FEDERAL COURT OF AUSTRALIA Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Building and Construction Commissioner [2017] FCA 1062 File number(s): NSD 967 of 2017 Judge(s): PERRAM J Date of judgment: 5 September 2017 Catchwords: PRACTICE AND PROCEDURE – application for leave to file notice of discontinuance – whether costs order appropriate Legislation: Code for the Tendering and Performance of Building Work 2016 (Cth) s 6B(2) Federal Court Rules 2011 (Cth) r 26.12(7) Cases cited: Australian Securities and Investments Commission v Diploma Group Limited (No 3) [2017] FCA 891 El-Debel v Secretary, Department of Immigration and Border Protection [2014] FCA 474 Date of hearing: 5 September 2017 Registry: New South Wales Division: General Division National Practice Area: Employment and Industrial Relations Category: Catchwords Number of paragraphs: 7 Counsel for the Applicant: Mr T Dixon Solicitor for the Applicant: Hall Payne Lawyers Counsel for the First Respondent: Mr A Southall QC with Mr K Saeedi Solicitor for the First Respondent: Ashurst Australia Counsel for the Second Respondent: Ms L Mumme Solicitor for the Second Respondent: Johnson Winter & Slattery ORDERS NSD 967 of 2017 BETWEEN: COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA Applicant AND: AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER First Respondent UTILITIES MANAGEMENT PTY LTD Second Respondent JUDGE: PERRAM J DATE OF ORDER: 5 SEPTEMBER 2017 THE COURT ORDERS THAT: 1. Leave be granted to the Applicant to discontinue the proceeding. 2. 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 PERRAM J: 1 This morning I granted leave to the Applicant to discontinue its proceeding in this Court. Subrule 26.12(7) of the Federal Court Rules 2011 (Cth) provides that: '26.12 Discontinuance … (7) Unless the terms of a consent or an order of the Court provide otherwise, a party who files a notice of discontinuance under subrule (2) is liable to pay the costs of each other party to the proceeding in relation to the claim, or part of the claim, that is discontinued.' 2 Upon the filing of the notice of discontinuance this rule will have the effect that, unless the Court otherwise orders, the Applicant will be required to pay the Respondents' costs. I note in passing that only the First Respondent, the Australian Building and Construction Commissioner ('ABCC') sought a costs order against the Applicant at the hearing. Although the rule does not, in terms, apply to the period before the filing of the notice it is impossible to think that the outcome in that situation should be governed by some different principle: see the similar observations of Foster J in El-Debel v Secretary, Department of Immigration and Border Protection [2014] FCA 474 at [17]. The authorities in this Court establish that where leave to file a notice of discontinuance has been granted 'the starting point on the question of costs will be that the discontinuing party must pay the costs unless, for good reason shown, the Court orders otherwise': see Australian Securities and Investments Commission v Diploma Group Limited (No 3) [2017] FCA 891 at [2] per McKerracher J and the authorities cited therein. 3 In this case, good reason is shown. The underlying dispute concerns the extent to which the business of the Second Respondent, Utilities Management Pty Ltd, is to be exempted from the Code for the Tendering and Performance of Building Work 2016 (Cth) ('Building Code'). 4 On 19 May 2017, the ABCC granted an exemption from the Building Code to the Second Respondent but purported to carve out from the exemption those parts of the Second Respondent's business which consisted of the provision of services in the competitive electricity and telecommunications infrastructure market to third parties. The exemption granted by the ABCC therefore only extended to that aspect of the Second Respondent's business which was related to the operation of the South Australian power grid. 5 The Applicant ('CEPU') challenged the carve-out from the exemption and wished to see the entire business of the Second Respondent exempted from the Building Code. It argued that the carve-out was not authorised by the exemption provisions. 6 On 22 August 2017, amendments were made to the Building Code. There has been added a new s 6B(2) in these terms: '6B Exemption for essential services infrastructure Applying for exemptions … (2) The ABC Commissioner must grant the exemption (the infrastructure exemption) if the Commissioner is satisfied that: (a) the principal business of the building contractor or building industry participant involves performing work for the provision of essential services related to supply of electricity, natural gas, water, waste water, or telecommunications; and (b) the principal building work of the building contractor or building industry participant involves performing work for the provision of essential services infrastructure. …' (emphasis in original) 7 The Second Respondent has agreed to apply for an exemption under this new provision. That being so, the validity of the exemption flowing from its earlier application has no ongoing relevance. The proceedings have been overtaken by events for which no one is responsible. The appropriate order is that there be no order as to costs which is the order I made this morning. The ABCC argued that the CEPU's conduct of the proceeding had been unreasonable; that a large and unnecessary affidavit had been prepared; and that excessive allegations were initially pursued. The difficulties were eventually addressed in ways which did not call for adjudication. I do not consider that I should now seek to work out whether the complaints were well-founded or not. A determination of those matters would be largely guesswork on my part until such time as the action was tried. Since that will not now occur I see no secure basis upon which it would be wise to make such an uninformed guess. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perram. Associate: Dated: 5 September 2017