Industrial Relations Commission of New South Wales CITATION: Video Intercom Pty Limited v. George Sukkar [2006] NSWIRComm 1120 APPLICANT Video Intercom Pty Limited PARTIES: RESPONDENT George Sukkar FILE NUMBER(S): IRC 6200 of 2005 CORAM: Connor C CATCHWORDS: application for costs - pending appeal proceedings - claim for unfair dismissal rejected - proceedings adjourned LEGISLATION CITED: Industrial Relations Act 1996 Attorney General v. Wentworth (1988) 14 NSWLR 491 CASES CITED: General Steel Industries Inc v. Commissioner for Railways (1964) 112 CLR 125 Lewis v. Kunama Securities Pty Limited - unreported Luke v. Handicapped Children's Centre - unreported HEARING DATES: 25/07/2006 DATE OF JUDGMENT: 07/25/2006 EXTEMPORE JUDGMENT DATE : 07/25/2006 APPLICANT Shaun Schmitke Employers First LEGAL REPRESENTATIVES: RESPONDENT Geoff Phillips DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: CONNOR C Tuesday, 25 July, 2006 Matter No IRC 6200 of 2005 Video Intercom Pty Limited and George Sukkar Application for costs under S.181 of the Industrial Relations Act, 1996 INTERLOCUTORY DECISION [2006] NSWIRComm 1120 1 On Wednesday, 7 June, 2006 I handed down my decision on an application made by George Sukkar under Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act. Mr Sukkar had been employed from Monday, 11 October, 2004 until his services terminated on Monday, 14 November, 2005. He argued that he had been dismissed by Video Intercom but in my decision I concluded that, in fact, Mr Sukkar had brought his contract of employment with Video Intercom to an end himself. He had been offered alternative employment, commensurate with an injury he had sustained in the course of his employment and which I considered to be suitable for him but which he had rejected consistently both before the proceedings commenced and during the conciliation phase of the matter. 2 I commented in my decision (at pp.19 and 20) that: "...in this case, as far as I can see, Mr Sukkar was not being reduced in rank or receiving a lesser remuneration... An employer is always entitled to retain the right to move staff to other positions within its organisation within the range of work expected of that staff. Mr Sukkar was appointed initially by Video Intercom as a technical support engineer. He was subsequently promoted to the position of installations manager but the job offered to him of installations technician, as I see it, was consistent with his original contract of employment with Video Intercom. It was only a temporary measure, in any event, consistent with his return to work programme following his injury. Mr Sukkar may have had some expectation that he may be appointed to the position of service technician in due course, but any promise that had been made to him in that respect would have to be conditional upon his being qualified to perform the work in question. At the time of the termination of his services that was not the case..." In those circumstances I saw no grounds for my intervention in support of Mr Sukkar and I dismissed his Part 6 application. 3 Video Intercom had foreshadowed an application for costs against Mr Sukkar and I reserved its position in that respect. On Friday, 16 June, 2006 a notice of motion was filed by Employers First on its behalf in support of a costs application. I set the matter down for a hearing on the question of costs on Tuesday, 25 July, 2006. However, on Tuesday, 27 June, 2006 Mr Sukkar lodged an appeal against my decision and I understand that appeal is set down for hearing before a Full Bench (Wright J - President, Walton J - Vice President and Harrison DP) on Wednesday, 8 November, 2006. On Monday, 24 July, 2006 Employers First wrote to me, indicating that it was: "...of the view, particularly in light of other proceedings afoot, that the hearing on notice of motion be adjourned until the outcome of the appeal proceedings is determined. We suggest that this is an eminently sensible course for the Commission to adopt in the interests of efficient disposal of all matters arising from the decision of the Commission on Wednesday, 7 June, 2006. Submissions to the effect outlined herein shall be made before the Commission..." In the proceedings on Tuesday, 25 July, 2006 Mr Schmitke represented Video Intercom and Mr Phillips represented Mr Sakkar. 4 Whilst I concluded that it was open to me to proceed at this time to determine the cost application lodged on behalf of Video Intercom, I did not believe that it was appropriate to do so. The pending appeal proceedings must have an impact in the cost application and it would serve no good purpose to proceed to determine the cost application until the ultimate outcome of the appeal before the Full Bench. Indeed, the appeal itself may give rise to a cost application. However, I do propose to make the following observations on the cost application to assist the parties in resolving all issues between them. 5 S.181 deals with the question of costs in general in all proceedings before the Commission and, in particular, S.181(2) which restricts costs in all matters before a single member of the Commission, viz: "However, the Commission when it is not in Court Session may award costs only in the following cases: (a) the Commission may award costs against an applicant if it considers that the application to it was frivolous or vexatious, or (b) the Commission may award costs against a party to proceedings who, in the opinion of the Commission, instituted proceedings without reasonable cause, or (c) the Commission may award costs against a party to proceedings under Part 6 of Chapter 2 (Unfair dismissals), who, in the opinion of the Commission, unreasonably failed to agree to a settlement of the claim or whose application was frivolous or vexatious, or (d) the Commission may award costs in proceedings for a breach of an industrial instrument or the recovery of money under Chapter 7, as provided by Ss.357 and 373." Video Intercom proposes to argue its claim for costs under S.181(2)(c), ie that the application was frivolous or vexatious and that Mr Sukkar had unreasonably failed to agree to a settlement of a claim that I had ultimately determined as reasonable. The notice of motion filed for Video Intercom also refers to S.181(2)(a) - which also concerns frivolous or vexatious applications - and S.181(2)(b) - where the proceedings were instituted without reasonable cause. 6 I do not believe that Ss.181(2)(a) or (b) are applicable for costs against Part 6 applications. In my opinion, cost applications for Part 6 proceedings are confined to S.181(2)(c) alone. In that respect, in my unreported supplementary decision of Tuesday, 13 May, 1997 in Lewis v. Kunama Securities Pty Limited [Matter No. 6035 of 1996 at p.3] I commented: "…it is an established rule of construction for statutes and instruments that any provisions of a general application give way to specific provisions - generalia specialibus non derogant. I read S.181(2)(c) as a separate head and any application for costs in Part 6 proceedings is confined to it alone…" The notice of motion filed on behalf of Video Intercom suggests that, as I concluded in my decision of Wednesday, 7 June, 2006, there was no dismissal of Mr Sukkar by Video Intercom, it opens up Ss.181(2)(a) and (b) for the cost application made. As far as S.181(2)(a) is concerned, it is in similar language to S.181(2)(c) and adds nothing to the claim for costs. But, in any event, I regard the submissions made on behalf of Video Intercom in that respect to be pure sophistry. It is sufficient that the claim is made under Part 6, whether or not it had merit or was strictly within jurisdiction, to confine any application for costs to S.181(2)(c) alone. 7 A frivolous or vexatious action under S.181(2)(c) is confined to litigation where the party bringing it is not acting in good faith and merely seeks to annoy or embarrass an opponent or which is not designed to produce any practical result. Roden J of the State Supreme Court in Attorney General v. Wentworth (1988) 14 NSWLR 491 held that a proceeding was vexatious if it was instituted with the intention of annoying or embarrassing a respondent, if it was brought for collateral purposes and not for having the court adjudicate on the issues or, irrespective of motive, it was so obviously untenable or manifestly groundless as to be utterly hopeless. Barwick CJ of the High Court in General Steel Industries Inc v. Commissioner for Railways (1964) 112 CLR 125 explained the test (at p.129) in the following terms: "...At times the test has been put as high as saying that the case must be so plain and obvious that the court can say at once that the statement of claim, even if proved, cannot succeed; or '...so manifest on the view of the pleadings, merely reading through them, that it is a case that does not admit of reasonable argument...': '...so to speak apparent at a glance'…" Therefore, in order to bring a case within the description of frivolous and vexatious it is not sufficient merely to say that the applicant has no cause of action. It must appear that the cause of action is, on the face of it, clearly one which no reasonable person could properly treat as bona fide and contend that he has a grievance which he was entitled to bring before the court. 8 The other head under S.181(2)(c) is "...an unreasonable failure to settle a matter...". All the circumstances surrounding the dismissal should be taken into account. It must be remembered that any party has a right to have his case presented in court without compromising it in any manner. As I indicated in my unreported supplementary decision of Wednesday, 4 May, 1994 in Luke v. Handicapped Children's Centre [Matter No. IRC 2586 of 1994 at p.5]: "…an order for costs on the grounds of an unreasonable failure to settle the matter should be contemplated only where there is such an obdurate refusal to participate in the discussions that there has been a total frustration of the conciliation process…" 9 In other words, I regard S.181(2)(c) as a particularly limited field for the awarding of costs and the parties should give further consideration to their respective position over these unresolved matters. I propose to adjourn these proceedings for mention on Wednesday, 2 August, 2006 to give the parties the opportunity to review their respective positions. P J CONNOR Commissioner DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.