DECISION

Fair Work Act 2009
s.401 - Application for costs orders against lawyers and paid agents

Tamer Selcuk
v
Maddison & Associates Pty Ltd
(U2015/4839)

Costs application against lawyer.

[1] This matter involves an application for a costs order arising from an appeal against the decision of Ryan C in U2014/8741 1.

[2] The Applicant in this matter, who was also the applicant in the initial unfair dismissal matter, has applied for two costs orders, one against the Respondent in the unfair dismissal matter and the other against the respondent’s legal representative, Maddison and Associates P/L. The Applicant has sought two separate costs orders: firstly, an order that the Respondent pay the costs of the Applicant with respect to the application for permission to appeal, and secondly, that Maddison and Associates P/L pay a portion or all of the costs of the Applicant with respect to the application for permission to appeal.

[3] This application only deals with the costs order sought by the Applicant against Maddison and Associates P/L.

[4] The parties filed written submissions and witness statements in support of their respective positions and all parties agreed that the Commission determine the costs applications on the papers.

Relevant Statutory provision

The Fair Work Act 2009 deals with the issue of costs orders against a party’s representative in s.401 and s.402 which are as follows:

“401 Costs orders against lawyers and paid agents

(1) This section applies if:

(a) an application for an unfair dismissal remedy has been made under section 394; and

(b) a person who is a party to the matter has engaged a lawyer or paid agent (the representative) to represent the person in the matter; and

(c) under section 596, the person is required to seek the FWC’s permission to be represented by the representative.

(1A) The FWC may make an order for costs against the representative for costs incurred by the other party to the matter if the FWC is satisfied that the representative caused those costs to be incurred because:

(a) the representative encouraged the person to start, continue or respond to the matter and it should have been reasonably apparent that the person had no reasonable prospect of success in the matter; or

(b) of an unreasonable act or omission of the representative in connection with the conduct or continuation of the matter.

(2) The FWC may make an order under this section only if the other party to the matter has applied for it in accordance with section 402.

(3) This section does not limit the FWC’s power to order costs under section 611.”

“402 Applications for costs orders

An application for an order for costs under section 611 in relation to a matter arising under this Part, or for costs under section 400A or 401, must be made within 14 days after:

(a) the FWC determines the matter; or

(b) the matter is discontinued.”

Applicant’s reliance on s.401

[5] The Applicant has sought to rely on s.401 as enabling the Applicant to apply for a costs order under that section. The relationship between the various costs provisions in the Fair Work Act has been commented on by the Commission in other matters. In Church v Eastern Health t/as Eastern Health Great Health and Wellbeing a Full Bench said:

“[16]…. At the outset it is important to appreciate that the Commission, as a statutory tribunal, has no inherent power to make costs orders. Its powers to make such orders must be derived from the FW Act. Depending on the circumstances the Commission can order costs under ss 376, 400A, 401 611 and 780 of the FW Act. The scope of these provisions and the circumstances in which they operate vary.

[17] Section 376 deals with costs orders against lawyers and paid agents in relation to general protections applications made under ss 365 or 372. Section 780 is in similar terms and applies to applications under s.773 for the Commission to deal with a dispute alleging that the employer has terminated an employees' employment in contravention of s.772.

[18] Section 400A provides that the Commission may make a costs order against a party to a matter arising under Part 3-2, if satisfied that the first party caused those costs to be incurred because of their unreasonable act or omission in connection with the conduct or continuation of the matter. Part 3-2 of the FW Act deals with 'Unfair Dismissal'. Section 401 deals with costs orders against lawyers and paid agents in relation to applications for an unfair dismissal remedy under s.394.

[19] The costs application before us arises from an appeal under s.604 of the FW Act. No party contended that ss 376, 400A, 401 or 780 had any application in the present circumstances and, on their face, they do not. The costs application is brought under s.611(2)(a).” 2

[6] In the present matter the costs applications relate to appeal proceedings and therefore s.401 has no application to such proceedings. Appeal proceedings arise under Part 5-1 of the Act and even though the appeal may be about a decision issued under Part 3-2 of the Act (the Unfair Dismissal provisions) the appeal is not a matter arising under Part 3-2 and s.401 only relates to a matter arising under Part 3-2. To the extent that the Applicant relies on s.401 such reliance is misplaced and the Applicant cannot seek a costs order against Maddison and Associates P/L pursuant to s.401.

[7] The application is dismissed.

COMMISSIONER

 1   [2015] FWC 437.

 2   [2014] FWCFB 810 at paras 16 to 19.

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