FEDERAL COURT OF AUSTRALIA

Construction, Forestry, Mining and Energy Union v Gittany [2014] FCA 164

FEDERAL COURT OF AUSTRALIA

Construction, Forestry, Mining and Energy Union v Gittany [2014] FCA 164

CORRIGENDUM

1.    In paragraph 56 of the Reasons for Judgment, delete the words ‘with costs’.

Associate:

Dated:    12 March 2014

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    Unless an application is made for costs within 14 days of the date of this order, there be no order as to the costs of the appeal.

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

REASONS FOR JUDGMENT

1    The appellant (‘the CFMEU’) appeals two decisions of the Federal Circuit Court of Australia (‘FCCA’). The first decision dismissed four claims made by the CFMEU: see Construction, Forestry, Mining and Energy Union v Hume Highway Constructions Pty Limited & Anor [2013] FMCA 154 (‘the first judgment’). The first and second claims alleged that Hume Highway Constructions Pty Limited (‘Hume Highway’), and the respondent, Anthony Gittany (‘Mr Gittany’), each contravened s 501 of the Fair Work Act 2009 (Cth) (‘the FW Act’) by prohibiting entry to three CFMEU representatives to a construction site controlled by Hume Highway. The third and fourth claims alleged that Hume Highway and Mr Gittany each breached s 502 of the FW Act by hindering or obstructing the same representatives from entering the site.

2    The second decision was confined to the determination of the costs of the liability proceedings. The primary judge found that the proceedings had been commenced without reasonable cause and, inter alia, ordered that the CFMEU pay one half of the costs of both respondents: see Construction, Forestry, Mining and Energy Union v Hume Highway Constructions Pty Limited & Anor (No 2) [2013] FCCA 215 (‘the second judgment’).

3    Hume Highway is now in liquidation. As a result, the CFMEU only seeks relief on this appeal against Mr Gittany. The grounds of appeal relied upon by the CFMEU in its further amended notice of appeal may be separated into three categories, namely that the primary judge erred in his findings regarding:

a)    the alleged contravention of s 502 of the FW Act;

b)    the alleged contravention of s 501 of the FW Act; and

c)    the costs awarded in the second judgment.

FACTS

4    At about 8.00 am on 6 December 2011, whilst Hume Highway was undertaking construction work at a site known as 580 Hume Highway, Yagoona (‘the premises’), three state organisers of the NSW State Branch of the CFMEU, namely Brian Miller (‘Mr Miller’), Chikmann Koh (‘Mr Koh’) and Mansour Razaghi (‘Mr Razaghi’) (collectively referred to as ‘the CFMEU representatives’), entered upon the construction site for the purpose of investigating possible breaches of the Occupational Health and Safety Act 2000 (NSW) (‘the OHS Act’).

5    There is no dispute that the CFMEU representatives were authorised representatives of the CFMEU, that each held the necessary entry and, by virtue of s 494 of the FW Act, that they were entitled to enter the premises.

6    The CFMEU representatives were met on arrival at the premises by Mr Gittany and were permitted to carry out their inspection of the premises. After inspecting various areas, including an amenities room and a first aid area, the CFMEU representatives moved outside the premises to investigate a scaffold in an adjoining car park. A concrete pump associated with the building work was located in the car park. After at least one of the CFMEU representatives spoke to the operator, the pump was turned off and a proposed concrete pour was interrupted. Such conduct resulted in heated discussions between the CFMEU representatives and other workers on site as well as with Mr Gittany. Some violence followed, in consequence of which the police were notified. The police arrived approximately 15 to 30 minutes later and order was restored. In the intervening period, Mr Miller claimed that the CFMEU representatives were not permitted to re-enter the premises. The police remained for approximately 15 minutes and thereafter the CFMEU officials and a WorkCover inspector entered upon the premises unimpeded.

LEGISLATIVE FRAMEWORK

7    The FW Act allows for the issue of entry permits to officials of an organisation if Fair Work Australia (as it was then known) (‘FWA’) is satisfied that such an official is a fit and proper person to hold the permit: s 512 of the FW Act. A permit holder is permitted to enter premises in a range of circumstances, including to:

a)    investigate suspected contraventions of the FW Act: s 481;

b)    hold discussions with employees: s 484; or

c)    exercise State or Territory occupational health and safety rights pursuant to State or Territory legislation: s 494.

8    ‘Premises’ is defined by s 12 of the FW Act to include any land, building or structure, or any part thereof.

9    The relevant New South Wales occupational health and safety legislation at the time of the alleged contraventions was the OHS Act (since repealed by the Work Health and Safety Act 2011 (NSW)). An authorised representative of an industrial organisation was permitted to enter a workplace pursuant to s 77 of the OHS Act, which stated:

Powers of entry of places of work

An authorised representative of an industrial organisation of employees may, for the purpose of investigating any suspected breach of the occupational health and safety legislation, the Coal Mine Health and Safety Act 2002 or the Mine Health and Safety Act 2004, enter any premises the representative has reason to believe is a place of work where members of that organisation (or persons who are eligible to be members of that organisation) work.

10    In order to enter a premises to exercise a State or Territory occupational health and safety right under the FW Act, an official of an organisation must satisfy the following three criteria:

a)    the official must hold an entry permit: s 494(1);

b)    the State or Territory occupational health and safety right is conferred by a State or Territory occupational health and safety law: s 484(2); and

c)    an additional connection to an exercise of power by the Federal legislature must exist: ss 494(2)(a)–(g).

11    Mr Gittany does not dispute that the first and second criteria were met. The additional connections under the third criterion, as contained in s 494(2) of the FW Act, are as follows:

Official must be permit holder to exercise State or Territory OHS right

…

Meaning of State or Territory OHS right

(2)     A right to enter premises, or to inspect or otherwise access an employee record of an employee that is on premises, is a State or Territory OHS right if the right is conferred by a State or Territory OHS law, and:

(a)     the premises are occupied or otherwise controlled by any of the following:

(i)     a constitutional corporation;

(ii)     a body corporate incorporated in a Territory;

(iii)     the Commonwealth;

(iv)     a Commonwealth authority; or

(b)     the premises are located in a Territory; or

(c)     the premises are, or are located in, a Commonwealth place; or

(d)     the right relates to requirements to be met, action taken, or activity undertaken or controlled, by any of the following in its capacity as an employer:

(i)     a constitutional corporation;

(ii)    a body corporate incorporated in a Territory;

(iii)    the Commonwealth;

(iv)     a Commonwealth authority; or

(e)    the right relates to requirements to be met, action taken, or activity undertaken or controlled, by an employee of, or an independent contractor providing services for, any of the following:

(i)     a constitutional corporation;

(ii)    a body corporate incorporated in a Territory;

(iii)    the Commonwealth;

(iv)    a Commonwealth authority; or

(f)    the exercise of the right will have a direct effect on any of the following in its capacity as an employer:

(i)     a constitutional corporation;

(ii)    a body corporate incorporated in a Territory;

(iii)    the Commonwealth;

(iv)    a Commonwealth authority; or

(g)    the exercise of the right will have a direct effect on a person who is employed by, or who is an independent contractor providing services for, any of the following:

(i)     a constitutional corporation;

(ii)    a body corporate incorporated in a Territory;

(iii)    the Commonwealth;

(iv)     a Commonwealth authority.

…    

12    Sections 501 and 502 of the FW Act provide:

501 Person must not refuse or delay entry

A person must not refuse or unduly delay entry onto premises by a permit holder who is entitled to enter the premises in accordance with this Part.

502 Person must not hinder or obstruct permit holder

(1)    A person must not intentionally hinder or obstruct a permit holder exercising rights in accordance with this Part.

...

(3)    Without limiting subsection (1), that subsection extends to hindering or obstructing that occurs after an entry notice is given but before a permit holder enters premises.

13    Each of ss 501 and 502(1) are, pursuant to s 539 of the FW Act, civil remedy provisions, the maximum penalties prescribed being 60 penalty units for an individual and 300 penalty units for a corporation (see ss 539 and 546(2)).

14    As a broad rule, parties bear their own costs in employment disputes. This is subject to s 570 of the FW Act which states as follows:

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.

(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

…

PRIMARY JUDGE’S FINDINGS

Alleged contravention of s 502

15    The primary judge found that the CFMEU did not present its case clearly due to an important difference between its points of claim and its submissions. In the points of claim, the CFMEU asserted its representatives had been hindered and obstructed in the exercise of an unspecified right associated with the inspection of the concrete pump in the car park (‘the first asserted right’). In its submissions, the CFMEU argued that Mr Gittany prevented the CFMEU representatives from re-entering the premises following the inspection of the pump (‘the second asserted right’). The primary judge addressed both asserted rights.

16    Critically in respect of the first asserted right, the primary judge found that the CFMEU had only relied upon one constitutional criterion in s 494(2) of the FW Act to prove that the right to enter the premises was a State or Territory OHS right. That criterion was that the premises was ‘occupied or otherwise controlled’ by a ‘constitutional corporation’: s 494(2)(a)(i). Having noted that the car park where the concrete pump was located was separate to the premises, the primary judge found at [94]:

No evidence was adduced to show that the car park, or even the part of it where the pumping equipment was located, was occupied or controlled by a constitutional corporation, whether Hume Highway Constructions or some other company, and it has not been demonstrated that it was.

17     On that basis, the primary judge concluded at [95]:

In such circumstances I am not persuaded that on 6 December 2011 in the car park adjacent to the Premises, any “State or Territory OHS right” was enlivened in association with Messrs Miller, Koh and Razaghi’s inspection of the concrete pump. Consequently, any hindrance or obstruction which they allege was associated with that inspection did not amount to a contravention of s 502 of the [FW Act].

18    In respect of the second asserted right, namely that the CFMEU representatives were prevented from re-entering the premises, the primary judge drew a distinction between ‘exercising rights’ under s 502 of the FW Act and seeking to exercise rights. His Honour stated at [96] that ‘while s 501 concerns the assertion of a right, s 502 concerns its actual exercise in the sense of it being put into practical effect’. His Honour came to the following conclusion at [97]:

The initial exercise of Messrs Miller, Koh and Razaghi’s rights of entry to the Premises concluded when they left the Premises for the car park. They might have asserted a right to enter the Premises for a second time once they had completed their dealings with the concrete pump operator but they did not embark upon the exercise of the right until they had actually re-entered the Premises. Consequently, any hindrance or obstruction in the car park of their right to re-enter the Premises did not affect a right which was in the course of being exercised or amount to a contravention of s 502.

Alleged contravention of s 501

19    On the issue of whether there had been a refusal or undue delay in permitting the CFMEU representatives access to the premises in contravention of s 501 of the FW Act, the primary judge noted that there were discrepancies between the testimony of the CFMEU representatives and Mr Gittany. His Honour rejected the evidence of the CFMEU witnesses, finding their testimony to be unconvincing and inconsistent in respect of various events that occurred immediately before the police attended the premises. It was agreed between the parties however that the CFMEU representatives were prevented from re-entering the premises whilst they awaited the arrival of the police. The determinative issue was whether such prevention amounted to either a refusal or undue delay.

20    The primary judge’s construction of refusal and undue delay for the purposes of s 501 of the FW Act is significant. At [113], his Honour stated:

The juxtapositioning in s 501 of “refuse” and “unduly delay” indicates that a denial of entry which involves a refusal is something more than a denial of entry which involves undue delay. This reflects the fact that a denial may be conditional or unconditional. The only denial of entry which, realistically, is more adverse to a right of entry than one involving undue delay is one where access will not be afforded. That is to say, in s 501 “refuse” is intended to mean an unconditional denial of entry whereas a conditional denial of entry, where entry will not be denied once a condition is satisfied, is not a refusal for the purposes of s 501 although it may amount to undue delay.

21    Furthermore, and relying upon Michaels v The Queen (1995) 184 CLR 117 at 123 and Board of Control of Michigan Technological University v Deputy Commissioner of Patents (1981) 53 FLR 26 at 33, the primary judge found at [116] ‘undue’ to mean ‘an interval of time which is excessive, unreasonable or unnecessary in the circumstances’.

22    The primary judge concluded that Mr Gittany had not refused entry onto the premises to the CFMEU representatives following the inspection of the concrete pump; rather, entry was conditional upon the arrival of the police. His Honour also held that in light of the risk to public order that re-admitting the CFMEU representatives onto the premises would likely present, the condition imposed upon their re-entry by Mr Gittany was prudent and appropriate. It was also noted that the police did not take long to arrive at the premises. Accordingly, his Honour found that the conditional entry of the CFMEU representatives did not amount to undue delay.

Costs

23    The primary judge considered, in the context of s 570 of the FW Act, whether the CFMEU had alleged contraventions of ss 501 and 502 of the FW Act without reasonable cause.

24    In respect of the s 502 issue, his Honour found at [13] of the second judgment:

I am satisfied that when the proceeding was initiated the CFMEU did not have a reasonable basis to allege that its officials were confronted by “employees of the First Respondent” while inspecting “the First Respondent’s concrete pump which was located in the car park of the premises” and that, in the absence of evidence on those points, that aspect of the proceeding was doomed to fail.

25    In the alternative, the primary judge held that the failure of the CFMEU to substantiate those allegations with evidence indicated an absence of such evidence. His Honour therefore found at [14] that it was unreasonable for the CFMEU to allege that the respondents had breached s 502 in respect of ‘the actions of the workers or the inspection of the pump’.

26    His Honour then considered the alleged personal involvement of Mr Gittany and the attempted re-entry of the CFMEU representatives onto the premises. The primary judge found that the CFMEU representatives had been untruthful in their testimony. His Honour said at [18]:

… I concluded that Messrs Miller, Koh and Razaghi had not been telling the truth when they said that Mr Gittany had behaved in a threatening way. Consequently, this aspect of the case was not a situation of a party not making out its allegations because its evidence was not persuasive but was, instead, a situation where that aspect of the proceeding was based on allegations which were not true. It was not reasonable to make such allegations or to base part of the case on them.

27    His Honour concluded that there was no reasonable cause for the CFMEU to allege a contravention of s 502 of the FW Act.

28    As to the pleaded breach of s 501, his Honour found that the determination of the resultant issues depended upon the proper interpretation of the section and consideration of whether the conditional entry amounted to undue delay. His Honour held that the CFMEU did not lack reasonable cause to allege a breach of s 501.

29    The primary judge, at [23], awarded both Hume Highway and Mr Gittany half of their costs as ‘the proceeding was instituted without reasonable cause because approximately half of it was brought without reasonable cause’.

SUBMISSIONS & CONSIDERATION

Alleged contravention of s 502

Submissions

30    The CFMEU submits that the primary judge erred by concluding first that no State or Territory OHS right was enlivened in connection with the inspection of the concrete pump in the car park (being the first asserted right referred to above), and secondly that the rights of entry being exercised by the CFMEU representatives ceased when they left the premises to inspect the concrete pump (being the second asserted right).

31    The CFMEU in essence submitted that the first asserted right met the requisite constitutional criteria to be satisfied in s 494(2) of the FW Act by virtue of the breadth of the criteria contained in ss 494(2)(d)–(g): see [11] above. Mr Gittany argued that regardless of the breadth of the provisions in s 494(2), the primary judge correctly identified that the CFMEU only sought to rely on s 494(2)(a) before the FCCA, that being that the car park was occupied or otherwise controlled by a constitutional corporation.

32    In respect of the second asserted right, the CFMEU referred to the explanatory memorandum to the Fair Work Bill 2008 (Cth) and the breadth with which s 502 was described. Specifically, the following provisions were drawn to the Court’s attention:

1997.    Clause 502 prohibits a person from intentionally hindering or obstructing a permit holder. This would cover behaviour such as making repeated and excessive requests that a permit holder show his or her entry permit, refusing entry despite the permit holder having an entry right under this Part or failing to provide access to records that the permit holder is entitled to inspect. It would also include, for example, deliberately altering rosters so that employees with whom the permit holder wished to meet were not present on the premises at the time of the permit holder's intended entry.

…

1999.    Subclause 502(3) specifies that this clause covers action that hinders or obstructs a permit holder that is taken after an entry notice is given but before a permit holder enters the premises. This provision would ensure that any action taken before the permit holder enters the premises but which would hinder or obstruct that permit holder while on the premises is caught by this clause. An example of this type of conduct would include situations such as destroying, concealing or manufacturing evidence that relates to a suspected contravention which the permit holder is intending to investigate.

33    It became apparent that the CFMEU contended for an interpretation of s 502 that encompassed hindrances or obstructions that occurred both prior to permit holders entering a premises, and in between consecutive entries to the same premises where those entries were only separated by a reasonable period of time. In that regard, the CFMEU’s submissions emphasised that the primary judge accepted at [88] of the first judgment that the inspection of the premises was incomplete when the CFMEU representatives entered the car park.

34    In response to these contentions, Mr Gittany argued that the reasoning of the primary judge was correct, but that in any event, the second asserted right was not pleaded before the FCCA.

Consideration

35    As to the first asserted right, the points of claim relied upon by the CFMEU before the FCCA alleged that Hume Highway was a constitutional corporation, that Hume Highway controlled or occupied the premises, and that the hindrance to the CFMEU representatives occurred when they were entitled to enter the premises. Significantly, the particulars assert that the hindrance took place in the car park of the premises. On appeal, the CFMEU did not identify at which point it sought to assert before the FCCA that another constitutional criterion under s 494(2) was satisfied. Instead it obscurely referred in written submissions to s 42 of the Federal Circuit Court of Australia Act 1999 (Cth) (‘the FCCA Act’), which provides that the FCCA ‘must proceed without undue formality and must endeavour to ensure that the proceedings are not protracted’.

36    The basis of reliance by the CFMEU upon s 42 of the FCCA Act is unclear. If it was to suggest that the primary judge should have considered the relevancy of each of the constitutional criteria under s 494(2), even though the only constitutional criterion relied upon before the FCCA was that Hume Highway controlled or operated the premises, then that submission must be rejected. The primary purpose of s 42 of the FCCA Act is to promote expediency in the resolution of matters before the FCCA: WZASQ v Minister for Immigration and Anor [2013] FCCA 1726 at [33]; Auguste v Nikolyn Pty Ltd and Anor [2013] FCCA 1630 at [16]. It does not impose an obligation on the FCCA to go behind the pleadings of an applicant. It does not diminish the need for an applicant to state the case that is to be relied upon. In these circumstances, the primary judge was correct to find that the constitutional nexus, as pleaded, did not exist so as to enliven a State or Territory OHS right in connection with the inspection of the concrete pump.

37    The CFMEU submits that the primary judge erred when he found at [97] that the right of entry being exercised by the CFMEU representatives concluded when they left the premises. It is also submitted that such conclusion was inconsistent with the primary judge’s observation at [88] that it was agreed ‘in very general terms’ that the CFMEU representatives had not completed their inspection before moving to the car park.

38    The primary judge was correct in his findings. As a matter of law, once the CFMEU representatives departed the premises, the statutory right of entry ceased. Such consequence resulted from the fact that the right of entry was wholly dependent upon the existence of a requisite constitutional foundation. This finding is not inconsistent with the observation at [88] which is directed not to a matter of law, but to a matter of fact. The issues are distinct, as was explained by the primary judge at [96], where he said:

… Moreover, ss 501 and 502 are relevantly identical to a predecessor section considered in Pine v Doyle [2005] FCA 977 where Merkel J said at [15] that a provision which spoke of a person “exercising powers” of entry required that the power be exercised as a matter of fact, rather than as a matter of law, whereas a provision which spoke of a person being “entitled to enter” was a reference to the exercise of the statutory power as a matter of law. That is to say, while s 501 concerns the assertion of a right, s 502 concerns its actual exercise in the sense of it being put into practical effect.

39    It follows that each of the CFMEU’s submissions on this issue must be rejected.

Alleged contravention of s 501

Submissions

40    The CFMEU submits that the primary judge erred in finding that a conditional denial of entry does not amount to a refusal of entry. Much emphasis was placed on the fact that the primary judge’s summary of Mr Gittany’s evidence referred to the CFMEU representatives being refused re-entry to the premises, only for his Honour to subsequently find that the refusal referred to only amounted to a conditional denial of entry. The relevant paragraph from the first judgment is [67], which states as follows:

Mr Gittany said that once the police defused the situation and there were no longer any workers on the site, Messrs Miller, Koh and Razaghi completed their inspection. He conceded that, until that point, he had refused them entry but said that he had done so because if he had not there would have been a very big fight.

    [Emphasis added]

41    The CFMEU also challenged the primary judge’s construction of s 501, submitting that the legislative purpose of the FW Act would be frustrated if conditions were allowed to be imposed on the entry of permit holders to relevant premises. Reliance was placed upon Construction, Forestry, Mining and Energy Union v Safety Glass [2010] FCA 989 in which Tracey J observed at [18], inter alia:

The [FW] Act provides a detailed scheme to regulate the exercise, by union officials, of their right to enter an employer’s premises. Various restrictions are placed on the right of entry to minimise inconvenience to the employer or disruption to productive work. Provided, however, that the right of entry is exercised in accordance with the provisions of the Act, union officials are entitled to unimpeded access to business premises for prescribed purposes. This is an important right which enables unions to recruit members and protect the industrial interests of their members.

[Emphasis added]

Consideration

42    The primary judge succinctly encapsulated the critical issue in the first decision at [110]. His Honour said:

Nevertheless, all parties agreed that Messrs Miller, Koh and Razaghi were prevented from re-entering the Premises for a period as they awaited the arrival of the police. This raises the question whether the delay, which all parties agreed was at Mr Gittany’s insistence, amounted to a refusal of entry or to an undue delay to entry in breach of s 501 of the [FW Act]. It also raises the question of the proper meanings of “refuse” and “unduly” where they appear in s 501.

43    It is convenient to first address the submission by the CFMEU that the primary judge had already found as a matter of fact at [67] of the first decision that Mr Gittany refused the CFMEU representatives entry to the premises. This is an over-zealous reading of his Honour’s reasons. A plain interpretation of the paragraph in context suggests that his Honour was paraphrasing the evidence of Mr Gittany. It is reasonable to assume that if Mr Gittany had used the word ‘refused’ in evidence, he would have done so colloquially rather than in reference to s 501 of the FW Act. Even if however the primary judge was not paraphrasing Mr Gittany, there is no suggestion that his Honour intended the use of the word ‘refused’ to show that Mr Gittany had contravened s 501. The primary judge appropriately considered the issue of whether Mr Gittany’s decision to deny the CFMEU representatives re-entry to the premises amounted to a refusal under s 501: see [112]–[117] of the first decision. At best for the CFMEU, his Honour’s use of the word ‘refused’ in [67] may amount to loose language, but it does not of itself impugn his Honour’s reasoning.

44    The CFMEU’s submission that conditional entry is not permitted under the FW Act must also be rejected. Although the CFMEU has highlighted the significant powers afforded to permit holders under the FW Act, the primary judge’s construction of s 501 was sound. The phrase in such section that ‘[a] person must not refuse or unduly delay entry onto premises’ inescapably leads one to consider and juxtapose ‘refuse’ against ‘unduly delay’. The Court agrees with his Honour’s findings at [113] of the first judgment, reproduced at [20] above, that for the purposes of s 501, a refusal is an unconditional denial of entry whereas a conditional denial of entry may be permitted where it does not amount to an undue delay. To suggest otherwise fails to give the existence of the word ‘unduly’ its full effect. ‘Undue’ has been defined, albeit in different circumstances, as simply meaning ‘excessive’: Liberian Shipping Corporation v A King & Sons Ltd [1967] 1 All ER 934 at 938.

45    No excessive delay was demonstrated in the present case. On the contrary, the delay was short and the reasons advanced were wholly justifiable. The primary judge accepted at [117] of the first decision Mr Gittany’s explanation that the situation ‘presented too much of a risk to public order’ to permit the CFMEU representatives to re-enter the premises before the police arrived. His Honour also noted that each of the CFMEU representatives expressed concern for their safety arising out of the behaviour of the angry building workers. Taking these matters into account, his Honour concluded at [117]:

In my view a delay of this sort, and for the reason identified by Mr Gittany, was prudent and appropriate and for that reason I conclude that it did not amount to an undue delaying of entry. In the latter respect, it appears that the police did not take long to arrive at the Premises, possibly no more than thirty minutes.

46    It follows that the primary judge was correct to conclude that there was no refusal by Mr Gittany to refuse re-entry and that the delay was not undue. The Court rejects the second ground of appeal.

COSTS

Submissions

47    The CFMEU accepts the legal principles stated by the primary judge in the second judgment, but submits that they were misapplied. It argues that his Honour’s decision on costs should have been based upon the central tenet of its case, that being whether Hume Highway and/or Mr Gittany hindered or obstructed the CFMEU representatives while they were exercising their statutory rights of entry. Instead, the CFMEU submits that the primary judge awarded costs to the respondents on irrelevant findings of the conduct of Mr Gittany and employees of Hume Highway. Those findings are at [13] and [18] of the second judgment (reproduced at [24] and [26] respectively above).

48    The CFMEU also submits that the primary judge did not provide reasons for exercising his discretion to award costs. It observes that the satisfaction of statutory conditions to award costs does not automatically lead to such an award being made, as was the case in Qantas Airways Ltd v Transport Workers’ Union of Australia (No 2) (2011) 211 IR 119 at [208].

Consideration

49    In Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257, Wilcox J considered s 347 of the Industrial Relations Act 1988 (Cth). In summary, such section provided that costs would not be ordered against another party to a proceeding ‘unless the first-mentioned party instituted the proceeding vexatiously or without reasonable cause’. In considering the phrase ‘without reasonable cause’, his Honour observed at 264 that in R v Moore; Ex parte Federate Miscellaneous Workers’ Union of Australia (1978) 140 CLR 470 at 473, Gibbs J said:

In my opinion a party cannot be said to have commenced a proceeding ‘without reasonable cause’, within the meaning of that section, simply because his argument proves unsuccessful.

50    Wilcox J concluded that the determination of the meaning of ‘without reasonable cause’ was to ask ‘whether, upon the facts apparent to the applicant at the time of instituting the proceeding, there was no substantial prospect of success’. His Honour continued at 265:

But where, on the applicant’s own version of the facts, it is clear the proceeding must fail, it may properly be said that the proceeding lacks a reasonable cause.

51    It is also apposite to recall the confines imposed on an appellate court in interfering with the exercise of judicial discretion of a primary judge. In House v The King (1936) 55 CLR 499, Dixon, Evatt and McTiernan JJ said at 504-505:

The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so.

52    The primary judge only imposed the costs order against the CFMEU in relation to its claims concerning s 502 of the FW Act. His Honour did so for two reasons. As to the first asserted right, the CFMEU did not adduce any evidence to prove that the car park was occupied or controlled by a constitutional corporation. It was essential that one of the criteria under s 492(2) be established. By making no attempt to satisfy this requirement, the first asserted right had no prospects of success. This was made clear at [13] of the second judgment. The submission of the CFMEU that his Honour mistakenly focused on the conduct of employees of Hume Highway in this regard strains credulity.

53    As to the second asserted right, his Honour considered the evidence of the CFMEU’s representatives to be untruthful in relation to their conduct and that of Mr Gittany in the car park. In particular, his Honour found that the allegations made against Mr Gittany that he engaged in threatening conduct were baseless. Such testimony was of pivotal importance as to whether the actions of Mr Gittany in temporarily denying the CFMEU representatives re-entry to the premises constituted undue delay under s 502 of the FW Act. This was made apparent at [17] of the second judgment where his Honour said:

In relation to that evidence I found that:

Overall, where Mr Gittany’s evidence differs from that of Messrs Miller, Koh and Razaghi, I prefer his evidence. (at [107] [of the first judgment])

and

… I find that Mr Gittany did not threaten Messrs Miller, Koh and Razaghi or endeavour to keep them from re-entering the Premises in the manner alleged by the CFMEU or for the reason implicitly advanced by the CFMEU as the motivation for such conduct. (at [109] [of the first judgment])

[Emphasis added]

54    It follows that the dishonesty of the CFMEU representatives in relation to Mr Gittany’s conduct was not an extraneous or immaterial matter for the primary judge to consider in determining whether the CFMEU had reasonable cause to allege that s 502 had been contravened by either Hume Highway or Mr Gittany.

55    Finally, the CFMEU’s submission that the primary judge should have provided reasons for exercising his discretion to award costs should also be rejected. The mere fact that the second judgment does not refer to the exercise of a discretion by the primary judge does not in itself suggest that his Honour made an award for costs simply because the conditions under s 570 of the FW Act were satisfied. A complete reading of the first and second judgments clearly reflects that his Honour deemed an award of costs to be appropriate in the circumstances.

56    As each ground of appeal has been rejected, it follows that the appeal must be dismissed with costs.

Associate:

Dated:    3 March 2014