Renata? Selb TRF ate at Ano tale . Se Ei a et rE i OS rks eet cee a etn ap ee ne et t EKUM 'InANoGali f Or ORAL JUDGMENT IN THE FEDERAL COURT OF AUSTRALIA ) INDUSTRIAL DIVISION BETWEEN : JEFFREY LILLEY and NAURU LOCAL GOVERNMENT COUNCIL REASONS FOR JUDGMENT 21 November 1979 1979, 3 ONGY 1979 fa FECERSL ¢ Uns UF PUS RL Prt cHPAL - trent' Defendant KEELY J. This is an information laid by Jeffrey Lilley (the informant) alleging that Nauru Local Government Council (the defendant) being the employer of the informant, did on 27 October 1978: "dismiss the said Jeffrey Lilley from his employment by reason of the circumstance that: 1. he was a member of an organization, namely, the Australian Shipping Officers ' Association, an organization of employees registered under the Conciliation and Arbitration Act 1904 and the Victorian branch thereof; 2. he was entitled to the benefit of an award, namely, the Shipping Officers Award 1977, expressed to be binding upon, amongst other persons, the Nauru Pacific Shipping Line and the Australian Shipping Officers' Association and the members thereof; or both." Miss Maureen Hickey of counsel appeared for the informant and Mr Alan Stockdale of counsel appeared for the defendant. ean Ske se Leek nee aa te. ft, a ee At the conclusion of the informant's case Mr Stockdale submitted that there was no case to answer. After hearing argument from both counsel on the various matters raised and considering written submissions from each, I rejected that submission and ruled that there was evidence upon which the Court could reach the conclusion that all of the elements of the alleged offence, other than the reason alleged in the charge as being the reason for the dismissal, had been proved. The defendant called as its principal witness Mr Tamaiti Willie Star, who is both the Consul General in Australia for the Republic of Nauru and the representative in Australia of the defendant. Mr Star gave evidence that he both made the decision to dismiss the informant and in fact dismissed him, although he relied upon the defendant's Personnel Officer, Mr Grundy to advise him as to the proper procedure to be followed in effecting the dismissal including the question whether the dismissal should be without notice or by giving a payment in lieu of notice of termination. I accept the evidence of Mr Star that the informant had admitted on 27 October 1978, the day of his dismissal, that he had' said to a woman representative of the Victoria Hotel that Air Nauru had a bad name for not paying its accounts. Mr Star gave evidence that he dismissed the informant because he could "no longer rely on him to promote Air Nauru" and a telated reason that on "what he has said (he is) not suitable to continue working in that capacity or with Nauru". Mr Star stated that he was very concerned by the informant's statement to the representative that Air Nauru was getting a bad name. He also specifically denied that his decision to dismiss the informant was influenced either by the fact that the informant was a member of the Australian Shipping Officers' Association or by the fact that he was entitled- to the benefits of the Shipping Officers Award 1977. Mr Star's evidence was supported by that of Mr Kelly Emiu who is now the Nauru Consul to the Republic of China and was at the material time employed in Melbourne as a special adviser to the defendant. Mr Emiu was present throughout the conversation between the informant and Mr Star which culminated in the dismissal of the informant and his evidence supports Mr Star as to the admission made by the informant. I accept all of the evidence of Messrs Star and Emiu to which I have referred and J] reject Miss Hickey's contention that Mr Star was evasive in giving his evidence. The evidence of Mr Grundy, the Personnel Officer of tne defendant since before the time of the dismissal, supported that of Messrs Star and Emiu on a number of matters. However, their evidence was that the actual dismissal of the informant was carried out by Mr Star in the presence of Mr Emiu after the informant admitted that he had volunteered to the hotel representative that Air Nauru was getting a bad name for not paying its accounts. Mr Grundy, on the other hand, gave evidence that Mr Star had not told him that he had dismissed the informant and had told Mr Grundy to dismiss the informant if he admitted to Mr Grundy that he had mee as Se ee a w2e ort. Fat ne aetna at tenes -4~- volunteered the statement to the hotel representative. On this aspect I accept the evidence of Mr Star and Mr Emiu which gains some support from Lhe evidence of the informanL that at the end of that conversation Mr Star had said to him that "my philosphy was wrong for the company, he said I had better find another job ... I will give you two weeks to do it". Under cross examination as to that matter Mr Lilley said "He was dismissing me and giving me two weeks notice", I do not regard the differences between the evidence of Messrs Star and Emiu on the one hand and Mr Grundy on the other hand as being important for the purposes of the present proceedings. Even if the dismissal was not formally carried out until the discussion between the informant and Mr Grundy later that day, the evidence clearly establishes in my view that the decision to dismiss the informant was that of Mr Star and the reasons for that decision were those which he gave in evidence. Further, on all the evidence I have no reason to doubt Mr Star's evidence denying that the dismissal was influenced by the informant's membership of the Association or by the informant's entitlement to the benefit of the Shipping Officers Award. The evidence of Mr Grundy also specifically denied that, in deciding to dismiss the informant, the defendant was actuated by either of the reasons alleged in the information. The evidence of each of the defendant's witnesses has been the subject of detailed cross examination at considerable length, but each has maintained the denial sworn to in his evidence in chief. Section 5(4) of the Act provides that: Fo rrp = oeteeene "(4) In any proceedings for an offence against this . section, if all the relevant facts and circumstances, other than the reason or intent set out in the charge as being the reason or intent of an action _ alleged in the charge, are proved, it lies upon the person charged to prove that that action was not actuated by that reason or taken with that intent." The defendant is of course only required to satisfy the Court on the balance of probabilities as to the matters referred to in s.5(4). Assuming without deciding that the evidence before the Court establishes beyond reasonable doubt all the relevant facts and circumstances other than the reason set out in the charge as being the reason for the dismissal, I am satisfied that the defendant, in deciding to dismiss the informant, was not actuated by any of the reasons or circumstances alleged in the information. - Accordingly the information is dismissed. (After hearing argument as to costs.) Mr Stockdale on behalf of the defendant has asked for an order that the informant pay the costs of the defendant on the ground that the informant "instituted the proceedings ... ; without reasonable cause" within the meaning of s.197A of the Conciliation and Arbitration Act 1904. In the case of re Australian Conciliation and Arbitration Commission and Others; ex parte Federated Miscellaneous Workers Union of Australia (1978) 22 A.L.R. 347 at pp.349-350 Gibbs J. said: ~ M8 rete tee rok! an a "The respondent, the Australian Workers Union, has applied for costs on the ground that the proceeding was instituted by the prosecutor 'without reasonable cause' within the meaning of s.197A of the Act. 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. In the present case the argument presented on behalf of the prosecutor was not unworthy of consideration and it found some support in the two decisions of this court to which I have referred. The fact that those decisions have been distinguished, and that the argument has failed, is no justification for ordering costs in the face of the prohibition contained in s.197A." Mr Stockdale relied upon the decision of Northrop J. in Heidt v. Chrysler Australia Ltd (1976) 26 F.L.R. 257 in which case at p.271 His Honour gave a separate judgment giving reasons for ordering an unsuccessful informant in a proceeding under s.5 to pay costs. that: I agree with Mr Justice Northrop's statement at p.272 "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. ac 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." At p.274 Mr Justice Northrop, in dealing with the principle applicable to s.197A, quoted from the judgment of Barwick C.J. in General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1969) 112 C.L.R. 125 at p.138, an extensive passage which included the following passage from the judgment of uy pow eee ee on ht [Pen out st Dixon J. in Dey v. Victorian Railways Commissioners (1949) 78 C.L.R. 62 at p.91. That passage from the judgment of Dixon J. is set out at p.274 of the judgment of Northrop J. in Heidt's Case (supra) and is as follows: "But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process." In Heidt's Case (supra) Northrop J. expressed the view that a similar principle should be applied when considering the question of costs under s.197A and continued at p.274-275. Pa I quote: "Great care must be exercised to ensure that in finding that a party has instituted proceedings vexatiously or without reasonable cause, that party is not improperly deprived of his freedom from liability to pay costs to an opposing party. The test is a substantial one. In considering this matter the court must have regard to all the material properly before it. The test is not subjective to the party instituting the proceedings as at the time of the institution of the proceedings. The conduct of the opposing party prior to the institution of the proceedings may be relevant in deciding whether the proceedings were instituted vexatiously or without reasonable cause. The conduct of the opposing party both prior and subsequent to the institution of proceedings may be relevant to the discretion remaining in the court. It may be difficult to satisfy the test where disputed questions of fact arise and the proceedings eventually are dismissed because the court finds the facts adverse to the party instituting the proceedings. Where the test is satisfied, having regard to the general policy of the section, the court may, nevertheless, in the exercise of its discretion, make no order as to costs." YO In applying those principles to the facts of the matter before him and in deciding Lo order the informant in that case to pay costs, Northrop J. said, at p.275: "There was no basis whatever for claiming that he had been dismissed by reason of the circumstance that he was a member of an organization or was entitled to the benefit of an award. In evidence the informant said that he knew that the immediate reason for his dismissal was because he refused to work on a foreman team. He said also that 'he suspected there was much more', but, when asked what these reasons were he did not include as a reason that, being a member of an organization seeking better industrial conditions he was dissatisfied with his existing conditions. His suspicions were directed to matters arising when he was a shop steward. His claims were 'manifestly groundless' and were 'bad beyond argument'. In the present case I am unable to hold that the informant's institution of the proceedings was "manifestly groundless" or that his case was "bad beyond argument". Unlike Heidt's Case (supra) there is no evidence before me that the informant believed that the reason given by Mr Star for his dismissal was the only substantial reason operating on the defendant's mind in deciding to dismiss him. I am not prepared to infer such a belief from the very brief evidence of Miss Barton upon which Mr Stockdale relied that the informant told her on the day of his dismissal that he had been sacked because of his discussion with the hotel representative. Having regard to all of the evidence in the case and in the absence of evidence that the informant believed that he was dismissed for the reason given by Mr Star, I am not SanesananannS Aaa rem ney ee ey ee ee a ae Cro Sewnrenen . . ' satisfied that the informant instituted these procecdings without reasonable cause. Accordingly, there will be no order as to costs. I certify that this and the Leght preceding pages are a true copy of the Reascus for Judgment herein of his Honour Mr. Justice Mealy be. Associate Dated: 2/ november Jef