Visscher v Teekay Shipping

REASONS FOR JUDGMENT 1 This proceeding involves a claim by a former employee of a shipping company for wages and emoluments said to be due to him under the Navigation Act 1912 (Cth). On the motion of the shipping company, the claim was dismissed summarily pursuant to s 31A of the Federal Court Act 1976 (Cth) ("the Act") on the basis that, on the evidence he adduced, there were no reasonable prospects that the defence would not succeed. The defence is available, amongst other circumstances where the delay in payment is due to a reasonable dispute as to liability for the wages. Here, the argument, which the Court accepted, was that there was a reasonable dispute that the shipowner had terminated the employee's employment and therefore as to any liability to pay "wages" payable on termination: Visscher v Teekay Shipping (Australia) Pty Ltd [2011] FCA 1. 2 The applicant sought leave to appeal and the Full Court allowed the appeal: Visscher v Teekay Shipping (Australia) Pty Ltd [2011] FCAFC 137. The Full Court made an order for costs of the appeal but no order with respect to the costs of the notice of motion. On 15 December 2011 I dismissed, by consent, the respondent's motion. 3 On 12 December 2011 Mr Visscher, who at all material times has been unrepresented, filed an interlocutory application pursuant to r 40.02 of the Federal Court Rules 2011 (Cth) ("FCR") that costs of the proceeding to date be awarded to him on an indemnity "lump sum" basis. No evidence was filed as to what costs Mr Visscher incurred. At the directions hearing on 15 December 2011 Mr Visscher informed the Court that he had incurred costs in relation to legal advice he had obtained (although he did not say whether the legal advice related to the interlocutory application, the notice of motion or the principal proceeding). At the directions hearing, the respondent's legal representative submitted that the only costs recoverable would be disbursements. 4 The interlocutory application was supported by an affidavit sworn by Mr Visscher on 12 December 2011. Both parties filed submissions and were content for the application to be dealt with on the papers. 5 Mr Visscher contends, in effect, that the legal representatives of the respondent ("Teekay") concealed from the Court evidence said to be fatal to its notice of motion. That evidence consists of a signed statement from Teekay's director for human resources, David Parmeter, dated 9 August 2004, which was tendered by Teekay in proceedings in the Australian Industrial Relations Commission on 2 March 2006 and which Mr Parmeter swore was true and correct. The statement referred to a conversation with Mr Visscher on or about 26 March 2004 in Teekay's office in which Mr Parmeter said that Mr Visscher had effectively resigned from Teekay by email on 22 February 2004 but that if he changed his mind Teekay would have no objection to him rescinding his resignation and continuing to sail with Teekay. This evidence also appeared in an affidavit sworn by Mr Parmeter in the proceeding in this Court. Mr Visscher argues that what Mr Parmeter said is inconsistent with Teekay's position on the motion for summary dismissal that there was a reasonable dispute about whether or not his employment was terminated on 3 March 2004 and that Teekay's lawyers knew this and deliberately kept this information from the Court on the hearing of the notice of motion. 6 The power to award costs appears in s 43 of the Act. The section confers a broad, general discretion, which must be exercised "judicially, not whimsically or idiosyncratically" and, in the ordinary course the Court will make an order to the effect that costs follow the event: George v Fletcher (Trustee) (No 2) [2010] FCAFC 71 ("George v Fletcher") at [12]. Costs are ordinarily awarded on a party and party basis (FCR r 40.01), defined in the Dictionary to the FCR as "only the costs that have been fairly and reasonably incurred by the party in the conduct of the litigation". In exceptional circumstances the Court will make an order that costs be paid on an indemnity basis. That means that the party against whom the order is made must pay costs "as a complete indemnity" against the costs incurred by the successful party, provided that the costs do not include any amount shown by the party liable to pay costs to have been incurred "unreasonably in the interests of the party incurring them": Dictionary to the FCR. The power to award indemnity costs usually arises where a successful party has made an offer to compromise the litigation. Where the offer is made in accordance with the FCR, r 25.14 confers on an applicant an entitlement to recover costs on an indemnity basis if the respondent did not accept an offer to compromise the litigation and the judgment is more favourable than the amount offered. In other circumstances, the Court's discretion may be invoked. 7 A number of questions arise in the present case. Is Mr Visscher, as a litigant in person, entitled to costs? If so, is there a limit to the costs he can recover? Has Mr Visscher demonstrated an entitlement to indemnity costs? 8 I turn now to consider these questions. 9 "Costs" is not defined in the Act but it is well recognised that the discretion is broad. At common law, costs include the remuneration and disbursements incurred in relation to legal work: Ex parte Farmers Fertilizers Corp Ltd (1916) 16 SR (NSW) 645; 33 WN (NSW) 182. Absent any provision in legislation, a litigant in person is not entitled to recover costs as compensation for loss of time or other disadvantage or inconvenience: Cachia v Hanes (1994) 179 CLR 403. In George v Fletcher the Full Court held that the power to award costs conferred by s 43 of the Act does not extend to awarding a litigant, who is not a legal practitioner, any amount for the time spent in preparing the case or presenting it in court. But, as the Full Court also observed in George v Fletcher (at [17]), there is nothing in Cachia that would preclude a claim for out of pocket expenses like filing fees or the costs of copying the appeal books. In Cachia v The Hills Shire Council [2010] NSWLEC 136 at [30] Preston CJ in the NSW Land and Environment Court held that a litigant in person, who is successful in the proceeding, is entitled to be reimbursed for out-of-pocket expenses incurred in, and for the purposes of, litigating it: 10 Mr Visscher should therefore have the costs of the notice of motion, if any. But the interlocutory application is misconceived. 11 The notice of motion for summary dismissal was based solely on the evidence presented by Mr Visscher, taken at its highest. No statement of Mr Parmeter appeared in Mr Visscher's evidence. Although Mr Visscher tendered parts of affidavits filed by Teekay and upon which Teekay intended to rely if its notice of motion was unsuccessful, Teekay tendered no evidence on the hearing of the notice of motion. There was nothing underhand or improper about this approach. It is true, as Mr Visscher submitted, that the onus of proof of the defence rested with Teekay, but Teekay chose to establish that there were no reasonable prospects of Mr Visscher resisting the defence by relying only on his evidence. It was entitled to do this. The implication in Mr Visscher's submissions that there has been an attempt to pervert the course of justice or an attempt to knowingly mislead the Court because of a failure to tender Mr Parmeter's statement must be rejected. As the majority observed in Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361 at [64], "a litigant has no duty to call particular witnesses or to procure that any witnesses called by that litigant are asked particular questions". There is no reason why Mr Visscher could not have tendered the evidence of Mr Parmeter or the part of Mr Parmeter's affidavit in which it appeared. For these reasons, it is not necessary for the purpose of disposing of this application to consider whether Mr Visscher's submissions about the effect of Mr Parmeter's statement are correct. 12 I would therefore order that Teekay pay the costs of the notice of motion on a party and party basis but the interlocutory application should be dismissed. Mr Visscher should pay Teekay's costs of that application. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Katzmann.