Cavar v Secom Australia Pty Ltd

KATZMANN J: 1 Celia Cavar was employed for several months by Secom Australia Pty Ltd in 2019-20. Secom terminated her employment during her probationary period. Ms Cavar brought proceedings in the court below seeking reinstatement and compensation, alleging that Secom had contravened ss 340, 342, 344, 348 and 351 of the Fair Work Act 2009 (Cth) (FW Act). She also alleged that Secom had contravened the Anti-Discrimination Act 1977 (NSW), the Sex Discrimination Act 1984 (Cth), Age Discrimination Act 2004 (Cth) and Racial Discrimination Act 1975 (Cth). 2 On 1 October 2020 Secom applied for orders under s 17A(2) of the Federal Circuit Court of Australia Act 1999 (Cth) (FCCA Act) and r 13.10(a) and/or r 13.10(b) of the Federal Circuit Court Rules 2001 (FCCA Rules). On 22 October 2021, on Secom's application, the primary judge summarily dismissed Ms Cavar's proceedings purportedly under r 13.10(a) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021(FCFCoA (Div 2) Rules), which commenced on 1 September 2021, holding that they enjoyed no reasonable prospects of success: Cavar v Secom Australia Pty Ltd [2021] FedCFamC2G 163 (summary dismissal judgment). At the same time he invited Ms Cavar, in effect, to show cause why a vexatious proceedings order should not be made against her under s 239 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FCFCoA Act), which also commenced on 1 September 2021. 3 Secom applied for indemnity costs. The application was supported by an affidavit of Justine Marshman, Secom's Human Resources Manager. She deposed that Secom's legal costs amounted to $48,883.83. The primary judge awarded Secom costs but not on an indemnity basis. Rather, his Honour ordered that Ms Cavar pay costs according to the court scale in the amount of $17,718 and that the amount be paid within 28 days of the order or such other time as may be agreed between the parties: Cavar v Secom Australia Pty Ltd (No 2) [2021] FedCFamC2G 289 (costs judgment). The costs judgment was published on 26 November 2021. The same day his Honour published his judgment on the vexatious proceedings order: Cavar v Secom Australia Pty Ltd (No 3) [2021] FedCFamC2G 290 (vexatious proceedings judgment). 4 Ms Cavar filed an application for leave to appeal against the vexatious proceedings judgment on 10 December 2021 and an application for extension of time and leave to appeal from the costs judgment on 23 December 2021. In each matter Secom filed a submitting appearance save as to costs. 5 This judgment is solely concerned with the application for an extension of time and leave to appeal from the costs judgment. I deal with the former application in a separate judgment. 6 There is some doubt about whether leave to appeal is required from a costs order made at the conclusion of a proceeding. In ALDI Foods Pty Ltd v Transport Workers' Union of Australia (2020) 282 FCR 174 at [69]-[71], Besanko, Bromberg and O'Bryan JJ observed that the prevailing view is that leave is required as any costs order is interlocutory in nature but opinion is divided. In that case the Court did not resolve the difference of opinion as it was unnecessary to do so. More recently, in Caratti v Commissioner of the Australian Federal Police [2021] FCA 1067 at [9] Colvin J held that leave is necessary. His Honour went on to explain (at [11]-[13]): There is much to be said for the position that orders as to costs are always interlocutory. The usual test to be applied in determining whether an order is final or interlocutory 'is whether the order, as made, determines the rights of the parties in a principal cause pending between them': In the matter of an appeal by Gaye Alexandra Mary Luck [2003] HCA 70 at [4]. There is no substantive right to an order for costs. Costs orders are always discretionary. They are made to ensure fairness in procedure and to enable the Court to encourage the parties to confine the dispute to the real issues and to use the procedures of the Court for proper purposes. No one comes to the Court with a claim to costs. Therefore, the costs order made at the conclusion of proceedings is not aptly described as finally disposing of any rights of the parties to use the language in In the Matter of an Application by the Chief Commissioner of Police (Vic) [2005] HCA 18 at [28]. The making of costs orders (including such orders made at the time of pronouncing final orders) is a procedural incident of the conduct of the proceedings and does not involve the making of an order the legal effect of which is to finally determine a claim. On an appeal, the discretion to make a costs order is re-enlivened if the appeal is successful so in such cases the possibility of a different costs order flows from substantive success in the appeal. Leave is not required in such cases in order to contend for a different costs order on appeal. However, if the appeal is unsuccessful and the appellant seeks nevertheless to overturn a costs order then leave should be sought and obtained before the court is required to revisit the costs order. Other than in an instance where an appeal was otherwise successful, a costs order, like other interlocutory orders, may only be re-visited on appeal if a proper basis for leave to do so was demonstrated. It follows that costs orders made at the same time as final orders can be revisited without the restrictions that would otherwise confine such circumstances and require an appeal. This approach appears to be consistent with the character of costs orders as orders that do not determine the substantive rights but are consequential procedural orders made in the exercise of discretion, albeit an important discretion for ensuring proper incentives as to the manner in which litigation is conducted. There is support for the approach that costs orders are interlocutory in the reasoning of Jagot J in Melbourne City Investments Pty Ltd v Treasury Wine Estates Ltd [2019] FCA 1458 at [20]‑[27]. 7 In the present case there can be no doubt leave to appeal is required as the costs order was made in relation to an application for summary judgment under s 17A of the FCCA Act and s 24(1D)(ca) of the Federal Court of Australia Act 1976 (Cth) (FCA Act) which provides that a judgment under s 17A of the FCCA Act is taken to be an interlocutory judgment for the purposes of s 24(1A) and (1C). Although the FCCA Act was repealed by the Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Act 2021 (Cth), effective 1 September 2021, the repeal did not affect Secom's application or its rights: Acts Interpretation Act 1901 (Cth), s 7(2). 8 The application for leave to appeal should have been filed within 14 days after the date on which the judgment was pronounced or the order was made: Federal Court Rules 2011 (FCR or Rules), r 35.13(a). Leave will generally only be granted if the applicant can demonstrate that the judgment is attended by sufficient doubt to warrant reconsideration on appeal and substantial injustice would result if leave were refused and the judgment is erroneous: Decor Corporation Pty Ltd v Dart Industries Inc. (1991) 33 FCR 397 at 398 (Sheppard, Burchett and Heerey JJ). 9 This Court has a discretion to extend the time to file the application, which may be exercised before or after the time limit has expired: FCR r 1.39. The purpose of the discretion is to do justice between the parties: Gallo v Dawson [1990] HCA 30; 93 ALR 479; 64 ALJR 458 at 459. While the Rules contain no express constraints or limitations on its exercise of the discretion, s 37M(3) of the FCA Act imposes an obligation on the Court or Judge to do so in the way which best promotes the overarching purpose of its civil procedure provisions, which is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible (FCA Act, s 37M(1)). . Furthermore, a number of considerations guide the exercise of the discretion: see, for example, Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 at 348-9 (Wilcox J). For present purposes it is sufficient to note the following. First, the Court will not grant the application unless it is positively satisfied that it is fair and equitable to do so. Second, the applicant should offer an acceptable explanation for the delay. Third, prejudice to the respondent caused by the delay will militate against the grant of an extension but the mere absence of prejudice is not enough to justify it. Fourth, the merits of the substantive application (here, the application for leave to appeal) are relevant. So, too, is the length of the delay. The longer the delay the more persuasive the explanation will need to be. 10 Here, the delay is not lengthy. The application for leave to appeal should have been filed on 10 December 2021. The application for an extension of time for leave to appeal was lodged four days later. There is no evidence of prejudice to the respondent. In her affidavit Ms Cavar attributed the delay to the Registry's refusal to accept her application for filing. By the time she lodged it, however, the period prescribed by the Rules had already expired. She offered no explanation for her failure to file the leave application within the time prescribed by the Rules. Still, if there were any apparent merit in the proposed appeal, I would be inclined to grant her application. 11 I now turn to the question of whether there is sufficient prospects of success to warrant a grant of leave to appeal or any apparent merit in the proposed appeal. On any application for an extension of time, it is inappropriate to carry out a detailed analysis of the merits but an obvious weakness in an applicant's case tells against the exercise of the discretion in the applicant's favour: ActewAGL Distribution v Australian Energy Regulator (2011) 195 FCR 142 at [111] (Katzmann J) and the authorities referred to there. That is particularly important, having regard to the duty imposed by s 37M(3) of the FCA Act. As Mortimer J explained in Mladenov v Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2014] FCA 12 at [26]: To extend time in an appeal which has no realistic prospects is to involve the Court and the parties, and many public resources, in a process which is not quick, inexpensive or efficient. Unless there are strong countervailing circumstances, it is unlikely to facilitate the just resolution of a dispute to allow a matter, not commenced within the time the law requires, to proceed to a full hearing on a claim that has no realistic prospects of success. 12 For the following reasons I am not satisfied that there is sufficient merit in the proposed appeal to justify extending the time or sufficient doubt about the correctness of the judgment below to warrant a grant of leave. Indeed, the proposed appeal has no realistic prospect of success. 13 The right to appeal from a decision of the Federal Circuit and Family Court of Australia (FCFCoA) (Div 2) is conferred by s 24(1)(d) of the FCA Act. Appeals under s 24 are in the nature of a rehearing in which error on the part of the primary judge must be established: Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424 at [20]-[22] (Allsop J, Drummond and Mansfield JJ agreeing at [1] and [2] respectfully). 14 The draft notice of appeal purports to challenge not only the costs judgment but also the summary dismissal judgment and the vexatious proceedings order. But it points to no error in the costs judgment itself. In substance, the allegation appears to be that the primary judge erred in law by not accepting her contentions about the merits of her case on the summary dismissal application. Yet, Ms Cavar did not seek to appeal the summary dismissal judgment. As I mentioned above, leave to appeal that judgment would have been required and leave was not sought, although Ms Cavar would have been well aware of the requirement for leave: see Cavar v Green Gate Pty Ltd [2015] FCA 1179 at [15] (Flick J). 15 Ms Cavar filed two sets of submissions. Much of what she said was irrelevant to her proposed appeal. Some of her submissions related to her challenge to the vexatious proceeding order. Others sought to impugn the findings in the summary dismissal judgment. In the absence of a successful appeal resulting in orders setting those findings aside, however, those findings are unassailable. 16 The only matters raised which are potentially relevant to the present application are the following contentions: (1) the primary judge's conclusion was wrong and the law he applied "was not in relation to [her] matter and according to that section and section 13.10 of FCC Rules and section 46 of FCA"; (2) Secom had overcharged; the costs claimed in Ms Marshman's affidavit were "fictive"; and made for her private purposes; and (3) the costs order was an abuse of power and beyond the court's jurisdiction as s 257G of the Criminal Procedure Act 1986 says that "order for costs in civil proceedings cannot be made against the appellant". 17 The first contention was not supported by any reasoned argument. The basis for the contention that his Honour's conclusion was wrong appears to be that he came to the wrong conclusion in the summary judgment. At first I assumed that "FCA" is a reference to the FCCA Act. But the reference is obscure. Section 46 of the FCCA Act related to the place where, and the manner in which, documents required or permitted to be filed in the Federal Circuit Court are to be filed. On second thoughts I take the reference to "section 46 of FCA" to be a reference to s 46 of the FCFCoA Act, which is the provision in that Act which allows the FCFCoA (Div 1) to give summary judgment. The equivalent provision with respect to the FCFCoA (Div 2) is s 143. The primary judge purported to exercise the power in s 46, no doubt led astray by Secom, whose submissions erroneously directed him to that section. But nothing turns on the error. The two sections are relevantly identical and reflect the terms of 17A of the FCCA Act, which, as I explained above, was the applicable provision. Rule 13.10 of the FCCA Rules is the rule relating to disposal by summary dismissal. The identical rule appears in the FCFCoA (Div 2) Rules. But it is not r 13.10. It is r 13.13. Rule 13.13 states: Disposal by summary dismissal The Court may order that a proceeding be stayed, or dismissed generally or in relation to any claim for relief in the proceeding, if the Court is satisfied that: (a) the party prosecuting the proceeding or claim for relief has no reasonable prospect of successfully prosecuting the proceeding or claim; or (b) the proceeding or claim for relief is frivolous or vexatious; or (c) the proceeding or claim for relief is an abuse of the process of the Court. 18 The rule is silent on the power to award costs. Plainly, the first contention is not relevant. 19 The second contention appears to be baseless. In her affidavit of 9 November 2011, which I presume is the affidavit to which Ms Cavar was referring, Ms Marshman itemised the professional costs and disbursements incurred by invoice number, date, and amount and annexed a copy of the invoices themselves. The affidavit also annexed a copy of the costs disclosure and costs agreement entered into between Secom and their lawyers. So far as I can tell, Ms Cavar did not cross-examine Ms Marshman on her affidavit or offer any evidence to support her contention that Secom had overcharged. In any case, the primary judge did not award costs according to the amounts charged and in a considerably reduced sum. 20 The third contention is misconceived. The legislation referred to is the Criminal Procedure Act 1986 (NSW). It did not apply to Ms Cavar's proceeding. Indeed, it has nothing to do with civil proceedings. Section 257G is concerned with the method of calculating professional or other costs payable by a prosecutor or accused person if an order is made for costs to be determined under that section. 21 There is no doubt that the court below had the power to award costs, albeit in limited circumstances. The primary judge correctly observed that the power derived from s 570 of the FW Act. 22 Section 570 relevantly provides that a party to proceedings in a court in relation to any matter arising under the FW Act may be ordered by the court to pay costs incurred by another party to the proceedings only if the court is satisfied that "the party instituted the proceedings vexatiously or without reasonable cause" (s 570(2)(a)) or "the party's unreasonable act or omission caused the other party to incur the costs" (s 570(2)(b)). 23 The primary judge referred to a number of the authorities concerning the operation of s 570, which counsel the need for caution and require that the case for its exercise should be "clearly demonstrated", such as Trustee for The MTGI Trust v Johnson (No 2) [2016] FCAFC 190 at [8] (Siopis, Collier and Katzmann JJ) and the more extensive discussion in Australian Workers' Union v Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428 at [7] (Dowsett, McKerracher and Katzmann JJ). In the latter case, the Full Court noted that exceptional circumstances were not required; the relevant question is whether the proceeding had reasonable prospects of success at the time it was instituted, not whether it ultimately failed; the question is to be determined objectively; and, even if the Court has the power to make a costs order, it has a discretion to refuse to exercise it in an appropriate case (at [8]). 24 The primary judge also said at [8] of his reasons that s 570(2)(a) of the FW Act "deals with vexatious proceedings" and went on to refer to Garrett v Commissioner of Taxation [2015] FCA 117 at [4], saying that in that case: Pagone J found vexatious referred to proceedings that were "scandalous, which disclose no reasonable cause of action, which are oppressive, which are embarrassing, or which are an abuse of the process of the Court". It was submitted that the applicant's predominant purpose in instituting proceedings was to harass and embarrass Secom and not for the purpose of having the Court adjudicate on the issues to which they gave rise. 25 In fact, in Garrett at [4] Pagone J made no finding about the meaning of "vexatious". His Honour was citing the remarks of Starke J, with whom Crockett and Beach JJ agreed, in Gallo v Attorney-General (unreported, Supreme Court of Victoria, Full Court, 4 September 1984) at 12, in the different context of an application for a vexatious proceedings order under Part VAAA of the FCA Act. Still, it may be accepted that a proceeding can be said to have been instituted vexatiously if it discloses no reasonable cause of action, is oppressive, embarrassing or an abuse of process. The Full Court accepted as much in Trustee for the MTGI Trust v Johnson at [10]. 26 The primary judge discussed the parties' submissions at [5]-[23] before setting out his reasons at [24] and following. 27 Having regard to the findings he made in the summary judgment, his Honour was satisfied that the requirements in s 570(2)(a) were made out (at [24]-[27]). His Honour referred to his conclusion at [41] of the summary judgment that Ms Cavar's case, taken even at its highest, did not have any reasonable prospects of success. He observed that her case consisted of "bare assertions without any evidence to support them" and included "a series of inflammatory allegations [that Secom had engaged in] criminal conduct and/or conspiracies including at the hands of organised crime". His Honour was also satisfied, based on the findings in the summary judgment, that her initiating application was vexatious (at [27]). He found it to be "manifestly groundless and obviously untenable" and held that "[t]he unsubstantiated and scandalous allegations" Ms Cavar made were an abuse of the court's process. These findings were sufficient to enliven the power in s 570(2)(a). His Honour also took into account her rejection of offers of compromise made by Secom (at [28]), which he plainly considered unreasonable. In so doing, he accepted a submission that Ms Cavar "had acted in an unreasonable manner in failing to resolve the matter efficiently and expeditiously" (set out at [12] of his reasons), which invoked the power in s 570(2)(b). 28 As long as the findings his Honour made in the summary judgment are undisturbed, Ms Cavar has no reasonable prospect of setting aside the costs order. Since she did not apply for leave to appeal the summary judgment, the proposed appeal is hopeless. It follows that the application for an extension of time for leave to appeal must be refused. I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Katzmann.