WHITE v CFMEU and Anor (No.2) - [2010] FMCA 927

FEDERAL MAGISTRATES COURT OF AUSTRALIA

WHITE v CFMEU & ANOR (No.2)

[2010] FMCA 927

INDUSTRIAL LAW – Costs ruling.

Cahill v Construction, Forestry, Mining and Energy Union (No.4) (2009) 189 IR 304
Australian Building & Construction Commissioner v Construction, Forestry, Mining and Energy Union (No.2) [2010] FCA 977

Applicant:

MICHELLE WHITE

First Respondent:

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

Second Respondent:

ADRIAN MCLOUGHLIN

File Number:

MLG 862 of 2009

Judgment of:

Burchardt FM

Hearing date:

11 November 2010

Date of Last Submission:

27 October 2010

Delivered at:

Melbourne

Delivered on:

11 November 2010

REPRESENTATION

Counsel for the Applicant:

Mr J. Snaden

Solicitors for the Applicant:

Clayton Utz

Counsel for the Respondents:

Mr Sayers

Solicitors for the Respondents:

Emma Walters

ORDERS

The Respondents pay 80% of the Applicant’s costs to be taxed in default of agreement pursuant to the Federal Magistrates Court Rules.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT MELBOURNE

MLG 862 of 2009

MICHELLE WHITE

Applicant

And

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

First Respondent

ADRIAN MCLOUGHLIN

Second Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

On 21 September 2010, I gave judgment in this matter and the applicant indicated a desire to seek costs. I made a timetable for written submissions and the respondent’s last reply was filed on

27 October 2010. I was on leave until 3 November. I decided to give judgment orally today, which is not my normal practice, but the process of reducing any reasons to writing and the bureaucratic associated processes would mean you would not get judgment till after Christmas and that is far too long for a relatively minor matter of this sort.
So far as the law governing these circumstances is concerned, I refer with respect generally to the judgment of Kenny J in Cahill v Construction, Forestry, Mining and Energy Union (No.4) (2009) 189 IR 304 at pages 326 to 329. I respectfully adopt and incorporate her Honour’s reasoning as part of my own. In particular, however, I refer to paragraphs [113] to [114] of her Honour’s judgment, which I will read out:
“[113] The usual practice is that costs follow the event, with the result that the court will order the recovery of costs by a successful party on a party and party basis. The matter of costs is, however, in the general discretion of the court, although the discretion must be exercised judicially, that is, in a principled way by reference to the litigation: see Ruddock v Vadarlis (No.2) (2001) 115 FCR 229 at 234 at [9]-[10].
[114] In some circumstances, the usual rule will be found wanting and success on a portion only of a claim may make it reasonable for the litigant to bear the expense of the portion in which the litigant failed. Sometimes too, an otherwise successful litigant may be ordered to pay the costs of the other party in respect of the issues on which that litigant failed. As Black CJ and French J said in Ruddock v Vadarlis (No 2) 115 FCR 229 at 236 at [15]:
“Usually the circumstances in which a successful party is denied all or part of its costs have to do with his conduct of the proceedings.”
And their Honours went on to note a number of particular instances where that might be the case.
I was also referred to the Australian Building & Construction Commissioner v Construction, Forestry, Mining and Energy Union

(No.2)
[2010] FCA 977, a decision of Barker J given on 3 September 2010. I would wish to read out paragraph [135] where Barker J said:
“The texts and legal practice services that deal with the subject of costs in legal proceedings are replete with practical examples of deviations from the ordinary rule as well as other rules of thumb to deal with particular circumstances that arise not uncommonly. In the end, they all go to establish the point that a costs order should fairly reflect the outcome of the case and what was involved in its prosecution.”
If I may respectfully say so that sounds an admirable statement of principle to govern these kinds of circumstances.
Turning next to the question of the parties’ arguments, these are all set out in the parties’ written submissions and it is not necessary to deal with every point made seriatim. There are a number of matters I regard as significant and the first is the statement of agreed facts.
Proceedings actually started on 13 July 2009 and there were four interlocutory directions hearings, although it should be said that not all of those were caused by the respondents. Substantial materials were filed by the applicant up to May 2010. As the parties have informed me, negotiations for the production of a statement of agreed facts only started in about mid-June 2010 and the statement of agreed facts was not produced in final form until 8 July 2010. The trial started on

14 July.
Clearly, the statement of agreed facts saves time for the Court and saves both parties money. The statement of agreed facts is furthermore one of the matters relevant to the quantum of penalty. I should note that although I did not, I think, refer to it specifically in the judgment, this was an oversight. It was a matter taken into consideration. It is not appropriate to make general rulings about the effect of statements of agreed facts on costs and by way of example here I refer to the applicant’s assertions about double dipping. Each case necessarily turns on its own facts. Here, I would only say that the statement of agreed facts only got under way very late in the day after the applicant had effectively taken all interlocutory steps to prepare for trial.
Another issue I regard as significant is the degree of success of the parties and in this regard I turn to the question of the extent of the financial loss occasioned by the offending conduct. The respondents make much of the original Brady estimate of loss of $76,000. It is clear that that was wildly exaggerated. Nonetheless, in my view the submissions of the parties both somewhat overstate the position. The respondents were not wholly successful on the issue of quantum. Although I was not able to quantify the loss exactly it was undoubtedly greater than the $6,334 contended for by the respondents. Having said that, loss was less than that contended for by the applicant. For example, I refer here to the assertions as to the loss of $15,000 by way of penalty for a day’s delay.
Furthermore, the reality is that in any event even a loss of $76,000, had it occurred, would have been relatively small in the scheme of such a large site and it should further be noted that loss, however, is only one of the numerous matters that are taken into consideration in assessing penalty.
Another issue in which one looks to the success of the parties is as to the quantum of penalty. The respondents are correct in my view to submit that the Court’s final resolution was roughly half way between the positions contended for by the parities.
I note the following points:
a)First, I do not accept the respondent’s submission made at paragraph 20 of the submissions filed on 5 October 2010, that the Court should not order costs where statement of agreed facts are produced as a general rule. The existence of a statement of agreed facts may, but not necessary will, be a relevant consideration. But it is certainly not appropriate to elevate it to what Barker J described as a rule of thumb.
b)Second, I have had no regard whatever to the matters asserted to have fallen between counsel and legal representatives during negotiations. That is an area fraught with peril.
c)Next, I do not accept the respondent’s submission that there should be no costs where penalty is the only issue as asserted in paragraph 26 of the submissions filed on 5 October 2010. Once again, each case turns on its own facts.
d)Finally, I do not accept that Mr Milton’s evidence was unnecessary. The extent of the disruption and loss caused by the offending conduct was clearly relevant to penalty. The time spent on Mr Milton was not significantly expanded in my view by the issues arising from the exaggerated loss asserted by Brady originally.
In my view, bearing in mind all of these matters, particularly the relative lack of success of the applicant on the question of quantum, I will order that the respondents pay 80 per cent of the applicant’s costs to be taxed in default of agreement pursuant to this Court’s rules.

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Burchardt FM

Date: 11 November 2010