Andison and Leading Edge Design and Print Group Pty Ltd and Anor

[2014] FCCA 1706

FEDERAL CIRCUIT COURT OF AUSTRALIA

ANDISON & LEADING EDGE DESIGN AND PRINT GROUP PTY LTD & ANOR [2014] FCCA 1706

Catchwords:
INDUSTRIAL LAW – Small claims application – non-payment of wages – respondents in default – undefended hearing.

Legislation:  

Fair Work Act 2009 (Cth) ss.548
Federal Circuit Court Rules 2001 (Cth) r.13.03A, 13.03B, 13.03C, 45.11(2)

McShane v Image Bollard Pty Ltd [2011] FMCA 215
Black v Young Republic & Anor [2012] FMCA 729
Jones v Groovy Freighters Pty Ltd [2010] FMCA 673
Lebot v Energetic IT Pty Ltd [2011] FMCA 755

Applicant: SHANE ANDISON

First Respondent:

LEADING EDGE DESIGN AND PRINT GROUP PTY LTD

ACN 116 246 863

Second Respondent:

THE TRUSTEE FOR THE VERMES FAMILY TRUST TRADING AS LEADING EDGE WEB

ABN 501 40 885 072

File Number: (P)MLG 403 of 2014

Judgment of: Judge O’Sullivan

Hearing date: 23 July 2014

Date of Last Submission: 23 July 2014

Delivered at: Melbourne

Delivered on: 23 July 2014

REPRESENTATION

The Applicant: Appeared in person

The First Respondent: No appearance

The Second Respondent: No appearance

ORDERS

THE COURT ORDERS THAT:

1. The Applicant have leave to proceed undefended pursuant to Rules 13.03A(2)(a), (b)(ii), (iii), (vii) and 13.03B(2)(d) and/or 13.03C(1)(e) of the Federal Circuit Court Rules 2001 (“the Rules”).

THE COURT DECLARES THAT:

1. The Respondents contravened the Professional Employees Award 2010 and the Fair Work Act 2009 (Cth) (“the FW Act”).

THE COURT ORDERS THAT:

1. Pursuant to s.545(2) of the FW Act the Respondents pay to the Applicant the sum of $4,235.00 (gross) within 21 days of service of these orders.

2. The Applicant shall serve the Respondents with a sealed copy of these orders within 14 days.

3. All extant applications be otherwise dismissed and the proceedings be removed from the Pending Cases List.

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT MELBOURNE

(P)MLG403 of 2014

SHANE ANDISON

Applicant

And

LEADING EDGE DESIGN AND PRINT GROUP PTY LTD

First Respondent

And

THE TRUSTEE FOR THE VERMES FAMILY TRUST TRADING AS LEADING EDGE WEB

Second Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

1. Before the Court today, 23 July 2014, is an application filed on

   
   

   6 March 2014 by Shane Andison (“the applicant”). The application was filed in the small claims list of the Fair Work division of the Court.

   
   

   It was supported by a form 5 and an affidavit which the applicant affirmed on 6 March 2014. The respondent to the application as filed was Attila Vermes.

2. The application was given a first court date on 14 May 2014.

   
   

   On 14 May 2014, the applicant appeared in person. There was no appearance by or on behalf of the respondent as named to the application. There had been filed on 21 March 2014, an affidavit of service by the applicant. The affidavit made clear that the application, form 5 and supporting affidavit material had been served on the respondent as named on 21 March 2014.

3. On 14 May 2014, the applicant tendered an exhibit, being an extract from the ASIC database for an organisation known as Leading Edge Design and Print Group Pty Ltd. This was one of the organisations that the applicant said in his affidavit material that the respondent as named in the application had been involved with and whom he had worked for during the period of his employment as set out in his application, form 5, and supporting affidavit.

4. On 14 May 2014, the Court made the following orders:

   “THE COURT ORDERS THAT:

   1.The Applicant has leave to amend the name of the respondent to his application filed on 6 March 2014 to be Leading Edge Design and Print Group Pty Ltd, ACN 116 246 863 as the First Respondent and the Trustee for the Vermes Family Trust trading as Leading Edge Web ABN 501 40 885 072 as the Second Respondent.

   2.The Applicant shall serve the First and Second Respondents with a sealed copy of the following documents within 14 days from the date of these orders:

   (a)     application filed on 6 March 2014;

   (b)     affidavit filed 6 March 2014;

   (c) a copy of the orders made this day.

   3.The First and Second shall file and serve a response and affidavit within 14 days of service.

   4.The proceedings be adjourned to the Small Claims List on 23 July 2014 commencing at 10.00 am at the Federal Circuit Court of Australia at Melbourne.

AND THE COURT NOTES:

A.Subject to compliance with order (2), in the event the First and Second Respondents fail to comply with these orders and/or attend Court on the adjourned date then the Applicant may seek leave, at the discretion of the presiding Judge, to proceed undefended with the orders sought in his application filed on 6 March 2014.”

1. Since 14 May 2014 the applicant has filed two affidavits of service on

   
   

   28 May 2014. Those affidavits make clear that he has complied with the orders made on 14 May 2014. Those affidavits of service also make clear that Leading Edge Design and Print Group Pty Ltd and the Trustee for the Vermes Family Trust trading as Leading Edge Web ABN 501 885 072 (“the respondents”) had had notice of the orders made on 14 May 2014 and the applicant’s material since 23 May 2014.

2. The matter has returned to Court today, 23 July 2014. The applicant has appeared in person. There has been no appearance by or on behalf of the respondents. There has been no contact made with the Court by or on behalf of the respondents. The applicant has told the Court today that he has not heard from or had contact with the respondents save for receiving since the last court date a PAYG statement from one of the respondents purporting to be a group certificate for that period of his employment with one of the particular entities.

3. The applicant, in his application filed back on 6 March 2014, indicated that he is 28 years of age. He worked for Leading Edge Web in Toorak Road, Melbourne Victoria between 23 July 2012 and 1 November 2013 as a digital project manager on a full-time basis.

4. As set out in the form 5, the applicant says his employment during that period was governed by the Professional Employees Award 2010.
   The applicant says that following the conclusion of his employment (which was brought to an end, he says, by his resignation) he has not received what he calculated (for the reasons set out in his form 5) he believed he was owed having regard to the applicable industrial instrument. This was $4,235.00 (gross).

1. In the form 5 the applicant said at Part I:

   “I am owed $4235.00 in unpaid wages by Attila Vermes, who was my employer and company director during my time at Leading Edge Web. I worked in total 1 year, 3 months, 9 days at Leading Edge Web, from 23 July 2012 to 1 November 2013.

   I gave my one month’s written notice in accordance with our contract, after conversations we had where Attila said he was focusing on his other business, Giant Invitations. In addition, barely ever did I receive payslips within 1 day of being paid, and would have to ask many times to even receive them at all (still there are many missing). Also, all of my superannuation payments were many months late, and I have had to contact the ATO to launch an investigation in order to get two final amounts paid. Finally, very often late or partial payments of my way also contributed to this decision, as it put a lot of stress on my financial situation. I proactively gave notice on 1^st Oct 2013 in good faith, and he assured me that all my entitlements would be covered before my last day. I was also very reasonable and offered to take all my annual leave days leading up to my last day of employment, as Attila suggested to me, so he would not have to cover these as additional cash. I’ve attached my written resignation notice letter.

   I worked hard up to my final day, projects were being launched and I have customers and co-workers that will attest I was indeed working up to 1 Nov 2013.

   The late or partial payments of my wage increased significantly up to this time, and also once notice was given. Since I have left the company, there have been no payments made to cover the wages I am owed, although Attila does claim through email that he’ll “have an update shortly” and “will send through the payment receipt”. I’ve attached some emails showing this.

   I have been through the Fair Work Ombudsman mediation process and during this Attila and myself agreed to a Terms of Settlement which was written up by our mediator, which ordered the following payment schedule: …

   Payment date:  Payment amount:

   Friday 17^th January 2013   $1,058.75

   Friday 24^th January 2013   $1,058.75

   Friday 31^st January 2013   $1,058.75

   Friday 7^th February 2013   $1,058.75

   Total amount payable:   $4,235.00

   Since the mediation session, Attila has not returned the signed agreement, and is unable to be contacted by the Fair Work Ombudsman and hence they have recommended taking further action.

   The pay periods outstanding are outlined on the next page, along with dates and net amounts owed.

   My wage was $65,000 + Super (“I’ve attached my contract which shows this), meaning my Gross pay was $2,500 a pay period (fortnight). My net pay was $1974.00 a fortnight.

   The values below are the net values.

   From: Monday, 28 October 2013 To: Friday 1 November 2013

   (Half period) $987.00 Net due

   From: Monday, 14 October 2013 To: Sunday 27 October 2013

   (Full period) $1974.00 Net due

   From: Monday, 30 September 2013 To: Sunday 13 October 2013

   (Full period) $1274.00 Net due

   ($700.00 was paid late on 21-10-2013)

   TOTAL: $4235.00 Net due

   I have also attached the two PAYG summaries I received, as an additional note which I am concerned about is that Attila changed the company structure during my employment without notifying me at all. I only found out about this when I received PAYG payment summaries from two different companies, with the same dates – these are attached.

   Leading Edge Design & Print Group P/L (23-07-2012 – 30-06-2013) ABN: 75 116 246 863

   Leading Edge Web (23-07-2013 – 30-06-2013) ABN: 50 140 885 072

   I have provided the following supportive documents:

   ·Written resignation letter

   ·Emails:

   ·Email to Attila on my last day of employment (Not answered)

   ·Follow up email to Attila regarding outstanding wages

   ·Employment contract

   ·Two PAYG summaries I received

   ·Example payslip (the latest one I believe I received)

   ·…”

2. The application is governed by section 548 of the FW Act which states:

   “Plaintiffs may choose small claims procedure

   (1)Proceedings are to be dealt with as small claims proceedings under this section if:

   (a)a person applies for an order (other than a pecuniary penalty order) under Division 2 from a magistrates court or the Federal Circuit Court; and

   (b)the order relates to an amount referred to in subsection (1A); and

   (c)the person indicates, in a manner prescribed by the regulations or by the rules of the court, that he or she wants the small claims procedure to apply to the proceedings.

   (1A)  The amounts are as follows:

   (a)an amount that an employer was required to pay to, or on behalf of, an employee:

   (i)     under this Act or a fair work instrument; or

   (ii)     because of a safety net contractual entitlement; or

   (iii)   because of an entitlement of the employee arising under subsection 542(1);

   (b)an amount that an outworker entity was required to pay to, or on behalf of, an outworker under a modern award.

   Limits on award

   (2)In small claims proceedings, the court may not award more than:

   (a)$20,000; or

   (b)if a higher amount is prescribed by the regulations--that higher amount.

   Procedure

   (3)In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:

   (a)     in an informal manner; and

   (b)     without regard to legal forms and technicalities.

   (4)At any stage of the small claims proceedings, the court may amend the papers commencing the proceedings if sufficient notice is given to any party adversely affected by the amendment.

   …”

3. In McShane v Image Bollards Pty Ltd,[1] Lucev FM (as His Honour then was) said of this process:

   [1] McShane v Image Bollards Pty Ltd [2011] FMCA 215

   “Section 548(3) of the FW Act provides as follows:

   5.Procedure

   (3)In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:

   (a)     in an informal manner; and

   (b)     without regard to legal forms and technicalities.

6.Rule 45.11(2) of the FCCA Rules provides as follows:

(2)The Court is not bound by the rules of evidence when dealing with a small claim application, but may inform itself of any matter in any manner as it thinks fit.

7.Although the Court is not bound by the rules of evidence, and may act informally, and without regard to legal forms and technicalities in small claims proceedings in the Fair Work Division, this does not relieve an applicant from the necessity to prove their claim. The Court can only act on evidence having a rational probative force. The necessity to prove the claim was pointed out with particularity to the parties at the directions hearing on 18 March 2011. That particularity was necessary because Mr McShane had described the hearing, which the Court had just ordered be listed for 31 March 2011, as the “next get-together” (or words to that effect). The Court was at pains to point out that it was in fact a hearing at which the claim would need to be proved. Thus, Mr McShane was on notice that he would need to attend the hearing and prove his claim.”[FOOTNOTES OMITTED].

1. I also refer to the decision of Nicholls FM (as His Honour then was) in Black v Young Republic & Anor [2012] FMCA 729 where His Honour noted the provisions in section 548 set out above and the decision in Jones v Groovy Freighters Pty Ltd [2010] FMCA 673 and said:

   “6.Further, Burnett FM noted that (at [10]):

   “... Commonly small claims applications are conducted in the States by their Tribunals rather than courts. They are called upon to determine these disputes in a manner which can be described as somewhat “quick and dirty” to provide flexibility to dispose of such proceedings both informally and cost effectively.”

   7.In McShane v Image Bollards Pty Ltd [2011] FMCA 215, Lucev FM (at [7]) also commented on the nature of small claims proceedings and the exercise of the Court’s judicial power within the proceedings informal structure:

   “Although the Court is not bound by the rules of evidence, and may act informally, and without regard to legal forms and technicalities in small claim proceedings in the Fair Work Division, this does not relive an applicant from the necessity to prove their claim. The Court can only act on evidence having a rational probative force.”

   [Footnote omitted.]

   8.The observations made by Burnett FM and Lucev FM are, in my respectful view, important. While the small claims process allows for the Court to act in an informal manner, without regard to legal forms and technicalities and to not be bound by rules of evidence and procedure (s.548(3)), those allowances must be balanced against the Court’s exercise of its judicial power. That is, the Court can only make a decision where a claim is supported by some probative basis in fact. Further, that decision must be supported by a reasoned judgment that addresses the issues in the case.

   9.In this light, I also have regard to what was said by:

   Federal Magistrate Lucev in Lebot v Energetic IT Pty Ltd [2011] FMCA 755:

   “Small claims jurisdiction – practice and procedure

   [7] Section 548(3) of the FW Act provides as follows:

   ·    Procedure

   ·    (3) In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:

   ·    (a) in an informal manner; and

   ·    (b) without regard to legal forms and technicalities.

   [8] Rule 45.11(2) of the FMCA Rules provides as follows:

   (2)The Court is not bound by any rules of evidence and procedure when dealing with a small claims application and may act:

   ·    (a) in an informal manner; and

   ·    (b) without regard to legal forms and technicalities.

[9]Although the Court is not bound by the rules of evidence, and may act informally and without regard to legal forms and technicalities in small claims proceedings in the Fair Work Division, this does not relieve an applicant from the necessity to prove the claim. The Court can only act on evidence having a rational probative force. For that reason the Court had Mr Lebot give evidence which confirmed the detail of his claim as it appeared in the Form 5 claim form, plus other details which the Court considered it necessary to enquire about.”

1. Rules 13.03A, 13.03B and 13.03C of the Federal Circuit Court Rules2001 (“the Rules”) provide:

   “Rule 13.03A:

   1.For rule 13.03B, an applicant is in default if the applicant fails to:

   (a)comply with an order of the Court in the proceeding; or

   (b)file and serve a document required under these Rules; or

   (c)produce a document as required by Part 14; or

   (d)do any act required to be done by these Rules; or

   (e)prosecute the proceeding with due diligence.

   2.For rule 13.03B, a respondent is in default if the respondent:

   (a)     has not satisfied the applicant's claim; and

   (b)     fails to:

   (i)     give an address for service before the time for the respondent to give an address has expired; or

   (ii)     file a response before the time for the respondent to file a response has expired; or

   (iii)   comply with an order of the Court in the proceeding; or

   (v) file and serve a document required under these Rules; or

   Rule 13.03B

   1.If an applicant is in default, the Court may order that:

   (a)the proceeding be stayed or dismissed as to the whole or any part of the relief claimed by the applicant; or

   (b)a step in the proceeding be taken within the time limited in the order; or

   (c)if the applicant does not take a step in the time mentioned in paragraph (b)--the proceeding be stayed or dismissed, as to the whole or any part of the relief claimed by the applicant.

   (2)If a respondent is in default, the Court may:

   (a)order that a step in the proceeding be taken within the time limited in the order; or

   (b)if the claim against the respondent is for a debt or liquidated damages--grant leave to the applicant to enter judgment against the respondent for:

   (i)     the debt or liquidated damages; and

   (ii)     if appropriate--costs; or

   (c)if the proceeding was commenced by an application supported by a statement of claim or the Court has ordered that the proceeding continue on pleadings--give judgment against the respondent for the relief that:

   (i)     the applicant appears entitled to on the statement of claim; and

   (ii)     the Court is satisfied it has power to grant; or

   (d)give judgment or make any other order against the respondent; or

   (e)make an order mentioned in paragraph (b), (c) or (d) to take effect if the respondent does not take a step ordered by the Court in the proceeding in the time limited in the order.

   (3)The Registrar must enter judgment for the debt or liquidated damages, costs and interest against the respondent as specified in leave granted under paragraph (2)(b), without giving notice, or further notice, to the respondent, if the applicant has filed in the Registry:

   (a)an affidavit, or affidavits, proving:

   (i)     service of the application claiming judgment for the debt or liquidated damages; and

   (ii)     that the respondent is in default; and

   (b)an affidavit for the debt or liquidated damages in accordance with the approved form.

   (4)Unless the Court otherwise orders, if a respondent to a cross-claim is in default:

   (a)a judgment or decision on any claim, question or issue in the proceeding on the originating process; or

   (b)any other cross-claim in the proceeding;

   is binding as between the cross-claimant and the respondent to the cross-claim, to the extent that the judgment or decision is relevant to any claim, question or issue in the proceeding on the cross-claim.

   (5)In subrule (4):

   decision includes a decision by consent.

   Judgment includes a judgment by default or by consent.

   (6)The Court may make an order of the kind mentioned in subrule (1), (2) or (4), or any other order, or may give any directions, and specify any consequences for non-compliance with the order, that the Court thinks just.

   Rule 13.03C

   (1)If a party to a proceeding is absent from a hearing (including a first court date), the Court may do 1 or more of the following:

   (a)     adjourn the hearing to a specific date or generally;

   (b)     order that there is not to be any hearing, unless:

   (i)     the proceeding is again set down for hearing; or

   (ii)     any other steps that the Court directs are taken;

   (c)if the absent party is an applicant--dismiss the application;

   (d)if the absent party is a party who has made an interlocutory application or a cross-claim--dismiss the interlocutory application or cross-claim;

   (e)proceed with the hearing generally or in relation to any claim for relief in the proceeding.

   2.If a party to a proceeding is absent from a hearing, the Court may also make an order of the kind mentioned in subrule 13.03B(1), (2) or (4), or any other order, or may give any directions, and specify any consequences for non-compliance with the order, that the Court thinks just.”

1. The Rules provide the Court with authority to give judgment or to make any other order against the respondents. I am satisfied the respondents have not satisfied the applicant’s claim. The respondents have not filed a notice of address for service, a response, or affidavit as required under the Rules. The respondents have not complied with an order of this Court and having regard to rules 13.03A(2)(a), 13.03A(2)(b)(i), (ii), (iii), (iv) and (vii) the respondents are in default for the purposes of rules 13.03B(2). A combination of rules 13.03B(2), 13.03B(6) and /or 13.03C(1) provides the Court with ample authority to give judgment or make any other order against the respondents.

2. Given the defaults by the respondents and the material that the applicant has filed, I am satisfied pursuant to the relevant sections of the Rules, the details of which I have referred to, that I am able to make orders in the terms sought by the applicant for the amount particularised in the form 5, having regard to the provisions of section 548 of the FW Act on the evidence before the Court.

1. I am satisfied on the balance of probabilities that the applicant has made out his case. I therefore make an order pursuant to section 545 of the FW Act that the respondents pay to the applicant the amount of $4,235.00 gross. I will make an order that the applicant serve the respondents with a copy of the orders made this day within 14 days. I so order.

I certify that the preceding sixteen (16) paragraphs are a true copy of the reasons for judgment of Judge O’Sullivan

Associate: 

Date:  23 July 2014