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[2020] QIRC 191
procedural. Mr Maher was ordered to pay Isaac Regional Council $12,000 in costs within 28 days, covering both the reinstatement application and the costs application.
The Commission did not order costs simply because Mr Maher discontinued his reinstatement case. It accepted that, when he filed, he had arguable complaints about how some disciplinary allegations were described and could reasonably have hoped to recover from illness. But it found that the position had changed by 11 February 2020. By then, the Council had explained why Mr Maher’s prolonged illness appeared to make reinstatement impracticable and compensation unavailable. Because he continued the case after that point, the Commission ordered him to pay the Council a global $12,000 in costs. The Commission selected an amount below the Council’s substantially higher claim, taking account of the work actually incurred, the case’s procedural history and Mr Maher’s circumstances.
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9 cited instruments linked from this judgment.
In Maher v Isaac Regional Council [2020] QIRC 191, McLennan IC determined an application for costs after Trevor Maher discontinued his reinstatement proceeding against Isaac Regional Council. The judgment identifies the costs proceeding as one arising from a termination dispute. The underlying application was filed on 30 May 2019 after the Council dismissed Mr Maher by letter dated 10 May 2019 ([1]-[3]).
The Council’s investigation began in May 2018 and concerned allegations of misconduct. Mr Maher was suspended on pay while the investigation and show-cause process took place. The Council said that an external investigator substantiated one or more sub-allegations within 11 of 15 allegations. The Council relied in part on admissions and non-denials in its account of the process ([2], [22]). Mr Maher disputed allegations and raised, among other matters, the adequacy of the particulars in the show-cause notice, his disciplinary record, factual disputes, and the circumstances involving a “bite stick” ([19]).
The reinstatement proceeding was conciliated but did not settle. Directions required the parties to exchange statements of facts and contentions, witness lists and evidence. At a mention on 1 June 2020, Mr Maher indicated that he would discontinue. The hearing dates were vacated, and the Commission directed the parties to negotiate about costs and, failing agreement, file submissions ([3]-[6]). The Commission then had two questions: whether costs should be ordered and, if so, in what amount ([7]).
The Commission ordered Mr Maher to pay the Council $12,000 within 28 days. The order covered the costs of both the reinstatement proceeding and the costs application ([84], [88]-[89]). It did not find that Mr Maher had brought the application without reasonable cause at its commencement. Rather, it found that the application’s prospects changed as the proceeding progressed, and that by 11 February 2020 it should have become apparent that there was no reasonable prospect of success ([60]-[68]).
The Commission began with the statutory starting point: parties ordinarily bear their own costs in Commission proceedings. That default exists so as not to discourage people from pursuing industrial entitlements, and the Commission stated it is “not easily disturbed” ([11]). Section 545(2)(a) of the Industrial Relations Act 2016 (Qld) provides exceptions where a party made or responded to an application vexatiously or without reasonable cause, or where it would have been reasonably apparent that the application had no reasonable prospect of success ([9], [14]).
The Council did not pursue the allegation that Mr Maher acted vexatiously. Its case was that costs could be ordered under the other statutory grounds ([12]-[14]). The Commission treated the two relevant grounds as distinct. “Without reasonable cause” focused on the circumstances apparent when proceedings were instituted. The reasonable-prospects criterion permitted consideration of what became apparent later as the case developed.
On the first ground, the Commission was cautious about making a finding that an application was brought without reasonable cause. It referred to the approach in Kanan v Australian Postal and Telecommunications Union and Yousif v Workers’ Compensation Regulator: the matter is not decided simply because an application ultimately fails; the question is whether it could succeed when made ([16]-[18]). The Commission also referred to the high threshold expressed in General Steel Industries Inc v Commissioner for Railways (NSW), which warns against preventing a party from having a real question determined in the ordinary way ([18]).
Mr Maher’s procedural objection was sufficiently arguable to prevent a finding that the case was plainly without reasonable cause. Regulation 283 of the Local Government Regulation 2012 (Qld) requires notice of the proposed disciplinary action, its grounds and particulars of the conduct, together with a reasonable opportunity to respond ([27]). Applying Promnitz v Gympie Regional Council, the Commission explained that the required particulars must appear in the notice itself, not merely in an earlier investigation process ([28], [37]).
The Commission examined examples. Some allegations lacked dates, particular words or identifying context ([30]-[31]). Others, including the “fine as many people as possible” allegation, did not explain clearly how the alleged words warranted a disciplinary penalty or how they breached a policy ([32]-[33]). The “bite stick” allegation did not specify how Mr Maher had allegedly permitted possession or explain the relevant restriction ([34]). The recording allegations did not explain how the conduct breached a policy, code or law ([35]). The Commission considered that an employee should not be expected to “connect the dots” between allegations and policy provisions where the connection was not clear ([36]). It held that these matters raised an arguable point, though it did not decide that Mr Maher would have succeeded at a hearing ([38]-[39]).
The Commission also rejected the Council’s contention that reinstatement was obviously unavailable from the outset. Sections 321 and 322 of the IR Act provide for reinstatement or re-employment, with compensation available only if those remedies are impracticable and subject to a statutory cap ([40]-[41]). The Council’s opposition and loss of trust and confidence were relevant, but not conclusive. The Commission considered the evidence available at filing, not just what became known later ([42]-[49]). It found insufficient evidence that Mr Maher knew or ought to have known then that his illness would persist for so long or that restructuring had made reinstatement impracticable ([50]-[54]). That, combined with the arguable procedural issue, meant that the application was not shown to have been brought without reasonable cause ([58], [60]).
The second statutory ground produced a different result. By 11 February 2020, Mr Maher had been unfit for work for about 18 months. The Council’s letter offered $10,000 to discontinue and set out its reasons for saying that his illness prevented reinstatement and that compensation for lost wages was unavailable ([66]). The Commission considered that, by then, it was no longer reasonable to expect that he would recover sufficiently to return to work in the near future. It also reasoned that the compensation provision could not assist if reinstatement or re-employment was not a realistic remedy, and that the compensation cap was linked to wages during the six months after dismissal. The Commission found that Mr Maher had been unfit during that period and had exhausted his sick leave before dismissal ([61]-[67]).
The Commission therefore found that the lack of reasonable prospects should have become apparent on 11 February 2020. Mr Maher continued the case until shortly before the hearing was due to begin. The Council incurred further costs in preparing and filing materials, including affidavits for 12 witnesses ([68], [82]-[83]).
The judgment applies existing statutory provisions and cited authorities; it does not purport to create a new statutory test. The starting point remains that parties bear their own costs in Commission proceedings. Section 545(2)(a) creates an exception, but the Commission stressed both the need to satisfy a statutory criterion and the discretionary nature of any order ([9], [11], [85]-[87]).
For applications said to be “without reasonable cause”, the judgment applies a demanding, cautious inquiry focused on what was apparent when the case began. A proceeding is not without reasonable cause merely because it later fails. If a real or arguable issue exists, summary characterisations such as “manifestly groundless” are inappropriate ([16]-[18], [23]-[24]). The judgment’s treatment of the particularisation issue illustrates that an arguable procedural defect may be enough to defeat this costs ground without establishing that the applicant would ultimately win ([38]-[39]).
The distinct “no reasonable prospect of success” ground can take account of developments after filing. The Commission cited Baker v Salver Resources Pty Ltd for the proposition that reasonable prospects involve an objective assessment ([59]). In this case, the initial position and the later position were not treated as identical. Mr Maher’s prospects were not entirely absent at filing, but the Commission found that prolonged illness and the Council’s February 2020 correspondence changed the assessment ([60]-[68]).
The judgment also applies the local government disciplinary notice requirement in reg 283. It relies on Promnitz for the proposition that particulars must be in the notice itself and that compliance with the prescribed process is mandatory ([27]-[28], [37]). The Commission’s reasoning does not determine whether every allegation was legally deficient or whether the dismissal was ultimately harsh, unjust or unreasonable. Its narrower conclusion was that some objections were arguable at the time the reinstatement case began ([38]-[39]).
On remedies, ss 321 and 322 provide the statutory framework discussed in the judgment. The Commission treated reinstatement or re-employment as the ordinary remedy if unfair dismissal is established, while compensation is available only if reinstatement or re-employment is impracticable ([40]-[41]). The judgment’s costs conclusion depended on its assessment of how illness affected the availability of those remedies and on the compensation limit described in the reasons ([61]-[67]).
Finally, the statutory threshold does not make costs automatic. The Commission expressly accepted that the word “may” gives it discretion, relying on Du Preez v Chelden (No. 2) ([86]). The decision therefore applied a two-stage approach: determine whether a statutory basis exists, then decide whether to exercise the discretion and what amount is appropriate.
At [11], the Commission says the ordinary position is that each party bears its own costs and that this position is “not easily disturbed”. In plain English, a party does not normally have to pay the other side’s legal costs merely because it loses or discontinues. A statutory exception must be established.
At [23], the Commission cautions that the costs question is “not merely” whether Mr Maher would have succeeded at the hearing. That distinguishes the costs test from a prediction of the substantive result. The Commission had to ask whether the statutory costs criteria were met, including what was apparent when the case began and what became apparent as it progressed.
At [36], the Commission says the Council had listed factual allegations and policy extracts and expected Mr Maher to connect them. The plain-English point is that the notice had to explain the alleged conduct and the relevant breach clearly enough to allow a fair response. The fact that Mr Maher did respond did not, by itself, remove the arguability of his objection.
At [49], the Commission says, “What is relevant is the information available to Mr Maher at the time of filing.” That is the temporal lens for the without-reasonable-cause inquiry. Later illness or restructuring could not simply be projected backwards to show that the original application was unreasonable.
At [60]-[68], the Commission distinguishes the filing date from 11 February 2020. It accepted that there were some reasonable prospects at filing, but found that continuing after the February correspondence meant the lack of prospects should have become apparent. In plain English, a case that was arguable at the outset may later reach a point when continuing it attracts a costs risk.
At [86], the Commission states that even a finding that an application was made without reasonable cause or had no reasonable prospect of success “does not mandate an order for costs”. The statutory trigger opens the door to an order; it does not dictate one or determine its amount.
This decision is relevant to costs applications in Queensland Commission proceedings where a party alleges that a termination or reinstatement application had no reasonable prospect of success. Its central factual feature is a changing evidentiary and remedial position: the employee had arguable procedural points and a possible basis for hoping to return to work at filing, but prolonged illness later undermined the availability of reinstatement and the alternative compensation route ([38]-[39], [49]-[50], [60]-[68]).
The decision also matters where disciplinary allegations are set out in a notice that may not adequately identify dates, words, context, or the connection between alleged conduct and a policy breach. The Commission considered whether the shortcomings were arguable under reg 283, while expressly avoiding a final ruling on whether those shortcomings would make the dismissal harsh, unjust or unreasonable ([27]-[39]).
For the reasonable-prospects ground, the relevant factual pattern includes a clear later communication identifying why the claim may fail, followed by continued prosecution and further costs to the other party. Here, the Commission identified the Council’s 11 February 2020 letter as the point when the absence of reasonable prospects should have become apparent ([66]-[68]). The judgment does not establish that any settlement offer will have that effect: its reasoning refers to the content of the letter, Mr Maher’s illness and the duration of his incapacity.
The decision also addresses costs quantum where a matter is discontinued before hearing but after substantial preparation. The Commission considered witness affidavits, disclosure, mentions, the costs scale, the scale category used in the Council’s calculation, and the applicant’s circumstances ([73]-[84]). It does not set a fixed tariff for discontinued termination disputes.
The supplied judgment contains no discussion of subsequent decisions treating Maher as a precedent. It was delivered on 15 October 2020, and the material provided identifies cases that the Commission itself considered or cited, rather than later judicial treatment of Maher. On this source alone, it is not possible to say whether later courts followed, distinguished, limited or otherwise treated the decision.
Within Maher, the Commission applied or discussed a number of earlier decisions. It used Kanan, Yousif and General Steel in explaining the caution and threshold relevant to the without-reasonable-cause inquiry ([16]-[18]). It applied Promnitz to the notice and particularisation issue ([28], [37]). It referred to White for discussion of impracticability and reinstatement ([43]), and to Baker for the objective character of the reasonable-prospects assessment ([59]). For costs quantum, it considered Fraser Coast Regional Council v Alderton and Blackbird Energy Pty Ltd v Turner, and referred to Greenwood as another example of a global costs approach ([71], [77]-[80]).
Those references describe the reasoning in Maher, not later treatment of Maher itself. A broader account of subsequent treatment would require later decisions not included in the judgment supplied here.
The judgment did not decide the substantive reinstatement application. In particular, it did not determine whether the termination was harsh, unjust or unreasonable, whether the particularisation defects ultimately invalidated the disciplinary process, or whether any of the contested misconduct allegations were substantiated. The Commission expressly said that its finding about the procedural issue was only that it was arguable, not that Mr Maher would have succeeded ([38]-[39]).
The decision also does not give a universal point at which illness makes reinstatement impracticable. Its conclusion was tied to the evidence about Mr Maher’s illness, the period he had been unfit, the Council’s letter and the remedy provisions. The Commission noted the absence of evidence that, when the application was filed, he knew or ought to have known that his illness would continue for such an extended period ([49]-[50], [66]).
Nor does the judgment establish a general rule that an employer’s loss of trust and confidence makes reinstatement impossible. It treated that as one factor and observed that the employer’s opposition is not a conclusive barrier ([42]-[47]). Whether reinstatement is impracticable depends on the evidence and circumstances considered under the statutory scheme.
Finally, the Commission did not prescribe how costs should be calculated in every discontinued proceeding. It made a global assessment, taking account of the costs incurred after 11 February 2020, the Council’s costs materials, the Magistrates Court scale, the work performed, and Mr Maher’s circumstances ([70]-[84]). The amount of $12,000 is the order in this case, not a general benchmark.
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The applicant referred the Commission to Perkins v Grace Worldwide (Aust) Pty Ltd where the Full Bench of the Fair Work Commission wrote:
"Trust and confidence are concepts of degree. It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.
It may be difficult or embarrassing for an employer to be required to re-employ a person the employer believed to have been guilty of wrongdoing. The requirement may cause inconvenience to the employer. But if there is such a requirement, it will be because the employee's employment was earlier terminated without a valid reason or without extending procedural fairness to the employee. The problems will be of the employer's own making. If the employer is of even average fair-mindedness, they are likely to prove short-lived. Problems such as this do not necessarily indicate such a loss of confidence as to make the restoration of the employment relationship impracticable."
Whilst I accept that it may be inconvenient or difficult for the respondent to reinstate the applicant, it is nevertheless, in my view, not impracticable for them to do so. In Auto Logistics Pty Ltd v Kovacs de Jersey P considered the meaning of word "impracticable". His Honour concluded:
"That word does in my view bear its ordinary meaning, and it is not enough, to establish practicability, to show that restoration of employment would be merely inconvenient or difficult. As the dictionaries confirm, the word means practicably impossible."
It is evident from the CEO's Affidavit that the reinstatement for which (Mr Maher) contended would appear not to be feasible. With that development, the Applicant's prospects of an order for back-pay also disappear.
(Mr Maher) has been unable to work due to his psychological condition. He was granted New Start Allowance from 3rd March 2019, and remains on that to this point, with the exception of 10th May 2019 to 24th August 2019 where he lived on the payout of his long service leave.
Significant structural changes have been made to the organisation since (Mr Maher's) employment was terminated.
Reinstatement to (Mr Maher's) position is not possible, because that position has been changed to incorporate broader responsibilities and has been filled by another person appointed in good faith.
Would it have been reasonably apparent to Mr Maher that his Reinstatement Application had no reasonable prospect of success?
Professional costs: $34,563.53 (with an additional $6,912.70 as a 20% "care and conduct allowance")
Total (exclusive of 20% allowance): $48,888.53
Total (inclusive of 20% allowance): $55,801.23
Leaving aside the costs incurred by Blackbird in mounting the current application pursuant to s. 335 of the Act, the materials filed with the Affidavit of Ms Foreman disclose that Blackbird incurred professional fees for its solicitor and counsel in the amount of $73,634.46. However, $11,908.22 of this amount is shown to be in respect of "Misappropriation of Funds". Whether that relates to the present application or other matters is unclear. The remainder, in the amount of $61,726.24, is said to be in relation to "Donna Turner- dismissal". However, apart from a detailed invoice from counsel to Blackbird's solicitors the make up of the professional fees claimed is not disclosed.
Without in any way suggesting doubt about the bona fides of the professional fees charged, I have decided that whilst Blackbird is certainly entitled to recover a proportion of its cost, I should pay greater regard to the published Scale of Costs (without necessarily adopting it) rather the costs actually incurred, and to take into account all of the circumstances of the case. This includes Ms Turner's modest financial circumstances and the fact that the case was likely to involve a one day trial even if Ms Turner had admitted all of the issues canvassed above.
In the end result I have decided to award costs on a global basis in the quantum of $16,000 with such payment to be made within 22 days of the date of release of this decision. Such amount is generally calculated on the premise that costs for 2 days of trial and 4 days of preparation (for solicitor and counsel) were unnecessarily incurred by Blackbird.
But, the presence of a finding that an application was made without reasonable cause or that an applicant had no reasonable prospect of success, does not mandate an order for costs in favour of the opponent. Section 545(2) provides a discretion to make such an order.
[2] A Form 27 Notice of Discontinuance has subsequently been filed.
[3] Although Isaac Regional Council's submissions are in substance an Application in an Existing Proceeding, for convenience and the avoidance of confusion I have referred to the parties in this Decision as they appear in the substantive Application for reinstatement: Mr Maher as the Applicant, and Isaac Regional Council as the Respondent.
[6] Affidavit of Ms R. Pezzutti filed 22 June 2020, exhibit RMP-3.
[7] Submissions of the Council filed 22 June 2020, [1], [5].
[8] Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257, 29.
[9] Yousif v Workers' Compensation Regulator [2019] ICQ 10, [31], citing MIM Holdings Limited v Automotive, Metals, Engineering, Printing and Kindred Industries Industrial Union of Employees Queensland [2000] QIC 37; (2000) 164 QGIG 370, 371.
[10] Re Christina Hatchett v Bowater Tutt Industries Pty Ltd (No 3) [1991] FCA 188; (1991) 39 IR 31, [8] followed in Walker v Mittagong Sands Pty Limited T/A Cowra Quartz (2011) 210 IR 370.
[11] General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125, 129-130.
[12] A type of stick, similar to a police baton.
[13] Affidavit of Ms R Molineaux (nee Haldane) filed 29 May 2020, Exhibit RH-10.
[14] Affidavit of Mr T Maher filed 30 May 2019, Exhibit G.
[15] Wang v Crestell Industries Pty Ltd (1997) 73 IR 454, 463, followed in Blows v Townsville City Council [2016] QIRC 066, [68].
[16] Promnitz v Gympie Regional Council [2015] ICQ 011, ('Promnitz').
[17] Local Government Regulation 2012 (Qld) reg 283.
[18] Promnitz v Gympie Regional Council [2015] ICQ 011, [26].
[20] White v State of Queensland (Central Queensland Hospital and Health Service) [2017] QIRC 041, [86]-[89].
[21] Affidavit of Ms R Pezzutti filed 22 June 2020, Exhibit RMP-7.
[22] Affidavit of Mr T Maher filed 15 May 2020, [82]-[84].
[23] Bow Park Pty Ltd v Williams (No. 2) [2003] QIC 175; (2004) 175 QGIG 18, cited in Du Preez v Chelden (No. 2) [2020] ICQ 015, [12].
[24] Submissions of Mr Maher filed 3 July 2020, [55]; Affidavit of Ms R Pezzutti filed 22 June 2020, Exhibit RMP-7.
[25] Application for Reinstatement filed by Mr Maher on 30 May 2019, page 3.
[27] Acts Interpretation Act 1954 (Qld) sch 1, definition of 'month' and definition of 'calendar month'.
[28] Applicant's Statement of Facts and Contentions, filed 23 March 2020, [6] - [13].
[29] Industrial Relations (Tribunals) Rules 2011 (Qld) r 70.
[30] Affidavit of Mr Maher filed 30 May 2019, exhibit A.
[31] Blackbird Energy Pty Ltd v Turner [2007] QIRComm 34; (2007) 185 QGIG 81.
[33] Greenwood v State of Queensland (Sunshine Coast Wide Bay Health Service District) [2016] QIRC 125.
[35] Du Preez v Chelden (No. 2) [2020] ICQ 015, [11].
Maher
Isaac Regional Council [2020] QIRC 191
Blows v Townsville City Council [2016] QIRC 066
Bow Park Pty Ltd v Williams (No. 2) [2003] QIC 175; (2004) 175 QGIG 18
Du Preez v Chelden (No. 2) [2020] ICQ 015
General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125
Greenwood v State of Queensland (Sunshine Coast Wide Bay Health Service District) [2016] QIRC 125
Industrial Union of Employees Queensland [2000] QIC 37; (2000) 164 QGIG 370
Promnitz v Gympie Regional Council [2015] ICQ 011
Re Christina Hatchett v Bowater Tutt Industries Pty Ltd (No 3) [1991] FCA 188; (1991) 39 IR 31
White v State of Queensland (Central Queensland Hospital and Health Service) [2017] QIRC 041
Yousif v Workers' Compensation Regulator [2019] ICQ 10
As I have said, some of these expressions occur in cases in which the inherent jurisdiction was invoked and others in cases founded on statutory rules of court but although the material available to the court in either type of case may be different the need for exceptional caution in exercising the power whether it be inherent or under statutory rules is the same. Dixon J. (as he then was) sums up a number of authorities in Dey v. Victorian Railways Commissioners [1949] HCA 1; (1949) 78 CLR 62 VOL CXII-9 where he says (1949) 78 CLR, at p 91; 'A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process.'
(1992) 43 IR 257
(1991) 39 IR 31
(1964) 112 CLR 125
(2011) 210 IR 370
(1997) 73 IR 454
(1949) 78 CLR 62
Mr Maher was ordered to pay Isaac Regional Council $12,000 in costs within 28 days, covering both the reinstatement application and the costs application.