WESTERN AUSTRALIAN INDUSTRIAL MAGISTRATE’S COURT

PARTIES THE COMMUNITY AND PUBLIC SECTOR UNION (SPSF GROUP) (WA BRANCH)

CLAIMANT

-v-

VICE CHANCELLOR, MURDOCH UNIVERSITY

RESPONDENT

CORAM INDUSTRIAL MAGISTRATE G. CICCHINI

DATE WEDNESDAY, 22 JUNE 2005

CLAIM NO. M 19 OF 2005

CITATION NO. 2005 WAIRC 01898

REPRESENTATION 

CLAIMANT Mr. M Finnegan, Industrial Advocate,

RESPONDENT MR. D HOWLETT (OF COUNSEL)

REASONS FOR DECISION

Background

1. On 25 February 2005 “The Community and Public Sector Union (SPSF Group)(WA Branch)” filed its claim in this Court alleging a failure on the part of (the) “Vice Chancellor, Murdoch University”, to comply with an award, agreement or order.  By way of relief the Claimant sought the imposition of a penalty.

2. The originating Claim Form had attached to it a document entitled “Statement of Claim” in which the Claimant set out its claim.  Within that document reference was made to “The Community and Public Sector Union” and “Murdoch University” as being the parties to the subject agreement known as the “Murdoch University (General Staff) Enterprise Agreement 2000 (AG 790559)” (the agreement) registered pursuant to the provisions of the Workplace Relations Act 1996 (the WPRA).  It will be obvious from what I have said that there is an apparent inconsistency in that the named parties to the agreement referred to in the Statement of Claim are not the same as the named parties on the Claim Form.

3. On 28 February 2005 John Dasey, on behalf of the Respondent, filed a response denying the claim.  On 5 April 2005 Mr Howlett filed a Notice of Appointment of Solicitor advising the Court and the Claimant that he had been appointed to act for the Respondent.  On the same day the Respondent filed an amended response with an annexed document entitled “Respondent’s Amended Response”.  In essence the Respondent contended therein that the Claimant was not an organisation registered pursuant to the provisions of the WPRA and therefore lacked standing to make the claim. Further, it was asserted that the Respondent was not a party to the agreement.

4. On 6 April 2005 the Clerk of the Court held a pre-trial conference with respect to this matter.  Following the pre-trial conference the Clerk issued programming directions requiring, inter alia, that the Claimant file and serve further and better particulars of the claim and an outline of its case by 18 May 2005.

5. On 16 May 2005 the Claimant filed a Notice of Discontinuance of Action.  The Notice, on its face, cited the parties to the claim to be “CPSU – the Community and Public Sector Union” and “Murdoch University”.  Attached to the Notice of Discontinuance was a letter dated 13 May 2005, which bore the logos of the CPSU and the CSA.  It also stated the names of the Community and Public Sector Union SPSF Group WA Branch and Civil Service Association of WA Inc.  The letter written by Mr Finnegan addressed to the Clerk of the Court stated:

 Dear Sir,

 RE:     Claim No M19 of 2005

(1)   CPSU v Murdoch University

In light of the recent pre-trial conference on this matter, the CPSU has decided to discontinue this particular claim.  The relevant form will be filed with the Registry.

Notwithstanding the above, a fresh claim will be filed with the Registry in the near future.

Yours sincerely

6. It is common ground that the Claimant subsequently filed another claim in this Court.  Mr Dasey says in his affidavit made 24 May 2005 (paragraph 32) that claim M 59 of 2005 correctly names the parties who are also parties to the agreement.  He expresses the view (paragraph 34) that the Claimant discontinued the claim in this matter (M 19 of 2005) because of “defects in the identity of the Claimant and Respondent and defects in the Statement of Claim”.

7. On 26 May 2005 the Respondent filed an interlocutory application seeking the following:

“An order for the costs of application M19/2005 to be paid by the Respondent to the Claimant (sic).”

8. The interlocutory application was supported by the affidavit of Mr Dasey affirmed on 24 May 2005 to which I have already referred.

9. On 3 June 2005 the Claimant filed an interlocutory application seeking further and better particulars of the Respondent’s interlocutory application for costs.  It suffices to say that when that application came before me it was dismissed.  I reserved the issue of costs arising from the dismissal of that application.

10. On 13 June 2005 the Respondent filed the supplementary affidavit of John Dasey, affirmed the same day, to further support its claim.

11. The Claimant has not filed any affidavit in response to the application, nor has it sought to lead viva voce evidence with respect to the application.  Indeed the only affidavit filed was that of Mr Finnegan which is undated but filed on 3 June 2005 which supported the application for particulars but did not otherwise address the matters raised by Mr Dasey in his supporting affidavits.

12. It is worthy of note that, in each of the documents filed by the Respondent with respect to the application for costs, the Respondent is named as follows:

13. “Murdoch University or alternatively Vice Chancellor, Murdoch University.”

Determination

14. The Respondent’s application for costs arises by virtue of section 347 of the WPRA, which provides:

347        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 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):

(a)   costs includes all legal and professional costs and disbursements and expenses of witnesses.

15. In Mr Dasey’s supporting affidavit affirmed 24 May 2005 he says at paragraph 36 that:

“Murdoch now wishes to recover the costs of defending and dealing with Claim M19/05 on the grounds that Claim M19/05 was instituted frivolously and vexatiously.”

16. It seems from what he says that there is no real practical distinction to be drawn between the Vice Chancellor and the University itself in the defence of this proceeding other than the obvious technical variance in name.

17. The term “frivolously” is not contained within section 347 of the WPRA.  Indeed the terminology expressed by Mr Dasey hereinbefore referred to is more in keeping with State provisions relating to costs found in the Industrial Relations Act 1979 and the Industrial Magistrates’ Court (General Jurisdiction) Regulations 2000 (the Regulations) which refer to proceedings “frivolously or vexatiously instituted or defended”.

18. It is obvious that the Respondent in making the application proceeded on the basis that this proceeding had been frivolously or vexatiously instituted. The premise for that was that the Claimant had instituted proceedings in which it had no reasonable prospect of success. It is quite apparent that the notion of the proceedings having been instituted “without reasonable cause” was not specifically considered until such time as I alerted the parties to the particular wording of section 347 during the hearing of the Claimant’s application for further and better particulars on 8 June 2005.  The Claimant accordingly argues that this Court should not entertain an argument based on the element of “without reasonable cause”.  To do so would allow the Respondent to shift the goal posts and cause the Claimant to argue against something totally new.

19. I respectfully disagree with the Claimant because it is apparent from reading Mr Dasey’s affidavit made 24 May 2005 that he impliedly asserts, amongst other things, that this proceeding was instituted without reasonable cause. That is so despite the fact that he does not express it in that way. It is quite apparent that Mr Dasey has rolled together the distinct concept of “frivolous or vexatious” with that of “without reasonable cause” and labelled the same as “frivolous and vexatious”.  In the circumstances the Claimant cannot claim surprise.

20. The Claimant also takes issue with Mr Dasey’s affidavit affirmed 24 May 2005 because paragraphs 14 to 22 inclusive thereof are said to offend regulation 32 of the Regulations, which state:

21. Status of things said or done at a pre-trial conference

(1)   Anything said or done during a pre-trial conference is not to be used as evidence or referred to in a submission in the trial of the action or in any other legal proceedings as defined in section 3 of the Evidence Act 1906.

(2)   Nothing in subregulation (1) prevents evidence of anything said or done at a pre-trial conference from being used –

(a)   in support of an interlocutory application for default judgment or for the dismissal of a claim; or

(b)   on the trial of a person for an offence committed at the pre-trial conference.

22. Given that the application before me is not a matter contemplated by regulation 32(2) it would follow that regulation 32(1) would apply if the matter before me were a legal proceeding as defined in section 3 of the Evidence Act 1906.

23. “Legal proceeding” or “proceeding” is defined in section 3 of the Evidence Act 1906 to mean:

24. “legal proceeding” or “proceeding” includes any action, trial, inquiry, cause, or matter, whether civil or criminal, in which evidence is or may be given, and includes an arbitration;

25. The matter before me is a legal proceeding within that definition and accordingly any evidence given containing what was said at the pre-trial conference offends regulation 32 and ought to be excluded.  It is self-evident that paragraphs 14 to 22 of Mr Dasey’s affidavit offends regulation 32 and therefore must be struck out.  The offending paragraphs are accordingly struck out.  The effect of striking out those paragraphs is that it removes the foundation for Mr Dasey’s belief expressed at paragraph 34 of his affidavit, and considerably weakens the basis of this application.

26. To properly determine this matter I must consider why, as a matter of fact, the Claimant chose to discontinue this claim and institute a fresh claim.  Although the Claimant has had the opportunity of advising the Court as to why that occurred, it has chosen not to.  No adverse inference should be drawn from the failure to call evidence.  There is no particular reason to apply the rule in Jones v Dunkel (1959) 101 CLR 298.  The Claimant, in responding to this application, does not bear any onus.  The onus remains throughout upon the Respondent to make out its application based on the evidentiary material, which it can produce to substantiate its application.  The drawing of any adverse inference, in the circumstances, is tantamount to reversing the onus resting with the Respondent.

27. Mr Finnegan, from the bar table, asserts that the Claimant may have adopted the course of action for any number of reasons and that it would not be appropriate for the Court to speculate as to the reason why.  Further he says that, if the Court were to find that the claim was discontinued because of some technical defect relating to the naming of the parties, such would not amount to a proceeding having been instituted vexatiously or without reasonable cause.

28. In my view it is open to infer on the balance of probabilities that this claim was discontinued because it had been incompetently drafted, which resulted in the wrong entity having been named as Claimant.  The Claimant was not a named party to the agreement and therefore lacked standing.  That conclusion is easily reached if one has regard to the patent inconsistency apparent between the Claim Form and the Statement of Claim annexed thereto.  Further such conclusion is supported by the Claimant’s letter to the Clerk of the Court, annexed to the Notice of Discontinuance, and also by what Mr Dasey said at paragraph 32 of his affidavit made 24 May 2005 in which he states:

“The parties to the Agreement are correctly stated in Claim M59/05.”

29. It is quite apparent that rather than attempt to correct the error made, which could have been easily achieved by virtue of regulation 17 of the Regulations, the Claimant decided to discontinue this claim and start again.

30. Relevantly regulation 17 provides:

Amending a document

(1)   A court may, on an interlocutory application by a party to an action, allow the party to amend a document filed in relation to the action at any time before the court makes its final orders in relation to the action.

(2)   A court may, of its own motion, amend any defect or error in a document filed in relation to an action at any time before the court makes its final orders in relation to the action.

31. It seems that the CSPU in starting again not only corrected the misnomers but also took the opportunity to change its claim.  Such is apparent from what Mr Dasey said in his affidavit of the 24 May 2005 in which he said at paragraph 33:

“The Statement of Claim in M59/05 is significantly different from the Statement of Claim in M19/05.”

32. That assertion remains uncontradicted.  Having said that however, it will be apparent that Mr Dasey’s statement imports a subjective assessment.  I have not seen the Statement of Claim in M 59 of 2005 and therefore am not in a position to ascertain the extent of the difference between it and the Statement of Claim in this matter.   I proceed on the basis that the primary reason for the Claimant discontinuing this claim was because it named the wrong parties and rather than correct the defect it opted to discontinue and start again.  The costs application must be considered against that setting.

33. The policy thrown up by section 347 of the WPRA and its predecessor, being the now repealed provision in section 197A of the Conciliation and Arbitration Act 1904 has been considered in Heidt v Chrysler Australia Ltd (1976) 26 FLR 257.  At page 272 Northrop J said:

The policy of s.197A of the Act is clear.  It is designed to free parties from the risk of having to pay the costs of an opposing party.  At the same time the section provides a protection to parties defending proceedings which have been instituted vexatiously or without reasonable cause.  This protection is in the form of conferring a power in the court to order costs against a party who, in substance, institutes proceedings which in other jurisdictions may constitute an abuse of the process of a court.

34. In Neville William Thompson and Others v Eroll Hodder and Others (1989) 29 IR 339 their Honours Keely, Gray and Ryan JJ of the Federal Court of Australia Industrial Division said in their joint judgment at paragraph 12:

“It is apparent from these authorities that an applicant who has the benefit of the protection of s.347 will only rarely be ordered to pay the costs of a proceeding in exceptional circumstances.”

35. The Respondent argues that this claim was vexatious or without reasonable cause because upon the facts apparent to the Claimant at the time of instituting the proceeding, there was no prospect of success.  The Claimant could not have succeeded on any view because of its lack of standing.

36. The meaning of “without reasonable cause” has been the subject of judicial consideration.  In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Nestlé Australia Ltd [2005] FCA 717 delivered 3 June 2005 His Honour Marshall J reviewed the relevant authorities relating to the meaning thereof.  At paragraphs 3 to 7 he said:

3 Nestlé contended that the Union instituted the proceeding without reasonable cause. It submitted that, when issued, the application had no prospect of success. It submitted that the success of the application did not depend on any seriously disputed question of fact or the resolution of any arguable point of law.

4 As a Full Court said in Spotless Services Australia Ltd v Marsh [2004] FCAFC 155 at [13]:

(1)   "Whether a proceeding has been commenced without reasonable cause is relevantly established as a matter of objective fact."

5 In Spotless the Full Court considered that the application for prerogative relief was bound to fail. It ordered costs against the unsuccessful applicant. The expression "bound to fail" is similar to expressions such as "so obviously untenable that it cannot possibly succeed", "manifestly groundless" and "bad beyond argument" as referred to by von Doussa J in Hatchett v Bowater Tutt Industries Pty Ltd (1991) 28 FCR 324 at 327. Earlier, at 327, von Doussa J said:

(2)   "The test imposed by the expression "vexatiously or without reasonable cause" is similar to the one applied by a court on an application for the exercise of summary power to stay or strike out proceedings: see Heidt v Chrysler Australia Ltd (1976) 26 FLR 257 at 272 to 273 and Geneff v Peterson (1986) 19 IR 40 at 87 to 88."

6 As Gibbs J said in R v Moore; Ex parte Federated Miscellaneous Workers’ Union (1978) 140 CLR 470 at 473, in respect of a predecessor provision to s 347(1):

(3)   "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."

7 Further, as Gray J said in Geneff v Peterson (1986) 19 IR 40 at 88:

(4)   "...the focus of the section is on the institution of the proceedings, and the court should not allow itself to be influenced unduly by the actual result."

37. The Respondent says that if the Court views the Claimant’s claim as being untenable at institution then the Respondent ought to recover its costs.  In that regard I am asked to follow what His Honour Wilcox J said at pages 264 and 265 in Joseph Michael Kanan v Australian Postal and Telecommunications Union 43 IR 257:

It seems to me that one way of testing whether a proceeding is instituted “without reasonable cause” is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceeding, there was no substantial prospect of success.  If success depends upon the resolution in the applicant’s favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being “without reasonable cause”.  But where it appears that, on the applicant’s own version of the facts, it is clear that the proceeding must fail, it may properly be said that the proceeding lacks a reasonable cause.  That is the situation in the present case.  The qualification of s.347 applies.  The Court has power to order costs against the applicant.

I see no discretionary reason to withhold such an order.  It is not a matter of the applicant’s motives but, that he has put the respondent to the expense of resisting a claim which was always doomed to failure.  There is no question of punishing the applicant for his unreasonable course of action.  The rationale for making a costs order is that a measure of indemnity should be conferred upon the respondent for the costs it has been obliged to incur in responding to the unreasonably instituted proceeding.  I propose to order that the principal proceeding be dismissed with costs.  The costs of the motion will be costs in the principal proceeding and so covered by that order.

38. The review of authorities reveals that costs will only be awarded in exceptional circumstances if the party seeking costs can establish that the claim, on its merits, was utterly hopeless and doomed to failure.

39. Was the claim in this matter doomed to failure?  The answer is clearly no.  I say that because the apparent misnomers were something, which was correctable by virtue of regulation 17.  If the Claimant had sought to correct such error which it no doubt would have succeeded in doing then the proceeding could have continued to be determined on its substantial merits.  Accordingly it cannot be said that the proceedings were brought without reasonable cause.  The cause was there; it is just that the Claimant got it wrong in naming the parties.  It is not uncommon in this jurisdiction that parties are incorrectly named, particularly in circumstances where those not having legal training draft claims.  As His Honour Wolff CJ said at page 22 in Williams v Berini 1960 WAR 21:

“I think the law has long ceased to be a catch-as-catch-can business  …”

40. The correctable error was not fatal to the claim if corrected.  That is what should have occurred rather than to discontinue and start again.

41. The rationale for making a costs order is that a measure of indemnity should be conferred upon the Respondent given that it has been obliged to respond to unreasonably instituted proceedings.  The Claimant’s claim however continues, albeit in a different action and other than a technical sense it involves the same parties.  I fail to see in those circumstances how it can be said that the Respondent has incurred unnecessary costs.  If any unnecessary costs have been incurred, they have resulted from bringing this application for costs.

42. In so far as the claim for costs is based on the proceeding having been instituted vexatiously, that too must fail.  Vexatiousness imports more that omission.  There was omission in this matter constituted by the failure to correctly name the parties.  As His Honour North J said in Margaret Nilsen v Loyal Orange Trust (1997) 76 IR 180 at pages 181 and 182:

“. . . A proceeding will be instituted vexatiously where the predominant purpose in instituting the proceeding is to harass or embarrass the other party, or to gain a collateral advantage: see Attorney General v Wentworth (1988) 14 NSWLR 481 at 491. The approach of the High Court in an application for a permanent stay of criminal proceedings on the ground of abuse of process constituted by improper purpose is instructive. In Williams v Spautz (1992) 174 CLR 509, at 522, Mason CJ, Dawson, Toohey and McHugh JJ said:

(1)   “Bridge LJ identified one difficulty when he said ([1977] 1 WLR, at p 503; [1977] 2 All ER, at p 586):

(2)   ‘What if a litigant with a genuine cause of action, which he would wish to pursue in any event, can be shown also to have an ulterior purpose in view as a desired byproduct of the litigation? Can he on that ground be debarred from proceeding? I very much doubt it.’ (Emphasis added.)

(3)   So would we. But his Lordship, by implication, evidently sees no difficulty with the case in which the plaintiff does not wish to pursue his or her cause of action to a conclusion because he or she intends to use the proceedings for a collateral and improper purpose.”

43. Vexatiousness imports an act of commission and/or intent to harass or embarrass or gain a collateral advantage.  It amounts to an abuse of process.  There is not one scintilla of evidence that would support a finding that the claim was instituted vexatiously.

Result

44. It follows, for the reasons given that the Respondent’s claim for costs on the substantive claim and on the interlocutory application relating to costs should be dismissed.

G. Cicchini

Industrial Magistrate