Union of Australian College Academics v Australian Film, Television and Radio School

[1992] FCA 666

JUDGMENT Na ...&&.../q~

OF AUSTRALIA )

1

m T O R I A N DISTRICT	REGISTW	1	V1 NO. 80 of 1991
\

B E T W E E N :

ONION OF AUSTRALIAN	C O W G E
AcADl3HICS

Applicant

- and -

AUSTRALIAN FILM TELEVISION

AND RADIO SCHOOL

Respondent

JUDGE MAKING ORDER:	Keely J
PLACE ORDER MADE:	Melbourne
DATE ORDER MADE:	21 August 1992

MINUTES OF ORDEq

Note:	Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

THE COURT ORDERS THAT:

The application by the respondent for costs be dismissed.

m e r a l dis-ution not rewired

XN THE P E D E R A L J U L	OF
)

DISTRICT REGISTRX	)	V1 NO. 80 of 1991
)

-	)
B E T W E E N :
UNION OF AUSTRALIAN COLIXGE ACADEMICS

Applicant

- and -

AUSTRALIAN FILH TELEVISION

AND RADIO SCHOOL

Respondent

REASONS FOR JUDGMENT

21 AUGUST 1992	KEELY J
By an application filed 22 November 1991, the Union of Australian College Academics ("the applicant") claimed the imposition on the Australian Film, Television and Radio School ("the respondent") of penalties pursuant to s.178 of the	Industrial Relations Act 1988 ("the Act") for breaches of the
Australian Post Compulsory and Higher Education Academic Staff
(Conditions of Employment) Award 1988 ("the award").
At a directions hearing on 17 February 1992 the matter was fixed for hearing on 18 March 1992, counsel estimating that the matter would take 2 days for hearing. On 18 March 1992 counsel for the applicant sought leave to discontinue the proceeding. Counsel for the respondent applied for costs
pursuant to 8.347 of the Act. That section reads relevantly
as follows:

s.347(1) A party to a proceeding ... in a matter arising under this Act shall not be ordered to pay costa incurred by any other party to the proceeding unless the first-mentioned party instituted the

proceeding vexatiously or w~thout reasonable cause. ...

Various authorities have dealt with the meaning of that section and enunciated certain principles. In Thom~son v Bodder (1989) 21 FCR 467 at 470-471 a Full Court of this Court

said: -

"In Heidt v C h r y s l e r Aus t ra l i a Ltd (1976) 26 FLR 257 at

272, Northrop J said:

"The policy of a197A of the Act is clear. It is designed to

free parties from the risk of hav~ng to pay the costs of an opposing party. At the same time the section provides a protection to parties defending proceedings which have been instituted vexatiously or without reasonable cause. This protection is in the form of conferring a power in the court to order coats against a party who, in substance, institutes proceedings which in other jurisdictions may constitute an abuse of the process of a court."

It is apparent from these authorities that an applicant who has the benefit of the protection of S 347 will only rarely be ordered to pay the costs of a proceeding in exceptional circumstances. ...

Counsel for the respondents called in aid passages from

the judgment of the Court in Standish v U n i v e r s i t y of	Tasmania (1989) 31 ALJR 210 [sic - see instead 28 I.R.
1291. In that case, a proceeding had been instituted seeking an interpretation of an award. ... (471) The Standish case illustrates the care which must be taken in the application of s 347. The mere fact that an applicant fails to make out a case for the relief sought in a proceeding cannot render the proceeding something other than one in a matter arising under the
Act . Careful scrutiny is required to ascertain whether
the claim'made was vexatious or without reasonable cause at its inception, before an order for costs can be made."

After almost a full day of oral submissions by counsel for both parties in relation to the application for costs, the

court granted an application by the applicant for an adjournment to enable it to file and serve further affidavit material in relation to the issues raised by the respondent employer's application for costs. The court suggested that the parties might wish to file written submissions in this matter in order to avoid the cost of a further oral hearing. In the result the applicant union filed affidavits and a written submission and the respondent employer filed a written submiss ion. The written submisaions of both parties substantially restated and to some extent supplemented the oral submissions made by counsel for both parties before the Court on 18 March 1992.

The respondent's written submission included the following:-

"(a) This written submission is intended to supplement the oral submissions made for the Respondent on Monday, 18 March 1992, taking into account the matters contarned in the Affidavits of Sue Howard-Smith and Grahame McCulloch, both dated 1 April 1992, filed in these proceedings by the Applicant subsequent to the proceedings on 18 March.

(b)	This wr~tten submission also takes into account the
Applicant's written submissions served upon the

Respondent on 15 May 1992. Since the matter was argued fully before the Court on 18 March 1992, only a very brief reply is directed specifically to the Applicant's

written submissioner see paragraph 9 below.

2.     In summary, the Respondent has submitted in support of its application to have an order for costs (on the ground that the proceedings were commenced vexatiously or without reasonable cause) as follows:"

The respondent then set out four submissions (a) (b) (c) and (d). It is convenient to quote each submission and then deal with it.

"that the Award in question was an award made by consent, that the Respondent was not a consenting party, and that by virtue

of the clear words in section 28 of the Conciliation and Arbitration Act 1904 and now section 112 of the Industrial Relations Act 1988, the Respondent could not ever have been bound by the Award. This is not a submission which attacks the jurisdiction of the Commission to make an award in aettlen%nt of the dispute, but rather one which draws attention to the statutory limits upon the binding effect of a consent Award (as distinct from an award made by arbitration) made by the Commiseion at the request of certain partiee who did not include in their number the Respondent;"

I have studied the affidavit material and the submissions, written and oral, of both parties on this question. The material falls considerably short of satisfying me that "the Respondent could not ever have been a party bound by the Award" (as the respondent contends). Section 149(b) of the Act provides that "an award determining an industrial dispute is binding on: . . . all parties to the industrial dispute who were summoned or notified ... to appear as parties to the industrial dispute (whether or not they appeared)" (see also s149(c)).

There may also be force in the matters referred to in paragraph 10 of the applicant's written submission as to the

conduct of the respondent, the evidence of its participation	in proceedings before the Industrial Relations Commission and
its failure to suggest that it was not bound by the award.
In that connection reference may also be made to paragraph 10 of Mr McCulloch's affidavit, quoting the following passage from page 79 of the transcript of the hearing in the Australian Industrial Relations Commission on 24 January 1991. That transcript quoted the representative of the respondent as
sayings -

"UACA had previously suggested to the school that it would be taking action in the Federal Court. That matter was referred to the school's council in full session and as a basis of the discussion at that council and on the basie of a commitment by UACA to defer proceedings in the alleged breach of award, discussions were arranged and a process set in hand to try and resolve the contract of employment issue.

Now, I only say this for UACA's benefit, that if it intends

resurrecting the breach of award proceedings or the alleged breach of award proceedings then it puts at risk the ongoing discussions as to resolution of the contract of employment issue. "

The material before the court does not enable it to uphold the respondent's submission that it "could not ever have been bound by the award".

Submission l bl

"that the Award clause in question - orrginally clause 11, now
clause 12 - expressly states for its operation a cond~tion
precedent which the Applicant knows, and has always known, has
not been satisfred. This appears from clause ll(a)(iv) of the
Award where there is a requirement for certain meetings to take
place, meetings which on the evidence did not take place, and
from clause ll(b) and (c) which make the operation of the
clause subject to the drscussrons referred to in clause

ll(a)(iv);"

The submission raises a question of law as to the construction of the award. Having heard considerable oral argument on that question, together with written submissions, one thing is	quite clear; the applicant did have an arguable case that the	award provision was in force and imposed an award obligation
upon the respondent which was not subject to a condition precedent. It may be added that, on the evidence, it is not common ground that no meetings took place. This submission fails.

sion lcl

"that there is substantial evidence that these proceedings were commenced by the Applicant in order to impose pressure upon the Respondent to make certain concessions in respect of industrial claims made upon it by the Applicant. The Respondent's view that the

proceedings were so motivated waa very quickly conmnrnicated to the Applicant and has been consistently maintained by it since. The approach of the Applicant'm

officers and agents to which attention has been drawn
supports the accuracy of the Respondent's view."

Having considered this submission and the evidence on which it is based, in my opinion it does not establish that "these proceedings were commenced by the Applicant in order to impose pressure upon the Respondent to make certain concessions in respect of industrial claims made upon it by the Applicant".

It may be added that, in a letter dated 10 December 1991 (Exhibit PCC 10 to the affidavit of P. Carl), the respondent's solicitors, Blake Dawson Waldron, gave notice that, if the applicant's present application were "not discontinued inaediately", then "at an appropriate stage [the respondent] intends raising in the Federal Court the question whether its process has been abused and seeking an order for costs." Order 20 Rule 2 of the Federal Court Rules empowers the court to dismiss a proceeding if it appears that:

(a)

... no reasonable cause of action is disclosed;

or (C) the proceeding is an abuse of the process of

the Court.

The respondent employer joined with the applicant in seeking directions and the fixation of a date for the hearing. It did not make application for an order under Order 20. Submission (c) fails.

"the Respondent is not a 'college' within the meaning of the
Award. "

It is sufficient to say that, on the material before the court, I accept the written submission of the applicant that it is "at the very least, reasonably arguable" [that the respondent is a college within the meaning of the clause].

After stating the above four submissions, the respondent's written submission continued:-

"The unexplained discontinuance of the proceedings by the Applicant leads in all theae circumstances to an irresistible inference that there was no reasonable cause for the commencement of the proceedings which the Applicant can now present."

That submission ignores the applicant's evidence (e.g. Mr. McCulloch's affidavit, especially paragraphs 20-23) as to the matters leading to the discontinuance. It may be added that the respondent's submission also appears to ignore the contents of paragraph 9 of Mr. McCulloch's affidavit as to his approach, as General Secretary of the applicant, to the institution of legal proceedings. On the material before the

court I am not able to infer "that there was no reasonable	cause for the commencement of the proceedings".
For the foregoing reasons the respondent employer has not shown that the application was instituted "vexatiously or without reasonable cause". ~ c c o r d h g l ~ the application by the respondent employer is refused.

I certify that this and the seven (7)

preceding pages are a true copy of the

Reasons for Judgment of Mr Justice Keely.

Associate:

Counsel for the Applicant : Mr. A. Watson

Solicitors for the Applicant : Maurice Blackburn and

CO.

Counsel for the Respondents	:	W. F. parry
Solicitors for the
Respondents	Blake Dawson Waldron
Date of Hearing	:	18 March 1992
Date of Judgment	21 August 1992