D) In view of her knowledge of the probationary period and its effect, it was unreasonable for her to persist with prosecuting a claim knowing it was futile to do so.
30 In view of this finding, it is unnecessary for me to consider whether the applicant unreasonably failed to agree to a settlement of the claim. Although I note that the only practical and sensible option, after the conciliation conferences was for the applicant to withdraw her application, with costs to be met by both parties.
31 Because of the express intention of the legislature to encourage conciliation of unfair dismissal claims, and the restrictions placed on costs applications by virtue of s181(2)(c), I am of the view, as expressed in Wahba and Miles Fresh Fruit Market t/as Brighton Fruit Barn Pty Ltd (Sams DP, Decision on Costs in Matter IRC4413 of 1998, 29 July 1999), that only in exceptional circumstances should costs associated with conciliation proceedings be taken into account.
32 This principle is particularly relevant where the applicant is unrepresented, and may not be fully aware of the consequences of proceeding to arbitration, where difficult and complex legal questions, might arise.
33 However, with full knowledge of the ramifications of continuing with a vengeful and unreasonable case, an applicant places him or herself at considerable risk of costs orders being made, for subsequent arbitration proceedings. I am satisfied the applicant falls within this category.
34 I turn now to consider whether costs should be awarded on an indemnity basis.
35 The principles to be applied in matters involving the order of indemnity costs in unfair dismissal cases, has been helpfully and recently considered in a decision of a Full Bench of the Commission in Bankstown City Council v Paris (Decision as to Costs Wright P, Peterson J, Bishop C, Matter IRC262 of 1999, 17 December 1999).
36 At p30 of the unreported decision the Full Bench said:
We consider that the following principles should be applied in relation to the application for indemnity costs made in circumstances where the Commission has held that the first criterion in s181(2)(c) has been held to be satisfied, and an application for costs is made. The Commission can properly, in the appropriate exercise of its discretion, make an order for indemnity costs. The power to make a costs order of that kind is clearly available because of the terms of s181(1)(b).
It must, however, be recognised that the exercise of discretion is being called for in the context of circumstances which are out of the usual. That is, the discretion is only available in non-Court Session matters where one or more of specified criteria are met. Secondly, although the finding that a relevant criterion has been met may, in some circumstances, be satisfaction of circumstances which might lead to the award of indemnity costs, and although the existence of such circumstances is relevant to the grant of costs on that basis, the Commission should exercise the discretion in full recognition of the caution that should be exercised before making a costs order on a basis other than that costs should simply follow the event, since that is the way in which a discretion to order costs would be exercised 'regularly and judicially': see, for example, Moama Bowling Club Limited v Armstrong (No 2) 64 IR 264 at 267 per Cahill Deputy CJ and Peterson J).
Nevertheless, and thirdly, provided such caution is exercised, where the circumstances clearly fall within those where the courts have recognised and indemnity costs should, or may, be granted, then the Commission should consider, in the exercise of its discretion, whether costs should be awarded on that basis. Nevertheless, even at that stage of the exercise of the discretion, the Commission is to recognise that, as the authorities in relation to indemnity costs make clear, the categories in which the discretion may be exercised are not closed and the exercise of the power in relation to indemnity costs remains throughout discretionary. The discretion must be exercised judicially.
We have paid regard to the detailed discussion of principles set out in the judgment of Shepherd J in Colgate-Palmolive Company v Cussons Pty Limited , particularly to the distillation of authority set out therein at 232-234. On a consideration of those authorities it is clear that, for example, a court (or this Commission) ought not usually make a payment of costs on a basis other than the party and party basis; and there must be circumstances which would warrant a court (or this Commission) departing from the usual course.
37 I do not consider that this case meets the criterion which the Full Bench identifies as being "out of the usual". Therefore, I am not satisfied that this is an appropriate case for costs to be awarded on an indemnity basis.
38 Accordingly, the respondent's notice of motion is granted to the extent of my conclusions earlier referred to. I so order.
ORDER
39 Pursuant to s181(2)(c) of the Industrial Relations Act 1996, the Commission orders that: