FEDERAL COURT OF AUSTRALIA

Kennedy v Secretary, Department of Industry (No 2) [2015] FCA 884

THE COURT ORDERS THAT:

1.    The applicant pay the first respondent’s costs, to be taxed if not agreed.

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

REASONS FOR JUDGMENT

Buchanan J:

Background

1    On 15 July 2015, I dismissed an application under s 39B of the Judiciary Act 1903 (Cth) which was instituted in this Court by the applicant (Kennedy v Secretary, Department of Industry [2015] FCA 714). In that application, the applicant sought judicial review of decisions of the Fair Work Commission (“FWC”) constituted under the Fair Work Act 2009 (Cth) (“the FW Act”). The application for judicial review alleged jurisdictional error on the part of a Full Bench of the FWC which had refused the applicant permission to appeal against an earlier decision of a single member of the FWC. The subject matter of those two proceedings was whether the applicant should be granted an extension of time to bring an application to the FWC with respect to alleged unfair dismissal. Disposition of an application of that kind is highly discretionary and, as I pointed out in the earlier judgment, a very substantial procedural bar of showing “exceptional circumstances” was imposed by s 394 of the FW Act, before any question of discretion even arose.

2    It will be apparent from the terms of the earlier judgment that I found the applicant’s contentions that the Full Bench (or the single member) had committed any form of jurisdictional error to be without any substance or merit. In particular, I rejected as unjustified various procedural complaints which were made about the constitution of the Full Bench and the conduct of the proceedings by the Full Bench.

Procedural matters

3    The first respondent indicated at the hearing that it would apply for its costs if the application to this Court was rejected. Directions were made at the time of the earlier judgment that written submissions were to be filed about any question of costs, and that any application for costs would be dealt with on the papers, without a further oral hearing. The first respondent subsequently made a formal application for costs, supported by written submissions, in accordance with those directions.

4    The applicant did not file any submission on the question of costs. Rather, after time to make a submission had passed and after advice to him that a judgment about costs would be given on 21 August 2015, on 19 August 2015 the applicant filed interlocutory applications seeking, respectively, a stay of the application for costs until an appeal against the earlier judgment had been heard, and a stay of the application for costs until a complaint to the Chief Justice had been addressed.

5    I have directed that the interlocutory applications be accepted for filing in case some further form of review was appropriate (e.g. as part of the appeal). However, as they were each filed after final judgment, without leave and outside the time allowed to deal with the question of costs, I do not regard it as necessary to deal formally with either of them and I do not propose to list them for hearing.

6    I am not prepared to delay or defer dealing with the question of costs. It is desirable that all the final orders in the matter (including any order as to costs) should be available to the Full Court dealing with an appeal, so that the Full Court may deal as well with that question if it is appropriate to do so.

The costs limitation in the Fair Work Act

7    The first respondent accepts that the applicant in the present case is protected from an award of costs by the provisions of s 570 of the FW Act unless it should be concluded that he instituted the proceedings in this Court “without reasonable cause” (s 570(2)(a)).

8    In Baker v Patrick Projects Pty Ltd (No 2) [2014] FCAFC 166, a Full Court of this Court affirmed (at [10]) that the test of whether proceedings of the present kind were instituted without reasonable cause required consideration of “whether, having regard to the facts apparent to the [applicant] at the time of instituting the … application for judicial review, there were no reasonable prospects of success”.

9    I accept that it may not have been apparent to the applicant in the present case that his application had no reasonable prospects of success. That is because I am satisfied that he had no real understanding of what was involved in the notion of jurisdictional error and the matters which would need to be demonstrated in order to find that the Full Bench (or the single member) had committed a jurisdictional error. However, it does not seem to me that this is the correct basis upon which to evaluate whether the proceedings were commenced without reasonable cause. In my view, the test stated by the Full Court in Baker is an objective one, involving consideration of whether, on the facts known to an applicant, the court considering a question of costs would be satisfied that there were not any reasonable prospects of success at the time the application was brought. The test is not concerned with honest belief (which I am prepared to accept in favour of the applicant) but with objective merit.

10    In my view, on the facts known to the applicant, there was no objective merit at all in the proceedings instituted by him in this Court. Some of the complaints (e.g. about gender equity) were either fanciful or plainly egregious. The others failed altogether to accept the serious difficulties in the applicant’s claims before the FWC or to appreciate the role of the FWC at first instance and on appeal and the special place of the notion of jurisdictional error in the proceedings which the applicant commenced in this Court. I am satisfied, therefore, that the first respondent has established that the applicant is not protected from an order of costs by s 570 of the FW Act.

Discretionary matters

11    It remains the case, even under s 570 of the FW Act, that costs are discretionary. Costs are not awarded to punish an unsuccessful party; however, neither should costs be withheld simply to avoid the imposition of a financial burden. Costs are awarded as a compensation to a successful party who has been put to the expense of instituting (or resisting) proceedings. They are awarded as a (usually) limited means of compensation.

12    The applicant was self-represented in the present case. However, that is not a circumstance which relieves an unsuccessful, self-represented litigant from an obligation to pay costs if they are otherwise justified. In Ogawa v The University of Melbourne (No 2) [2004] FCA 1275, Kenny J adopted the following statement by Hodgson CJ in Eq. in Bhagat v Royal & Sun Alliance Life Assurance Australia Ltd [2000] NSWSC 159 at [13] (which I also adopt as a statement of the relevant principle):

13    … I accept that a court does have to make allowances for the position of litigants in person, and to try to ensure that such a litigant does not lose out because of lack of expertise; although there is a limit to what the Court can do in that regard, while still remaining an impartial determinant of a dispute. The Court may in those circumstances refrain from making orders against litigants in person for conduct that might be considered as justifying orders for costs against represented litigants. By the same token, litigants in person can cause great hardship and expense to other parties, through making allegations and claims that lawyers would recognise as allegations and claims that could not reasonably or even properly be made, and through making proceedings much longer and much more expensive than they otherwise would be, by not focusing accurately on the real issues in the case. Conduct of that nature by legally represented parties would often lead to orders for indemnity costs. Litigants in person may escape the consequence of indemnity costs, but I do not think that the circumstance that a party is a litigant in person is a ground for displacing the ordinary result that costs follow the event.

Conclusion

13    In the present case, I am not satisfied that costs should be withheld from the first respondent. On ordinary principles, and having regard to the directions in Baker, in my view the appropriate order is that the applicant pay the first respondent’s costs, such costs to be taxed if not agreed.

Associate:

Dated:    21 August 2015