Anthony John Coulson v Thomas Cook Limited

[1996] IRCA 66

DECISION NO:  66/96

CATCHWORDS

INDUSTRIAL LAW - JUDICIAL REGISTRARS’ POWERS - meaning of s 376(1) of Industrial Relations Act 1988 (Cth) - JUDICIAL REGISTRARS’ POWERS to hear claims for money amounts in excess of $10,000 - meaning of “unwritten law” in s 376(1)(b) of Act

Industrial Relations Act 1988 (Cth): ss170dc, 170de, 170de, 170ea, 170ee, 178, 179, 361, 376, 377, 378, 430.

Federal Court of Australia Act 1976 (Cth): s 32.

Industrial Relations Court Rules: O 74 R 2.

Brackenridge v. Toyota Motor Corporation Australia Limited (Unreported, Beazley J, 14 September 1995, Industrial Relations Court of Australia)

ANTHONY JOHN COULSON v. THOMAS COOK LIMITED

WI 1224 of 1995

CORAM:  MADGWICK J
PLACE:    PERTH

Date of Hearing:     22 FEBRUARY 1996
Date of Judgment: 5 MARCH 1996

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY

No. WI 1224 of 1995

BETWEEN  ANTHONY JOHN COULSON
  Applicant

AND  THOMAS COOK LIMITED
  Respondent

CORAM:  MADGWICK J
PLACE:    PERTH
DATE:     5 MARCH 1995

MINUTES OF ORDER

1. Direct that this case be heard by a Judicial Registrar.

2. Refer the papers to the WA Deputy Registrar for further directions.

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY

No. WI 1224 of 1995

BETWEEN  ANTHONY JOHN COULSON
  Applicant

AND  THOMAS COOK LIMITED
  Respondent

CORAM:  MADGWICK J
PLACE:    PERTH
DATE:     

REASONS FOR JUDGMENT

MADGWICK J:

A question of the Judicial Registrars’ jurisdiction

In this case the applicant alleges that his employment with the respondent, which had lasted for over 20 years, was terminated in contravention of ss 170dc and 170de  of the Act and was accordingly unlawful.  He seeks compensation up to the limit available in his case pursuant to s 170ee of the Act, about $27,000.  He has pursued that claim by “[applying] to the Court for a remedy in respect of termination of his ... employment” under s 170ea.  He also wishes to bring the following claim:

“Claim for Breach of Contract

33.     Mr Coulson was entitled to reasonable notice of termination under his contract of employment.

34.     In all the circumstances of his employment, reasonable notice would be 12 months’ notice.  Mr Coulson was given six weeks’ pay in lieu of notice.

35.     Accordingly Mr Coulson seeks damages pursuant to his contract of employment under the associated jurisdiction of the Court for failure to give reasonable notice of termination under the contract.”

This description of the claim in the associated jurisdiction of the Court is extracted from a “Summary of Facts of Applicant’s Case” filed in accordance with a direction given by the Western Australian Deputy District Registrar of the Court.  In this case, the claim for damages (equal to 46 weeks’ pay less some earnings by the applicant) would well exceed $10,000.  The matter had originally been listed before a Judicial Registrar of the Court who was informed that a claim was to be made in the associated jurisdiction of the Court and in a quantum exceeding $10,000.  In these circumstances, in accordance with a not uncommon practice in this Court since its inception, the matter was regarded as beyond the powers of the Judicial Registrar and arrangements were made to list it before me. 

Because of doubts felt in some quarters about the correctness of that view of jurisdiction, I caused the matter to be listed to hear argument as to why the matter should not be remitted for hearing, as to both of the applicant’s claims, by a Judicial Registrar.  In the event, by consent, the matter proceeded by way of written submissions.

The respondent submits, among other things, that the inclusion of the claim in the associated jurisdiction of the Court merely in a “Summary of Facts of the Applicant’s Case” does not comply with the Rules.  That is probably right but nothing of significance turns on it and I will direct that the statement of facts be treated as a Statement of Claim filed by the applicant and be deemed to comply with the Rules.

The statutory framework

The following provisions of the Act appear to be relevant. 

Section 361(2) provides:

“The Court is a superior court of record and is a court of law and equity”.

Section 376 provides:

“(1)   The Rules of Court may delegate to the Judicial Registrars, either generally or as otherwise provided in the Rules, all or any of the Court's powers in relation to proceedings in the Court, in so far as the proceedings relate to:

(a)   a claim for an amount of not more than the amount specified in the Rules; or

(b)   a claim that the termination of an employee's employment was unlawful, or that the proposed termination of an employee's employment would be unlawful, whether because of this Act or any other law (including an unwritten law) of the Commonwealth or of a State or Territory.

(2)     For the purposes of paragraph (1) (a), the Rules may specify an amount of not more than:

(a)   $10,000; or

(b)   such greater amount as the regulations prescribe.

(3)     Without limiting subsection (1), Rules of Court made because of that subsection:

(a)   may delegate to the Judicial Registrars powers that could be delegated to the Registrar of the Court; and

(b)   may so delegate powers by reference to powers that have been delegated to the Registrar of the Court under section 466.

(4)     A power delegated to the Judicial Registrars is, when exercised by a Judicial Registrar, taken to have been exercised by the Court or a Judge, as the case requires.

(5)     The delegation of a power to the Judicial Registrars does not prevent the exercise of the power by the Court or a Judge.

...

(7)     As well as the powers delegated under subsection (1), the Judicial Registrars have such other powers as are conferred on them by this Act, the regulations or the Rules of Court.”

Section 377 provides:

“(1)   A party to proceedings may apply to the Court to review a Judicial Registrar's exercise in the proceedings of a power delegated under section 376. An application must be made within the period prescribed by the Rules of Court or such further period as is allowed in accordance with the Rules.

(2)     On an application under subsection (1) or of its own motion, the Court may review a Judicial Registrar's exercise of a power so delegated. The Court may make whatever order it considers appropriate in relation to the matter in relation to which the power was exercised.

...”

Section 378 provides:

“(1)   If:

(a)   an application for the exercise of a power delegated under section 376 is to be, or is being, heard by a Judicial Registrar; and

(b)   the Judicial Registrar considers that it is not appropriate for him or her to determine the application; he or she must not hear, or continue to hear, the application, and must instead make appropriate arrangements for the Court to hear the application.

(2)     If a Judicial Registrar proposes to exercise in a particular case a power delegated under section 376 but has not begun to exercise the power in that case, a Judge may order that the power be exercised in that case by a Judge.

(3)     An order under subsection (2) may only be made on application by a person who would be a party to the proceedings before the Judicial Registrar in relation to the proposed exercise of the power.

(4)     If an application is made under subsection (3), the Judicial Registrar must not exercise the power in that case until the application has been determined.”

As to the associated jurisdiction, s 430 subsection (1) provides:

“(1) So far as the Constitution permits, jurisdiction is conferred on the Court in respect of matters not otherwise within its jurisdiction that are associated with matters in which the jurisdiction of the Court is invoked.

In relation to the delegation of power to the Judicial Registrars contemplated by s 376(1), Order 74 Rule 2 of the Rules provides:

“2.     In relation to any proceeding in the Court, in so far as that proceeding relates to:

(a)a claim for an amount of not more than $10,000 or such greater amount as the regulations may from time to time prescribe; or

(b)a claim that the termination of an employee’s employment was unlawful, or that the proposed termination of an employee’s employment would be unlawful, whether because of this Act or any other law (including an unwritten law) of the Commonwealth or of a State or Territory;

all the powers of the Court are delegated to each Judicial Registrar.”

Hence, having regard to the repetition of the language of s 376(1) in O.74 R.2, for practical purposes the question as to whether the Judicial Registrar has power to hear the “claim for breach of contract” outlined above depends upon a proper characterisation of that claim for the purposes of, and the meaning to be accorded to, s 376 of the Act.

Features of s 376

The following may be noticed about section 376.  The section sets up no barrier to Judicial Registrars exercising the Court’s powers in proceedings relating to an unlawful termination claim simply because that claim is accompanied, as here, by a claim for payment of an amount.  Section 170ee(1)(b) contemplates that, if the Court reinstates the employee, the Court may make an order requiring the employer to pay the employee the remuneration lost because of the termination, and there is no upper limit upon such lost remuneration.  More frequently exercised, perhaps, is the Court’s power under s 170ee(2) to order the employer to pay compensation of such amount as the Court thinks appropriate where there is a contravention of the relevant provision of the Act but the Court thinks that the reinstatement of the employee is impracticable.  Subsections 3 and 4 of s 170ee place an upper limit on the amount of compensation that may be ordered under subsection 2.

Further, there is no doubt about the Judicial Registrars’ powers to order reinstatement and, as is not uncommonly put by employers, the importance of the issues may far transcend even very considerable amounts of remuneration lost on account of the termination or other possible compensation.  The indirect costs of a reinstatement may be greater still: for example, where an employee whose employment has been terminated has been replaced by the hiring of another employee, upon the reinstatement of the former, the employer has a problem, including one of financial proportions, with the new employee.

Thus, (a) unlawful termination claims are not relatively unimportant compared with the other work of the Court, (b) nor are remedies in such cases necessarily confined to relief other than the adjudication and assessment of amounts to be paid, and (c) nor is there necessarily any upper limit upon such amounts, except as prescribed by the Act for the Court itself.

“Unwritten law” claims

Paragraph 376(1)(b) allows for power to be delegated and, by the Rule referred to, it has been delegated, to Judicial Registrars:

“... in relation to proceedings in the Court, insofar as the proceedings relate to:

...

(b)     a claim that the termination of employee’s employment was unlawful ... because of this Act or any other law (including an unwritten law) of the Commonwealth or of a State or Territory.” (my emphasis)

Nowhere else in the Act is the Court given a general jurisdiction in relation to all claims of unlawful termination of an employee’s employment, howsoever arising.  If it were thought that termination of employees’ employment which was unlawful because of an unwritten law of the Commonwealth or of a State or Territory would necessarily be “harsh, unjust or unreasonable” (compare s 170de(2)), there would have been no need for the inclusion of the emphasized words just quoted in paragraph 376(1)(b). 

The purpose of the inclusion of those words seems to have been to enable the delegation to Judicial Registrars of the power to hear all unlawful termination claims, however they may arise, so far as unlawful termination is actually the subject of such claims, and without regard to monetary limits.  However, the claim must itself “relate to” a claim of unlawful termination, in the sense that unlawful termination be the subject of the claim.  It seems plain to me that in the words "insofar as the proceedings relate to", their context requires that the narrower of the two relevantly possible meanings of "relate to", ie. "concerns", be implied rather than "have some connection with": see the apt examples in the New Shorter Oxford English Dictionary ("relate", examples 6 and 8.a). Examples not within s 376(1)(b) would be: 1) a claim for short-paid wages during a part of the period of the employment long before the employment was terminated; and 2) a claim for damages in defamation (assuming that under s 430 such a claim could be associated with an unlawful termination claim, so as to vest the Court with jurisdiction in the first place). In relation to claims such as those just instanced, the Judicial Registrars’ ability to deal with them would still be limited by s 376(1)(a).

Section 376(1)(a) therefore indicates an assumption on the part of the legislature that the Court might have jurisdiction in relation to claims of unlawful termination because of unwritten law operating in Australia. Of course the Court very often does have such jurisdiction under s 430, subject to the familiar requirements that such "associated matters", depending upon rights established in such unwritten law, arise out of the same substratum of fact and/or be part of the same justiciable controversy as the federal law matters within the Court’s jurisdiction. The legislature may be taken to have anticipated this. Section 430 was adapted for this Court from the provisions of s 32 of the Federal Court of Australia Act 1976 (Cth). There had been 18 years’ experience of the accrued jurisdiction in the Federal Court, when this Court was established. That experience had amply demonstrated the fecundity of, and the frequency of resort to, the accrued jurisdiction. The legislature may therefore be taken to have anticipated that this Court’s associated jurisdiction would be resorted to in unlawful termination cases, to seek remedies based upon law other than the Act itself, ie. “other law (including an unwritten law) of the Commonwealth or of a State or Territory”, as it is put in s 376(1)(b).

There is no contextual reason nor any other basis in technical rules of interpretation that I can discern for  reading down the conferral of powers upon the Judicial Registrars by taking paragraph (a) of subsection 376(1) as applying to claims for amounts in proceedings where paragraph 376(1)(b) claims of unlawful termination are made - indeed to do so would make a nonsense of paragraph 376(1)(b).  Nor is there any reason for regarding paragraph 376(1)(a) as necessarily implicitly limiting the grant of power in respect of the full range of paragraph 376(1)(b) claims.

The conclusion from the foregoing seems to be inescapable that the Rules have validly delegated to the Judicial Registrars unlimited jurisdiction including jurisdiction for claimed amounts of money provided that “the proceedings relate to ... a claim that the termination of employee’s employment was unlawful ... because of ... an unwritten law [operating in Australia]”.

Broader policy questions

Neither is there any compelling reason for thinking otherwise founded on broader questions of policy that might have concerned the legislature.  On the contrary, to interpret s 376 as I suggest here would be consonant with the following approach, which seems to be rational and defensible.

First, unjust termination of employment claims were likely to be numerous (an assumption which, if the legislature did make it, has been amply borne out in practice) and it is inherently desirable that they be dealt with rapidly (compare s 170ea(3)) and by decision-makers who would soon build up a bank of experience and ability to make broad comparative judgments about harshness, etc.  Hence the need, given constitutional constraints, for Judicial Registrars.  Hence also, the good sense of not limiting their powers in any unlawful termination claim, whether that claim arises under federal law, under common law or under a State or Territory statute or ordinance.

Second, the other principal source of the jurisdiction of the Court to order the payment of money arises under s 178 and s 179, insofar as those sections deal with the recovery of amounts required to be paid by employers under awards or orders of the Industrial Relations Commission. In relation to award underpayment claims, these are (i) quite small and suitable for an informal, though still curial, “small claims” procedure (see s 179c and 179d), or (ii) larger and/or not thought fit by the claimant for a small claims procedure. In such latter cases, the claimant is able to proceed otherwise and either in the Court or any other court of competent jurisdiction. If the matters come to the Court, then the time of the Judges of the Court (and the necessarily additional expense of hearings before them) might be husbanded by channelling those of lower quantum to the Judicial Registrars. If the entire Judicial Registrars’ experiment should turn out successful, then the initial $10,000 limit for such claims might be enlarged to any greater amount as the executive government, through the regulation-making power, might prescribe; hence para (a) of s 376(1) and s 376(2).

I should add that it would have been foreseeable, and it has certainly often turned out to be the case in practice, pursuant to a contrary view of the operation of s 376, that it would occasion considerable inconvenience to the Court that relatively small claims should be referred to Judges of the Court, simply because the claimant has been able to show an arguable case for monetary relief in the associated jurisdiction in excess of $10,000.  Beazley J in Brackenridge v. Toyota Motor Corporation Australia Limited (Unreported, 14 September 1995, Industrial Relations Court of Australia) held that if a claim is not merely colourable, in the sense of being made for the improper purpose of fabricating jurisdiction, and might reasonably possibly result in an award of more than $10,000 then one could not say that it was not, within the meaning of para 376(1)(a), “a claim for an amount of not more than [$10,000]”.  That is the only question, as the matter was presented to Her Honour, with which she needed to deal:  it was simply assumed that, if the matter fell within 376(1)(a), it would necessarily fall without 376(1)(b). The considerations which have moved me to the conclusions to which I have come were evidently not argued before Her Honour.  I may add that, with respect, Her Honour’s approach to the test for the applicability of s 376(1)(a) appears to me to be otherwise clearly correct.

Characterisation of the “breach of contract claim” - a claim of unlawful termination

The “claim for breach of contract” at issue here is also in reality a claim that the employee’s termination was unlawful at common law.  The applicant wishes to say that he relies on the unwritten law of Western Australia and, if it be relevant, of the Commonwealth, to imply a term of reasonable notice into his contract of employment.  The implied term upon which he relies would be stated in this way:  “the employer shall give reasonable notice of termination of employment to the employee”.  A claim that reasonable notice was not so given is therefore necessarily a claim that the termination was unlawful because of the breach of contract.  The remedy for it would be damages assessable in an amount equal to the remuneration for a period of reasonable notice less what the applicant received on account of notice and, perhaps, has earned elsewhere during that period.  That entire conceptualisation of the claim depends on the unwritten law operating in Australia.  Indeed, the very notions that Mr Coulson’s relationship with his former employer should be categorised as “contractual” and that legal effect should be given to that contract are propositions of "unwritten" law. 

Thus, there is no need to rely upon the "associated jurisdiction" under s 430 of the Act to give the court power to hear this claim: it falls directly within s 376(1)(b).

Conclusion

Therefore, it seems to me that the entirety of Mr Coulson’s claims are claims that the termination of his employment was unlawful for one or more of the reasons spelled out in para 376(1)(b).  Accordingly, since in my view para 376(1)(a) in no way limits the power of the Court through the Rules to delegate its powers in relation to those proceedings, the entire case may be heard by a Judicial Registrar.  This is so notwithstanding that there may be an arguable claim for relief involving a claim for an amount of more than $10,000 in the associated jurisdiction, pursuant to which the claim in common, or “unwritten”, law for unlawful termination of employment (constituted, as I have explained, by the claim for breach of contract) is brought.

I certify that this and the preceding 10 pages are a true copy of the Reasons for Judgment of His Honour Justice Madgwick.

Associate:  

Dated:       

APPEARANCES

Counsel for the Applicant:      D H Schapper

Solicitor for the Respondent:   S Boatswain, Dunhill Madden Butler

Date of hearing:  22 February 1996