FEDERAL COURT OF AUSTRALIA

Australasian Meat Industry Employees’ Union v Fair Work Australia (No 2) [2012] FCAFC 103

THE COURT ORDERS THAT:

1.    The plaintiff’s Application for an Order to Show Cause is dismissed.

2.    The second defendant’s application for costs is dismissed.

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

REASONS FOR JUDGMENT

Jessup and Tracey JJ

1    Consistently with the orders which we made in this proceeding on 8 June 2012 (Australasian Meat Industry Employees’ Union v Fair Work Australia [2012] FCAFC 85), the plaintiff and the second defendant have now filed submissions with respect to costs. The second defendant seeks its costs as the conventional entitlement of a party which has succeeded. The plaintiff resists that submission, and relies upon s 570 of the Fair Work Act 2009 (Cth) (“the FW Act”).

2    Section 570 of the FW Act provides as follows:

(1)    A party to proceedings (including an appeal) in a court (including a court of a State or Territory) exercising jurisdiction 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.

(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 FWA;

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

The second defendant does not suggest that subs (2) has any application in the circumstances, and ss 569 and 569A are irrelevant. The second defendant says, however, that the present proceeding was not one in which the court exercised jurisdiction under the FW Act and, accordingly, that s 570 has no application in the circumstances.

3    Section 570 is the last in a sequence of provisions which have restricted the availability of costs orders under Commonwealth industrial relations legislation. Relevantly to the present question, that sequence commenced with the introduction of s 197A into the Conciliation and Arbitration Act 1904 (Cth) in 1973. The provision, somewhat amended, became s 347 of the Industrial Relations Act 1988 (Cth) (“the IR Act”), and was retained as such (although again amended in a presently immaterial respect) when that act was renamed the Workplace Relations Act 1996 (Cth) (“the WR Act”) in 1996. As a result of renumbering effected by the Workplace Relations Amendment (Work Choices) Act 2005 (Cth), the provision became s 824 of the WR Act. When that Act was repealed upon the commencement of the FW Act, the provision was replaced by s 570, the terms of which are set out above.

4    In an important respect, s 570 of the FW Act departs from the formula by reference to which the relevant provision had operated since 1973. Traditionally, the limitation upon the award of costs had applied to a proceeding “in a matter arising under” the legislation concerned. As may be seen from the terms of s 570, that formula has now been abandoned, and the limitation applies “to proceedings … in a court … exercising jurisdiction under” the FW Act. That was a change deliberately made, and was explained in the relevant Explanatory Memorandum in 2008 as follows:

2229.    As noted above, the ‘matters arising’ language has been interpreted broadly. A proceeding not brought under the WR Act could still arise under the WR Act. The broad application of the costs provision has given rise to technical arguments that the provision does not apply in a range of proceedings not involving exercise of jurisdiction under the WR Act and its predecessors (see, e.g. Tristar Steering and Suspension v Industrial Relations Commission (NSW) (No 2) [2007] FCAFC 95; 159 FCR 274). Given the nature and complexity of ‘matters arising’ that are determined before State Supreme Courts, the Federal Court and the High Court, it is not appropriate that the limitation on costs orders apply to matters arising under the Bill which do not involve the exercise of jurisdiction under the Bill.

It is clear from this passage that the legislature was well aware that there might be proceedings in matters which arose under the FW Act which did not involve the exercise of jurisdiction under that Act, and that it intended to confine s 570 to proceedings which did.

5    Section 19(1) of the Federal Court of Australia Act 1976 (Cth) provides that the court has such original jurisdiction as is vested in it by laws made by the parliament. Sections 562 and 563 of the FW Act provide as follows:

562    Conferring jurisdiction on the Federal Court

Jurisdiction is conferred on the Federal Court in relation to any matter (whether civil or criminal) arising under this Act.

563 Exercising jurisdiction in the Fair Work Division of the Federal Court

The jurisdiction conferred on the Federal Court under section 562 is to be exercised in the Fair Work Division of the Federal Court if:

(a)    an application is made to the Federal Court under this Act; or

(b)    a writ of mandamus or prohibition or an injunction is sought in the Federal Court against a person holding office under this Act; or

(c)    a declaration is sought under section 21 of the Federal Court of Australia Act 1976 in relation to a matter arising under this Act; or

(d)    an injunction is sought under section 23 of the Federal Court of Australia Act 1976 in relation to a matter arising under this Act; or

(e)    a prosecution is instituted in the Federal Court under this Act; or

(f)    an appeal is instituted in the Federal Court from a judgment of the Federal Magistrates Court or a court of a State or Territory in a matter arising under this Act; or

(g)    proceedings in relation to a matter arising under this Act are transferred to the Federal Court from the Federal Magistrates Court; or

(h)    the Federal Magistrates Court or a court of a State or Territory states a case or reserves a question for the consideration of the Federal Court in a matter arising under this Act; or

(i)    the President refers, under section 608 of this Act, a question of law to the Federal Court; or

(j)    the High Court remits a matter arising under this Act to the Federal Court.

6    Under s 562, the court is given jurisdiction in relation to any matter arising under the FW Act. Jurisdiction so vested is jurisdiction “under this Act” for the purpose of s 570. To the extent that the operation of s 570 is tied to the exercise of jurisdiction vested by s 562, therefore, the ultimate question is whether the matter being dealt with arose under the FW Act. Or, to put it the other way round, the condition for the existence of jurisdiction under s 562 is that the matter in relation to which that jurisdiction would be exercised arose under the FW Act, and s 570 would apply to any such case.

7    The operation of ss 562 and 570 as explained above seems to be clear enough, but it does give rise to a certain tension with the object of changing the formula by reference to which the no-costs provision would operate, as expressed in the Explanatory Memorandum referred to above. Because of the wider range of courts covered by the embargo in s 570, this tension arises only in relation to the Federal Court itself, and it may be that this is the explanation for what otherwise seems to be a disconnect in legislative policy as between ss 562 and 570.

8    It is convenient next to consider whether, in the present case, the court was exercising the jurisdiction given by s 562 of the FW Act. The proceeding was in the original jurisdiction of the court, but it was not commenced in the court. Rather, it commenced as an application in the High Court for mandamus and other relief under s 75(v) of the Constitution. The proceeding was remitted to the court pursuant to s 44(1) of the Judiciary Act 1903 (Cth) which provides:

Any matter other than a matter to which subsection (2) applies that is at any time pending in the High Court, whether originally commenced in the High Court or not, or any part of such a matter, may, upon the application of a party or of the High Court’s own motion, be remitted by the High Court to any federal court, court of a State or court of a Territory that has jurisdiction with respect to the subject-matter and the parties, and, subject to any directions of the High Court, further proceedings in the matter or in that part of the matter, as the case may be, shall be as directed by the court to which it is remitted.

Section 44(1) provides for remitter to a court which “has jurisdiction with respect to the subject-matter and the parties” and was not, of itself, the source of the court’s jurisdiction to hear and determine the present proceeding. However, if the matter arose under the FW Act, jurisdiction would have existed for the purposes of s 44, to make the remitter effective.

9    Although s 563 of the FW Act does not confer jurisdiction, it reveals a clear legislative intention that, when a writ of mandamus is sought in the Federal Court against a person holding office under the FW Act (para (b)) and when the High Court remits a matter arising under the FW Act to the Federal Court (para (j)), the jurisdiction subsequently exercised is within that conferred under s 562. That is to say, assuming that the court does have jurisdiction in either such case, it is because the matter arises under the FW Act (and, of course, that requirement is explicit in the case of a remitted proceeding: s 563 (j)).

10    If the present question were to be resolved only by reference to the statutory provisions to which we have referred above, the acceptance of the court’s jurisdiction by the second defendant would seem to carry the inevitable consequence that s 570 applied to the proceeding. That is to say, it would now be too late for the second defendant to contend that the court did not have jurisdiction under s 562 on the basis that the matter did not arise under the Act. And if the jurisdiction being exercised by the court arose under s 562, the court was necessarily exercising jurisdiction under the FW Act for the purposes of s 570.

11    The provisions referred to above are not, however, the only ones to be considered. Another source of jurisdiction which was relevant to the present proceeding was that given under s 39B(1) of the Judiciary Act, which provides:

Subject to subsections (1B), (1C) and (1EA), the original jurisdiction of the Federal Court of Australia includes jurisdiction with respect to any matter in which a writ of mandamus or prohibition or an injunction is sought against an officer or officers of the Commonwealth.

Under this provision, the court had jurisdiction in the present case not because it involved a matter arising under the FW Act but because it involved a matter in which a writ of mandamus was sought against an officer of the Commonwealth.

12    The position, therefore, is that the court was invested with jurisdiction by s 39B(1) of the Judiciary Act, and also by s 562 of the FW Act, but only, in the case of the latter provision, if the matter was one which arose under the FW Act. If it was, then the court was exercising jurisdiction under the FW Act for the purposes of s 570, notwithstanding that it was also exercising jurisdiction under the Judiciary Act. The remaining question, then, is whether the matter which was before the court arose under the FW Act.

13    The plaintiff’s case was based upon the contention that the members of the majority of the Full Bench had, by applying an erroneous understanding of the relevant provisions of the FW Act, constructively failed to exercise their jurisdiction under s 505 of that Act. It sought orders that the Full Bench be required to decide the second defendant’s appeal from the Commissioner according to law, that is, according to the provisions of the FW Act.

14    In Re Polites (1991) 173 CLR 78 mandamus was sought, and ultimately granted, to require a member of the Industrial Relations Commission to hear a matter rather than, as he had, disqualify himself for apprehended bias. The successful prosecutor sought its costs, contending that the matter did not arise under the IR Act for the purposes of s 347 of that Act. That contention was rejected. The court said (173 CLR at 93):

The duties of a member of the Australian Industrial Relations Commission are created, expressly or impliedly, by the Act. When the President of the Commission, in exercise of his power to establish a Full Bench of the Commission (s. 30) appoints a member to sit as a member of a Full Bench to hear and determine an industrial dispute, Pt VI, Div. 2 of the Act imposes on that member a duty to hear and determine the industrial dispute as a member of the Full Bench accordingly. The order made in this case was an order to enforce that statutory duty. As the duty owes its existence to the Act, the controversy between the parties as to the enforcement of the duty is a matter arising under the Act. R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945), 70 C.L.R. 141, at p. 154; L.N.C. Industries Ltd. v. B.M.W. (Australia) Ltd. (1983), 151 C.L.R. 575, at p. 581; and see Poulos v. Waltons Stores (Interstate) Ltd. (1986), 68 A.L.R. 537, at p. 543; Thompson v. Hodder (1989), 21 F.C.R. 467, at p. 469.

15    By contrast, in Re McJannet (1997) 189 CLR 654 an order had been obtained prohibiting Judges of the Federal Court from giving effect to a decision which they had made in purported reliance on provisions of the IR Act. Distinguishing Re Polites, the court said (189 CLR at 656-657):

The test for determining whether a proceeding is in a matter arising under the Act for the purposes of s 347(1) is whether the right or the duty that is sought to be enforced owes its existence to a provision of the Act. That test follows from what was said with respect to s 76(ii) of the Constitution in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 154, where Latham CJ said:

[O]ne is compelled to the conclusion that a matter may properly be said to arise under a Federal law if the right or duty in question in the matter owes its existence to Federal law or depends upon Federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law. In either of these cases, the matter arises under the Federal law. If a right claimed is conferred by or under a Federal statute, the claim arises under the statute.

Ex parte Barrett is the root authority which was followed in Re Polites. In the present case, the proceeding before the Federal Court was in a matter arising under the Act because the respondents were claiming a right under the Act against the prosecutors. No order for costs could be made in respect of the proceeding in the Federal Court.

The proceeding in this Court, however, is of a different nature and the controversy between the parties is a different matter. In this Court, the prosecutors asserted the absence of a jurisdiction in the Federal Court to proceed further in the proceeding pending there. The jurisdiction of this Court which the prosecutors invoked is conferred by s 75(v) of the Constitution. The duty which was sought to be enforced was the duty not to assume a jurisdiction which the Federal Court did not have. Although the jurisdiction of this Court to issue mandamus in Re Polites, like the jurisdiction to issue prohibition in the present case, was conferred by s 75(v) of the Constitution, the proceeding in Re Polites answered the description of a matter arising under the Act within the meaning of s 347(1). But the proceeding in the present case does not. The relief which was sought by way of mandamus owed its form and content to the provisions of the Act which imposed the duty that the respondent was commanded to perform. The relief which is sought in an application for prohibition is not for the enforcement of any right or duty created or conferred by the Act. Accordingly, s 347(1) has no application to a proceeding for the issue by this Court of prohibition under s 75(v) of the Constitution.

16    The present case came within the class covered by the High Court’s ruling in Re Polites, in that the right or duty sought to be enforced owed its existence to provisions of the FW Act. Notwithstanding that the court had jurisdiction under s 39B(1) of the Judiciary Act, it also had jurisdiction under s 562 of the FW Act, on the basis that the matter before the court arose under that Act. It follows that s 570 applied in the circumstances.

17    Before concluding, we should refer to the recent judgment of the Full Court to which our attention was drawn, Construction, Forestry, Mining and Energy Union v CSBP Ltd (No 2) [2012] FCAFC 64, on which the second defendant relied. It was there held that s 570 had no application, because the court was exercising appellate jurisdiction under s 24(1)(a) of the Federal Court Act, not original jurisdiction vested by s 19 of that Act and s 562 of the FW Act. By contrast, in the present case the court was exercising its original jurisdiction, albeit that, by a direction given by the Chief Justice on 11 August 2011 pursuant to s 20(1A) of the Federal Court Act, it did so by a Full Court. The CSBP case does, therefore, have no relevance to the present question.

18    For the above reasons, we would dismiss the second defendant’s application for costs.

Associate:

Dated:    26 July 2012

REASONS FOR JUDGMENT

Flick J

19    On 8 June 2012 this Court published its reasons for decision in Australasian Meat Industry Employees’ Union v Fair Work Australia [2012] FCAFC 85.

20    The proceeding, it should be noted, had its origins in an Application for an Order to Show Cause filed in the High Court of Australia on 8 March 2011. That application sought a writ of certiorari quashing the orders of the Full Bench of Fair Work Australia made on 10 January 2011. A writ of mandamus was also sought directing the Full Bench to redetermine the matter in accordance with law. On 24 June 2011 a Justice of the High Court, Hayne J, remitted the proceeding to this Court pursuant to s 44 of the Judiciary Act 1903 (Cth).

21    On 11 August 2011, the Chief Justice of this Court made an order pursuant to s 20(1A) of the Federal Court of Australia Act 1976 (Cth) that the original jurisdiction of this Court be exercised by a Full Court. The proceeding was then heard and resolved by this Court constituted by three Judges.

22    The Plaintiff in the proceeding, the Australasian Meat Industry Employees’ Union (the Union), had initially applied to Fair Work Australia requesting that it “deal with a dispute” pursuant to s 505(1) of the Fair Work Act 2009 (Cth). The Union contended that a “request” made by the Second Defendant of an official of the Union to hold discussions with employees of the Second Defendant in a particular meeting room was not “reasonable”. A Commissioner held that the request was not “reasonable” but, on appeal, a Full Bench of Fair Work Australia concluded that it was “reasonable”. It was the Plaintiff’s challenge to that decision which was dismissed by this Court.

23    The parties had been given leave during the course of the hearing to file further submissions in respect to the appropriate order as to costs in the event that the Plaintiff’s application was dismissed.

24    The Plaintiff now resists an order that it pay the costs of the successful Second Defendant.

25    The power of this Court to make an order as to costs is contained in s 43(1) of the Federal Court of Australia Act which relevantly provides as follows:

Subject to … section 570 of the Fair Work Act 2009, the Court or a Judge has jurisdiction to award costs in all proceedings before the Court … other than proceedings in respect of which this or any other Act provides that costs shall not be awarded.

It is s 570 of the Fair Work Act upon which the Plaintiff now places reliance.

26    Section 570 relevantly provides as follows:

Costs only if proceedings instituted vexatiously etc.

(1)    A party to proceedings (including an appeal) in a court … exercising jurisdiction 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.

(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

…

Jurisdiction “under this Act” is relevantly conferred by s 562 which provides as follows:

Conferring jurisdiction on the Federal Court

Jurisdiction is conferred on the Federal Court in relation to any matter (whether civil or criminal) arising under this Act.

Section 563 also further relevantly provides as follows:

Exercising jurisdiction in the Fair Work Division of the Federal Court

The jurisdiction conferred on the Federal Court under section 562 is to be exercised in the Fair Work Division of the Federal Court if:

(a)    an application is made to the Federal Court under this Act; or

(b)    a writ of mandamus or prohibition or an injunction is sought in the Federal Court against a person holding office under this Act; or

(c)    a declaration is sought under section 21 of the Federal Court of Australia Act 1976 in relation to a matter arising under this Act; or

(d)    an injunction is sought under section 23 of the Federal Court of Australia Act 1976 in relation to a matter arising under this Act; or

(e)    a prosecution is instituted in the Federal Court under this Act; or

(f)    an appeal is instituted in the Federal Court from a judgment of the Federal Magistrates Court or a court of a State or Territory in a matter arising under this Act;

(g)    proceedings in relation to a matter arising under this Act are transferred to the Federal Court from the Federal Magistrates Court; or

(h)    the Federal Magistrates Court or a court of a State or Territory states a case or reserves a question for the consideration of the Federal Court in a matter arising under this Act; or

(i)    the President refers, under section 608 of this Act, a question of law to the Federal Court; or

(j)    the High Court remits a matter arising under this Act to the Federal Court.

But it is s 562, and not s 563, which confers jurisdiction on this Court. Section 563 “… simply provides that where jurisdiction is conferred on the Federal Court, that jurisdiction is to be exercised by the Fair Work Division of the Court”: Construction, Forestry, Mining and Energy Union v CSBP Ltd (No 2) [2012] FCAFC 64 at [14] per Keane CJ, Siopis and Rares JJ.

27    The principal question to be resolved is whether or not the “proceeding” in this Court was one in which the Court was “exercising jurisdiction under” the Fair Work Act – namely the jurisdiction conferred by s 562.

28    The proper construction of s 562 – and the phrase “in relation to any matter … arising under” the Fair Work Act – is to be resolved by reference to principles akin to determining whether there is a matter “arising under any laws made by the Parliament” for the purposes of s 76(ii) of the Constitution. Section 76(ii) provides that the Parliament may make laws conferring original jurisdiction on the High Court in any matter “arising under any laws made by the Parliament”. In that context it has been concluded that a matter arises under a Federal law if “… the right or duty in question in the matter owes its existence to Federal law or depends upon Federal law for its enforcement …”: R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 154 per Latham CJ. See also: Re Polites (1991) 173 CLR 78 at 93 per Brennan, Gaudron and McHugh JJ.

29    In resolving the Plaintiff’s Amended Application for an Order to Show Cause consideration had to be given to the manner in which the Union official sought to exercise the right of entry conferred by s 484 of the Fair Work Act and whether the request to use the meeting room as opposed to the lunchroom was a “reasonable request” within the meaning of and for the purposes of s 492(1) of that Act. Those competing positions were initially sought to be resolved by way of an application made to Fair Work Australia pursuant to s 505 of that Act, namely for Fair Work Australia to “deal with a dispute … about whether a request under section … 492 … is reasonable”. The right sought to be exercised by the Union official, and the right of the Second Defendant to make a “reasonable request”, were rights which owed their existence to ss 484 and 492.

30    The proceeding commenced in the High Court and remitted to this Court, however, only sought relief as against the Full Bench. No declaratory relief was also sought (for instance) as to whether the Second Defendant’s request was “reasonable”. The jurisdiction invoked by the Plaintiff when the proceeding was commenced in the High Court was exclusively that conferred by s 75(v) of the Constitution. Section 562 does not confer any jurisdiction on that Court. The same relief as the Plaintiff sought in the High Court could have been sought in this Court by reason of the jurisdiction conferred on this Court by s 39B of the Judiciary Act 1903 (Cth).

31    Once the “matter” was remitted to this Court pursuant to s 44 of the Judiciary Act, it is nevertheless concluded that the Court was exercising jurisdiction “in relation to … [a] matter … arising under” the Fair Work Act for the purposes of s 562 and that s 570(1) thus applies.

32    In reaching that conclusion it is considered that neither the form of the application as commenced nor the identity of a respondent as an “officer of the Commonwealth” is conclusive. Just as an intention to engage federal jurisdiction is not conclusive (Agtrack (NT) Pty Ltd v Hatfield [2005] HCA 38 at [32], 223 CLR 251 at 263 per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ), an intention to invoke the jurisdiction conferred on this Court pursuant to one particular statutory provision rather than another is not conclusive. Nor is the form of the relief which is sought conclusive. It is to be resolved as a “question of objective assessment”: cf. Agtrack at [32].

33    The jurisdiction exercised in the present proceeding is to be resolved by reference to whether or not the manner in which the competing rights of the Union official and the Second Defendant were resolved by the Full Bench can be said to be “in relation to any matter … arising under” the Fair Work Act for the purposes of s 562.

34    It is respectfully considered that no other characterisation can be given to the facts of the present case. Rights which are conferred by that Act were resolved by the Full Bench in the manner provided for by that Act. It was the Full Bench which discharged the power entrusted to it pursuant to s 505 to “deal with” the “dispute” between the Union official and the Second Defendant. The “dispute” had arisen because of the tension between the exercise of the right conferred by s 484 and that conferred by s 492. Both the “dispute” and the manner in which it was dealt with were all matters “arising under” the Fair Work Act.

35    It matters not that the Court could also have exercised jurisdiction – and may, indeed, have been concurrently exercising jurisdiction – pursuant to s 39B of the Judiciary Act. The terms of ss 562 and 570 of the Fair Work Act are not to be given any narrow construction or applied in a manner which denies parties the protection afforded by s 570(1) when the Court is resolving matters “arising under” the Fair Work Act.

36    The proceeding falls within s 570(1) and does not fall within s 570(2) or ss 569 or 569A.

37    The application for costs by the Second Defendant should thus be rejected.

Associate:

Dated:    26 July 2012