FEDERAL COURT OF AUSTRALIA JKC Australia LNG Pty Ltd v Maritime Union of Australia [2016] FCA 497 File number: NTD 33 of 2015 Judge: WHITE J Date of judgment: 3 May 2016 Catchwords: COSTS – application for costs governed by s 570 of the Fair Work Act 2009 (Cth) – Court's discretion to award costs – whether costs incurred by unreasonable act or omission of applicant – applicant delayed efficient disposal of proceeding and necessitated an otherwise unnecessary hearing. Legislation: Fair Work Act 2009 (Cth) ss 484, 505, 570 Federal Court Rules 2011 (Cth) r 26.12(7) Fair Work (Registered Organisations) Act 2009 (Cth) Date of hearing: 3 May 2016 Registry: Northern Territory Division: General Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 24 Counsel for the Applicant: Mr C Murdoch Solicitor for the Applicant: Norton Rose Fulbright Counsel for the Respondent: Mr LS Reidy Solicitor for the Respondent: CRH Law ORDERS NTD 33 of 2015 BETWEEN: JKC AUSTRALIA LNG PTY LTD Applicant AND: MARITIME UNION OF AUSTRALIA Respondent JUDGE: WHITE J DATE OF ORDER: 3 may 2016 THE COURT ORDERS THAT: The Applicant pay the Respondent's costs of, and incidental to, today's hearing. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. EX TEMPORE REASONS FOR JUDGMENT WHITE J: 1 The applicant (JKC) has given notice that it intends to discontinue its action. The respondent (MUA) consents to that course and the notice of discontinuance will be filed by close of business on Friday, 6 May 2016. 2 The sole remaining issue is the question of costs. Rule 26.12(7) of the Federal Court Rules 2011 (Cth) provides, that unless the terms of a consent or an order of the Court, provide otherwise, a party who files a notice of discontinuance under subr (2) is liable to pay the costs of each other party to the proceeding in relation to the claim that is discontinued. 3 Having regard to that rule, JKC makes an oral application for an order that there be no order as to costs. The MUA opposes an order to that effect and contends instead that JKC should pay its costs of and incidental to the hearing today. It does not seek an order for costs in relation to the proceedings more generally. 4 The underlying proceedings concerned the jurisdiction and power of the Fair Work Commission (FWC) under s 505 of the Fair Work Act 2009 (Cth) (the FW Act). In particular, they raised the question of whether it is within the jurisdiction of the FWC to order that a permit holder of a named union is entitled to enter particular premises for the purposes specified in s 484 of the FW Act. 5 JKC is the principal contractor on the Ichthys LNG Project at Blaydin Point in the Northern Territory (the Project). The Module Offloading Facility (MOF) forms part of the Project. Until 18 April 2016, a form of transition pontoon known as the ALE Heavy Lift Hydro Deck (Hydro Deck) was secured to the MOF. 6 The MUA is an organisation registered pursuant to the Fair Work (Registered Organisations) Act 2009 (Cth) (the FWRO Act). Mr Mayor, who is the Secretary of the North Territory Branch of the MUA, wished to enter the MOF and the Hydro Deck in the exercise of rights of entry under Pt-3-4 of the FW Act. JKC refused him entry. It did so because it took the view that the MUA was not entitled to represent the industrial interests of any of the workers on the MOF or the Hydro Deck and, accordingly, that Mr Mayor could not enter those premises for the purpose contemplated by s 484. 7 Mr Mayor having been refused entry, the MUA lodged an application with the FWC for it to deal with a "right of entry" dispute pursuant to s 505 of the FW Act. By the application, the MUA sought orders as follows: (1) That a permit holder of the MUA is entitled to enter the premises of the respondent at the Darwin INPEX Project Module Offloading Facility for the purpose of holding discussions with one or more of the employees engaged at the premises should they wish to participate; (2) That a permit holder of the MUA is entitled to hold such discussions in the room ordinarily used by workers to have their meals and other areas at which workers take their breaks; (3) Such other orders as the Commission considers necessary to prevent further disputes in connection with the future entry to the premises by the applicant's officers. 8 JKC commenced the present proceedings on 16 June 2015. By its amended application, it sought from this Court a declaration in the following terms: The Fair Work Commission does not have jurisdiction to, by arbitration under s 505 of the Fair Work Act 2009 (Cth), make an order in proceeding Re: 2015/367 between the Maritime Union of Australia (MUA) and JKC Australia LNG Pty Ltd (JKC) declaring that an official of the MUA who is a holder of a permit issued under Division 6 of the Part 3-4 of the Act has an entitlement to enter the premises of JKC at the Darwin INPEX Project Module Offloading Facility under s 484 of the Act. 9 The FWC conducted a hearing of the MUA application on 1 and 2 July 2015. By an interim decision delivered on 20 October 2015, the FWC said that it was not prepared to determine the MUA application until it had further particularised its claims and had given notice of the application to other organisations which may have industrial coverage of the employees in question. 10 The trial in the present action took place on 24 November 2015 and the Court reserved its decision. The Court was preparing to deliver judgment in early April 2016. 11 The Court then became aware that the FWC had delivered a decision on 20 January 2016 in which it had upheld the MUA claims with respect to employees on the Hydro Deck and had made orders as follow: (1) A permit holder of the Maritime Union of Australia (MUA), in accordance with s 484 of the FW Act, may enter the ALE Hydro Deck secured to the Module Offloading Facility located at the Ichthys Liquefied Natural Gas Project site, Blaydin Point, Darwin Harbour for the purpose of holding discussions with non-management employees who perform work on the ALE Hydro Deck and who wish to participate in those discussions. (2) Should the MUA wish to enter the premises, it must do so in accordance with Division 6, Pt 3-4 of the Fair Work Act. (3) This Order will operate on and from 20 January 2016. 12 My Associate corresponded with the parties on 7 April 2016 inquiring whether, in light of the Commissioner's decision of 20 January 2016, the matters agitated at the hearing on 24 November 2015 had become moot, whether the Court's decision was still necessary, whether JKC was proposing any further amendment to its application and whether either party wished to make further submissions or to provide further evidence. On 21 April 2016, the parties informed the Court that they have been unable to reach agreement about these matters and proposed a regime (extending over five weeks) for an exchange of written submissions for the Court's consideration. 13 I took the view that the regime proposed by the parties would prolong the determination of the proceedings unnecessarily and, accordingly, the parties were advised on 26 April 2016 that the Court would hear today oral submissions on the matters raised by my Associate's email. On 29 April 2016, each of the parties filed an outline of the submissions it intended to make. By their respective submissions, JKC contended that it was still appropriate for the Court to make orders on its application, whereas the MUA contended that an order was no longer necessary and, indeed, would be inappropriate. 14 Both parties referred in the submissions to a further development which I have not yet recounted. That is that the charter of the Hydro Deck had ceased on 11 April 2016 and that the Hydro Deck had been removed from the MOF on 18 April 2016. In fact, JKC had given notice to the charterer back on 14 February 2016 that it would not be renewing the charter. The removal of the Hydro Deck meant that the proceedings before this Court became effectively moot. 15 Both parties recognised that the exercise of the Court's discretion in the present case is governed by s 570 of the FW Act. 16 It was common ground that JKC had first informed the MUA about one hour before the commencement of today's hearing of its intention to discontinue the proceedings. I add that the Court was given no forewarning at all of the proposed discontinuance. 17 The MUA seeks the order for costs on the basis that it had been unreasonable, in terms of s 570(2)(b) of the FW Act, for JKC to have delayed its decision concerning discontinuance until an hour or so before the commencement of today's hearing. 18 I consider that there is considerable force in that submission, for the following reasons. First, once the FWC handed down its decision on 20 January 2016, it was appropriate for the parties, and in particular JKC as the applicant, to have informed the Court of that change in the circumstances of the subject matter of its application. At the hearing, it had sought relief in respect of foreshadowed action by the FWC but the FWC decision meant that the action was no longer foreshadowed but actual. Further, and in any event, the terms of the orders made by the FWC differed from the terms of the orders which the MUA had sought in its application. They also differed from the terms of the order in respect of which JKC had sought relief from this Court. That had the consequence that, if the Court had made a declaration in the terms sought by JKC in its application, it would have been hypothetical or, at least, of limited practical utility. 19 Had JKC brought the matter to the Court's attention following the decision of the FWC on 20 January 2016, I consider it likely that the issues arising from the removal of the Hydro Deck from MOF would have come to the fore at a much earlier stage. That is because it is probable that JKC would have recognised the appropriateness of informing the Court not only of the FWC decision but also of the foreshadowed departure of the Hydro Deck. 20 Secondly, when JKC gave notice to the charterer of the Hydro Deck that the charter would not be renewed, it was again appropriate for it to bring this change of circumstance to the attention of the Court. Counsel submitted that JKC had not done so because it had taken the view that the position, in so far as it concerned these proceedings, had not changed. I accept that JKC may have held that view but do not consider that it was reasonable for JKC to suppose that its own view would necessarily be shared by others, let alone be conclusive. 21 Thirdly, I take the view that JKC should have been alerted to the need to give attention to the position by my Associate's email and yet, as late as 21 April 2016 and again on 29 April 2016, it indicated to the Court and to the MUA that it pressed for the orders sought in its amended application. 22 Fourthly, JKC should have been alerted again by the correspondence from Mr Quinn, the MUA solicitor, dated 27 April 2016, in which Mr Quinn suggested that the need for a hearing today could be averted by JKC agreeing to discontinue the proceedings on the basis that there be no order as to costs. JKC rejected that proposition and both parties then had to prepare for today's hearing. 23 Mr Murdoch has said today all that could be said by way of defence of the JKC position. However, on my assessment, there is no justification for JKC not having appreciated much earlier that it was appropriate for it to discontinue the proceedings in the circumstances that now exist, especially since the departure of the Hydro Deck from the MOF. Had JKC given appropriate attention to the matter earlier, today's hearing would not have been necessary. I consider that its failure to give the matter prompt attention and to reach the decision about discontinuance earlier was an unreasonable act and, accordingly, that the discretion to which s 570(2) of the FW Act refers is enlivened. It is appropriate that JKC pay the MUA's costs of and incidental to today's hearing. 24 The order of the Court with respect to costs is that the applicant, JKC Australia LNG Pty Ltd, pay the respondent's costs of and incidental to today's hearing. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice White. Associate: Dated: 10 May 2016