Wilson v Phoenix Contracting Services Pty Ltd
[1998] VSC 81
•18 September 1998
SUPREME COURT OF VICTORIA
CAUSES JURISDICTION
Not Restricted
No. 5558 of 1998
ANTHONY ROBERT WILSON
Appellant
v
PHOENIX CONTRACTING SERVICES PTY.LTD. and
BARBARA HAIG
Defendants
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JUDGE: HEDIGAN, J. WHERE HELD: MELBOURNE DATE OF HEARING: 7 September 1998 DATE OF JUDGMENT: 18 September 1998 MEDIA NEUTRAL CITATION: [1998] VSC 81
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COSTS - Appeal against order - Equal Opportunity Tribunal - Section 138 Equal Opportunity Act - Tribunal dismissing complaint of sexual harassment - View of Tribunal complaint completely lacking any foundation - Hearing submissions at conclusion of evidence but before decision - Counsel making decision to address on costs - Whether waiver of right to object.
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APPEARANCES: Counsel Solicitors For the Appellant Mr. P. Ginnane Gadens For the Defendant Mr. S. Stuckey Gilbert & Tobin
HIS HONOUR:
This is an appeal under s.150 of the Equal Opportunity Act 1995 against the order of the Anti-Discrimination Tribunal (hereinafter called "the Tribunal") made on 27th March 1998 whereby the Tribunal ordered that the appellant's complaint be dismissed and that the appellant pay the respondents' costs (including reasonable disbursements) of the hearing, to be assessed by the Registrar in accordance with Scale D of the County Court Scale. The applicable section of the Act (now repealed) permitted an appeal to the Supreme Court on a question of law from an order of the Tribunal, treating the Tribunal's order as if it were a final order of the Magistrates' Court and applying s.109 of the Magistrates' Court Act 1989 to the Tribunal's decision. In effect, the appeal to this Court is concerned only with the order for costs that was made in favour of the respondents, pursuant to s.138 of the Act. The provisions of the Act concerning the Tribunal (formerly the Board) to order costs have been amended over the years. Section 47 of the 1984 Act provided that if the Board, having heard the complaint, considered that it was frivolous, vexatious or totally lacking in substance, or that the respondent has behaved unreasonably, might order the person who made the complaint or the respondent to pay costs as fixed by the Board. In 1993 s.47 was amended to provide that in any inquiry or proceeding before the Board it might order the payment of costs fixed by it and, in making such an order, the Board must, unless there are special circumstances, fix a sum which reflects the costs reasonably incurred by the person in favour of whom the order is made and any other pecuniary loss. The provisions made by the 1995 Act in respect of costs is as follows:
"138. Order for Costs
(1) The Tribunal may order the payment of costs fixed by the
Tribunal in any proceedings fixed by the Tribunal.(2) In making an order for costs, the Tribunal, unless there are
special circumstances, must fix a sum that reflects -
(a)
the costs reasonably incurred by the person in whose favour the order for costs is made; and
(b)
any other pecuniary loss incurred by that person because of the proceedings.
(3) The Tribunal may order that bills of costs be taxed or settled by
the Registrar."
I note without further reference that the phrase "taxed" was altered to "assessed" in a later amendment.
The background to the proceeding before the Tribunal, and before this Court, may be briefly described. The complainant Anthony Wilson was employed by the first respondent ("Phoenix") as its Victorian State Manager between 20th March 1995 and 26th July 1995 when he was dismissed. He claimed that during the period of employment he was a victim of a number of acts of a sexual nature by employees, one of whom was the second-named respondent. She was also the wife of the principal of Phoenix. The second respondent was also a director and substantial shareholder in Phoenix. Fundamentally the appellant alleged that his dismissal from his job arose because of his rejection of the advances of the second respondent, Ms Haig. As a result of all of this, including the dismissal, he claimed substantial losses and loss to reputation, and sought declarations, an apology and damages. The respondents denied the alleged acts of discrimination and sexual harassment and claimed that he had been terminated for failing to perform his duties satisfactorily. On 15th May 1996 the appellant Wilson lodged a complaint with the Equal Opportunity Commission against the respondent and that complaint was referred to the Tribunal on 23rd December 1996, pursuant to s.117(1)(b) of the 1995 Act. Because the conduct about which he complained took place before 1st January 1996 when the major part of the provisions of the 1995 Act came into operation, and the repeal of the 1994 Act became effective, the complainant in effect had to prove the act complained of contravened both Acts. However, I have set out the relevant cost provisions and it is not necessary for me to re-visit the differing provisions of the 1984 and 1985 Acts on the liability issue. As I have indicated, Mr. Wilson was dismissed from his job at Phoenix on 27th July 1995. Until that time no written allegation had been made by him of any sexual harassment although he alleged he had made oral complaints to the second respondent. No complaint was lodged with the Commission until nearly ten months after his dismissal.
The hearing before the Tribunal occupied nine hearing days. Both the appellant and respondents were represented by counsel. A large number of witnesses gave evidence about the claimed acts of sexual harassment and associated matters. There were also complaints made of sexual harassment of Wilson by one Earnshaw, a male employee of Phoenix. The hearing concluded on 18th December 1997. The reasons of the three-person Tribunal were delivered on 27th March 1998. They occupy 28 pages, examined the evidence given in detail, incident by incident, and expressed views as to the credibility of various witnesses. Essentially, the Tribunal accepted the evidence of Haig and Earnshaw and rejected the evidence of Wilson and his witnesses. It therefore dismissed the complaint. On the issue of costs, the Tribunal noted the terms of s.138 and that the discretion of the Tribunal to award costs is very wide. It stated:
"There is no general rule adopted by this Tribunal that the successful party is entitled to costs (see Murphy v. Colorific Lithographics ADT of Vic 22.1,97). In exercising its jurisdiction the Tribunal must have regard to the nature of the jurisdiction. If orders for costs are made too readily people might be deterred from coming to the Tribunal and to that extent the policy of the legislation would be frustrated."
The Tribunal went on to consider a Tribunal decision in Delmonaco v. N.R.U. Weekly Pty. Ltd. (ADT of Vic, 3.4.97) a case in which the Tribunal had awarded costs to a successful respondent under s.109 in which the Tribunal had found that the claim was not maintainable and had had no reasonable prospect of success. The Tribunal in that case had stated that where a complainant had made a complaint without having reasonable grounds for expecting that it might succeed, it was appropriate to order costs in favour of the respondent.
The Tribunal recognized that it should not lightly find that a claim should not have been brought, as it was the intention of the legislation that a person with a bona fide claim would bring it to the Commission, and if it was not resolved, have the matter determined by the Tribunal. It then went on to say:
"After having reviewed the whole of the evidence we conclude that this was a case that had no reasonable prospect of success and should not have been brought against the Respondents. Of particular note are the following:
• The view that we have taken of Mr Wilson's evidence; • the implausibility of much of Mr Wilson's evidence; • the documentation, which heavily supported the Respondents'
case and was largely inconsistent with Mr Wilson's case;• the delay in making the complaint and the changing nature of the complaint over time, neither of which was satisfactorily explained; • the stark differences between Mr Wilson's evidence and our
ultimate findings of fact.Taking all of these matters into account we find that, if Mr Wilson did have a bona fide belief in the genuineness of his own claim, it was so lacking in any real foundation that he should never have brought it against the Respondents."
It is necessary for me to refer to some submissions made by the parties concerning costs to the Tribunal on 18th December, the final day of the hearing. After Mr. P. Ginnane of counsel (who appeared for the appellant there and on this appeal) and Mr. S. Stuckey (counsel for the respondents both before the Tribunal and here) had addressed the Tribunal, counsel for Wilson sought to make submissions in reply. Before he did so the Deputy President Chair of the Tribunal said:
"Perhaps you could deal with this while you are on your feet, that in regard to costs in this Tribunal, it is not known of course which party has won the application, but costs are not awarded as a matter of course, and usually some special circumstances need to be demonstrated by one or other of the parties, whosoever is applying for an order for costs, why an order for costs ought to be made."
The Deputy President went on to say:
"If in your case, if your client succeeds, is he applying for costs and, if so what factors do you say ought to lead the Tribunal to depart from its usual practice and award costs? And then we will ask Mr. Stuckey exactly the same question, if his client should succeed."
Counsel for the complainant submitted that there would be no circumstances in this case which would warrant the departure from the normal order (that is that no costs should be awarded). He said:
"Everyone would love costs, who does not? There would be no circumstances if the application by the complainant was made out which would warrant me telling her or requesting the Tribunal to depart from the normal course."
After Mr. Ginnane had dealt with other aspects of the reply, the Tribunal asked Mr. Stuckey what he wished to say about costs. Mr. Stuckey indicated that he was instructed to seek costs and, with respect to relevant factors, stated:
"This depends to some extent on the Tribunal's finding, but I point to the strength of the allegations which have been raised and publicized and the weakness of the evidence which has been led to support them. I would point to the damage which has been done to the reputation of those involved on the respondents' side and the apparent cavalier attitude in which that approach has been taken. I would point to the extent of the hearing which has been obliged by the complainant's proceeding and the degree o f expense. ... It has been a lengthy hearing and from the respondents' point of view a very expensive one."
He went on to say that they had been obliged to deal with allegations that were only marginally relevant, referring to the Earnshaw allegations which he said never stood any significant chance of success. He submitted that if the respondents' view of the evidence was accepted, then the entire proceeding had been frivolous and vexatious and the appropriate message should be sent to those, perhaps at the less vulnerable end of the spectrum, to seek to make use of the Tribunal's proceeding in a "casual" fashion. I should say Mr. Stuckey to me said that the word was "cavalier" not "casual". Mr. Ginnane sought to reply, and was given leave to respond. He disputed the comments concerning publicity and Mr. Earnshaw. He addressed and rejected the submission that Wilson's claim was frivolous and vexatious.
The appellant appealed against this costs order and in accordance with the requirements of s.109 formulated (the respondent not appealing) the following questions for the appeal:
"1.
Whether it was open to the Tribunal to have made the order for costs in favour of the Respondents pursuant to Section 138 of the Equal Opportunity Act 1995 ("the Act"):
(a)
In the absence of a finding by the Tribunal that the conduct complained of by the Appellant would have had it been proved nonetheless not constituted a contravention of the Act.
(b)
In the absence of a finding by the Tribunal that the Appellant had not commenced or continued his Complaint in bad faith or for an ulterior purpose.
(c)
In circumstances where the Equal Opportunity Commission had investigated the Complaint and had not declined to entertain the Complaint pursuant to Section 108(2) of the Act and the Complaint had been referred to the Tribunal for hearing.
(d)
By reason of the Tribunal's failure to invite further submissions on an award of costs after publishing its reasons for decision thereby precluding the Appellant from having the opportunity to address the Tribunal on the particular factual findings made by it to support its exercise of power to award costs."
The task of the appellant on this appeal is self-evidently formidable. The language of the empowering statute in respect of costs is very wide and would have to be viewed as being an unfettered discretion, save in accordance with the principles that the law has traditionally supported. See Spencer v. Dowling [1997] 2 V.R. 127 at 148.
Subject to the matters of policy and practice referred to in the reasons for the Tribunal, there is no reason to doubt that the power of the Tribunal to determine the issue of costs, including whether the successful respondent should obtain an order for costs, might be exercised at least by having regard to the general principles that inform courts in deciding the issue of the awarding of costs. See Halby v. Dennis (1955) 95 C.L.R. 661; Ritter v. Godfrey [1922] K.B. 47 at 66; Thorne v. Doug Wade
Consultancy Pty. Ltd. [1985] V.R. 433 at 498-499; Verna Trading Pty. Ltd. v. New India
Assurance Co. Ltd. [1991] V.R. 219.
Having regard to the formulation of the questions of law, and the argument in support of them, it was bound to be a difficult argument that it was not open to the Tribunal to have made an order for costs in favour of the victorious respondents. The discretionary power does not lack boundaries, but it must be said that to award costs in favour of the respondents after a nine-day case hardly initially produces in the mind of a reviewing Tribunal that some miscarriage of justice has occurred. Mr. Ginnane claimed from the Bar table that there had been no case in which a successful respondent had ever been awarded costs. This did not seem to be conceded by Mr. Stuckey and I would not likely be prepared to act upon that assertion, particularly in view of some other remarkably broad claims made by counsel in the course of the argument of this appeal.
There is little utility in going through the four identified questions because counsel for the appellant appeared to me ultimately to treat them as being particulars of the argument that he might have advanced in support of ground (d). I refer briefly to those grounds. Ground (a) verges on the meaningless and nothing advanced by counsel rendered it meaningful. The argument appeared to be that if the appellant had succeeded in his case there must have been a contravention of the Act. I do not propose to waste time on this palpable absurdity. Ground 1(b) appeared to be that the Tribunal could not order the appellant pay costs unless it made a positive finding that the complaint had been made in bad faith for an ulterior purpose. Counsel was unable to cite any authorities in support of this remarkable proposition, which, if true, would mean that costs could not be awarded against a failing appellant unless he or she acted 'male fide'. Even for a Tribunal required to pay heed to policy liberalities as this Tribunal is, this submission must be regarded as insupportable; (c) was not addressed and appeared to be withdrawn. Paragraph 1(d) encapsulated in a general way the main thrust of the argument of the appellant. The substance of the argument of Mr. Ginnane was that the appellant was excluded from addressing argument to the Tribunal subsequent to the matters upon which it relied for the making of the order for costs against the appellant had been identified. It seems to me that in the course of the debate between counsel and the Court the argument became reduced to that single complaint, namely that there was a breach of natural justice in precluding the appellant from the opportunity to address the Tribunal on the particular facts or findings made by it to support its exercise of the power to award costs. I should state that the appellant did not make any application to be further heard at any time.
In the context, this has meant little more than that the appellant did not have an opportunity to put to the Tribunal that it should not take into account in the exercise of the undoubted power to award costs that its view of Wilson's evidence, namely that it was so implausible, so unacceptable, so to the contrary of other evidence, so to the contrary of the documents in the case (including those prepared by Wilson) that the appellant had not been heard on the costs issue.
It should not be overlooked that the issue on the appeal really is whether or not the discretion of this Tribunal had miscarried, that is, that it was not entitled to take the view that Wilson's case "was so lacking any real foundation" that it should never have been brought. However, this was the finding that was made. No one was in a better position to make the evaluation of the worthlessness of the case than the Tribunal. They assessed it as a hopeless case. The laudable policy objective of not discouraging complainants with genuine cases from bringing them because of the threat of the costs orders has little to do with the case of an executive making what were here found to be baseless charges against his employer, ones which must have been regarded as having a high risk of being regarded as fanciful or lacking in foundation.
Even without resorting to the farthest boundaries of the wide discretion conferred upon this Tribunal to award costs, there must be cases in which it concludes that because of the particular circumstances costs ought to be ordered. The facts of this particular litigation are fatally damaging to the appeal. I pass over the issue that the power to award costs is discretionary and that the exercise of the power is a question of "practice and procedure" for the purposes of an appeal: see Kenny v. Vauxhall (1955) V.L.R. 321; Cummins v. Lewis (1993) 41 F.C.R. 559. There must be a strong presumption in favour of the correctness of such a discretionary decision and it is not necessary for me to pursue further the well-known proposition, referred to again and again, that the Court will only interfere with the exercise of the discretion if the Tribunal below has acted on a wrong principle or has failed to give appropriate weight to matters that are relevant or given too much weight to irrelevant matters or have taken a wholly mistaken view as to the facts. See House v. R. (1936) 55 C.L.R. 499; Australian Coal & Shale v. Commonwealth (1953) 94 C.L.R. 621. I say in passing that ground 1(c) appears to be misconceived as the Commission does not perform any investigatory function in relation to complaints. Mr. Ginnane did not develop this point and I deem it to have been abandoned. In any event there was no evidence before the Tribunal to suggest that the Commission had ever undertaken such an exercise or determined whether the complaint fell within the category which it might exclude.
The principal focus of the argument of the appellant was that it was required that the appellant be given a reasonable opportunity to make submissions on the question of costs. It was submitted that the invitation to address on costs at the close of counsel's submissions was a less than reasonable opportunity to do that. It was also put that that on a reading of the Tribunal's decision it was apparent that it had decided to make the appellant pay the costs because his credibility was totally unacceptable. The substance of this argument was that if the appellant had been given the opportunity to argue to the contrary of an order of costs after the decision had been announced, it could have been put that the issues of the unacceptability and the implausibility of the evidence of the plaintiff ought not to have been a feature in the decision of the awarding of costs. This, it was submitted, was not a factor that could activate the exercise of discretion to award costs. As I indicated to Mr. Ginnane in argument, I do not accept the suggestion that a tribunal empowered with the widest of discretions as to costs could only order costs against a failed applicant if they decided in effect that the case was a trumped-up case or fraudulently brought. This is a proposition that lacks conviction and it could hardly be thought to be unfair to order costs against a failed applicant in a case in which there had been a baseless assertion of sexual impropriety both against a woman and a man.
If this were not enough, the fact that the plaintiff's counsel was given an opportunity to address on any aspect of costs, and availed himself of the opportunity, is a potent argument against the allowing of the appeal. It is obvious on reading the material that the plaintiff's counsel "risked" appearing to be the party merely seeking the attainment of justice and not requiring any costs, as a forensic strategy. The reading of the written submission concerning costs makes it clear that the plaintiff's counsel without demur accepted the invitation to make pre-decision submissions on costs. When invited to make submissions for costs, he had a number of options. One was to decline to make any submission. Another was to make submissions, and this was the one availed of; the third was to assert the right to make submissions after the Tribunal had decided the case and delivered its reasons. I daresay that it might be said that the best practice of a court might be, and frequently is, to invite the parties to make submissions in respect of costs after the decision and the delivery of reasons for it. In the case of this Tribunal it was under a statutory obligation to give the parties to a complaint a reasonable opportunity, inter alia, to make submissions to the Tribunal (s.147(1)(b)). In my judgment, the Tribunal did this. It invited both sides, in advance of the decision, to make submissions as to how, depending on what the decision was, to put arguments concerning costs. Neither the Tribunal nor the Court can be the supervisor of how a party takes best advantage of the proferred opportunity. See Sullivan v. Department of Transport (1978) 20 A.L.R. 323 at 343 (Deane, J.). This was a case entirely turning on questions of credibility. It was not a case in which a particular point of law or construction of the statute might become critical, so that the question of the ordering of costs would be dependent upon some unanticipated event or argument. The invitation to address on costs at the close of submissions was, in my judgment, a reasonable opportunity to address on costs in a case that was "facts" from beginning to end. Counsel for the appellant argued that he had been deprived of an opportunity to put appropriate submissions, but was wholly unable to point to any conduct of the Tribunal that had amounted to such deprivation. Reliance was placed on the Tribunal "sitting mute" and, in effect, not "tipping him off" that they were against him on the facts. Mr. Ginnane argued that he should have been told by the Tribunal, when asked to make submissions as to costs, that his case was in difficulties. Unhappily for this proposition, when the reasons were given, he accepted that he could not challenge the findings of fact but could have only argued that the strength of the findings of fact was not a matter which could have been taken into account in ordering costs. I will return to this facet of his submission which is plainly wrong.
In any event, there was, as Mr. Stuckey argued, no impediment to putting further submissions on the issue of costs in the three-month waiting period. Mr. Ginnane was inclined to submit that he could not waive his rights since he did not know what the findings were. This is incorrect as the waiver of the right there concerned was the waiver of the right to argue that the time for submissions as to costs was later. As I have indicated, counsel could have declined the opportunity to make any submission as to costs and insisted upon a right to make them when the decision had been pronounced. In Vakauta v. Kelly (1989) 167 C.L.R. 568 (see in particular 572, 577 and 587) the High Court of Australia clearly established that non-objection might amount, in the appropriate circumstances, to waiver of a right of appeal. Also relevant is the decision of the Appeal Court of the Family Court of Australia in the marriage of D.J. and M.Y. Collins 14 FAM.L.R. 162, as an example of the application of the statements from the majority decision in Vakuata v. Kelly (supra). In Collins the husband's counsel's failure to object to a time limit upon the period of cross- examination (that is, a procedural irregularity) was held sufficient to amount to waiver of the right to object and prevented the husband from objecting by way of appeal. This was a case in which the Vakauta v. Kelly principle was applied outside the allegation of bias with which the case was concerned, being applied in the case of the audi alteram partem rule, the one applicable in the present proceeding. As the Court in Collins said, the bias rule and the audi alteram partem rule each stem from the same fundamental principle and there is no reason for making a distinction as to waiver in respect of one from the other. In terms of the general principle, I refer to, in Vakauta v. Kelly (supra) the words of Dawson, J.:
"In my view, where a party in civil litigation, being aware of the circumstances giving rise to a right to object, allows the case to continue for a sufficient time to show he does not presently intend to exercise that right, he may be held to have waived it."
His Honour also stated (639):
"Although justice must manifestly be seen to be done, where a party, being aware of his right to object, waives that right, there will be little danger of the appearance of injustice."
In Collins, the Family Court of Appeal had no doubt that the consequence of shutting down the trial was inappropriate, particularly as very little extra time was required to complete the evidence. However, in that case, that meant no more than a failure of best practice, just as it may be thought by some to be a want of best practice here. I should not be thought to be expressing any view that that is so in this case. For my own part, I would regard it as a practice to be preferred as a general rule, that the parties should be heard on costs after the delivery of the decision and reasons, rather than before. Doubtless, the Tribunal in this case, after a nine-day hearing, was not anxious to add to the costs of the parties by inviting later and further submissions orally or in writing, particularly in a case in which, as it ultimately appears, it had what appears to be a strong view that the complainant's evidence and that of his witnesses was absolutely unacceptable. A practical approach to the disposition of these matters is to be encouraged rather than discouraged. It was a matter for the Tribunal to decide whether or not in exercising its discretion as to costs it was just as well aided by hearing the parties before it embarked upon the decision as to the facts of the case as afterwards. Speaking for myself, I have little doubt that the decision made about the costs was absolutely correct and it would have been extraordinary, even allowing for the policy imperatives which the Tribunal, having regard to the statute, rightly considers, if any different decision had been made.
For these reasons the appeal must be dismissed. I will hear counsel on the question of costs.
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