Virag v Eastern Victoria GP Training Ltd

Case [2024] FCA 1283

FEDERAL COURT OF AUSTRALIA

Virag v Eastern Victoria GP Training Ltd [2024] FCA 1283

Appeal from: Virag v Eastern Victoria GP Training Ltd [2023] FedCFamC2G 788
File number(s): VID 796 of 2023
Judgment of: ANDERSON J
Date of judgment: 7 November 2024
Catchwords: COSTS – appeal of indemnity costs orders made under s 570 of the Fair Work Act 2009 (Cth) – where the final hearing held over 3 days and adjourned part heard – where appellant sought further 12 month adjournment of part heard hearing and subsequently discontinued application – where primary judge found that appellant instituted the proceedings vexatiously and without reasonable cause in light of legal advices received by the appellant – where the primary judge found that appellant’s unreasonable actions in rejecting six offers to resolve the matter caused the respondent to incur costs – no error found in primary judge’s decision – appeal dismissed
Legislation: Fair Work Act 2009 (Cth)
Cases cited:

Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 3) [2017] FCA 810

House v The King (1936) 55 CLR 499

Melbourne Stadiums Ltd v Sautner (2015) 317 ALR 665; FCAFC 20

Rambaldi (Trustee) v Meletsis, in the matter of the bankrupt estate of Karas (No 3) [2022] FCA 807

Saxena v PPF Asset Management Ltd [2011] FCA 395

Vines v Australian Securities and Investments Commission (2007) 63 ACSR 505; NSWCA 126
Division: Fair Work Division
Registry: Victoria
National Practice Area: Employment and Industrial Relations
Number of paragraphs: 58
Date of hearing: 8 October 2024
Counsel for the Appellant: The Appellant appeared in person
Counsel for the Respondent: Mr M Minucci
Solicitor for the Respondent: Hall & Wilcox

ORDERS

VID 796 of 2023
BETWEEN:

JUDITH VIRAG

Appellant
AND:

EASTERN VICTORIA GP TRAINING LTD

Respondent

ORDER MADE BY:

ANDERSON J

DATE OF ORDER:

6 NOVEMBER 2024

THE COURT ORDERS THAT:

1.The appeal be dismissed.

2.The appellant pay the respondent’s costs of and incidental to the appeal, such costs to be agreed or, in default of agreement, to be fixed by a Registrar of the Court.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

ANDERSON J:

INTRODUCTION

  1. Dr Judith Virag (appellant) was employed by the respondent (EVGPT) as a part-time medical educator on a fixed term contract that expired on 31 December 2018.

  2. On 27 February 2019, the appellant filed a general protections application alleging breaches of the Fair Work Act 2009 (Cth) (FW Act) against EVGPT (application).

  3. The application was listed for hearing before the primary judge on 24-26 May 2021.  However, on the third day of the hearing (during which the appellant was self-represented), the appellant requested an adjournment.  The matter was adjourned part-heard to 25 October 2021.  The appellant subsequently requested a further adjournment, with the matter then being listed for hearing on 8 April 2022.  However, following a further case management hearing on 4 February 2022, the appellant…

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Virag v Eastern Victoria GP Training Ltd [2024] FCA 1283
Case
[2024] FCA 1283
Decision Date

CaseChat Overview and Summary

In Virag v Eastern Victoria GP Training Ltd, the appellant, Dr Virag, appeals against the entire costs judgment made by the primary judge, asserting that the order for indemnity costs was erroneous. The primary judge had determined that Dr Virag instituted the proceedings vexatiously and without reasonable cause, and that her conduct caused the respondent to incur costs. Dr Virag’s appeal hinges on several grounds, primarily challenging the primary judge's assessment of her actions and decisions throughout the litigation process.

The legal issues before the court revolved around whether the primary judge correctly found that Dr Virag instituted the proceedings without reasonable cause, whether her refusal to accept settlement offers constituted unreasonable conduct, and whether she disregarded legal advice in a manner that warranted an adverse costs order. Dr Virag argued that the primary judge erred by not considering the potential for a more significant remedy than the settlement offers and that she was not adequately informed of the risks associated with continuing the litigation. The court had to examine the merits of these arguments and determine if the primary judge's findings were supported by the evidence and appropriate under the Fair Work Act 2009.

The court found no merit in Dr Virag's arguments. It held that the primary judge’s assessment of the case was sound and that Dr Virag’s actions throughout the proceedings were unreasonable. The court noted that Dr Virag had received multiple legal opinions indicating the risks of an adverse costs order, which she chose to ignore. Furthermore, the court found that the primary judge correctly considered the rejected settlement offers and the additional work caused by Dr Virag's amendments to her statements of claim. The court concluded that the primary judge's decision was justified and that there was no basis to interfere with the costs order.

The appeal was dismissed, and Dr Virag was ordered to pay the respondent's costs of the appeal. The court emphasised the importance of adhering to legal advice and the consequences of vexatious litigation under the Fair Work Act. This decision underscores the court's role in ensuring that legal proceedings are conducted in a manner that is reasonable and not an abuse of the judicial process.

Orders

Orders of the court

1. The appeal be dismissed.

2. The appellant pay the respondent’s costs of and incidental to the appeal, such costs to be agreed or, in default of agreement, to be fixed by a Registrar of the Court.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The appellant appeals from the entirety of the costs judgment. The appellant’s appeal relies upon five grounds of appeal which are summarised below:(1)The primary judge erred in finding that the appellant instituted the proceedings vexatiously or without reasonable cause;(2)The primary judge erred in finding that the appellant’s continuation of the proceedings was an unreasonable act or omission. Alternatively, the primary judge erred by failing to consider that:(a)had the appellant’s claims succeeded, the appellant would have likely received a monetary remedy above the highest offer made to her by EVGPT ($20,000) and the Court would likely have imposed civil penalties entailing the public denunciation of EVGPT’s conduct; and(b)EVGPT’s offers to settle for $20,000 were each made before the appellant had received EVGPT’s written submissions filed on 8 February 2021 and which set out the basis of EVGPT's case;(3)The primary judge erred in finding that the appellant wilfully disregarded the legal advice provided to her, or alternatively, the primary judge erred in finding that this constituted an unreasonable act or that the appellant’s continuation of the proceeding in light of the legal advice she received was “highly unreasonable”. The appellant also claims that this was not a matter raised by EVGPT, and therefore, the appellant was not provided a fair hearing due to the primary judge making an adverse finding on the matter without it being raised with the appellant;(4)The primary judge erred in finding that the appellant expanded her case “throughout the proceedings” by her amended statements of claim and outlines, and this caused “considerable work” to be undertaken by EVGPT. Alternatively, it is argued that given the appellant was self-represented, the primary judge erred in concluding it might also be an unreasonable act for the purposes of s 570 of the FW Act. The appellant also raises the same procedural fairness issue in respect of this finding as raised in relation to ground three above;(5)The primary judge erred in finding that it was appropriate to order that the appellant pay the respondent’s costs at all, or, in the alternative, on an indemnity basis rather than on a party/party basis. BACKGROUND The background to this matter, alongside the evidence and submissions made before the primary judge in relation to costs, are set out in detail in [7]-[55] of the costs judgment. These matters will not be restated in these reasons. It suffices to summarise the key points as follows:(a)at various points prior to and during the application, the appellant received legal advice which noted the risk of an adverse costs order being made against her. The most relevant of these advices include:(i)a letter from Kennedys dated 25 February 2019. The letter from Kennedys relevantly stated:We consider that there are sufficient objective facts to make the claim, but it is entirely possible, depending on the evidence, that EVGPT will be able to defend the case, with the result that you will be unsuccessful…You have instructed us that your ideal outcome would be that you are re-employed by EVGPT… We have advised you that in our opinion it is most unlikely that the Court would order your re-employment…[I]n our opinion if you were to succeed in satisfying that Court that the reasons for which your contract was not renewed included a prohibited reason, the Court would not make a monetary compensation for economic loss as it appears that you have not suffered any…The Court has a discretion to impose monetary penalties for breach of civil penalty provisions. We do not believe that it is likely that any penalty imposed if you were successful in this matter would be for a significant sum… It is of concern to us that having regard to the above factors, it seems clear that apart from the possible imposition of penalties and a possible small amount of compensation for distress, there is no additional remedy such as a large amount of money… You have instructed us that you will not agree to a monetary settlement, because you are not interested in the money… If there is no settlement, then the case will proceed to verdict. It is unlikely that you will be able to withdraw your case without paying the costs of the other side.(ii)an email from Mr Rod Felmingham on 27 February 2019, Senior Associate at Kennedys;(iii)advice from Ms Tueno of counsel on 18 March 2019, which relevantly concluded:Accordingly, at present based on the material to hand, I consider this to be a case that will be difficult for Dr Virag to win. It would be in Dr Virag’s best interest to reach a settlement and not proceed to trial in this matter.(iv)advice from Mark Champion of counsel (as his Honour then was) on 4 November 2019 which stated:[O]n the material to hand I regard Dr Virag’s case as unlikely to be successful. Without wishing to be pejorative, I regard her case as weak… She should consider whether to bring the action to an end probably on a walkaway basis to protect herself against a costs order notwithstanding s. 570 and to safeguard her reputation.(b)between 16 November 2019 and 17 February 2022, EVGPT made six offers of settlement to the appellant, all of which the appellant rejected. The appellant variously stated that she rejected the offers on the basis that the offers “were of no interest”, and that she was “not motivated by potential financial gain”.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

On 31 August 2023, the primary judge determined that the appellant instituted the proceedings vexatiously and without reasonable cause, and that her unreasonable acts caused the respondent to incur costs. The primary judge ordered that the respondent’s costs be paid on an indemnity basis (the costs judgment). The appellant appeals from the entirety of the costs judgment. The appellant’s appeal relies upon five grounds of appeal which are summarised below:(1)The primary judge erred in finding that the appellant instituted the proceedings vexatiously or without reasonable cause;(2)The primary judge erred in finding that the appellant’s continuation of the proceedings was an unreasonable act or omission. Alternatively, the primary judge erred by failing to consider that:(a)had the appellant’s claims succeeded, the appellant would have likely received a monetary remedy above the highest offer made to her by EVGPT ($20,000) and the Court would likely have imposed civil penalties entailing the public denunciation of EVGPT’s conduct; and(b)EVGPT’s offers to settle for $20,000 were each made before the appellant had received EVGPT’s written submissions filed on 8 February 2021 and which set out the basis of EVGPT's case;(3)The primary judge erred in finding that the appellant wilfully disregarded the legal advice provided to her, or alternatively, the primary judge erred in finding that this constituted an unreasonable act or that the appellant’s continuation of the proceeding in light of the legal advice she received was “highly unreasonable”. The appellant also claims that this was not a matter raised by EVGPT, and therefore, the appellant was not provided a fair hearing due to the primary judge making an adverse finding on the matter without it being raised with the appellant;(4)The primary judge erred in finding that the appellant expanded her case “throughout the proceedings” by her amended statements of claim and outlines, and this caused “considerable work” to be undertaken by EVGPT. Alternatively, it is argued that given the appellant was self-represented, the primary judge erred in concluding it might also be an unreasonable act for the purposes of s 570 of the FW Act. The appellant also raises the same procedural fairness issue in respect of this finding as raised in relation to ground three above;(5)The primary judge erred in finding that it was appropriate to order that the appellant pay the respondent’s costs at all, or, in the alternative, on an indemnity basis rather than on a party/party basis. BACKGROUND The background to this matter, alongside the evidence and submissions made before the primary judge in relation to costs, are set out in detail in [7]-[55] of the costs judgment. These matters will not be restated in these reasons. It suffices to summarise the key points as follows:(a)at various points prior to and during the application, the appellant received legal advice which noted the risk of an adverse costs order being made against her. The most relevant of these advices include:(i)a letter from Kennedys dated 25 February 2019. The letter from Kennedys relevantly stated:We consider that there are sufficient objective facts to make the claim, but it is entirely possible, depending on the evidence, that EVGPT will be able to defend the case, with the result that you will be unsuccessful…You have instructed us that your ideal outcome would be that you are re-employed by EVGPT… We have advised you that in our opinion it is most unlikely that the Court would order your re-employment…[I]n our opinion if you were to succeed in satisfying that Court that the reasons for which your contract was not renewed included a prohibited reason, the Court would not make a monetary compensation for economic loss as it appears that you have not suffered any…The Court has a discretion to impose monetary penalties for breach of civil penalty provisions. We do not believe that it is likely that any penalty imposed if you were successful in this matter would be for a significant sum… It is of concern to us that having regard to the above factors, it seems clear that apart from the possible imposition of penalties and a possible small amount of compensation for distress, there is no additional remedy such as a large amount of money… You have instructed us that you will not agree to a monetary settlement, because you are not interested in the money… If there is no settlement, then the case will proceed to verdict. It is unlikely that you will be able to withdraw your case without paying the costs of the other side.(ii)an email from Mr Rod Felmingham on 27 February 2019, Senior Associate at Kennedys;(iii)advice from Ms Tueno of counsel on 18 March 2019, which relevantly concluded:Accordingly, at present based on the material to hand, I consider this to be a case that will be difficult for Dr Virag to win. It would be in Dr Virag’s best interest to reach a settlement and not proceed to trial in this matter.(iv)advice from Mark Champion of counsel (as his Honour then was) on 4 November 2019 which stated:[O]n the material to hand I regard Dr Virag’s case as unlikely to be successful. Without wishing to be pejorative, I regard her case as weak… She should consider whether to bring the action to an end probably on a walkaway basis to protect herself against a costs order notwithstanding s. 570 and to safeguard her reputation.(b)between 16 November 2019 and 17 February 2022, EVGPT made six offers of settlement to the appellant, all of which the appellant rejected. The appellant variously stated that she rejected the offers on the basis that the offers “were of no interest”, and that she was “not motivated by potential financial gain”.

Ratio Decidendi

Legal Principle Established

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