Treasurer for the State of South Australia v United Trades and Labour Council (Trading as SA Unions) (No 2) - [2020] SASCFC 53

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
TREASURER FOR THE STATE OF SOUTH AUSTRALIA & ORS v UNITED TRADES AND LABOUR COUNCIL (TRADING AS SA UNIONS) (No 2)
[2020] SASCFC 53
Judgment of The Full Court
(The Honourable Chief Justice Kourakis, The Honourable Justice Stanley and The Honourable Justice Parker)
22 June 2020
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - DEPRIVING SUCCESSFUL PARTY OF COSTS - NATURE OF PROCEEDING - OTHER CASES
INDUSTRIAL LAW - SOUTH AUSTRALIA - APPEALS AND REFERENCES - REFERENCES
Application for costs by the appellants.
The appellants succeeded on appeal to the Full Court from a decision of the Full Bench of the South Australian Employment Tribunal (the Tribunal). This Court held that it was not within the power of the Tribunal to make a declaration and order increasing the maximum amount of recreation leave loading prescribed by the Public service (Recreation Leave Loading) Award (SA) pursuant to s 100 of the Fair Work Act 1994 (SA).
The appellants sought an order for their costs of the appeal, pursuant to s 68(3)(c) of the South Australian Employment Tribunal Act 2014 (SA), as a consequence of the usual rule. The respondent opposed the application and submitted there should be no costs order made.
Held per curiam:
1. The power to award costs on appeal is to be exercised judicially in accordance with general principles, but considerations of an industrial nature might justify departure from the usual rule that costs follow the event.
2. The proceedings before the Tribunal are of a quintessentially industrial nature. The statutory mechanism engaged is designed to avoid industrial disputes, and to that extent the mechanism performs an arbitral function.
3. No order as to costs will be made.
South Australian Employment Tribunal Act 2014 (SA) s 68, s 68(3)(c); Fair Work Act 1994 (SA); Public Service (Recreation Leave Loading) Award , referred to.
Advance Resource Services Pty Ltd t/as Progress Couriers and Taxi Trucks v Charlton (2008) 100 SASR 388, applied.

TREASURER FOR THE STATE OF SOUTH AUSTRALIA & ORS v UNITED TRADES AND LABOUR COUNCIL (TRADING AS SA UNIONS) (No 2)
[2020] SASCFC 53
Full Court: Kourakis CJ, Stanley and Parker JJ

THE COURT: The appellants succeeded on appeal to this Court from a decision of the Full Bench of the South Australian Employment Tribunal (the Tribunal). The question on appeal was whether it was within the power of the Tribunal to make a declaration and order increasing the maximum amount of recreation leave loading prescribed by the Public Service (Recreation Leave Loading) Award (SA) pursuant to s 100 of the Fair Work Act 1994 (SA) (Fair Work Act).
The appellants sought an order for the costs of the appeal pursuant to s 68(3)(c) of the South Australian Employment Tribunal Act 2014 (SA) (Employment Tribunal Act).
The respondent opposed the application and submitted that there be no order as to costs.
For the reasons that follow, we consider that the appropriate order is that there be no order as to costs.
The appeal was brought pursuant to s 68 of the Employment Tribunal Act. Section 68(3)(c) provides that this Court, on appeal from the Full Bench of the Tribunal, may make “consequential or related orders (including orders for costs)”.
There can be no doubt that s 68(3)(c) confers upon this Court a discretionary power as to costs.
The principles governing the exercise of that discretion are informed by the reasons of this Court in Advance Resource Services Pty Ltd t/as Progress Couriers and Taxi Trucks v Charlton[1] which considered the costs provision in s 185 of the Fair Work Act which provided for the power of the Industrial Relations Court to award costs in proceedings based on a monetary claim. Section 185[2] was a provision of limitation which proscribed an award of costs in proceedings based on a monetary claim except in two circumstances, including, relevantly, an award of costs on appeal.
[1] [2008] SASC 118, (2008) 100 SASR 388.
[2] Since repealed.
In Charlton this Court held that the power to award costs on appeal was to be exercised judicially in accordance with general principles, but that considerations of an industrial nature might justify departure from the usual rule that costs follow the event.
Doyle CJ said:[3]
The exercise by the Industrial Court of its jurisdiction in respect of a “monetary claim” on occasions may give rise to considerations of an industrial nature that will be relevant to the exercise of the power conferred by s 185(b). Such considerations might persuade the court not to apply what is often called the “usual rule”, that costs follow the event.
By considerations of an industrial nature I mean the circumstances from which the claim arose, and in particular the circumstance that a claim might arise from a background of industrial disputation or unrest, or might be intended to resolve such disputation or unrest by settling an issue that affects a number of employers or a number of employees or both. Such circumstances might, in a particular case, be a reason not to follow the “usual rule”.
In short, I consider that the power conferred by s 185(b) is to be exercised in accordance with principles that have been applied to other generally expressed powers in relation to the award of costs. To say that is not to deny that in a particular case circumstances may arise that are particular to the case, or are linked to the nature of the jurisdiction that the Industrial Relations Court exercises, that might justify a departure from the “usual rule” that costs follow the event.
[3] [2008] SASC 118 at [14]-[16], (2008) 100 SASR 388 at 392.
Bleby J said:[4]
[4] [2008] SASC 118 at [137] and [139], (2008) 100 SASR 388 at 415.
So far as the power to award costs is concerned, industrial legislation in this State has always distinguished between arbitral and dispute settling functions, on the one hand, and judicial functions on the other. In the case of the former, it has from time to time limited the right to legal representation and, where that has been permitted, it has always been at the cost of the party concerned, with no power to award costs of such representation. In the case of the latter, legal representation has always been permitted, and the discretion to award costs, with some statutory exceptions, has remained unfettered.
…
In circumstances where the court has had an unfettered discretion to award costs, the only circumstances in which it has declined to award costs to a successful party for reasons not immediately connected with the conduct of the litigation have been where the litigation in question has been seen as an adjunct, or as being incidental, to the dispute settling or prevention or arbitral functions of the Commission or (before 1966) of itself. It has therefore declined to award costs to a successful party where:
•    the litigation has been incidental to its or to the Commission’s supervision of industrial associations;
•    the litigation has involved a question of the interpretation of an award or of legislation with immediate “industrial” consequences;
•    the litigation has been properly characterised as part of a wider dispute settling or dispute prevention process;
•   between 1972 and 1984, in exercising the unfair dismissal jurisdiction, in circumstances where there were wider industrial ramifications.
In other litigation of an inter-partes nature the court has exercised the discretion according to principles well established in courts of common law.
Layton J, who was in dissent on the question of whether costs should have been awarded by the Full Court of the Industrial Relations Court, but who took the same approach as Doyle CJ and Bleby J to the question of principle, said:[5]
In summary, having regard to the legislative history, the case law and the specific legislative provisions in s 185(b) of the FWA, the following approach to costs is indicated. If a monetary claim is simply an inter-partes proceeding between individual parties, then it is appropriate for costs on appeal to follow the common law principles and costs usually follow the event. However, if on the facts of the case there are industrial features such that the proceedings are not appropriately characterised as inter-partes proceedings, then the application of common law principles may not be appropriate.
The industrial features which have been recognised in past cases as attracting a different approach are when the proceedings have arisen in circumstances of industrial disputation or unrest; or in circumstances where conciliation was at the forefront; or where the proceedings have a broader interest and impact other than simply the outcome in the individual case; or where an order for costs may be anomalous or have a capricious effect on an unrepresented party having to pay the costs of legal representation of the successful party. These are to be considered collectively as part of the exercise of the discretion of the Industrial Relations Court and not simply applied as individual criteria. These are not limiting criteria and the Industrial Relations Court and the Industrial Relations Commission, exercising as they do a specialised jurisdiction, are better placed to identify other relevant industrial features. I particularly refer to the last-mentioned feature of the economic burden of an adverse costs order. This feature on its own would not be regarded as an industrial feature such that it would attract a different approach on costs. It is one matter which is relevant to the exercise of discretion if other features of an industrial nature are present.
[5] [2008] SASC 118 at [261]-[262], (2008) 100 SASR 388 at 444.
While Charlton was concerned with a different statutory provision the reasoning adopted by the Court is equally applicable to the operation of s 68(3)(c) of the Employment Tribunal Act.
The appellants submitted that the Court should order that the respondents pay the costs of the appeal in accordance with the usual rule that costs follow the event. They submitted that there is no occasion to depart from the usual rule, which should only occur in exceptional circumstances, typically where there is disentitling conduct of a party. That was not the case here. The question on appeal was one of construction. This Court broadly accepted the construction for which the appellants contended in what was essentially an inter-partes dispute. This was an exercise of judicial rather than arbitral power. The appellants had a direct financial interest in the litigation given the financial impact to the State of the increase in the maximum recreation leave loading. The respondent, as the representative body of employees in the State, had a direct interest in the appeal due to the financial interests of its public service members in the increase in the maximum recreation leave loading. Further, the appeal cannot be characterised as public interest litigation justifying departure from the usual rule.
In exercising the discretion as to costs conferred by s 68(3)(c) it is important to recognise the nature of the proceedings before the Tribunal. The proceedings were to determine the application of the national Fair Work Commission 2018 Annual Wage Review to the awards covering employees in this State bound by awards of the Tribunal. They are proceedings of the kind that have been conducted by the Tribunal or its predecessors on an annual basis for many decades. Historically, through these proceedings decisions of the Fair Work Commission or its predecessors have flowed on to wage rates of employees in this State whose wages have been fixed by State awards. Those proceedings, authorised by statute, are of a quintessentially industrial nature. The statutory mechanism providing for the flow on of wage increases to employees whose wages are fixed by State awards as a result of decisions of the Fair Work Commission (or its predecessors) in national wage cases is an arbitral function which is designed to avoid industrial disputation. The nature of the function is reflected in the fact that the proceedings pursuant to s 100 of the Fair Work Act were initiated by the Tribunal, albeit at the request of the respondent.
It is that character which brings this appeal within the exception in Charlton.
That conclusion does not render the proceedings as public interest litigation. The respondent is the peak union body in this State. It represents the interests of organised labour. Its role in these proceedings is to be understood in that representative character. The proceedings were pursued by the respondent in the interests of its affiliated unions and their members. Its role is partisan and its interest is sectional. In that circumstance, the proceedings were not brought in the public interest.
Nonetheless, because these proceedings fall within the Charlton exception, the Court considers that the appropriate exercise of the cost discretion is to order that there be no order as to the costs of the appeal.