Tucker v State of Victoria [No 2]
[2021] VSCA 182
•23 June 2021
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2019 0091
S EAPCI 2020 0031
S EAPCI 2020 0041
| TOBIAS JOHN TUCKER | Appellant |
| v | |
| THE STATE OF VICTORIA | First Respondent |
| - and - | |
| PAUL BRODERICK (sued in his capacity as Commissioner of State Revenue) [No 2] | Second Respondent |
---
| JUDGES: | KYROU, McLEISH and SIFRIS JJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | On the papers |
| DATE OF JUDGMENT: | 23 June 2021 |
| MEDIUM NEUTRAL CITATION: | [2021] VSCA 182 |
| JUDGMENT APPEALED FROM: | [2019] VSC 420; [2019] VSC 481; [2020] VSC 121; [2020] VSC 192 (Ierodiaconou AsJ) |
---
COSTS – Special costs regime – Fair Work Act 2009 (Cth) s 570 – Whether conduct of parties amounted to unreasonable act or omission causing other party to incur costs – Conduct including failure to settle proceeding, bringing interlocutory applications and reliance on certain grounds of appeal – Discretion to award costs of appeal enlivened – Limited costs orders made in respect of appeals – No order as to costs of trial – Fair Work Act 2009 (Cth) s 570(2)(b).
---
| WRITTEN SUBMISSIONS: | Counsel | Solicitors |
| For the Appellant | In person | -- |
| For the First and Second Respondents | Mr J L Bourke QC with Ms R Preston | Maddocks |
KYROU JA
McLEISH JA
SIFRIS JA:
Introduction
The Court handed down judgment in these three appeals on 12 May 2021 and invited the parties to file written submission as to the costs of the appeals and of the proceeding in the Trial Division, which they have now done. These reasons should be read with our reasons in the substantive matters.[1]
[1]Tucker v State of Victoria [2021] VSCA 120 (‘Principal Reasons’).
In summary, using the terms defined in those reasons:
(a)The appellant’s applications for a stay and for leave to adduce further evidence were refused.
(b)The appellant’s application for an extension of time in relation to the Injunction Leave Application was granted.
(c)The Injunction Leave Application was granted and the appeal against the injunction judgment was allowed. A declaration was made that the respondents failed to conduct the Harassment Investigation in accordance with the procedural fairness requirements of cl 21.11(a) of the VPSEA and s 20(3)(c) of the PAA, read together with s 8(b). The injunction judgment was otherwise unaffected by the appeal.
(d)The Injunction Costs Leave Application was granted and the appeal against the injunction costs judgment was allowed. The associate judge’s orders as to the costs of the injunction application were set aside.
(e)The Damages Leave Application was granted in respect of ground 3 but was otherwise refused. The respondents’ contentions in their notice of contention were upheld only in relation to a notice to produce. The associate judge’s damages award (the subject of grounds 1 and 2) was not disturbed but her order for costs in respect of the Undertaking as to Damages was set aside (except in relation to the notice to produce).
(f)The appellant’s application for orders pursuant to ss 26 and 65A of the Civil Procedure Act 2010 (‘the CPA’) was refused.
For reasons already given, the proceeding in the Trial Division was ‘in relation to a matter arising under’ the Fair Work Act 2009 (Cth) (‘the FWA’) and therefore subject to the special costs regime for which s 570 of that Act provides.
Section 570 of the FWA relevantly provides as follows:
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) ...
…
(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
...
The parties accepted that our conclusion in respect of the Trial Division proceeding meant that the section applied also to the three appeals in this Court. That result follows from the fact that the appeals constituted proceedings for the purposes of s 570 and the appeals were in relation to the same matters as those which arose under the FWA in the Trial Division.
Both parties made submissions to the effect that unreasonable acts or omissions of the other party had caused them to incur costs, either at trial or on appeal, and that there should be an order in respect of those costs as a result. The flavour of some of the submissions was that aspects of the proceedings themselves were vexatious or lacked reasonable cause, but it was not submitted that the proceedings themselves were of that character, so as to attract s 570(2)(a). The arguments were addressed to s 570(2)(b).
The appellant also made submissions as to his position as a self-represented litigant and the operation of the decision of the High Court in Bell Lawyers Pty Ltd v Pentelow.[2] Since, for the reasons that follow, we would not in any event order the respondents to pay any costs of the appellant, those matters can be put to one side.
[2](2019) 93 ALJR 1007; [2019] HCA 29.
It is convenient to set out the parties’ submissions before turning to the application of s 570(2)(b) in this case.
Submissions as to costs
The appellant sought an order that the respondents pay his costs of the trial (other than the undertaking as to damages trial) and of the appeals, fixed at $298,002.26. The appellant relied on six instances of conduct on the part of the SRO which he alleged were unreasonable within the meaning of s 570(2)(b).
First, the appellant submitted that the litigation was triggered by the refusal of the SRO to provide him with the unredacted Harassment Report. He submitted that the reliance by the SRO on ‘privacy obligations’ for withholding the full report had been rejected by this Court and had been ‘disingenuous and arguably vexatious’.
Secondly, the appellant submitted that the position of the SRO that the proceeding was not ‘in relation to a matter arising under’ the FWA for the purposes of s 570 of the FWA (because the VPSEA was ‘simply a background matter’) had been untenable in fact and in law. The appellant submitted that the SRO had the benefit of expert legal representation of the highest quality and had persisted with an argument which it knew or ought to have known was bound not to succeed.
Thirdly, the appellant submitted that the SRO had refused to engage in mediation. It was said that refusal to mediate was unconscionable in circumstances where the SRO had demanded the appellant pay its costs in relation to the orders of the associate judge when the SRO knew, or ought to have known, that those orders would be set aside on appeal. Further, the SRO was said to have unreasonably refused to provide invoices supporting its demand for costs. The appellant submitted that the judicial registrar had erred in acceding to an application made by the SRO to set aside orders for mediation which had been made on 23 October 2019.
Fourthly, the appellant submitted that the SRO had failed to accept, or even consider, the appellant’s ‘settlement offers’. By the first of those offers, dated 28 June 2017, the appellant had offered to resign his employment to avoid any protracted dispute. The SRO had responded on 4 July 2017 to the effect that it did not intend to make any offers of any kind and would defend the proceedings if they continued. A second offer was made by the appellant on 19 December 2019 to withdraw his appeal and abandon all claims against the SRO in return for ‘the nominal sum of $40,000’. A third offer of settlement was made by the appellant on 31 March 2020 by which he would withdraw the Injunction Costs Leave Application for ‘the nominal sum of $20,000’ in circumstances where that application was said to be bound to succeed.
Fifthly, the appellant contended that the costs of the SRO, which he suggested include very substantial costs for external legal representation, were neither reasonable nor proportionate, particularly given the application of s 570 of the FWA to the proceedings.
Sixthly, the appellant submitted that the SRO had repeatedly breached the model litigant guidelines. This was said to be evident in the demand that the appellant pay the SRO its costs, its approach to settlement negotiations and its conduct in other, unrelated, cases.
The appellant submitted that the case was about vindication of his position following breaches by the SRO of his workplace rights. It was submitted that the appellant had ‘won the lion’s share of issues’. It was submitted that, consistently with the overarching obligation of the Court to effect justice as provided for in s 7 of the CPA, the appellant should, at the very least, be recompensed and indemnified for his ‘significant’ out of pocket expenses in the matter.
Further, the appellant submitted that the ‘power differential’ between himself and the SRO meant that the SRO should be held to higher standards than those of private litigants. It was submitted that the SRO had taken advantage of its power by spending more than ten times the amount the appellant did on the appeals, engaging in what were described as ‘questionable tactics’ as described above, opposing applications in the appeals including consolidation applications and the Injunction Costs Leave Application, issuing an offer of compromise said to be ‘meaningless’ and taking other positions and making submissions said to have been unreasonable.
The respondents submitted that the Court should make no further costs orders in respect of the proceeding in the Trial Division. They submitted that orders for costs should be made against the appellant on an indemnity basis in respect of costs incurred by reason of certain acts of the appellant in connection with the appeals which were said to be unreasonable within the meaning of s 570(2)(b) of the FWA. The respondents submitted that no costs orders should be made against them.
The respondents identified four acts on the part of the appellant which were submitted to be unreasonable in the relevant sense. First, it was submitted that the bringing of the further evidence application was unreasonable. The documents sought in that application were said to have overlapped to a significant extent with the documents the subject of the notice to produce which was set aside by the associate judge as lacking relevance or any forensic purpose. This Court had found the notice to produce to have been ‘wholly misconceived, bordering on vexatious’.[3] In addition, the application was accompanied by submissions alleging deliberate concealment of evidence, which were serious allegations tantamount to fraud, made without a proper evidentiary basis and not relevant to the appeals.
[3]Principal Reasons [452].
Secondly, the respondents contended that it had been unreasonable for the appellant to rely on grounds 1 and 2 in the Damages Leave Application. The Court found both of these grounds (concerning mitigation of damage and ‘unclean hands’ respectively) to be ‘entirely without merit’.[4] Further, it was contended that the grounds had been oppressive, vexatious and to some extent scandalous.
[4]Ibid [434].
Thirdly, the respondents submitted that making the application for a stay of the appeal proceedings pending the determination of the Federal Court defamation proceeding, and persisting with the application despite the defamation proceeding having been commenced later in time and there being no relevant overlap between the two proceedings, was a further unreasonable act which had caused the respondents to incur costs.
Fourthly, the respondents relied on the application made by the appellant under ss 26 and 65A of the CPA. It was said that the appellant had unreasonably asked this Court to determine an application that had already been resolved in favour of the respondents at trial, without attacking the correctness of that decision. The application was brought in circumstances where this Court found that ‘such orders would not provide any assistance to the applicant or to the Court in relation to the issues in the appeal proceedings’.[5] Both this Court and the associate judge had made clear that any argument that legal fees were excessive was appropriately dealt with as part of the taxation of costs. It was submitted that the application under the CPA formed part of an extensive and oppressive course of conduct by the appellant, which included insistence on the provision of invoices in advance of any mediation.
[5]Ibid [116].
The respondents submitted that orders for costs in respect of these matters should be made in each of the three appeal proceedings, on an indemnity basis.
The respondents also made submissions in opposition to the appellant’s arguments that they should pay costs in relation to the first instance and appellate proceedings.
Section 570 of the FWA
In a matter to which s 570(1) of the FWA applies, the Court lacks jurisdiction to award costs unless a paragraph of s 570(2) is satisfied. In that event, the Court’s discretion is enlivened and it may still decide not to order costs.[6]
[6]Australian Workers’ Union v Leighton Contractors Pty Ltd [No 2] (2013) 232 FCR 428, 431 [8] (Dowsett, McKerracher and Katzmann JJ) (‘Leighton Contractors’).
A relatively strict standard of ‘unreasonableness’ is applied in the context of s 570(2).[7] The standard (as it applied to an earlier version of the provision[8]) was described as follows in Construction, Forestry, Mining and Energy Union v Clarke:
As the authorities indicate, there is a distinction between a party who pursues arguments which are ultimately abandoned or rejected by the Court and a party who commences a proceeding which is misconceived in the sense of being incompetent or unsupportable. Simply because a party does not conduct its litigation in the most efficient way does not mean that the Court should exercise its discretion [in sub-s (2)] to make a costs order. ... Indeed, while courts should use the discretion in [sub-s (2)] to ensure that parties to litigation arising from the [Act] do not engage in unreasonable acts and omissions which put the other party to undue expense, they should also be careful not to exercise the discretion with too much haste, given that such haste may discourage parties, for fear of an adverse costs order, from pursuing litigation under the [Act] in the manner which they deem best.[9]
[7]Celand v Skycity Adelaide Pty Ltd (2017) 256 FCR 306, 342–3 [165] (Bromberg J).
[8]Workplace Relations Act 1936 (Cth) s 824: see Principal Reasons [379]–[380] nn 144, 147.
[9](2008) 170 FCR 574, 582 [29] (Tamberlin, Gyles and Gilmour JJ) (citations omitted) (‘Clarke’).
Similarly, to avoid discouraging parties pursuing claims arising under the FWA in a ‘complete and robust way’, it has been said that the discretion conferred by s 570(2) is to be ‘exercised cautiously’ and only in cases where the ‘case for its exercise is clear’.[10]
[10]Ryan v Primesafe (2015) 323 ALR 107, 122 [64] (Mortimer J); [2015] FCA 8 (‘Ryan’).
The meaning of para (b) is to some extent influenced by the terms of para (a). While there is some overlap between the criteria, they address different subject matters. Paragraph (a) asks whether the proceeding has been unreasonably or vexatiously brought; para (b) asks whether there has been an ‘inherently unreasonable’ act in the conduct of a proceeding that has not been unreasonably brought which nonetheless caused the other party to incur costs.[11]
[11]Tran v Kodari Securities Pty Ltd [No 2] [2020] FCA 1819, [27] (Bromwich J).
The scope for overlap between the paragraphs means that submissions (and judicial analysis) framed in the language of one of the paragraphs might better be understood in terms of the other.[12] Here, for example, the proceedings themselves were said in some respects to have been instituted vexatiously or without reasonable cause. In determining whether para (b) applies in such circumstances, it is relevant to consider whether the proceedings were, in the relevant respect, instituted vexatiously or without reasonable cause.
[12]See, eg, Morton v Commonwealth Scientific and Industrial Research Organisation [No 3] [2019] FCA 1943, [25] (Rangiah J); One Stop Warehouse Pty Ltd v Oldfield [2021] FCA 34, [6] (Reeves J) (‘One Stop’); Ryan (2015) 323 ALR 107, 125 [75] (Mortimer J).
It is convenient briefly to summarise the approach to be taken to each paragraph.
Section 570(2)(a) asks whether a party has instituted the proceedings ‘vexatiously or without reasonable cause’. The following principles emerge from the authorities:
(a) The purpose of s 570(2)(a) is to protect parties from the risk of adverse costs in matters arising under the FWA, while also affording costs protection to parties forced to defend proceedings instituted vexatiously or without reasonable cause.[13]
[13]Leighton Contractors (2013) 232 FCR 428, 430–1 [7] (Dowsett, McKerracher and Katzmann JJ).
(b) A proceeding will have been instituted vexatiously if it is scandalous, oppressive, embarrassing, discloses no reasonable cause of action, or is otherwise an abuse of the process of the Court.[14]
[14]Trustee for the MTGI Trust v Johnson [No 2] [2016] FCAFC 190, [10] (Siopis, Collier and Katzmann JJ) (‘MTGI Trust’); Garrett v Commissioner of Taxation (2015) 147 ALD 342, 343–4 [4] (Pagone J); [2015] FCA 117.
(c) A proceeding will have been instituted without reasonable cause if the proceeding lacked reasonable prospects of success at the time it was instituted, having regard to the facts apparent to the instituting party at that time.[15] The focus is on the circumstances of the commencement of the proceeding; the manner in which the proceeding is conducted after it is commenced is irrelevant to para (a) but is instead relevant to para (b).[16]
(d) That the proceeding ultimately fails is not decisive. Nor is it enough that a proceeding is merely misconceived.[17] However, a proceeding will lack reasonable prospects of success where, on the instituting party’s own version of the facts, it is doomed to fail.[18]
(e) Where the proceeding at issue is an appeal, the above test as to the absence of reasonable cause applies with minor modifications. The relevant enquiry is whether, having regard to the facts apparent to the applicant at the time of instituting the appeal there were no reasonable prospects of success. In evaluating those prospects, regard may be had to the reasons for judgment or decision under appeal and the grounds relied on to challenge the judgment or decision.[19]
[15]Baker v Patrick Projects Pty Ltd [No 2] (2014) 145 ALD 548, 550 [9] (Dowsett, Tracey and Katzmann JJ); [2014] FCAFC 166 (‘Baker’); Construction, Forestry, Mining and Energy Union v Corinthian Industries (Australia) Pty Ltd [No 2] [2014] FCA 351, [8] (Pagone J).
[16]Morris v McConaghy Australia Pty Ltd [2018] FCA 2099, [4]–[6] (Perram J).
[17]One Stop [2021] FCA 34, [6] (Reeves J).
[18]MTGI Trust [2016] FCAFC 190, [10] (Siopis, Collier and Katzmann JJ); Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [No 2] (2015) 230 FCR 337, 342–3 [14]–[15] (Logan, Bromberg and Katzmann JJ).
[19]Rangi v Kmart Australia Ltd [No 2] [2019] FCA 2083, [3] (Steward J); Baker (2014) 145 ALD 548, 550 [10] (Dowsett, Tracey and Katzmann JJ).
The following principles apply in the case of s 570(2)(b):
(f) Paragraph (b) is enlivened when two criteria are satisfied:[20]
[20]Altintas v O’Dea Lawyers [No 2] [2018] FCAFC 187, [6], [13]–[14] (White, Perry and Charlesworth JJ); [2014] FCAFC 166.
(i) one party has engaged in an ‘unreasonable act or omission’; and
(ii) that unreasonable act or omission has caused the other party to incur costs.
(g) Unreasonableness is to be determined objectively. It is a question of impression and degree, to be assessed by reference to the particular circumstances of a given case.[21]
(h) Unreasonableness is not to be confused with negligence or inefficiency.[22] A failure to conduct litigation in the most efficient way does not, without more, enliven the paragraph.[23] The fact that a party has conducted litigation inefficiently, made belated concessions, or adopted a misguided approach may be relevant to, but will not be conclusive of, the question of unreasonableness.[24]
[21]PIA Mortgage Services Pty Ltd v King [No 2] [2020] FCAFC 53, [15] (Rangiah, Charlesworth and Snaden JJ).
[22]Fair Work Ombudsman v Grouped Property Services [No 3] [2017] FCA 810, [26] (Katzmann J).
[23]Clarke (2008) 170 FCR 574, 582 [29] (Tamberlin, Gyles and Gilmour JJ).
[24]Mutch v ISG Management Pty Ltd [No 2] [2020] FCA 954, [8] (Bromberg J).
Costs in the Trial Division
The issue before the Court in respect of costs in the Trial Division is whether the appellant has established that the respondents have engaged in any unreasonable conduct so as to enliven the power to award costs and, if so, whether the Court should order the respondents to pay any costs of the appellant caused by such conduct. As mentioned earlier, we do not find it necessary to enter into the question of what costs of the appellant might be encompassed by such an order, because we are firmly of the view that the appellant has failed to establish the requisite unreasonable conduct.
We can state our reasons shortly, starting with the six matters relied on by the appellant.
(i) The first argument attributed blame to the respondents in ‘triggering’ the litigation commenced by the appellant. We assume, without deciding, that conduct of that kind might fall within the scope of s 570(2)(b) of the FWA, even though it takes place before the proceeding is commenced. But we do not accept that the litigation was caused by the refusal of the SRO to provide the appellant with the unredacted Harassment Report. While this was one of the original issues raised in the litigation, it was ultimately merely one of numerous issues between the parties, including the Customer Search Investigation and the consequences of the decision to terminate the appellant’s employment on the basis of that investigation. The appellant has therefore not established a causal link between the refusal to provide the unredacted report and his costs of the litigation. In any event, while we have found that the SRO erred in its approach to the unredacted Harassment Report, the issue was one that involved multiple and complex legal issues. We would not characterise the action of the respondents in declining to produce the unredacted report as unreasonable within the meaning of s 570(2)(b) of the FWA.
(j) Secondly, while we rejected the argument of the SRO that the VPSEA was ‘simply a background matter’, that argument was not untenable in any respect. The matter of jurisdiction raised novel and difficult questions. We reject the argument that the SRO knew or ought to have known that its case on that issue was bound not to succeed. It was not unreasonable for the respondents to contest the point.
(k) Thirdly, we reject the argument that the respondents acted unreasonably in the relevant sense by refusing to engage in mediation. The issue of mediation was ultimately determined by a judicial registrar who granted a contested application by the SRO to set aside orders that had been made for mediation. To that extent, the inappropriateness of mediation in this case has therefore been judicially confirmed. But in any event, it has not been shown that mediation would have succeeded, and the history of the matter suggests the contrary. In those circumstances, even if the respondents did unreasonably refuse to mediate, the appellant has failed to establish that this caused him to incur any costs.
(l) Next, and relatedly, we do not accept that the SRO acted unreasonably in failing to accept the appellant’s various ‘settlement offers’. Each of the offers may be shortly addressed:
(i) The appellant asserts that by the first offer, dated 28 June 2017, he offered to resign his employment to avoid any protracted dispute. In fact, the appellant stated in the relevant letter, which concerned proceedings in the Fair Work Commission about progression pay and reclassification, that he was ‘open to suggestions’ and that if the SRO was concluded in its view that it wanted the appellant to ‘go away’, he would ‘be pragmatic and pay attention to any serious offer’. This is patently not an offer to settle the litigation in the Trial Division, or indeed any litigation.
(ii) Secondly, on 19 December 2019, the appellant offered to withdraw the Injunction Costs Leave Application and abandon all claims against the SRO, so that the proceedings in the Trial Division and the Fair Work Commission would be dismissed with no orders as to costs in return for payment to the appellant of the sum of $40,000. In truth, the appellant’s ‘offer’ was a request that the respondents surrender their success to that point, abandon their pending claim for damages (which has since been shown to be well-founded) and then pay a further significant sum to the appellant. It was plainly not unreasonable for the respondents to decline this opportunity.
(iii) A third offer of settlement, made by the appellant on 31 March 2020, came after judgment in the damages claim and therefore really concerned proceedings in this Court but it is convenient to mention it now. By that offer, the appellant would have withdrawn the Injunction Costs Leave Application and the respondents would have agreed not to enforce any costs orders in the Trial Division and to pay the appellant’s appeal costs in the sum of $20,000. This was, in effect, a demand that the respondents capitulate in the Injunction Costs Leave Application. We do not accept that, although the appellant was ultimately successful in that application, it was unreasonable for the respondents to have contested it. As we have said, the issues were novel and difficult. It was not unreasonable for the respondents to have declined to capitulate.
(m) Fifthly, the appellant contended that the costs of the SRO were neither reasonable nor proportionate. Whether or not that is so would be a matter for taxation. It would not, in any event, be a matter that caused the appellant to incur his claimed costs.
(n) Sixthly, the appellant submitted that the SRO had repeatedly breached the model litigant guidelines. To the extent that the appellant relies on generalised descriptions of actions of the SRO unrelated to the present litigation, those matters are irrelevant to the question of costs now before us. To the extent that the appellant relies on the attitude of the respondents to the question of settlement or the level of their expenditure on legal costs, we have addressed those matters already and nothing is altered by repeating the same points under the rubric of model litigant principles.
The appellant’s argument as to which party ‘won’ the case and the interests of justice more generally, including his submissions about the ‘power differential’ between himself and the SRO are irrelevant, once it is concluded, as we have above, that the costs discretion in s 570 of the FWA is not enlivened in respect of the costs of the proceeding in the Trial Division.
Conclusion as to Trial Division costs
We will therefore order, in the Injunction Costs Leave Application and the Injunction Leave Application, that there be no order as to the costs of the proceeding in the Trial Division. We will make the same order, subject only to the extant order relating to the notice to produce, in the Damages Leave Application.
Costs of the appeals
It follows from what is said above that we also reject the appellant’s claims regarding the costs of the various appeals. We turn therefore to the four discrete matters in respect of which the respondents seek costs in this Court.
Further evidence application
First, the respondents submitted that the bringing of the further evidence application was unreasonable in the relevant sense. We agree. Our reasons for refusing that application demonstrate that the documents sought were simply irrelevant to the issues to be resolved in this Court.[25] We do not think that the contrary was reasonably arguable. Rather, the application appeared to represent a concerted attempt by the appellant to widen the scope of the disputes between the parties. In that regard, we accept the respondents’ submission that there was overlap with the documents the subject of the notice to produce which was set aside by the associate judge for much the same reason. It is also true, as the respondents submitted, that the application was accompanied by submissions alleging deliberate concealment of evidence, made without a proper evidentiary basis and, again, irrelevant to the appeals. It is appropriate that the respondents have their costs of responding to the application in these circumstances. We are not, however, satisfied that those costs should be taxed on the indemnity basis.
[25]Principal Reasons [168].
There will be an order that the appellant pay the respondents’ costs of the further evidence application, to be taxed on the standard basis.
Damages Leave Application grounds 1 and 2
Secondly, the respondents contended that it had been unreasonable for the appellant to rely on grounds 1 and 2 in the Damages Leave Application. The Court found both of these grounds to be ‘entirely without merit’.[26] Had they constituted the only grounds for the Damages Leave Application, we would have held that application to have been instituted ‘without reasonable cause’ within the meaning of s 570(2)(a) of the FWA, because it would have been a proceeding instituted with no reasonable prospects of success. Equally, the inclusion and prosecution of those grounds in the proceeding that was in fact instituted was an unreasonable act that caused the respondents to incur costs. In forming that view, we particularly take into account the fact that the ‘clean hands’ argument quite speciously relied on alleged conduct of the SRO that had nothing to do with the appellant or this litigation. It was equally untenable to seek to rely on the level of the SRO’s legal costs as going to the question of ‘clean hands’. In addition, the ‘mitigation’ argument was a barely disguised attempt to extract the appellant from the inevitable consequences of his undertaking by assaulting the foundations upon which it depended.
[26]Ibid [434].
However, although the costs discretion is enlivened, we would not make an order in respect of these costs. The Damages Leave Application itself succeeded in so far as it concerned the associate judge’s order for costs. In an ordinary costs jurisdiction, the appellant would have been entitled to the costs of at least that part of the application. His failure on grounds 1 and 2 would properly have warranted a discount in the costs awarded to him, but he would still have had a costs order in his favour. We do not think it would be just, in the ‘no costs’ environment of s 570, to visit the appellant with an adverse costs order in circumstances where that environment has already operated in favour of the respondents by relieving them of the prospect of paying the appellant’s costs. The fairer outcome is to make no order.
Stay application
The third matter concerns the application for a stay of the appeal proceedings pending the determination of the Federal Court defamation proceeding. We accept the respondents’ submission that it was relevantly unreasonable for the appellant, having commenced the defamation proceeding, to seek to stay the proceedings in this Court. There was no conceivable basis upon which it would have been appropriate to grant the stay. The issues in the two courts were entirely different. The appellant could point to no prejudice he would suffer if a stay were not granted. The proceedings in this Court were well-advanced, over a period of years, whereas the defamation proceeding was relatively newly commenced. The application for a stay was unnecessary and unreasonable and caused the respondents to incur the costs of defending it. It is appropriate in those circumstances that the appellant pay those costs, on the standard basis.
CPA application
Finally, the respondents relied on the application made by the appellant under ss 26 and 65A of the CPA. Section 26 provides for the overarching obligation to disclose documents critical to the resolution of the dispute; s 65A provides for an order directing a party to provide a memorandum of its estimated costs and disbursements in relation to a trial.
The application formed part of the stay application. It sought, under s 26, copies of invoices of the respondents’ costs and disbursements pertaining to the costs orders made by the associate judge in respect of the injunction application; and, under s 65A, a memorandum in respect of the length of the proceedings in this Court and the respondents’ costs and disbursements. It was said that these documents were ‘critical’ to the resolution of the dispute between the parties and the efficient use of judicial and administrative resources. The application again rehearsed the appellant’s complaints about the level of expenditure of the respondents on legal costs and their failure to agree to a resolution of the proceedings. This Court held that such orders would not provide any assistance to the appellant or to the Court in relation to the issues in the appeal proceedings’.[27] It is fanciful to suppose that orders of the kind sought would have made any difference to the prospects of resolving the various proceedings by consent.
[27]Ibid [116].
In our view, it was unreasonable in the relevant sense for the appellant to make this application. As with the stay application of which it formed part, an order should be made that the appellant pay the respondents’ costs of the application, to be taxed on the standard basis.
Conclusion as to Court of Appeal costs
It will be ordered in each appeal that the appellant pay the respondents’ costs, to be taxed in default of agreement on the standard basis, of:
(o) the appellant’s application for a stay and orders under ss 26 and 65A of the CPA, dated 1 June 2020; and
(p) the appellant’s application to adduce further evidence, forming part of the application other than for leave to appeal or cross-appeal dated 28 April 2020.
There will otherwise be no order as to the costs of the applications for leave to appeal, or the appeals.
- - -
21
8
0