FEDERAL COURT OF AUSTRALIA

Australian Workers’ Union of Employees, Queensland v Etheridge Shire Council (No 2) [2009] FCA 58

COSTS – whether the usual order as to costs should be made – whether the matter was one to which the Workplace Relations Act applied – held that each proceeding was a matter arising under the Workplace Relations Act – held that the prohibition against the ordering of costs contained in s 824(1) of the Act applies in each the proceedings – held that the fact that each matter was something of a test case would not require a departure from the ordinary rule as to costs – no order as to costs made 

Federal Court of Australia Act 1976 (Cth) s 43

Workplace Relations Act 1996 (Cth) s 824

Australian Workers’ Union of Employees, Queensland and Others v Etheridge Shire Council and Another (2008) 171 FCR 102 – discussed

BGC Contracting v CFMEU (No 2) (2005) 143 FCR 409 – followed

R v Commonwealth Court of Conciliation and Arbitration; Ex Parte Barrett (1945) 70 CLR 141 – referred to

Re McJannet; Ex parte Australian Workers’ Union of Employees (Q) [No 2] (19970 189 CLR 654 – cited

Tristar Steering and Suspension Australia Ltd v Industrial Relations Commissioner of New South Wales (2007) 159 FCR 274 - cited

THE AUSTRALIAN WORKERS' UNION OF EMPLOYEES, QUEENSLAND and QUEENSLAND SERVICES, INDUSTRIAL UNION OF EMPLOYEES v ETHERIDGE SHIRE COUNCIL, WORKPLACE AUTHORITY DIRECTOR and STATE OF QUEENSLAND (Intervener)

QUD 481 of 2006

STATE OF QUEENSLAND v ETHERIDGE SHIRE COUNCIL and WORKPLACE AUTHORITY DIRECTOR

QUD 39 OF 2007

SPENDER  J

6 FEBRUARY 2009

BRISBANE

THE COURT ORDERS THAT:

1.                  There be no order as to costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

THE COURT ORDERS THAT:

1.         There be no order as to costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

.

REASONS FOR JUDGMENT

1                     These reasons concern the question of costs in each of the principal proceedings.  As it turns out, there is a significant question of statutory interpretation as to what is a “matter arising under the Workplace Relations Act 1996 (Cth) (the Workplace Relations Act)” that is central to any award of costs in each of the proceedings.

2                     On 20 August 2008, I delivered judgment in both of these matters, finding for the applicants in each case: Australian Workers’ Union of Employees, Queensland and Others v Etheridge Shire Council and Another (2008) 171 FCR 102; (2008) 250 ALR 485; and (2008) 175 IR 383.  At that time, I indicated that I would hear the parties as to costs in the matters.

3                     In proceedings QUD 481 of 2006, the applicants filed a submission on costs on 27 August 2008.  On 3 September 2008, the first respondent filed submissions on costs, and on 5 September 2008, the applicants filed a submission in reply.

4                     In proceedings QUD 39 of 2007, the applicant filed submissions on costs on 27 August 2008, and on 3 September 2008, the first respondent filed submissions on costs.  Those submissions were the same as had been filed in the other proceedings.

Proceedings QUD 481 of 2006

5                     The applicants in these proceedings seek an order that the first respondent pay their costs of the proceeding, to be taxed if not agreed.

6                     In these proceedings, the applicants sought various declarations from the Court.  The interest of each applicant was the same, and both were represented by the same counsel.  The applicants were wholly successful, the Court granting the relief which they sought.  The applicants submit that there is no special reason for the Court to depart from the ordinary rule that costs follow the event, and, accordingly, the first respondent should pay the applicants’ costs.

7                     Further, the applicants submit that they attempted to resolve the matter without litigation, but the parties were unable to reach agreement, the first respondent not accepting the correctness of propositions put by the applicants that the Etheridge Shire Council was not a “constitutional corporation” and therefore could not lodge the relevant workplace agreement.  The applicants contend they were therefore forced to commence litigation in respect of which they were wholly successful, and which the respondents vigorously, but unsuccessfully, defended.

8                     The first respondent seeks to avoid the “usual order as to costs” on two bases.

9                     The first relies on s 824 of the Workplace Relations Act which provides:

824      Costs only where proceeding instituted vexatiously etc.

(1)        A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) must 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)        Despite subsection (1), if a court hearing a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 663) is satisfied that a party to the proceeding has, by an unreasonable act or omission, caused another party to the proceeding to incur costs in connection with the proceeding, the court may order the first-mentioned party to pay some or all of those costs.

(3)        In subsections (1) and (2):

            costs includes all legal and professional costs and disbursements and expenses of witnesses.

10                  The second basis on which the first respondent argues that no costs order should be made is because the matter was a “test case”, being, so the first respondent argues, a vehicle to test the proposition that local governments were constitutional corporations.  In this respect the first respondent draws attention to the comments of Kirby J in Oshlack v Richmond Shire Council (1998) 193 CLR 72 that where a matter is a test case, the Court may exercise its discretion to refrain from following the usual principle that costs follow the event.

QUD 39 of 2007

11                  The applicant in this proceeding submits that costs should follow the event and the first respondent should be ordered to pay the costs of the applicant in those proceedings. 

12                  The first respondent in this proceeding makes the same submissions as it did in QUD 481 of 2006, but argues, in addition, that the reliance by the State of Queensland on the judgment in Tristar Steering and Suspension Australia Ltd v Industrial Relations Commissioner of New South Wales (2007) 159 FCR 274 is distinguishable, it being said that that matter involved the invocation of s 109 of the Australian Constitution in the determination as to costs.

QUD 481 of 2006 & QUD 39 of 2007

13                  In each proceeding, s 43 of the Federal Court of Australia Act 1976 (Cth) is the basis for any order as to costs:

(1)        … the Court or a Judge has jurisdiction to award costs in all proceedings before the Court (including proceedings dismissed for want of jurisdiction) other than proceedings in respect of which any other Act provides that costs shall not be awarded.

            …

(2)        Except as provided by any other Act, the award of costs is in the discretion of the Court or Judge.

14                  The first respondent submitted in each proceeding that it ought not to be ordered to pay costs because each proceeding was “a matter arising under the [Workplace Relations] Act” and therefore the specific exemption provided in s 824(1) applied.

15                  That submission is determined by whether each of these proceedings is a matter arising under the Workplace Relations Act. 

16                  The applicant in each proceeding submits that that proceeding is not a proceeding “arising under” the Workplace Relations Actand that therefore s 824 has no application.  Each of the applicants relies on Re McJannet; Ex parte Australian Workers’ Union of Employees (Q)[No 2] (1997) 189 CLR 654 (McJannet), which, the applicants assert, contains the relevant test.  The High Court in McJannet said, at 656, that the test was “whether the right or the  duty that is sought to be enforced owes its existence to a provision of the Act.”   The applicants submit that, as they sought declarations to the effect that the first respondent had no right under the Workplace Relations Act, to act as it did, s 824 has no application.  The applicants do not address the contention by the first respondent in each proceeding, that the first respondent had a right pursuant to the Workplace Relations Act to enter into a Workplace Agreement with its employees, and register it pursuant to the Workplace Relations Act.

17                  The Etheridge Shire Council argues that it had asserted that it was “an employer” within the meaning of the Workplace Relations Act and was therefore entitled to register a Workplace Agreement with its employees pursuant to that Act.  It was the denial of that asserted right by the respective applicants that led to the proceedings being instituted.  The Etheridge Shire Council argues that a party need not, in the end result, be successful concerning a claim advanced by it, provided the claim advanced by it, or on which it relies, is a claim to a right that owes its existence to the provision of Workplace Relations Act.

18                  The Etheridge Shire Council refers, in particular, to the decision of French J (as he then was) in BGC Contracting v CFMEU (No 2) (2005) 143 FCR 409 (BGC Contracting), where his Honour found that s 824 applied. 

19                  In BGC Contracting, the applicant instituted proceedings seeking declarations that representatives of the CFMEU, a state registered union, had no right under the Industrial Relations Act 1979 (WA) (the IRA) to enter a construction site for an ammonia plant in Western Australia.  The basis for that application was that the workers at the site were employed under Australian Workplace Agreements made under the Workplace Relations Act.  Rights of entry created by that Act in respect of those employees were said to be inconsistent with the IRA, and therefore rendered inoperative the rights of entry conferred under the IRA, in so far as they purported to apply to the construction site.

20                  The application was dismissed and the CFMEU sought an order for costs, which was opposed by the applicants and the Minister.  The respondents contended that the proceedings were proceedings in a matter arising under the Workplace Relations Act and that the then      s 347 of the Workplace Relations Act confined the power to award costs to circumstances in which the proceedings had been instituted frivolously or vexatiously.  French J concluded that the proceedings were proceedings in a matter arising under the Workplace Relations Act, and, for that reason, no order for costs should be made.

21                  In addition to McJannet, Etheridge Shire Council also noted R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141, where Latham CJ said at 154, “If a right claimed is conferred by or under a Federal statue, the claim arises under the statute.”   

22                  The applicants seek to distinguish the BGC Contracting case submitting that:

In BGC Contracting, the rights sought to be invoked were rights conferred upon an employer bound by that Act, in respect of employees who were undoubtedly the subject of regulation by that Act, by reason of the existence of AWAs lawfully made under that Act.

23                  That matter was, so the applicants submit, clearly one to which the Workplace Relations Act applied.  In this case, however, the applicants argue the Workplace Relations Act had no application to the first respondent at all, and the matter did not, therefore, arise under the Act.

24                  The answer to these questions, in my judgment, relies on a precise identification of the “matter” in the present case.  “Matter” in that sense, means the judicial controversy between the parties. 

25                  The applicants asserted that the Etheridge Shire Council was not  a constitutional corporation, and was therefore not an “employer” under the Workplace Relations Act, and was therefore not entitled to register a Workplace Agreement with its employees pursuant to the Workplace Relations Act. 

26                  In my judgment, each proceeding was a “matter arising under the Workplace Relations Act”. The Etheridge Shire Council asserted that it was an “employer” under the Workplace Relations Act, being a constitutional corporation and therefore was entitled to register the Workplace Agreement, pursuant to the Workplace Relations Act. The right claimed by the Etheridge Shire Council, and denied by the respective applicants, was a right conferred by an order of the Workplace Relations Act, and therefore arose under that Act.   It follows that the prohibition against the ordering of costs contained in s 824(1) applies in each of the present proceedings.

27                  It does not affect my conclusion that the exception referred to in s 824(1) is directed at the “institution” of proceedings.  The Etheridge Shire Council did not institute either proceeding.  It therefore follows that it could not have instituted either proceeding vexatiously, or have instituted either proceeding without reasonable cause.  As a respondent in each proceeding, it has an immunity from an order to pay costs, if either proceeding was a matter arising the Workplace Relations Act.  In my opinion, each proceeding was such a matter.  That conclusion is consistent, in my view, with the conclusion and reasoning of French J in the BGC Contracting case.

28                  That is sufficient to dispose of the application for costs. 

29                  For completeness, were my conclusion to be contrary to that expressed above, the contention that each matter was something of a “test” case, would not be a basis on which I would refrain from following the usual principle that costs follow the event.

30                  In proceedings QUD 481 of 2006, the State of Queensland intervened.  For that reason also, I would not award costs to the State of Queensland in that proceeding.  To do so would, in my opinion, go some way towards circumventing the operation of s 78A of the Judiciary Act 1903 (Cth).

Associate:

Dated:         6 February 2009

QUD 481 of 2006