Lipman and another v A G Lifestyle

APPELLANTS Ms K Nomchong of counsel Solicitor: Mr A Shanahan Shanahan Tudhope LEGAL REPRESENTATIVES: RESPONDENTS Solicitor: Mr T Unsworth Tress Cocks & Maddox

JUDGMENT: - 5 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

BRIGITTE LIPMAN AND ANOTHER v A G LIFESTYLE MANAGEMENT PTY LIMITED AND OTHERS

Application by Brigitte Lipman for leave to appeal and appeal against the decision of Justice Schmidt given on 23 May 2003 in matter No 3967 of 2000 JUDGMENT [2003] NSWIRComm 188

1 On 13 June 2003 Brigitte Lipman and Gary Cecil Lipman ("the appellants") filed an application for leave to appeal and appeal against a decision and orders of Schmidt J in Lipman and Anor v AG Lifestyle Management Pty Limited and Anor [2003] NSWIRComm 160 delivered on 23 May 2003 and orders made by her Honour on 11 July 2003 requiring the appellants to pay the costs of A G Lifestyle Management Pty Limited and Amanda Gore ("the respondents").

2 The application in respect of which Schmidt J gave judgment on 23 May 2003 was an application under s 106 of the Industrial Relations Act 1996 by the appellants. The application was dismissed so that the only order sought to be stayed is the costs order made by her Honour on 11 July 2003.

3 The application for leave to appeal and appeal contained a stay application on the ground that: The applicants will have to meet a substantial costs order in favour of the Respondents, said to be in excess of $100,000, and the assessment of the said costs and will require the expenditure of resources on that which may be and, at least arguably is, rendered nugatory and otherwise wasteful.

4 The application for a stay came before the Commission on 20 June 2003 when it was adjourned pending the making of any orders by Schmidt J in relation to costs. The matter was re-listed for hearing on 22 July 2003 when Ms K Nomchong of counsel appeared for the applicants and Mr T J Unsworth, solicitor, appeared for the respondents.

5 Ms Nomchong elaborated on the ground in support of the stay. Ms Nomchong's submission may be summarised as follows: (i) The appellants were caretakers in a caravan park near Cooma New South Wales. Their rate of pay was $45,000 per annum between the two of them. They worked in excess of 50 hours per week and rarely took holidays. The terms of their employment contracts were unfair and they were dismissed at the instigation of the second respondent in unfair circumstances. (ii) The second respondent resides in the United States of America and has little, if any connection, with New South Wales. (iii) Similarly, the first respondent is a company whose only directors and shareholders are the second respondent and her mother. (iv) To the appellants' knowledge, the respondents do not have any assets in the jurisdiction. (v) If the costs order is not stayed, the appeal may be rendered nugatory as the substantial costs (considered by the respondents to be in excess of $100,000) are likely to be dissipated from the jurisdiction. (vi) The reason that these factors are important lies in the fact that if the costs order is not stayed and the appellants are required to meet pay out the costs prior to the hearing of the appeal, their ability to recover those costs, if the appeal is successful, are compromised. (vii) Further, the effect of not staying the costs order would be to inhibit or even prevent the appellants from pursuing the appeal. (viii) The appellants are an elderly couple who are currently working in a nursing home. (ix) By way of analogy, one matter which the courts are required to take into account in considering an application for security of costs is whether the making of the order would unduly stultify the ability of the applicant to pursue the proceedings: Trade Stock Pty. Limited v TNT (Management) Pty. Limited (1977) 14 ALR 52; Jeffcott Holdings Limited v Paior (1997) 15 ACLC 28. (x) If the stay order is not made, this would unduly inhibit or stultify the appellants from pursuing the appeal. (xi) The appeal itself involves issues as to errors of law and fact. Some of the issues to be determined involve matters going to the nature of the jurisdiction. These include: (a) what constitutes a contract or arrangement or collateral arrangement for the purpose of attracting jurisdiction under section 106; (b) the identity of parties against whom orders can be made; (c) whether, as a specialist jurisdiction, the Commission may take judicial notice of what is considered to be a fair wage for work performed; (d) whether the pleadings strictly bind the parties as to the ambit of their claim; (xi) There is an arguable case in relation to an appeal on the findings and determinations made by the learned judge in relation to each of those matters (and others). Further, it is in the public interest that the nature and scope of the jurisdiction be applied evenly and properly. (xii) The respondents have adduced no evidence to any prejudice that may be suffered if a stay order is made and nor could they. Their position is protected in that if the Appellants are ultimately unsuccessful, then it is open to the Respondents to seek an order for interest on the judgment monies. (xiii) The balance of convenience would favour an order staying the said orders.

6 Mr Unsworth opposed the appellants' application for a stay. Mr Unsworth interpreted the stay application as one being based on the limited ground that the appellants would have to go through the process of having costs assessed which would involve expense, such expense being thrown away if the appellants were successful on appeal. It may be that the ground in support of the stay application could have been more clearly expressed but I consider it is also open to the interpretation that the appellants were not only concerned with the situation Mr Unsworth understood to be the case but also with having to meet a bill of $100,000 or more. 7 Despite his understanding of the basis for the stay application, Mr Unsworth sought to deal with the submissions made by the appellants. Firstly, he contended that the appellants' concern in relation to the prospect of not being able to recover judgment in the event of success on the appeal was in reality a question going to security of costs. He submitted that if the respondent had been put on notice that such a point was to be taken the respondents could have called evidence about their assets and proposed an appropriate course. Mr Unsworth further submitted that there was no evidence to support the appellants' contention that the appellants would not be able to pursue the appeal if the costs order was not stayed. Mr Unsworth submitted the respondents were entitled to the fruits of the judgment in their favour.

8 As matters presently stand, and having regard to the principles laid down by the Court of Appeal in Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685, I do not propose to grant the stay order as to costs sought by the appellants. The onus is upon the applicant for a stay to demonstrate a proper basis for a stay that will be fair to all the parties. The contentions regarding the prospect of the appellants being unable to recover any judgment and, that if a stay is not granted this would inhibit the appellants from pursuing the appeal, were not substantiated by any proper evidence. If such evidence had been adduced I may have been more sympathetic to the application given that, for the purpose only of determining the stay application, I would have been prepared to accept the appellants at least had an arguable case.

9 The most appropriate course in my opinion is, in the absence of agreement, for costs to be assessed in accordance the orders made by Schmidt J. If the appellants are successful in their appeal any expenses relating to assessment of costs would be encompassed in any costs order in favour of the appellants. The parties should also meet with a view to resolving the appellants' concern over security of costs. If the appellants are able to convince the respondents of their difficulty in pursuing the appeal in the event they are required to meet the respondents' costs, as agreed or assessed, the parties should come to some arrangement in that respect. If no agreement can be reached the appellants are at liberty to have the matter re-listed before me at short notice. Before doing so, however, the appellants should file and serve any affidavit material that may be relevant to support the stay application. _______________________

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