Industrial Court of New South Wales CITATION: Mamouney v SS&A Club Albury Limited [2006] NSWIRComm 383 APPLICANT: Kylie Louise Mamouney PARTIES: RESPONDENT: SS&A Club Albury Limited FILE NUMBER(S): IRC 2408 of 2006 CORAM: Wright J President; Walton J Vice-President; Boland J CATCHWORDS: Unfair contract - Costs - Practice and procedure - Reference to Full Bench on jurisdictional issues - Subsequent application to discontinuance proceedings - Factual circumstances relevant to issue of costs - No order made as to costs of discontinuance. Australian Constitution s 51(xx) Industrial Relations Act 1996 s 106 s 193 LEGISLATION CITED: Industrial Relations Commission Rules 1996 r 138 Workplace Relations Act 1996 s 16 Workplace Relations Amendment (Work Choices) Act 2005 CASES CITED: Harmer v Shoalhaven Community Housing Scheme Limited [2006] NSWIRComm 1165 New South Wales v Commonwealth of Australia [2006] HCA 52 HEARING DATES: 05/12/2006 EXTEMPORE JUDGMENT DATE: 12/05/2006 APPLICANT: Ms K Eastman of counsel and Ms P Thew of counsel Dick & Williams, Lawyers (Mr Kym Connell) LEGAL REPRESENTATIVES: RESPONDENT: Mr G McGrath of counsel Thomson Playford, Solicitors (Mr Brett Boon) JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES FULL BENCH CORAM: WRIGHT J, President WALTON J, Vice-President BOLAND J Tuesday 5 December 2006 Matter No IRC 2408 of 2006 KYLIE LOUISE MAMOUNEY v SS&A CLUB ALBURY LIMITED Application under s 106 of the Industrial Relations Act 1996 JUDGMENT OF THE COURT [2006] NSWIRComm 383 (Extempore) 1 These proceedings were commenced by Summons for Relief filed by Ms Mamouney under s 106 of the Industrial Relations Act 1996 on 29 May 2006. 2 On 25 July 2006, the respondent to the application, the SS&A Club Albury Limited ("the Club"), filed a Notice of Motion seeking orders that the proceedings be dismissed for want of jurisdiction due to s 16 of the Workplace Relations Act 1996 as amended by the Workplace Relations Amendment (Work Choices) Act 2005 ("the Work Choices Act") and which relevantly came into operation on 27 March 2006. 3 Pursuant to s 193 of the Act, Walton J, Vice-President, referred the matter to the President for the constitution of a Full Bench of the Court and the Full Bench proceedings were listed for hearing today. 4 On 14 November 2006, after written submissions on the motion, filed in accordance with directions issued by the Vice-President, had closed, the High Court of Australia delivered its decision in New South Wales v Commonwealth of Australia [2006] HCA 52 upholding the constitutional validity of the Work Choices Act. 5 On 21 November 2006 Ms Mamouney sought in writing the Club's consent to discontinue the proceedings in accordance with Rule 138(1)(a) of the Industrial Relations Commission Rules 1996 on the basis that each party pay their own costs. On 30 November 2006, following the Club's refusal to consent, Ms Mamouney filed a Notice of Motion seeking (i) leave to discontinue the proceedings pursuant to Rule 138(1)(b) on the basis that each party bear its own costs and (ii) directions that leave to discontinue be granted in chambers in accordance with Rule 138(2) to avoid the incurring of further costs. 6 As part of its general opposition to Ms Mamouney's Notice of Motion, the Club opposed Ms Mamouney's application for the Notice of Motion to be dealt with in chambers on the basis that this would deny it the opportunity to be heard (and to present evidence) in relation to costs. Accordingly, presumably at some expense, both parties and the Full Bench are in court today for the purpose of deciding - in essence - whether the Full Bench should take the step of ordering Ms Mamouney to pay any of the Club's costs of these proceedings. 7 We are not persuaded by the submissions made on behalf of the Club today, nor by the evidence adduced on its behalf, that the Court should do anything other than grant leave to discontinue on the basis that each party bear its own costs of the proceedings. On the contrary: if we were minded to deviate from this orthodox approach, we might give serious consideration to making a costs order of some form against the Club. There is no substance in the assertion that Ms Mamouney's case was unsustainable from the outset. At least until 27 October 2006 when all of the evidence was filed, the question whether the Club was a constitutional corporation was a live issue insofar as Ms Mamouney was concerned. Even following the recent decision of the High Court in New South Wales v Commonwealth of Australia the question whether an employer is a constitutional corporation may be an issue in any proceedings (including, conceivably, these proceedings) before this Court given the High Court itself refrained from ruling upon the meaning and operation of the expression "constitutional corporation" which is a contested issue in Ms Mamouney's case. 8 Furthermore, we can see no justification for awarding costs against Ms Mamouney for maintaining these proceedings pending the decision of the High Court in a complicated, multi-party constitutional challenge. She advised the Club that she wished to discontinue the proceedings on an available basis within a week of the High Court's decision. In our view, the Club's insistence at that time on Ms Mamouney executing a Deed of Release (almost unheard of in this jurisdiction as a condition for mere discontinuance) and its insistence on pursuing costs in that context (to the point of potentially increasing them for both parties) were unreasonable. We do not agree with the submission of the Club that Ms Mamouney could have had the matter stood over at any time to await the High Court decision as on 17 July 2006 the Club indicated that it would not refrain from pressing its application to strike out the proceedings pending the High Court decision. 9 We decline the Club's application for costs. 10 Finally, we should make the following observation. It appears from Ms Mamouney's correspondence and the motion she filed last week that in her decision to seek leave to discontinue she was influenced by the decision of Connor C in Harmer v Shoalhaven Community Housing Scheme Limited [2006] NSWIRComm 1165. We do not consider that decision has any bearing on these proceedings, or indeed others like it. Harmer was settled by conciliation and the observations are, therefore, not only obiter but unwarranted in that context. They do not come with the benefit of substantive argument. Further, as Connor C noted at [5], what constitutes a trading or financial corporation for the purposes of s 51(xx) of the Constitution remains an issue of some jurisdictional uncertainty. Thus the preliminary views of a single commissioner on an issue of such legal significance and complexity in the context of settled proceedings could not be of any real assistance to litigants. 11 We make the following orders: 1. We waive any requirement for the filing of a Notice of Discontinuance. 2. Ms Mamouney is granted leave to discontinue the proceedings pursuant to Rule 138(1)(b) of the Industrial Relations Commission Rules. 3. There shall be no order as to the costs of the proceedings. ___________ 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.