Pascale Bourot v New South Wales Department of Public Works and Services & Anor

Industrial Relations Commission (NSW)|2004-03-09|Before: Schmidt J, Haylen J, Curtis AJ, Wright P, Einstein J, Marks J

Industrial Relations Commission of New South Wales in Court Session

CITATION : Pascale Bourot v New South Wales Department of Public Works and Services & Anor [2004] NSWIRComm 72 APPELLANT: Pascale Bourot

PARTIES : FIRST RESPONDENT: NSW Department of Public Works and Services

Industrial Relations Act 1996 s 181(1) Occupational Health and Safety Act 1983 Protected Disclosures Act 1994 LEGISLATION CITED : Land and Environment Court Act s 69 Industrial Relations Commission Rules Pt 27 r 211 Supreme Court Act s 76

Allesch v Maunz (2000) 203 CLR 172 Bank America Finance Ltd v Nock (1988) 1 AC at 11012 Commissioner for Children and Young People v "A" (No 2) [2004] NSWIRComm 8 Hagan v Waterhouse (No 2) (1992) 34 NSW 400, Health and Research Employees Association of New South Wales v Baptist Community Services NSW and ACT (2002) 122 IR 178 June Morgan v The New South Wales Department of Education and Training (Wright P, IRC 2002/685, unreported, 9 March 2004) Latoudis v Casey (1990) 170 CLR 534 CASES CITED : Mayer v Harte [1960] 1 WLR 770 Milpurrurra v Indofurn Pty Ltd (unreported Federal Court of Australia dated 27 May 1997) Norbis v Norbis (1986) 161 CLR 513 at 537 Orellana-Fuentes v Standard Knitting Mills Pty Ltd and anor (2003) 57 NSWLR 282 Oshlack v Richmond River Council (1998) 193 CLR 72 Police Association of New South Wales v Commissioner of Police (2002) 123 IR 301 Schipp v Cameron, unreported judgment dated 12 October 1998, Supreme Court, Einstein J United GlobalCom,Inc and Ors v McRann (No 2) [2004] NSWIRComm 16 Vucadinovic v Lombardi and Anor [1967] VR 81 HEARING DATES: 02/20/2004 DATE OF JUDGMENT: 04/08/2004

APPELLANT: Mr G Crewdson (as agent)

RESPONDENTS: LEGAL REPRESENTATIVES: Mr S Benson of counsel SOLICITORS: IV Knight Crown Solicitor

JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION FULL BENCH

CORAM: Schmidt J Haylen J Curtis AJ DATE: 8 April 2004

Matter Number IRC 5152 of 2002 PASCALE BOUROT v NSW DEPARTMENT OF PUBLIC WORKS AND SERVICES AND ANOTHER Application by Pascale Bourot for leave to appeal and appeal against a decision of Justice Marks given on 22 August 2002 in Matter Number IRC 5810 of 2000 JUDGMENT OF SCHMIDT J AND CURTIS AJ

1 This judgment deals with the question of the costs of the appeal, judgment in which was given on 5 December 2003. Leave to appeal was at that point granted in respect of only one of the matters raised on the appeal, namely the correction of the judgment of Marks J, given on 22 August 2002. The respondents consented to the making of that order. Leave to appeal was otherwise refused and the question of costs reserved.

2 The respondents filed written submissions in relation to the question of costs on 22 December 2003, seeking a relisting of the matter for hearing of that question.

3 There was no appearance for the appellant Ms Bourot, either when the matter was mentioned, or when it came on for hearing on 20 February 2004. On each occasion a written communication was received from Mr Crewdson, the agent appearing for Ms Bourot, advising that he could not appear.

4 The correspondence filed by Mr Crewdson on the afternoon of the hearing made an application for an adjournment, on a number of bases, including a lack of notice of the hearing and a difficulty in obtaining instructions from Ms Bourot. Despite the documents having been filed in the Registry that afternoon, later that day there was no appearance at the hearing by either Mr Crewdson or Ms Bourot. The adjournment application was opposed by the respondents, complaint being advanced at the approach adopted by the appellant to the application.

5 The adjournment application was not granted, but Ms Bourot was given 14 days within which to file any written submissions upon which she wished to rely. The respondents relied upon the written submissions filed in December. The Registrar gave the appellant written advice of the Full Bench's orders on 23 February.

6 There was further communication from Mr Crewdson. On 5 March, in a document filed that day, Mr Crewdson made various submissions regarding the filing of Ms Bourot's submissions on costs. Mr Crewdson sought that the Court's orders be set aside and that the matter of costs not be dealt with, until other proceedings before the Commission, in which Mr Crewdson himself is the applicant, had been dealt with. He also advised that he had been unable to consult with Ms Bourot, or to obtain instructions from her.

7 Complaint was also made that the Full Bench had dealt with the matter in the absence of either Ms Bourot or Mr Crewdson on 20 February. This was argued to have amounted to a denial of natural justice. Having considered the document filed, the Full Bench extended the time given to Ms Bourot for the filing of submissions on costs to 23 March. The Registrar gave the appellant written advice of the Full Bench's orders on 9 March.

8 On 23 March a further document was filed by Mr Crewdson pressing for an indefinite adjournment. Mr Crewdson asserted that he still had been unable to attend to the appellant's submissions on costs, had no instructions and asked that the Court 'cease issuing what to me are oppressive demands and directions that I do not have the resources, time or strength to meet at the moment. Will you please wait until I am able to deal properly with these matters.'

10 The respondents sought an order for costs in their favour, submitting that this should follow because they were the successful parties on the appeal, having regard to the various complaints traversed by the appellant in the notice to appeal, in respect of which the Full Bench had refused to grant leave. The only matter in respect of which leave was granted, the correction of one word in the judgment appealed against, could easily have been remedied by a proper application brought under the slip rule.

11 It was submitted that in the circumstances, as a matter of fairness, the usual costs rule should be followed, with an order for costs made in favour of the respondents. The appellant's failures to rectify deficiencies in the appeal book, also dealt with by the Full Bench as earlier constituted, were also relied upon.

12 As to the correction of the judgment of Marks J, it was submitted to be relevant that the appellant had approached the Court informally, by way of correspondence, about that concern. This was submitted to have been an inappropriate course in the circumstances and one adopted without the respondents being informed. The respondents were not made aware of what had occurred until the notice of appeal was served.

13 The correct procedure would have involved the filing of a notice of motion. The appellant was argued to have been well aware of the inappropriateness of the correspondence sent to the Court, given what had transpired upon earlier occasions in the proceedings below. It was also submitted to be relevant that although Marks J had, in fact, listed the matter, following upon the informal application made by the appellant, the appellant then failed to appear. Had she done so, the correction to the judgment complained about on appeal, could have been dealt with before Marks J.

14 It was also submitted that regard would be paid to suggestions made by the respondents that the Court approach the Law Society of New South Wales, with a request for assistance to be provided to the appellant pursuant to its pro bono scheme. The appellant advised the Court that she did not wish to have such assistance.

15 It was argued that the usual order as to costs should flow in the circumstances and that the difference in the parties' respective financial positions was not a matter which should properly be taken into account in the exercise of that discretion. It must be exercised judicially. See Oshlack v Richmond River Council (1998) 193 CLR 72 at 96, where it was observed that costs orders were not designed to punish the unsuccessful party, but to indemnify the party which has succeeded, unless by its misconduct the successful party disentitles it to the exercise of the discretion.

16 While finally no submissions on costs were filed for the appellant, in the document filed by Mr Crewdson on 5 March, reference was made to special circumstances in which the usual costs rule may be displaced, which were said to include circumstances where the conduct of the successful party had caused the litigation in the first place; where the successful party's conduct during the proceedings had been unreasonably obstructive and not bona fide and where the evidence revealed prima facie that the successful party had engaged in unlawful conduct.

17 It was argued that all three circumstances were here present, given evidence in the proceedings below and the way in which the respondents had conducted themselves in the proceedings. Reliance was placed upon conduct allegedly in breach of obligations imposed upon the respondents by the Occupational Health and Safety Act 1983. Reference was also made to the Court's power under s154 of the Industrial Relations Act 1996 ('the Act') to grant declaratory relief and to provisions of the Protected Disclosures Act 1994.

18 It was put that by awarding costs against the appellant the Court would, in effect, be rewarding the respondents 'for prima facie tortious and criminal conduct'.

19 Reference was also made to Commission for Children and Young People v "A" (No 2) [2004] NSWIRComm 8 and Police Association of New South Wales v Commissioner of Police (2002) 123 IR 301, where the usual costs orders were dispensed with. Analogies were sought to be drawn with the circumstances here before the Court and those which arose in these cases. It was said that the issues to be determined in this case affected large numbers of NSW public servants, given the role of HealthQuest. Here, like in Commission for Children and Young People, the appellant had been left with no choice but to seek declaratory relief, given the respondents' treatment of her.

21 The appellant complains about the opportunity which she was afforded to have her appeal dealt with, as well as the approach adopted by the Court in relation to the hearing of the question of costs. The attention which the Court would ordinarily expect a party or her agent to give to litigation which she has instituted in the Court, has not always been apparent in these appeal proceedings. This has arisen in circumstances where the Act permits a party to be represented by an agent. In exercising that right, the appellant has elected to be represented by Mr Crewdson, himself an applicant in other proceedings before the Court and the Commission.

22 Mr Crewdson is not legally qualified, a matter to which this Full Bench has paid regard in these proceedings. The submissions advanced by Mr Crewdson, in support of various applications for the appellant, have included an explanation as to his personal circumstances, how they have affected his ability to properly represent the appellant and the difficulties which he has had in communicating with her. Account has been taken of these matters by the Full Bench, when such applications have been considered.

23 The appellant also complains that she has been denied natural justice. As discussed by Kirby J in Allesch v Maunz (2000) 203 CLR 172 at 184-5, however, while the rules of natural justice require that a party be afforded an opportunity to be heard, the obligation is that the opportunity be given. The Court cannot require parties to take proper advantage of such an opportunity. That is a matter for them.

24 In this case, the appellant effectively seeks the indefinite delay of the hearing of the question of costs in this appeal. It would be most unusual for proceedings in this Court to be indefinitely delayed. Such a result could not properly flow, simply because a party who is on notice of a mention or hearing does not appear or elects to make written submissions in support of an adjournment application, instead of appearing. Nor could that result follow because a party persists in pressing the view that the Court should follow a different course to that which the Court has decided upon, having considered the submissions advanced by the parties to the proceedings, as to its proper conduct or disposal. Nor can indefinite delay result merely because a party's agent is engaged in pursuit of other litigation in the Court, the Commission or elsewhere, or is without sufficient time or resources to properly attend to the agency work which has been undertaken.

25 In this case, we are satisfied that the appellant has been given a proper opportunity of making submissions in relation to the question of the costs of the appeal, which is presently before us. By s162 of the Act, the Court is required to act as quickly as is practicable. Section 163 requires the Court to act according to equity, good conscience and the substantial merits of the case, without regard to technicalities or legal forms.

26 The appellant has been on notice of the respondents' submissions as to costs since the application made for a costs order, in December 2003. Despite failing to appear at the hearing in February, she was given a further period in which to make written submissions. That time was extended for a further period, in light of the submissions filed by Mr Crewdson. An indefinite delay of the hearing of the question of costs must be refused. Neither justice, nor the public interest, to which this Court must also give regard pursuant to s146 of the Act, could permit such a result, notwithstanding Mr Crewdson's difficulties.

28 At the hearing of the appeal the respondents acknowledged that they had not obtained an order that their costs of the interlocutory proceedings before Marks J, which they assessed as amounting to some $29,000, be paid forthwith. They also indicated that those costs would not be pressed until the final determination of the application below.

29 At the hearing of the costs of the appeal, the Full Bench also raised the question of the time at which the costs of this appeal might properly be payable to the respondents. The respondents' position was that costs were payable after the determination of the appeal, but that as a matter of the Court's discretion, they could be stayed pending the determination of the proceedings before Marks J.

30 The law in relation to the awarding of costs in matters before this Court is well settled. (See the discussion by another Full Bench in Commission for Children and Young People v "A" (No 2) ). The purpose of a costs order is not to punish or reward either party, but to ensure that as a matter of fairness, the successful party recovers costs which would not have been incurred if the litigation had not been brought, or defended, by the unsuccessful party.

31 The usual order as to costs is that the unsuccessful party should bear the costs of the successful party, as agreed or assessed. A departure from that approach ordinarily requires a finding that there has been some misconduct by the successful party, which must result in it being deprived of the costs order it would usually receive. There was nothing in the material before us, which, in our view, could properly lead to such a conclusion in relation to the respondents' resistance of the appellant's appeal. We are also satisfied that the respondents are entitled to be heard on their defence of the claims brought by the appellant below, as well as in relation to their defence of this appeal.

32 If the views expressed by Mr Crewdson in the document filed on 5 March as to the real nature of the respondents' conduct have a proper foundation, this will undoubtedly be revealed when the merits of the appellant's application are heard and determined. We note that those submissions were apparently put without instructions, although they reiterate submissions put at the hearing of the appeal. Assuming that they do reflect the appellant's views, we are still entirely of the view that the respondents are entitled to be heard in their defence of the claims brought. The seriousness of the allegations made, reinforce this conclusion.

33 That the party here seeking the costs order is a Government Department, is also not a proper reason for refusing to grant such an order. (See Oshlack at [92] to [97]). We are otherwise satisfied that the circumstances were not such that as a matter of justice between the parties there should be a departure from the usual costs order in this appeal.

34 It is relevant to this conclusion that the only matter in respect of which the appellant was granted leave to appeal, was in relation to a correction of the order appealed against, to which the respondents consented. It cannot be overlooked that this correction could have been dealt with before Marks J, when his Honour relisted the matter to deal with that question, at the appellant's request. The appellant did not appear before Marks J to have the matter dealt with on that occasion, having lodged this appeal, in the meantime.

35 The respondents otherwise successfully resisted the interlocutory appeal. We are entirely satisfied that there was no misconduct on their part in doing so.

36 The question of the time at which costs should be payable, is, however, a different matter. The interests of justice often require that in an interlocutory appeal, the costs of the appeal not become payable until the primary proceedings are concluded. There are circumstances in which it is appropriate to depart from this approach, as a matter of justice. (See the recent discussion of another Full Bench in United GlobalCom,Inc and Ors v McRann (No 2) [2004] NSWIRComm 16.) This is not one of them.

37 At the end of the day, a costs order must be directed to achieving justice between the parties. In this case, we are satisfied on the material before the Full Bench, that while the respondents must have a costs order in their favour, a proper exercise of the Court's discretion, must also have the result that the costs of this appeal should not be payable before the determination of the application below. To adopt any other course would be oppressive, given the appellant's personal circumstances. This would only be exacerbated if the end result were a series of interlocutory applications for taxation of costs.

38 Whether the respondents should, in fact, finally pursue the costs order which we feel bound to make, is also another matter. This is a consideration which not infrequently arises for successful litigants in proceedings before this Court, particularly in cases concerning employment. Undoubtedly, the respondents would consider any representations which the appellant might in due course wish to make in this respect. We are satisfied, however, that this would be a matter for appropriate consideration at senior levels within the respondents, but not a proper matter for decision by the Court.

39 For the reasons given, we would order that the appellant should pay the respondents' costs of the appeal, as agreed or assessed. That exercise must await the determination of the appellant's substantive application. JUDGMENT OF HAYLEN J

40 The circumstances leading the Court to consider this cost application have been adequately set out in the majority judgment. I have the misfortune of being in disagreement with the manner in which the majority propose to dispose of this application for costs. In my view the discretion to deal with costs, although to be exercised judicially, is wider than that which the majority would seem to accept.

41 The power to award costs is dealt within s 181(1) of the Act and in short, provides that the Commission may award costs and that the costs are in the discretion of the Commission and that the Commission may determine by whom and to what extent costs are to be paid. It is to be noted that this power is very similar to the costs power found in s 76 of the Supreme Court Act. The significance of that Act is the manner in which the majority in Oshlack dealt with a similar provision appearing in the Land and Environment Court Act and what was said generally about costs powers framed in the manner of s 76 of the Supreme Court Act.

42 As the headnote in Oshlack reveals the case commenced when an individual brought proceedings in the Land and Environment Court against a local Council and a land developer seeking to impugn the consent granted by the Council to a proposed development. The applicant had no personal interest in the outcome of the proceedings but was motivated by a desire to preserve the habitat of endangered fauna on and around the development site. The proceedings were dismissed but Stein J held that there should be no order as to costs. He took into account in particular that the proceedings had been motivated by a desire to ensure obedience to environmental law and to preserve the habitat of an endangered native animal on and around the site and that there was a public interest in the outcome of the proceedings. The basis of the challenge was arguable and it raised and resolved significant issues about the interpretation and future administration of provisions relating to protection of endangered fauna and the ambit of future administration of development consent which had implications for the Council, the developer and the public. Broadly speaking that judgment was overturned by the Court of Appeal applying the usual approach to a costs order.

43 In the High Court the majority (Gaudron and Gummow JJ in a joint judgment and Kirby J in a separate judgment) upheld the order of Stein J and set aside the judgment of the Court of Appeal. The joint judgment of Gaudron and Gummow JJ, after dealing with the history of similar costs provisions, referred to the judgment of Dawson J in Latoudis v Casey ( 1990) 170 CLR 534 to the effect that after the Judicature Acts, all costs were in the discretion of the court and while the discretion was absolute and unfettered it was to be exercised judicially, that is, not by reference to any irrelevant or extraneous considerations but upon facts connected with or leading up to the litigation (at paragraph [34]). Reference was made to the judgment of Brennan J in Norbis v Norbis (1986) 161 CLR 513 at 537 to the effect that it was one thing to say that principles may be expressed to guide the exercise of a discretion but it was another to say that the principles may harden into legal rules which would confine the discretion more narrowly than Parliament intended. The width of the statutory discretion was determined by the statute and it could not be narrowed by a legal rule devised by the court to control its exercise. It was in that sense that the early statement of the High Court was to be understood as to the existence of a general rule that a wholly successful defendant should receive his costs unless good reason was shown to the contrary (at paragraph [35]).

44 The Council had argued that under s 69 of the Land and Environment Court Act the exercise of discretion in relation to costs was to be determined from the perspective of the successful party, that the successful party ordinarily should be compensated by the unsuccessful party and the successful party would be deprived of costs only by disentitling conduct. It was also argued that these propositions would apply unless displaced by specific legislative provisions. These propositions were rejected in the joint judgment.

45 Reference was also made to the judgment of the court in Wentworth v Attorney-General to the effect that s 76 of the Supreme Court Act conferred a wide discretion on the court to decide whether and which party to the proceedings should pay the costs of the other party. The joint judgment then stated that there was no absolute rule with respect to the exercise of the costs power conferred by provisions such as s 69 of the Land and Environment Court Act, that in the absence of disentitling conduct, a successful party is to be compensated by the unsuccessful party, nor was there any rule that there was no jurisdiction to order a successful party to bear the costs of an unsuccessful party.

46 In paragraph [44] their Honours said that it may be true, in a general sense, that costs orders were not made to punish an unsuccessful party. However, in particular circumstances involving some relevant delinquency on the part of the unsuccessful party an order is made not for party and party costs but for costs on the solicitor and client basis or on an indemnity basis to more fully or adequately compensate the successful party for that disadvantage.

47 In his separate judgment Kirby J adopted a similar approach emphasising the broad and unfettered nature of costs powers. Such costs powers were not intended to confine the decision maker to a rigidly mechanical approach. It was also pointed that the Land and Environment Court was a specialised court enjoying a wide range of powers conferred upon it by a large body of legislation: When this background of special, and in some ways peculiar, legislation is recognised, it will be appreciated that the provisions of the Land and Environment Court Act as to costs appears in a statutory context which alters, to some extent, the assumptions upon which civil litigation in this country has, hitherto, ordinarily, taken place. [117]. Thus, it would be a mistake to ignore the functions, powers and peculiar procedural provisions governing the Land and Environment Court in the jurisdiction which it exercised.

At paragraph [111] Kirby J noted that a provision expressly empowering a determination as to "by whom and to what extent" costs were to be paid was a provision intended to enlarge the already general nature of the discretion granted to award costs and enhance the power of the court to assign the costs, in the appropriate quantum, to such persons before the court as the justice of the case required. That approach was reflected in Hagan v Waterhouse (No 2) (1992) 34 NSW 400, where Kearney J quoted with approval from an unreported Court of Appeal judgment delivered by Clarke J who stated: The overriding objective must be to make an order which is appropriate to the justice of the case (at 405).

48 These passages make it abundantly clear that while generally it may be expected that a successful party may obtain a costs order in its favour, it is not correct that only misconduct or some disentitling conduct by the successful party will disentitle it to a costs order in its favour. Section 181(1) of the Act, like s 76 of the Supreme Court Act and s 69 of the Land and Environment Court Act, confers a broad and unfettered discretion as to the awarding of costs, albeit, a discretion which must be exercised judicially. The courts have recognised a wide range of factors relevant to the issue of whether or not the successful parties should obtain a costs order. Thus, in Oshlack, the general significance of the case, the desire of an otherwise uninterested person to seek to uphold provisions of the Land and Environment Act, the raising of specific issues in relation to developments and their effect upon endangered species combined to result in an exercise of the discretion against awarding the successful party its costs.

49 In Vucadinovic v Lombardi and anor [1967] VR 81, Pape J was prepared to approach the exercise of discretion as to costs on the basis that the bankruptcy or insolvency of a defendant was a relevant factor to be taken into account primarily because two Judges of the Court of Appeal in Mayer v Harte [1960] 1 WLR 770 seemed to have thought that bankruptcy of a defendant was a relevant consideration. His Honour was by no means persuaded that mere poverty or lack of means short of bankruptcy was a relevant matter to be taken into account. In that particular case Pape J had insufficient evidence to determine whether the defendant was bankrupt or insolvent and the evidence went no higher than the person being unemployed: nevertheless, although rejecting that he was bound to take into account the financial position of the defendant, for the purposes of the case his Honour stated that he was prepared to take into account that the defendant had insurance limited to a certain amount, that he was unemployed and that he had stated that he had no money.

50 This territory was revisited by Einstein J in Schipp v Cameron in an unreported judgment delivered on 12 October 1998. His Honour noted that in Vucadinovic, Pape J, in the exercise of the court's discretion as to costs, regarded as a relevant fact to be taken into account the bankruptcy or insolvency of the unsuccessful defendant although being far from satisfied that it was such a relevant fact in that case. He also noted that in the same judgment when Pape J was considering whether a Bullock order or a Sanderson order should be made, his Honour examined the question of fairness. Similarly, in Milpurrurra v Indofurn Pty Ltd (unreported Federal Court of Australia dated 27 May 1997) Von Doussa J stated: In a case where the substantial wrongdoer is in liquidation or bankruptcy, it is necessary, in the exercise of the discretion to award costs, to have regard to the 'balance of hardship' between the parties involved in the argument over costs. In taking that approach Von Doussa J cited Lord Brandon in Bank America Finance Ltd v Nock (1988) 1 AC at 1012 where "the balance of hardship" was considered. Einstein J also noted that Wilmer LJ in Mayer found it impossible to extract from the authorities any inflexible principle which required in a particular case that the judge must necessarily direct that a successful defendant is to recover its costs from an unsuccessful defendant.

51 In Schipp v Cameron, while Einstein J appeared to have regard to the financial position of the defendant, the history of that financial position was apparently well known when the action was commenced as were the risks if the action failed against another defendant with means.

52 Other considerations have been identified as relevant to the exercise of the discretion regarding costs. In Orellana-Fuentes v Standard Knitting Mills Pty Ltd and anor (2003) 57 NSWLR 282 the Court of Appeal, dealing with a challenge to the validity of regulations prescribing costs recoverable in workers compensation held that at first instance no order had been made as to costs and that as the matters before the court were test cases, in all the circumstances, no costs order would be made. In Health and Research Employees Association of New South Wales v Baptist Community Services NSW and ACT (2002) 122 IR 178, the President, Wright J dealt with an application for declarations as to the coverage of certain employees by a particular award. There was a history of award coverage which included consideration by a Full Bench in its arbitral or industrial jurisdiction. Wright J raised these considerations with the parties in the context of whether an issue of principle or of practice was raised by the proceedings and the appropriateness of the Commission to award costs where those proceedings could be truly said to be intimately related to the industrial and arbitral jurisdiction. The applicant in that case indicated that it did not seek a costs order should it succeed in the proceedings while the respondent accepted that it was open to the Court to take industrial considerations into account in the exercise of the costs discretion. In the Police Association of New South Wales v The Commissioner of Police (2002) 123 IR 301, declarations were sought that a purported suspension of an officer was not a suspension with or without pay under the provisions of the Police Service Regulation 1990 and the further declaration that salary loading formed part of pay for the purposes of any suspension under the Police Service Regulation 1990. At the conclusion of those proceedings the President, Wright J, reserved the question of costs but stated that because of the nature of the proceedings involving, as they did, a dispute between a trade union and an employer of a large number of members concerning the rights of a member of the union, clarification of those rights may be of benefit to the membership generally and it may, in those circumstances, be appropriate for there to be no order as to costs.

53 The nature of the costs power exercised by the Court was also considered in Commissioner for Children and Young People v "A" (No 2) [2004] NSWIRComm 8. The Full Court (Wright J, President; Walton J, Vice-President; Kavanagh J) dealt with an application for costs following contested proceedings concerning the interaction of s 579 of the Crimes Act and the Child Protection (Prohibited Employment) Act and the proposition that a conviction or bond which had stood for a specified period of time without further offence would be disregarded for all purposes. In the course of the costs argument the Court's attention was drawn to the judgments in Oshlack but in particular to the dissenting judgment of McHugh J. The Court accepted that while it may generally be recognised that the mere fact that a government instrumentality is a party to proceedings will not be sufficient to depart from the ordinary rule as to costs, regard had to be had for the nature of the proceedings and the fact that the jurisdiction had been conferred by Parliament on the Commission and also on the ADT where no costs were recoverable. The Court noted that proceedings of this type would generally arise in the industrial jurisdiction of the Commission and that was of considerable significance when approaching the issue of costs and proceedings under s 154, citing the decisions of the President, Wright J in the Health and Research Employees' Association case and the Police Association case. The Full Court then stated at [26]: … the fact that the declaratory orders are sought in relation to issues that would generally fall within the industrial jurisdiction of the Commission, or in relation to issues that could truly be identified as having an intimate connection with the Commission's industrial or arbitral jurisdiction, is a consideration that would generally be relevant to the exercise of the discretion to award costs.

54 The Court also observed that the substantive decision in the matter and on appeal raised important questions as to the operation and interaction of two important pieces of legislation and that any decision on appeal could have considerable ongoing significance for persons engaged in child related employment as identified in s 3 of the Child Protection (Prohibited Employment) Act. Even then, the issue raised in the proceedings was said to be intimately connected with the industrial and arbitral jurisdiction of the Commission and was of general importance to the industrial relationship between the appellant Department and a number of the members of its workforce. It was in those circumstances that the Full Court considered a fair, just and appropriate outcome would involve the parties bearing their own costs at first instance and on appeal.

55 Another example of the way in which the power to award costs might be exercised was recently dealt with by the President, Wright J in June Morgan v The New South Wales Department of Education and Training (IRC 2002/685, unreported, 9 March 2004). That was an application for extension of time to seek leave to appeal and to appeal a decision of the Chief Industrial Magistrate. That application was refused and an order for costs sought by the respondent to the substantive application. The failed appellant argued that she had commenced the proceedings before the Chief Industrial Magistrate in the Small Claims jurisdiction where no costs were available and did not appreciate that costs could be incurred on the appeal. The appellant also had a number of other cases on foot, some of them said to be "formal litigation" as well as administrative appeals and proceedings. It may have been the existence of these other proceedings that moved the respondent Department to seek a costs order in this application and, thereby, put the appellant on notice that in some of the other proceedings she was open to a costs order. The circumstances of the present case were sufficiently special to render it inappropriate to make a costs order. The appellant was certainly now on notice that in other formal litigation she was at risk in relation to the payment of costs if her claims failed.

56 It can be seen from the above brief survey of cases that there may be a number of considerations relevant to the exercise of the discretion to award costs in matters before the Court. In many respects the repetition of standards and approaches in relation to the usual order for costs needs to be considered in the context of the jurisdiction exercised by the Commission and the fact that generally the industrial jurisdiction has operated with the parties bearing their own costs. This fact simply means that there may be considerations which arise as to the appropriateness of a costs order in proceedings before the Commission in Court Session which would not arise in litigation in the general courts, as discussed by McHugh J in his powerful but dissenting judgment in Oshlack.

57 In the substantive proceedings the appellant has sought declarations that at all times since 1987 she had been employed by the New South Wales Department of Public Works and Services and its predecessors; that the decision to refer her for a fitness to continue examination by the Government Medical Officer in 1998 by officers of the Department was void, invalid and no effect; that the purported retirement of the appellant in 1998 by the Government Medical Officer and/or officers of the Department was void, invalid and no effect; and that the appellant was entitled to be paid all emoluments pertaining to her position together with interest thereon and to retain all leave and other entitlements together with interest. The nature of the case brought by the appellant is succinctly set out in the judgment of Marks J (against which the appeal was brought) as follows: 10 The factual background to the substantive proceedings is set out in affidavit evidence which has not yet been formally admitted into evidence in the proceedings but which was referred to by both Mr Crewdson and Mr Benson of counsel who appeared for the respondents for the purpose of these interlocutory proceedings. In general terms the applicant was appointed to the Public Service in 1987. Her appointment was regulated initially by the Public Service Act which was replaced by the Public Service Management Act 1988. Provisions of that Act and a general regulation made under it applied to her employment. As a result of a change of name, the applicant came to be employed by the Department of Public Works and Services in the State Mail Service. The provisions of her employment were regulated by an enterprise agreement and an industrial award. The applicant made complaint in May 1998 to the personnel officer at the State Mail Service about sexual harassment. Because of the way in which the complaint was dealt with she suffered what Mr Crewdson described as "a stress breakdown" and took a short period of sick leave. She also sought flexible leave which was refused without reason and suffered a further stress breakdown necessitating her in taking sick leave. On her return to work the applicant met with the industrial relations manager, the sorting manager, her supervisor and a representative of the Public Service Association of New South Wales and expressed concerns that she was the subject of discrimination and unreasonable denial of flexible leave. She was told that the situation "would change". The applicant alleges that without reference to her a decision was taken by officers of the Department of Public Works and Services to refer her to HealthQuest for an examination. The applicant understood that she was required to attend the examination. A statement was made at the time by a member of the Department that the applicant had taken "excessive sick leave", which statement was some considerable time later retracted. The applicant said that she attended a medical examination with HealthQuest where she was subjected to an intimate physical examination without being informed as to the reasons why and its true nature. She also said that she was required to fill out a questionnaire which, it appears, was later used to provide some form of psychological assessment. Medical practitioners retained by HealthQuest issued a report dated 2 September 1998 entitled "Retirement Certificate" certifying that the applicant suffered from chronic adjustment disorder and other conditions and that they were of the opinion that she was in consequence unable to discharge the duties of her office and that her disability would in all likelihood prove permanent. The Department treated this certificate as authorising the termination of the applicant's employment on medical grounds and on 24 December 1998 an acting director of the Department recommended that the applicant be retired under s 36 of the Public Sector Management Act. This was endorsed by the relevant Minister and the Governor signed a Minute to this effect at a meeting of the Executive Council held on 13 January 1999. 11 The applicant alleges that she was denied natural justice and procedural fairness in and about the manner in which she was treated within her employment and in and about the various steps taken in connection with and leading up to the termination of her employment. The applicant alleges, for example, that the Department was in breach of the relevant industrial instrument which applied to the circumstances of her employment, that the Department had no power to require the applicant to attend a medical examination other than by following the strict procedures contained within s 36 of the Public Sector Management Act (which procedures were not followed) that a psychologist who issued a report concerning the applicant's condition had not examined her, that the applicant should have been given notice of all of the steps being taken by the Department, and given an opportunity to respond and to have some input to the various processes. The respondents made a number of admissions as to factual matters, which prompted the notice of motion seeking summary judgment. However the respondents raised a number of points of contention in opposition to the applicant's claim for declaratory relief. These included the fact that the applicant had an entitlement to a full administrative medical review of the decision to retire her which she declined to exercise, the applicant was entitled to maintain a claim under the unfair dismissal provisions of the Industrial Relations Act 1996 which she chose not to do, the fact that the applicant did not in the proceedings dispute that she was suffering from chronic adjustment disorder with mixed anxiety and depression with marked psychosomatic manifestations, that as a consequence she was unable to discharge the duties of her office and that her disability would in all likelihood prove permanent, all of which may be considered by this Court in determining whether discretion should be exercised under s 154 . The respondents also deny the allegations that the department acted in a way which denied the applicant natural justice or procedural fairness in all the circumstances and denied also the approach to construction of the statutory matrix against which the proceedings were brought. That is, notwithstanding all of the admissions made either formally or informally, the respondents allege that there are factual matters which will require determination for the purpose of ascertaining whether this Court should exercise its discretion under s 154 of the Act and there are distinct questions of law to be considered in any event.

58 It will be seen from this extract that Marks J and apparently the respondent Department accepted the admissions made as alleged by the appellant but the Department wished to call other evidence and rely on discretionary reasons why the relief claimed should not be granted. The application for summary judgment based upon admissions is a technical form of relief often attended by considerable legal difficulties. The application for summary judgment was taken on the appellant's behalf by an agent not qualified in the law who himself is a litigant in other proceedings in the Court. It was apparent during argument on appeal that the appellant's agent regarded it as beyond dispute that once the relevant admissions had been accepted that summary judgment must follow. He was wrong in that assessment but the circumstances do raise issues as to the appropriateness of a costs order on the failed appeal.

59 Because of difficulties with the provision of an appeal book the Court has some knowledge of the limited financial resources of the appellant: there is no evidence or suggestion however that she is bankrupt or insolvent in the technical sense as considered by Pape J in Vucadinovic. As pointed out by Kirby J in Oshlack , consideration needs to be given to the special jurisdiction exercised under the Industrial Relations Act 1996. An object of the Industrial Relations Act 1996 is to provide a framework for the conduct of industrial relations that is fair and just. In this case an ex-employee seeks declarations concerning the circumstances in which she was compulsorily retired from the Department. The issues raised are the powers available to the Department and the circumstances in which it may direct an employee to be medically examined and the validity of a medical examination which is not properly authorised and directed. Without entering into an assessment of the chances of success of the appellant's case, the determination of it will have significance for public sector employees generally. The issues raised are industrial and would normally be taken in the industrial jurisdiction of the Commission. I find these matters to be of significance in considering the exercise of the jurisdiction to order costs.

60 The terms of Rule 211 of the Rules of the Commission have some relevance although perhaps, not directly applicable to the present matter. The width of the Rule need not be determined in these proceedings but it provides a course which I find appropriate in attempting to do justice between the parties on the issue of costs. The Rule provides that the costs of any application or other step in any proceedings, unless the Commission otherwise orders, is to be deemed to be part of the costs of the cause of the party in whose favour the application or other step is determined and shall be paid and otherwise dealt with in accordance with the provisions of Part 27 of the Rules. Having regard to the circumstances of this case I am of the view that an appropriate order would be that the costs of the appeal should be costs in the cause and dealt with at the conclusion of the appellant's substantive application.

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