Relative Networks Pty Ltd, Marco Vicario -v- Rosalba Vicario-Adams

Document Type: Decision

Matter Number: M 123/2021

Matter Description: Long Service Leave Act 1958 - Alleged breach of Act; Fair Work Act 2009 - Alleged breach of Act

Industry:

Jurisdiction: Industrial Magistrate

Member/Magistrate name: Industrial Magistrate B. Coleman

Delivery Date: 28 Jul 2023

Result: Application dismissed

Citation: 2023 WAIRC 00406

WAIG Reference: 103 WAIG 1451

DOCX | 41kB
2023 WAIRC 00406
WESTERN AUSTRALIAN INDUSTRIAL MAGISTRATES COURT


CITATION : 2023 WAIRC 00406

CORAM
: INDUSTRIAL MAGISTRATE B. COLEMAN

HEARD
:
19 JULY 2023

DELIVERED : 28 JULY 2023

FILE NO. : M 123 OF 2021

BETWEEN
:
RELATIVE NETWORKS PTY LTD
FIRST APPLICANT

AND

MR MARCO VICARIO
SECOND APPLICANT
AND

ROSALBA VICARIO-ADAMS
RESPONDENT

CatchWords : INDUSTRIAL LAW – Awarding of Indemnity Costs – Abuse of Process - Relevant principles applied – Application for Costs Dismissed
Legislation : Fair Work Act 2009 (Cth)
Long Service Leave Act 1958 (WA)
Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA)
Case(s) referred
to in reasons : Trustee for the MTGI Trust v Johnston (No 2) [2016] FCAFC 190
Patrick Jebb as trustee for The Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121
Denise Brailey v Mendex Pty Ltd T/A Mair and Co Maylands (1992) 73 WAIG 26
Shea v Energy Australia Services Pty Ltd (No 2) [2015] FCAFC 14
Result : Application Dismissed
REPRESENTATION:

APPLICANT : MR S. PACK (OF COUNSEL) AS INSTRUCTED BY TRINIX LAWYERS
RESPONDENT : MR T. LETTENMAIER (OF COUNSEL) AS INSTRUCTED BY VOGT LEGAL
REASONS FOR DECISION
1 By application lodged 7 June 2023, the first applicant and first respondent in the originating claim, Relative Networks Pty Ltd (the first applicant) and the second applicant and second respondent in the originating claim, Marco Vicario (the second applicant) seek indemnity costs be paid by the respondent and claimant in the originating claim, Rosalba Vicario-Adams (the respondent) pursuant to s 570(1) of the Fair Work Act 2009 (Cth).
Relevant Background to the Application for Costs
2 The respondent was the director of a company named Ovviare Pty Ltd (Ovviare) and had also been employed with the first applicant by way of oral contract from 2004.
3 Between March 2013 to October 2017, Ovviare invoiced the second applicant for services to the first applicant.
4 On 25 March 2021, Ovviare filed a general procedure claim (the GP claim) in the civil jurisdiction of the Magistrates Court of Western Australia, alleging that the first applicant had not paid Ovviare sums invoiced for services performed from 30 April 2015 to 15 September 2015.
5 Eleven weeks later, on 10 June 2021, the respondent filed a claim (the claim) in the Industrial Magistrate’s Court (the Court) alleging a failure by the applicants to comply with the Fair Work Act and the Long Service Leave Act 1958 (WA), asserting that she was an employee throughout the period from 2005 to 2017.
6 The first and second applicants filed a response to the claim on 14 July 2021 and thereafter, the claim was referred to Pre-Trial Conference held on 22 March 2022.
7 On 28 March 2022, the GP claim became inactive, and the first applicant received a letter from the Magistrates Court of WA. This was the first notification of the GP claim, since it had never been served on the first applicant.
8 On 28 September 2022, the GP claim was taken to be dismissed and the parties were notified.
9 Between March and August 2022, the Court wrote to the parties requesting a status update. After several rounds of correspondence, the matter was listed for an Initial Hearing.
10 On 14 October 2022, the second applicant received a copy of the GP Claim from the Magistrates Court.
11 On 21 October 2022, the Court held an Initial Hearing and orders were made listing the claim for a Show Cause hearing. Programming orders were made related to the filing of submissions and supporting affidavits.
12 In February 2023, the respondent instructed new solicitors.
13 From 3 to 15 March 2023, the respondent was suffering from ill health and was unable to properly instruct her solicitors.
14 On 14 March 2023 the respondent’s solicitor applied for an adjournment of the Show Cause hearing listed for 17 March 2023.
15 On 17 March 2023, the Court adjourned the hearing to 11 May 2023 and ordered the respondent to file and serve medical evidence related to the application to adjourn. The Orders of 21 October were extended to allow the respondent to file the legal submissions and supporting affidavits (the March Orders).
16 Between 3 April to 10 May 2023, the respondent was hospitalised and thereafter continued to receive treatment for her condition.
17 On 10 May 2023, the applicants filed an affidavit in preparation for the Show Cause hearing.
18 On 11 May 2023, at the Show Cause hearing, the applicants made an oral application to strike out the whole of the claim due to an abuse of process, relying upon the filed affidavit. The respondent was not present and her solicitor notified the Court that he was unable to obtain any instructions due to her health condition. As of that date, the respondent had not complied with the March Orders. At the hearing, the applicants’ application was granted: the whole of the claim was struck out and the claim was dismissed.
Determination
19 The Industrial Magistrates Court has the power to award costs either via reg 11 of the Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA) or s 570(1) of the Fair Work Act. The respondents rely on s 570(1) of the Fair Work Act and seek indemnity costs.
20 The discretion to award costs is enlivened if the Court is satisfied that ‘the party instituted proceedings vexatiously or without reasonable cause’, Fair Work Act s 570(2)(a).
or that ‘the party’s unreasonable act or omission caused the other party to incur the costs’. Fair Work Act s 570(2)(b).

21 In the Federal Court decision of Trustee for the MTGI Trust v Johnston (No 2) [2016] FCAFC 190, Siopis, Collier and Katzmann JJ stated at paragraph [10]:
Section 570(2)(a) distinguishes between proceedings which are instituted vexatiously and those which are instituted without reasonable cause. The concept of “vexatious” was recently explained by Pagone J in Garrett v Commissioner of Taxation [2015] FCA 117 at [4] as referring to proceedings which are scandalous, which disclose no reasonable cause of action, which are oppressive, which are embarrassing, or which are an abuse of the process of the Court.
22 At the Show Cause hearing on 11 May 2023, the whole of the claim was struck out as an abuse of process, since at the time of filing the claim in this Court on 10 June 2021, another claim was already active in another jurisdiction, covering the same subject matter. As stated by Vaughan J in Patrick Jebb as trustee for The Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121 at [111]:
Abuse of process may arise beyond the circumstance where a person seeks to re-litigate an issue already decided. There may be an abuse of the process of the court in seeking to litigate matters which could and should have been litigated in earlier proceedings.
23 Whether by error or by oversight, the GP claim was not discontinued prior to the filing of the claim in the Industrial Magistrates Court. Although it was ultimately discontinued via court registry processes, by filing in the Industrial Court jurisdiction when the civil claim in the Magistrates Court remained active litigation, the filing of the industrial claim was an abuse of process.
24 It follows therefore, that since the claim was struck out as an abuse of process, the applicants have established the threshold test set out in s 570(2)(a).
25 However, that is not the end of the matter, since the award of costs pursuant to s 570(1) remains discretionary. The general policy within industrial jurisdictions is that costs ought only be awarded in extreme cases. Denise Brailey v Mendex Pty Ltd T/A Mair and Co Maylands (1992) 73 WAIG 26, 27.

26 Once a criterion in s 570(2) has been established, the discretionary power should be exercised only where appropriate, to provide a means of compensating the successful party for costs thrown away, having regard to the actual circumstances of the case. Shea v Energy Australia Services Pty Ltd (No 2) [2015] FCAFC 14 [10] - [11].
The award of costs cannot be used as a method of imposing a penalty or punishment on the unsuccessful party. Ibid.

27 The consideration to exercise the power in s 570(1) therefore requires a careful analysis of the timeline of events, along with an analysis of the actions of each of the parties.
28 Reviewing the Statement of Claim filed in the Magistrates Court, Attachment two to the affidavit of Alister Norwood sworn 10 May 2023.
it appears that the claim was filed in haste, in order to comply with the looming deadline of the limitation period. Had the respondent not filed in a timely manner, then she would have been statute barred and would not have been able to progress a civil claim in that jurisdiction.
29 It is important to note that the GP claim was never served upon the first applicant, therefore, no legal work was undertaken by the first applicant in respect of that matter.
30 The respondent subsequently filed the claim the subject of this costs application in the Industrial Magistrates Court and a Response was filed by the first and second applicants.
31 Ultimately, the matter was referred to Pre-Trial Conference, which occurred eight months after the filing of the Response on 22 March 2022.
32 Subsequently, by notice issued on 28 March 2022, the Magistrates Court notified the first respondent that the GP claim was an inactive case.
33 The second applicant received a copy of the GP claim on 14 October 2022.
34 It is clear from the documents filed, that the first and second applicants became aware, at least by mid-October 2022, that a GP claim covering the same subject matter had been filed in another jurisdiction.
35 It was at that time that the application to strike out this claim should have been filed. The first and second applicants did not do so.
36 The first and second applicants wrote to the Court on 22 August 2022, seeking the industrial claim be dismissed due to default by the respondent. The Registry notified the first and second applicants that a formal application was required to be filed, however, the first and second applicants never filed an application for Default Judgment.
37 By the date of the Initial Hearing held on 21 October 2022, the first and second applicants were aware of the substance of the GP Claim. At the Initial Hearing, the Court made the parties aware that the Court was listing the matter for a Show Cause hearing to ensure that the Court’s resources were used efficiently and to ensure that costs were not wasted:
This court is required to deal with matters expeditiously and justly. And one of the factors in the Magistrates Court Civil Proceedings Act is to ensure that the court's resources are used as efficiently as possible.
I'm not going to list a trial that has no reasonable prospects for a claimant and waste the court's time, and also throw away costs to both the claimant and the defence in circumstances where, based on what I have seen, if it's the case that the respondents can… present the defence that they can… that there's no basis for any claim brought by Ms Vicario-Adams. So in that circumstance, it's appropriate. Transcript of proceedings page 3.

38 Yet, no mention was made at the Initial Hearing of the GP Claim. Instead, the first and second applicants were content to allow the Court to make programming orders for discovery, for affidavit evidence and for the filing of submissions. The claim was then adjourned to the Show Cause hearing.
39 It is not necessary to set out in detail the subsequent events: it is sufficient to state that after the Initial Hearing, further delays were incurred, primarily due to the deterioration in health of the claimant.
40 The first and second applicants had ample opportunity to file the Strike Out application from 14 October 2022 onwards, yet they chose not to do so. Whether that was a strategic decision or an oversight matters not.
41 Regrettably, the decision to file the Strike Out application almost eight months after notification of the substance of the GP claim has resulted in the accumulation of unnecessary legal costs for all parties and has wasted the Court’s time and resources.
42 It is therefore not appropriate to exercise the discretion in s 570(1) of the Act.
Result
43 The application for indemnity costs is dismissed.





B. COLEMAN
INDUSTRIAL MAGISTRATE


Relative Networks Pty Ltd, Marco Vicario -v- Rosalba Vicario-Adams

WESTERN AUSTRALIAN INDUSTRIAL MAGISTRATES COURT

 

 

CITATION : 2023 WAIRC 00406

 

CORAM

: Industrial Magistrate B. Coleman

 

HEARD

:

19 July 2023

 

DELIVERED : 28 JULY 2023

 

FILE NO. : M 123 OF 2021

 

BETWEEN

:

RELATIVE NETWORKS PTY LTD

FIRST APPLICANT

 

AND

 

MR MARCO VICARIO

SECOND APPLICANT

AND

 

ROSALBA VICARIO-ADAMS

RESPONDENT

 

CatchWords : INDUSTRIAL LAW – Awarding of Indemnity Costs – Abuse of Process - Relevant principles applied – Application for Costs Dismissed

Legislation : Fair Work Act 2009 (Cth)

Long Service Leave Act 1958 (WA)

Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA)

Case(s) referred

to in reasons : Trustee for the MTGI Trust v Johnston (No 2) [2016] FCAFC 190

Patrick Jebb as trustee for The Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121

Denise Brailey v Mendex Pty Ltd T/A Mair and Co Maylands (1992) 73 WAIG 26

Shea v Energy Australia Services Pty Ltd (No 2) [2015] FCAFC 14

Result : Application Dismissed

Representation:

 


Applicant : Mr S. Pack (of counsel) as instructed by Trinix Lawyers

Respondent : Mr T. Lettenmaier (of counsel) as instructed by Vogt Legal

REASONS FOR DECISION

1         By application lodged 7 June 2023, the first applicant and first respondent in the originating claim, Relative Networks Pty Ltd (the first applicant) and the second applicant and second respondent in the originating claim, Marco Vicario (the second applicant) seek indemnity costs be paid by the respondent and claimant in the originating claim, Rosalba Vicario-Adams (the respondent) pursuant to s 570(1) of the Fair Work Act 2009 (Cth).

Relevant Background to the Application for Costs

2         The respondent was the director of a company named Ovviare Pty Ltd (Ovviare) and had also been employed with the first applicant by way of oral contract from 2004.

3         Between March 2013 to October 2017, Ovviare invoiced the second applicant for services to the first applicant.

4         On 25 March 2021, Ovviare filed a general procedure claim (the GP claim) in the civil jurisdiction of the Magistrates Court of Western Australia, alleging that the first applicant had not paid Ovviare sums invoiced for services performed from 30 April 2015 to 15 September 2015.

5         Eleven weeks later, on 10 June 2021, the respondent filed a claim (the claim) in the Industrial Magistrate’s Court (the Court) alleging a failure by the applicants to comply with the Fair Work Act and the Long Service Leave Act 1958 (WA), asserting that she was an employee throughout the period from 2005 to 2017.

6         The first and second applicants filed a response to the claim on 14 July 2021 and thereafter, the claim was referred to Pre-Trial Conference held on 22 March 2022.

7         On 28 March 2022, the GP claim became inactive, and the first applicant received a letter from the Magistrates Court of WA. This was the first notification of the GP claim, since it had never been served on the first applicant.

8         On 28 September 2022, the GP claim was taken to be dismissed and the parties were notified.

9         Between March and August 2022, the Court wrote to the parties requesting a status update. After several rounds of correspondence, the matter was listed for an Initial Hearing.

10      On 14 October 2022, the second applicant received a copy of the GP Claim from the Magistrates Court.

11      On 21 October 2022, the Court held an Initial Hearing and orders were made listing the claim for a Show Cause hearing. Programming orders were made related to the filing of submissions and supporting affidavits.

12      In February 2023, the respondent instructed new solicitors.

13      From 3 to 15 March 2023, the respondent was suffering from ill health and was unable to properly instruct her solicitors.

14      On 14 March 2023 the respondent’s solicitor applied for an adjournment of the Show Cause hearing listed for 17 March 2023.

15      On 17 March 2023, the Court adjourned the hearing to 11 May 2023 and ordered the respondent to file and serve medical evidence related to the application to adjourn. The Orders of 21 October were extended to allow the respondent to file the legal submissions and supporting affidavits (the March Orders).

16      Between 3 April to 10 May 2023, the respondent was hospitalised and thereafter continued to receive treatment for her condition.

17      On 10 May 2023, the applicants filed an affidavit in preparation for the Show Cause hearing.

18      On 11 May 2023, at the Show Cause hearing, the applicants made an oral application to strike out the whole of the claim due to an abuse of process, relying upon the filed affidavit. The respondent was not present and her solicitor notified the Court that he was unable to obtain any instructions due to her health condition. As of that date, the respondent had not complied with the March Orders. At the hearing, the applicants’ application was granted: the whole of the claim was struck out and the claim was dismissed.

Determination

19      The Industrial Magistrates Court has the power to award costs either via reg 11 of the Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA) or s 570(1) of the Fair Work Act. The respondents rely on s 570(1) of the Fair Work Act and seek indemnity costs.

20      The discretion to award costs is enlivened if the Court is satisfied that ‘the party instituted proceedings vexatiously or without reasonable cause’,[i] or that ‘the party’s unreasonable act or omission caused the other party to incur the costs’.[ii]

21      In the Federal Court decision of Trustee for the MTGI Trust v Johnston (No 2) [2016] FCAFC 190, Siopis, Collier and Katzmann JJ stated at paragraph [10]:

Section 570(2)(a) distinguishes between proceedings which are instituted vexatiously and those which are instituted without reasonable cause. The concept of “vexatious” was recently explained by Pagone J in Garrett v Commissioner of Taxation [2015] FCA 117 at [4] as referring to proceedings which are scandalous, which disclose no reasonable cause of action, which are oppressive, which are embarrassing, or which are an abuse of the process of the Court.

22      At the Show Cause hearing on 11 May 2023, the whole of the claim was struck out as an abuse of process, since at the time of filing the claim in this Court on 10 June 2021, another claim was already active in another jurisdiction, covering the same subject matter. As stated by Vaughan J in Patrick Jebb as trustee for The Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121 at [111]:

Abuse of process may arise beyond the circumstance where a person seeks to re-litigate an issue already decided. There may be an abuse of the process of the court in seeking to litigate matters which could and should have been litigated in earlier proceedings.

23      Whether by error or by oversight, the GP claim was not discontinued prior to the filing of the claim in the Industrial Magistrates Court. Although it was ultimately discontinued via court registry processes, by filing in the Industrial Court jurisdiction when the civil claim in the Magistrates Court remained active litigation, the filing of the industrial claim was an abuse of process.

24      It follows therefore, that since the claim was struck out as an abuse of process, the applicants have established the threshold test set out in s 570(2)(a).

25      However, that is not the end of the matter, since the award of costs pursuant to s 570(1) remains discretionary. The general policy within industrial jurisdictions is that costs ought only be awarded in extreme cases.[iii]

26      Once a criterion in s 570(2) has been established, the discretionary power should be exercised only where appropriate, to provide a means of compensating the successful party for costs thrown away, having regard to the actual circumstances of the case.[iv] The award of costs cannot be used as a method of imposing a penalty or punishment on the unsuccessful party.[v]

27      The consideration to exercise the power in s 570(1) therefore requires a careful analysis of the timeline of events, along with an analysis of the actions of each of the parties.

28      Reviewing the Statement of Claim filed in the Magistrates Court,[vi] it appears that the claim was filed in haste, in order to comply with the looming deadline of the limitation period. Had the respondent not filed in a timely manner, then she would have been statute barred and would not have been able to progress a civil claim in that jurisdiction.

29      It is important to note that the GP claim was never served upon the first applicant, therefore, no legal work was undertaken by the first applicant in respect of that matter.

30      The respondent subsequently filed the claim the subject of this costs application in the Industrial Magistrates Court and a Response was filed by the first and second applicants.

31      Ultimately, the matter was referred to Pre-Trial Conference, which occurred eight months after the filing of the Response on 22 March 2022.

32      Subsequently, by notice issued on 28 March 2022, the Magistrates Court notified the first respondent that the GP claim was an inactive case.

33      The second applicant received a copy of the GP claim on 14 October 2022.

34      It is clear from the documents filed, that the first and second applicants became aware, at least by mid-October 2022, that a GP claim covering the same subject matter had been filed in another jurisdiction.

35      It was at that time that the application to strike out this claim should have been filed. The first and second applicants did not do so.

36      The first and second applicants wrote to the Court on 22 August 2022, seeking the industrial claim be dismissed due to default by the respondent. The Registry notified the first and second applicants that a formal application was required to be filed, however, the first and second applicants never filed an application for Default Judgment.

37      By the date of the Initial Hearing held on 21 October 2022, the first and second applicants were aware of the substance of the GP Claim. At the Initial Hearing, the Court made the parties aware that the Court was listing the matter for a Show Cause hearing to ensure that the Court’s resources were used efficiently and to ensure that costs were not wasted:

This court is required to deal with matters expeditiously and justly. And one of the factors in the Magistrates Court Civil Proceedings Act is to ensure that the court's resources are used as efficiently as possible.

I'm not going to list a trial that has no reasonable prospects for a claimant and waste the court's time, and also throw away costs to both the claimant and the defence in circumstances where, based on what I have seen, if it's the case that the respondents can… present the defence that they can… that there's no basis for any claim brought by Ms Vicario-Adams. So in that circumstance, it's appropriate.[vii]

38      Yet, no mention was made at the Initial Hearing of the GP Claim. Instead, the first and second applicants were content to allow the Court to make programming orders for discovery, for affidavit evidence and for the filing of submissions. The claim was then adjourned to the Show Cause hearing.

39      It is not necessary to set out in detail the subsequent events: it is sufficient to state that after the Initial Hearing, further delays were incurred, primarily due to the deterioration in health of the claimant.

40      The first and second applicants had ample opportunity to file the Strike Out application from 14 October 2022 onwards, yet they chose not to do so. Whether that was a strategic decision or an oversight matters not.

41      Regrettably, the decision to file the Strike Out application almost eight months after notification of the substance of the GP claim has resulted in the accumulation of unnecessary legal costs for all parties and has wasted the Court’s time and resources.

42      It is therefore not appropriate to exercise the discretion in s 570(1) of the Act.

Result

43      The application for indemnity costs is dismissed.

 

 

 

 

 

B. COLEMAN

INDUSTRIAL MAGISTRATE