Procedures and evidence

Contributed by Victorian Equal Opportunity and Human Rights Commission and current to June 2019

In this chapter, the following procedural and evidential issues are discussed:
  • choosing a jurisdiction in which to make a complaint
  • the burden and standard of proof to prove discrimination
  • strike out and dismissal proceedings
  • costs.

Choosing where to make a complaint

Complaints of discrimination, sexual harassment, victimisation and racial and religious vilification can be dealt with in a range of jurisdictions. As at June 2018, these include the Equal Opportunity Act , Racial and Religious Tolerance Act 2001 (Vic), Accident Compensation Act 1985 (Vic), Occupational Health and Safety Act 2004 (Vic), Age Discrimination Act 2004 (Cth), Australian Human Rights Commission Act 1986 (Cth), Disability Discrimination Act 1992 (Cth), Fair Work Act 2009 (Cth), Racial Discrimination Act 1975 (Cth), Sex Discrimination Act 1984 (Cth).

Some jurisdictions require complainants to choose a jurisdiction prior to lodging a complaint. They may be prevented from changing jurisdictions after proceedings have started.

Factors that may be relevant to choosing a jurisdiction include:

  • time limits and timeframes - the statutory timeframes for lodging applications vary between jurisdictions. There are strict timeframes for lodging claims under the Fair Work Act 2009 (Cth) relating to unfair dismissal and general protections where employment has been terminated. By contrast, the Equal Opportunity Act provides the Victorian Equal Opportunity and Human Rights Commission (the Commission) and the Victorian Civil and Administrative Tribunal (VCAT) with discretion to decline a matter more than 12 months old.

  • multiple grounds or attributes - the protection of attributes and areas varies between state and federal jurisdictions. Where an alleged contravention relates to multiple attributes or areas, there may be benefits in using a one-stop-shop statute where all attributes are covered.

  • mixed reasons and motive - some laws provide that the attribute should be the substantial reason for the treatment, such as section 8 of the Equal Opportunity Act. Others require only that the attribute be one of the reasons for the treatment. Similarly, whether motive or awareness of the discrimination is relevant to discrimination varies between jurisdictions.

  • onus or burden of proof - the onus of proving the behaviour was for the alleged reason may vary depending on the Act or part of the Act. Under the Fair Work Act 2009 (Cth), for example, the onus of proving the decision to take particular action was not unlawful rests with the respondent. The onus of proving direct discrimination under the Equal Opportunity Act (and other such Acts), on the other hand, is on the complainant. Under the Equal Opportunity Act the respondent has the onus of showing that the requirement condition or practice is reasonable. See Burden of proof under the Equal Opportunity Act for more information.

  • forum shopping - there are some prohibitions on bringing multiple actions under different laws for the same matter. For example, if a dispute is lodged under the Equal Opportunity Act, it cannot then be brought under federal discrimination laws. And section 116(b) and (d) of the Equal Opportunity Act provide the Commission with the discretion to decline to provide dispute resolution in a matter that has been adequately dealt with by a court or tribunal or where the person has commenced proceedings in another forum. However, the Commission also has the discretion to accept a matter that has been lodged in the federal jurisdiction. See, for example, Bashour v Australia & New Zealand Banking Group Ltd final [2015] VCAT 308.

  • sexual harassment issues - protection from sexual harassment is explicit in some statutes and implied in others. Sexual harassment is specifically prohibited under the Equal Opportunity Act 2010 (Vic), for example, but may be covered by the general protections provision under the Fair Work Act 2009 (Cth). The protections relating to sexual harassment and volunteers also vary between jurisdictions.

  • costs - there are no specific provisions relating to costs in unlawful discrimination proceedings before the Federal Circuit Court and Federal Court. Rather, the Courts have a general discretion to order costs under the provisions of the Federal Court of Australia Act 1976 (Cth) and the Federal Circuit Court of Australia Act 1999 (Cth).(1) At VCAT there is a general presumption that parties each bear their own costs; however, it has the discretion to order costs. See the section on Costs for more discussion

  • definitions - differences in definitions between state and federal laws - for example, 'disability', 'gender identity' and 'employee' - may give rise to a complaint in one jurisdiction but not another.

  • related actions - some allegations give rise to related actions in a particular forum - for example, breach of contract, adverse action because of workplace rights, breach of a National Employment Standard, breach of the Competition and Consumer Protection Act 2010 (Cth).

Proving discrimination

To prove a claim of discrimination, the complainant needs to establish, on the balance of probabilities, that they have been discriminated against on the basis of one or more of the attributes sets out in the Equal Opportunity Act, in one or more of the areas of public life.

Burden of proof under the Equal Opportunity Act

Under the Equal Opportunity Act, the burden (or onus) of proof is on the complainant to prove their claim. See, for example, GLS v PLP [2013] VCAT 221 [34]; Pham v Drakopoulos (Anti- Discrimination) [2012] VCAT 1198 [23]; Finch v The Heat Group Pty Ltd [2010] VCAT 802 [956]. The complainant must provide specific, detailed complaints with sufficient evidence to show the alleged incidents took place and amount to a breach of the Equal Opportunity Act. This includes evidence that an attribute exists as well as the breach of the Equal Opportunity Act. This means a complainant must be able to set out how they have been discriminated against based on an attribute in an area of public life or other unlawful conduct. See AB v Ballarat Christian College [2013] VCAT 1790 [18].

However, where a respondent seeks to rely on an exception under Part 4 or Part 5 of the Equal Opportunity Act, or an exemption granted by VCAT under section 89, the burden of proof is on them. They must provide sufficient evidence to show how the exception or exemption applies to their conduct, as outlined in section 13(2).

Similarly, to rely on the exception to vicarious liability for unlawful conduct of employees under section 110 of the Equal Opportunity Act, employers and principals have the burden of proof. They must show they took reasonable precautions to prevent their employee or agents from breaching the Equal Opportunity Act.

Where a person is alleged to have breached section 107 of the Equal Opportunity Act (requesting or requiring discriminatory information), the burden of proof is on the person who requests or requires the information. Section 108(2) stipulates that they must prove that the information is reasonably required for a purpose that does not involve prohibited discrimination.

For claims of indirect discrimination, under section 9(2) the person who imposes a requirement, condition or practice (or proposes to impose one) has the burden of proof to show that the requirement, condition or practice is reasonable.

Under section 12(6), where a person or organisation wishes to use a special measure to promote equality for members of a group with a particular attribute, they have the burden of proof to show the measure meets the criteria in section 12 of the Equal Opportunity Act.

Standard of proof

A party bearing the burden of proof must meet that burden to the civil standard of proof - the balance of probabilities. See [[http://www.austlii.edu.au/au/cases/cth/HCA/1992/66.html][ Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd [1992] HCA 66; (1992) 67 ALJR 170 [2]]]. Also see Evidence Act 2008 (Vic) s 140. This means VCAT must be satisfied 'overall it is more probable than not that the events occurred as described and that the inferences sought to be drawn can reasonably be drawn from the facts as they have been found'. See Drew v Whitehorse City Council [2010] VCAT 372 [18] relying on Morgan v Austin Health [2007] VCAT 2229 [22] (Harbison J). See also Obudho v Patty Malones Bar Pty Ltd [2015] VCAT 1521.

The degree of satisfaction required for a finding in favour of the complainant is discussed in Briginshaw v Briginshaw [1938] HCA 34 ( Briginshaw v Briginshaw ). The following comments made by Dixon J are usually relied upon by courts and tribunals considering the degree of satisfaction required to discharge the burden of proof:

The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of VCAT. In such matters 'reasonable satisfaction' should not be produced by inexact proofs, indefinite testimony, or indirect inferences (Briginshaw v Briginshaw).

See, for example, Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd [1992] HCA 66 [2], GLS v PLP [2013] VCAT 221 [35]-[36], [44] and Thomas v Alexiou [2008] VCAT 2264 [106]-[107].

This means the seriousness of the allegations must be considered when assessing whether the burden of proof has been discharged by the complainant. See King v Nike Australia Pty Ltd [2007] VCAT 70 [124]. In certain cases where the allegations made have been very serious, VCAT has held 'clear and cogent evidence may be required before there is reasonable satisfaction that the allegations have been made out on the balance of probabilities'. See GLS v PLP [2013] VCAT 221 [39] relying on Clark v Stingel [2007] VSCA 292 [35] and [[http://www.austlii.edu.au/au/cases/cth/HCA/1992/66.html][ Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd [1992] HCA 66; (1992) 67 ALJR 170 [2]]]. This specific consideration may not be necessary in all claims. The Federal Court of Australia has found the Briginshaw principle does not recognise any intermediate standard of proof. It merely provides guidance on how the civil standard of proof is to be approached when serious allegations are made in the course of civil proceedings. See Macedonian Teachers Association of Victoria Inc v Human Rights & Equal Opportunity Commission [1998] FCA 1650; (1998) 91 FCR 8.

Strike out and dismissal proceedings

Section 75 of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act) gives VCAT discretion to dismiss or strike out a proceeding, whether or not all the evidence has been heard. It can do this if, in VCAT's opinion, all or part of the proceeding is frivolous, vexatious, misconceived or lacking in substance, or is otherwise an abuse of process.

The principles to be followed in these proceedings are set out in Norman v Australian Red Cross Society (1998) 14 VAR 243, where Deputy President McKenzie stated:

VCAT should exercise caution before summarily terminating a proceeding. It should only do so if the proceeding is obviously hopeless, obviously unsustainable in fact or in law, or on no reasonable view can justify relief, or is bound to fail. This will include, but is not limited to, a case where a complaint can be said to disclose no reasonable cause of action, or where a Respondent can show a good defence sufficient to warrant the summary termination of the proceeding.

If VCAT is not satisfied these circumstances exist, the matter should go to hearing so the evidence can be heard and tested.

In State Electricity Commission of Victoria v Rabel [1998] 1 VR 102 the Court of Appeal considered the operation of section 44(c) of the Equal Opportunity Act 1984 (Vic). This provision also provided a power of summary dismissal. The Court found a complaint could not be dismissed under section 44(c) unless it was clear beyond doubt the complaint was lacking in substance, and the complainant had no arguable case that should be resolved at a full hearing.

In Forrester v AIMS Corporation [2004] VSC 506 the Supreme Court made clear the onus of establishing a ground for summary termination rests with the party who has made the application.

VCAT has applied these principles in a number of discrimination cases. Some examples are set out in the following paragraphs.

No covered area of public life

VCAT may strike an application out where the complaint does not disclose an area of public life covered by the Equal Opportunity Act (set out in rhe chapter Areas of public life in which discrimination is prohibited) and the claim is manifestly hopeless. In Tarpey v State of Victoria [2009] VCAT 410, for example, a father brought a discrimination claim against the primary school his daughter attended. He claimed the school and the State of Victoria discriminated against him on the basis of sex and physical features in the provision of goods and services. He alleged the respondent failed to communicate with him about his daughter's case and development, in circumstances where the school kept in contact with his daughter's mother. The State of Victoria made an application to dismiss his claim. It stated the claim was misconceived and lacking in substance, as it was not providing any goods or services to him. VCAT found although the complainant possessed the relevant attributes, he could not identify an area of activity in the 1995 Act where the discrimination occurred. VCAT found the school or State of Victoria was not providing goods or services to him and dismissed the claim on the ground that it was misconceived, lacking in substance, and untenable in fact and in law.

However, in some circumstances a school may be found to provide services to a parent. In Murphy v New South Wales Department of Education [2000] HREOCA 14, for example, the Australian Human Rights Commission upheld a complaint of discrimination by the parents of a student. The complaint related to the provision of services and facilities by the school. In particular, the complaint alleged the 'services' provided related to the administration of the public education system and the provision of facilities for the education of their child. This case is also discussed in the section on Discrimination in education.

In Kavanagh v Victorian WorkCover Authority trading as WorkSafe Victoria [2011] VCAT 2009 VCAT considered a claim of discrimination and victimisation by WorkSafe in the handling of a complaint. VCAT found the alleged services (the power to investigate, the power to issue an improvement notice, the power to charge an offence) were not services within the definition in the 1995 Act. This was because they all require the exercise of a discretion that is quasi-judicial in nature. If exercised, none of the services would confer any benefit, advantage or welfare on the complainant. VCAT also found the complaints of victimisation could not succeed because they were not supported by evidence. VCAT dismissed the complaints.

Importantly, federal case law has established a claim should not be dismissed or struck out simply because the pleadings (or particulars) are deficient. A claim should not be dismissed or struck out by not setting out the area of public life when one may well apply, for example. Rather, the prospects and merits of the case underlying the pleadings should be examined, not the pleadings taken on face value as they may be able to be amended to rectify any deficiency. See Fortron Automotive Treatments Pty Ltd v Jones [No 2] [2006] FCA 1401 [19]-[20].

Exceptions that clearly apply

In Garden v Victorian Institute of Forensic Mental Health [2008] VCAT 582 VCAT also found there was no 'service' under the 1995 Act. The complainant was a patient at the Victorian Institute of Forensic Mental Health. He made a claim of discrimination against the Institute on the basis of impairment in the provision of a service. The complaints related to reports from his psychiatrist to the Adult Parole Board and requirements that he open his mail in front of his psychiatrist. The Institute applied to have the complaints struck out on the basis they were frivolous, vexatious, misconceived or lacking in substance. VCAT found the complaints relating to the reports from the psychiatrist to the Adult Parole Board were not a service to the patient. VCAT struck out this part of the complaint as manifestly hopeless. VCAT found the requirement that he open his mail in front of his psychiatrist could amount to discrimination. However, this was authorised by an enactment (the Mental Health Act) and the statutory authority exception under the 1995 Act applied. This part of the complaint was also found to be manifestly hopeless and struck out.

VCAT has confirmed if a respondent relied on an exception under the Act as the basis for striking out a claim, the exception must so completely answer the claim that VCAT is satisfied the complaint is undoubtedly hopeless. See Forrester v AIMS Corporation [2004] VSC 506 and Dulhunty v Guild Insurance Ltd [2011] VCAT 2209.

Time delay

The Equal Opportunity Act does not set a strict time limit for commencing dispute resolution at the Commission or making an application to VCAT.

Where the alleged contravention occurred more than 12 months before the application was made:
  • section 116 provides the Commission with the discretion to decline to provide dispute resolution
  • item 18 of Schedule 1, Part 7 of the VCAT Act gives VCAT discretion to make an order under section 76 summarily dismissing or striking out an application for want of prosecution (inexcusable delay).
Delay in bringing an application may also amount to an abuse of process and, therefore, be a basis for summary dismissal under section 75 of the VCAT Act. In Burrows v State of Victoria [2002] VCAT 1655 Deputy President McKenzie found factors that bear on whether delay does amount to an abuse of process are:
  • whether the delay was inordinate and unreasonable or inexcusable
  • any explanation for the delay and its adequacy
  • the nature of the proceeding
  • whether and to what extent the respondent was responsible for delay
  • prejudice to the respondent if the proceeding were to continue
  • the public interest
  • the effect of the delay on the quality of justice, in particular the ability to conduct a fair hearing [38].
Her Honour stated these factors must be balanced against each other and no single factor is determinative. The primary consideration is the interests of justice.(2) For instance, VCAT decided not to dismiss an application filed almost three years after the events occurred, after tragic family circumstances caused the complainant to lose focus on legal proceedings. See McMahon v Green [2015] VCAT 1156 [50] [53].

In Burrows v State of Victoria [2002] VCAT 1655 VCAT dismissed parts of a complaint on the basis that the delay in relation to the claims would prejudice the hearing of the case. In this case, the complainant brought a number of claims of discrimination against the State of Victoria on the basis of impairment in the area of employment. The complainant alleged he had been denied opportunities for promotion, transfer and training, or that they had been limited. A number of the claims related to events that occurred six to 12 years before the complaint was lodged. The State of Victoria applied to strike out or dismiss the complaints on the ground the delay in lodging the complaint amounted to an abuse of process. VCAT held this length of delay would prejudice the case, because there would be problems gathering evidence given the delay. See also Garcia v Miles [2012] VCAT 262.

Although some delays may not amount to an abuse of process, such as in Kramersh v IPD Education Limited [2014] VCAT 1439, in other cases the lapse of time is fatal to a claim. In Stewart v City of Yarra [2016] VCAT 1537 VCAT dismissed proceedings relating to events that occurred up to 15 years previously [47], [51], [56]. VCAT found the delay was inordinate and inexcusable. VCAT considered the respondents would suffer prejudice given the quality of evidence deteriorates with the absence of many critical witnesses, destruction or loss of documents and fading memories. Ultimately, the facts of the particular allegations and circumstances will be relevant to VCAT's determination. See for instance, Bligh v State of Queensland HREOCA [1996] 28, where a delay of more than 10 years did not invalidate a complaint.

Claim being heard in another forum

In Moloney v Victoria [2000] VCAT 1089 claims of discrimination on the basis of impairment in employment were made against the State of Victoria. One of the claims raised an issue that was also being considered at the time by the Australian Human Rights Commission under the Disability Discrimination Act 1992 (Cth). The respondent sought to strike out this part of the claim as frivolous, vexatious, misconceived or lacking in substance, or an abuse of process. VCAT found it would be an abuse of process to determine the matter while the complaint was still being considered by the Australian Human Rights Commission. VCAT struck out this part of the complaint. See also Bashour v Australia & New Zealand Banking Group Ltd final [2015] VCAT 308 discussed in the section Choosing a where to make a complaint.

An abuse of process may also be established where a complainant has brought repeated applications or is seeking to again raise issues that have already been determined by VCAT or another body. See Fernandez v Insulation Solutions Pty Ltd [2004] VCAT 125 and Cartledge v Skyway Executive Pty Ltd [2004] VCAT 2017.

No prospect of success

In Carnegie v Victorian Registration and Qualifications Authority [2012] VCAT 1952 the Victorian Registration and Qualifications Authority had cancelled the registration of the Carnegie School because it failed to comply with the minimum standards set out in the Education and Training Reform Regulations 2007. Dr Carnegie argued his school catered for emotionally and socially traumatised students. He claimed discrimination in the area of education, based on the attribute of his personal association with others who had a disability. The respondent applied for the matter to be struck out or dismissed because the claim could not possibly succeed. VCAT found the authority is not an educational authority as they are not responsible for making decisions about individual students. It found the minimum standards imposed are those set out in the Regulations, which were determined by Parliament and imposed on all schools. VCAT found there was no prospect of success in this case and dismissed the complaint.

In Naidu v Causeway Inn Pty Ltd [2015] VCAT 929 VCAT stated it:

[I]s required to exercise caution before summarily terminating a proceeding. It should only do so if the proceeding is obviously hopeless or unsustainable in fact or in law, or on no reasonable view can justify relief, or is bound to fail. This will include, but is not limited to, a case where an application can be said to disclose no reasonable cause of action or where a respondent can show a good defence sufficient to warrant the summary termination of the proceeding.

Application of immunity provisions

Judicial immunity from civil liability only applies to persons exercising judicial, rather than administrative, functions in a court or tribunal. See X v State of South Australia [No 3] [2007] SASC 125 [148]-[159], Sirros v Moore [1975] QB 118 [132] and Mann v O'Neill [1997] HCA 28; (1997) 191 CLR 204 [212]. This means both the individual and State of Victoria can be sued in relation to administrative functions. Note, however, that in Towie v State of Victoria [2002] VCAT 1395 the complainant made allegations the treatment he received during the conduct of a hearing at VCAT was discriminatory. VCAT found it would be a fundamental breach of the rules of natural justice for VCAT to be both a named party and a decision-maker in the matter. It found the matter must be struck out under section 77 of the VCAT Act (because the subject matter of the proceeding would be more appropriately dealt with by another court or tribunal). VCAT also found VCAT members have the same protection as a judge in the performance of his or her duties and that it was inappropriate to name VCAT as a party, as it is not a body capable of being sued.

Beyond the territorial reach of the Equal Opportunity Act

In Gluyas v Google Inc [2010] VCAT 540 the complainant alleged a blog established by a third person (in the United States) containing offensive material amounted to discrimination against him in the provision of goods and services. Google sought to have the matter dismissed because the conduct occurred entirely outside the State of Victoria. For that reason, Google argued the conduct was not governed by the provisions of the 1995 Act. VCAT found the conduct in question was Google's assistance in putting the material up and its refusal to take that material down. It found the conduct had occurred outside the jurisdiction. VCAT distinguished this from cases involving those who actively publish the material on the internet. VCAT dismissed the complaint as lacking jurisdiction.

In Tan v McArdle [2010] VCAT 248 VCAT considered a claim about an employment decision made in Tasmania while the complainant was living and working in New South Wales. The complainant alleged victimisation because of a sexual harassment complaint that had been previously made in Victoria. VCAT found none of the elements of victimisation occurred in Victoria, and thus there was an insufficient connection to Victoria. VCAT dismissed the complaint.

Vexatious claims

Courts and tribunals have provided some guidance on when an application will be considered vexatious:

If it is brought predominantly for a purpose other than obtaining an adjudication of rights under the Equal Opportunity Act, or primarily to annoy, embarrass or place an unfair burden on the respondent, or if it is so untenable as to be manifestly hopeless.

See Al-Hakim v Arthur Robinson & Hedderwicks [2001] VCAT 1767, citing Cabot v City of Keilor [1994] 1 VR 220 and Attorney-General v Wentworth (1998) 14 NSWLR 481.

Costs

When a complaint of unlawful conduct is made under the Equal Opportunity Act, the parties involved may engage a lawyer or advocate to assist them. Unless the lawyer or advocate is acting on a pro bono (free) basis, each party will accumulate costs.

The term 'costs' describes legal fees incurred in making a complaint and taking it to a court or tribunal. 'Costs' can also include other expenses, charges or 'disbursements' that the party's lawyer incurs in preparing, presenting or defending a case They can include application fees, barristers' fees, photocopying, expert witness fees or other costs involved in calling witnesses. When costs are awarded against a party, they must pay the costs of the other party or parties in accordance with the order of the court or tribunal.

Costs are different to damages or financial compensation for loss caused as a result of unlawful conduct. See the section on Damages for more discussion.

Recovering costs

At conciliation at the Commission under the Equal Opportunity Act, a complainant can seek costs as part of their negotiated settlement, if they are able to agree this with the other party. There are no rules in the Equal Opportunity Act to restrict a complainant seeking to recover their costs during dispute resolution facilitated by the Commission.

When a complaint is heard before VCAT, the general rule is that each party will bear their own costs in the proceeding. This rule is set out in section 109(1) of the VCAT Act.

However, VCAT has a discretion under section 109(2) of the VCAT Act to order that a party pay all or a specified part of the other party's costs at any time in the proceeding. It can do so only if satisfied it is fair to do so, having regard to a list of factors set out in section 109(3) of the VCAT Act. These factors are discussed in more detail below.

If VCAT orders costs, usually the successful party has their costs paid by the unsuccessful party. However, because VCAT has a discretion in ordering costs, a successful party may have to pay some or all of the costs of the unsuccessful party if VCAT considers it fair to do so.

Awarding costs

At discussed above, VCAT has discretion to order one party to pay another party's costs. Generally speaking, if VCAT awards costs against a party, it will be on the application of the other party, and in relation to poor conduct during proceedings. Such conduct includes causing delay, lying or leading the other party or VCAT, or bringing a claim with no basis in law or fact.

As VCAT noted in Tan v Xenos [2008] VCAT 1273:

Most costs orders appear to have been made against unsuccessful Complainants whose cause of action has been hopeless from the start. Costs orders against Respondents have usually been made where the Respondent has not complied with interlocutory orders, or to take into account the manner in which the Respondent has conducted the defence, or the maintaining of any clearly hopeless defence [7].

In determining whether to award costs, VCAT may consider a number of factors under section 109(3) of the VCAT Act:

a) whether a party has conducted the proceeding in a way that unnecessarily disadvantaged the other party, including:

(i) failing to comply with VCAT's directions or orders without reasonable excuse
 
(ii) failing to comply with the VCAT Act or rules
 
(iii) asking for an adjournment as a result of failing to comply with directions or rules
 
(iv) causing an adjournment
 
(v) attempting to deceive another party or VCAT
 
(vi) vexatiously conducting the proceeding.

b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding

c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law

d) the nature and complexity of the proceeding
 
e) any other matter VCAT considers relevant.

VCAT can consider these factors together and determine whether it is fair to make an order for costs. See Richardson v Casey City Council [2015] VCAT 235 [28].

Differences in resources will not necessarily be a reason to order costs. In the matter of Ingram v QBE Insurance Ltd [2015] VCAT 1936 [302] the complainant was successful in her claim. She was represented by Victoria Legal Aid. VCAT did not consider the fact that the majority of the legal costs would be paid from the public purse was a reason to order costs.

VCAT may also order costs under:

  • section 74(2)(b) of the VCAT Act where a party withdraws their application
  • section 75(2) of the VCAT Act where VCAT makes an order summarily dismissing or striking out all or part of a proceeding that it considers is frivolous, vexatious, misconceived, lacking in substance or an abuse of proceedings.

In the costs decision Styles v Murray Meats Pty Ltd [2005] VCAT 2142(Styles)Deputy President McKenzie provided some guidance on how section 109 will be interpreted and applied by VCAT:

As the Victoria Court of Appeal pointed out in Pacific Indemnity Underwriting v Maclaw [2005] VSCA 165, the position under section 109 of the VCAT Act is different from that applying in the courts. The general rule is that costs lie where they fall unless VCAT considers it fair to award otherwise. Whether it is fair to award otherwise must be determined on a case by case basis. Some of the factors taken into account may be of a more general nature. Other factors will relate only to the case in question. It is difficult to argue by reference to analogy in other cases. Each case must be considered on its merits and will be different from each other case.
 
I accept that it is important that the redress provided by the Equal Opportunity Act should not be undermined or made less accessible because potential complainants fear orders for costs against them if they lose. This is a good reason for not applying an automatic rule that costs follow the event. Section 109 does not do this. It requires each case to be considered on its own circumstances [15]-[16].

Deputy President McKenzie further noted a party will not be entitled to costs in every case, simply because they have legal representation or the matter has been 'vigorously contested'. The latter may be a 'decisive factor' in one case, but not in every case. The question will be whether in a particular case it is fair to award costs [17]-[19].

In Styles, the complaint was of sexual harassment and sex discrimination. Only the sexual harassment complaint was successful. In assessing the complainant's costs application, Deputy President McKenzie considered the relative strengths of the parties cases. She found the complainant's sexual harassment case was strong, whereas the respondent's sex discrimination complaint was also strong. Taking this into account, and the fact the complaint was strongly contested, Deputy President McKenzie considered it fair to award 50 per cent costs in favour of the complainant [21]-[24].

Setting the amount of costs

In conciliation the amount of costs a complainant might recover will depend on negotiations between the parties. Any amount negotiated should be based on what the party has been charged by their lawyer or advocate.

If VCAT makes an order for costs, it may set the amount of costs itself, such as by reference to an existing court costs scale(3) or by simply setting an amount payable.(4) Alternatively, VCAT can order that the Costs Court assess, settle, tax or review the costs of the proceedings (section 111 of the VCAT Act). Taxation of costs may be ordered in the first instance, or can be ordered in default of agreement.

The Costs Court is a specialist court established by section 17C of the Supreme Court Act 1986 (Vic). If VCAT orders an assessment or taxation of costs by the Costs Court, this will involve filing a detailed bill of costs for the Costs Court to assess whether the costs were reasonably incurred and have been billed at a reasonable rate. The rules contained in Order 63 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) govern this process.

If the matter goes to the Costs Court for assessment, under regulation 63.28 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) costs can be 'taxed' and awarded on two bases:

  • 'standard basis', which are all costs reasonably incurred and of reasonable amount (regulation 63.30)
  • 'Indemnity basis', which are all costs, except those that were unreasonably incurred or are of an unreasonable amount (regulation 63.30.1).

Costs are usually awarded and assessed on a standard basis, whether taxed by the Costs Court or ordered by VCAT.

Parties should retain their tax invoices and receipts so there is an accurate record of costs.

Rejecting an offer of settlement

The VCAT Act provides that a party who makes an offer of settlement will be entitled to have their costs reimbursed where the offer is rejected (under sections 112-115 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic)). However, these sections do not apply to complaints under the Equal Opportunity Act (under schedule 1, clause 22 of the VCAT Act).

Instead, in exercising its discretion to order costs under section 109(3) of the VCAT Act, VCAT may take into consideration the fact a party has rejected an offer of settlement or compromise (including a 'Calderbank letter' where the offer is said to be 'without prejudice save as to costs'). This is usually relevant where the party rejecting the offer is the unsuccessful party in the proceedings. See, for example, Morros v Chubb Security Personnel Australia [2009] VCAT 1845 [21]-[25].

Rejecting an offer of settlement may, therefore, be relevant to whether costs are awarded. However, VCAT has noted rejecting an offer will not automatically result in an award of costs against an unsuccessful party. See Morros v Chubb Security Personnel Australia [2009] VCAT 1845 [21] and Coomans-Harry v Direct Mobile Conveyancing Pty Ltd [2012] VCAT 143 [26].

Costs awarded by VCAT

Examples of costs awards by VCAT between 2006 and 2018 are set out in Table 2 below. It details the type and amount of costs ordered and the reasons they were ordered. It is not an exhaustive list and does not include cases where costs were sought and refused.

Table 2: Examples of costs awarded by VCAT 2006-2018

Name

Grounds for seeking costs

Outcome and basis for orders

GLS v PLP [2013] VCAT 1367

The complainant sought costs based on section 109 of the VCAT Act based on:
  • her success in the proceeding regarding her allegations of sexual harassment
  • the length of the proceeding
  • the manner in which the respondent conducted the proceeding, including the pursuit of an unmeritorious and time-wasting interlocutory appeal to the Supreme Court of Victoria, and service of new and significant affidavit material on the first day of the final hearing
  • the remedial nature of the legislation and the disincentive to complainants to bring similar proceedings if they are not to be compensated for reasonable legal costs
  • the fact that the complainant's legal expenses exceeded the damages recovered, even though the compensation awarded was $100,000.

Orders
Respondent to pay:
  • the costs of various hearings and in-chamber orders during the proceeding
  • the complainant's costs thrown away due to late filing and service of a witness statement and exhibits
  • the complainant's solicitor and counsel for appearances at hearing.
Costs were taxed by the Costs Court under the County Court Scale of Costs. This order did not cover costs of hearing days.

Reasons
In seeking costs orders, counsel for the complainant principally relied on section 109(3)(a)-(d).

The orders address the respondent's conduct where it unnecessarily disadvantaged the complainant, including failing to comply with VCAT's orders and directions, seeking an adjournment, or vexatiously conducting the proceeding and unreasonably prolonging its interlocutory and final stages.

However, there was no reason to depart from the prima facie rule set that each party should bear their own costs of the proceeding, given that both parties were represented. Although fourteen allegations of sexual harassment were raised the allegations were not complex and the case required consideration of facts and expert evidence.

When contemplating the considerations set out in s 109(3)(a)-(e) individually and collectively, VCAT was not satisfied it was fair to make a general costs order or additional costs orders.

Richardson v Casey City Council [2015] VCAT 235

The respondent sought compensation for costs and expenses unnecessarily incurred taking into consideration the matters set out in section 109(3)(a)-(e) on the basis that the complainant:
  • failed to comply with VCAT's orders
  • filed evidence that was largely irrelevant and unreasonably prolonged the time taken to complete the proceeding
  • pursued claims that had no tenable basis in fact or law
  • unnecessarily disadvantaged the respondent and caused it to incur costs it would not otherwise have incurred.

Orders
VCAT required the complainant to pay the respondent's costs for one hearing day and standard costs associated with defending one of the discrimination claims. VCAT otherwise dismissed the application for costs.

Reasons
It was fair and appropriate to address the unnecessary disadvantage caused to the respondent by grossly unreasonable conduct. This included unreasonably prolonging the time taken to complete the hearing.

However, VCAT also observed as a self-represented litigant, the complainant was seeking to prove conceptually difficult Equal Opportunity Act claims. Discrimination law is a difficult area and even represented parties can have trouble properly enunciating and then proving claims. Not all the complainant's failures to comply with directions or properly organise his material were intentional or due to a lack of effort.

Testart v Phoenix Institute of Australia [2015] VCAT 309

A respondent applied for costs against a complainant on the basis it considered the complainant brought proceedings before it had made a final decision about the complainant's request for reasonable adjustments to accommodate her disability.

Orders
VCAT ordered the complainant to pay indemnity costs of the proceeding against various individual respondents. It did not order costs to cover the defence presented by the first respondent (a provider of education).

Reasons
VCAT disagreed the initiation of the application demonstrated the proceeding was conducted vexatiously.

VCAT was not persuaded the circumstances were sufficient to justify an award of costs regarding the first respondent, an education provider. If an order for costs made where there was a significant factual dispute that needed to be resolved by VCAT would constitute an unacceptable bar to access to this remedial jurisdiction. However, the joining of the individual respondents to the claim was completely unnecessary, unreasonable and an abuse of VCAT's processes.

A'Vard v Deakin University [2015] VCAT 1245

The respondent applied for an order for all costs it had incurred in the proceeding. It relied in part on the fact VCAT had made a costs order against the complainant in an earlier proceeding.

Orders
VCAT required the complainant to pay the respondent's costs from the time VCAT had been presented with all relevant evidence until the matter was struck out, under the County Court costs scale.

Reasons
VCAT concluded the circumstances of this case warranted the making of a costs order because:
  • the complainant had previously brought unmeritorious proceedings against the same respondent and was repeatedly warned of the risks of pursuing the matter
  • the previous case should have made the complainant well aware that costs orders could be made to compensate a respondent if she was unsuccessful
VCAT had strongly recommended the complainant seek legal advice on the strength of her claim.

FFF v ZJR [2014] VCAT 741

A respondent sought costs under section 109(1) of the VCAT Act after a complaint of sexual harassment was struck out.

Orders
The complainant was ordered to pay the second respondent $2000.

Reasons
VCAT found the criteria set out in sections 109(2) and 109(3) of the VCAT Act justified a costs order. It observed:
  • costs are not lightly awarded in the Human Rights Division. VCAT is mindful that members of the public should not be dissuaded from commencing actions for fear that if they are unsuccessful, costs will follow the event
  • nonetheless, the case was manifestly hopeless from the outset. Despite the complainant's solicitors being informed the complainant lacked standing and the Equal Opportunity Act did not cover the circumstances set out in her complaint, the complainant continued the matter. This course of conduct put the respondents to considerable expense in circumstances where the difficulties of the case should have been obvious.

Singh v RMIT University and Ors [2011] VCAT1890

The respondents sought orders for costs under section 109(3)b) and c) of the VCAT Act on the basis that:
  • the complainant was responsible for unreasonably prolonging the proceeding
  • the claim had no tenable basis in fact or law.
The respondents relied on the conduct including the production of significant new material during the hearing and the complainant's manner during cross examination, which was evasive and non-responsive.

Orders
Complainant ordered to pay the respondent's party-party costs on County Court Scale D for five full days of hearing.

Reasons
The specified circumstances set out in section 109(3)b) and c) had been made out and, in all the circumstances, VCAT considered it fair that an order for costs be made.

While the complainant did not intend to deliberately prolong the hearing, the manner in which she conducted herself (particularly during cross examination and despite warnings about her conduct) resulted in the hearing being delayed. The hearing took nine days.

The very serious complaints against the respondent were found to be baseless.

Finch v The Heat Group Pty Ltd (Unreported,VCAT, Harbison VP, 31 January (2011)

Not available

Orders
Complainant ordered to pay two-thirds of the respondent's costs, taxed at County Court Scale D. These costs were not to include professional costs otherwise the subject of an order of costs previously made in this proceeding' (As reproduced in later proceedings Finch v The Heat Group Pty Ltd [2012] VCAT 223 [5]).

Reasons
Costs were awarded on the basis that the conduct of the complainant, and her insistence on exploring irrelevant matters, extended the length of the trial and complicated the pre-trial process.

The complainant's conduct significantly prolonged the hearing of the proceeding over 20 days when it should have run for five days.

Time was lost because of the complainant's conduct, including failure to comply with VCAT orders.

Morros v Chubb Security Personnel Australia [2009] VCAT 1845

The successful respondent sought costs on the basis that:
  • the claim had no tenable basis in fact or law
  • the claim was not one in which the complainant could reasonably have believed she would succeed
  • the complainant unreasonably rejected offers to settle the complaint.

Orders
Complainant ordered to pay respondent $8000 as a contribution towards its costs

Reasons
The complainant rejected several offers of settlement and failed to identify an attribute on which her complaint was based. The case was strongly contested.

Note that this complaint and costs application was heard at the same time as Sagris v Chubb Security Australia Ltd [2009] VCAT 1786 (25 August 2009). While Ms Morros had costs awarded against her, VCAT did not consider it fair in the circumstances to award costs against Mr Sagris because he had an arguable case. Ms Morros' case was 'doomed from the start'.

Tan v Xenos [2008] VCAT1273

The complainant sought costs on the basis of sections 109(3)(b)-(e), which include:
  • the nature and complexity of proceedings
  • that the respondent unreasonably prolonged proceedings
  • whether a party has made a claim that has no basis in fact or law
  • any other relevant matters.
Solicitor-client costs were sought rather than party-party costs.

Orders
Respondent ordered to pay one third of the complainant's party-party costs taxed on County Court Scale D.

Reasons
Costs were awarded against the respondent on the basis that the respondent had introduced irrelevant evidence that unnecessarily lengthened the hearing.

Approximately one-third of the proceedings were affected by this conduct.

In making the orders, her Honour Judge Harbison, Vice President noted each application must be judged 'on its merits and in the light of the raison d'etre of VCAT, which is to promote affordable and timely access to justice' [10].

Judge Harbison noted the proceeding was 15 days long, and was strongly contested with neither side willing to make any concessions to the other [15], citing Bryce v City Hall Albury Wodonga Pty Ltd [2004] VCAT 2013. However, her Honour noted a long complex commercial dispute is very different to a long complex anti-discrimination dispute and further considerations apply.

Solicitor-client costs were rejected in favour of party-party costs, on the basis that 'gross behaviour' during the case was required to justify an award of solicitor-client costs [41].

Mangan v Melbourne Cricket Club (costs) VCAT [2006] 792

The complainant sought indemnity costs, claiming there was 'an element of public interest in the proceeding, the absence of personal gain for the complainant, a disparity in the relative means of the two parties, and the respondent's conduct of the proceeding'.

Orders
Respondent ordered to pay the costs of the complainant, to be assessed by the Principal Registrar on County Court Scale A.

Reasons
The matter was serious, but at the lower order of things. It was fair in all the circumstances to award a 'modest' amount of costs.

VCAT was not satisfied the respondent conducted the proceeding in a manner thatwas in any way improper or unnecessarily imposed costs on the complainant. Nor was VCAT satisfied the disparity in the means of the parties was a relevant consideration.

There was no basis for any order for indemnity costs, and VCAT noted indemnity costs are rare. VCAT did not accept the complaint was 'wholly public spirited' as part of the relief sought provided a personal benefit to the complainant.

Beasley v Department of Education and Training [2006] VCAT 2044

The complainant sought costs in relation to a strike out application by the respondent, and the substantive hearing. For each, the complainant relied on section 109(3)(c)-(e). The arguments focussed primarily on section 109(3)(c) - strengths of the respective cases.

Orders
Respondent was ordered to pay 80 per cent of the complainant's total costs of and incidental to the respondent's application to strike out or dismiss the complaint. Costs payable on a party-party basis on County Court Scale A.

Respondent was also ordered to pay seven per cent of the complainant's costs of and incidental to the rest of the substantive proceeding. Costs include disbursements to the advocate for interpreting services. Those costs were on a party-party basis on County Court Scale C.

Reasons
The respondent was 'unsuccessful as to 80 per cent' of the strike out application, and its arguments in seeking to strike out the complaint were very weak.

In relation to the substantive proceedings, the parties should bear their own costs except in relation to a small part of the complainant's claim, which Deputy President McKenzie considered equalled seven per cent of the total claim. In that case, the case was extremely weak, and the complaint extremely strong, and so the respondent should pay a proportion of the costs. Otherwise, there was no improper, unreasonable, vexatious or oppressive conduct by the respondent.

Kelly v Catholic Education Office [2006] VCAT

2367

The respondents, in the course of a strike out application, sought costs against the complainant under section 109(3)(b)-(d):
  • the complainant was responsible for unreasonably prolonging the time taken to complete the hearing
  • the claim had no tenable basis in fact or law
  • the nature and complexity of the proceeding warranted costs to be ordered.

Orders

Complainant ordered to pay the costs of the respondent on County Court Scale D.

Reasons

VCAT rejected claim under section 109(3)(b) because, while the complainant spent considerable time addressing VCAT, the hearing still finished within the dates scheduled. However, the claim did not have a tenable basis in fact or law. Given the need for the respondent to thoroughly defend the allegations, and the nature and complexity of the proceedings, costs were ordered.

MacDougall v Kimberly Clark [2006] VCAT

2604

The respondents sought orders for costs under section 109(3)(c) and (e) of the VCAT Act on the basis that:
  • complaint had no tenable basis in fact or law despite the complainant having legal representation who could give her advice as to merits of her complaint
  • complainant failed to provide sufficient evidence to support case
  • respondent required to raise evidence on particular issues even though the onus was on the complainant to prove those matters
  • the complainant's cross examination of the respondent's expert witness was irrelevant.

Orders

Complainant ordered to pay respondent's costs:
  • $14,162 for disbursements
  • $5000 towards the respondent's solicitor-client costs regarding the substantive hearing
Reasons
VCAT agreed with the reasons for ordering costs put forward by the respondents. VCAT noted the complainant was legally represented and had been on notice of the deficiencies in her case by the member hearing the application, but had taken no steps to address them.

Khalil v Wallace [2006] VCAT

10

The complainants sought costs on the basis that the respondents had conducted the proceeding in a way that unnecessarily disadvantaged them, by:
  • failing to comply with a direction or order of VCAT without reasonable excuse
  • failing to comply with the Victorian Civil and Administrative Tribunal Rules
  • causing an adjournment
  • prolonging unreasonably the time taken to complete the proceeding.

Orders
Respondents ordered to pay the complainants' costs, fixed at $3,334.58

Reasons
In VCAT's view it was fair to order costs as the respondents failed to comply with orders to file or serve particulars of defence and did not advise VCAT of changes to addresses for service, as required by the VCAT Rules. As a result of their conduct, the hearing was adjourned but the respondents continued to disobey VCAT's directions. This 'unnecessarily disadvantaged the complainants and has prolonged unreasonably the time taken to complete this case'.

Note: this was a complaint under the RRTA.

Protective costs orders

In a protective costs order, a court orders any costs awarded in a proceeding be capped at a given level. In King v Jetstar Airways Pty Ltd [2012] FCA 413, for example, the Federal Court capped the costs to be awarded against the appellant in the appeal proceedings at $10,000, noting 'the point of this cost-capping order is to avoid the stifling of what is potentially an important appeal' [21].

The issue has been considered by the Victorian Supreme Court of Appeal in the matters of Bare v Small [2013] VSC 204 (Bare) and Khalid v Secretary Department of Transport, Planning and Local Infrastructure [2014] VSCA 115 (Khalid). In these decisions, the following factors were considered relevant to whether a protective costs order should be made:

  • the timing of the application
  • the complexity of the factual or legal issues raised
  • whether the applicant claimed damages or other form of financial compensation
  • whether the applicant's claims were arguable and not frivolous or vexatious
  • the undesirability of forcing the applicant to abandon the proceedings
  • whether there was a public interest element to the case
  • the costs likely to be incurred by the parties
  • whether the party opposing the making of the order had been uncooperative and/or delayed the proceeding
  • the applicant's ability to pay costs
  • whether a significant number of members of the public may be affected
  • whether the basis of the challenge raises 'significant issues' as to the interpretation and application of statutory provisions
  • any other matters that could go towards establishing that there should be a departure from the usual rule that the costs follow the event.

In Bare, the Court of Appeal granted a protective costs order. The appellant's liability to pay costs was limited to a maximum of $5000 in the event that an appeal he had brought was unsuccessful. The application was made at the first opportunity. It would allow a claimant of limited means access to the court to advance a case without fear of an order for substantial costs being made against them. The matter raised complex legal questions of clear public importance, and the appellant was not seeking damages. The Court accepted evidence that if the application failed, the appellant would discontinue his appeal. He was 21 years of age, unemployed and with very limited finances. An adverse costs order would cause him to become bankrupt. Considering the financial resources of the parties, and likely costs to be involved, the Court considered it was fair and just to make the order.

However in Khalid, the Court declined to make a protective costs order. The appellant submitted he could not satisfy an adverse costs order and was likely to discontinue his appeal as he was impecunious. He had an arguable case involving public interest considerations, had reasonably pursued the matter and was represented pro bono. Although he sought damages, the amount was very small and he would consent to the order being mutual. The Court considered the fact that the appellant sought damages, a matter found in other cases to 'suggest strongly against a grant of a protective costs order'. Furthermore, the appellant had no personal interest in the outcome and there was no evidence presented about the number of people that would be affected by a determination. The case did not contain elements of public interest of the magnitude of those raised in Bare.

In Victoria, section 65C(2A) of the Civil Procedure Act 2010 sets out the matters that a court may have regard to when considering whether to make a protective costs order. This section now mirrors the common law criteria for protective costs orders and places it into legislation and provides clarity and guidance on the circumstances in which such orders will be considered appropriate.(5)

Notes

1 : Some of the factors identified in federal discrimination cases as being relevant to the discretion to order costs include where there is a public interest element to the complaint; where the complainant is unrepresented and not in a position to assess the risk of litigation; that the successful party should not lose the benefit of their victory because of the burden of their own legal costs; that litigants should not be discouraged from bringing meritorious claims and courts should be slow to award costs at an early stage; and that unmeritorious claims and conduct that unnecessarily prolongs proceedings should be discouraged.

2 : Burrows v State of Victoria [2002] VCAT 1655; Garcia v Miles [2012] VCAT 262 [16]. These decisions are consistent with the approach taken to abuse of process because of delay in other settings: See, for example, Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27.

3 : Previous cases have used either Scale B, C or D of the County Court Costs Scale. See, for example, Scale B: Styles v Murray Meats Pty Ltd [2005] VCAT 2142; Scale C: Gonsalves v MAS National Apprenticeship Services Costs [2007] VCAT 64; Scale D: Finch v The Heat Group Pty Ltd (Unreported, Victorian Civil and Administrative Tribunal, Harbison VP, 31 January 2011) noted in costs appeal decisions: Finch v The Heat Group [2011] VSCA 100, [1], [10]-[12] and Finch v The Heat Group Pty Ltd [2012] VCAT 223 [5].

4 : See, for example, Morros v Chubb Security Personnel Australia [2009] VCAT 1845 where the complainant was ordered to pay a contribution of $8,000 towards the costs of Chubb Security.

5 : Explanatory Memorandum, Justice Legislation Amendment (Access to Justice) Bill 2018 (Vic) 921.


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