four instances of industrial action (an instance at each airport), the very same conduct involved "engag[ing]" in these four instances of industrial action. This conduct therefore entailed four contraventions of s 494 and exposed each individual to four penalties for what they did on 25 March 2009. I do not accept this.

12. If, as I think is the case, the section comprehended conduct of two types then the question must arise whether the expression "engage in" was, in a context where "organising" was separately dealt with, intended to comprehend conduct which is, in substance, the same. Both s 4(5) and s 728 were, in effect or at least analogous to, definition sections in the sense that they supplemented and gave content to words describing conduct elsewhere in the Act. Their application in any particular context must be consonant with that context. It seems to me the operation of both sections in s 494 must accommodate the fact that "organising" is separately dealt with in that section. That would be achieved, as a matter of construction, by treating the operation of both sections as not yielding the result that organising industrial action was also engaging in industrial action. The rationale for doing so is much like the modification, as a matter of construction, of the operation of a definition if the context requires it: see Pierce DC and Geddes RS, Statutory Interpretation in Australia (6th ed, Lexis Nexis, 2006) at 6.62. The conduct of Sheldon, Connolly and Gallacher on 25 March 2009 involved one contravention by each of s 494.

13. Even if the construction of s 494 founding the Ombudsman's analysis was correct I very much doubt that it would be appropriate to treat the events of 30 March 2009 as four instances of industrial action and then work backwards, as it were, to impute to each of the participants in the meeting four separate acts of engaging in that conduct giving rise to four contraventions by each of the participants in the meeting of 25 March 2009. It would, in my opinion, be a perverse result. But even if it is an available analysis the characterisation of the four contraventions by each participant as a course of conduct attracting one penalty is irresistible: Construction, Forestry, Mining and Energy Union v Williams (2009) 262 ALR 417.

14. This conveniently leads to a consideration of whether for Sheldon what he did on 25 March 2009 together with what he did on 30 March 2009 was, for the purposes of considering the imposition of a penalty, one course of conduct. Sheldon organised the industrial action when he participated in the meeting on 25 March 2009, he did so again on the morning of 30 March 2009 at the Rowers Club and then engaged in the industrial action (having regard to its extended meaning and the effect of s 728) by speaking at the meeting at SIT. I noted at [361] in the liability judgment that in making the decision on 25 March 2009 to hold meetings at the various airports Sheldon knew that the likely sequence of events to unfold were the events which in fact occurred. That was the essence of his conduct that day which attracts s 494. What he did on 30 March 2009 was to perfect or give effect to the decision which had been earlier made. Doing so added little or nothing to the gravity and effect of the decision he was involved in making six days earlier. His conduct on 25 March 2009 and his conduct on 30 March 2009 were similar and had a common purpose, and to use the language of Lord Diplock in Director of Public Prosecutions v Merriman [1973] AC 584 was conduct which "could fairly be regarded as forming part of the same transaction or criminal enterprise". I proposed to treat the contravening conduct of Sheldon as one course of conduct.

15. The matters which may be considered in imposing a penalty have been articulated in many judgments of this Court by both single judges and Full Courts.  One authority of a single judge which is often cited is the judgment of Branson J In Construction, Forestry, Mining & Energy Union v Coal & Allied Operations Pty Ltd (No 2) [1999] FCA 1714; 94 IR 231 and, more recently, the judgment of Tracey J in Stuart-Mahoney v Construction, Forestry, Mining and Energy Union (2008) 177 IR 61; [2008] FCA 1426 at [40]. Sheldon was a senior and influential official in the TWU. He was a leader. His support at the meeting of 25 March 2009 for the decision to hold meetings on 30 March 2009 would doubtless have been important in securing that result. Because Sheldon knew that what was likely to occur was what in fact occurred, he probably knew that taking the decision was unlawful conduct (this appears near enough to having been conceded in cross examination when he agreed he appreciated that the union and employees are prohibited from taking industrial action during the currency of an EBA), he knew that the decision and giving effect to it was likely to lead to enormous disruption to domestic and international air traffic, very great inconvenience to the travelling public and financial harm, and potentially significant financial harm, to Qantas.

16. At the commencement of the liability judgment I referred to Qantas' objective of reducing labour costs and the TWU's objective of retaining jobs and existing incomes and conditions of employment. From Qantas' perspective its objective is doubtless viewed as a legitimate commercial one. However equally, from the TWU's perspective, its objective is a legitimate industrial one. Regrettably, the TWU led by Sheldon, elected to pursue its objective by unlawful means. The evolution of Commonwealth industrial law has resulted in the statutory legitimisation of industrial action but only in certain circumstances. The WR Act, as at 30 March 2009, marked out the circumstances prevailing on that day for baggage handlers and other ramps staff employed by Qantas, as circumstances in which industrial action could not be taken. The contravention by Sheldon was a serious one though it is his first contravention. The penalty should have a specific and general deterrent effect. Sheldon has shown only limited contrition. The respondents repeat the expression of contrition advance before Besanko J in Fair Work Ombudsman v Transport Workers’ Union of Australia [2010] FCA 768 at [29]-[30]. His Honour accepted this was an expression of contrition. I do likewise though I note there is no expression of contrition about damage caused to Qantas. The common expression of contrition is limited to inconvenience caused to the travelling public. The maximum penalty which can be imposed on individuals is 30 penalty units ($6600). The seriousness of Sheldon's contravention should be reflected in the penalty. I proposed to impose a penalty within the upper range, namely $5,000.

17. In relation to Gallacher, much the same as appears in the preceding paragraph can be said of him. He was the President of the TWU. He was a leader. However his participation in the meeting of 25 March 2009 was the only conduct he engaged in contravention of s 494. He no longer is a union official so the need for specific deterrence is less though I do not accept that this factor (or any other factor) should lead to no penalty being imposed. I propose to impose a penalty of $4,000.

18. In relation to Connolly, the observations I made about Sheldon's participation in the meeting of 25 March 2009 apply, with one qualification, to him.  He had a significant role in relation to the representation of the membership in the airline industry and in the events which culminated in the industrial action on 30 March 2009.  While in that sense he had a leadership role, it was not of the same character as Sheldon.  While his views at the meeting on 25 March 2009 would have been important, I doubt that they would have been as influential as those of Sheldon. Like Sheldon, Connolly also engaged in contravening conduct on 30 March 2009.  Also, for the reasons given in relation to Sheldon, Connolly's conduct on 25 March 2009 and 30 March 2009 should be treated as the one course of conduct.  He has shown limited contrition. This is his first contravention.  I accept, as Qantas submitted, that as an aggravating factor (and this is true of Burton and Loader as well)  he was in a position to engage in the contravening conduct because his entry to the airport and ability to conduct a meeting was facilitated by Qantas.  The penalty should have a specific and general deterrent effect.  I proposed to impose a penalty of $3000.  All the factors which influenced my determination of the penalty for Sheldon are applicable to Connolly save for his leadership role.

19. Pieri attended the meeting at the Rowers Club and orchestrated the attendance of members at the meeting in front of SIT.  Again, to use the language of Lord Diplock in Director of Public Prosecutions v Merriman it was conduct which "could fairly be regarded as forming part of the same transaction or criminal enterprise".  I propose to treat the contravening conduct of Pieri as one course of conduct.  Having regard to the conclusions reached in the liability judgment about Pieri's conversation(s) with Tenkate (see, in particular, [118]), Pieri knew at the beginning of the day on 30 March 2009 that events were likely to unfold as they did.  While his conduct concerned only Sydney, he knew that there would be serious disruption at a major international airport in Australia with the consequences for the travelling public and Qantas discussed earlier in relation to Sheldon.  Pieri was instrumental in creating the circumstances which led to that disruption. It is his first contravention.  He has shown limited contrition.  The penalty should have specific and general deterrent effect.  I proposed to impose a penalty of $2,500.

20. Burton's position is slightly different.  The office he held within the TWU was not of the same order as those held by Sheldon, Gallagher and, to a lesser extent, Connolly.  But his local influence was doubtless significant.  While he had not been one of the architects of the industrial action Australia wide, he failed, in Perth, to ensure a skeleton crew was in place and used inflammatory language. He knew that once everyone was in the lunchroom they would probably be docked four hours pay.  In other words, Burton had more than an inkling that what occurred in Perth, would occur.  He facilitated its occurrence.  It is his first contravention.  He has shown limited contrition.  Again, the penalty should have a specific and general deterrent effect.  His responsibility for their serious consequences of the industrial action concerns its effects only in Perth.  This is, I think, relevant. I proposed to impose a penalty of $2,000 on Burton.

21. Loader's position is different yet again.  What I have said about the office Burton held, applies equally to Loader.  His contravening conduct was less egregious in the sense that he commenced to conduct the meeting in the normal way and was not initially intent on causing disruption.  When disruption did occur he persisted with the meeting and used inflammatory language.  He had no broader role.  It is his first contravention.  He has shown limited contrition.  He no longer holds office within the TWU and this is relevant to specific deterrence.  His responsibility for the serious consequences of the industrial action concerns its effects only in Adelaide.  Again, I think this is relevant. I proposed to impose a penalty of $1,500 on Loader.

22. The TWU is, by statute, vicariously liable for each of the contraventions discussed to this point as well as the contravening conduct of delegates who requested members to attend each of the meetings.  Probably this is best treated as six contraventions.  Whether this is correct, however, probably does not much matter as I view all the contraventions as part of the same course of conduct by the TWU.

23. In organising the meeting on 25 March 2009 and in making the decision to hold the meetings, the TWU can be taken to have had the same understanding of what was likely to occur as the participants.  In other words, the die was cast by the taking of the decision.  All other acts imputed to the TWU to give effect to the decision did no more than bring about what the decision makers contemplated would occur.  The TWU can be treated as having known that taking the decision was unlawful conduct and that the decision and giving effect to it was likely to lead to enormous disruption to domestic and international air traffic, very great inconvenience to the travelling public and financial harm, and potentially significant financial harm, to Qantas.  Yet again, to use the language of Lord Diplock in Director of Public Prosecutions v Merriman all other acts imputed to the TWU constituted conduct which "could fairly be regarded as forming part of the same transaction or criminal enterprise".

24. The only matter additional to those I have discussed in relation to individual respondents which is relevant to determining penalty is the fact that the TWU has been found to have twice contravened the Act by a judge of this court (Besanko J in the judgment referred to earlier) and once by a Federal Magistrate ([2010] FMCA 826). The contravening conduct occurred respectively on 12 December 2007 and 16 February 2009 and the judgments were given on respectively 23 July 2010 and 2 November 2010. The respondents submitted that because no determination had been made as at 25 and 30 March 2009 that the conduct was contravening conduct, the fact of contravention should not be brought to account at least as a significant element in determining the extent of the need for specific deterrence. There is some force in this submission though equally (in the absence of findings that the earlier contraventions were inadvertent) the fact of prior contraventions seems to me to be relevant.

25. The maximum penalty for any contravention by a corporation is 600 penalty units, which is presently $33,000.  The TWU's contravention was serious for the reasons I have discussed in relation to individual respondents and Sheldon in particular. I propose to impose a penalty of $20,000.  The respondents made a submission that the fact they will also be ordered to pay Qantas a considerable sum to remedy the effects of the contravening conduct should influence the amount of the penalty.  I regret to say that for my part I do not see any principled basis for doing so.  The sum to remedy the effects of the contravening conduct serves that very purpose.  The payment to Qantas of the penalties serves another and quite distinct purpose, namely to encourage individuals to bring, in appropriate circumstances, proceedings of this type.

1. I have concluded that an order should be made that the penalties be paid to Qantas and not into consolidated revenue as submitted by the Ombudsman.  The former approach was advanced by Qantas and supported by the respondents.  There is a practical reason for taking this approach as well as a reason founded on principle.  The practical reason is that the penalties should be imposed in the Qantas proceedings given that two respondents (Pieri and Gallacher) to those proceedings who will be ordered to pay penalties are not respondents in the Ombudsman proceedings.  As a practical matter, this rather suggests that any order directing the penalties to be paid to the prosecutor should be in favour of Qantas.  As to principle, the rationale for making such an order (adverted to briefly in the preceding paragraph) was discussed by Finkelstein J (putting aside his Honour's observations about windfalls) in CPSU, The Community and Public Sector Union v Telstra Corporation Ltd (2001) 108 IR 228 at 232 and see also Rojas v Esselte Australia Pty Ltd (No 2) (2008) 177 IR 306 at 326 together with the judgment of the Full Court (and cases cited therein) in Plancor Pty Ltd v Liquor Hospitality and Miscellaneous Union (2008) 171 FCR 357. Qantas has assumed the organisational and financial burden of prosecuting those proceedings and, in those circumstances, it is appropriate penalties be paid to it. I understood the Ombudsman to accept that if I reached this conclusion that I should order that his proceedings be dismissed.

2. Qantas seeks declaratory orders declaring what the contravening conduct of each of the respondents was. For my part, I do not see the need to make such orders. I hope I have described with sufficient clarity and precision in these and the earlier reasons what each respondent did that was conduct contravening s 494. That, I think, is sufficient in the circumstances.

   4.               COSTS

   4.1             Submissions on costs

3. It was not an issue that, as a general proposition, what costs orders may be made in these proceedings is governed by s 824 of the Act. That section provides:

   (1)       A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) must not be ordered to pay costs incurred by any other party to the proceeding unless the first mentioned party instituted the proceeding vexatiously or without reasonable cause.

   (2)       Despite subsection (1), if a court hearing a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) is satisfied that a party to the proceeding has, by an unreasonable act or omission, caused another party to the proceeding to incur costs in connection with the proceeding, the court may order the first-mentioned party to pay some or all of those costs.
   (3) In subsections (1) and (2):

   costs includes all legal and professional costs and disbursements and expenses of witnesses.

4. While accepting that generally Qantas could not be ordered to pay their costs (which, s 824 aside, would have been unlikely given that the respondents failed in their defence of a central element of the proceedings), the respondents nonetheless sought special costs orders in relation to the proceedings in so far as they concerned the respondents Spring and Magree and also a special costs order arising from the unsuccessful case alleging nuisance as well such an order in relation to the unsuccessful case under the Trade Practices Act.

5. I think I can deal briefly with the respondents' argument that a costs order can be made in their favour in relation to Qantas' Trade Practices Act claim which did not succeed. It was submitted there was power make a costs order (and it should be made because costs follow the event) because s 824(1) had no application to a claim under another federal law even if brought in proceedings making a claim under the Workplace Relations Act. Bahonko v Sterjov (2008) 166 FCR 415 was said to establish this limit on the reach of s 824. I disagree. The Full Court was, in that matter, dealing with a most unusual situation. It had before it two proceedings. Though they had been consolidated, they remained separate proceedings. Accordingly only one of the proceedings attracted the operation of the section limiting the power to award costs. The other was unaffected in the sense that the section had no application to it. It was in those latter proceedings that the unconstrained discretionary power to award costs could be invoked. The judgment stands for nothing more notwithstanding the width of some of the language used. The orthodox approach, as I apprehend it, is that s 824 operates in relation a proceeding in which any claim is advanced as part of a matter constituted by the entire controversy between the parties to that proceeding. I think so much is apparent from at least the judgment of Black CJ and Jessup J in Goldman Sachs JBWere Services Pty Ltd v Nikolich (2007) 163 FCR 62 at [86] and [380] respectively.

6. In so far as the respondents Spring and Magree were concerned, the gravamen of the argument was that from the outset there was no case of substance at all which could be maintained against either of them, but Qantas persisted in its case against both of them. In summary, the circumstances relied on by respondents were these. In relation to Spring, Qantas ultimately abandoned the case but only after a no case submission was foreshadowed, a letter written and submissions prepared and forwarded to Qantas' lawyers. In relation to Magree, Qantas did not resile from prosecuting its case against him notwithstanding that, it was submitted, at the end of the day there was no evidence on which a finding of contravention of s 494 might be made against him and there never had been (at least on the facts alleged in a statement of facts prepared by Qantas). Again a letter had been earlier written inviting Qantas to discontinue the proceedings against Magree.

7. The respondents submitted these circumstances engage both the proviso in s 824(1) (institution of proceedings without reasonable cause) and the precondition for an order under 824(2) (the prosecution or continued prosecution of the case against them (particularly after correspondence was exchanged in December 2010 about the position of both) was an unreasonable act). They noted that it has been held that an application that had no substantial prospect of success is incompetent or hopeless would be comprehended by the expression "without reasonable cause": Imogen Pty Ltd v Sangwin (1996) 70 IR 254 at 257. For my part, I accept that the proceedings against Magree and Spring were barely justified certainly with the benefit of hindsight and that Qantas could have brought a greater measure of judgment to bear in identifying respondents. However I accept, as Qantas submitted, in relation to Magree that there are observations in some authorities which would suggest an extremely wide operation for s 494 and, at the outer reaches suggested by those observations, Magree's conduct may have been caught by the section. As for Spring, I accept Qantas' submission that there was some evidence in one of the affidavits (Howieson) which might remotely have led to a finding of him having engaged in contravening conduct. I do not propose to make costs orders against Qantas in relation to its case against these two individuals. I am not satisfied either the proviso or the precondition has been enlivened.

8. Different considerations arise in relation to Qantas' case based on the tort of nuisance. As the evidence unfolded, the case was not even barely arguable.  But that should have been apparent to Qantas at the outset as it should then have had a reasonable appreciation of what facts it could prove (or not prove) to support that claim.  I am inclined to think that the bringing and maintenance of that cause of action constituted an unreasonable act.  But, if so, should I exercise the discretionary power to make a special and specific costs order, by ordering Qantas to pay the respondents costs of defending that part of the proceedings concerning the case based on the tort of nuisance?  I think, on balance, I should not.

9. The costs order sought by the respondents is that Qantas pay 10% of its total costs to provide for them having had to defend the proceedings against Spring and Magree as well as the case based on the tort of nuisance. I have already rejected the argument that the first and second elements (arising from the case against Spring and Magree and the Trade Practices Act claim) should result in a costs order. The factual contest which might be thought to have concerned the nuisance case alone (and resulted in the respondents incurring additional costs) was extremely limited in compass, if not non-existent. It was reasonable for Qantas to lead evidence about the totality of events at SIT before, during and after the meeting outside Santos as part of painting a comprehensive picture of events that day which necessarily would have included evidence about the blocking of the road after the meeting. It is true that the respondents were required to prepare written submissions concerning the nuisance case and did. But the submission was extremely brief and did not involve any particularly detailed or complex legal or factual analysis. They also invoked the defence of justification which probably was as arguable as Qantas' case on this topic. That is, not even barely. Such additional costs as the respondents may have incurred in preparing that submission would be absolutely minimal. In these circumstances no special costs order should, in my opinion, be made.

10. I now consider the position of the Ombudsman.  Its proceedings were commenced well after the institution of the Qantas proceedings.  The respondents made an application for an order staying the Ombudsman's proceedings.  That application was resolved (with a little urging from me) on the basis that the Ombudsman furnished an undertaking in relation to costs.  The undertaking was in the following terms:

    A.He will not seek discovery from any Respondent without the leave of the Court.

    B.He will not at trial call any witness or otherwise adduce any evidence without the leave of the Court.

    C.       He will not at trial cross-examine any witness without the leave of the Court.

    D.He will pay to the Respondents their party-party costs incurred in this proceeding where such costs are additional to the costs incurred by the Respondents in defending or meeting the claims in proceeding NSD340/2009 (the Qantas proceeding), save in relation to:

    (i)the determination of issues, raised in the Further Amended Application and Further Amended Statement of Claim in matter NSD 1204 of 2009, which are not raised in the Qantas proceeding; and

    (ii)the pursuit of factual or legal issues common to this proceeding and the Qantas proceeding, to the extent that the Court determines was reasonable.

11. The reason advanced by the Ombudsman at the time for bringing his own proceedings notwithstanding that the Qantas proceedings were on foot was that the industrial action of 30 March 2009 was of a type to warrant civil penalty proceedings against appropriate respondents.  There was an apprehension, so it was said, the Qantas proceedings might settle with the result that those centrally involved in the industrial action would, in effect, go unpunished.

12. The respondents want the Ombudsman to meet their costs of defending its case against them.  A number of bases were advanced.  The first was that the Ombudsman proceedings were commenced without reasonable cause.  The second was that the prosecution of the proceedings constituted an unreasonable act.  The third was that it was not reasonable for the Ombudsman to have pursued factual and legal issues common to the Qantas proceedings and accordingly the Ombudsman was bound by its undertaking to pay party-party costs additional to those incurred in defending Qantas' case.

13. I am not satisfied the Ombudsman proceedings were commenced without reasonable cause.  The Ombudsman is, amongst other things, a regulatory agency with the power to bring proceedings of this type. In appropriate cases, he can be expected to do so.  Counsel for the Ombudsman was unable, during argument about costs, to satisfactorily explain what time limits there are in relation to bringing proceedings of this type and I can assume the Ombudsman proceedings were not commenced when they were because there was concern about the proceedings being time-barred.  However I think it was reasonable for the Ombudsman to have initiated its proceedings for the very reason given.

14. However it was, in my opinion, entirely unnecessary for the Ombudsman to have thereafter actively participated in the proceedings thereby substantially duplicating (in ways I mention shortly) the prosecution of the case by Qantas.  Necessarily the respondents had to assume the burden (with the associated legal costs) of answering or dealing with any step that the Ombudsman took (steps sustained by public funds) in addition to what was being done by Qantas in prosecuting its case itself.  I accept that the Ombudsman played an extremely limited role in the hearing.  However it did call three witnesses who, in my opinion, added nothing of substance to Qantas' case.  It filed extensive final written submissions (over 100 pages) and five related detailed chronologies (of a little over a further 80 pages).  Some, though not extensive, oral submissions were made by senior counsel. Again these submissions added nothing of substance to Qantas' submissions though I acknowledge different perspectives were advanced and some of the legal issues dealt with in greater detail than by Qantas.  That said, Qantas' final submissions were over 300 pages and dealt, in great detail, with the factual and legal issues raised in the proceedings.

15. Of course had Qantas settled with the respondents (a possibility which must be acknowledged as not fanciful - indeed I twice ordered mediation) the Ombudsman would then have been able to take such steps as advised to pursue his case if that remained the desired course.  But there was no justification, in my opinion, for the Ombudsman taking any role in prosecuting in any way a case against the respondents in the absence of such a settlement.

16. I am not prepared to say, as I was invited to by counsel for the Ombudsman, that such steps as it did take were "reasonable" for the purposes of paragraph (ii) of the undertaking. They were not. I have power, for these same reasons, to make a costs order because s 824(2) has been engaged. While I would hope that such an order would be unnecessary, I propose to make one to give the parties access to processes of taxation if they cannot agree on the quantification of the additional costs incurred by the respondents. That may be necessary because I do not propose to make the costs order sought by the respondents (that they receive 10% of their costs of the proceedings generally from the Ombudsman) which would, on my part, be little more than speculation about the actual costs.

I certify that the preceding two hundred and fifteen (216) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore.

Associate:

Dated:        22 July 2011