Vercoe v AMP Shopping Centres Pty Limited and Hardy [1999] NSWADT 89 (17 September 1999)

Last Updated: 29 September 1999

NEW SOUTH WALES ADMINISTRATIVE DECISIONS TRIBUNAL

CITATION: Vercoe -v- AMP Shopping Centres Pty Limited and Hardy [1999] NSWADT 89

DIVISION: Equal Opportunity

APPLICANT:

Maureen Vercoe

RESPONDENT:

AMP Shopping Centres Pty Limited (First Respondent)

Ian Hardy (Second Respondent)

FILE NUMBERS: 991052

HEARING DATES: 08/24/99

SUBMISSIONS CLOSED: 24/08/1999

DECISION DATE: 17/09/1999

JUDICIAL MEMBER: N Hennessy Deputy President

LAY MEMBER: S Bullock Member

LAY MEMBER: M Luger Member

APPLICANT KEYWORDS: Sexual Harassment - Employment; Victimisation

MATTER FOR DECISION: Application for security of costs

PRIMARY LEGISLATION CITED: Anti-Discrimination Act 1977

APPLICANT REPRESENTATIVE: J Woodward, solicitor, JJ Woodward & Co

RESPONDENT REPRESENTATIVE: J Oakley of counsel instructed by Minter Ellison

ORDERS: 1. Notice of Motion dismissed.

2. No order as to costs.

DECISION:

Background

1 These proceedings concern a Notice of Motion filed with the Tribunal on 6 August 1999 seeking an order that the complainant provide security for the respondent's costs in the sum of $31,875.00 or such other amount as the Tribunal determines.

2 The applicant in relation to the Notice of Motion, AMP Shopping Pty Limited and Mr Hardy, are the respondents in proceedings before the Equal Opportunity Division of this Tribunal. The respondent to the Notice of Motion, Ms Vercoe, is the complainant in those proceedings. As this decision relates to the Notice of Motion, AMP Shopping Pty Limited and Mr Hardy will be referred to as the applicants and Ms Vercoe will be referred to as the respondent.

3 The respondent lodged a complaint of sexual harassment against the applicants with the Anti-Discrimination Board on 8 September 1998. The respondent alleged that Mr Hardy, an employee of AMP Shopping Pty Ltd, had sexually harassed her. A victimisation complaint was lodged on 20 October 1998 on the ground that her employment had been terminated because she had lodged a complaint. The President declined both complaints and the respondent subsequently exercised her right to have both matters referred to the Tribunal for hearing.

Issues and legislation

4 The Tribunal's power to order security for costs is found in section 114 of the Anti-Discrimination Act 1977 which states that:

(1)Except as provided by section 111(2) and subsection (2) each party to an inquiry shall pay his or her own costs.

(2) Where the Tribunal is of the opinion in a particular case that there are circumstances that justify it doing so, it may make such order as to costs and security for costs, whether by way of interim order or otherwise, as it thinks fit.

5 Section 111(2) is not relevant to these proceedings.

6 The rationale for an application for security for costs is to prevent abuse of process. The applicant in this case is an unwilling participant in the litigation process and should not be prejudiced by the respondent's inability to pay costs, if ordered to do so. But the Tribunal must also ensure that such an application is not used oppressively to discourage or prevent a complainant from proceeding.

7 The applicant submitted that there were five circumstances which would justify the Tribunal making an order for security for costs. These were:

· that the President of the Anti-Discrimination Board declined the respondent's complaints of sexual harassment and victimisation;

· that the respondent failed to attend the conciliation conference arranged by the Board without notifying the applicant or the Board;

· that the respondent no longer resides in New South Wales and that she has not provided the applicants with a current address for service;

· that the respondent has not complied with the timetable set down by the Tribunal in a Directions Hearing; and

· that the respondent engaged in media publicity concerning her complaint contrary to the advice of the President of the Anti-Discrimination Board.

Evidence

8 The applicant tendered an affidavit dated 6 August 1999 of Ms Jennifer Patterson, the solicitor acting for the applicant in these proceedings and in the equal opportunity proceedings. Ms Patterson stated that she, Mr Hardy (one of the respondents in the equal opportunity proceedings) and Ms Elise Burch, legal counsel for AMP Shopping Pty Ltd, drove to the Anti-Discrimination Board's offices in Newcastle to attend a conciliation conference. She said that on their arrival Ms Kay Jackson, the Manager of the Newcastle Branch of the Board, advised her that Ms Vercoe was in Cairns and would not be attending the conference. Mr Hodgins, a solicitor employed by JJ Woodward and Co, the lawyers representing the respondent, attended the conference on behalf of Ms Vercoe.

9 Ms Patterson stated that during the conciliation conference Mr Hodgins said words to the effect that "Maureen Vercoe is unable to attend today because she is in Cairns." Ms Patterson also said that Mr Hodgins attempted to contact Ms Vercoe at one stage to obtain instructions but came back saying "She's in a meeting in Cairns and can't be interrupted." Ms Patterson's affidavit goes on to say that Mr Hodgins later contacted Ms Vercoe when pressed by Ms Jackson. Ms Patterson agreed in cross examination that Mr Hodgins was able to speak to Ms Vercoe on that occasion and that he returned to the conference with his client's instructions.

10 Ms Patterson also said in her affidavit that Nick Floreani, counsel for Ms Vercoe at the Directions Hearing, told her that Ms Vercoe was living in Melbourne. When questioned, Ms Patterson agreed that she had not asked the respondent's solicitors for Ms Vercoe's address.

11 The respondent tendered an affidavit of Mr Hodgins. Mr Hodgins agreed, despite the denial in his affidavit, that the President of the Anti-Discrimination Board had decided that the complaint of sexual harassment was lacking in substance and that the complaint of victimisation was misconceived.

12 Mr Hodgins referred to page 5 of the Board's publication "Conciliation: A guide for complainants and respondents" which states that "If the respondent is a large organisation, they should try to send someone who has not already had unpleasant contact with the complainant and who is not personally named in the allegations." The respondent tendered a letter from his firm to the Board dated 11 March 1999 which referred to these guidelines and stated that:

"AMP Shopping Centres Limited is certainly a large organisation and Mr Hardy is certainly a person who has "already had unpleasant contact with the complainant" and "is personally named in the allegations." Our client does not wish ever again to be in the same room with Mr Hardy and requests that he not attend."

13 Mr Hodgins said that his firm did not receive a response to that letter from the Board. He also agreed that he had never written a follow up letter advising the Board or the applicant that Ms Vercoe would not be attending the conciliation conference.

14 Mr Hodgins denied the conversation attributed to him by Ms Patterson in her affidavit. However, in cross examination, he agreed that he did say that one of the reasons Ms Vercoe was not at the conference was that she was living in Queensland. He also said that he made it clear that another reason was that she did not want to be in the same room with Mr Hardy. Mr Hodgins conceded that it was difficult for him to remember exactly what he had said.

15 Mr Hodgins remembered ringing Ms Vercoe during the conciliation conference and being told that she was unavailable and then ringing her again and obtaining her instructions.

16 Mr Hodgins said Ms Vercoe now lives in Elwood, Victoria. The applicant has never contacted him or his firm, as far as he knows, to obtain her address. Mr Hodgins also conceded that he has not taken any steps to advise the applicant of Ms Vercoe's address.

Findings of fact

17 There is no dispute that Ms Vercoe did not attend the conciliation conference and that Mr Hodgins attended on her behalf. The applicant's solicitors were not advised either by the respondent's solicitors or the Board that Ms Vercoe would not be there. The applicant and their solicitors expected Ms Vercoe to be there given the Board's letter of 22 February 1999 which said that "Ms Vercoe and Mr John Woodward will also attend."

18 Ms Vercoe's solicitor did not receive a reply from the Board to their letter of 11 March 1999 requesting that Mr Hardy not attend the conference. We find on the basis of the correspondence and evidence of Mr Hodgins, that Ms Vercoe did not attend the conference because she was working in Cairns and because she did not want to be in the same room as Mr Hardy. Unfortunately the applicant's solicitors were not advised of this before they attended the conference. However Mr Hodgins was able to obtain instructions from his client by telephoning her during the conference.

19 Ms Vercoe's solicitors have never advised the applicant's solicitors of her new address, neither have the applicant's solicitors ever requested this information. Mr Woodward advised the Tribunal of Ms Vercoe's current address during the course of the hearing.

20 Mr Hardy is a party to the equal opportunity proceedings in his own right. Contrary to Mr Woodward's submission, he was not attending the conciliation conference as a representative of his employer. Under s 22B(2) of the Anti-Discrimination Act 1977 it is unlawful for an employee to sexually harass a fellow employee. If such discrimination is proved the harasser may be personally liable.

Application of law and decision

21 There is no guidance in the Anti-Discrimination Act 1977 as to the circumstances which would justify an order for security for costs. Consequently the Tribunal has a broad discretion to make orders where it thinks fit. Some of the factors which have been regarded as relevant, but not necessarily decisive, in the exercise of this discretion are listed by Jim Delany in "Security for Costs" (1989) Law Book Company Ltd at 130. These include:

· the plaintiff's prospects of success;

· the defendant's prospects of success;

· whether the claim is bona fide;

· applications being made oppressively;

· the nexus between the plaintiff's impecuniosity and the defendant's conduct;

· whether the making of an order for security may stultify the litigation; and

· public police considerations.

22 In the context of the Tribunal's jurisdiction, where costs are not normally awarded, "the prospect of an award of costs being made" could be substituted for the first two factors, namely the plaintiff's and defendant's prospects of success.

23 The Supreme Court and District Court Rules of New South Wales each set out a non-exhaustive list of categories in which orders for security for costs can be made. For example, both the District Court and Supreme Court Rules give the court discretion to order security for costs where the address of a plaintiff is not stated or is mis-stated in his or her originating process, unless the omission or mistake was not made with the intention to deceive. (DC Rules; Pt 40 r 1(2); SC Rules; Pt 53 r 2(1)(c) and r 2(2))

24 The District Court Rules give the court discretion to order security for costs where a plaintiff is ordinarily resident outside Australia whereas in the Supreme Court Rules the discretion is available were the plaintiff is ordinarily resident outside New South Wales (Pt 53 r 2(1)(a)). The Supreme Court Rules also cover the situation where a plaintiff has changed his address after the commencement of the proceedings with a view to avoiding the consequences of the proceedings (Part 53 r 2(1)(d)).

25 The ordering of security of costs in relation to a person who ordinarily resides outside Australia is designed to catch those cases where a costs order, if made, would not be enforceable in the jurisdiction in which the person resides. The same rationale cannot be used in relation to a person who is ordinarily resident outside New South Wales but within Australia. In that situation the Service and Execution of Process Act 1992 (Cth) allows a costs order to be enforced in any State or Territory. In addition, such a provision would seem to fall foul of s 117 of the Constitution which prohibits discrimination against a person because of the State in which they reside. (Australian Building Construction Employees' & Builders Labourers' Federation v Commonwealth Trading Bank [1976] 2 NSWLR 371; Section 117 states that "A subject of the Queen, resident in any State, shall not be subject in any other State to any disability or discrimination which would not be equally applicable to him if he were a subject of the Queen resident in such other State.")

26 None of the situations envisaged by the District or Supreme Court Rules applies to this case except that the respondent resides outside the State and had not, prior to the hearing on the Notice of Motion, provided the applicants with a current address for service. It is also significant that the applicant's solicitors did not ask the respondent's solicitors for her current address. That address has now been provided. Since any order of this Tribunal can be enforced in another State or Territory and the respondent's solicitor has provided the applicant's with his client's address, these are not circumstances justifying an order for security for costs.

27 The next ground submitted in support of the orders sought in the Notice of Motion was that the President of the Board had declined Ms Vercoe's complaints as lacking in substance and misconceived respectively. The applicant argued that the President's reasons for this declination indicate bad faith on the part of Ms Vercoe. One illustration of this bad faith in the applicant's submission was that she did not raise the allegations of sexual harassment until after she had received counselling for alleged poor performance, despite being given the opportunity to do so.

28 In relation to bad faith, we cannot be satisfied on the basis of the evidence currently before the Tribunal, that a delay in making a complaint until after receiving counselling for poor work performance amounts to bad faith.

29 Because costs do not follow the event, the strength of the complainant's case should not normally be considered as a reason for making an order for security for costs. In addition, the Anti-Discrimination Act 1977 envisages weak cases being litigated because s 91(1) allows the complainant to require the President to refer a matter to the Tribunal following declination.

30 The applicant's second submission was that the respondent failed to attend the conciliation conference arranged by the Board without notifying the applicant or the Board. We agree with the Board's publication "Conciliation: A guide for complainants and respondents" that "Complainants should attend the conference themselves." However, this is not always possible, especially if the complainant has moved interstate. In this case, Ms Vercoe's solicitors had told the Board that Ms Vercoe did not want to be in the same room as Mr Hardy. These circumstances adequately explain her absence. It would have been helpful if the Board had told the applicant's solicitors that Ms Vercoe did not want Mr Hardy to attend. It would also have been helpful if Ms Vercoe's solicitors had advised the applicant's solicitors of the fact that Ms Vercoe would not be in attendance and the reasons for her absence.

31 As far as Mr Hardy's attendance is concerned, he was entitled to be at the conference because he is potentially liable, as an individual, if sexual harassment is proved. If the Board had advised him of Ms Vercoe's objection to his attendance, negotiations could have taken place as to how the conference could have been conducted without the need for Mr Hardy and Ms Vercoe to be in the same room.

32 However, these matters are largely irrelevant because the complainant's failure to attend the conciliation conference in circumstances where her absence can be adequately explained and her solicitor attended on her behalf, is not a circumstance justifying an order for security of costs.

33 The next reason given to support an order for security for costs was that the respondent has not complied with the timetable set down by the Tribunal in a Directions Hearing on 21 July 1999. The respondent agreed that the directions as to the filing of points of claim by 18 August 1999 had not been complied with but he did file them on 23 August 1999. Mr Woodward, the respondent's solicitor, submitted in explanation for this delay, that the directions hearing made no reference to the application for security for costs and he thought it more appropriate to await the outcome of the Notice of Motion before filing any further documents. The applicant contended that directions were made in relation to a potential application for security for costs at the directions hearing. This contention is supported by the Tribunal's file which shows that the matter was referred to the registry for a date for the application for security for costs and the parties were given a timetable in relation to the Notice of Motion. It was the Tribunal's intention that the substantive proceedings should not be delayed pending the hearing for security for costs.

34 In any event, a delay of five days in the lodging of the Points of Claim is not a circumstance justifying an order for security for costs. While the Tribunal views failure to comply with the timetable as a serious issue, the appropriate responses will generally be a reminder or a warning and ultimately a costs order.

35 A further reason the applicant advanced in support of the Notice of Motion was that the respondent engaged in media publicity concerning her complaint contrary to the advice of the President of the Anti-Discrimination Board. The President's report contains correspondence which indicates that the Board does advise parties that "The Board will deal with this complaint confidentially. The Board asks that you also treat this complaint as confidential." However failure to keep a complaint confidential is not a circumstance which would justify an order for security for costs. The main disadvantage of breaching confidentiality is that it is likely to prejudice the success of a conciliation conference or mediation.

36 Although the Tribunal does have power to order security for costs, such an order would only be justified in rare circumstances. Because the normal costs rule is that each party pays their own costs, the Tribunal would firstly have to assess the prospect that a costs order would be made against the complainant at the conclusion of the hearing. Secondly, the Tribunal would have to be satisfied that any costs order it did make may not be met. This could be the case where there was evidence that the complainant was attempting to conceal his or her address or was ordinarily resident outside Australia.

37 None of these circumstances exists in this case, consequently the Notice of Motion is dismissed.