All Is 1 Pty Ltd T/A Banga Legal v Raylook Pty Ltd
[2023] FWCFB 7
•13 JANUARY 2023
| [2023] FWCFB 7 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
All Is 1 Pty Ltd T/A Banga Legal
v
Raylook Pty Ltd
(C2022/6942)
| VICE PRESIDENT CATANZARITI | SYDNEY, 13 JANUARY 2023 |
Appeal against decision [2022] FWC 2495 of Commissioner O'Neill at Melbourne on 19 September 2022 in matter number U2022/5842 – permission to appeal refused.
All IS 1 Pty Ltd T/A Banga Legal (the Appellant) has lodged an appeal under s.604 of the Fair Work Act 2009 (Cth) (the Act) against a decision[1] (the Costs Decision) and order[2] of Commissioner O’Neill (Commissioner)[3] made on 19 September 2022. Permission to appeal is required. The matter was listed for hearing on the question of permission to appeal, which was heard on 5 December 2022.
The Appellants were the solicitors for an applicant who was seeking an unfair dismissal remedy in matter number U2022/4359. The Commissioner dismissed that application on 19 May 2022, with the reasons for decision recorded in Teagan Salton v Raylook Pty Ltd[2022] FWC 1211 (Salton v Raylook). In summary, that application was dismissed on the basis that Ms Salton had not served the “minimum employment period” and was therefore not eligible to bring an application for unfair dismissal.
Following Salton v Raylook, the Respondent applied for costs on four separate grounds. Two of those grounds were successful and two were rejected. An order was made against the Appellant in favour of the Respondent for $3,300, pursuant to s.401(1)(1A)(b) of the Act. The Costs Decision records the reasons for that order.
Principles – permission to appeal
An appeal under s.604 of the Act is an appeal by way of rehearing and the Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision maker.[4] There is no right to appeal and an appeal may only be made with the permission of the Commission.
By s.400(1), despite s.604(2), the Commission must not grant permission to appeal from a decision made by the Commission “under this Part” unless the Commission considers that it is in the public interest to do so. The reference to “this Part” in s.400(1) is to Part 3-2 of the Act.
As an order for costs under s.401 of the Act is a decision made under Part 3-2 of the Act, this appeal is one to which s.400 of the Act applies. The test under s.400 is “a stringent one.”[5]
The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.[6] The public interest is not satisfied simply by the identification of error,[7] or a preference for a different result.[8] In GlaxoSmithKline Australia Pty Ltd v Makin a Full Bench of the Commission identified some of the considerations that may attract the public interest:
“... the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters...”[9]
It will rarely be appropriate to grant permission to appeal unless an arguable case of appealable error is demonstrated. This is so because an appeal cannot succeed in the absence of appealable error.[10] However, that the Member at first instance made an error is not necessarily a sufficient basis for the grant of permission to appeal.
An application for permission to appeal is not a de facto or preliminary hearing of the appeal. In determining whether permission to appeal should be granted, it is unnecessary and inappropriate for the Full Bench to conduct a detailed examination of the grounds of appeal.[11] However, it is necessary to engage with the appeal grounds to consider whether they raise an arguable case of appealable error.
The decision under appeal
The Costs Decision awarded the Respondent costs on two grounds. They were:
· First, that Banga Legal “acted unreasonably in continuing to contend that Raylook was a small business despite the evidence filed by Raylook and the absence of any countervailing evidence.”[12]
· Second, that there “was no basis whatsoever for the allegation that Raylook had not complied with the Commission’s Order [made on 12 May 2022 for the production of documents].”
Having regard to how the Appellant developed its application for permission to appeal, it is convenient to first summarise the salient findings made by the Commissioner.
The Respondent’s business was a specialised dentistry practice. The Respondent’s evidence was given by its sole director and shareholder. He filed a witness statement dated 2 May 2022. His evidence was that the Respondent employed four staff: an office manager; two clinical chairside staff and an employee to manage instruments. The applicant at first instance, Ms Salton, was a Chairside Assistant. Payroll extracts showed five employees in the relevant period.[13]
On 3 May 2022 and 12 May 2022, an employee of Banga Legal filed witness statements directed at showing that there were more than 15 employees. The high watermark of those statements was to show that Raylook had various associated entities, as evidenced by company searches. Notwithstanding, the witness statements deposed as follows (our emphasis):
· From the statement dated 3 May 2022:
“Despite the Respondent’s assertion that it falls within the Small Business Code, there are associated entities within Australia under the Trust which means there are more than 15 employees.”
· From the statement dated 12 May 2022:
“Due to the number of associated entities, the Applicant asserts that the Respondent has more than 15 employees and does not meet the criteria of the Small Business Code.”
On 12 May 2022, Banga Legal also made an application for an order to produce. As the Costs Decision records, 14 categories of documents were initially sought. While the issue was “finely balanced”, a narrower production order was issued, returnable on 13 May 2022.
On 13 May 2022, Raylook responded to that order with a further witness statement and copies of “screen shots” of two documents in its possession that were responsive to the order. The screen shots were of an extract from, it appears, the Respondent’s payroll software program.
Later, on 13 May 2022, the Applicant (Appellant) filed submissions that, among other matters, asserted non-compliance with the production order. Relevantly, those submissions stated at paragraph 7(e) (our emphasis):
“This order has not been properly complied with, the Respondent has simply reproduced screen shots of extracts found in his first statement. This is not sufficient to comply with the orders and a further Jones v Dunkel inference can be made in this respect, that the failure to comply in not properly producing the correct lists, gives rise to a negative inference that those lists would not have assisted the Respondent’s case.”
In relation to the number of employees, the Commissioner found there were only six employees, consistent with the Respondent’s evidence. The Commissioner observed (footnotes omitted, emphasis added):[14]
“The Applicant submitted that by not producing the ‘correct lists’, the Order to Produce had not been properly complied with, as the Respondent had simply reproduced screen shots of material already provided in his witness statement. However, no basis for this submission was provided. For example, there was no evidence by the Applicant that during her employment she had seen a larger number of employees at work or had any other reason to question the Respondent’s evidence that there was a total of 6 employees. This is not a case where there is a fine line in that the number of employees is close to 15 and the evidence is equivocal. There is simply no basis to doubt Dr Dickinson’s evidence and conclude that there were, in fact, more than double the number of employees that he had attested to and provided documentary evidence in support of.”
The unfair dismissal application was dismissed and the application for costs under s.401 of the Act followed. Section 401(1A) of the Act relevantly provides:
“(1A) The FWC may make an order for costs against the representative for costs incurred by the other party to the matter if the FWC is satisfied that the representative caused those costs to be incurred because:
(a) the representative encouraged the person to start, continue or respond to the matter and it should have been reasonably apparent that the person had no reasonable prospect of success in the matter; or
(b) of an unreasonable act or omission of the representative in connection with the conduct or continuation of the matter.”
The Costs Decision recorded the respective submissions of the parties from paragraphs [5] – [20]. Paragraphs [21] – [29] set out the Commissioner’s consideration and conclusions. The paragraphs of the Costs Decision that the Appellant seeks to impugn are [23] – [24] and [26]. They are as follows:
[23] I am satisfied that Banga Legal acted unreasonably in continuing to contend that Raylook was a small business despite the evidence filed by Raylook and the absence of any countervailing evidence. In particular, it was unreasonable to cause Ms Silby to make two witness statements contending that the fact there were a number of associated entities meant it had more than 15 employees. Ms Silby did not provide any basis for her conclusion and it is plainly not the case. I reject Banga Legal’s submission that there was no evidence that it caused the Employee to adduce Ms Silby’s evidence. A client is not entitled to direct its legal representative to adduce evidence itself. Banga Legal actively decided to arrange for Ms Silby to make and file two witness statements, and this was unreasonable in the circumstances. Whilst the Employee did not have to simply accept Dr Dickinson’s evidence and was entitled to test the evidence, the problem is that it did not file any evidence or make any submissions that provided a foundation to dispute this evidence. I wholly reject the submission that there was a basis for Ms Silby’s evidence. This submission was inappropriate and without foundation. That “there is no reason to suggest the Applicant is any different” to trusts being “notoriously” created for “tax minimisation purposes” is itself a spurious contention.
[24] I am satisfied that Banga Legal acted unreasonably causing Raylook to incur the cost of engaging counsel to prepare for and appear at the jurisdiction hearing on 17 May 2022, in the sum of $3,300.
…
[26] I am satisfied that the third act of Banga Legal, was also unreasonable. There was no basis whatsoever for the allegation that Raylook had not complied with the Commission’s Order. The costs incurred in relation to this unreasonable act are the same as the costs incurred in relation to the first unreasonable act.
Public Interest
The Notice of Appeal did not list specific grounds of appeal as such but, rather, asserted a somewhat more general statement concerning paragraph [23] of the Costs Decision (which we will call “Ground 1”). The Notice of Appeal stated no “unreasonable conduct was enlivened” because it was “reasonable for enquiries of this type to [be] made as part of accurately preparing a claim.”
The Notice of Appeal did not impugn the second ground (which we will call “Ground 2”) regarding the allegation of non-compliance with the order for production.
The Appellant’s submissions in support of permission to appeal, prepared by counsel, were more detailed. They also sought – and leave was granted - to extend the application for appeal to Ground 2.
In respect of both Grounds, the Appellant’s written submissions contend that the correct principles regarding the operation of s.401 of the Act were identified at [18] of the Costs Decision but it was “insufficient to simply invoke the words of s.401 of the FW Act without explaining the reasons for so concluding in the costs decision at [23]-[24] and [26].” In substance, at least for Ground 1, it is contended that inadequate reasons were given (and, presumably, if adequate reasons were given, a different conclusion would have been made or a misapplication of legal principle revealed).
In oral submissions, the Appellant’s submissions were somewhat more nuanced and broader for each Ground. For example, for Ground 1, it was contended there were “six entities identified at that point [when Ms Salton was dismissed] and what the appellant says, in short, encompasses that it was reasonable for it to make inquiries about those entities because it may have raised a question about whether the respondent was a small business or not a small business”[15] (our emphasis).
For Ground 2, it was contended that “it's reasonable for a party to ensure that there's been compliance an order” and to “query the compliance with the order”.[16]
Having considered the Appellant’s written and oral submissions and all the materials filed on appeal, we are not satisfied that there is an arguable case of error. For Ground 1, we consider that a fair reading of the Costs Decision shows clearly that the Commissioner considered the applicable legal principles (which are not impugned) and stated the factual basis for her conclusions in some detail. For Ground 2, the Commissioner recorded that there was “no basis whatsoever” for the allegation of non-compliance to have been made. Again, the Commissioner’s reasons could not be more clear and the Appellant did not, when specifically queried, seek to assert that the finding there was “no basis whatsoever” was incorrect.[17]
We also reject the broader contentions (if that is what was intended) made orally at the permission to appeal hearing regarding the ability of a party to “query” evidentiary matters or to “ensure” compliance with Commission orders. It is for this reason that we set out the specific evidence above, which was referred to by the Commissioner in the Costs Decision.
In respect of Ground 1, the witness statements filed on 3 and 12 May 2022 go beyond a mere “query” of the number of employees. Those statements positively depose that “there are” more than 15 employees with the Respondent. Similarly for Ground 2, the submissions filed on 13 May 2022 go well beyond querying compliance with the production order and positively assert a “failure to comply” to such an extent that the inferences described in Jones v Dunkel ought to have been engaged. It should be recalled that the Commissioner’s finding – which appears clearly correct – was that there was “no basis whatsoever” for that contention.
We have considered whether this appeal attracts the public interest, and we are not satisfied, for the purposes of s.400 that:
·there is a diversity of decisions at first instance so that guidance from an appellate body is required of this kind;
·the appeal raises issues of importance and/or general application;
·the Costs Decision manifests an injustice, or the result is counter intuitive; or
·the legal principles applied by the Commissioner were disharmonious when compared with other decisions dealing with similar matters.
In summary, the basis on which the Commissioner reached her Costs Decision was through the application of an orthodox approach to the determination of the Respondent’s application and by applying the correct legal principles. The Commissioner’s reasons were appropriate to the issues at hand, noting that an earlier decision had been issued, the costs issues were narrow in scope, and the amount in question was a modest sum.
Conclusion
Permission to appeal is refused.
VICE PRESIDENT
Appearances:
Mr M. McKenney, of counsel for the Appellant
Dr A. Dickinson, director, for the Respondent
Hearing details:
2022.
Melbourne (by video via Microsoft Teams):
December 5.
[1] [2022] FWC 2495. In the Costs Decision, the Appellant was called “Banga Legal Pty Ltd”. The name of the Appellant was amended to its present form, as set out in All IS 1 Pty Ltd t/a Banga Legal v Raylook Pty Ltd[2022] FWC 2929.
[2] PR746007.
[3] Now Deputy President O’Neill. For consistency with the decisions below, we refer to the Deputy President as ‘Commissioner’ in these reasons.
[4] Coal and Allied Operations Pty Ltd v AIRC (2000) 203 CLR 194 [17] per Gleeson CJ, Gaudron and Hayne JJ (Coal and Allied Operations Pty Ltd).
[5] Coal & Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54, 192 FCR 78, 207 IR 177 at [34], [43].
[6] O’Sullivan v Farrer (1989) 168 CLR 210 at 216-217 per Mason CJ, Brennan, Dawson and Gaudron JJ: applied in Hogan v Hinch (2011) 243 CLR 506 at [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty Ltd v Lawler and others (2011) 192 FCR 78 at [44] – [46].
[7] GlaxoSmithKline Australia Pty Ltd v Makin[2010] FWAFB 5343, 197 IR 266 at [24]-[27].
[8] GlaxoSmithKline Australia Pty Ltd v Makin[2010] FWAFB 5343, 197 IR 266 at [26]-[27], Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/ Warkworth[2010] FWAFB 10089 at [28], affirmed on judicial review; Coal & Allied Mining Services Pty Ltd v Lawler (2011) 192 FCR 178; NSW Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663, 241 IR 177 at [28].
[9] [2010] FWAFB 5343, 197 IR 266 at [24] – [27].
[10] Wan v AIRC (2001) 116 FCR 481 at [30].
[11] Trustee for The MTGI Trust v Johnston [2016] FCAFC 140 at [82].
[12] Costs Decision at [23].
[13] Salton v Raylook at [2], [9].
[14] Salton v Raylook at [12].
[15] PN 17
[16] PN 19
[17] PN 44 - 47
Printed by authority of the Commonwealth Government Printer
<PR749622>
0