Schwarzenecker v Technical & Further Education Commission T/As TAFE NSW
[2017] FCCA 2423
•13 October 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SCHWARZENECKER v TECHNICAL & FURTHER EDUCATION COMMISSION T/AS TAFE NSW & ORS | [2017] FCCA 2423 |
| Catchwords: INDUSTRIAL LAW – Summary dismissal application by a respondent pursuant to s.17A(2) of the Federal Circuit Court of Australia Act 1999 (Cth) and r.13.10 of the Federal Circuit Court of Australia Rules 2001 (Cth) – no reasonable prospects of successfully prosecuting the proceeding or part of the proceeding – adverse action claim by an employee against another employee – claims against fifth respondent dismissed – costs order made. |
| Legislation: Fair Work Act 2009 (Cth), ss.340, 342, 539, 550, 570 Federal Circuit Court of Australia Act 1999 (Cth), ss.17A |
| Cases cited: Cross v Harbour City Ferries Pty Ltd t/as Harbour City Ferries (No.2) [2017] FCCA 1713 Ryan v Primesafe [2015] FCA 8; (2015) 323 ALR 107 Shammas v Canberra Institute of Technology [2014] FCA 71 Trustee for The MTGI Trust v Johnston (No.2) [2016] FCAFC 190 |
| Applicant: | KARL SCHWARZENECKER |
| First Respondent: | TECHNICAL & FURTHER EDUCATION COMMISSION T/AS TAFE NSW |
| Second Respondent: | ANDREW SMITH |
| Third Respondent: | STEPHEN HAMPSON |
| Fourth Respondent: | RODNEY JACKSON |
| Fifth Respondent: | JOSEF FRITZER |
| Sixth Respondent: | CHRIS ROBERTS |
| Seventh Respondent: | ALISON WOOD |
| Eighth Respondent: | BRENDA CLEAVER |
| File Number: | SYG 734 of 2017 |
| Judgment of: | Judge Smith |
| Hearing date: | 6 September 2017 |
| Date of Last Submission: | 6 September 2017 |
| Delivered at: | Sydney |
| Delivered on: | 13 October 2017 |
REPRESENTATION
| The applicant appeared in person. |
| Counsel for the Fifth Respondent: | Mr D O’Sullivan |
| Solicitors for the First, Second, Third, Fourth, Sixth, Seventh and Eighth Respondents: | Ms B. McCabe, Minter Ellison |
ORDERS
The claims against the fifth respondent be dismissed pursuant to s.17A of the Federal Circuit Court Act 1999 (Cth).
The applicant pay the costs of the fifth respondent from 13 July 2017 as taxed or agreed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT Sydney |
SYG 734 of 2017
| Karl Schwarzenecker |
Applicant
And
| Technical & Further Education Commission T/as Tafe Nsw |
First Respondent
| ANDREW SMITH |
Second Respondent
| stephen hampson |
Third Respondent
| rodney jackson |
Fourth Respondent
| JOSEF FRITZER |
Fifth Respondent
| CHRIS ROBERTS |
Sixth Respondent
| ALISON WOOD |
Seventh Respondent
| BRENDA CLEAVER |
Eighth Respondent
REASONS FOR JUDGMENT
These proceedings are brought by the applicant in respect of circumstances that have arisen in the course of his employment by the first respondent.
There are eight respondents. The claims against each respondent are identified with commendable clarity, in a table called the “Adverse Actions Claims Table” in pt.4 of the application. Table 3.1 (set out in pt.3.4 of the application) explains how the tables are to be understood.
Table 3.1, which is set out below, explains that each claim is identified by a claim number (“AAC” number) which is also the evidence catalogue number. Each AAC number is set out in two rows across two columns. In the first row of the first column the AAC number is set out, together with the respondent against whom the claim is made. The second row in the first column identifies the provision in the Fair Work Act 2009 (Cth) (FW Act) under which each AAC is made and gives a summary of the claim. The second column in the second row indicates which, if any, other claims are related to the claim.
The AAC numbers in respect of the fifth respondent are #AAC114 and #AAC121. The relevant parts of the table in the application are:
Adverse Action Claim # AAC114
Respondent: Mr Josef Fritzer
Ongoing false and negative Work Health and Safety (WHS) Propaganda and discrimination with intent to intimidate, harm and injure my employment
Evidence Cat. No.
AAC114
s.340, s.550
On 2 August 2016 Fritzer assaulted me at the front of Building D (Meadowbank TAFE College) citing WHS as reason with intent to intimidate, harm and injure my employment.
Fritzer has spread ongoing negative WHS propaganda about me to Smith when I complain about his poor conduct.
Fritzer would not have approached any other sectional teacher in the manner he did to me on 2 August 2016.
This was an adverse action linked to complaint no’s 1, 2, 3 & 4.
This relates to
AAC121
“Smith” is the second respondent, Andrew Smith.
Adverse Action Claim # AAC121
Respondent: Mr Andrew Smith
WHS Propaganda and discrimination with intent to hurt, distress humiliate and injure my employment
Evidence Cat No.
AAC121
s.340, s.550
On 14 September 2016, soon after Smith was notified from the Fair Work Commission about conference orders he singled me out with intent to hurt, distress, humiliate and injure my employment.
Smith deliberately walked through Building D carpentry workshop at 10:55am to catch any students of mine for safety breach so that he could provide content for Jackson whom he emailed soon after.
Smith did not take into consideration that I had completed a risk assessment for the activity and that the tasks being undertaken at that time were deemed to be low risk activities. Nor did he consider what is reasonably practicable given the number of students and age.
I suspect Smith has not notified Jackson about safety glasses via email (with Importance being High) regarding any other teacher including his brother Mark Smith or Alan Edgecumbe’s son, Stephen Edgecumbe or Hampson.
All of these teachers have had students at various times not wearing their safety glasses.
This was an adverse action linked to complaint no’s 4 & 5.
This relates to AAC114
(Emphasis in original)
The fifth respondent seeks summary dismissal of the claims against him pursuant to s.17A(2) of the Federal Circuit Court of Australia Act 1999 (Cth) (FCC Act), r.13.10(a) of the Federal Circuit Court of Australia Rules 2001 (Cth) (FCC Rules), and/or r.13.10(c) of the FCC Rules.
Consideration
Section 17A of the FCC Act empowers the Court to give judgment for one party, against another party, in relation to any part of a proceeding if the Court is satisfied that the applicant has “no reasonable prospect of successfully prosecuting … that part of the proceeding”. Rule 13.10(a) of the FCC Rules is to the same effect. Rule 13.10(c) empowers the Court to summarily dismiss a claim if it is satisfied that the claim is an abuse of process of the Court.
Section 17A(3) of the Act provides:
(3)For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a) hopeless; or
(b) bound to fail;
for it to have no reasonable prospect of success.
In Shammas v Canberra Institute of Technology [2014] FCA 71 Foster J said of the analogous provision in the Federal Court of Australia Act 1976 (Cth):
50In Singh v Super City Home Loans Pty Ltd [2011] FCA 646, at [129], I summarised the principles to be applied when the Court comes to consider exercising its power to summarily dismiss a proceeding pursuant to s 31A of the Federal Court Act in light of the High Court’s decision in Spencer v The Commonwealth (2010) 241 CLR 118. It is not necessary to extract that summary in full here. It is sufficient to note the following:
(a)The power to order summary dismissal pursuant to s 31A is different from the power to strike out defective pleadings pursuant to a rule of Court in the terms of O 11 r 16 of the Federal Court Rules 1979.
(b)The power to terminate proceedings summarily should be exercised with caution.
(c)There must be a high degree of certainty that the claimant cannot succeed if the proceeding is allowed to go to trial in the ordinary way.
(d)There must be “no reasonable prospect of success”. This is a different concept from the concept of “no real prospect of success”. The statutory admonition is that a proceeding may be found to have no reasonable prospect of successful prosecution even if it is not hopeless or bound to fail. This test constitutes a radical departure from previous regimes which required that the proceeding must be shown to have no prospects of success.
(Emphasis in original)
As can be seen from the table of claims concerning the fifth respondent, the claims against him are brought in respect of ss.340 and 550 of the FW Act.
Section 539(1) of the FW Act, read together with the table to s.539, provides that s.340 (amongst other provisions) is a “civil remedy provision”. Section 539(2) of the Act, read together with the table, provides that a person affected by a contravention of particular types of civil remedy provisions (including s.340), can apply to the Federal Court or the Federal Circuit Court for orders in relation to the contravention.
Section 340 prohibits a person from taking adverse action against another person for certain specified reasons. “Adverse action” is defined in s.342 of the FW Act. The table in that provision sets out the seven categories of persons, who may take the action against another category of person, and specifies in respect of each category the type of action that constitutes “adverse action”. Thus, in item 1(a) of that table, an employer will take adverse action against an employee if the employer dismisses the employee.
There is no category of adverse action in which an employee is the person taking the action against another employee. Adverse action is taken by the employee “against his or her employer if the employee …”. That is not the case before me.
Here, the applicant did not contend that the fifth respondent was anything other than an employee. For that reason, the action upon which the claim under s.340 of the FW Act is based, does not fall within the meaning of “adverse action” in s.342 of the FW Act and the claim has no reasonable prospects of success.
At the hearing of this application, the applicant clarified his claim against the fifth respondent as being based on the fifth respondent’s involvement in, or aiding of contraventions by another person. That is, his claim is based on s.550 of the FW Act.
Section 550 of the FW Act provides:
(1)A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.
(2)A person is involved in a contravention of a civil remedy provision if, and only if, the person:
(a)has aided, abetted, counselled or procured the contravention; or
(b)has induced the contravention, whether by threats or promises or otherwise; or
(c)has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d)has conspired with others to effect the contravention.
(Emphasis in original)
The difficulty in respect of this claim, however, is that the “contravention of a civil remedy” the applicant relies on, is said to have been committed by another employee, Andrew Smith. The civil penalty provision said to have been contravened was s.340 of the FW Act, the prohibition against adverse action. For the reasons I have given, adverse action cannot be taken by an employee against another employee. Accordingly, the claim that the fifth respondent was involved in a contravention of the FW Act is fundamentally flawed, and has no reasonable prospects of success.
The claims against the fifth respondent will be dismissed pursuant to s.17A of the FCC Act.
Order for Costs
The remaining question in the application is whether there ought to be an order for costs. In Cross v Harbour City Ferries Pty Ltd t/as Harbour City Ferries (No.2) [2017] FCCA 1713, I found that this Court has power to make an order for costs in proceedings brought under the FW Act, but that the power was conditioned by s.570 of the FW Act.
Section 570 of the FW Act provides:
570 Costs only if proceedings instituted vexatiously etc.
(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A.
(2)The party may be ordered to pay the costs only if:
(a)the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or
(b)the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs; or
(c)the court is satisfied of both of the following:
(i) the party unreasonably refused to participate in a matter before the FWC;
(ii) the matter arose from the same facts as the proceedings.
The fifth respondent relies on both sub-ss.570(2)(a) and (b) of the FW Act. In support of the latter, he notes that his solicitors wrote to the applicant on 7 July 2017 explaining the deficiencies in the claim against the fifth respondent. The applicant was invited to discontinue the proceedings. The letter indicated that if the matter was not discontinued by 12 July 2017, an order for costs would be sought and the letter would be relied on in support of that application.
Section 570 of the FW Act has been considered on a number of occasions by the Federal Court. Relevantly for these purposes, in Ryan v Primesafe [2015] FCA 8; (2015) 323 ALR 107, Mortimer J said, at [64] – [66]:
[64]I accept the general import of the authorities relied on by the applicant and Mr McDonald in their written submissions about the significance of the threshold set by s 570(2) of the Fair Work Act. Although some of the authorities relied on dealt with the predecessor provisions to s 570, there is no difference in substance in the way the threshold is expressed. The discretion conferred by the confined terms of s 570(2) should be exercised cautiously, and the case for its exercise should be clear: see Saxena v PPF Asset Management Ltd [2011] FCA 395 at [6] per Bromberg J. The reason for caution is the potential for discouraging parties’ pursuit in a complete and robust way of the claims for contravention which they seek to make under the Fair Work Act, or the defence of such claims. The policy behind s 570 is to ensure that the spectre of costs being awarded if a claim is unsuccessful does not loom so large in the mind of potential applicants (in particular, in my opinion) that those with genuine grievances and an arguable evidentiary and legal basis for them are put off commencing or continuing proceedings. It is an access to justice provision. Insofar as it operates to the benefit of respondents, it is designed to ensure respondents feel free to pursue arguable legal and factual responses to the claims made against them. There is an almost identical provision in s 611 of the Fair Work Act, giving the Fair Work Commission a similar costs power, conditioned by similarly-worded considerations. The predecessor provisions, and the conscious broadening of the statutory terms used in s 570, are traced by the Full Court in Australasian Meat Industry Employees’ Union v Fair Work Australia (No 2) (2012) 203 FCR 430; [2012] FCAFC 103 at [3]-[4] per Jessup and Tracey JJ.
[65]None of those propositions deny the Court’s ability to find that one or both of the two preconditions expressed in ss 570(2)(a) and (b) exist where the factual circumstances warrant it. The legislative policy behind a provision such as s 570(1) is not inconsistent with the requirements for proceedings to be conducted reasonably, fairly and efficiently. As an access to justice provision, it contemplates parties and their legal representatives will access the Court responsibly.
[66]Section 570, and the conditions it imposes on the Court’s general costs discretion under s 43 of the Federal Court Act, is not a licence to parties to ignore the requirements of s 37M of the Federal Court Act, nor the Court’s power to order costs against parties who fail to comply with their obligations under s 37N. The content of ss 37M and 37N, and parties’ obligations to assist the Court in achieving the objectives set out in s 37M, must be reconciled with access to justice provisions such as s 570(1). That reconciliation occurs through a focus on the reasonableness of parties’ conduct, the appropriateness of the Court processes undertaken by them, the timeliness of their compliance with Court orders or steps in the proceeding, and the existence of a substantive legal and factual basis for the claims made and arguments put.
Her Honour’s observations were expressly approved by a Full Court of the Federal Court in Trustee for The MTGI Trust v Johnston (No.2) [2016] FCAFC 190 at [8] where the Full Court (Siopis, Collier and Katzmann JJ) observed:
Section 570 of the FW Act confers discretion on the Court to order costs in Fair Work matters where proceedings were instituted vexatiously or without reasonable cause. Not only must this discretion be exercised judicially according to the terms defining it, it must be exercised with caution because of the exceptional nature of the power in an otherwise no-costs jurisdiction. …
In my view, the facts of this case do fall within sub-ss.570(2)(a) and (b). There was never any reasonable basis to bring proceedings under the FW Act against a fellow employee. Once that was pointed out to the applicant, it was unreasonable for him to fail to discontinue the proceedings against the fifth respondent. That unreasonable act led the fifth respondent to incur further expenses in bringing this application.
While the fact that the applicant is self-represented does not stand in the way of a costs order, I have taken that into account in the exercise of the discretion to award costs. The legislative scheme of the FW Act is not straightforward and I accept that this might impact on the nature of claims brought by self-represented litigants. However, matters changed once the deficiencies in his claims were explained to the applicant in the letter of 7 July 2017. While the commencement of the proceedings may be mitigated by a lack of legal training and experience, the continuation of them was not.
For those reasons, I consider that there ought to be an order for costs and that the appropriate order, is that the applicant pay the costs of the fifth respondent from 13 July 2017 as taxed or agreed.
I certify that the preceding twenty-five (25) paragraphs are a true copy of the reasons for judgment of Judge Smith
Date: 13 October 2017
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