Federal Court of Australia

Monash University v Murthi (Costs) [2024] FCA 783

ORDERS

THE COURT ORDERS THAT:

1.    There be no order as to costs.

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

REASONS FOR JUDGMENT

WHEELAHAN J:

Introduction

1    On 21 June 2024, I dismissed Monash University’s application for a declaration that the Fair Work Commission did not have jurisdiction to determine whether the first respondent, Dr Padma Murthi, breached the Australian Code for the Responsible Conduct of Research 2018, or otherwise to determine the merits or outcome of such an allegation, in the context of arbitrating a dispute about the application of the Monash University Enterprise Agreement (Academic and Professional Staff) 2019 (the Agreement): Monash University v Murthi [2024] FCA 663.

2    After I delivered judgment, I heard the parties on the question of costs. Counsel for Dr Murthi indicated that her client wished to consider making an application for costs on the basis that one of the conditions in s 570(2) of the Fair Work Act 2009 (Cth) (the Act) was engaged. Accordingly, I ordered that Dr Murthi make any such application by filing short written submissions, to which the University would have a chance to respond. I also directed that any costs application be determined on the papers, subject to further order of the Court.

3    In the event, Dr Murthi did make an application for costs. These are my reasons for dismissing her application and declining to make any order as to costs in this proceeding.

Principles

4    Section 570(1) of the Act relevantly provides –

A party to proceedings … in a court … 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.

5    This subsection establishes a default position: courts must not make costs orders in matters arising under the Act unless a specified exception applies. Sections 569 and 569A are not relevant here, which leaves just s 570(2) for consideration.

6    Section 570(2) provides –

(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 the FWC;

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

7    The policy of s 570 is to free parties from the risk of having to pay their opponents’ costs in matters arising under the Act, while at the same time protecting parties who are forced to incur costs as a result of another party’s unreasonable conduct: Australian Workers’ Union v Leighton Contractors Pty Ltd (No 2) [2013] FCAFC 23; 232 FCR 428 at [7] (Dowsett, McKerracher and Katzmann JJ). Primarily, the purpose of s 570 is to facilitate access to justice by assuaging the concerns of litigants that adverse costs orders will be made in the event that they fail in the litigation: see Ryan v Primesafe [2015] FCA 8; 323 ALR 107 at [64] (Mortimer J). Nevertheless, s 570 balances this consideration against the need to ensure that litigants act reasonably, and comply with their obligation to assist the Court to achieve the overarching purpose laid down in s 37M of the Federal Court of Australia Act 1976 (Cth).

Analysis

8    Dr Murthi based her application only on ss 570(2)(b) and (c). She submitted that the University’s application to this Court constituted an unreasonable act that caused her to incur costs, as well as an unreasonable refusal to participate in a matter before the Commission. The thrust of Dr Murthi’s submissions was that the University’s application was misconceived for two reasons. First, because it failed. And secondly, because even if it had succeeded, the University would not have achieved its further objective of avoiding costs in the Commission which related to the underlying question whether Dr Murthi committed plagiarism. Dr Murthi characterised the University’s conduct as an attempt to circumvent the processes and jurisdiction of the Commission.

9    Dealing first with Dr Murthi’s submissions on s 570(2)(b), I am not satisfied that the University has engaged in an unreasonable act such as to enliven the discretion to award costs. First, I do not consider it relevant whether the University would have achieved its further objective of avoiding costs if it had obtained a declaration in this Court. Even apart from the question of costs, the University was perfectly entitled to invoke the jurisdiction of this Court to keep the Commission within the bounds of its authority to decide. While the Commission had authority to form an opinion as to its own jurisdiction, it did not have authority to determine that question. Commencing this proceeding is not rendered unreasonable simply because success may not have brought the practical results that the University sought.

10    Secondly, Dr Murthi’s submission as to the merit of the University’s application rose little higher than an assertion that, because the Court ultimately concluded that the dispute was squarely within the jurisdiction of the Commission, that application was “misconceived”. Describing the application as “misconceived” engages with the distinction distilled by Tracey J, in relation to a precursor of s 570(2)(b), between “the pursuit of an argument which does not succeed and the institution of a proceeding which is misconceived in the sense of being incompetent” –

The prosecution of any incompetent or hopeless case can be regarded as “an unreasonable act” within the meaning of [the section]. Conversely, in my opinion, the pursuit of a contentious, and ultimately unsuccessful, argument is not an unreasonable act.

Australian and International Pilots Association v Qantas Airways Ltd (No 3) [2007] FCA 879; 162 FCR 392 at [36].

11    Except to emphasise that it failed, Dr Murthi has not advanced a persuasive case that the University’s application was misconceived. Suffice it to say that the law relating to jurisdiction is complex. As Kiefel CJ, Gageler and Keane JJ put it in Hossain v Minister for Immigration and Border Protection [2018] HCA 34; 264 CLR 123 at [17], “the terminology of jurisdiction” is “readily … misunderstood”. That is because “jurisdiction” is a term that is sensitive to its legal context: see Kirk v Industrial Court (NSW) [2010] HCA 1; 239 CLR 531 at [63] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ), quoting Anisminic Ltd v Foreign Compensation Commission [1968] 2 QB 862 at 889 (Diplock LJ). Just as jurisdiction’s “mysteries … are not always fully understood”, the prospects of success on a jurisdictional issue cannot always be discerned with ease: see Australian Securities and Investments Commission v Edensor Nominees Pty Ltd [2001] HCA 1; 204 CLR 559 at [190] (Kirby J). In this area of the law, it is bold to describe a case as incompetent, hopeless, or misconceived. For my part, and without the benefit of any persuasive articulation of why the University’s case was misconceived, I am not satisfied that it was unreasonable for the University to have sought the declaration it did. The University had an arguable case, especially in relation to a possible implied derogation from the scope of the dispute resolution clause in the Agreement. While that case was ultimately rejected, it was no less arguable for that.

12    Nor am I persuaded by Dr Murthi’s submissions on s 570(2)(c). At every step of the way, the University has participated in the proceeding before the Commission. The University made a jurisdictional objection early in the course of the Commission proceeding, and subsequently filed submissions and other material in support of that objection. The University then took part in a directions hearing, after which the Commission made directions programming the dispute towards a final hearing on both jurisdiction and merits. By these very steps, the University took a full and active part in all aspects of the proceeding before the Commission. Nor was there any suggestion that the University would not continue to do so. Indeed, the very premise of seeking a declaration in this Court was that, without this relief, the University would incur costs arising out of its participation in the proceeding before the Commission. Simply seeking a court order to vindicate the University’s position in relation to the issues that were properly before the Commission is no refusal to participate in the Commission’s process. Consequently, I am not satisfied that the University refused to participate in a matter before the Commission, let alone that it did so unreasonably, as s 570(2)(c) requires.

Conclusion

13    There will be no order as to costs.

Associate:

Dated:    17 July 2024