Kowalski v Mitsubishi Motors Australia Ltd [2001] SAWCT 102

4 The hearing of the worker's application was a protracted affair, the substantive hearing itself extending over eight days spread over some four and a half months. There were many side-issues related to the worker's applications for a stay of the proceedings, for discovery/production of documents and for me to disqualify myself, and hearing days were lost following the worker's production of a certificate of sickness from his general practitioner certifying him unfit to attend the Tribunal. The worker's sickness and inability to attend the Tribunal followed my direction that he produce a previously undisclosed tape recording that he had secretly made of the mediation proceedings and attendance before Conciliation and Arbitration Officer Richer on 3 November 1998, these being the key events out of which the worker's application arose.

5 Before the substantive hearing of the worker's application this year, there had to be determined a preliminary issue concerning the Tribunal's jurisdiction to entertain the application. In a decision delivered on 9 February 2000 I ruled that the Tribunal did have jurisdiction to deal with the worker's application. The respondent appealed my ruling and the worker cross-appealed in relation to comments I made in the course of my reasons for decision. By decision handed down on 15 August 2000 the Full Bench of the Tribunal dismissed both the respondent's appeal and the worker's cross-appeal.

6 The costs of proceedings at judicial determination are regulated by s 88F and s 95 of the Act. As a general rule, a party other than the relevant compensating authority is entitled to recover the costs of proceedings even if unsuccessful. The exception to this rule arises "If the Tribunal is of the opinion that a party acted unreasonably, frivolously or vexatiously in bringing or in relation to the conduct of the proceedings ...": s 95(3).

7 In that event, the Tribunal may in its discretion do any of three things: decline to make an award of costs in favour of the party; make an award of costs against the party; or reduce the amount of the award to which the party would otherwise be entitled: s 95(3)(a) and s 95(3)(b).

8 In this instance, Ms Layton QC, for the respondent, submitted that the worker had acted unreasonably, frivolously and vexatiously both in bringing and in relation to the conduct of the proceedings. The worker disputed that any of these descriptions were applicable to his actions.

9 The worker also contended that the terms of the consent order of 3 November 1998 specifically allowed him to apply under s 88H of the Act to have the order revoked "if I considered that the agreement wasn't complied with". The consent order does not say this. It is clear from the terms of the consent order and the evidence before me relating to its making, including the worker's secret tape-recording thereof, that the purpose and intent of the relevant notation to the order was to provide recourse to the worker in the event of the respondent failing to make the payments as agreed or otherwise failing to meet the terms of the agreement. The respondent met its agreed obligations.

10 The worker further contended that it was premature for the Tribunal to make any cost orders whilst his appeal to the Full Bench of the Tribunal remained pending. In my view, that is simply no basis for the Tribunal declining to deal with the matter now. Moreover, there are sound practical reasons why cost issues should be dealt with promptly whilst everyone's recollections of the proceedings and outcome are relatively fresh.

11 S 95(3) requires the determination of whether a party acted unreasonably, frivolously or vexatiously. This necessarily requires a consideration of the motives of the party. It is not enough to look just at the objective effect of the party's conduct.

12 S 95(3) also requires a consideration of the worker's actions both in bringing the proceedings and in conducting the proceedings.

13 I proceed on the basis that the words unreasonably, frivolously, and vexatiously are not legal or technical words and are to be given their ordinary, natural meaning. The New Shorter Oxford English Dictionary provides the following definitions:-

2 Not based on or acting in accordance with reason or good sense.

3 Going beyond what is reasonable or equitable; excessive.

1 Of little or no value or importance; paltry (of a claim, having no reasonable grounds).

1 Causing or tending to cause vexation, annoyance, or distress; annoying, troublesome.

2 Specially in law - Of an action; instituted without sufficient grounds for winning purely to cause trouble or annoyance to the defendant.

14 The preliminary jurisdictional hearing last year should, in my view, be treated as a separate segment of the proceedings for current purposes. Ms Layton did not press for a costs order against the worker in respect of the judicial determination of that issue. On appeal, the Full Bench of the Tribunal ordered that each party bear its own costs.

15 Given that this preliminary jurisdictional hearing was instigated by the respondent, and that the respondent was unsuccessful before both myself and the Full Bench of the Tribunal on appeal, it cannot be said that the worker acted unreasonably, frivolously or vexatiously in relation to that particular hearing. That being so, there is no basis upon which an order for costs can be made against him

16 The worker himself did not incur representation costs. Insofar as he may have incurred "costs of a kind authorised by the regulations that were reasonably incurred" (s 95(2)(b)) specifically in relation to the judicial determination of the preliminary jurisdictional point, I order that the respondent pay such costs as he may have reasonably incurred.

17 I am mindful that the respondent might say that but for the worker's unreasonable, frivolous and vexatious action in bringing his unmeritorious application in the first place there would have been no need for any proceedings, but I think that this was a distinct segment of the proceedings and that that is a factor adequately addressed in my consideration of costs relating to the substantive hearing.

18 As to those proceedings, it is clear from my decision delivered on 14 August 2001 that the worker was totally unsuccessful in achieving his purpose of having the consent order of 3 November 1998 set aside or declared a nullity, and likewise unsuccessful in obtaining orders declaring selected parts of the settlement agreement null and void. It is also clear that I found him to be an unreliable witness, prone to prevarication and opportunism.

19 The worker's application was from the outset founded on a lie, the lie being that the non-provision to him of Professor McFarlane's draft report dated 16 September 1998 prior to the mediation conference was, because of its contents, significant and meant that he was disadvantaged at the mediation and that he accepted a lesser settlement sum than he otherwise would have. The worker maintained this lie throughout the proceedings. I find that in so doing he acted unreasonably.

20 There was initially no assertion by the worker that the respondent had engaged in any fraud, misrepresentation or unconscionable conduct. These notions were subsequently promoted by the worker until they ultimately became the first and foremost ground for his application to have the consent order of 3 November 1998 set aside. In pursuing his application on these baseless allegations, the worker in my view acted unreasonably.

21 The worker's alternative grounds for relief (that the respondent had previously determined his heart claims, that the respondent was in breach of the Workers Compensation Tribunal Rules, that the settlement agreement breached s 119 of the Act and that there had been non-compliance with the mandatory redemption requirements of the Act) were patently untenable and cannot mask the innate dishonesty underlying his application.

22 The worker also acted unreasonably in relation to the conduct of the proceedings. His various applications for a stay of the proceedings, for discovery and production of irrelevant documents, for leave to tender fresh evidence and for me to disqualify myself, were uniformly without merit and served only to delay and frustrate the progress of the matter. I have no doubt that this was his intended purpose.

23 Although directed not to, the worker persisted in his practice of sending correspondence and facsimiles to me, and others, it seems according to whim. In consequence I accumulated four files of miscellaneous correspondence, applications and affidavits received from the worker. Many of these documents were copies or regurgitated versions of previous documents.

24 In breach of orders made by me and also of his undertaking to correspond only with the respondent's solicitors Fountain and Bonig, the worker persisted in forwarding his correspondence and facsimiles to the respondent direct, and even to the Chairman of the Board of Damlier Chrysler in Stuttgart, Germany. The worker's assertion that he did not undertake to the Tribunal not to write to Damlier Chrysler in Germany, exemplifies the pedantry and prevarication that pervaded his presentation and testimony. This was clearly vexatious conduct.

25 The worker also occasionally copied in others on his anti-Mitsubishi circulation list including the Premier Mr Olsen, other Members of Parliament, the Superannuation Complaints Tribunal, the Fraud Task Force and the mysterious "To Whom It May Concern". His actions in so doing are clear indicators of malice and an intention to embarrass the respondent and cause trouble and annoyance. This too was vexatious conduct.

26 I find that in bringing these proceedings the worker acted unreasonably. He also acted frivolously, on the basis that his application was not made on reasonable grounds. It was a hopeless and unmeritorious application from the outset, based on spurious grounds.

27 The worker's continued reliance on these grounds, knowing them to be false, and his other aforementioned conduct in pursuance of the matter also constituted unreasonable, frivolous and, at times, vexatious conduct.

28 The qualifying criteria of s 95(3) is easily established.

29 Parliament's intention in enacting s 95(3) was to inhibit the very unmeritorious, time consuming and expensive litigation that has taken place in this instance. On any scale of unreasonableness, this must rank at or near the top.

30 I order that the worker pay the respondent's costs of the substantive proceedings. I certify that the briefing of Senior Counsel by the respondent's solicitors was appropriate.

31 The worker's application for costs in the nature of disbursements, save for those that may have been reasonably incurred specifically in connection with the judicial determination of the preliminary jurisdictional point, is refused.

Parties are advised that if a party wishes to appeal against any part of this decision which is appealable pursuant to s 86(1) of the Act such appeal must be filed with the Registrar in accordance with Form 11 within 14 days of the delivery of this decision and must be served on all parties.