The Contentions of the Parties
6 Kmart seeks an award of costs against Mr Rangi in the sum of $91,676.50.
7 Mr Rangi submitted that his first application for leave to appeal was not instituted "without reasonable cause" for the purposes of s 570(2)(a) of the FW Act. He submitted that it had raised an important and complex question of law concerning whether item 1(c) of s 342(1) of the FW Act should be limited to "positive actions by the employer". The proceedings, he submitted, also raised complex questions of law concerning, amongst other things, the legal source of a "right to seek promotion" and whether the "before and after test" (as referred to by Gyles J. in Unsworth v. Tristar Steering and Suspension Australia Ltd (2008) 216 FCR 122) was to be considered "solely in terms of legal rights and entitlements".
8 Mr Rangi submitted that he took reasonable steps to have his pleadings settled by an employment law specialist barrister and that he had relied on "favourable legal advice". It should not follow, it was said, from the fact that this "advice" has now been found to be "wrong legal advice", that Mr Rangi had acted without reasonable cause. He said he had also been advised that the defects in his pleading were curable, and that his "worst case scenario" was that his pleading would be struck out. This advice was not in evidence before me.
9 Mr Rangi, who is a practising solicitor, submitted that his "real motive" in bringing his proceedings was to seek promotion to the position of manager at Kmart. He apologised for the costs and inconvenience to Kmart. However, if required to pay Kmart $91,676.50, he would be forced into bankruptcy "thereby finishing his career as a solicitor". There was no evidence before me of Mr Rangi's income, assets or liabilities.
10 Finally, Mr Rangi submitted that, even if it is found that he had acted without reasonable cause in bringing his applications for leave, this Court still retained its discretion to refrain from ordering costs in any event. He referred to Australian Workers' Union v. Leighton Contractors Pty Ltd (No 2) (2013) 232 FCR 428.
11 I respectfully do not agree with Mr Rangi's contention that he had instituted his leave proceedings with reasonable cause. I rely upon the decision of Judge Hartnett concerning the issue of costs and to my finding to decline to grant leave to appeal that decision because it lacked sufficient prospects of success. I do not think that Mr Rangi's reliance on unidentified "advice", not tendered in evidence, or his assertion that he would be bankrupted, made without evidence of his financial position, compels any different conclusion. I also do not think that the asserted importance of the legal issues makes any difference. The legal issues lacked any sufficient factual basis.
12 However, I am concerned about the quantum of the costs sought. Kmart submitted:
The Respondent has calculated its costs in relation to the 2 applications for leave to appeal up to and not including the conferral and preparation of these costs submissions on a party/party basis to be $91,676.50. This has been calculated on the basis of "Costs Allowable for Work Done & Services Performed" under Federal Court Rules 2011- Schedule 3 and the 'National Guide to Counsel Fees" effective from 1 July 2013 and in accordance with Part 40 of the Federal Court Rules 2011 and are costs fairly and reasonably incurred by the Respondent.
(Errors in original.)
13 No breakdown of these fees was supplied to the Court. However, I have no reason to suspect that the figures supplied are not accurate or that legal work giving rise to a bill of $91,676.50 had not been undertaken. Nevertheless, in my view the quantum is excessive having regard to the nature of the applications for leave. This matter involved only a few interlocutory steps. It required the filing of written submissions by Kmart which were 19 pages long. The hearing before me took only 1 ½ hours. The issues were not difficult. Mr Rangi represented himself. The costs in the Federal Circuit Court were only $13,192.
14 Pursuant to s 43(2) of the Federal Court of Australia Act 1976 (Cth) the award of costs is in my discretion. For that purpose I can award costs "in a specified sum": s 43(3)(d). See generally Innes v. AAL Aviation Limited (No 2) [2018] FCAFC 130 per Tracey, Bromberg and White JJ.; Kumar v. Secretary, Department of Social Services [2019] FCA 735 per Logan J.; Bechara v. Bates (No 2) [2018] FCA 583 per Perry J. In my view, this is a case where I should exercise my discretion to award Kmart a specified sum by way of costs. In my opinion, having regard to the matters set out above concerning the nature of the applications for leave to appeal, those costs should be set at a quantum which is much less than the amount sought by Kmart. In my view, they should be fixed at $15,000, being a figure similar to that determined by Judge Hartnett. I shall make orders to give effect to that conclusion.
I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Steward.