Smith v SBP Employment Solutions Pty Ltd and Ors (No.4)
[2020] FCCA 61
•16 January 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SMITH v SBP EMPLOYMENT SOLUTIONS PTY LTD & ORS (No.4) | [2020] FCCA 61 |
| Catchwords: INDUSTRIAL LAW – COSTS – Application for indemnity costs from stipulated date for acceptance of offer until finalisation of proceeding – relevant matters for consideration – terms of proposed Deed of Settlement countenanced in offer of settlement unspecified – inclusion of requirement for execution of Deed submitted to be illusory – order for costs on party/party basis as and from date nominated for acceptance of offer until conclusion of proceeding – order for taxation pursuant to Part 40 of the Federal Court Rules 2011 (Cth). |
| Legislation: Fair Work Act 2009 (Cth), s.570 |
| Cases cited: Smith v SBP Employment Solutions Pty Ltd & Ors (No.2) [2019] FCCA 3318 |
| Applicant: | NICHOLAS SMITH |
| First Respondent: | SBP EMPLOYMENT SOLUTIONS PTY LTD |
| Second Respondent: | SBP AUSTRALIA PTY LTD |
| Third Respondent: | MAX BURNS |
| Fourth Respondent: | TONY AISTHORPE |
| Fifth Respondent: | DAN MAHONY |
| Sixth Respondent: | NEVILLE HOMBSCH |
| Seventh Respondent: | PETER CHADWICK |
| File Number: | BRG 330 of 2018 |
| Judgment of: | Judge Egan |
| Hearing date: | 23 December 2019 |
| Date of Last Submission: | 23 December 2019 |
| Delivered at: | Brisbane |
| Delivered on: | 16 January 2020 |
REPRESENTATION
| Counsel for the Applicant: | Dr R. Haddrick |
| Solicitors for the Applicant: | FCB Lawyers and Consultants |
| Counsel for the Respondent: | Mr S. Mackie |
| Solicitors for the Respondent: | Carter Newell Lawyers |
ORDERS
That the First, Second, Third, Fourth, Fifth and Sixth Respondents are jointly and severally liable for the payment to the Applicant of 60% of the Applicant’s costs of and incidental to the proceeding as and from 8 January 2019 until the handing down of this judgment.
That pursuant to Rule 21.02(2)(c) of the Federal Circuit Court Rules 2001, that the costs ordered to be paid pursuant to Order (1) hereof be referred for taxation, on a party/party basis, under Part 40 of the Federal Court Rules 2011 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 330 of 2018
| NICHOLAS SMITH |
Applicant
And
| SBP EMPLOYMENT SOLUTIONS PTY LTD |
First Respondent
| SBP AUSTRALIA PTY LTD |
Second Respondent
| MAX BURNS |
Third Respondent
| TONY AISTHORPE |
Fourth Respondent
| DAN MAHONY |
Fifth Respondent
| NEVILLE HOMBSCH |
Sixth Respondent
| PETER CHADWICK |
Seventh Respondent
REASONS FOR JUDGMENT
The applicant seeks orders that the applicant should receive the benefit of an indemnity costs order for costs incurred by him, during the course of the proceeding, as and from 8 January 2019 until the delivery of this judgment.
The Court pronounced declarations and orders on liability in this matter on 5 December 2019, the reasons for which were handed down on 21 November 2019. [1] The Court found in favour of the applicant on claims, the consideration of which collectively involved more than half of court hearing time during the course of the whole of the proceedings. The Court also imposed pecuniary penalties against each of the first respondent, second respondent, third respondent, fourth respondent, fifth respondent and sixth respondent in respect of found contraventions of the Fair Work Act 2009 (Cth) (‘the FWA’). Pecuniary penalties totalling the sum of $97,650 were ordered to be paid directly to the applicant.
[1] Smith v SBP Employment Solutions Pty Ltd & Ors (No.2) [2019] FCCA 3318.
On 5 December 2019, the Court made compensation orders in favour of the applicant totalling $589,439.43. Interest in the amount of $13,925.16 was also awarded in addition to such sum. [2]
[2] Smith v SBP Employment Solutions Pty Ltd & Ors (No.3) [2019] FCCA 3516.
Proceedings were commenced by the applicant on 3 April 2018. At trial:
a)The applicant relied upon three (3) affidavits – one (1) was filed on 5 October 2018 and two (2) were filed on 12 October 2018.
b)The respondents relied upon five (5) affidavits, four having been filed on 26 November 2018 and one having been filed on 24 July 2019.
A court ordered mediation occurred on 30 November 2018 before a Registrar of the court. The mediation did not resolve the dispute between the parties.
On 18 December 2018, the lawyers for the applicant sent the following documents to the respondents’ legal representative by email:
a)A letter of offer entitled “Without Prejudice, Save as to Costs”. [3]
b)A Notice of offer to compromise in Form 45 made pursuant to Rule 25.01(1) of the Federal Court Rules 2011 (Cth). [4]
[3] Paragraph 5 of affidavit of Brittany Byrne filed on 9 December 2019 and annexure BJB-A
[4] Paragraph 6 of affidavit of Brittany Byrne filed on 9 December 2019 and annexure BJB-B
Those documents respectively are as follows:
Letter of 18 December 2018
“18 December 2018
Mr Timothy Franklin
TimmyRFranklin Consulting
7 Dowar Street
Coorparoo QLD 4151By email: [email protected]; [email protected]
Our Ref: 180336: BLS:BJB
Without Prejudice, Save as to Costs
Dear Mr Franklin
NICHOLAS SMITH V SBP EMPLOYMENT SOLUTIONS & ORS [BRG330/2018]
1. We refer to the above matter (Proceedings) and confirm that you act for the First to Seventh Respondents.
2. We confirm that the parties’ pleadings in the Proceedings have now closed and the parties have both filed their affidavit material that they intent to rely upon at the final hearing, which we understand has been set down for a five-day hearing commencing Monday, 29 July 2019.
3. In our view, your clients face considerable difficulties in defending the claims pleaded in our client’s Application and Statement of Claim. On this basis, we consider that your clients are not likely to succeed against our client. We have briefly set out some grounds for this assertion below.
Reason for Termination
4. As you will be aware, relevant to a claim alleging breach of general protections under the Fair Work Act 2009 (Cth) (Act) is the employer's reason for taking the adverse action complained of in the application. In particular, section 361 of the Act provides:
"(1)/f:
(a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b) taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise."
5. Our client's Application and Statement of Claim allege that SBP Employment Solutions Pty Ltd (SBP), as our client's former employer, dismissed him from his employment. Your client's Defence admits this allegation.
6. While the parties' pleadings put into issue the date upon which our client's dismissal occurred, the affidavit evidence filed by your client, including that of Mr Tony Aisthorpe, Mr Max Burns and Mr Peter Chadwick, is indeed entirely consistent with our client's Statement of Claim (and his evidence), which alleges that SBP dismissed him from his employment (with immediate effect) on 20 November 2017. Accordingly, your clients' affidavit evidence does not support the allegation made in their Defence that our client's final day of employment was 23 November 2017. Indeed, we consider that the Court will accept, based on both parties' affidavit evidence, that the dismissal occurred in a meeting which occurred in the middle of the day on 20 November 2017.
7. In this regard, all events occurring after our client's dismissal on 20 November 2018 and all knowledge acquired by your clients and their witnesses after the dismissal, are irrelevant for the purposes of the Court determining the reason for our client's dismissal.
8. Your clients' Defence and affidavit evidence supports a clear position that none of your clients were aware of the matters related to the "theft" allegations complained of in paragraph 38(f)(ii) of the Defence (which are denied by our client) prior to, or at the time of, our client's dismissal. In this regard, the matters related to the "theft" allegations are completely irrelevant for the purpose of determining the reason that our client was dismissed on 20 November 2018.
9. While your clients' Defence, at paragraph 38(f)(ii), claims that our client was dismissed from his employment on 22 November 2017 for "gross misconduct... (theft)", paragraph 17 of Mr Burns' affidavit states "We terminated the Applicant's employment on account of these losses, general poor performance, his inability to manage the business and the poor future forecast of the business".
10. There are a number of very obvious issues with your clients' defence to our client's general protections claim that will, in our client's view, result in your client failing to discharge the burden of proof under section 361 of the Act.
Substantiation of damages
11. You may be aware that subsection 545(1) of the Act allows a Federal Circuit Court to make any order the Court considers appropriate if the Court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision (such as section 340, 343 and 351 of the Act).
12. Further subsection 545(2) of the Act provides that, without limiting subsection (1), orders of the Federal Circuit Court may make include, inter alia, an order awarding compensation for loss that a person has suffered because of the contraventions.
13. Our client's claim to compensation with respect to the general protections application is that he suffered loss, i.e. he sustained a psychiatric injury, because of SBP's contraventions of section 340, 343 and/or 351 of the Act.
14. It is our position that our client will be entitled to general damages on account for the loss he has suffered as a consequence of his psychiatric injury caused by his unlawful dismissal in contravention of section 343 and/ or 351 of the Act.
15. In addition to general damages, you will be aware that our client claims that, but for SBP's dismissal of our client, our client would have remained employed by your client until he was 67 years of age.
16. As you will be aware, there is no 'cap' on compensation that may be awarded by a Court in a claim alleging breach of general protections.
17. You would be aware of a number of cases (alleging contravention of general protections) where the Court has awarded an applicant compensation for future economic loss calculated based on the amount of time that employee would have remained employed by the respondent employer. By way of example only, we refer you to the cases of CFMEU v Hail Creek Coal Pty Ltd [2016] FCA 1032 (Hail Creek) and Kassis v Republic af Lebanon [2014] FCCA 155 (Kassis).
18. In Hail Creek, the employee was awarded $1,296,735 (plus interest) on account for past and future economic on the basis that the Court found that, but for the unlawful termination of the employee's employment, the employee would have remained employed for the life of the mining project the employee was assigned to. The employer was also ordered to pay $50,000 in penalties for its contravention of a civil remedy provision, namely its unlawful termination of the employee.
19. In Kassis, the employee was awarded $333,296.42 for future economic loss in addition to compensation for other heads of loss. That future economic loss was calculated on the basis that, but for the contravention of the employee's general protections and her unlawful dismissal, she would have remained employed until her retirement. The respondent employer was also ordered to pay $50,000 in penalties for its contraventions of civil remedy provisions, including the employee's unlawful termination.
Failure to pay annual leave entitlement
20. One very obvious deficiency in your clients' defence in the Proceedings is their defence to the allegation that SBP breached the National Employment Standards (namely section 90(2) of the Act) when it failed to pay him an amount equivalent to his accrued annual leave entitlement upon termination of his employment.
21. It appears, based on your clients' defence and affidavit material, that SBP's excuse for failing to pay our client his annual leave entitlement upon termination of his employment is that our client did not submit timesheets recording his time worked and, therefore, SBP was not aware of the amount of annual leave accrued by your client.
22. Our client's annual leave balance, as at 17 November 2017, was stated on our client's final pay slip (Pay Slip) and was 165.06 hours. Our client accepts that, as at 17 November 2017, he had accrued 165.06 hours annual leave. Accordingly, it appears that our client's annual leave entitlement was continuing to accrue, irrespective of your clients' complaints that SBP did not receive timesheets from our client.
23. Our client's position has been made clear with respect to the reasons that he declined to provide your clients with timesheets. In our view, our client's refusal to provide timesheets, and the reason for that refusal, has no bearing on SBP's obligations under sections 87 and 90(2) of the Act and section 119A of the Workers' Compensation and Rehabilitation Act 2003 (Qld) (WCR Act).
24. It is clear to us that, from the commencement of our client's dispute with your clients, SBP has been aware of its obligations under section 90(2) of the Act.
25. Indeed, paragraph 43 and 44 of Mr Chadwick's affidavit confirms that he had knowledge of SBP's obligations under section 90(2) as early as 20 November 2017. Indeed, the letters to WorkCover attached to Mr Chadwick's affidavit (which appear to be authored by Mr Chadwick) refer to numerous sections of the WCR Act.
26. Pursuant to subsection 119A of the WCR Act, a worker who is entitled to workers' compensation, including compensation payable as weekly instalments, is entitled to take or accrue annual leave, sick leave and long service leave under an Industrial Act, such as the Act, or industrial instrument during the period to which the compensation relates. In relation to entitlements under the Act, subsection 119A of the WCR Act removes the restriction under section 130(1) of the Act with respect to accruals of annual leave, and other leave.
27. This means that, irrespective of the hours being worked by our client during the time he was entitled to workers' compensation (16 January 2017 until the termination of his employment), he was entitled to accrue annual leave under the Act, including under section 87 of the Act, during the period to which the compensation relates. On this basis, by operation of section 119A of the WCR Act, the accrual of our client's annual leave under the Act should not have been (and apparently was not, according to the annual leave hours recorded on the Pay Slip) disrupted, reduced or otherwise minimised by our client being entitled to workers' compensation.
28. Therefore, our client's conduct in not submitting timesheets had no bearing on his entitlement to accrue annual leave of 20 days per annum and be paid his total accrued annual leave entitlement upon the termination of his employment.
29. SBP's continual failure to pay our client an amount equivalent to his annual leave entitlement will, in our view, be viewed very unfavourably by the Court. This is especially so in circumstances our client, in his affidavit evidence, has stated, at paragraph 412, "From the date that the Workers Compensation Claim was approved (16 January 2017) until the termination of my employment, all time that I was absent from the workplace for personal or health purposes was to attend to medical appointments for treatment in relation to the injuries that I had sustained from the Accident. During this time, I always worked in excess of 40 hours per week except for weeks where I took approved paid personal leave."
30. Furthermore, we are instructed that on 24 January 2018, our client through his representative, submitted to the First and Seventh Respondents (by way of email) written notification of the hours he had worked during the period of 5 June 2017 up until and including 8 November 2017. Our client did so in a desperate attempt to be paid his accrued annual leave entitlement that, as at the date of this letter, has been due and owing to him for over 12 months. We are further instructed that your clients refused to accept the hours submitted by our client, through his representative, to the First and Seventh Respondents on 24 January 2018 and provided no proper justification for this refusal.
31. In this regard, we draw your attention to the case of Fair Work Ombudsman v Pulis Plumbing Pty Ltd Et Anor [2017] FCCA 3013 (Pulis) where, the Court ordered the two respondents to pay over $121,000 in penalties. In Pulis, the parties were in dispute over the hours worked by the applicant employee.
32. At paragraph 19 of the decision in Pulis, Judge Riethmuller said:
"Whilst the admissions were made, the timesheets were never produced to the Court or the FWO, leaving the office to rely upon the employee's records of the hours worked. I note that it is not an uncommon occurrence for employers to not produce timesheets or records for employees, which appears to create impediments to the investigation of these matters and the calculation of the proper entitlements of the employees. Given the statutory requirements upon employers with respect to record-keeping, it appears to me that, ordinarily, a Court would accept even the most slight and generalised evidence of an employee as to the hours of employment in circumstances where an employer does not produce appropriate records. More recently, the FW Act has been amended to ensure that an employer who does not keep records required by the Act in ss. 535 and 536, then the employer has the burden of disproving the allegations about those matters: see s. 557C. In short, in future if the employer fails to keep time sheets and provide payslips the employer has the burden of disproving an employee's claim about hours worked and payments made."
33. We consider that SBP's contravention of section 90(1) of the Act, and the other Respondents' involvement in that contravention, will likely attract significant civil penalties.
Resolution of the Matter
34. Our client will vigorously pursue the Proceedings in the event it cannot be resolved. In this regard, he is of course prepared to proceed to trial if it becomes necessary.
35. Despite our views about your clients' prospects in relation to defending the Proceedings, in an effort to swiftly dispose of this matter without the need for any party to incur further legal costs, on a without prejudice basis and without any admission, our client would be prepared to settle all of his claims against the First to Seventh Respondents on the following basis:
a. that the First Respondent pay our client the sum of $300,000 (to be described in the Deed of Release in a fashion suitable to our client) within 28 days after acceptance of this offer;
b. that each party bears their own legal costs in connection with the Proceedings; and
c. that the Proceedings be discontinued by our client.
36. Our client's offer will remain open for acceptance by your clients in writing until 5pm on Monday, 7 January 2019 after which time this offer will lapse without further notice to your clients.
37. Should your clients fail to accept this offer, our client will have no hesitation relying on this letter for any application for costs he might make in connection with the Proceedings including under the Act and/ or the Federal Circuit Court of Australia Act1999 (Cth) in accordance with the principles enunciated in Calderbonk v Calderbank [1975] 1 All ER 333.
Yours faithfully
FCB – Workplace Law
(Signature of Brittany Byrne)
BRITTANY BYRNE
Senior Associate
Notice of offer to compromise
“Form 45
Rule 25.01(1)
Notice of offer to compromise
No. BRG330 of 2018
Federal Court of Australia
District Registry: Queensland
Division: Brisbane
NICHOLAS STEPHEN SMITH
Applicant
SBP EMPLOYMENT SOLUTIONS PTY LTD & ORS
Respondents
To the First, Second, Third, Fourth, Fifth, Sixth and Seventh Respondents
The Applicant offers to compromise this proceeding.
The offer is:
1. The First Respondent to pay the Applicant the amount of $300,000 (to be described in the Deed of Release in a fashion suitable to the Applicant); and
2. This proceeding is discontinued.
This offer of compromise is inclusive of costs.
This offer of compromise is open to be accepted for 20 days after service of this offer of compromise.
The amount of the offer will be paid within 28 days after acceptance of this offer.
This offer is made without prejudice save as to costs.
Date: 18 December 2018
(Signature of Brittany Byrne)
Signed by Brittany Byrne
Lawyer for the Applicant”
The applicant was plainly offering to discontinue any proceedings against the respondents, and not seek any costs order against them, if he was paid the sum of $300,000 in full and final satisfaction of his claims. Curiously, each document also contemplated the preparation of a Deed whereby any payment of the sum of $300,000, in settlement of the applicant’s claims, was “to be described in the Deed of Release in a fashion suitable to our client.”
Neither of the offers forwarded to the lawyer for the respondents was ever responded to by or on behalf of the respondents. Substantial costs were incurred by the applicant subsequent to the passing of the date nominated for acceptance of the settlement offers.
The respective offers were made at a time after the holding of a court ordered mediation, by which time each of the parties had had the opportunity to focus acutely upon the issues at hand. Each party ought to have appreciated the respective strengths and weaknesses in each of their cases at the time of the conclusion of the mediation. That is a relevant factor which the Court has taken into account when arriving at its decision in relation to the subject application for costs.
The applicant’s 18 December 2018 letter, by paragraphs 4 – 10 inclusive thereof, succinctly predicted the Court’s findings in relation to the two most important aspects of the applicant’s case – namely on the question of termination of the applicant’s employment, and on the question of whether the respondents were justified in claiming that the applicant had stolen certain items of property from the first or second respondent. That letter also predicted the Court’s findings in relation to the claim involving a failure on the part of the first respondent to pay to the applicant his annual accrued leave entitlement.
Having noted that the applicant was substantially successful in his claims made against the respondents, it is nevertheless the case that the applicant was unsuccessful in respect of a number of claims advanced and maintained by him during the course of the trial. Those claims were categorised, respectively, as the:
a)Coercion Claim;
b)Undue Influence Claim;
c)Discrimination Claim.
The letter of offer of 18 December 2018 invoked the principles enunciated in Calderbank v Calderbank [1975] 3 All ER 333.
Section 570 of the FWA provided as follows:
“SECT 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.
Note: The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 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.”
In Ryan v Primesafe [2015] FCA 8 at [64] – [65], Mortimer J described the court’s power under s. 570 of the FWA as follows:
“[64].... 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. ...
[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.”
In Szencorp Pty Ltd v Clean Energy Council Limited (No.2) [2009] FCA 196 at [6] – [7], Goldberg J referred to the making of a “Calderbank offer” as follows:
“[6] The appellation “Calderbank offer” has its origin in the decision of the English Court of Appeal in Calderbank v Calderbank [1976] Fam 93 at 106. In essence, a Calderbank offer is one which is made in a proceeding before judgment on the basis of it being without prejudice save as to costs and in which an offer for settlement or resolution of the proceeding is made. The right is reserved to refer to the offer if any issue arises as to costs once judgment is delivered. A court can take the offer into account in determining what costs order should be made notwithstanding that the payment into court procedure provided in the court’s rules has not been followed. If the party to whom the offer is made does not obtain a more favourable result than the offer made and it is established that in the circumstances of the case that party ought to have accepted the offer, then costs will be awarded on the same basis as if there had been a payment into Court prior to judgment and judgment for a lesser amount had been obtained.
[7] The refusal or rejection of a Calderbank offer, of itself, does not automatically mean, or give rise to a presumption, that the Court should make an order for costs on either a party/party basis or (depending on the circumstances) an indemnity basis where the result is less favourable to the offeree than the offer. It must be established that it was unreasonable in all the circumstances for the offeree to reject the offer: Jacomb v Australian Municipal, Administrative, Clerical & Services Union [2004] FCA 1600 at [6]; Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) (2005) 13 VR 435 at 440.”
In Veda Advantage Ltd v Malouf Group Enterprises Pty Ltd (No.2) [2016] FCA 470 at [31], Katzmann J said:
“[31]… [R]efusal to accept an offer not made in compliance with the rules (a Calderbank offer, see Calderbank v Calderbank [1975] 3 All ER 333) does not give rise to any presumption in favour of the offeror. The offeror needs to show that there was a genuine offer of compromise, and that it was unreasonable for the offeree not to accept it: Black v Lipovacat [217]–[218]. In deciding whether it is unreasonable for an offer to be rejected, the following matters should ordinarily be considered:
• the stage of the proceeding when the offer was made;
• the time afforded to the offeree to consider the offer;
• the extent of compromise involved;
• the offeree’s prospects of success, assessed as at the date of the offer;
• the clarity with which the terms of the offer were expressed;
• whether the offer foreshadowed an application for indemnity costs in the event of refusal.”
The Court accepts the submissions made on behalf of the applicant that it was unreasonable conduct on the part of the respondents not to have accepted the applicant’s settlement proposal. The respondents ought to have appreciated the risks associated with proceeding with the litigation in the face of the offers as made by the applicant.
On the question of termination, the Court found that the respondent’s proclamations as to the applicant’s proficiency and competence made shortly prior to his termination were irreconcilable with the stated bases for the applicant’s termination. So much was objectively clear from a reading of the correspondence annexed to the affidavits filed on behalf of both parties. Had the respondents adopted a considered and reasonable approach to the evidence before the Court, it would have been to the advantage of the applicant, the respondents, and to the Court, had the respondents accepted the applicant’s offer, which offer amounted to approximately half of what the Court has otherwise held the respondents are required to pay to the applicant. The respondents should have accepted the applicant’s offer of settlement and it was unreasonable for them not to have done so.
The Court is not satisfied, however, that this is an appropriate case for the making of an indemnity costs order. The Court does not consider that there was any special or unusual feature in the case justifying the Court departing from the ordinary practice of awarding costs on a party and party basis. [5] The Court notes that the applicant’s successful claims ran parallel, in substantial respects, with the applicant’s unsuccessful claims. The evidence at times overlapped. The claims were not entirely independent, such that it could not be said that one part of cross-examination could be attributed only to one part of the successful claim, or otherwise that cross-examination on one issue was clearly distinct from one or other issue to be determined.
[5] Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 at [233] per Sheppard J.
The Court does not accept that the offer was illusory because of the purported requirement that it be entered into. The reference in the Deed to “in a fashion suitable to our client” was clearly only meant as a reference as to the manner of payment – vis by cheque, direct credit etc. – rather than the purported incorporation of some non-monetary obligation.
However, the Court acknowledges the force of submissions made on behalf of the respondents to the effect that if the Court was minded to make an order for costs in favour of the applicant, that such costs should be on the standard basis, but that such costs be reduced by 40%, having regard to the applicant’s lack of success on some of his claims. The Court accepts such submissions.
The Court is not minded to undertake an assessment of costs in a complex matter such as this. The relevant time and expertise required to do so in matters of this kind dictates that such assessment is best dealt with by those experienced in the field who are tasked to do so.
For the above reasons, and in the exercise of its discretion, the Court so orders that the first, second, third, fourth, fifth and sixth respondents are jointly and severally liable to pay to the applicant 60% of the applicant’s costs of and incidental to the proceeding, on a party/party basis, as and from 8 January 2019 until the date hereof.
I certify that the preceding twenty-four (24) paragraphs are a true copy of the reasons for judgment of Judge Egan
Associate:
Date: 16 January 2020
thereto. thereto.
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