Industrial Relations Commission of New South Wales CITATION: Jian Ping Qian v Brighton Australia Pty Ltd [2006] NSWIRComm 1174 APPLICANT Jian Ping Qian PARTIES: RESPONDENT Brighton Australia Pty Ltd FILE NUMBER(S): 6097 of 2005 CORAM: Macdonald C CATCHWORDS: Unfair dismissal application - jurisdiction raised during conciliation - hearing programmed on jurisdiction - notice of motion filed by Respondent - costs sought by Respondent - hearing on notice of motion - Ex Tempore decision in favour of Respondent on jurisdiction - costs application considered - frivolous and vexatious found - costs ordered on a limited basis. LEGISLATION CITED: Industrial Relations Act 1996 Abraham and Anor v Bank of New Zealand (1996) ATPR 41-507 CASES CITED: Copperart Pty Ltd v Martin (1996) 68 IR 58 Mervat Wahba & Miles Fresh Food Market Trading as Brighton Fruit Farm Pty Limited (1999) NSWIRComm 329 Peden v Lake Macquarie Generation Pty Limited [2004] NSWIRComm 66 HEARING DATES: 08/03/06 DATE OF JUDGMENT: 12/14/2006 APPLICANT Jing Ping Qian, self-represented LEGAL REPRESENTATIVES: RESPONDENT Mr P Tiernan, solicitor DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: MACDONALD C 14 December 2006 Matter No IRC 6097 of 2005 Jian Ping Qian and Brighton Australia Pty Ltd. Application by Jian Ping Qian re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION [2006] NSWIRComm 1174 1 This Decision concerns an application made by an employer (Brighton Australia Pty Ltd) against a former employee (Jian Ping Qian). 2 The application is a Notice of Motion filed by the employer and which seeks the following: (a) The employee's unfair dismissal application be dismissed for want of prosecution; and (b) The employee pay the employer's costs pursuant to s181 of the Act. BACKGROUND 3 Mr Jian Ping Qian filed an unfair dismissal application on 24 November 2005. He named his employer as Brighton Australia Pty Ltd. 4 The employer put on a response to the unfair dismissal application. That response comprised documentation pertaining to an unfair dismissal application made up of this state industrial relations tribunal and the federal industrial relations tribunal. 5 The unfair dismissal application came before Cambridge C on 16 December 2005 for Conciliation and Directions. Mr Jian Ping Qian appeared unrepresented. The employer was represented by Mr P Tiernan, solicitor. 6 The matter was set down for Mention and Directions on 23 January 2006. The employee appeared unrepresented. An interpreter was present to assist him. The employer was again represented by Mr Tiernan. The matter was programmed for a Hearing on a threshold issue, being the "question of jurisdiction". Mr Tiernan's opening submissions of 23 January went to the Applicant's employment being governed by a federal collective bargaining agreement in conjunction with a named national award. 7 Cambridge C programmed the matter for a determination on the threshold issue of jurisdiction in accordance with Practice Direction 17. As the employer was agitating that there was a threshold issue, then the employer was required to file its relevant material firstly (3 February 2006); thence the employee (24 February); and finally the employer in reply (3 March). 8 By correspondence, dated 3 February 2006, Mr Tiernan wrote to The Registrar of this Commission, giving advice of a Notice of Motion to strike out the employee's unfair dismissal application. The covering letter of the above date and supporting documentation had been facsimiled to The Registrar. The covering letter does not state that a copy has been forwarded to the Applicant. 9 A Notice of Motion was filed by the employer's law firm on 8 February 2006. The Notice of Motion set out the following: (a) The employee's unfair dismissal application be dismissed for want of jurisdiction; and (b) The employee pay the employer's costs pursuant to s181 of the Act. The Notice of Motion was forwarded to Walton J., Vice President for his consideration and returned then to the Registry. There is a Registry file note that a Mandarin interpreter will be required. 10 The file then came on before Deputy Registrar Anastasi on 14 February. There was no appearance by the employee. Mr Tiernan appeared for the employer. 11 The transcript of discussion between the Deputy Registrar and Mr Tiernan establishes that the threshold issue of the employee having allegedly filed in the wrong jurisdiction is set for a Hearing on 8 March. The Deputy Registrar was not able to provide a hearing date for the Notice of Motion prior to 8 March. Accordingly, that date was selected for the hearing on the Notice of Motion and that Notice of Motion would be dealt with first - that is, before the threshold Hearing on the alleged wrong jurisdiction issue. Finally, the Deputy Registrar states that the employee will be advised by the court of the listing of the Notice of Motion for 8 March. 12 The Notice of Motion was dealt with on 8 march 2006. The employer was represented by Mr Tiernan. The employee remained unrepresented. He was assisted during the proceedings by an interpreter. Evidence was given in the proceedings by Mr R Gavran, director. At the conclusion of the proceedings, the Commission issued an Ex Tempore Decision which found that the employee had his conditions of employment governed by a federal industrial instrument. The Commission, however, reserved its decision in respect of the costs application by the employer. The Commission directed Mr Tiernan to provide to the Commission and the employee, a formal document setting out the costs being sought. 13 By correspondence of 16 March 2006, Mr Tiernan set out the information sought by the Commission. 14 The Commission received correspondence from the employee. The letter bears a Registry stamp of 31 March 2006. The employee advised that he had received a letter from the Australian Industrial Relations Commission ("the AIRC") on 16/03/2006 to say that his unfair dismissal was dismissed by the AIRC for being lodged out of time. He also stated that he should not have to pay compensation to his employer because it was not his fault that the application was lodged before the "IRC of New South Wales". That is, the "IRC of New South Wales" had accepted his unfair dismissal application and, by implication, it should not have so accepted as he was covered by a federal instrument. As the AIRC had rejected his application, he asked that the "IRC of New South Wales" consider his application again. 15 The Commission received a Notice of Discontinuance on behalf of the employee, filed on 5 May 2006. CONSIDERATION 16 This Decision concerns an application for costs by the employer against the former employee. The costs application is made in the context where the unfair dismissal application proceeded to a Hearing and the Commission determined that the employee had his conditions of employment determined by a federal industrial instrument. In other words, this State Commission lacked jurisdiction to deal with the unfair dismissal application. The Applicable Statutory Law 17 The employer applied for an order that the employee pay its costs pursuant to: "Section 181(1)(a), 181(1)(b) and or 181(2)(a), 181(2)(b) or 181(2)(c) of the Act." (emphasis added) (Per correspondence of Mr Tiernan, dated 16 March 2006 - "the Tiernan correspondence"). 18 The Commission needs to comment on the foregoing extract from the Tiernan correspondence. 19 The Commission has given emphasis to "and or". The Commission did so because a costs application arising out of an unfair dismissal application is not based, at law, on an "or" basis - that is on s181(1) or s181(2). 20 A cost application is based on both s181(1) and s181(2). Even that statement by the Commission needs further refinement but suffices to make the point that there is no "or" basis for the making of a costs application. 21 The Commission stated above that a certain pronouncement needed further refinement. The Commission had stated that a costs application is grounded on both s181(1) and s181(2). The further refinement correctly states the basis of a costs application as: s181(1)(a) and (b) and s181(2)(c): Peden v Lake Macquarie Refrigeration Pty Limited [2004] NSWIRComm 66 at para 14 (Wright J, President, Walton J. Vice-President, Macdonald C) ("Peden's Case")Thus: " 181 Costs (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 ………………………… (2) However, the Commission when it is not in Court Session may award costs only in the following cases: …………………………… (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 ….." 22 The foregoing Full Bench decision makes it clear that the only costs ground available for an unfair dismissal application, is that found in s181(2)(c). Accordingly, a costs application pursuant to s181(2)(a) and s181(2)(b), per the Tiernan correspondent, is not available to the employer against the employee. Ground(s) for Costs Application 23 Section 181(2)(c) sets out three grounds for a costs application: (a) one party failed to agree to a settlement; (b) the unfair dismissal application was frivolous; (c) the unfair dismissal application was vexatious. The Tiernan correspondence does not state which ground(s) is/are relied upon to ground the employer's application for costs. 24 The transcript for the Hearing on the Notice of Motion shows that Mr Tiernan put a submission as to costs and that the circumstances he relied upon to ground the costs application, were described as "circumstances that border on frivolous or vexatious" (Tr. 08/03/06 - p14, line 18) Accordingly, the Commission will consider the employer's cost application on the grounds of frivolous or vexatious. 25 The thrust of the employer's submission as to why the unfair dismissal application was frivolous or vexatious is that the Applicant's work was covered by a federal industrial instrument and despite being told that, he persisted in pursuing his application in this State jurisdiction. Ground of Frivolous or Vexatious 26 The Full Bench Decision in Peden's Case sets out the relevant authorities on the meaning of frivolous and vexatious. (pp8 to 13 inclusive). Although there are matters before this Commission in which the terms "frivolous" and "vexatious" have been considered separately, because of the circumstances of those cases, that is not so in respect of the matter before this Commission. The Commission takes that view because of the employer's submission that the Applicant filed and persisted in staying in the wrong jurisdiction. To put that another way, having regard to the terms, "frivolous" or "vexatious", the employer is submitting that the unfair dismissal application was "groundless". 27 The term "groundless", per se, does not appear in either of those two terms. However, arguably it can be said that "groundless" covers the meaning of "no weight" (as that term appears in the meaning of "frivolous") and covers the meaning of "manifestly groundless" (as that term appears in the meaning of "vexatious"), as discussed in Peden's Case. 28 The Commission will now consider whether the Applicant's unfair dismissal application was "groundless", so as to be "frivolous" and "vexatious". If the answer to that enquiry is in the affirmative then, and only then, does the Commission then exercise its discretion as to whether costs should be awarded - and if so, on what basis. 29 Turning to the facts of the case, the employer submitted that the Applicant filed in the wrong jurisdiction and persisted in staying in that State jurisdiction, despite being told his conditions of employment were covered by a federal industrial instrument. 30 The Applicant's unfair dismissal application had no reference to what award applied. The appropriate section of the application on that issue was marked "N/A". The Employers Reply to that application did not raise jurisdiction as an issue. Indeed, the Employers Reply comprised unfair dismissal documentation made up from this State and the Federal industrial tribunals. 31 The issue of jurisdiction was first raised at the first Conciliation and Directions held on 16 December, 2005. 32 The Tiernan correspondence states that, "…the Respondent pointed out to Commissioner Cambridge the Respondent's contention that the Commissioner lacked jurisdiction to hear the matter, on the basis that the Applicant's employment was governed by a National Workplace Agreement, …" A reading of the transcript for that date does not bear out that contention. It was the Commissioner himself who began the line of questioning to Mr Tiernan about what "Workplace agreement" applied?; and "In this Commission or a Federal Commission?" and received the reply from Mr Tiernan, "…I think it's a federal document, Commissioner." (Tr. 16/12/05 - p2, line 49 to p3, line 10). 33 The transcript for that day shows an on-going discussion about jurisdiction. To say that this discussion involved the Applicant is mis-leading. The Applicant had a friend with him for interpretation purposes. This person was Mr Xia. He was described as "a friend" during the next lot of proceedings on 23 January 2006 (Tr 23/01/06 - p3 - line 19 to 22). 34 The discussion on jurisdiction included the Commissioner explaining to the Applicant, through "a friend", that there was a distinction between the state and federal Commissions, just as there was a distinction between State (Premier Morris Iemma) and Federal Governments. The Commissioner even gave the address of the Federal Commission (80 William Street East Sydney). The discussion then turned to settlement of the matter but to no avail. 35 The Commissioner returned to the theme of jurisdiction. The last page of the transcript is reproduced below as it shows the Commissioner reiterating his message for the Applicant to proceed with his unfair dismissal claim elsewhere - William Street. The other purpose in reproducing the transcript extract goes to the ultimate question for this Commission to decide: Despite the Applicant being told to proceed with his claim elsewhere, did he understand what was being discussed? Note, as well, that the Applicant is recorded as having spoken - apart from "a friend". "COMMISSIONER: Have you got any questions because what I propose to do is to adjourn the matter and require that by, as I said, 27 January next year, you send some correspondence to the Commission telling me what's happened. If you've gone to the Federal Commission then you're matter has started there, you tell me that and then I can stop this matter. If you've decided to do something else well, put it in a letter and send it to me. APPLICANT :… (non transcribable).. finish this case. COMMISSIONER: I beg your pardon? APPLICANT: I say this… (non transcribable).. not here give me to fix something, the problem. Must we have to go to the William Street another court. COMMISSIONER: Yes, you go to William Street, yes. APPLICANT : Only William Street we can, can we fix the problem. COMMISSIONER: Yes, I think that's right. I don't think there's any real likelihood that you can fix this problem here. XIA: We go there. APPLICANT: I go to over there. COMMISSIONER: Once you start that matter then you send me a letter so I stop this one. It's only a short walk I've walked up there before, it's quite a pleasant walk. APPLICANT: Yes, we go there. COMMISSIONER: Yes, that's right do that. Very good. Is there anything further? No, on that basis the proceedings now stand adjourned. ADJOURNED" 36 Commissioner Cambridge received a handwritten, one page letter from the Applicant. (Whether it was written by him or by someone on his behalf is unknown). The letter makes no reference to contacting the Australian Industrial Relations Commission about his unfair dismissal. The context of the letter is contained in the opening sentence: "I (?) write this letter to advise I would seeking arbitration for monetary compensation". 37 The second Conciliation and Directions took place on 23 January 2006. 38 The Applicant was now assisted by an interpreter appointed through the Commission. 39 The transcript shows that Mr Tiernan was unaware of the foregoing letter and he was provided an opportunity by the Commissioner to read it. 40 A discussion ensued between the Commissioner and the Applicant's interpreter, Ms Zou, about the processing of the unfair dismissal application. (The transcript does not show the Applicant himself as having spoken). The discussion shows the Commissioner raising with the Applicant that his application "…on its face…should've been made in the Australian Commission in William Street." The Commissioner went on to express the hope that the Applicant might have carried out research into the issue (between 16 December and 23 January) then under discussion. The Applicant responded that his application had been "accepted" (by the State Commission) and he presumed therefore it would be dealt with by the State Commission. 41 The Applicant asked if his file could be transferred to another court (presumably the Australian Commission). The Commissioner responded in the negative. Again he said his application "was accepted so I don't know who's fault it is." 42 The Applicant also referred to his level of understanding as to what was going on when he said, again through the interpreter: "ZOU: Actually because - maybe it was still to the last time I got a friend here to help me and he didn't understand many of the words, so I didn't have the interpretation." (Tr 23/01/06 - p1 to p3, line 33) 43 The Commissioner programmed the matter under Practice Direction 17 - but on the preliminary issue being advanced by the employer (filed in the wrong jurisdiction). 44 From the foregoing accounts of the first two listings of Conciliation and Directions, this Commissioner is to determine the employer's claim for costs on the ground of "frivolous" and "vexatious", where those terms are being used to mean "groundless". That is, was the unfair dismissal application so groundless, that the claim of "frivolous" and "vexatious" has been met, given the facts of the case? 45 In considering that question, the Commission has been conscious of its Ex Tempore Decision at the threshold Hearing, that the Applicant's conditions of employment were governed by a federal industrial instrument. That finding, in itself, does not make that, or indeed any, unfair dismissal application groundless. An applicant may have merit in pursuing a case that he/she believes is filed in the correct jurisdiction. 46 But in this case, all that the Applicant put in his defence was that his unfair dismissal claim had been "accepted" by the State Commission. However, Commissioner Cambridge pointed out to the Applicant at the second Conciliation and Directions of 23 January, that just because the claim had been "accepted", that "doesn't mean that it's in the right place". (Tr 23/01/06 - p3, line 1 to 3). 47 As the Applicant had not really put up a defence to his allegedly being in the wrong jurisdiction, the Commission then considered whether he understood the discussion between himself and the Commissioner about this wrong jurisdiction issue. 48 There is case law surrounding an unrepresented party's understanding of court proceedings generally and the need for a court to take that issue into account. Thus: "What must be done to assist an unrepresented party depends on the nature of the case and the parties intelligence and understanding of the case": Abraham and Anor v Bank of New Zealand (1996) ATPR 41-507. 49 In considering the foregoing, it is certainly the situation that the Applicant was unrepresented at all times. As to the nature of the case, it was not complicated. It was the issue as to whether the Applicant had filed in the wrong jurisdiction. Finally, did the Applicant understand the discussion between himself and Commissioner Cambridge about the wrong jurisdiction issue? 50 Having considered the discussion that took place over those two lots of Conciliation and Directions, the Commission has decided that the Applicant had the understanding that he should take his application to 80 William Street. 51 The Commissioner extracted above the last page of the transcript of 16 December 2005, in which Commissioner Cambridge reiterated his direction for the Applicant to go to William Street. The interpreter responded: "We go there". The transcript then records the Applicant, himself, stating: "I go to over there". But he did not do as he said. 52 At the second listing, and as already extracted above, the Applicant said he didn't "understand many of the words, so I didn't have the interpretation". He said this on the basis that he only had "a friend" interpreting for him and not a Commission appointed interpreter. But the problem with this defence, is that the Applicant himself is recorded as having spoken on 16 December and he said: "I go to over there" (80 William Street). 53 Accordingly, the Commission takes the view that the Applicant understood that he was being given advice by the Commissioner to take his application to 80 William Street (the Australian Commission) but he ignored that advice. Costs - The Commission's Discretion 54 The awarding of costs is a two stage process. Firstly, a party seeking costs must establish that one of the grounds contained in s181(2)(c) has been made out. Only if one of those grounds has been made out, does the second stage come into play. That second stage is the exercise of the Commission's discretion as to whether costs should be awarded (despite one of the grounds being made out): s181(1)(b). 55 The Tiernan correspondence claims costs and states that the costs includes: (a) costs of or incidental to proceedings in the Commission". What then follows in the Tiernan correspondence is an itemised costing list. As best as the Commission understands the costing list, it seems that the cost per Conciliation and Directions was $2688.50. Costing has been also claimed for the listing by the Deputy Industrial Registrar for the employer's Notice of Motion. There is also the costing for the threshold Hearing. 56 For reasons set out below, the Commission declines to exercise its discretion to grant the employer's costs for the two Conciliation and Directions (16 December 2005 and 23 January 2006) and the listing for the Notice of Motion (14 February 2006). 57 The Commission declines to award costs for the two Conciliation and Directions listings. The Commission agrees with the view of Sams DP of this Commission that "in most circumstances costs associated with conciliation proceedings, should not be taken into account": Mervat Wahba & Miles Fresh Food Market Trading as Brighton Fruit Farm Pty Limited (1999) NSWIRComm 329 (29 July 1999) 58 There is nothing about the two Conciliations and Directions listings that would cause this Commission to depart from the above extract. There were only two listings for Conciliation and in the second listing, the file was programmed for a threshold Hearing. The Commission notes as well that the Employers Reply did not raise jurisdiction as an issue but even if it had, that would not have been a matter having any bearing on the exercise of my discretion. 59 The Commission declines to grant costs for the listing of the Notice of Motion before Deputy Registrar Anastasi. The Notice of Motion was filed by the employer. It was at the initiative of the employer. Why should the Applicant pay the costs for an employer initiative? And, in any event, the Notice of Motion was not a necessary course of action. The unfair dismissal file had already been programmed for a threshold Hearing on jurisdiction. Further, the employer suffered no detriment at the Notice of Motion proceedings. The employer obtained what it sought - a Hearing on its Notice of Motion - at the first listing. The employer was not required to come back another day to deal its Notice of Motion due to some action or decision of the Applicant. Indeed the Applicant was not present at the Notice of Motion listing. There appears to be no evidence in the unfair dismissal file that he was aware of the listing of the Notice of Motion. (The Commission was concerned that the Applicant had no knowledge of the Notice of Motion but he confirmed at the Hearing on the Notice of Motion that he had received that Notice of Motion by post - Tr 08/03/06 - p1 to 2). 60 As to threshold Hearing, the Commission is prepared to award costs but only on an agreed or assessed basis. Further the costs are for the Hearing itself and not "costs of or incidental to proceedings in the Commission". The Commission exercises its discretion to grant costs for that Hearing only because Commissioner Cambridge gave direct advice to the Applicant as to where to go (80 William Street) to further his unfair dismissal cause - but the Applicant ignored that advice. 61 In granting costs, the Commission is minded that in unfair dismissal proceedings, costs do not follow the event (go to the "winning" party): Copperart Pty Ltd v Martin (1996) 68 IR 58, at 64. It is only by the exercise of the Commission's discretion that costs are awarded and the Commission does so, for the reason given, but only for the Hearing itself on 8 March 2006 and not for any incidentals. ORDERS 1. The Commission orders pursuant to s181(2)(c) of the Industrial Relations Act 1996 that the Applicant, Jian Ping Qian, in matter number 6097 of 2005, shall pay the costs and only those costs for the Hearing held on 8 March 2006. 2. The Applicant is not being ordered to pay incidental costs for the Hearing of 8 March 2006. 3. Such costs are to be as agreed or assessed. 4. This order as to costs shall take effect on 14 December 2006 and the amount agreed or assessed shall be paid within two months of this date. A Macdonald Commissioner INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: MACDONALD C 14 December 2006 Matter No IRC 6097 of 2005 Jian Ping Qian and Brighton Australia Pty Ltd. Application by Jian Ping Qian re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION [2006] NSWIRComm 1174 1 This Decision concerns an application made by an employer (Brighton Australia Pty Ltd) against a former employee (Jian Ping Qian). 2 The application is a Notice of Motion filed by the employer and which seeks the following: (a) The employee's unfair dismissal application be dismissed for want of prosecution; and (b) The employee pay the employer's costs pursuant to s181 of the Act. BACKGROUND 3 Mr Jian Ping Qian filed an unfair dismissal application on 24 November 2005. He named his employer as Brighton Australia Pty Ltd. 4 The employer put on a response to the unfair dismissal application. That response comprised documentation pertaining to an unfair dismissal application made up of this state industrial relations tribunal and the federal industrial relations tribunal. 5 The unfair dismissal application came before Cambridge C on 16 December 2005 for Conciliation and Directions. Mr Jian Ping Qian appeared unrepresented. The employer was represented by Mr P Tiernan, solicitor. 6 The matter was set down for Mention and Directions on 23 January 2006. The employee appeared unrepresented. An interpreter was present to assist him. The employer was again represented by Mr Tiernan. The matter was programmed for a Hearing on a threshold issue, being the "question of jurisdiction". Mr Tiernan's opening submissions of 23 January went to the Applicant's employment being governed by a federal collective bargaining agreement in conjunction with a named national award. 7 Cambridge C programmed the matter for a determination on the threshold issue of jurisdiction in accordance with Practice Direction 17. As the employer was agitating that there was a threshold issue, then the employer was required to file its relevant material firstly (3 February 2006); thence the employee (24 February); and finally the employer in reply (3 March). 8 By correspondence, dated 3 February 2006, Mr Tiernan wrote to The Registrar of this Commission, giving advice of a Notice of Motion to strike out the employee's unfair dismissal application. The covering letter of the above date and supporting documentation had been facsimiled to The Registrar. The covering letter does not state that a copy has been forwarded to the Applicant. 9 A Notice of Motion was filed by the employer's law firm on 8 February 2006. The Notice of Motion set out the following: (a) The employee's unfair dismissal application be dismissed for want of jurisdiction; and (b) The employee pay the employer's costs pursuant to s181 of the Act. The Notice of Motion was forwarded to Walton J., Vice President for his consideration and returned then to the Registry. There is a Registry file note that a Mandarin interpreter will be required. 10 The file then came on before Deputy Registrar Anastasi on 14 February. There was no appearance by the employee. Mr Tiernan appeared for the employer. 11 The transcript of discussion between the Deputy Registrar and Mr Tiernan establishes that the threshold issue of the employee having allegedly filed in the wrong jurisdiction is set for a Hearing on 8 March. The Deputy Registrar was not able to provide a hearing date for the Notice of Motion prior to 8 March. Accordingly, that date was selected for the hearing on the Notice of Motion and that Notice of Motion would be dealt with first - that is, before the threshold Hearing on the alleged wrong jurisdiction issue. Finally, the Deputy Registrar states that the employee will be advised by the court of the listing of the Notice of Motion for 8 March. 12 The Notice of Motion was dealt with on 8 march 2006. The employer was represented by Mr Tiernan. The employee remained unrepresented. He was assisted during the proceedings by an interpreter. Evidence was given in the proceedings by Mr R Gavran, director. At the conclusion of the proceedings, the Commission issued an Ex Tempore Decision which found that the employee had his conditions of employment governed by a federal industrial instrument. The Commission, however, reserved its decision in respect of the costs application by the employer. The Commission directed Mr Tiernan to provide to the Commission and the employee, a formal document setting out the costs being sought. 13 By correspondence of 16 March 2006, Mr Tiernan set out the information sought by the Commission. 14 The Commission received correspondence from the employee. The letter bears a Registry stamp of 31 March 2006. The employee advised that he had received a letter from the Australian Industrial Relations Commission ("the AIRC") on 16/03/2006 to say that his unfair dismissal was dismissed by the AIRC for being lodged out of time. He also stated that he should not have to pay compensation to his employer because it was not his fault that the application was lodged before the "IRC of New South Wales". That is, the "IRC of New South Wales" had accepted his unfair dismissal application and, by implication, it should not have so accepted as he was covered by a federal instrument. As the AIRC had rejected his application, he asked that the "IRC of New South Wales" consider his application again. 15 The Commission received a Notice of Discontinuance on behalf of the employee, filed on 5 May 2006. CONSIDERATION 16 This Decision concerns an application for costs by the employer against the former employee. The costs application is made in the context where the unfair dismissal application proceeded to a Hearing and the Commission determined that the employee had his conditions of employment determined by a federal industrial instrument. In other words, this State Commission lacked jurisdiction to deal with the unfair dismissal application. The Applicable Statutory Law 17 The employer applied for an order that the employee pay its costs pursuant to: "Section 181(1)(a), 181(1)(b) and or 181(2)(a), 181(2)(b) or 181(2)(c) of the Act." (emphasis added) (Per correspondence of Mr Tiernan, dated 16 March 2006 - "the Tiernan correspondence"). 18 The Commission needs to comment on the foregoing extract from the Tiernan correspondence. 19 The Commission has given emphasis to "and or". The Commission did so because a costs application arising out of an unfair dismissal application is not based, at law, on an "or" basis - that is on s181(1) or s181(2). 20 A cost application is based on both s181(1) and s181(2). Even that statement by the Commission needs further refinement but suffices to make the point that there is no "or" basis for the making of a costs application. 21 The Commission stated above that a certain pronouncement needed further refinement. The Commission had stated that a costs application is grounded on both s181(1) and s181(2). The further refinement correctly states the basis of a costs application as: s181(1)(a) and (b) and s181(2)(c): Peden v Lake Macquarie Refrigeration Pty Limited [2004] NSWIRComm 66 at para 14 (Wright J, President, Walton J. Vice-President, Macdonald C) ("Peden's Case")Thus: " 181 Costs (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 ………………………… (2) However, the Commission when it is not in Court Session may award costs only in the following cases: …………………………… (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 ….." 22 The foregoing Full Bench decision makes it clear that the only costs ground available for an unfair dismissal application, is that found in s181(2)(c). Accordingly, a costs application pursuant to s181(2)(a) and s181(2)(b), per the Tiernan correspondent, is not available to the employer against the employee. Ground(s) for Costs Application 23 Section 181(2)(c) sets out three grounds for a costs application: (a) one party failed to agree to a settlement; (b) the unfair dismissal application was frivolous; (c) the unfair dismissal application was vexatious. The Tiernan correspondence does not state which ground(s) is/are relied upon to ground the employer's application for costs. 24 The transcript for the Hearing on the Notice of Motion shows that Mr Tiernan put a submission as to costs and that the circumstances he relied upon to ground the costs application, were described as "circumstances that border on frivolous or vexatious" (Tr. 08/03/06 - p14, line 18) Accordingly, the Commission will consider the employer's cost application on the grounds of frivolous or vexatious. 25 The thrust of the employer's submission as to why the unfair dismissal application was frivolous or vexatious is that the Applicant's work was covered by a federal industrial instrument and despite being told that, he persisted in pursuing his application in this State jurisdiction. Ground of Frivolous or Vexatious 26 The Full Bench Decision in Peden's Case sets out the relevant authorities on the meaning of frivolous and vexatious. (pp8 to 13 inclusive). Although there are matters before this Commission in which the terms "frivolous" and "vexatious" have been considered separately, because of the circumstances of those cases, that is not so in respect of the matter before this Commission. The Commission takes that view because of the employer's submission that the Applicant filed and persisted in staying in the wrong jurisdiction. To put that another way, having regard to the terms, "frivolous" or "vexatious", the employer is submitting that the unfair dismissal application was "groundless". 27 The term "groundless", per se, does not appear in either of those two terms. However, arguably it can be said that "groundless" covers the meaning of "no weight" (as that term appears in the meaning of "frivolous") and covers the meaning of "manifestly groundless" (as that term appears in the meaning of "vexatious"), as discussed in Peden's Case. 28 The Commission will now consider whether the Applicant's unfair dismissal application was "groundless", so as to be "frivolous" and "vexatious". If the answer to that enquiry is in the affirmative then, and only then, does the Commission then exercise its discretion as to whether costs should be awarded - and if so, on what basis. 29 Turning to the facts of the case, the employer submitted that the Applicant filed in the wrong jurisdiction and persisted in staying in that State jurisdiction, despite being told his conditions of employment were covered by a federal industrial instrument. 30 The Applicant's unfair dismissal application had no reference to what award applied. The appropriate section of the application on that issue was marked "N/A". The Employers Reply to that application did not raise jurisdiction as an issue. Indeed, the Employers Reply comprised unfair dismissal documentation made up from this State and the Federal industrial tribunals. 31 The issue of jurisdiction was first raised at the first Conciliation and Directions held on 16 December, 2005. 32 The Tiernan correspondence states that, "…the Respondent pointed out to Commissioner Cambridge the Respondent's contention that the Commissioner lacked jurisdiction to hear the matter, on the basis that the Applicant's employment was governed by a National Workplace Agreement, …" A reading of the transcript for that date does not bear out that contention. It was the Commissioner himself who began the line of questioning to Mr Tiernan about what "Workplace agreement" applied?; and "In this Commission or a Federal Commission?" and received the reply from Mr Tiernan, "…I think it's a federal document, Commissioner." (Tr. 16/12/05 - p2, line 49 to p3, line 10). 33 The transcript for that day shows an on-going discussion about jurisdiction. To say that this discussion involved the Applicant is mis-leading. The Applicant had a friend with him for interpretation purposes. This person was Mr Xia. He was described as "a friend" during the next lot of proceedings on 23 January 2006 (Tr 23/01/06 - p3 - line 19 to 22). 34 The discussion on jurisdiction included the Commissioner explaining to the Applicant, through "a friend", that there was a distinction between the state and federal Commissions, just as there was a distinction between State (Premier Morris Iemma) and Federal Governments. The Commissioner even gave the address of the Federal Commission (80 William Street East Sydney). The discussion then turned to settlement of the matter but to no avail. 35 The Commissioner returned to the theme of jurisdiction. The last page of the transcript is reproduced below as it shows the Commissioner reiterating his message for the Applicant to proceed with his unfair dismissal claim elsewhere - William Street. The other purpose in reproducing the transcript extract goes to the ultimate question for this Commission to decide: Despite the Applicant being told to proceed with his claim elsewhere, did he understand what was being discussed? Note, as well, that the Applicant is recorded as having spoken - apart from "a friend". "COMMISSIONER: Have you got any questions because what I propose to do is to adjourn the matter and require that by, as I said, 27 January next year, you send some correspondence to the Commission telling me what's happened. If you've gone to the Federal Commission then you're matter has started there, you tell me that and then I can stop this matter. If you've decided to do something else well, put it in a letter and send it to me. APPLICANT :… (non transcribable).. finish this case. COMMISSIONER: I beg your pardon? APPLICANT: I say this… (non transcribable).. not here give me to fix something, the problem. Must we have to go to the William Street another court. COMMISSIONER: Yes, you go to William Street, yes. APPLICANT : Only William Street we can, can we fix the problem. COMMISSIONER: Yes, I think that's right. I don't think there's any real likelihood that you can fix this problem here. XIA: We go there. APPLICANT: I go to over there. COMMISSIONER: Once you start that matter then you send me a letter so I stop this one. It's only a short walk I've walked up there before, it's quite a pleasant walk. APPLICANT: Yes, we go there. COMMISSIONER: Yes, that's right do that. Very good. Is there anything further? No, on that basis the proceedings now stand adjourned. ADJOURNED" 36 Commissioner Cambridge received a handwritten, one page letter from the Applicant. (Whether it was written by him or by someone on his behalf is unknown). The letter makes no reference to contacting the Australian Industrial Relations Commission about his unfair dismissal. The context of the letter is contained in the opening sentence: "I (?) write this letter to advise I would seeking arbitration for monetary compensation". 37 The second Conciliation and Directions took place on 23 January 2006. 38 The Applicant was now assisted by an interpreter appointed through the Commission. 39 The transcript shows that Mr Tiernan was unaware of the foregoing letter and he was provided an opportunity by the Commissioner to read it. 40 A discussion ensued between the Commissioner and the Applicant's interpreter, Ms Zou, about the processing of the unfair dismissal application. (The transcript does not show the Applicant himself as having spoken). The discussion shows the Commissioner raising with the Applicant that his application "…on its face…should've been made in the Australian Commission in William Street." The Commissioner went on to express the hope that the Applicant might have carried out research into the issue (between 16 December and 23 January) then under discussion. The Applicant responded that his application had been "accepted" (by the State Commission) and he presumed therefore it would be dealt with by the State Commission. 41 The Applicant asked if his file could be transferred to another court (presumably the Australian Commission). The Commissioner responded in the negative. Again he said his application "was accepted so I don't know who's fault it is." 42 The Applicant also referred to his level of understanding as to what was going on when he said, again through the interpreter: "ZOU: Actually because - maybe it was still to the last time I got a friend here to help me and he didn't understand many of the words, so I didn't have the interpretation." (Tr 23/01/06 - p1 to p3, line 33) 43 The Commissioner programmed the matter under Practice Direction 17 - but on the preliminary issue being advanced by the employer (filed in the wrong jurisdiction). 44 From the foregoing accounts of the first two listings of Conciliation and Directions, this Commissioner is to determine the employer's claim for costs on the ground of "frivolous" and "vexatious", where those terms are being used to mean "groundless". That is, was the unfair dismissal application so groundless, that the claim of "frivolous" and "vexatious" has been met, given the facts of the case? 45 In considering that question, the Commission has been conscious of its Ex Tempore Decision at the threshold Hearing, that the Applicant's conditions of employment were governed by a federal industrial instrument. That finding, in itself, does not make that, or indeed any, unfair dismissal application groundless. An applicant may have merit in pursuing a case that he/she believes is filed in the correct jurisdiction. 46 But in this case, all that the Applicant put in his defence was that his unfair dismissal claim had been "accepted" by the State Commission. However, Commissioner Cambridge pointed out to the Applicant at the second Conciliation and Directions of 23 January, that just because the claim had been "accepted", that "doesn't mean that it's in the right place". (Tr 23/01/06 - p3, line 1 to 3). 47 As the Applicant had not really put up a defence to his allegedly being in the wrong jurisdiction, the Commission then considered whether he understood the discussion between himself and the Commissioner about this wrong jurisdiction issue. 48 There is case law surrounding an unrepresented party's understanding of court proceedings generally and the need for a court to take that issue into account. Thus: "What must be done to assist an unrepresented party depends on the nature of the case and the parties intelligence and understanding of the case": Abraham and Anor v Bank of New Zealand (1996) ATPR 41-507. 49 In considering the foregoing, it is certainly the situation that the Applicant was unrepresented at all times. As to the nature of the case, it was not complicated. It was the issue as to whether the Applicant had filed in the wrong jurisdiction. Finally, did the Applicant understand the discussion between himself and Commissioner Cambridge about the wrong jurisdiction issue? 50 Having considered the discussion that took place over those two lots of Conciliation and Directions, the Commission has decided that the Applicant had the understanding that he should take his application to 80 William Street. 51 The Commissioner extracted above the last page of the transcript of 16 December 2005, in which Commissioner Cambridge reiterated his direction for the Applicant to go to William Street. The interpreter responded: "We go there". The transcript then records the Applicant, himself, stating: "I go to over there". But he did not do as he said. 52 At the second listing, and as already extracted above, the Applicant said he didn't "understand many of the words, so I didn't have the interpretation". He said this on the basis that he only had "a friend" interpreting for him and not a Commission appointed interpreter. But the problem with this defence, is that the Applicant himself is recorded as having spoken on 16 December and he said: "I go to over there" (80 William Street). 53 Accordingly, the Commission takes the view that the Applicant understood that he was being given advice by the Commissioner to take his application to 80 William Street (the Australian Commission) but he ignored that advice. Costs - The Commission's Discretion 54 The awarding of costs is a two stage process. Firstly, a party seeking costs must establish that one of the grounds contained in s181(2)(c) has been made out. Only if one of those grounds has been made out, does the second stage come into play. That second stage is the exercise of the Commission's discretion as to whether costs should be awarded (despite one of the grounds being made out): s181(1)(b). 55 The Tiernan correspondence claims costs and states that the costs includes: (a) costs of or incidental to proceedings in the Commission". What then follows in the Tiernan correspondence is an itemised costing list. As best as the Commission understands the costing list, it seems that the cost per Conciliation and Directions was $2688.50. Costing has been also claimed for the listing by the Deputy Industrial Registrar for the employer's Notice of Motion. There is also the costing for the threshold Hearing. 56 For reasons set out below, the Commission declines to exercise its discretion to grant the employer's costs for the two Conciliation and Directions (16 December 2005 and 23 January 2006) and the listing for the Notice of Motion (14 February 2006). 57 The Commission declines to award costs for the two Conciliation and Directions listings. The Commission agrees with the view of Sams DP of this Commission that "in most circumstances costs associated with conciliation proceedings, should not be taken into account": Mervat Wahba & Miles Fresh Food Market Trading as Brighton Fruit Farm Pty Limited (1999) NSWIRComm 329 (29 July 1999) 58 There is nothing about the two Conciliations and Directions listings that would cause this Commission to depart from the above extract. There were only two listings for Conciliation and in the second listing, the file was programmed for a threshold Hearing. The Commission notes as well that the Employers Reply did not raise jurisdiction as an issue but even if it had, that would not have been a matter having any bearing on the exercise of my discretion. 59 The Commission declines to grant costs for the listing of the Notice of Motion before Deputy Registrar Anastasi. The Notice of Motion was filed by the employer. It was at the initiative of the employer. Why should the Applicant pay the costs for an employer initiative? And, in any event, the Notice of Motion was not a necessary course of action. The unfair dismissal file had already been programmed for a threshold Hearing on jurisdiction. Further, the employer suffered no detriment at the Notice of Motion proceedings. The employer obtained what it sought - a Hearing on its Notice of Motion - at the first listing. The employer was not required to come back another day to deal its Notice of Motion due to some action or decision of the Applicant. Indeed the Applicant was not present at the Notice of Motion listing. There appears to be no evidence in the unfair dismissal file that he was aware of the listing of the Notice of Motion. (The Commission was concerned that the Applicant had no knowledge of the Notice of Motion but he confirmed at the Hearing on the Notice of Motion that he had received that Notice of Motion by post - Tr 08/03/06 - p1 to 2). 60 As to threshold Hearing, the Commission is prepared to award costs but only on an agreed or assessed basis. Further the costs are for the Hearing itself and not "costs of or incidental to proceedings in the Commission". The Commission exercises its discretion to grant costs for that Hearing only because Commissioner Cambridge gave direct advice to the Applicant as to where to go (80 William Street) to further his unfair dismissal cause - but the Applicant ignored that advice. 61 In granting costs, the Commission is minded that in unfair dismissal proceedings, costs do not follow the event (go to the "winning" party): Copperart Pty Ltd v Martin (1996) 68 IR 58, at 64. It is only by the exercise of the Commission's discretion that costs are awarded and the Commission does so, for the reason given, but only for the Hearing itself on 8 March 2006 and not for any incidentals. ORDERS 1. The Commission orders pursuant to s181(2)(c) of the Industrial Relations Act 1996 that the Applicant, Jian Ping Qian, in matter number 6097 of 2005, shall pay the costs and only those costs for the Hearing held on 8 March 2006. 2. The Applicant is not being ordered to pay incidental costs for the Hearing of 8 March 2006. 3. Such costs are to be as agreed or assessed. 4. This order as to costs shall take effect on 14 December 2006 and the amount agreed or assessed shall be paid within two months of this date. A Macdonald 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.