Industrial Relations Commission of New South Wales CITATION: Phillip Brunt v Carlton and United Beverages Limited & Fosters People Limited [2007] NSWIRComm 197 APPLICANT Phillip Brunt PARTIES: RESPONDENT Carlton and United Beverages Limited / Fosters People Limited FILE NUMBER(S): 175 of 2005 CORAM: Sams DP Notice of motion - application for costs - lengthy litigation - application for costs of part of total proceedings - indemnity costs sought or in the alternative, party to party costs - statutory framework - s 181(2)(c) of the Act - jurisdictional gateway - discretion of the Commission - whether respondent unreasonably failed to agree to settlement of the claim - whether respondent's conduct was such as to evince an intention not to settle the proceedings on a reasonable basis - relevant period - various offers considered. CATCHWORDS: Held; offers of respondent considered in context - not unreasonable to reject first offer - subsequent offers by the applicant reasonable - respondent's offers in reply not unreasonable in context - conclusion unable to be drawn that respondent unreasonably refused to agree to a reasonable offer - respondent's conduct not such as to evince an intention to unreasonably refuse to settle the claim - jurisdictional gateway not opened - unnecessary to consider indemnity costs - application for costs refused - notice of motion dismissed - no order for costs on the motion. LEGISLATION CITED: Industrial Relations Act 1996 Bankstown City Council v Paris (1999) 93 IR 209 Carlton and United Beverages Limited v Phillip Brunt [2007] NSWIRComm 135 Carlton and United Beverages Limited v Phillip Brunt (2005) 147 IR 162 Carlton and United Beverages Limited v Phillip Brunt [2006] NSWIRComm 98 Crump & Ors v Equine Nutrition Systems Pty Ltd t/as Horsepower & Anor (No 2) [2007] NSWSC 25 CASES CITED: Four Sons Pty Ltd v Sakchai Limsiripothong (No 2) (2000) 100 IR 400 Phillip Brunt v Carlton and United Beverages Limited / Foster People Limited [2007] NSWIRComm 17 Phillip Brunt v The Continental Spirits Company [2005] NSWIRComm 1133 Phillips v Industrial Relations Commission of New South Wales (2006) 154 IR 96 Tuholi Pty Ltd v Caltex Australia Petroleum Pty Ltd (2001) 103 IR 329 Young and others v Department of Juvenile Justice [2007] NSWIRComm 142 HEARING DATES: 25 June 2007 DATE OF JUDGMENT: 13 August 2007 APPLICANT Mr S Prince of Counsel Solicitor: Mr W Szekely Szekely & Associates LEGAL REPRESENTATIVES: RESPONDENT Mr A Moses of Counsel Instructed by: Mr G Brack Australian Federation of Employers and Industries (formerly Employers First) JUDGMENT: - 19 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: SAMS DP Monday, 13 August 2007 Matter IRC 175 of 2005 Phillip Brunt v Carlton and United Beverages Limited / Fosters People Limited Application by Phillip Brunt re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION ON NOTICE OF MOTION (as to costs) [2007] NSWIRComm 197 1 This decision represents the sixth instalment in what has been a long and torturous path of costly litigation following the dismissal of Mr Phillip Brunt ('the applicant') by Carlton & United Beverages Limited / Fosters People Limited ('the respondent') almost three years ago. There have been no fewer than five substantive decisions of the Commission at single member and appellate level concerning this matter. 2 The first decision was the original decision of Macdonald C dated 26 August 2005 reinstating the applicant to his former position, but with certain conditions: See Phillip Brunt v The Continental Spirits Company [2005] NSWIRComm 1133. 3 Second, was a stay application determined by Schmidt J on 9 September 2005 arising from an appeal of the Commissioner's decision by the respondent: See Carlton and United Beverages Limited v Phillip Brunt (2005) 147 IR 162. 4 Third, the decision of the Full Bench of the Commission on 9 June 2006 which upheld the appeal by the respondent in respect to remedy only and remitted that issue to a single member: See Carlton and United Beverages Limited v Phillip Brunt [2006] NSWIRComm 98. 5 Four, the remittal decision of Sams DP on 13 February 2007 reinstating the applicant on certain conditions: See Phillip Brunt v Carlton and United Beverages Limited / Foster People Limited [2007] NSWIRComm 17. 6 Fifth, a decision of the Full Bench of the Commission on 4 June 2007 on a costs application by the applicant which was dismissed: See Carlton and United Beverages Limited & Phillip Brunt [2007] NSWIRComm 135. 7 It is ironic to note that despite being reinstated by the Commission on two occasions in August 2005 and February 2007, the applicant has now been made redundant and has left the respondent's employ. 8 This decision deals with a notice of motion filed by the applicant on 13 March 2007, pursuant to s 181(2)(c) of the Industrial Relations Act 1996 ('the Act') seeking indemnity costs or, in the alternative, party to party costs associated with the balance of the proceedings unrelated to the appeal; that is, proceedings at first instance before Macdonald C, the remittal proceedings before myself and the costs on the motion. Factual Background 9 The relevant background to this application is usefully set out in an uncontested affidavit of William J Szekely (the applicant's solicitor) dated 13 March 2007. It is noted that all offers proposed and responded to by the applicant were made in writing through his solicitor. The affidavit sets out the relevant background to this application as follows. 10 Following a formal conciliation on 2 February 2005, the applicant proposed settlement of his unfair dismissal claim by being permitted to resign and with the payment of 26 weeks compensation. The respondent rejected the offer and instead proposed the applicant be provided with assistance under the Company's Employee Assistance Program (EAP) and Outplacement Program. 11 A further conciliation conference on 4 March 2005 resulted in an offer by the applicant to settle the proceedings on the following basis: a. The termination of the Applicant's employment by the Respondent be withdrawn and the Applicant be allowed to resign; b. That the Applicant be able to avail himself of the EAP; c. The Applicant receive payment of sixteen (16) weeks on the basis that it was a bona fide redundancy; d. That this all be encapsulated in a Deed of Release reflecting a bona fide redundancy and that this effect be taken into account in relation to the Applicant's share entitlements and superannuation. 12 The respondent accepted (a) and (b) above, but rejected (c) and (d). The applicant replied by reducing the 16 weeks payment to 12 weeks and this offer was also rejected. In March 2005, the respondent proposed a payment of $2,000 and then $3,000 in May 2005, in addition to a resignation and EAP assistance. The applicant rejected the offers and reverted to his 2 February 2005 offer (26 weeks). 13 On 13 May 2005, with the hearing of his unfair dismissal application listed for June, the applicant indicated that he would not only seek reinstatement to his former position, but re-employment to a despatch position, but without his former occupational health and safety duties. The hearing of the application occurred over four days and a decision was issued on 26 August 2005. 14 Subsequently, there were various communications both by phone and in correspondence between the parties as to compliance with the orders of Macdonald C and a demand by the applicant for settlement of a foreshadowed costs application by the payment of $25,000. 15 An appeal by the respondent of Macdonald C's decision and orders was lodged on 7 September 2005 and a stay application was listed before Schmidt J on 19 September 2005. Her Honour granted the stay on terms. 16 On 23 November 2005, in the applicant's last offer before 8 February 2006 and the appeal proper, the applicant proposed settling the proceedings on the following basis: The respondent is to pay to the applicant the balance of the back pay to the date of the settlement less amounts already paid pursuant to the conditional stay; Upon the settlement, consent orders will be filed dismissing the appeal with no order as to costs, the stay is to be dissolved and effect is to be given to the terms of the orders of Commissioner McDonald (sic). Shortly after the reinstatement takes effect (1 to 2 days) the applicant will accept a redundancy offer and be paid a redundancy payment of 66 weeks' pay (based on the average weekly pay earned in the twelve months preceding the dismissal which gave rise to the proceedings). Upon the redundancy, the Trustees of the applicant's superannuation find (sic) will be advised that the applicant's employment came to an end by reason of redundancy on the date of the redundancy above and the respondent will do all things necessary to ensure that the trustees will treat the reason for the cessation of the applicant's employment upon redundancy as a redundancy. The respondent will pay to the applicant an amount equal to his costs as agreed of (sic) assessed (an indication of costs in the range of $35,000). 17 On 8 February 2006, the respondent made an offer of 12 months remuneration, $25,000 towards costs and with the applicant retaining the eight months back pay already paid. This offer became the subject of some later debate about whether it had been actually agreed to by the applicant. In any event, it was not accepted. 18 For completeness, on 16 June 2006, soon after the appeal decision, the applicant proposed settling the remitted remedy proceedings by the payment of 36 weeks pay treated as a redundancy with the applicant to retain eight months of back pay (four months of which had been paid in error) and with costs of $35,000. 19 In further conciliation proceedings on 23 June 2006, the respondent made an offer of $10,000 towards costs and with the applicant retaining the eight months in back pay. This offer was rejected and no further offers were exchanged and the remittal proceedings as to remedy commenced on 16 October 2006. 20 There were further exchanges of correspondence and listings in the Commission following my decision of 13 February 2007 reinstating the applicant on conditions. SUBMISSIONS For the applicant 21 Mr Prince commenced his submissions by addressing the decision and findings of the Full Bench in the earlier costs decision. He acknowledged that the Commission, as presently constituted, consistent with the Full Bench's decision, might limit any costs order to the period up to 8 February 2006; namely, 23 December 2004 to 8 February 2006. During this period, Mr Prince asserted that reasonable offers had been made by the applicant and refused by the respondent, thus enlivening the Commission's jurisdiction under s 181(2)(c) of the Act. The Commission could then apply the normal rules of the Commission in the exercise of discretion and the fixing of costs. 22 Mr Prince said that the offer of 16 weeks pay as a bona fide redundancy was reasonable considering the respondent's contention that it no longer had work for the applicant to undertake and the serious effect the dismissal had on the applicant's superannuation entitlements (an amount of $50,000 was in jeopardy). When this offer was rejected outright by the respondent the applicant compromised by offering 12 weeks. This too was rejected. Mr Prince submitted that this was the point at which the jurisdiction of the Commission was enlivened. Mr Prince referred to the respondent's counter offers of $2,000, then $3,000 and said it was at this point that the negotiations had effectively broken down. 23 Mr Prince relied on my costs decision in Young and others v Department of Juvenile Justice [2007] NSWIRComm 142, where an offer which was unreasonable had not been accepted. Here the offer of 12 weeks pay, with a resignation was made in conciliation and, as circumstances had unfolded, was a reasonable settlement. The second leg of the 'jurisdictional gateway' as described in Bankstown City Council v Paris (1999) 93 IR 209, related to the conduct of a party being inconsistent with an intention to settle the proceedings. However, in this case, a reasonable offer had been made which was unreasonably refused. 24 Mr Prince put that this was not a case where the applicant had insisted on reinstatement only, but had sought to compromise his claim in circumstances where he had a considerable length of service. He was not an unmeritorious applicant. His claim had been tested at every turn and he had been successful. 25 Mr Prince sought an award of costs for the entirety of the proceedings. While the respondent had had limited success in the appeal, this was not the case in the two lengthy substantive hearings in which reinstatement orders had been made on both occasions. Mr Prince submitted that even if the Commission adopted the view that 8 February 2006 was the crucial cut-off point, it would not necessarily prevent the Commission from making orders beyond that point because the Commission's discretion is at large. 26 Mr Prince agreed that the stay proceedings prior to 8 February 2006 were referable to the respondent's appeal and therefore were comprehended by the Full Bench decision. The Commission would be effectively dealing with the proceedings before Macdonald C and the remittal proceedings before the Commission as presently constituted. Mr Prince added that the material and evidence relied on in the remittal proceedings was not new and had been canvassed in the first instance proceedings. By running the case in this way, the respondent demonstrated conduct inconsistent with an intention to settle the claim. 27 Mr Prince emphasised that once the 'jurisdictional gateway' is opened it remains so for the entire proceedings. Therefore, the remittal proceedings were still part of the original proceedings. The Commission would be entitled to make a costs order for the entirety of the proceedings, except the appeal proceedings. 28 Mr Prince tendered a letter from the respondent to the applicant which indicated that he was to be made redundant on 31 July 2007. The respondent knew this was likely on 16 June 2006, but kept pursuing litigation and avoiding a settlement which ultimately proved more costly to it, than if the respondent had agreed to the earlier offers. At the time, the respondent had claimed it wasn't a redundancy, but now it has come to pass. For the respondent 29 Mr Moses, of counsel, put that Mr Prince had not articulated the precise time from which a costs order should be made. It was nonsense to put that costs would flow from the commencement of proceedings, when no offers of settlement had been advanced by either side, until 2 February 2005. 30 Mr Moses said that if there was any issue as to the conduct of the parties evincing a refusal to settle the proceedings, it was the applicant who walked away from an agreed settlement in June 2006, which included an offer to pay an overpayment, a generous monetary payment and costs. 31 Mr Moses dealt with the general principles applying to matters such as this and also relied on my conclusions in Young. The fact that the applicant was ultimately reinstated was not a precondition to an order for costs: See also Crump & Ors v Equine Nutrition Systems Pty Ltd t/as Horsepower & Anor (No 2) [2007] NSWSC 25. In this case, the applicant was found by the Commission to be a different person to what he was two years earlier. 32 Mr Moses strongly resisted the application for indemnity costs. In relying on the principles discussed in Tuholi Pty Ltd v Caltex Australia Petroleum Pty Ltd (2001) 103 IR 329, Mr Moses said that this case displayed no special or unusual features such as to warrant indemnity costs, or costs at all. The respondent had not wilfully disregarded known facts, nor established law. Mr Moses said that two questions fall to be answered in this case: 1. What offers were made by the applicant? 2. Did the respondent unreasonably fail to accept the offers? 33 Mr Moses examined each of the offers up to 8 February 2006. He said that the offer of 2 February 2005 was subject to certain conditions, including withdrawal of the termination, a resignation and 26 weeks pay. It could not be held to be unreasonable to reject such an offer in circumstances where: 1. 26 weeks is the maximum compensation that could be awarded under s 89(5) of the Act; 2. at the time the applicant had been out of work for only 1 month; and 3. the respondent held a strong view about the applicant's misconduct. 34 Moreover, the offer of 4 March 2005 ascribed to the applicant a reason for termination which it was not; that is, redundancy vis a vis misconduct. The monetary offer was still more than the period of unemployment and the respondent still held strong views as to the dismissal. The offer of 15 April 2005 was substantially the same and rejected for the same reasons. Mr Moses referred to the applicant's offer of 23 November 2005 which the Full Bench had agreed "was little more than an invitation to the appellant (the respondent here) to capitulate". 35 Mr Moses said that throughout the relevant time, the respondent had not refused to make any offers. Monetary offers were made with an emphasis on EAP assistance in circumstances where the applicant refused to seek assistance and acknowledge his unacceptable conduct. The respondent had no reason to believe he would change his behaviour. This was later acknowledged by the Commission as a significant factor in the order of re-employment. In any event, the ultimate decision was finely balanced and made on conditions. 36 Mr Moses submitted that the applicant's notice of motion should be dismissed and no order for costs be made on the motion. He said that the respondent's first reaction had been to seek its own costs on the motion as it had been improperly brought. However, he had now been instructed to seek to have this matter brought to finality. Finally, Mr Moses submitted that reliance on the applicant's recent redundancy does not assist his case. The relevant factors are those which applied at the time; not now. 37 In reply, Mr Prince submitted that there was no limitation in the relevant sections of the Act as to the time an application for costs might be assessed. Section 181(2)(c) does not govern the Commission's discretion, but simply enlivens the Commission's jurisdiction. Any offer which is reasonable, and which is rejected, enlivens the jurisdiction. Mr Prince said that, in any event, the notice of motion seeks orders from any time the Commission considers appropriate. This was not an unusual feature of costs applications. CONSIDERATION 38 There are, of course, discrete provisions which govern the power of the Commission to award costs in unfair dismissal matters under Pt 6 Ch 2 of the Act. The exercise of this function by the Commission is essentially a two stage process: See Bankstown City Council v Paris (1999) 93 IR 209 and Four Sons Pty Ltd v Sakchai Limsiripothong (No 2) (2000) 100 IR 400. 39 The first stage, which is peculiar to the unfair dismissal jurisdiction, is what has become known as the 'jurisdictional gateway'. That is, the requirement to satisfy the provisions of s 181(2)(c), which are expressed as follows: (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, 40 These particular provisions have, as their foundation, the policy intent and statutory emphasis on the settlement of an unfair dismissal claim by a dismissed employee against his/her former employer. There have been many decisions of the Commission at Full Bench and single member level which have amply demonstrated this point, including the two lead cases referred to above. 41 These authorities have also identified two bases upon which a conclusion might be reached that a party had unreasonably failed to agree to a settlement of a claim: 1. a reasonable proposal put by a party which was rejected by the other party, thus making the rejection an unreasonable failure to agree to a settlement; and/or 2. where the conduct of one party over a relevant period could be said to be conduct inconsistent with an intention to settle the proceedings on a reasonable basis: See Paris at p 219. 42 It needs to be emphasised that both parties are perfectly entitled to take and maintain firm and diametrically opposed positions as to what they expect from any settlement of the claim. For example, the applicant may insist on reinstatement and the respondent may refuse any offer of settlement. In these cases, I have often heard it referred to in conciliation as "we will not make any offer as it's a matter of principle". My response is invariably that the law books are littered with cases fought on principle, by successful, but ultimately discontented litigants. 43 That being said, the scheme of Pt 6 Ch 2 of the Act and s 181(2)(c), in particular, seeks to positively encourage settlement of unfair dismissal claims and places parties at some risk (as to costs) if they do not seriously undertake their obligation to attempt to settle a claim on a reasonable basis. The point is best exemplified by the following passage from Carlton and United Beverages & Phillip Brunt [2007] NSWIRComm 135 at para [34]: 34 We would observe that in some unfair dismissal proceedings a dismissed employee will consistently seek reinstatement (or re-employment) as the primary remedy for the alleged unfair dismissal. In these circumstances, even an apparently generous financial offer of settlement will be rejected because the employee simply wants his/her job back. Of course, a dismissed employee is perfectly entitled to maintain a steadfast desire for reinstatement, without necessarily demonstrating an unwillingness to settle the claim as contemplated by s181(2)(c) of the Act. This is because of the scheme of Pt 6 of Ch 2 of the Act and the primacy given to the remedy of reinstatement. Similarly, an employer may be entitled in appropriate circumstances to maintain a firm position of refusing to make any offers of settlement. In both these circumstances however, there is an element of risk associated when any future costs application is considered within the statutory framework. That risk was considered in Paris at page 220 where the Full Bench said: We emphasise that there will be many circumstances in which parties to litigation, including unfair dismissal proceedings, may appropriately take a firm position generally, including on the question of conciliation or settlement. Nevertheless, such a position runs significant risks in terms of the exercise of the power and discretion under s181(2)(c). This is particularly so where such a position is assumed without due regard to the policy of the Act which requires parties to take seriously their obligation to attempt to settle the proceedings. That in turn involves an obligation to consider in an objective way the strengths or limits upon the case that they will be propounding should the matter proceed to arbitration. 44 Mr Prince submitted that, in this case, the 'jurisdictional gateway' was opened as to both the rejection by the respondent of reasonable offers and by the conduct of the respondent. Mr Moses, unsurprisingly rejected both propositions. 45 At this point, I would wish to indicate that I concur with Mr Prince that the requisite 'jurisdictional gateway' will be established if, at any point in the exercise, from the point of dismissal to the conclusion of the hearing of the claim, an offer which is found to be reasonable is rejected by the other party. In other words, the exercise of discretion is, at large, when the 'jurisdictional gateway' is opened. Obviously, in this matter, the proceedings for which costs are now sought were interposed by appeal proceedings which are not relevant here. I do not think, however, that the general proposition I have just noted is adversely affected by the complications so evident in this case. However, another point of principle requires stating at this juncture. 46 The notion of what is reasonable or unreasonable will undoubtedly be a discretionary matter for the Commission to be considered in the context of the prevailing circumstances which applied at the time. It will not necessarily be a determining factor, or at all, that: 1. a party might ultimately be wholly successful in the proceedings; or 2. a monetary award by the Commission is in excess of that which was rejected; or 3. changed circumstances are relied upon to justify a party's earlier stated position. With this in mind, I agree with Hoeben J when he said in Crump that the question of whether the failure to accept an offer was reasonable has to be: "considered by reference to the situation at the time when the offer was made and not solely by reference to the ultimate outcome of the proceedings." 47 It follows that it is important to the grounding of the jurisdiction, for the Commission to be assisted by the parties as to the extent and nature of the offers and counter offers made and in the context in which they were made. In most cases, the Commission will be referred to the evidence in the substantive proceedings and/or the exchanges of offers that were made in formal conciliation proceedings or outside of the formal process. In most cases, the substance of the offers and the circumstances in which they are made will not be disputed. It is then left to the Commission to consider the reasonableness or otherwise of the offers, but at all times focusing upon ensuring justice is afforded to all parties. 48 The principles discussed in Paris were recently considered by the Court of Appeal in Phillips v Industrial Relations Commission of New South Wales (2006) 154 IR 96 where at paras [19] to [21] Mason P (with whom Spigelman CJ and Beazley JA agreed) said: 19 When the Full Bench in Paris spoke of applying the statutory criterion "objectively" it was correctly discerning that the standard of unreasonable failure was to be applied by reference to the hypothetical yardstick of the fictional "man on the Clapham omnibus" or his Australian, gender-neutral counterpart. This does not mean that this hypothetical personage is placed anywhere other than in the context of the party in question (here the party against whom costs are sought). Nor does it mean the reasonableness assessment may commit hindsight error. But it does mean that the standards of the actor in question are not determinative. Thus, in the realm of negligence law, a person's conduct may be held unreasonable even though he or she was ignorant of the circumstances calling for a particular response or even if he or she lacked the capacity to discern or provide a correct response in the circumstances. 20 Under s181(2)(c) costs may be awarded against the employer or the employee, depending on who has failed to agree to a settlement and done so unreasonably. The reference to the opinion of the Commission emphasises, if emphasis were required, that the criterion is to be decided by the Commission applying its own perception of what was unreasonable, as distinct from the perception (if any) of the party. This does not permit the Commission to ignore the standpoint or standards of the party concerned, but the Commission must not be captive to those matters. Were it otherwise, the costs discretion could not be invoked against a pig-headed litigant blinded by self-absorbed stupidity or malice. 21 I therefore cannot read the "objective" aspect of Paris as embodying a jurisdictional or other error of law in regard to the application of s181(2)(c). 49 The second stage of the process concerns the Commission's general powers to award costs in s 181(1) which are as follows: 1) Subject to the rules of the Commission and any other Act or law: (a) the Commission may award costs, and (b) costs are in the discretion of the Commission, and (c) the Commission may determine by whom and to what extent costs are to be paid, and (d) the Commission may order costs to be assessed on the basis set out in Division 11 of Part 3.2 of the Legal Profession Act 2004 or on any other basis. It is beyond doubt that these powers are both wide and discretionary. 50 It is axomatic that a failure to find jurisdiction will mean that the second stage is not embarked upon. It may be that in some particularly unusual circumstances, jurisdiction might be found, but in the exercise of discretion no order for costs will be made. 51 I turn now to consider whether the offers made and rejected during the relevant periods provide a basis for a finding under s 181(2)(c) of the Act of an unreasonable failure to settle the proceedings. 52 As a result of the costs decision of the Full Bench, (see para 6 above), Mr Prince properly conceded, in my opinion, that I might take the view that the chronology of events relevant for my consideration of this application, was up to 8 February 2006: See para 37 of Carlton and United Beverages Limited & Phillip Brunt [2007] NSWIRComm 135. I agree with Mr Prince and intend to adopt such a course. 53 Viewed in this way, the relevant period was from 2 February 2005, the date of the first conciliation, to 8 February 2006. I do not understand there to have been any offers of settlement prior to 2 February 2005. Notwithstanding that I accept that costs are sought on a discretionary basis from the commencement of proceedings until the end of the hearing of this notice of motion, except for the appeal proceedings, I do not apprehend Mr Prince to rely on the offers made by the parties subsequent to the appeal decision (9 June 2006) and prior to the hearing of the remittal proceedings (16 October 2006). See earlier paras 18 and 19. 54 The basic terms of the offers during the relevant period are summarised below: Date Applicant's Offer Respondent's Offers 2 February 2005 -Resignation -EAP Counselling -26 weeks pay as compensation -Resignation 4 March 2005 -Resignation -EAP Counselling -16 weeks pay treated as redundancy -$2,000 2 May 2005 -As above -As above except $2,000 now $3,000. -66 weeks pay treated as redundancy -36 weeks pay treated as redundancy 23 November 2005 -$35,000 in costs -4 months overpayment -$35,000 in costs 55 One can readily dispose with the offers made on 23 November 2005 by reference to para 36 of the Full Bench decision on costs. As I was a member of that Bench, I see no reason to take a different view now of what was therein expressed. That essentially leaves the offers in February, March and May 2005. 56 In my view, the applicant's offer of settlement of 26 weeks pay with a resignation was plainly an opening offer. I do not consider that it was unreasonable for the respondent to reject this offer in the following context: 1. It was the first offer advanced by the applicant; 2. The offer was only one month after dismissal; 3. The first offer was the maximum compensation that the Commission could order under s 89(5) of the Act. It is difficult to construe such an offer as one which illustrated a willingness to compromise; 4. A further conciliation conference was scheduled for 4 March 2005; 5. The respondent was entitled to consider the applicant's conduct as misconduct for which a resignation and maximum compensation would be out of the question; and 6. The respondent's reply did no more than demonstrate the not unusual circumstances that the parties were 'poles apart' at a very early stage in proceedings. 57 The applicant's two offers of 4 March and 14 April 2005 (which were essentially the same) did constitute, in my view, a reasonable offer of settlement. The applicant had been out of work for two to three months. He had compromised the initial offer in a real and material sense. Nevertheless, the question is not whether the offer was reasonable, but whether it was unreasonable for the respondent to refuse it and respond with its own offer in May. In my assessment, I do not think so, for the following reasons: 1. For the first time, the respondent recognised a monetary component of the settlement in its offer, albeit that the offer amounted to less than two weeks pay compared to 16 weeks proposed by the applicant. On any view, this still represented a significant gap between the parties. 2. The applicant maintained his position while the respondent improved on its offer, again albeit by a small margin. In other words, it could not be said that the respondent had taken a firm, steadfast or immovable position. It would seem that the negotiations continued to remain 'fluid'. 3. The offers of the applicant, for reasons which I completely understand, were couched in terms of redundancy in circumstances where the respondent's position was that the termination of employment was for misconduct. It had been prepared to accept a resignation, but it was entitled to be concerned that to elevate the termination to a redundancy (although it recognised redundancy later), would be to accept that the applicant had been completely exonerated of any unacceptable behaviour. That was certainly not how the termination of employment later came to be viewed by the Commission, either at first instance, on appeal and on remittal. 4. In my opinion, the respondent was justified in having reservations as to the applicant's conduct. As it turned out, its reservations were vindicated when it was learnt that the December 2004 incident was not the first occasion the applicant had been drinking company product on the job. In addition, the applicant was found to be less than truthful in his letter to the General Manager shortly after dismissal, in which he said he had sought counselling (for his drinking problem) when plainly he had not. 58 I find the respondent's rejections of these offers in March and April 2005 as not demonstrating an unreasonable failure to settle the claim. Nor do I consider the respondent's conduct during the relevant period was such as to evince an unwillingness on its part to settle the claim. 59 To the extent that there is any reliance on the offers made subsequent to the appeal decision and prior to the remittal proceedings, I also do not consider that the rejection of the applicant's offer was such as to enliven the Commission's jurisdiction. Conclusions 60 For the reasons herein expressed I do not consider that the applicant has established the Commission's jurisdiction as to costs as required by s 181(2)(c) of the Act. In light of this conclusion, it is unnecessary for me to consider the application for indemnity costs. The notice of motion filed by the applicant on 13 March 2007 is dismissed. I make no order for costs on the motion. Peter J Sams, AM Deputy President 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.