Chen v State of Queensland (Queensland Health) (No 2) [2023] ICQ 21

INDUSTRIAL COURT OF QUEENSLAND CITATION: PARTIES: CASE NO: PROCEEDING: DELIVERED ON: HEARING DATE: MEMBER: HEARD AT: Chen v State of Queensland (Queensland Health) (No 2) [2023] ICQ 21 Chen, Victor Appellant v State of Queensland (Queensland Health) Respondent C/2021/26 Application for costs 29 September 2023 20 April 2023 O'Connor VP Brisbane ORDERS: 1. The Appellant's application for costs is dismissed. 2. The Appellant pay the Respondent's costs of defending the application for costs together with the costs of the Respondent's application for costs on an indemnity basis. CATCHWORDS: INDUSTRIAL LAW - QUEENSLAND - APPEAL TO INDUSTRIAL COURT - APPLICATION FOR COSTS - where public service appeals, general protections and dismissal applications filed in the Queensland Industrial Relations Commission (the Commission) - where appeal allowed and decision in public service appeals set aside - where public service appeal adjourned to -- 1 of 14 -- 2 Industrial Registry pending the hearing and determination of applications for general protections and dismissal - where appellant filed application for indemnity costs - where respondent seeking indemnity costs - whether application made or responded to vexatiously - whether application made without reasonable cause - whether application had reasonable prospect of success - whether indemnity costs should be ordered LEGISLATION: CASES: Industrial Relations Act 2016 (Qld), s 545 Industrial Relations Act 1999, s 335 Baker v Salver Resources Pty Ltd [2012] FWAFB 4014 Blackwood v Egan [2014] ICQ 020 Chen v Gold Coast Health and Hospital Service [2021] QIRC 235 Chen v State of Queensland (Queensland Health) [2021] QIRC 369 Chen v State of Queensland (Queensland Health) [2022] ICQ 15 Cosmos E-C Commerce Pty Ltd v Sue Bidwell & Associates Pty Ltd [2005] NSWCA 81 Degiorgio v Dunn (No 2) [2005] NSWSC 3; 62 NSWLR 284 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 Di Carlo v Dubois & Ors [2002] QCA 225 Dominic Burke v Simon Blackwood (Workers' Compensation Regulator [2015] QIRC 070 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Gersten v Cape York Land Council Aboriginal Corporation (No 2) [2004] 176 QGIG 153 House v The King (1936) 55 CLR 499 Imogen Pty Ltd v Sangwin (1996) 70 IR 254 Kanan v Australian Postal and Telecommunications Union [1992] FCA 539; (1992) 43 IR 257 Keddie & Ors v Stacks/Goudkamp Pty Ltd [2012] NSWCA 254 -- 2 of 14 -- 3 Kelsey v Logan City Council & Ors [2021] ICQ 11 Latoudis v Casey (1990) 170 CLR 534 Lemoto v Able Technical Pty Ltd & Ors [2005] NSWCA 153; 63 NSWLR 300 MIM Holdings Ltd v Automotive, Metals, Engineering, Printing and Kindred Industries Industrial Union of Employees, Queensland (2000) 164 QGIG 370 Nicholson v Carborough Downs Coal Management Pty Ltd & Ors (No 2) [2023] ICQ 003 Rosniak v Government Insurance Office (1997) 41 NSWLR 608 State of Queensland (South West Hospital and Health Service) v Crews-Bradley [2016] QIRC 93 Theseus Exploration NL v Foyster (1972) 126 CLR 507 Wanninayake v State of Queensland (Department of Natural Resources and Mines) [2014] QIRC 079 Watpac Construction Pty Ltd v The Regulator under the Work Health and Safety Act 2011 [2020] QIRC 187 Webster v Lampard (1993) 177 CLR 598 APPEARANCES: Dr V. Chen, the Appellant representing himself. Mr P. Zielinski of counsel instructed by Minter Ellison for the Respondent. Reasons for Decision [1] On 7 March 2023 Dr Victor Chen ('the Appellant') filed an amended application for costs in the Industrial Court of Queensland ('the Court'). This application follows the decision of the Court issued on 13 May 2022.1 Within that decision is a timeline and concise summary of relevant dates and events of the Appellant's various public service appeals, general protections and dismissal applications.2 1 Chen v State of Queensland (Queensland Health) [2022] ICQ 15. 2 Ibid, [8]. -- 3 of 14 -- 4 [2] Dr Chen is a cardiologist, and at the relevant time was employed on a casual basis with the Gold Coast Health and Hospital Service ('GCHHS') as a visiting medical officer.3 [3] In his application, the Appellant seeks: Pursuant to s 546 Industrial Relations Act "General Power to award costs" The applicant applies for his costs in C/2021/26 where the Court must be satisfied the respondent and their legal representatives responded vexatiously, unreasonably with no internal logical consistency filing a "Respondent's Outline of Submissions" that the applicant's public service appeal was "outside the Commission's jurisdiction" (para 2] and then Mr Zielinski, counsel instructed by MinterEllison on behalf of the respondent repeatedly argued at Hearing 23 February 2022 to the logical contrary without internal consistency that the Court should return the jurisdiction to the Commission: "the appropriate course is to refer the matter back down to be determined before - before Commissioner Knight. Those are my submissions your Honour". [Transcript page 1-24 onwards]. [4] The grounds of the Appellant's application for costs are as follows: Pursuant to [sic] 546(2)(b)(i) or (ii) the Court must be satisfied MinterEllison should repay costs incurred to the respondent and Queensland taxpayers. The grounds of the Application are detailed in an Appellant's Outline of Submissions 10 Feb 2023 filed to the Court and served to the respondents. [5] A mention of the application for costs by the Appellant was held on 8 March 2023 at which time directions were issued for the parties to file submissions and the matter was listed for hearing on 20 April 2023. [6] In the introduction to his submissions, the Appellant states the application for costs is in two parts, 'firstly seeking orders for indemnity costs to be reimbursed to the Appellant, further and/or in the alternative also seeking costs for the legal representatives of GCHHS to repay costs incurred by GCHHS on behalf of the taxpayers of Queensland - success or failure in either part of the application for costs do not depend on the other'.4 [7] The Respondent submits the application for costs should be dismissed and costs ordered against the Appellant. The application for costs was made without reasonable cause; its hopeless prospects and the Appellant's conduct in the course of the application justify an award of indemnity costs.5 Legislative Provisions 3 Chen v State of Queensland (Queensland Health) [2021] QIRC 369, [1]. 4 Appellant's submissions filed 29 March 2023, [1]. 5 Respondent's submissions filed 22 March 2023, [2]. -- 4 of 14 -- 5 [8] The Court's general power to award costs is provided by s 545 of the IR Act which relevantly states: General power to award costs (1) A person must bear the person's own costs in relation to a proceeding before the court or commission. (2) However, the court or commission may, on application by a party to the proceeding, order – (a) a party to the proceeding to pay costs incurred by another party if the court or commission is satisfied - (i) the party made the application or responded to the application vexatiously or without reasonable cause; or (ii) it would have been reasonably apparent to the party that the application or response to the application had no reasonable prospect of success; or … [9] Therefore, a party to a proceeding may only be ordered to pay costs under the IR Act if the party's application or response was vexatious or without reasonable cause or it would have been reasonably apparent to the party that the application or response had no reasonable prospect of success. Requirements of s 545 of the IR Act [10] For the purposes of s 545(2)(a)(i), whether an application is commenced vexatiously or without reasonable cause is to be assessed objectively.6 The test is to be applied when the application is made.7 [11] The same objective assessment applies in respect of s 545(2)(ii) as to whether it would have been reasonably apparent to a party that their claim had no reasonable prospects of success.8 This limb is broader than s 545(2)(i) as it can be triggered at a time subsequent to the filing of an application. [12] In Watpac Construction Pty Ltd v The Regulator under the Work Health and Safety Act 2011,9 I had the opportunity of undertaking a brief survey of the applicable principles in respect of an application under s 545 of the IR Act: Principles governing an award of costs in the Commission [12] The ordinary rule is set out in s 545(1) of the IR Act; namely that each party is to bear its own costs in relation to a proceeding in the Commission. That rule need not be applied if 6 MIM Holdings Ltd v Automotive, Metals, Engineering, Printing and Kindred Industries Industrial Union of Employees, Queensland (2000) 164 QGIG 370, 371 (MIM Holdings). 7 Ibid. 8 Baker v Salver Resources Pty Ltd [2012] FWAFB 4014, [10]. 9 [2020] QIRC 187. -- 5 of 14 -- 6 s 545(2)(a) is satisfied. In other words, costs may be awarded if the Commission is satisfied that the Respondent responded to the application vexatiously or without reasonable cause; or it would have been reasonably apparent to the Respondent that the response to the application had no reasonable prospect of success. The test for "vexatiously or without reasonable cause" [13] The principles to be applied in applications such as this was considered by Martin J in Wanninayake v State of Queensland (Department of Natural Resources and Mines).10 The case concerned the predecessor of s 545 – s 335 of the Industrial Relations Act 1999. In that case his Honour wrote: [12] An application has been made by the respondent for an order under s 335 of the Industrial Relations Act 1999. That Act permits the court to make an order that an unsuccessful applicant pay costs in circumstances where an application was made vexatiously or without reasonable cause. [13] It is completely obvious that Ms Wanninayake is distraught as a result of what has occurred to her. Regrettably, a large part of what has occurred to her in the Commission and this court has been brought about by her own misunderstanding of the procedures and the orders that might be available to her, but that is not a reason to deny a successful party its costs. The appeal was never going to succeed. It was based on a misapprehension of the original application for a stay of the decision by Deputy President Kaufman. [14] Neither the application for a stay, nor the appeal from the order dismissing that application could have succeeded. It follows that the application was made without reasonable cause, and so the jurisdiction is enlivened. [14] The Applicant referred the Commission to the decision of State of Queensland (South West Hospital and Health Service) v Crews-Bradley,11 which considered s 335(1)(a) of the Industrial Relations Act 1999 (the IR Act 1999), the equivalent to s 545(2) of the IR Act 2016: The phrase 'vexatiously or without reasonable cause' is to be read disjunctively and not in a composite way.12 It is not my understanding of the submissions of the applicant that they contend the respondent, in bringing the application, has acted 'vexatiously'; that is, with the intention of annoying or embarrassing the applicant.13 In determining the expression 'without reasonable cause' in s 335(1) of the IR Act, it cannot be said that a party has made an application 'without reasonable cause', within the meaning of s 335(1) of the IR Act simply because the applicant's argument proves unsuccessful. In considering the phrase 'without reasonable cause' Wilcox J in Kanan v Australian Postal and Telecommunications Union,14 wrote: 'It seems to me that one way of testing whether a proceeding is instituted "'without reasonable cause" is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceeding, there was no substantial prospect of success. If success 10 [2014] QIRC 079. 11 [2016] QIRC 93, [12]-[17]. 12 MIM Holdings (n 3) 371. 13 Gersten v Cape York Land Council Aboriginal Corporation (No 2) [2004] 176 QGIG 153. 14 [1992] FCA 539; (1992) 43 IR 257. -- 6 of 14 -- 7 depends upon the resolution in the applicant's favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being "without reasonable cause". But where, on the applicant's own version of the facts, it is clear that the proceeding must fail, it may properly be said that the proceeding lacks a reasonable cause.'15 In practice, the test used to determine 'without reasonable cause' is not, in many ways, dissimilar to that applied in determining a summary judgment application. That test has been variously expressed, including that a case is 'manifestly groundless' or is 'so obviously untenable that it cannot possibly succeed'.16 Martin J in Dominic Burke v Simon Blackwood (Workers' Compensation Regulator)17 in dealing with 'without reasonable cause' expressed the view that where an appeal is brought to the Commission on a footing which is misconceived and doomed to fail, costs should follow the event. [15] In MIM Holdings Ltd v AMWU,18 Hall P explained the phrase "without reasonable cause" as "objectively recognisable as one which could not succeed at the time when the application was made". [16] The test to be applied is not simply whether or not the application was unsuccessful. It is whether the application could not succeed at the time when it was made. The test for reasonable prospects of success [17] It is acknowledged that s 545 of the IR Act 2016 preserves s 335 of the IR Act 1999 by providing that a person must bear their own costs in relation to a proceeding unless the court or commission has ordered costs to another party.19 However, s 545 goes further than s 335 by giving the Commission a discretion in circumstances where a party to the proceeding made the application, or responded to the application, when there was no reasonable prospect of success. [18] As a matter of ordinary expression, the words 'reasonable prospects of success' involves weighing up the circumstances of the case to determine whether they are reasonable in the sense that they provide a rational base for a decision to proceed with a matter or, as in this case, whether to respond to the application. [19] In Keddie & Ors v Stacks/Goudkamp Pty Ltd20 the New South Wales Court of Appeal was called on to consider a costs application in the context of s 345 of the Legal Profession Act and the obligation of a law practice not to provide legal services unless the claim has reasonable prospects of success. 15 See also: Imogen Pty Ltd v Sangwin (1996) 70 IR 254 per Wilcox CJ (with whom Madgwick J agreed). 16 See: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125, 128-129 per Barwick CJ. See also Dey v Victorian Railways Commissioners (1949) 78 CLR 62, 91 per Dixon J; Theseus Exploration NL v Foyster (1972) 126 CLR 507, 514; Webster v Lampard (1993) 177 CLR 598, 602-603; Cosmos E-C Commerce Pty Ltd v Sue Bidwell & Associates Pty Ltd [2005] NSWCA 81, [37]-[38]. 17 [2015] QIRC 070. 18 MIM Holdings Ltd v Automotive, Metals, Engineering, Printing and Kindred Industries Industrial Union of Employees, Queensland (2000) 164 QGIG 370. 19 See: Explanatory Notes to the Industrial Relations Bill 2016 (Qld). 20 [2012] NSWCA 254, [58]. -- 7 of 14 -- 8 [20] In considering the phrase "reasonable prospects of success" the Court of Appeal had reference to the reasoning of Barrett J (as his Honour then was) in Degiorgio v Dunn (No 2),21 where his Honour observed: ... 'without reasonable prospects of success' ... equates its meaning with 'so lacking in merit or substance as to be not fairly arguable'. The concept is one that falls appreciably short of 'likely to succeed'. [21] Beazley JA (with whom Barrett JA and Sackville AJA agreed) held that the phrase 'without reasonable prospects of success' means 'not fairly arguable' and as to establish 'on the basis of provable facts and a reasonably arguable view of the law that the claim has reasonable prospects of success'.22 [13] Davis J in Kelsey v Logan City Council & Ors,23 identified some of the principles which apply in relation to the operation of s 545 of the IR Act: [25] Section 545 and provisions like it have been the subject of analysis in various decisions. The following principles can be identified: i. The starting point is that each party bears their own costs. ii. A discretion to depart from that point only arises, relevantly here, if one of the jurisdictional facts identified in s 545(2)(a)(i) or s 545(2)(a)(ii) are established. iii. The assessment of "reasonable cause" in s 545(2)(a)(i) is: (i) an objective assessment; and (ii) made considering the facts existing as at the time of the institution of the proceedings, here the appeal. iv. Section 545(2)(a)(ii) prescribes a separate and distinct jurisdictional fact giving rise to a discretion to award costs. In consideration of whether s 545(2)(a)(ii) is engaged, facts which arise after the commencement of the proceedings may be relevant.24 [14] Martin J observed in Blackwood v Egan,25 that an order for costs is a quintessential exercise of discretion and that the principles in House v The King26 will apply. The principles that govern an award of costs are well established. In Latoudis v Casey,27 Mason CJ wrote: It will be seen from what I have already said that, in exercising its discretion to award or refuse costs, a court should look at the matter primarily from the perspective of the defendant. To do so conforms to fundamental principle. If one thing is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of the unsuccessful party. 21 [2005] NSWSC 3; 62 NSWLR 284. 22 See also: Lemoto v Able Technical Pty Ltd & Ors [2005] NSWCA 153; 63 NSWLR 300. 23 [2021] ICQ 11. 24 Ibid. 25 [2014] ICQ 020. 26 (1936) 55 CLR 499. 27 (1990) 170 CLR 534, 543 [13]. -- 8 of 14 -- 9 They are compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings.28 His Honour the Chief Justice further stated: Most of the arguments which seek to counter an award of costs against an informant fail to recognize this principle and treat an order for costs against an informant as if it amounted to the imposition of a penalty or punishment. But these arguments only have force if costs are awarded by reason of misconduct or default on the part of the prosecutor. Once the principle is established that costs are generally awarded by way of indemnity to a successful defendant, the making of an order for costs against a prosecutor is no more a mark of disapproval of the prosecution than the dismissal of the proceedings.29 McHugh J said: The rationale of the order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred. The order is not made to punish the unsuccessful party. Its function is compensatory.30 Application for costs [15] The Respondent submits that the Appellant seeks to reference exchanges during oral argument in the Conversion Appeal. Briefly, counsel for the Respondent raised an alternative argument in that if the Court found against the Respondent on the Conversion Appeal, the appropriate course was for the matter to be returned to Knight IC to determine outstanding substantive issues. This was to deal with the question of whether the Appellant had conversion rights and whether the earlier findings in the Reprimand Matter had any bearing on the continued utility of the Appellant's conversion appeal. Because an alternative argument was raised is unexceptional and cannot be described as conduct that triggers the jurisdictional prerequisite under either s 545(2)(a) or (b) of the IR Act. The Respondent submits it is not clear how by putting the alternative position to the Court could possibly have caused the Appellant to incur costs.31 [16] The Appellant's schedule to his amended application refers to numerous contested and irrelevant assertions. Briefly, these are: (a) the Appellant alleges that the Respondent did not undertake the further show cause ordered by Knight IC. This is not only irrelevant but inaccurate for reasons already articulated;32 28 Latoudis v Casey (1990) 170 CLR 534, 543 [13]. 29 Latoudis v Casey (1990) 170 CLR 534. 30 (1990) 170 CLR 534, 567. 31 Respondent's submissions filed 22 March 2023, [14]. 32 Respondent's submissions filed 22 March 2023, [8], [9]. -- 9 of 14 -- 10 (b) the Appellant makes various assertions as to the inferences which can be drawn from the Respondent's hiring practices and maintains there is an operational need for his employment. These matters are contested; (c) in the application schedule at paragraphs [14] to [20] and [29] to [35], the Appellant views this application for costs as a means of redressing some broader injustice. Those submissions do not grapple at all with how it can be said that the Respondent or its lawyers acted in a manner contemplated by s 545(2)(a) or (b) in respect of the Conversion Appeal; (d) in paragraph [21] the Appellant further demonstrates his misunderstanding as to how the Respondent intends to rely on the factual findings of Knight IC in the Reprimand Matter. There will be no 're-litigation' of those matters. However, the Commissioner's findings and the Appellant's continued lack of insight into his own behaviour may be relevant to the disposition of his substantive proceedings and the extant conversion appeal (which will be heard after the substantive proceedings are determined); and (e) paragraphs [25], [26] and [35(b)] refer to the Respondent's conduct from April and November 2020 that have absolutely no bearing on the application for costs. They also reveal a misunderstanding by the Appellant of the extremely broad definition of potential 'corrupt conduct' under the Crime and Corruption Act 2001 (C'th). That broad definition explains why the Respondent understood that it had reporting obligations in respect of the conduct that was dealt with as part of the Reprimand Matter.33 [17] In the submissions of the Respondent 'on no reasonable view could it be said that the criteria in s 545(2) have even arguably been triggered'. I agree. [18] The Respondent submits that in considering the reasonableness of the Appellant's application and whether an application has been made without reasonable cause calls for an objective assessment whether, at the time it was launched, the application was doomed to failure.34 Hindsight has no place in such an assessment.35 [19] The Conversion Appeal concerned a question of construction and while that was contested, the Appellant's legal representatives did not suggest that the Respondent's submissions were vexatious or without reasonable cause or prospects of success; nor was it suggested that the Respondent's legal representatives engaged in an unreasonable act in the continuation or conduct of the proceeding. The Respondent was the beneficiary 33 Respondent's submissions filed 22 March 2023, [15]. 34 Watpac Construction Pty Ltd v The Regulator under the Work Health and Safety Act 2011 [2020] QIRC 187, [14]. 35 Kelsey v Logan City Council & Ors (No 9) [2022] QIRC 342, [122]. -- 10 of 14 -- 11 of a first instance decision in its favour and hence it cannot be criticised for defending that decision.36 [20] The Appellant has failed to demonstrate a good case for departure from the general rule established by s 545(1) of the IR Act as to why he should have an award of costs. Accordingly, the Appellant's application for costs ought to be dismissed. Costs sought by the Respondent [21] The Respondent seeks the costs of defending the Appellant's application for costs before the Court on an indemnity basis. [22] The Respondent points to the following factors which they submit should result in the conclusion that it is in the interests of justice that they recover their costs on an indemnity basis. In particular, • in retaliation for the Respondent pursuing its costs in the Further Interlocutory Application. The Appellant did not deny such motive at the Mention on 8 March 2023; • the extraordinary delay in bringing the application for costs; • that delay leads to an obvious inference the Appellant had been counselled against bringing such an application by his former legal representatives. Aside from the objective hopelessness of this case, the Appellant must have subjectively been aware the application was doomed; and • prior to the Mention on 8 March 2023 the Respondent's solicitors wrote to the Appellant urging him to discontinue his application and seek legal advice. The Appellant was put on notice the Respondent would seek indemnity costs if he failed to do so. He was advised that the Respondent would not pursue him for costs if he discontinued the matter. The Appellant failed to engage with the Respondent in that respect.37 [23] On 22 March 2023 an affidavit of Catherine Lyndon was filed in the Industrial Registry deposing to the costs incurred by the Respondent, and which they sought pursuant to s 545(2)(a) (and in the alternative s 545(2)(b)) of the IR Act.38 36 Respondent's submissions filed 22 March 2023, [16]. 37 Respondent's submissions filed 22 March 2023, [22]-[26]; Affidavit of Catherine Lyndon, filed 22 March 2023. 38 Respondent's submissions filed 22 March 2023, [27]. -- 11 of 14 -- 12 [24] The affidavit of Catherine Lydon annexes a letter sent to Dr Chen on 8 March 2023. In short, the letter brought to the attention of Dr Chen that his application for costs "… is fundamentally misconceived, lacks any reasonable prospects of success and is bound to fail". Ms Lydon went on to write: If you do not withdraw your misconceived and groundless application by 12 noon on Monday 13 March 2023, we are instructed to seek an order that you pay the Health Service's costs of responding to this particular application on an indemnity basis. These costs are likely to exceed $5,000. As we have explained in other similar correspondence, the purpose of this letter is not to be threatening, but instead to explain why your application will fail and put you on notice of the Health Service's intentions in relation to costs. This is to avoid you pursuing a groundless application, wasting the Health Service's public funds in responding to it, and ultimately risking having to pay the Health Service's legal costs. We again strongly urge you to seek independent legal advice.39 [25] Dr Chen did not respond to the correspondence.40 [26] Notwithstanding the warning concerning costs and the conduct of the mention on 8 March 2023, Dr Chen chose to continue with what was, on any objective view, a hopeless application. It lacked any reasonable prospects of success. [27] It must have been apparent to Dr Chen at or following the mention of 8 March 2023 that he had no prospects of success. If he was in any doubt, the correspondence from Minter Ellison of the same date ought to have made the position clear. Moreover, it brought into focus the danger of proceeding with an objectively flawed application. [28] The accepted rationale for making an order for costs is that a measure of indemnity should be conferred upon the Respondent for the costs it has been obliged to incur in responding to a proceeding which is "objectively recognisable as one which could not succeed at the time when the application was made". [29] The central principle guiding the exercise of the discretion to award indemnity costs was stated by the New South Wales Court of Appeal in Rosniak v Government Insurance Office41 and adopted by the Court of Appeal in Di Carlo v Dubois & Ors:42 " … the court requires some evidence of unreasonable conduct, albeit that it need not rise as high as vexation. This is because party and party costs remain the norm, although it is common knowledge that they provide an inadequate indemnity. Any shifts to a general or common rule that indemnity costs should be the order of the day is a matter for the legislature or the rule maker."43 39 Affidavit of Catherine Lyndon, filed 22 March 2023, CAL-1. 40 Affidavit of Catherine Lydon filed on 22 March 2023, [5]. 41 (1997) 41 NSWLR 608. 42 [2002] QCA 225, [38]. 43 Ibid. -- 12 of 14 -- 13 [30] In Nicholson v Carborough Downs Coal Management Pty Ltd & Ors (No 2)44 Davis J whilst granting indemnity costs recognised that it would be a rare case which justifies an award of indemnity costs in this Court. His Honour wrote: [36] There are dangers in applying cases decided in a "costs follow the event" regime to considerations under s 545 of the IR Act. As I observed in Kelsey v Logan City Council & Ors:45 [42] The filing of proceedings which are 'foredoomed to fail' would often, in a regime where costs generally follow the event, result in an order that the costs be assessed on an indemnity basis. [43] However, that is not the regime established by s 545 of the IR Act. The discretion to award costs only arises at all where the appeal is filed 'vexatiously or without reasonable cause' or it was 'reasonably apparent [to] the appellant that [the appeal] had no reasonable prospect of success'. Even when one of those preconditions are fulfilled, costs on any basis do not inevitably follow. A discretion arises to depart from the usual rule established by s 545(1), namely that each party bear their own costs. [44] In a regime where even vexation only gives rise to a discretion to award costs, it cannot be that there is a general rule that commencing a proceeding which is 'foredoomed to fail' (a term synonymous with 'no reasonable prospect of success') will lead to an award of indemnity costs.46 [31] It is recognised that an award of costs against an unsuccessful party on an indemnity basis is a departure from the norm. However, the Appellant’s unreasonableness in the conduct of these proceedings take this matter outside the norm. [32] The Appellant's argument on the application for costs consisted mostly of an attempt to revisit and reargue matters which have been or are being agitated in the Commission. The Appellant did not propose any arguments to answer the submissions of the Respondent. Rather than concentrate on the application for costs and the issues which arise under s 545 of the IR Act, he asserts, without any basis whatever, that the Respondent's response to the appeal and their application for costs was vexatious. [33] The Appellant's submissions make a misconceived assertion that Minter Ellison ought to be required to repay costs incurred by its own client. Moreover, the Appellant used the application for costs as a platform to continue his general attack on the Respondent. [34] The application for costs was brought to the Court on a footing which was misconceived and doomed to fail. The application advanced by the Appellant was on any view, 'so lacking in merit or substance as to be not fairly arguable'.47 44 [2023] ICQ 003. 45 [2021] ICQ 11. 46 Nicholson v Carborough Downs Coal Management Pty Ltd & Ors (No 2) [2023] ICQ 003. 47 Degiorgio v Dunn (No 2) [2005] NSWSC 3; 62 NSWLR 284. -- 13 of 14 -- 14 [35] The discretion to award costs has been enlivened. [36] I see no discretionary reason to withhold the making of an order for costs in favour of the Respondent and accordingly, an order for costs is therefore appropriate. [37] Moreover, I do not consider that it is appropriate that the Health Service ought not to receive the benefit of an indemnity order for costs. In my view, it is in the interests of justice that such an order be made. Orders [38] I order that: 1. The Appellant's application for costs is dismissed. 2. The Appellant pay the Respondent's costs of defending the application for costs together with the costs of the Respondent's application for costs on an indemnity basis. -- 14 of 14 --