[2015] FWC 8618 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.611—Costs application
Wendy Cowan
v
Durri Aboriginal Corporation Medical Service
(AB2015/411)
SENIOR DEPUTY PRESIDENT HAMBERGER |
SYDNEY, 15 DECEMBER 2015 |
Application for an FWC order to stop bullying – costs application – costs not ordered – costs application dismissed.
[1] On 24 June 2015, Ms Wendy Cowan applied for an order to stop bullying against the chairperson of an organisation at which she volunteers, Durri Aboriginal Corporation Medical Service (Durri) and its legal representative.
[2] On 3 September 2015, I issued a decision 1 dismissing Ms Cowan’s application for want of prosecution.
[3] On 11 September 2015, Durri applied for costs against Ms Cowan, submitting both that she had made the originating application vexatiously or without reasonable cause, and that it had no reasonable prospects of success. I subsequently issued directions for both Durri and Ms Cowan to make written submissions.
[4] The fact that the application was never prosecuted means that I have very limited information on its merits. I have determined Durri’s costs application on the material before me, comprising the parties’ written submissions as to costs, Ms Cowan’s originating application (Form F72) and Durri’s response thereto (Form F73).
Principles and consideration
[5] Durri’s costs application is made under s.611 of the Fair Work Act 2009 (Cth) (the Act), which provides:
‘611 Costs
(1) A person must bear the person’s own costs in relation to a matter before the FWC.
(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:
(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or
(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.
Note: The FWC can also order costs under sections 376, 400A, 401 and 780.
(3) A person to whom an order for costs applies must not contravene a term of the order.
Note: This subsection is a civil remedy provision (see Part 4 1).’
[6] The starting point is that each party bears its own costs in proceedings before the Fair Work Commission (the Commission). Section 611 of the Act then goes on to provide that the Commission may order exceptions to that general rule if either s.611(2)(a) or (b) is satisfied. However, even if one of those subsections is satisfied, the Commission is not obliged to order costs. It is a discretionary decision. The power to award costs pursuant to s.611(2) is to be exercised with caution and only in a clear case. 2
Vexatiously or without reasonable cause: s.611(2)(a)
[7] In Qantas Airways Limited v Carter, 3 a Full Bench of the Commission endorsed the observations of North J in Nilsen v Loyal Orange Trust4 on when an application is made vexatiously. His Honour stated:
‘[The question of whether the proceeding was instituted vexatiously]... looks to the motive of the applicant in instituting the proceeding. It is an alternative ground to the ground based on a lack of reasonable cause. It therefore may apply where there is a reasonable basis for instituting the proceeding. This context requires the concept to be narrowly construed. A proceeding will be instituted vexatiously where the predominant purpose in instituting the proceeding is to harass or embarrass the other party, or to gain a collateral advantage.’
[8] I do not accept Durri’s submission that Ms Cowan’s originating application can be so characterised. While Durri variously contended that Ms Cowan made this application to distract from its investigation into a resolution passed by its board of directors (Ms Cowan included) and to limit the services rendered by its legal representative, there is no evidence before me to support those assertions. Nor is there evidence to suggest Ms Cowan did not genuinely feel she was being bullied.
[9] In the recent decision in Keep v Performance Automobiles Pty Ltd 5 (Keep), a Full Bench of the Commission summarised the principles relevant to when an application is made without reasonable cause:
‘The proper construction of s.611(2)(a) was recently considered by a Full Bench in Church v Eastern Health t/as Easter Health Great Health and Wellbeing (Church (Church). Church is authority for the following propositions:
(i) The power to order costs pursuant to s.611(2) should be exercised with caution and only in a clear case.
(ii) A party cannot be said to have made an application ‘without reasonable cause’ within the meaning of s.611(2)(a), simply because his or her argument proves unsuccessful.
(iii) One way of testing whether a proceeding is instituted ‘without reasonable cause’ is to ask whether upon the facts known to the applicant at the time of instituting the proceeding, there was no substantial prospect of success.
(iv) The test imposed by the expression ‘without reasonable cause’ is similar to that adopted for summary judgment, that is, ‘so obviously untenable that it cannot possibly succeed’, ‘manifestly groundless’ or ‘discloses a case which the Court is satisfied cannot succeed.’’
[10] In this case, the information available to me about the merits of the application is so limited that I cannot find that it was made without reasonable cause. It is insufficient even potentially to disclose a case which I am satisfied cannot succeed, let alone a clear case in which costs should be awarded. I have not heard the applicant elaborate on her case, not even in a private conference. Nor have I had the benefit of hearing the parties test each other’s claims.
Reasonably apparent that application had no reasonable prospect of success: s.611(2)(b)
[11] In Keep, the Full Bench also summarised the principles relevant to the second limb of s.611(2) of the Act:
‘[18] As to s.611(2)(b), the FWC may make a costs order against a person if satisfied that ‘it should have been reasonably apparent’ to that person that their application had ‘no reasonable prospect of success’. The expression ‘should have been reasonably apparent’ in s.611(2)(b) imports an objective test, directed to a belief formed on an objective basis as opposed to the applicant’s subjective belief.
[19] There is Full Bench authority for the proposition that the Commission should exercise caution before arriving at the conclusion that an application had ‘no reasonable prospects of success’. In Deane v Paper Australia Pty Ltd a Full Bench made the following observation about this expression in the context of enlivening a power to award costs under s.170CJ(1) of the Workplace Relations Act 1996;
“unless upon the facts apparent to the applicant at the time of instituting the [application], the proceeding in question was manifestly untenable or groundless, the relevant requirement in s.170CJ(1) is not fulfilled and the discretion to make an order for costs is not available”. ’ [endnotes omitted]
[12] Similarly, the Full Bench in Baker v Salva Resources Pty Ltd 6 stated:
‘The concepts within s.611(2)(b) “should have been reasonably apparent” and “had no reasonable prospect of success” have been well traversed:
● “should have been reasonably apparent” must be objectively determined. It imports an objective test, directed to a belief formed on an objective basis rather than a subjective test; and
● a conclusion that an application “had no reasonable prospect of success” should only be reached with extreme caution in circumstances where the application is manifestly untenable or groundless or so lacking in merit or substance to be not reasonably arguable.’ [endnotes omitted]
[13] Durri submits that since Ms Cowan’s originating application discloses only one instance of alleged bullying behaviour against its legal representative, her claim as against him must fail on jurisdictional grounds. While it is true that the legislative definition of ‘bullied at work’ requires the alleged bully to have repeatedly behaved unreasonably towards the applicant, 7 I do not consider that it should have been reasonably apparent to Ms Cowan that her application had no reasonable prospect of success on this basis. The anti-bullying jurisdiction is still relatively new and the Act’s definition of ‘bullied at work’ is not a plain-English one.
[14] Further, even on the limited information Ms Cowan has furnished, she identifies the elements of an arguable case against Durri’s chairperson.
[15] These considerations, together with the need to exercise extreme caution in making a positive finding under this subsection, mean that I am not satisfied that it should have been reasonably apparent to Ms Cowan that her application had no reasonable prospect of success.
Conclusion
[16] I am not satisfied that Ms Cowan’s application was made vexatiously or without reasonable cause. Nor am I satisfied that it should have been reasonably apparent to her that her application had no reasonable prospect of success. Accordingly, I have no jurisdiction to order costs.
[17] I note that even if either limb of s.611(2) were satisfied, I would as a matter of discretion decline to order costs in this case. This is first because Ms Cowan was self-represented (and appears to have no access to expert advice) and therefore could not have been expected to appreciate the technical ground on which her claim against Durri’s legal representative would not have succeeded (assuming the information provided in her application in relation to him is exhaustive). Additionally, I would take into account the difficulties arising from the fact that Ms Cowan suffered a brain aneurysm which impairs her memory, a fact which appears to be uncontested.
[18] Durri’s costs application is dismissed.
SENIOR DEPUTY PRESIDENT
2 Church v Eastern Health t/as Eastern Health Great Health and Wellbeing [2014] FWCFB 810.
3 [2013] FWCFB 1811, [17].
4 (1997) 76 IR 180, 181.
5 [2015] FWCFB 1956, [17].
6 [2011] FWAFB 4014. [10].
7 Fair Work Act 2009 (Cth) s.789FD(1)(a).
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