Stuart Bormann v Visy Board Pty Ltd
[2011] FWA 2793
•13 MAY 2011
[2011] FWA 2793 |
|
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Stuart Bormann
v
Visy Board Pty Ltd
(U2010/12421)
SENIOR DEPUTY PRESIDENT O’CALLAGHAN | ADELAIDE, 13 MAY 2011 |
Termination of employment - costs.
[1] This decision deals with an application for costs made consequent upon a decision I issued on 11 March 2011 1. In that decision I determined that the termination of Mr Bormann’s employment by Visy Board Pty Ltd (Visy Board) was harsh, unjust or unreasonable.
[2] On 24 March 2011 Mr Hardie of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) filed a Form F6 - Application for costs. The costs application named as the applicants both Mr Bormann and the AMWU and as the respondents both Mr Ian Colgrave and Visy Board. I note that Mr Colgrave was the legal counsel who appeared for Visy Board during the hearing of the unfair dismissal application.
[3] The costs application, in summary was made on the basis that FWA had granted permission for Mr Colgrave, a lawyer, to appear for Visy Board pursuant to section 596 of the Fair Work Act 2009 (the FW Act) and “This enlivened s376 for the purposes of a s401 claim for cost orders against Mr Colgrave.” The matter was the subject of a hearing on 21 April 2011. Mr Hardie appeared at this hearing and Visy Board was represented by Mr Colgrave, of counsel. At the conclusion of the hearing Mr Hardie advised that he was pursuing costs pursuant to sections 401 and 611 of the FW Act. In so far as the costs application referenced section 376 of the FW Act, this is clearly not relevant as that section operates only in relation to general protection applications. Similarly, whilst I do not understand Mr Hardie to be pursuing the application pursuant to section 780 of the FW Act, I confirm that that section is also not relevant.
[4] Mr Hardie asserted that the remedy granted in this matter replicated the terms of the settlement proposed by the AMWU on Mr Bormann’s behalf, which settlement had been rejected by Visy Board. Further, that Visy Board had not articulated a valid reason for the termination of Mr Bormann’s employment and the absence of such a valid reason was confirmed in my decision. Mr Hardie asserted that he had put Mr Colgrave on notice of the possibility of the costs claim pursuant to s.401.
[5] Mr Hardie asserted that Mr Colgrave referenced objections to the application which were not later pursued and that it should have been apparent to both Visy Board and to Mr Colgrave that the respondent had no reasonable prospect of success in continuing to dispute the application.
[6] Mr Hardie sought that costs be awarded against either or both Visy Board or Mr Colgrave such that these costs were payable to Mr Bormann and/or to the AMWU.
[7] Mr Colgrave’s position was that the basis for a costs order against Visy Board or himself had not been made out and that the application should be dismissed.
[8] In considering the costs application I have had regard to both the proceedings on 21 April 2011 and all of the material put to me in the proceedings on the merits of the application.
The costs application
[9] As a matter of convenience I have initially considered whether a costs order should be made pursuant to s.611. This section states:
“611 Costs
(1) A person must bear the person’s own costs in relation to a matter before FWA.
(2) However, FWA may order a person (the first person) to bear some or all of the costs of another person in relation to an application to FWA if:
(a) FWA is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or
(b) FWA is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.
Note: FWA can also order costs under sections 376, 401 and 780.
(3) A person to whom an order for costs applies must not contravene a term of the order.
Note: This subsection is a civil remedy provision (see Part 4-1).”
[10] As I have indicated, there are two aspects to the costs claim. Not only does Mr Bormann seek costs but so too does the AMWU.
[11] I do not consider that there can be any award of costs to the AMWU as Mr Bormann’s representative. The AMWU was not a person able to make the application, as required by section 611(2)(a). The substantive application was filed pursuant to section 394 of the FW Act. Section 394(1) states that a person who has been dismissed may apply to FWA for an order. It was clearly Mr Bormann who was dismissed from his employment Visy Board. The AMWU merely filed the section 394 application on behalf of Mr Bormann and as his representative. Its actions in representing Mr Bormann reflected a member service and I cannot read into s.611 any capacity for consideration of costs which may have been incurred by the AMWU in representing Mr Bormann. Even if I were wrong in that finding, I do not consider, for reasons which I will explain subsequently, that the conduct of Visy Board falls within s.611(2)(a) or (b).
[12] In terms of the application for costs to be awarded to Mr Bormann, I am not satisfied that Mr Bormann incurred costs of a nature covered by s.611. There is no dispute that Mr Bormann was represented without charge by the AMWU. Further, at the time of the termination of his employment, and indeed up to the present time, he has not, and is not able to undertake his normal duties and Mr Bormann has no payment entitlements due from Visy Board. In summary, Mr Bormann quite simply did not incur any costs of the nature envisaged by s.611.
[13] I do not consider that s.611 can be applied to remunerate Mr Bormann for attendance at the AMWU offices or, for that matter, the Fair Work Australia proceedings.
[14] Irrespective of this, s.611(1) makes it clear that the parties to these proceedings will generally bear their own costs. The exception to this is dependent on the circumstances in s.611(2) being made out. I am not satisfied that the Visy Board response to Mr Bormann’s application was made vexatiously or without reasonable cause. The issues before me were arguable. Further, I am not satisfied that it should have been reasonably apparent to Visy Board that it had no reasonable prospect of success.
[15] The satisfaction required to enliven consideration of a costs order against a party goes beyond demonstrating the rejection of a settlement proposal which was in terms which were ultimately granted. It requires satisfaction that the other party’s actions were inherently unreasonable. I am not satisfied that this circumstance has been made out. The Visy Board position was an arguable proposition in so far as it was founded on Mr Bormann’s sustained incapacity to undertake work. As I observed in my decision, the unfairness associated with the termination of his employment had much to do with communications between Mr Bormann and Visy Board. These communications were considered in the proceedings before me. My conclusion on the merits did not disclose that the Visy Board position was made on a vexatious or unreasonable basis or that Visy Boards actions were unreasonable. Further, nothing has been put to me in the course of the costs proceedings, so as to establish these prerequisites for the consideration of a costs order.
[16] Section 401 states:
“401 Costs orders against lawyers and paid agents
(1) If FWA has granted permission in accordance with section 596 for a person to be represented by a lawyer or paid agent in a matter arising under this Part before FWA, FWA may make an order for costs against the lawyer or paid agent if FWA is satisfied:
(a) that:
(i) the lawyer or paid agent caused costs to be incurred by the other party to the matter because the lawyer or paid agent encouraged the person to start or continue the matter; and
(ii) it should have been reasonably apparent that the person had no reasonable prospect of success in the matter; or
(b) that the lawyer or paid agent caused costs to be incurred by the other party to the matter because of an unreasonable act or omission of the lawyer or paid agent in connection with the conduct or continuation of the matter.
(2) FWA may make an order under this section only if the other party to the matter has applied for it in accordance with section 402.
(3) This section does not limit FWA’s power to order costs under section 611.”
[17] Again, I do not consider that s.401 establishes any basis upon which the AMWU is capable of achieving an order relative to its costs as Mr Bormann’s representative. It was not a party to the proceedings in its own right and appeared simply as a representative. Section 401 is specific in that the reference to the “other party” can only refer to Mr Bormann.
[18] Secondly, I am not satisfied that Mr Bormann incurred costs of a nature which could be countenanced pursuant to s.401. He did not pay for representation and there is no argument that he was financially disadvantaged.
[19] Thirdly, I am not satisfied that the involvement of Mr Colgrave caused costs by encouraging Visy Board to continue the matter. He did not advance arguments that were clearly doomed to fail.
[20] An important consideration in my decision on the merits of the application related to exactly what advice Mr Bormann was given when he was stood down from his employment. The evidence in that respect was more fully disclosed in the course of the hearing such that I can discern no unreasonable act or omission on the part of Visy Board’s legal representatives.
Conclusion
[21] For the reasons set out above the application for costs must be dismissed. An Order [PR509381] reflecting this decision will be issued.
SENIOR DEPUTY PRESIDENT
Appearances:
T Hardie “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) for Mr Bormann.
I Colgrave counsel for Visy Board Pty Ltd.
Hearing details:
2011.
Adelaide:
April 21.
1 [2011] FWA 1569
Printed by authority of the Commonwealth Government Printer
<Price code C, PR509358>
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