Director-General of Education and Training and Bond (No 2) [2009] NSWIRComm 59 (6 May 2009)

Last Updated: 8 May 2009

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION :
Director-General of Education and Training and Bond (No 2) [2009] NSWIRComm 59



FILE NUMBER(S):
IRC 2423

HEARING DATE(S):
Written Submissions: 3 April 2009 and 16 April 2009

DATE OF JUDGMENT:
6 May 2009

PARTIES:
APPELLANT
Director-General of Education and Training

RESPONDENT
Judith Anne Bond

CORAM:
Kavanagh J Staff J Bishop C


CATCHWORDS: Costs - Unfair dismissal - Extension of time - Appeal - Respondent sought costs of appeal - Limited jurisdiction to award costs - Unable to determine whether application frivolous or vexatious at this stage - Whether appeal application under Pt 6, ch 2 of Industrial Relations Act 1996 - Application for costs refused - Industrial Relations Act 1996, s 181(2)(a)(b)(c)

LEGAL REPRESENTATIVES
APPELLANT
Mr S Flanigan of counsel
Senior Legal Officer: Mr C Miles
Department of Education and Training
RESPONDENT
Mr MD Broun QC
Solicitor: Ms V Ho
Spinks Elphick Ho

CASES CITED:
Director-General of Education and Training and Bond [2009] NSWIRComm 40
Kanan v Australian Postal and Telecommunications Union of Australia (1992) 43 IR 257
Peden v Lake Macquarie Refrigeration Pty Ltd (2003) 134 IR 149
R v Moore; Ex Parte Federated Miscellaneous Workers' Union of Australia [1978] HCA 51; (1978) 140 CLR 470 at 473

LEGISLATION CITED:
Industrial Relations Act 1996


TEXTS CITED:




JUDGMENT:

- 1 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

FULL BENCH

CORAM: KAVANAGH J
STAFF J
BISHOP C

Wednesday, 6 May 2009

Matter No IRC 2423 of 2008

DIRECTOR-GENERAL OF EDUCATION AND TRAINING AND JUDITH ANNE BOND (NO 2)

Application by Director-General of Education and Training for leave to appeal and appeal against a decision of Commissioner Connor given on 16 December 2008 in matter No IRC 1024 of 2008

DECISION OF THE COMMISSION
[2009] NSWIRComm 59

1 On 26 March 2009, the Commission refused an application for leave to appeal brought by the Director-General of Education and Training ("the appellant") against a decision of Connor C, granting an application to lodge an out of time claim for reinstatement following the alleged unfair dismissal of Ms Judith Anne Bond ("the respondent"): Director-General of Education and Training and Bond [2009] NSWIRComm 40.

2 The respondent to the appeal sought costs of the appeal on an indemnity basis and costs of the hearing before Connor C. In the alternative, costs were sought on a solicitor/client basis, or a party/party basis.

3 The parties were directed to file written submissions and advised that the application would be determined on the papers.

4 The power to award costs is found within s 181 of the Industrial Relations Act 1996 ("the Act"). That section provides:

181 Costs

(1) Subject to the rules of the Commission and any other Act or law:

(a) the Commission may award costs, and

(b) costs are in the discretion of the Commission, and

(c) the Commission may determine by whom and to what extent costs are to be paid, and

(d) the Commission may order costs to be assessed on the basis set out in Division 11 of Part 3.2 of the Legal Profession Act 2004 or on any other basis.

(2) However, the Commission when it is not in Court Session may award costs only in the following cases:

(a) the Commission may award costs against an applicant if it considers that the application to it was frivolous or vexatious, or

(b) the Commission may award costs against a party to proceedings who, in the opinion of the Commission, instituted proceedings without reasonable cause, or

(c) the Commission may award costs against a party to proceedings under Part 6 of Chapter 2 (Unfair dismissals) who, in the opinion of the Commission, unreasonably failed to agree to a settlement of the claim or whose application was frivolous or vexatious, or

(c1) the Commission may award costs against an industrial agent representing an applicant or employer in proceedings under Part 6 of Chapter 2 if:

(i) the industrial agent fails to file a certificate as required by section 90A, or

(ii) the Commission finds that the industrial agent has filed a certificate under that section certifying that the agent has reasonable grounds for believing, on the basis of provable facts, that the applicant’s claim or employer’s response to the claim had reasonable prospects of success when the agent did not have reasonable grounds for believing, on the basis of provable facts, that it had reasonable prospects of success, or

(d) the Commission may award costs in proceedings for a breach of an industrial instrument or the recovery of money under Chapter 7, as provided by sections 357 and 373.

(3) The Commission in Court Session may not award costs in proceedings for a contravention of a dispute order or in proceedings under Division 2 of Part 4 of Chapter 5 (Rules of industrial organisations).

(4) In this section, costs includes:

(a) costs of or incidental to proceedings in the Commission, and

(b) in the case of an appeal to the Commission, the costs of or incidental to the proceedings giving rise to the appeal, as well as the costs of or incidental to the appeal.
5 It is pertinent to immediately observe that the Commission has a slender or limited jurisdiction to award costs. Furthermore, the jurisdiction to award costs pursuant to s 181(2)(a) and (b), lies in favour of a respondent employer.

6 Turning firstly to the proceedings before Connor C, there should be no order for costs in relation to those proceedings. They were brought by the respondent (as the applicant) seeking an indulgence from the Commission to file an application pursuant to s 84 of the Act because of her failure to file the application within the limitation period of 21 days after dismissal. The Commissioner found that in accordance with s 85(3) of the Act, there was "sufficient reason" for accepting the application which was made out of time.

7 We would observe that it would not be unusual in such circumstances, subject to jurisdiction, for an applicant who was seeking an indulgence to file an application out of time to be required to pay the respondent's costs, even where the applicant succeeded and the application was accepted out of time.

8 In respect of the respondent's claim for costs of the appeal proceedings, Mr MD Broun QC contended that the appeal was not an application under Pt 6 ch 2 of the Act, and accordingly, the discretion to award costs is not limited by s 181(2)(c). It followed, so it was submitted, that the Commission may award costs on the ground set out at s 181(2)(b), being the institution of proceedings without reasonable cause. This is in addition to the Commission awarding costs where it finds the application was frivolous or vexatious (the s 181(2)(c) ground of unreasonably failing to agree upon settlement of a claim not here being relevant).

9 This submission is misconceived. If it be correct, it would follow that any appeal in respect of an application alleging that a dismissal was harsh, unreasonably or unjust would not arise under Pt 6 ch 2 of the Act.

10 Clearly, this appeal and any appeal from a decision in respect of an application brought pursuant to s 84 of the Act is an appeal from a decision made under Pt 6 of the Act.

11 The Commission's jurisdiction to order costs against an applicant only arise if the Commission determines that the applicant has unreasonably failed to agree to a settlement of the claim, or where the Commission determines the application was frivolous or vexatious: see s 181(2)(c).

12 Senior counsel also submitted, after referring to the following authorities which considered the meaning of "without reasonable cause": R v Moore; Ex Parte Federated Miscellaneous Workers' Union of Australia [1978] HCA 51; (1978) 140 CLR 470 at 473; Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257 at 264 - 265, that the application for leave to appeal made by the appellant was, on the authorities, instituted without reasonable cause and had no prospects of success. The Full Bench's attention was also directed to authorities which considered the meaning of frivolous and vexatious: Peden v Lake Macquarie Refrigeration Pty Ltd (2003) 134 IR 149 at [19] - [20] and [28] - [29].

13 The appeal from Connor C was interlocutory. At the stage that the proceedings have reached, we are unable to determine whether the application is frivolous or vexatious. Similarly, we are not persuaded that the appeal was brought without reasonable cause, even assuming we had the power to award costs in these circumstances.

14 The appellant sought to challenge the basis upon which the Commissioner exercised his discretion at first instance. It identified, with precision, each of the bases upon which it relied in seeking to have the matter remitted back to the Commissioner for determination in accordance with law. Such arguments were unsuccessful. This of itself does not lead to a finding of "without reasonable cause" against the appellant. In R v Moore; Ex Parte Federated Miscellaneous Workers' Union of Australia, Gibbs J stated at 473:

... a party cannot be said to have commenced a proceeding "without reasonable cause", within the meaning of that section, simply because his argument proves unsuccessful. ...

15 In Kanan v Australian Postal and Telecommunications Union, Wilcox CJ said at 264 - 265:

It seems to me that one way of testing whether a proceeding is instituted "without reasonable cause" is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceedings, there was no substantial prospect of success. If success depends upon the resolution in the applicant's favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being "without reasonable cause". But where, on the applicant's own version of the facts, it is clear that the proceedings must fail, it may properly be said that the proceedings lacks a reasonable cause.

16 This is not the situation in respect of the appeal. The appellant's arguments depended upon acceptance by the Full Bench of its characterisation of the process by which the Commissioner exercised his discretion. Such a characterisation was supported by authority. Consequently, the failure to succeed on an arguable point of law is not adequate to "stigmatise the proceedings as being without reasonable cause".

17 This is not to say that an application for costs cannot be advanced at the conclusion of the substantive proceedings by either party. It may be that the provisions of s 181(2)(a) or (b) are available to the respondent employer or that the provisions of s 181(2)(c) have been triggered during the proceedings.

18 It follows that the application for costs must be refused.

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LAST UPDATED:
6 May 2009