FEDERAL COURT OF AUSTRALIA

Spotless Services Australia Ltd v The Honourable Senior Deputy President Jeanette Marsh [2004] FCAFC 155

INDUSTRIAL LAW – application for costs order – whether s 347(1) of the Workplace Relations Act 1996 (Cth) applies to preclude the award of costs – proceeding instituted without reasonable cause – costs order made

Workplace Relations Act 1996 (Cth) s 347(1)

Re McJannet; ex parte Australian Workers’ Union of Employees, Queensland (1997) 189 CLR 654 at 656, applied

Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257 at 264-265, referred to

Thompson v Hodder (1989) 21 FCR 467 at 470, referred to

SPOTLESS SERVICES AUSTRALIA LTD v THE HONOURABLE SENIOR DEPUTY PRESIDENT JEANETTE MARSH, THE HONOURABLE DEPUTY PRESIDENT NICHOLAS BLAIN and COMMISSIONER BARBARA DEEGAN AS MEMBERS OF A FULL BENCH OF THE AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION and THE HONOURABLE BRENDAN McCARTHY, A DEPUTY PRESIDENT OF THE COMMISSION and MARION WOOKEY and TERRY TOPHAM

W 225 OF 2003

WILCOX, MARSHALL and JACOBSON JJ

9 JUNE 2004

MELBOURNE (HEARD IN PERTH)

ON REMITTAL FROM THE HIGH COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1. The applicant pay the second respondents’ costs of its application for constitutional writs both in this Court and the High Court of Australia.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

ON REMITTAL FROM THE HIGH COURT OF AUSTRALIA

REASONS FOR JUDGMENT

         THE COURT

1                     On 19 May 2004, the Court refused the applicant (“Spotless”) an order nisi for the following relief:

·        a writ of certiorari directed to members of the Australian Industrial Relations Commission (“the Commission”) to quash orders of a Full Bench and of a Deputy President; and

·        a writ of mandamus to compel a Deputy President to hear a motion

2                     After hearing the submissions of counsel for Spotless, the Court decided that it did not need to hear from counsel for the second respondents.  Shortly thereafter, it delivered its ex-tempore reasons for judgment: Spotless Services Australia Ltd v The Honourable Senior Deputy President Jeanette Marsh [2004] FCAFC 136 (“the substantive judgment”).

3                     The Court permitted the parties to present written submissions as to costs.

4                     The second respondents submitted that there should be an order for costs in their favour.  They noted the presence in the Workplace Relations Act 1996 (Cth) (“the Act”) of s 347(1), but contended that it was inapplicable to the instant case.

5                     Section 347(1) provides:

“A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 170CP) shall not be ordered to pay costs incurred by any other party to the proceeding unless the first-mentioned party instituted the proceeding vexatiously or without reasonable cause”.

6                     Counsel for the second respondents, Mr R.L.Hooker, submitted that s 347(1) is inapplicable because the proceeding before the Court was not “in a matter arising under [the] Act”.  Alternatively he contended that Spotless sought the issue of an order nisi without reasonable cause.

7                     Whether a proceeding is in a matter arising under the Act depends on whether the right or duty that is sought to be enforced owes its existence to a provision of the Act: Re McJannet; ex parte Australian Workers’ Union of Employees, Queensland (1997) 189 CLR 654 at 656.

8                     It is noteworthy that Spotless did not seek a writ of prohibition. In this matter the duty sought to be enforced was an alleged duty of the Deputy President to deal with a motion under s 170CE(7). No such duty existed because a conciliation certificate had been issued before the motion was filed.  However, that fact does not mean that the alleged duty sought to be enforced did not owe its existence to a provision of the Act, namely, s 170CE(7).  Accordingly, s 347(1) applies to this matter.

9                     At [28] of the substantive judgment, the Court described the application for an order nisi as devoid of merit.  We did not make that observation lightly.  In our view, at the time the draft order nisi was presented to the High Court, it should have been apparent to those advising Spotless that the application had no substantial prospect of success.

10                  The success of the application did not depend upon the determination of disputed facts or the resolution in favour of Spotless of any arguable point of law: see Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257 at 264-265.  Rather, on the face of the draft order nisi, it was clear that an order nisi would have to be refused for the reasons referred to in the substantive judgment.

11                  It follows that the Court has power to order costs against Spotless.  We see no reason why such an order should not be made.  The second respondents were put to the trouble and expense of defending an application which had no prospect of success and disclosed no arguable basis for relief.

12                  Spotless, in its written submissions, referred the Court to Thompson v Hodder (1989) 21 FCR 467, in support of the proposition that exceptional circumstances must be demonstrated before an order for costs can be made under s 347 and that the onus lies on the successful parties to make out their case for costs.  That submission stemmed from the observation of the Full Court at p. 470 in Thompson, where, after referring to two authorities, it said:

“…an applicant who has the benefit of the protection of s 347 will only rarely be ordered to pay the costs of a proceeding in exceptional circumstances”.

13                  The usual course is that, in matters arising under the Act, there will be no order as to costs.  To that extent a costs order is an exceptional order.  However, there is no warrant for applying “an exceptional circumstances test” to consider whether a proceeding has been commenced without reasonable cause.  Whether a proceeding has been commenced without reasonable cause is relevantly established as a matter of objective fact.

14                  In Thompson, the Full Court made a costs order against the unsuccessful applicant.  It considered that the application for leave to appeal was bound to fail.  Consequently it considered that the proceeding was instituted without reasonable cause.  We take the same view of Spotless’ application for prerogative relief in this matter.

15                  It is of no assistance to Spotless to attempt to demonstrate the alleged complexity of issues arising in the proceeding by reference to the views of the first respondents or to the length of the decision of the Full Bench.  Whether the appeal before the Full Bench was filed without reasonable cause is not a matter that it was required to consider.  It is also not a matter germane to whether the application for an order nisi was made without reasonable cause.

16                  We will order, in addition to the orders accompanying the substantive judgment, as follows:

“The applicant pay the second respondents’ costs of its application for constitutional writs both in this Court and the High Court of Australia”.

Associate:

Dated:              9 June 2004