Tilers Trade Outlet (Vic) Pty Ltd v Julia Cochrane
[2023] FWCFB 246
•12 DECEMBER 2023
| [2023] FWCFB 246 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.604—Appeal of decision
s.611—Costs
Tilers Trade Outlet (Vic) Pty Ltd
v
Julia Cochrane
(C2023/4839)
| JUSTICE HATCHER, PRESIDENT | SYDNEY, 12 DECEMBER 2023 |
Appeal against decision [2023] FWC 2071 of Commissioner Matheson at Sydney on 26 July 2023 in matter number C2023/2548 – permission to appeal refused – costs application by the respondent in the appeal.
Background
On 26 July 2023, Tilers Trade Outlet (Vic) Pty Ltd (Tilers Trade) lodged an appeal against a decision made by Commissioner Matheson on 26 July 2023[1] which concerned a jurisdictional objection raised by Tilers Trade in respect of an application made by Ms Julia Cochrane pursuant to s 365 of the Fair Work Act 2009 (Cth) (FW Act). Ms Cochrane alleged in her application that she was dismissed from employment with Tilers Trade in contravention of ss 340, 343, 344 and 351 of the FW Act. Tilers Trade contended at first instance that the Commission had no jurisdiction to hear the application as Ms Cochrane had failed to plead material facts in support of her application. The Commissioner dismissed this objection and allowed Ms Cochrane’s application to proceed under s 368 of the FW Act.
Both Tilers Trade and Ms Cochrane were granted permission for legal representation in the appeal pursuant to s 596(2) of the FW Act. In Tilers Trade’s notice of appeal, it contended in varying ways that Ms Cochrane did not submit a competent application in satisfaction of s 365(b) of the FW Act. In a decision issued on 29 September 2023, we refused permission to appeal.[2] In our appeal decision, we considered that all that is required for satisfaction of the criterion in s 365(b) of the FW Act is that an allegation be made that a person was dismissed in contravention of Part 3-1, and that the Commission is not required to undertake an assessment as to whether there have been facts pleaded which might reasonably support that allegation.[3] Therefore, we considered, as did the Commissioner at first instance, that Ms Cochrane’s application was valid.[4] We subsequently concluded that Tilers Trade had not advanced a reasonably arguable case that the Commissioner’s decision was attended by appealable error.[5]
On 11 October 2023, Ms Cochrane applied for her costs in respect of the appeal pursuant to s 611 of the FW Act. This decision is concerned with that application. Section 611 of the FW Act provides:
611 Costs
(1) A person must bear the person’s own costs in relation to a matter before the FWC.
(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:
(a)the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or
(b) the FWC 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: The FWC can also order costs under sections 376, 400A, 401 and 780. …
Principles for costs applications
Ms Cochrane’s costs application is advanced under both s 611(2)(a) and s 611(2)(b). We note that even if either subsection is satisfied, the Commission is not obliged to order costs. Whether costs are to be awarded at all, and the amount of any costs that are awarded, involves the exercise of a discretion.
In Hansen v Calvary Health Care Adelaide Limited,[6] a Full Bench said in relation to s.611 generally:
[15] It is trite to observe that the statutory and policy imperative underpinning a costs application under the Act, is that a person in a matter before the Commission must bear their own costs. So much is plainly obvious by the precise and unambiguous language of s.611(1).
[16] However, the statutory scheme sets out the relatively circumscribed circumstances in which an order for costs might be found by the Commission to be appropriate in a particular case. It includes the exercise of discretionary power where the Commission is satisfied that one, or more of the circumstances set out in s 611(2), has been established. If such circumstances are established, the Commission, in the broad exercise of its discretion, may make an order that a person/s bear some, or all of the costs of another person, in relation to the application, including on an indemnity basis, or decline to make any order at all.
The relevant principles concerning the interpretation and application of s 611(2)(a) were comprehensively stated in Church v Eastern Health t/as Eastern Health Great Healthand Wellbeing[7] and may be summarised as follows:
·An application is made vexatiously when the predominant motive or purpose of the applicant is to harass or embarrass the other party or to gain a collateral advantage.
·An application is not made without reasonable cause simply because the application did not succeed.
·Whether an application is made without reasonable cause may be tested by asking, on the facts apparent to the applicant at the time the application was made, whether there was no substantial prospect of success.
·If success depends upon the resolution in the applicant’s favour of one or more arguable points of law, it is inappropriate to characterise the application as having been made without reasonable cause.
·In relation to an appeal, the question becomes whether the appeal has no substantial prospect of success. The prospect of success must be evaluated in the light of the facts of the case, the judgment appealed from and the points taken in the notice of appeal. If there is a not insubstantial prospect of the appeal achieving some success, it cannot fairly be described as having been made without reasonable cause.
·An application will have been made without reasonable cause if it can be characterised as so obviously untenable that it cannot possibly succeed, is manifestly groundless or discloses a case where the tribunal is satisfied it cannot succeed.
In relation to s 611(2)(b), the relevant principles were summarised by the Full Bench
in Baker v Salva Resources Pty Ltd[8] as follows (footnotes omitted):
[10] The concepts within s.611(2)(b) ‘should have been reasonably apparent’ and ‘had no reasonable prospect of success’ have been well traversed:
·‘should have been reasonably apparent’ must be objectively determined. It imports an objective test, directed to a belief formed on an objective basis, rather than a subjective test; and
·A conclusion that an application ‘had no reasonable prospect of success’ should only be reached with extreme caution in circumstances where the application is manifestly untenable or groundless or so lacking in merit or substance as to be not reasonably arguable.
Submissions on costs
In her outline of submissions on costs, Ms Cochrane claims that Tilers Trade pursued the jurisdictional objection and subsequent appeal knowing there was no reasonable prospect of success, justifying an award of costs under s 611(2)(a) of the FW Act. Ms Cochrane submits that Tilers Trade was aware that the Commission was not a court of strict pleading, that the case precedent it cited did not provide support for its contention, that there is no requirement for an applicant to plead all material facts in a Form F8, and of the plain and literal meaning of ‘allegation’ as it appears in s 365 of the FW Act. Ms Cochrane also submits that Tilers Trade was aware at the time of making the jurisdictional objection that, amongst other things, the Form F8 she filed was largely completed, including the ticking of relevant boxes at question 3.2. Finally, Ms Cochrane submits that at the time of filing the notice of appeal, Tilers Trade was already aware that it had no authority to suggest there was any error in the decision at first instance and that there was no requirement for a primary explanation in a Form F8.
Ms Cochrane submits that it would have been reasonably apparent to an objective person that the jurisdictional objection and subsequent appeal had no reasonable prospect of success, as none of the authorities cited by Tilers Trade supported the conclusion that Ms Cochrane’s application was not competent. As to the exercise of the Commission’s discretion as it arises, Ms Cochrane submits that costs should be awarded because, among other reasons, she is an unemployed and impecunious individual that has incurred significant costs as a result of both the jurisdictional objection and the appeal.
At the outset of Tilers Trade’s submissions on costs, it notes that Ms Cochrane is seeking costs associated with the conciliation and preliminary steps, and the first-instance hearing on the jurisdictional objection. Tilers Trade objects to the former of these claims as Ms Cochrane has not made any submissions as to why the costs of the conciliation and preliminary steps fall within the jurisdiction and discretion of the Commission to award costs, and the fact that the conciliation would have occurred regardless. As for the latter, Tilers Trade submits that these should also be excluded as they have been claimed out of time, given the first-instance decision was issued on 26 July 2023 and Ms Cochrane did not file a Form F6 in relation to the first‑instance matter in the 14-day time limit as required by s 377.
In response to Ms Cochrane’s submissions on s 611(2)(a), Tilers Trade submits that there were legitimate but unsuccessful arguments as to the nature of whether a s 365 application required the Commission to look at the application as a whole or merely whether the relevant boxes were ticked at question 3.2 of a Form F8, and that this was not a situation in which the appeal must have failed. As for Ms Cochrane’s submissions on s 611(2)(b), Tilers Trade contends that no authorities existed that dealt with the precise point it sought to advance on appeal, and therefore no authority existed that showed its appeal was bound to fail. Moreover, as to the exercise of discretion as it arises, Tilers Trade submits that the Full Bench should refuse to make a costs order in circumstances where no authority exists to provide guidance on the points in contention, and where Ms Cochrane’s original application ‘contained indications of an unfair dismissal application in disguise’.
Consideration
We are satisfied, for the purpose of s 611(2)(a) of the FW Act, that Tilers Trade’s appeal in this matter was made without reasonable cause because the grounds of appeal and the grounds upon which permission to appeal was sought were simply untenable. We found at paragraph [28] of our appeal decision that the Commissioner at first instance reached her decision using an orthodox approach, that her conclusion was correct, and that Tilers Trade had not advanced a reasonably arguable case for appeal. Because we have reached the requisite state of satisfaction in respect of s 611(2)(a), it is not necessary for us to consider whether s 611(2)(b) also applies.
We consider that we should exercise our discretion in making an award of costs in Ms Cochrane’s favour. Ms Cochrane was put to unnecessary expense in responding to the appeal, and we consider that it was reasonable having regard to the nature of the issues raised by the appeal that Ms Cochrane obtain legal representation for the hearing of the appeal. In this respect, we take into account that Ms Cochrane sought permission for legal representation under s 596(2) of the FW Act prior to the hearing, that Tilers Trade did not oppose this application, and that we accordingly granted permission.
However, we agree with Tilers Trade’s submissions that our award of costs should be limited to only those in relation to the appeal. Ms Cochrane did not file a costs application within 14 days of the first-instance decision being issued, as required by s 377 of the FW Act. The Commission has no discretion to extend the amount of time given to costs applicants. Accordingly, we dismiss items 1 through 4 of the costs claimed by Ms Cochrane. Likewise, we consider that items 4 through 7 should also be dismissed as they relate to costs incurred in the preparation and attendance of the first-instance hearing on the jurisdictional objection.
We turn to the costs claimed for the appeal. Item 1302 of Sch 3.1 to the Fair Work Regulations 2009 (Cth) (FW Regulations) treats solicitors’ fees when acting as counsel as a disbursement which may be charged at ‘[a]n amount that the FWC considers to be fair and reasonable according to the circumstances of the case and the seniority of the solicitor.’ Taking into account that the matter was listed for hearing both in relation to permission to appeal and the merits of the appeal before a Full Bench, as well as the fact the appeal hearing ran for less than one hour, we propose to award $330.00 for Mr Kriewaldt’s appearance on behalf of Ms Cochrane, which is half the original claim for two hours’ appearance at item 17.
As for Ms Cochrane’s claim for pre-hearing and preparation costs, we consider that Tilers Trade was clearly on notice that Ms Cochrane was incurring costs for which it might be potentially liable, as it was copying in Mr Kriewaldt in correspondence starting on 24 August 2023 — some four weeks before the hearing. We therefore consider it appropriate to award some costs in respect of the pre-hearing work undertaken by Ms Cochrane’s representative.
Item 14 is a claim for the preparation of the respondent’s outline of submissions in the amount of $2,640.00. Ms Cochrane claims this is for one-and-a-half days’ of solicitor work for research and considerations of questions of law. Item 1201 of Sch 3.1 of the FW Regulations enables the Commission to allow an amount for general care and conduct, including research and consideration of questions of law, if it considers it reasonable in the circumstances of the case. Given that item 14 does not provide particulars as to work constituting the total hours claimed, and that the appeal did not raise any difficult or novel questions, we are not persuaded that the total fees of the solicitor were reasonably incurred. Moreover, we do not consider that the questions of law considered on appeal were particularly difficult or novel, so we decline to award costs in the amount claimed by Ms Cochrane. We will, however, award an amount representing four hours’ preparation at the rate of $330.00 per hour, in line with the hourly rate we considered at paragraph [15].
Item 16 is a claim for the preparation for the appeal hearing in the amount of $2,640.00, comprising a full-day’s work by the solicitor. For similar reasons to the above, and because no particulars were provided, we are not persuaded that these fees were reasonably incurred. This is especially so given the same amount was claimed only six days earlier for the preparation of the appeal submissions, and that the appeal, which was not particularly complex, was dispensed with in under an hour at hearing. We have decided to award an amount representing three hours’ preparation at the rate of $330.00 per hour.
Turning to the remainder of Ms Cochrane’s itemised list of costs:
·Item 8 is a claim for perusing the first-instance decision in the amount of $120.00 pursuant to item 601 of Sch 3.1 of the FW Regulations. Regulation 3.04(4) of the FW Regulations outlines that a folio equates to 72 words and a note in that subregulation states there are generally three folios per page. The first-instance decision was 11 pages long, containing about 10 pages of substantive content, and thus comprised approximately 30 folios. Item 601(b) allows the Commission to award costs at its discretion if an allowance for 30 or more folios is allowed for a document. We consider that an amount of $100.00 is reasonable for 30 folios, and we award it.
·Item 9 is a claim for perusing the notice of appeal in the amount of $16.00, which accords with item 601(a)(i) of Sch 3.1 of the FW Regulations for a document of up to 3 folios. We award this amount.
·Item 12 is a claim for perusing the Appellant’s appeal submissions, permission to appear submissions, amended notice of appeal and appeal book. We consider that the amount claimed of $200.00 is reasonable, and we award it.
·Items 10 and 15 are claims for a conference between solicitor and client in the amount of $120.00 each, which accords with item 1102 of Sch 3.1 of the FW Regulations for half-hour attendances. We award this amount each for both claims.
·Items 11 and 13 are claims for the preparation of necessary documents in response to directions given by the Commission. Item 203 of Sch 3.1 of the FW Regulations allows for $74.00 per document. We award this amount each for both claims.
Conclusion
Accordingly, we award costs in Ms Cochrane’s favour to the amount of $3,344.00 pursuant to s 611(2) of the FW Act. An order to give effect to this decision is published together with this decision.
PRESIDENT
[1] [2023] FWC 2071.
[2] [2023] FWCFB 170.
[3] Ibid at [23].
[4] Ibid at [24].
[5] Ibid at [28].
[6] [2016] FWCFB 8162.
[7] [2014] FWCFB 810, 240 IR 377 at [23]–[33].
[8] [2011] FWAFB 4014, 211 IR 374.
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