Theodore Geros v Professional Steering & Suspension Centre [1995] IRCA 668

INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 3388 of 1995 B E T W E E N : THEODORE GEROS Applicant AND PROFESSIONAL STEERING & SUSPENSION CENTRE Respondent Before:Judicial Registrar Murphy Place: Melbourne Date: 12 December 1995 EX-TEMPORE REASONS FOR JUDGMENT Before the Court are two applications. The first is an application by the Respondent that the solicitors for the Applicant pay the costs thrown away as a result of the failure of the Applicant or his solicitors to appear when the matter was listed for hearing on 4 December. The second application is that the Applicant pay the costs of the proceeding on the basis that the proceeding, having been dismissed, was instituted "vexatiously or without reasonable cause", pursuant to Section 347 of the Industrial Relations Act 1988 ("the Act"). Costs against practitioners. In Canceri v Taylor (1994) I IRCR 120 the Court confirmed its inherent power, subject to Section 347 of the Act, to order costs against practitioners. The present application against the Applicant's solicitors arises out of the fact that neither the Applicant nor his solicitors attended Court when the matter was listed for hearing on 4 December. On that day the Court received by facsimile a letter purporting to be a notice of withdrawal of practitioner. An affidavit from the solicitors for the Applicant sworn 11 December 1995 deposes that instructions were received from the Applicant shortly prior to the hearing date that a notice of discontinuance be filed, but this was not done by the solicitors. No explanation was provided by the solicitors for the Applicant as to why there was no proper application under Order 45 Rule 7 of the Rules of Court to withdraw as a practitioner. The result of the failure of the Applicant or his solicitors to appear on 4 December was that the solicitors for the Respondent and the Respondent were forced to the expense of preparing for the trial and then having the matter adjourned to this day to allow them to make a costs application. The Court is satisfied that the solicitors for the Applicant should pay the costs thrown away by reason of their failure to appear. The costs sought are counsel's fees, witness expenses and solicitors costs and I fix them at $2466. Were the proceedings instituted vexatiously or without reasonable cause? Counsel for the Respondent relied on the test outlined by Wilcox J, as he then was, in Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257, 264. This case requires the Court to look at the position from the point of view of the Applicant at the time the proceedings were instituted, and to ask whether, "on the Applicant's own version of the facts, it is clear that the proceeding must fail." The Court heard evidence from Mr William Rolfe ("Rolfe"), the Managing Director and owner of the Respondent, that the Applicant, at the time he sought employment, had proffered to him a reference that he had been employed by another company making or rebuilding transmissions for a period of some 14 months. The Court has before it a decision, in another proceeding instituted by the Applicant, in the matter of Geros v Mitcham Automatics Victoria Proprietary Limited (Industrial Relations Court of Australia, Millane JR, 10 November 1995). In that decision the Court records that the Applicant in his evidence in chief admitted that the 14 month period referred to in that reference was false and that he only worked with that company for a period of seven weeks. Rolfe gave evidence that he relied on that document when agreeing to employ the Applicant. He gave evidence that power steering work is much simpler than working on automatic transmissions and that if the Applicant was skilled in automatic transmission work he would easily be able to work on power steering units. At the interview the Applicant was told that he would be on trial for a few days. In cross-examination Rolfe said that the trial period may have been for a week. After two days Rolfe and the Applicant discussed extending the trial period for a period of a month as the Applicant was having difficulty learning the work. After two weeks the Applicant was still not performing. He was causing loss to the Respondent by reason of damage to units he was working on. On 7 June this year his employment was terminated. After he was told he would be terminated the Applicant abused Rolfe. This abuse was repeated the next day and included various threats. The Court is required to determine whether it is proper to characterise these proceedings as instituted without reasonable cause on the basis of the material known to the Applicant at the time he issued the proceedings. The Court is satisfied that it is proper to admit, pursuant to Section 157 of the Evidence Act 1995 (Commonwealth), the decision of Judicial Registrar Millane in Geros (above). That decision records admissions by the Applicant in those proceedings as to the falsity of the reference. Also in the decision is a finding of the falsity of the reference. The Applicant did not attend these proceedings to contest the application for costs. The Court draws an inference against him pursuant to Jones v Dunkel (1959) 101 CLR 298 on his failure to attend and/or give any reason for his failure to attend. Further, the Court is satisfied on the evidence of Rolfe that the Applicant was on a period of probation and thus excluded from the provisions of Division 3 of Part VIB of the Act under Regulation 30B of the Industrial Relations Regulations. Regulation 30B(1)(c) requires a period of probation to be determined in advance and reasonable. The Court rejects the argument that the period was not determined in advance. The evidence of Rolfe was that it was for a few days or a week. This is a period determined in advance and is reasonable in the circumstances. The period was extended by agreement between the parties for a month. This evidence of Rolfe was not contested. The Applicant was thus excluded under Regulation 30B. Further, the Applicant's false representation in the reference that he proffered to Rolfe when he sought employment showed that the Respondent, had it known of the falsity of the reference, would have a valid reason to terminate his employment. That reason was his misrepresentation as to his skill. The Respondent could not have known of the reason at the time but was entitled to rely on that reason in these proceedings: Lane v Arrowcrest Group Pty Ltd (1990) 27 FCR 427, 456 (Approved in the recent High Court decision: Byrne v Australian Airlines Limited (1995) 131 ALR 422, 463 per McHugh and Gummow JJ). Having regard to all these matters it is proper to regard these proceedings as having been instituted without reasonable cause. The case thus falls within the exceptional circumstances discussed in Thompson v Hodder (1989) 29 IR 339, 341. The Court proposes to order that the Applicant pay the costs of the proceeding and fixes them at $2016. MINUTES OF ORDERS THE COURT ORDERS THAT: 1. Messrs Testart, Robinson and Pitts, Solicitors of 701 Station Street, Box Hill pay to the Respondent the sum of $2466 within 28 days. 2. The Applicant pay the Respondent's costs of the proceeding fixed at $2016 within 28 days. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. I certify that this and the preceding four (4) pages are a true copy of the reasons for judgment of Judicial Registrar Murphy. Associate: Dated: Solicitor for the Applicant: Mr A Cheevers from Messrs Testart, Robinson & Pitts Registered Organisation for the Respondent: Victorian Automobile Chamber of Commerce Counsel for the Respondent: Mr G Devries Date of hearing: 12 December 1995 Date of judgment: 12 December 1995