FEDERAL COURT OF AUSTRALIA

Technical and Further Education Commission v Pykett [2015] FCAFC 42

THE COURT ORDERS THAT:

1.    The first respondent’s application for costs be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

The Court:

1    At the conclusion of the hearing on 23 February 2015 the Full Court dismissed an application for constitutional relief brought by Technical and Further Education Commission (‘TAFE’) and indicated that it would publish reasons in due course. Subsequently, the parties filed submissions on the question of costs. These reasons deal with those two issues.

Dismissal of the Proceedings

2    The proceedings were dismissed because they had become moot. They had become moot because events occurring two weeks prior to the hearing meant that the argument between the parties no longer mattered.

3    Mrs Pykett had been employed by TAFE as a Technical Officer 1/2, Scientific until her employment was terminated, on grounds of redundancy, on 26 October 2012. She applied to the Fair Work Commission for reinstatement which, on 16 June 2014, it ordered. It did so under the Fair Work Act 2009 (Cth). It also ordered that her period of employment not be treated as having been broken by the dismissal it had set aside. It ordered TAFE to pay Ms Pykett $40,592.74 in foregone remuneration.

4    TAFE does not consider that the Fair Work Commission has constitutional authority to order it to reinstate Ms Pykett. It says that it is critical to the capacity of the State of New South Wales to function as a government that it be able to determine the number and identity of the persons it wishes to employ. Consequently, it contends that federal legislation requiring it to reappoint an employee whom it no longer desires to employ infringes the principle in Melbourne Corporation v Commonwealth (1947) 74 CLR 31 and is invalid. In this regard, it particularly relies upon a passage in Re Australian Education Union; ex parte Victoria (1995) 184 CLR 188 at 232.

5    On the basis of that principle TAFE commenced proceedings in this Court’s original jurisdiction contending that the Commission’s reinstatement order was constitutionally invalid. Plainly, this is a question of considerable significance to State governments. In effect, the issue is whether State governments, as employers, are caught up in the federal regime for reinstatement under the provisions of the Fair Work Act or whether hiring and firing decisions by State governments are beyond federal control. Although the matter was initially assigned to a single judge of the Court, on 9 October 2014, the Chief Justice determined that it should be heard by a Full Court.

6    After the Fair Work Commission ordered Ms Pykett’s re-engagement, TAFE reappointed her after a short delay. In December 2014, whilst the matter was pending in this Court, TAFE introduced a limited voluntary redundancy program at Ms Pykett’s new work location. Ms Pykett did not indicate to TAFE that she was interested in accepting voluntary redundancy. In the course of implementing its new organisational structure, TAFE directly appointed her to the permanent position of Technical Officer Scientific effective from 11 February 2015. That was twelve days before the hearing in this Court.

7    That appointment has rendered the question of whether this Court should set aside the Fair Work Commission’s earlier decision that Ms Pykett should be reinstated somewhat academic. In this proceeding, TAFE seeks orders setting aside the Fair Work Commission’s orders for reinstatement, together with other declaratory relief. Subject to two matters, neither form of relief would have any on-going utility. If the reinstatement orders were set aside it would be meaningless because of its recent decision to employ her in a new position. Further, the proposed declaratory relief is merely ancillary.

8    There are, in fact, only two ways the proceeding might now give rise to a justiciable controversy. The first is that it is possible, if the reinstatement orders are set aside, that TAFE could seek restitution of the monies it has paid under the orders of the Fair Work Commission in accordance with the principle in Commonwealth v McCormack (1984) 155 CLR 273 at 276 (‘Restitutio in integrum is the right of every successful appellant’). The second is that it might seek to cavil with the notion that Ms Pykett should be treated as not ever having been dismissed. This might, for example, be relevant to issues such as seniority and so on. Both of these arguments could be coherently pursued despite Ms Pykett now having her new position. Either would give the case practical import.

9    When the matter was called on for hearing on Monday 23 February 2015 before this Court, the learned Solicitor-General for New South Wales, who appeared for TAFE, indicated that these were academic considerations and that neither would be pursued. Inevitably, this has the consequence that the proceeding no longer contains any justiciable dispute which this Court can resolve.

10    Authority establishes the inability of courts exercising federal jurisdiction to resolve constitutional questions which are hypothetical or which do not arise (In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 266-267) or which are not necessary for the disposition of a suit (Attorney-General for NSW v Brewery Employees Union of NSW (1908) 6 CLR 469 at 590). The continuing vitality of that principle of restraint, which pays due respect to the fact that statute law is the result of a democratic process not lightly to be thwarted, has recently been affirmed: Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 372 [148]; CPCF v Minister for Immigration and Border Protection (2015) 316 ALR 1 at 74-75 [335] per Gageler J. It controls this case and requires its dismissal on mootness grounds.

11    It was for these reasons that the Court dismissed the proceeding on the day of the hearing, 23 February 2015.

Costs

12    Section 570 of the Fair Work Act provides:

Costs only if proceedings instituted vexatiously etc.

(1)    A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A.

Note:    The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 569A.

(2)    The party may be ordered to pay the costs only if:

(a)    the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or

(b)    the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs; or

(c)    the court is satisfied of both of the following:

(i)    the party unreasonably refused to participate in a matter before the FWC;

(ii)    the matter arose from the same facts as the proceedings.

13    Ms Pykett seeks an order that TAFE now pay her costs on and from 10 February 2015, the day the case became moot. She accepted that she was obliged to overcome the limitations in s 570(2)(b), that is to say, to satisfy the Court that she was caused to incur costs by TAFE’s ‘unreasonable act or omission’. In doing so, she accepted that the proceeding before this Court answered the description of being a proceeding ‘in relation to a matter arising under this Act’. TAFE agreed with Ms Pykett’s view, which it said was supported by the Full Court’s recent decision in Melbourne Stadiums Ltd v Sautner [2015] FCAFC 20 at [156]-[157]. That case does not, however, address the situation where, as here, it is alleged that the Fair Work Act did not authorise the decision of the Commission which was made. We would leave for another day, therefore, the question of whether proceedings under the Judiciary Act 1903 (Cth) for certiorari and prohibition in relation to orders said to be ultra vires the Fair Work Act can by themselves be said to be an action arising under the Fair Work Act.

14    Whether s 570 applies or not we would not be disposed to order costs against TAFE. As we have explained above, the proceedings did not immediately become moot but continued to have relevance until TAFE decided whether it would seek to recover the money it had paid her. It was not bound to make up its mind about this immediately. Further, it is easy to understand from the State’s perspective what an important question was raised by the case and the need, if at all possible, to keep the issue alive in order to allow its resolution. We do not think in that circumstance that the 12 days TAFE took to decide it was not going to move against Ms Pykett for the recovery of money was unreasonable. A dramatic factual development rendered the case pointless shortly before it was to be heard. TAFE was not bound to respond to this development immediately. From time to time in litigation, blameless events like this occur. There should be no order as to costs.

Associate:

Dated:    23 March 2015