FEDERAL COURT OF AUSTRALIA

Jordan v Aerial Taxi Cabs Co-Operative Society Ltd (No. 2) [2001] FCA 1272

COSTS – principal proceedings involving claims under Workplace Relations Act 1996 (Cth) (“the WRA”) and the Trade Practices Act 1974 (Cth) (“the TPA”) unsuccessful – WRA prohibits costs awards in proceedings under WRA unless instituted vexatiously or without reasonable cause – whether costs should be awarded in proceedings invoking the WRA and another Act – both causes of action need to be shown to be vexatious or instituted without reasonable cause.

words & Phrases – “matter”

Workplace Relations Act 1996 (Cth), s 347

Fencott v Muller (1983) 152 CLR 570, referred to

Philip Morris Incorporated v Adam P. Brown Male Fashions Pty Ltd (1981) 148 CLR 457, cited

Thompson v Hodder (1990) 21 FCR 467, applied

Maritime Union of Australia v Geraldton Port Authority (No 2) (2000) 94 IR 404, followed

Lee v Aerial Taxi Cabs Co-Operative Society Ltd [2000] FCA 157, cited

Hatchett v Bowater Tutt Industries Pty Ltd (1991) 28 FCR 324, followed

Lee v Aerial Taxi Cabs Co-Operative Society Ltd [1999] FCA 1727, referred to

R v Moore; Ex parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470, cited

DOUGLAS JORDAN v AERIAL TAXI CABS CO-OPERATIVE SOCIETY LTD

(No. 2)

A7 of 1999

MADGWICK J

6 SEPTEMBER 2001

SYDNEY

REASONS FOR JUDGMENT

HIS HONOUR:

1                     In the principal proceedings, the applicant’s application and amended Statement of Claim invoked s 127A of the Workplace Relations Act 1996 (Cth) (“the WRA”) and s 46 of the Trade Practices Act 1974 (Cth) (“the TPA”).  I rejected both of these claims:  see Jordan v Aerial Taxi Cabs Co-Operative Society Ltd [2001] FCA 972.  The respondent seeks costs. 

2                     Section 347 of the WRA provides:

“(1)     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.

(2)       In subsection (1):

            "costs" includes all legal and professional costs and disbursements and expenses of witnesses.” (emphasis added)

3                     The respondent submitted that, insofar as the proceedings could be regarded as “arising under” the WRA, they were instituted without reasonable cause.  Insofar as they were not (and that is at least to the extent of 50%, since there were two causes of action), the applicant should pay the respondent’s costs in the ordinary way.

4                     The principal question is whether the proceedings in their entirety including both the WRA and TPA claim can be considered as a matter arising under the WRA.  There is a large body of judicial authority as to the meaning of “matter”, primarily in the context of Ch III of the Constitution.  In Fencott v Muller (1983) 152 CLR 570 at 606, the majority said of the various judgments of the High Court in Philip Morris Incorporated v Adam P. Brown Male Fashions Pty Ltd (1981) 148 CLR 457:

“The majority view was that a ‘matter’ is a justiciable controversy which must be either constituted by or must include a claim arising under a federal law but which may also include another cause of action arising under another law, provided it is attached to and is not severable from the former claim. … It follows that the ambit of a matter arising under a federal law may extend beyond claims which arise under that law or which are to be determined by reference to that law alone.”

The majority in Fencott went on to say (at 608):

“it would be erroneous to exclude a substantial part of what is in truth a single justiciable controversy and thereby to preclude the exercise of judicial power to determine the whole of that controversy.”

5                     In Thompson v Hodder (1990) 21 FCR 467, a Full Court of this Court dealing with s 347 said (at 471):

“in light of the authorities relating to the word ‘matter’, we doubt whether the Court should seek to discern within a single ‘proceeding’ those elements which might have been brought otherwise than in a matter arising under the Act, for the purpose of attaching an order for costs to those elements.  Provided that they are elements of the single justiciable controversy, in which the provisions of the Act are called in aid, by way of claim or defence, it may be said that they are in a matter arising under the Act.”

6                     More recently, in Maritime Union of Australia v Geraldton Port Authority (No 2) (2000) 94 IR 404, RD Nicholson J dealt with a claim under the WRA and a cause of action based on the tort of conspiracy.  His Honour took the view that the authorities in this Court establish that, for the purposes of s 347, the severance of different causes of action in a proceeding, invoking the WRA, is not possible:  see p 419 and the authorities there cited.

7                     In Lee v Aerial Taxi Cabs Co-Operative Society Ltd [2000] FCA 157, where there was also a WRA cause of action along with another cause of action, Gyles J ordered an unsuccessful party to pay half the costs.  Whether his Honour was referred to Thompson and the other authorities is not clear.  In any case, his Honour did not give any reasons as to his costs order.

8                     The authorities clearly indicate that a “matter” is to be given a broad interpretation and is to be approached from an examination of the facts giving rise to the conflict between the parties.  Whether in the context of the Constitution or the WRA, if a cause of action invokes a federal law or the WRA as well as other laws bona fide asserted to be applicable to the facts giving rise to the justiciable controversy before the Court, there is a single matter.  The judicial justification for such a broad interpretation of “matter” is that, it is in the interests of the efficient and speedy administration of justice that there be no impediment to all proceedings arising from one justiciable controversy being dealt with together.

9                     In the present case, both causes of action related to the one set of facts.  The justiciable controversy arose from the drivers’ agreement that the applicant entered into with the respondent.  It was this contract that was alleged to be in breach of s 127A of the WRA and it was as a result of this agreement that the applicant bound himself to accept the respondent’s rules and by-laws allowing him to be disciplined in a manner alleged to be a breach of the TPA.  The majority of the hearing time was spent on the WRA claim rather then the TPA cause of action.  It could not be said that the WRA aspect of the proceedings was any mere side-wind.  Therefore, in my opinion, as indicated by the authorities, the entire proceedings were a matter arising under the WRA.  The applicant therefore gets the benefit of s 347 subject to the qualifications there provided.

10                  It follows that, as to both causes of action sued upon, it must be proven that the proceedings were instituted without reasonable cause, before the discretion to award costs is enlivened (there is no question here of vexatious litigation).  Even where that can be shown to be the case, the Court’s exercise of its discretion not to award costs may be informed by “the general policy of the Act, expressed in s 347”:  Hatchett v Bowater Tutt Industries Pty Ltd (1991) 28 FCR 324 at 326 per von Doussa J.

11                  In the principal proceedings, I found the applicant’s claims to be misconceived, having regard to the statutory elements of each of the two causes of action sued upon.  One cause of action sought to apply s 46 of the TPA in a novel situation.  Ex hypothesi, there was no authority to point the way.  In the other, there was the decision of Gyles J in Lee v Aerial Taxi Cabs Co-Operative Society Ltd [1999] FCA 1727which dismissed a claim based on s 127A of the WRA out of hand, although without giving detailed reasons on the issue primarily argued in the proceedings before me.  It is true that those who stand behind the applicant could have seen to it that that aspect of Gyles J’s decision in Lee was appealed, but did not do so, before asserting an indistinguishable cause of action in the present proceedings.  However, it is not necessarily unreasonable of a litigant not to appeal from one judge’s adverse decision on a legal question before re-arguing that question in a different case before another judge.  Nor does a failure to appeal operate as an implied admission that the litigant regards the point as not arguable.  A fortiori where there are different litigants, albeit with a common source of support.

12                  I do not regard the proceedings as having been instituted without reasonable cause.  A seriously-felt, claimed unfairness in the absence of driver representation in the respondent’s disciplinary councils and an arguable workplace grievance – inadequacy of compensation for wearing and supplying uniforms, etc, occurring in a situation where taxi-drivers may well feel and be seen to be quasi-employees – underlay the proceedings.  Causes of action that may have looked promising and arguable to counsel were rejected by a judge.  Something considerably more than this is needed to show lack of reasonable cause to institute the proceeding:  see R v Moore; Ex parte Federated Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470 per Gibbs J at 473.

13                  In any case, if I am empowered to award costs, I would decline to do so.  I agree with the approach of von Doussa J in Hatchett.  The “general policy” underlying the Act is to encourage the resolution of industrial disputes and differences and, by reason of s 127A, quasi-industrial disputes and differences, by the administrative or curial processes provided by the Act.  Having regard to that policy, I think that the circumstances are not such as to require or make appropriate application of rules about costs, drawn from other kinds of litigation in other settings.

14                  Accordingly, there will be no order as to costs.

Associate:

Dated:              6 September 2001