Todd Brown v Kingskipp Pty Ltd as trustee for the RJ King Family Trust T/A Gateway Printing

[2017] FWC 2119

[2017] FWC 2119

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Todd Brown
v
Kingskipp Pty Ltd as trustee for the RJ King Family Trust T/A Gateway Printing
(U2016/10168)

COMMISSIONER HARPER-GREENWELL MELBOURNE, 13 APRIL 2017

Application for costs pursuant to section 611 of the Fair Work Act 2009 - costs not awarded.

[1] An application pursuant to section 611 of the Fair Work Act 2009 (the Act) seeking an order for costs against Mr Todd Brown was made by Kingskipp Pty Ltd as trustee for the R J King Family Trust trading as Gateway Printing (Gateway Printing).

[2] Mr Todd Brown was employed as a Production Team Leader with Gateway Printing on 4 June 2015 prior to his termination on 11 July 2016.

[3] Mr Brown lodged his unfair dismissal application pursuant to section 394 of the Fair Work Act 2009 (Cth) (the Act) on 11 August 2016, 31 days after his dismissal took effect.

[4] The matter was the subject of a jurisdictional hearing before me by telephone on 23 September 2016. The application was dismissed and reasons for the decision were published on 3 October 2016. 1

[5] On 29 September 2016 Gateway Printing filed a Form F6 applying for costs in the amount of $1980.00.

[6] On 25 October 2016 my chambers issued the following directions to the parties;

a) Gateway Printing shall file in the Commission and serve on Mr Brown written submissions and any other materials upon which it wishes to rely on in support of its cost application by no later than 5:00pm Tuesday, 8 November 2016.

b) Mr Brown shall file in the Commission and serve on Gateway Printing written submissions and any other materials upon which he wishes to rely by no later than 5:00pm Tuesday, 22 November 2016.

c) Gateway Printing shall file in the Commission, and serve on Mr Brown, a written submission in reply by no later than Tuesday, 6 December 2016.

[7] These directions also stated that in the absence of any request to my chambers by Thursday 8 December 2016 for a hearing, the matter would be determined on the papers. Neither party made a request to have a hearing before the Commission.

[8] Gateway Printing filed submissions in relation to the costs application on 4 November 2016, complying with the directions of the Commission.

[9] Mr Brown did not file any submissions, failing to comply with the directions.

[10] On 8 December 2016 my Associate sent correspondence directing Mr Brown to contact my chambers by 5:00pm on 9 December 2016 to advise whether he had any intention to file written submissions. The attempts made by my Associate to contact Mr Brown were unsuccessful and there has been no further correspondence received from Mr Brown.

The power to award costs

[11] The Commission has the discretionary power to award costs against a party to an unfair dismissal matter if it is satisfied that the party caused the other party to incur costs by an unreasonable act or omission in connection with the conduct or continuation of the matter. However the presumption of the Act is that each party bears their own costs.

[12] In its application, Gateway Printing relied on s.611 of the Act, which sets out the general provisions as to when costs may be ordered, and s.400A of the Act, which deals with costs specifically incurred by a party in unfair dismissal proceedings.

[13] Section 611 of the Act provides as follows:

“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.

(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).”

[14] Section 400A of the Act provides as follows:

“400A Costs orders against parties

(1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter.

(2) The FWC may make an order under subsection (1) only if the other party to the matter has applied for it in accordance with section 402.

(3) This section does not limit the FWC’s power to order costs under section 611.”

[15] Section 402 of the Act provides that an application for costs under s.611 and s.400A must be made within 14 days after the matter is determined by the Commission. Gateway Printing’s cost application was made within the specified time period. Accordingly s.402 of the Act is satisfied.

Submissions of Gateway Printing

[16] Gateway Printing submits they are applying for $1980.00 in legal costs in relation to Mr Brown’s unfair dismissal application. Gateway printing submits they were put to the expense of defending legal proceedings which they say were commenced with vexation and without reasonable cause.

[17] Further, Gateway Printing submits Mr Brown’s application had no reasonable prospects of success because it was lodged out of time, he was a casual employee and he had been dismissed for serious misconduct.

[18] The submission asserts that Mr Brown provided information on his Form F2 which was deliberately deceptive and misleading. He stated that his dismissal took effect on 22 July 2016 when he was actually dismissed on 11 July 2016.

[19] The Form F6 application of Gateway Printing includes the following additional submissions:

• Mr Brown failed to provide an explanation for the delay in lodging his application which would meet the exceptional circumstances requirement of the Act;

• Mr Brown did not provide details in question 3.2 on his Form F2 supporting his claim that his dismissal was harsh, unjust or unreasonable for the purpose of Part 3-2 of the Act;

• Gateway Printing have had to spend considerable time, energy and resources responding to Mr Brown’s false allegations, including involvement with the Fair Work Ombudsman and mediation where it was confirmed that they had fully complied with all of their obligations and statutory entitlements; and

• Mr Brown was placed on notice on 31 August 2016 and 4 September 2016 that Gateway Printing would seek to recover costs pursuant to s.401 and s.611 of the Act.

Consideration

Section 611 of the Act

[20] Section 611(1) of the Act expresses the prima facie assumption that a party will bear their own costs in relation to a matter before the Commission. Pursuant to s.611(2) of the Act, the Commission can exercise its discretion to override this prima facie assumption and order a party to bear some or all of the costs of another party in relation to an application to the Commission is enlivened only if the application was made:

• Vexatiously (s.611(2)(a));

• Without reasonable cause (s.611(2)(a)); or

• In circumstances in which it should have been reasonably apparent to Mr Brown that the application had no reasonable prospect of success (s.611(2)(b)).

[21] In Nilsen v Loyal Orange Trust 2 North J observed that the concept of vexatiousness is to be narrowly construed. His Honour stated that the question of whether an application was made vexatiously looks to the motive of the applicant in making the application. An application is made vexatiously where the predominant purpose is to harass or embarrass the other party or to gain a collateral advantage.3 This analysis was supported by the Full Bench in Church v Eastern Health.4

[22] It is well accepted by decisions of this Commission the term ‘without reasonable cause’ is not enlivened simply because a party’s argument proves unsuccessful. 5 The test is whether the application by the party should not have been made, that is whether the proceedings bought by the applicant had a reasonable prospect of success at the time they were instituted and not whether they ultimately failed.6 In Kanan v Australia Postal and Telecommunications Union, Wilcox J described the test in the following terms:

“29. It seems to me that one way of testing whether a proceeding is instituted “without reasonable cause” is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceeding, 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 stigmatise the proceeding as being “without reasonable cause”. But where it appears that, on the applicant’s own version of the facts, it is clear that the proceeding must fail, it may properly be said that the proceeding lacks a reasonable cause…” 7

Was the application made vexatiously or without reasonable cause?

[23] Mr Brown was a casual employee who had worked for Gateway Printing for just over a year. Mr Brown was contracted to work a minimum of 20 hours per week and a maximum of 40 hours per week over 6 days of the week. From time to time Mr Brown was required to work additional hours outside of his standard hours of work to enable Gateway Printing meet its production demands.

[24] Mr Brown’s Form F2 application states he was dismissed on 8 July 2016 and that dismissal did not take effect until 22 July 2016.

[25] The evidence put before me by Mr Brown during the jurisdictional hearing was that he was notified of his dismissal, which was to take immediate effect, in a meeting with Mr King on 11 July 2016. Mr Brown gave further evidence that:

• He was informed at that meeting he was no longer employed by Gateway Printing;

• Gateway had breached his employment contract by terminating him without notice;

• He did not perform any duties for Gateway Printing after the date he was notified of his dismissal; and

• He was informed that he would be paid in lieu of notice.

[26] It was Mr Brown’s evidence at the hearing on 23 September 2016 that the dismissal did take immediate effect. However, it was Mr Brown’s belief that as he was advised that he would be paid in lieu of notice, his date of dismissal would take effect at the end of the notice period and not immediately.

[27] After his dismissal Mr Brown received a letter from Gateway Printing stating he would be paid two weeks in lieu of notice. Gateway Printing submitted the letter was sent in error and there subsequently was no payment in lieu of notice made to Mr Brown.

[28] It was not disputed that Gateway Printing communicated to Mr Brown that the dismissal would take effect on 11 July 2016 and he received paperwork detailing his separation payment which included reference to a payment of $2,280 for two weeks in lieu. 8

[29] Mr Brown presented at the jurisdiction hearing as a plain and uncomplicated individual who had some difficulty in understanding the information being provided to him. Mr Brown strongly believed, as he had received paperwork stating he would receive an additional two weeks’ pay, he was entitled to those monies and made applications to both the Fair Work Ombudsman and the Commission in an attempt to recover what he believed were his entitlements.

[30] It is clear on the evidence put before me in the jurisdictional hearing that Mr Brown was advised his employment was to end on 11 July 2016. However due to the paperwork he had received, Mr Brown had formed the mistaken belief that because he would be paid in lieu of notice his dismissal took effect on 22 July 2016.

[31] It does not follow that Mr Brown was motivated by the intention of engaging with the Commission in a manner that was vexatious with the intent to harass or embarrass the other party or to gain a collateral advantage.

[32] On the evidence before me, I do not believe that Mr Brown had any other motive in pursuing his dismissal. It was Mr Brown’s belief that he was entitled to be provided with a payment of notice from his dismissal and, as he wasn’t paid that notice, his dismissal was unfair. On that basis I do not find Mr Brown to have made a vexatious application.

[33] In considering whether Mr Brown pursued his application ‘without proper cause’ an assessment needs to be made as to whether the application had no reasonable prospects of success, and if objectively, that fact should have been reasonably apparent to Mr Brown.

Should it have been reasonably apparent to Mr Brown that the application had no reasonable prospect of success?

[34] Mr Brown made submissions during the jurisdiction hearing that he had disputed the matter with the Fair Work Ombudsman and he was told at the time he could make an application to dispute his dismissal with the Commission. However, he did not make the application at the time because he didn’t know that he could run the matters concurrently.

[35] Mr Brown also made submissions that once he was advised by the Ombudsman that the respondent had complied with their obligations he then took advice from an employment law centre on the 9 August 2016. He submits he was advised to lodge an application for remedy of his unfair dismissal with the Commission.

[36] The issue contested at the hearing on 23 September 2016 was the date that Mr Brown’s dismissal took effect; this had bearing on the outcome as to whether or not his application was made out of time.

[37] Mr Brown was not aware his application would not succeed at the time of lodging his application. The advice Mr Brown had received was that he could pursue a claim with the Commission and not that he would be unsuccessful in his application.

[38] Gateway Printing submit that it should have reasonably been known to Mr Brown that his application would not succeed because he was a casual and he was dismissed for misconduct.

[39] The jurisdiction hearing did not deal with the matter of whether or not Mr Brown was a regular and systematic casual who would have been covered by the unfair dismissal provisions of the Act. Nor did I make a finding in relation to whether there was a valid reason for his dismissal. On the materials before the Commission it is difficult to determine whether Mr Brown’s matter would have had a reasonable prospect of success had an extension of time been granted.

[40] Upon the facts apparent to Mr Brown at the time of making his application, there was no substantial information before him in relation to his unfair dismissal claim that would indicate to him that he was likely to be unsuccessful, especially given there was a dispute as to the date his dismissal took effect.

[41] Mr Brown cannot be said to have made an application ‘without reasonable cause’ within the meaning of s.611(2)(a) simply because his application was not granted an extension of time. As previously stated the test is not whether the application might have been successful, but whether the application should not have been made. On Mr Brown’s own version of the facts, it was not clear that the proceedings would ultimately fail.

Conclusion

[42] In the decision of Meys v Sawtell Hotel, Vice President Catanzariti stated:

“[50] … It is not the role of this Commission to exercise its discretion to issue a costs order in lieu of the prima facie assumption that a party will bear its own costs – an assumption which the authorities require me to cautiously adhere to – when to do so would inflict additional financial and emotional hardship on an already vulnerable self-represented Applicant who has not acted vexatiously, unreasonably or in bad faith.”  9

[43] I have considered Gateway Printing’s submission, including those that Mr Brown deliberately and deceptively provided misleading information on his form F2 Application by providing the wrong date for his dismissal. I am satisfied Mr Brown provided a reasonable explanation for why he had provided the two sets of dates within his application to the Commission. I am not persuaded that Mr Brown’s motivation was to be deliberately deceptive or misleading.

[44] I am not satisfied that Mr Brown’s application was made vexatiously or without reasonable cause. Nor am I satisfied that it should have been reasonably apparent to him that his application had no reasonable prospect of success. Therefore, I have no jurisdiction pursuant to s.611 of the Act to order costs.

[45] I accept that Gateway Printing incurred some costs in having to prepare to defend proceedings in this matter. I also accept that I did not grant Mr Brown an extension of time in lodging his application for an unfair dismissal claim.

[46] However I am not satisfied that it was unreasonable for Mr Brown to instigate proceedings. I am not persuaded that s.400A of the Act is enlivened and therefore I have no jurisdiction to order costs pursuant to s.400A of the Act.

[47] Further to the above, I note that even if the jurisdiction to order costs pursuant of s.611 or 400A was enlivened, I would decline to order costs in this case as a matter of discretion. This is because, as I noted earlier in the decision, it was obvious to me that as a self-represented applicant Mr Brown struggled to understand some of the basic propositions put to him during the hearing of his application and he did not fully understand the technical aspects of the jurisdictional hurdle he had to overcome in order for his matter to proceed. Mr Brown was suffering financial difficulties and was merely attempting to pursue what he thought were his rightful entitlements.

[48] For the reasons given, Gateway Printing’s application for costs pursuant to s.400A and s.611 of the Act is dismissed.

COMMISSIONER

 1   [2016] FWC 6974

 2 [1997] 76 IR 180 at 181

 3   Ibid

 4   [2014] FWCFB 810

 5   Mitchell v Kellogg Brown & Root Pty Ltd[2016] FWC 8753 at [9]

 6 R v Moore; Ex Parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470

 7 [1992] FCA 539 at [29]

 8   Exhibit A1; Exhibit R1

 9   [2016] FWC 5561

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<Price code C, PR591874>