Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (the Syme Library Case)
[2018] FCA 1142
•1 August 2018
FEDERAL COURT OF AUSTRALIA
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Syme Library Case) [2018] FCA 1142
File number VID 523 of 2014 Judge: TRACEY J Date of judgment: 1 August 2018 Catchwords: INDUSTRIAL LAW – where the Australian Building and Construction Commissioner alleged contraventions of ss 340, 343, 345, 348, 349 and 354 of the Fair Work Act 2009 (Cth) – where the contraventions were alleged against the Construction, Forestry, Mining and Energy Union, its officer, a subcontractor on a building site, and employees of that subcontractor – whether the contraventions have been established – consideration of the liability of the union for the conduct of its officer – consideration of the liability of the subcontractor for the liability of its employees Legislation: Building and Construction Industry Improvement Act 2005 (Cth) s 45
Building Construction Industry (Consequential and Transitional Provisions) Act 2016 (Cth) Sch 2 cl 19
Evidence Act 1995 (Cth) s 140
Fair Work Act 2009 (Cth) ss 12, 340, 343, 345, 348, 349, 354, 363, 546, 550, 570, 793
Federal Court of Australia Act 1976 (Cth) s 21
Federal Court Rules 2011 (Cth) Sch 3 cl 18
Cases cited: Adcock v Blackmores Ltd (2016) 259 IR 209; [2016] FCCA 265
Adcock v Blackmores Ltd [2016] FCA 893
Ashby v Slipper (No 2) (2014) 314 ALR 84; [2014] FCAFC 67
Australian Building and Construction Commissioner v Australian Manufacturing Workers’ Union (The Australian Paper Case) [2017] FCA 167
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] FCA 42
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Abseal Case) (2017) 266 IR 204; [2017] FCA 11
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) [2017] FCA 1398
Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Bay Street Case) [2018] FCA 83
Australian Building and Construction Commissioner v Hall [2018] FCAFC 83
Australian Building and Construction Commissioner v McConnell Dowell Constructors (Aust) Pty Ltd (2012) 203 FCR 345; [2012] FCAFC 93
Australian Building and Construction Commissioner v Upton (The Gorgon Project Case) [2017] FCA 847
Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500; [2012] HCA 32
Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd (2015) 238 FCR 273; [2015] FCAFC 157
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2015) 230 FCR 298; [2015] FCAFC 25
Construction, Forestry, Mining and Energy Union v Clarke (2008) 170 FCR 574; [2008] FCAFC 143
Construction, Forestry, Mining and Energy Union v McCorkell Constructions Pty Ltd (No 2) (2013) 232 IR 290; [2013] FCA 446
Council of Kangan Batman Institute of Technology and Further Education v Australian Industrial Relations Commission (2006) 156 FCR 275; [2006] FCAFC 199
Director Fair Work Building Industry Inspectorate v ADCO Constructions Pty Ltd (No 2) [2016] FCA 1463
Director of the Fair Work Building Industry Inspectorate v McCollough [2016] FCA 1291
Esso Australia Pty Ltd v Australian Workers’ Union (2016) 245 FCR 39; [2016] FCAFC 72
Esso Australia Pty Ltd v Australian Workers’ Union (2017) 350 ALR 404; [2017] HCA 54
Esso Australia Pty Ltd v The Australian Workers’ Union (2015) 253 IR 304; [2015] FCA 758
Geelong Wool Combing Limited v Textile, Clothing and Footwear Union of Australia (2003) 130 FCR 447; [2003] FCA 773
Helal v McConnell Dowell Constructors (Aust) Pty Ltd (No 3) (2011) 285 ALR 281 [2011] FCA 1344
Tattsbet Ltd v Morrow (2015) 233 FCR 46; [2015] FCAFC 62
Victoria v Construction, Forestry, Mining and Energy Union (2013) 218 FCR 172; [2013] FCAFC 160
Yorke v Lucas (1985) 158 CLR 661
Date of hearing: 13, 14, 15, 16 and 17 February 2017 Registry: Victoria Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 520 Counsel for the Applicant: Mr M Felman with Mr A Denton Solicitor for the Applicant: Herbert Smith Freehills Counsel for the First and Second Respondents: Mr R Reitano Solicitor for the First and Second Respondents: Slater and Gordon Lawyers Counsel for the Third to Sixth Respondents: Mr M Rinaldi Solicitor for the Third to Sixth Respondents: Piper Alderman ORDERS
VID 523 of 2014 BETWEEN: AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER
Applicant
AND: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION
First Respondent
THEO THEODOROU
Second Respondent
HARRIS HMC INTERIORS (VIC) PTY LTD (ACN 130 177 164) (and others named in the Schedule)
Third Respondent
JUDGE:
TRACEY J
DATE OF ORDER:
1 AUGUST 2018
THE COURT ORDERS THAT:
1.The further hearing of the application be listed at 10.15 am on 14 August 2018.
2.On or before 12 noon on 7 August 2018 the applicant file and serve any affidavits and an outline of his written submissions relating to penalties and any other relief sought.
3.On or before 5.00 pm on 13 August 2018 the respondents file and serve any affidavits and an outline of their written submissions in response to those of the applicant.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
TRACEY J:
The Australian Building and Construction Commissioner (“the Commissioner”) has alleged various contraventions of the Fair Work Act 2009 (Cth) (“the Act”) by the Construction Forestry, Mining and Energy Union (“the CFMEU”), a CFMEU organiser, Harris HMC Interiors (Vic) Pty Ltd (“Harris Interiors”) and three of Harris Interiors’ employees.
The contraventions are alleged to have occurred in October and November 2013 during the redevelopment of the Kathleen Syme Library and Community Centre (“the Syme Library”) in Carlton, Melbourne (“the Site”). Harris Interiors was engaged to repair and refit the building and construct an extension (“the Project”). Certain demolition works were required.
Harris Interiors engaged a subcontractor, Monark Industries Pty Ltd, which trades as Hughes Demolition, to perform the demolition works. These works began in October 2013.
Hughes Demolition did not have an enterprise agreement. The Commissioner claims that the respondents required it to enter into such an agreement in order to perform the works.
The Commissioner alleges adverse action (s 340), coercion (ss 343 and 348), false or misleading representations (ss 345 and 349) and discrimination (s 354) contrary to the Act.
PARTICIPANTS
The first respondent, the CFMEU, is an industrial association within the meaning of s 12. The second respondent, Mr Theo Theodorou, is an officer and organiser employed by the CFMEU. Mr Shaun Reardon, another CFMEU officer and the Assistant Secretary of the CFMEU Construction Division in Victoria, is also relevant.
The third respondent, Harris Interiors, was the head contractor for the Project. It employed the remaining respondents. Mr Carmelo Silvestro, the fourth respondent, was the Site Manager. The fifth respondent, Mr Shanne Darker, was the Project Manager. The sixth respondent, Mr Jason Dwyer, was the Operations Manager. From time to time, I will refer to the third to sixth respondents as, collectively, “the Harris respondents”. Mr Michael Woods, a witness in the proceeding, was a Contract Administrator for Harris Interiors.
Mr David Seckold was the sole owner and Director of Hughes Demolition. Mr Warwick Dunlop was the Site Foreman for Hughes Demolition and Mr Alex Loft was an Estimator. Other employees include Messrs Grant Prowse, Ashley Wren and Matthew Crew.
Mr Nicholas Smith, an Industrial Relations Adviser from the Master Builders Association of Victoria (“the MBAV”), also had a role to play in the events relevant to this proceeding.
PROCEDURAL BACKGROUND
By an originating application filed on 5 September 2014, the Director of the Fair Work Building Industry Inspectorate sought declarations under s 21 of the Federal Court of Australia Act 1976 (Cth) and penalties under s 546 of the Act. A statement of claim was also filed that day.
The statement of claim alleged that the respondents had contravened the Act in October and November 2013. The CFMEU and Harris Interiors were said to be liable under the common law and ss 363 and 793. The amended statement of claim filed on 2 October 2014 did not materially change the case.
On 17 October 2014 the first and second respondents filed a defence in which they denied the contraventions. An amended defence, filed on 4 May 2015, maintained those denials. In both versions Mr Theodorou claimed the privilege against self-exposure to a civil penalty.
Also on 17 October 2014 the third to sixth respondents filed a defence that responded to the amended statement of claim. Those denials were substantially maintained in the amended defence filed on 13 February 2017.
In both versions of their defence, the third to sixth respondents alleged that Hughes Demolition had, on 24 September 2013 and 1 October 2013, falsely represented to Harris Interiors that it had an enterprise agreement. Harris Interiors said it relied on those representations when entering the contract and that it was unaware there was no agreement until 22 October 2013.
On 7 November 2014 the Commissioner filed a reply to the defence of the third to sixth respondents. He denied that Hughes Demolition had made such a representation.
On 15 December 2016 it was ordered that the Commissioner was to be the applicant: Building Construction Industry (Consequential and Transitional Provisions) Act 2016 (Cth) Sch 2 cl 19.
Following a series of timetabling orders and procedural steps the application was heard over five days from 13 February 2017.
FACTUAL BACKGROUND
The circumstances of the alleged contraventions were, to a large extent, uncontroversial. There were, however, some significant conflicts in the evidence. In the course of outlining the factual background I will identify the conflicting evidence to the extent that it is material.
The meeting on 24 September 2013
Prior to the award of the contract, Harris Interiors held two meetings with Hughes Demolition. The first meeting occurred on 24 September 2013 when Mr Loft of Hughes Demolition met with Messrs Darker, Silvestro and Woods of Harris Interiors.
The subjects discussed at that meeting are disputed. Mr Loft maintained that no questions were asked about an enterprise bargaining agreement (“EBA”) or compliance with any code. Mr Woods did not recall any mention of an EBA, the National Code of Practice (“the Code”) or the CFMEU.
In contrast, Mr Silvestro said that either Mr Woods or Mr Darker had asked Mr Loft if Hughes Demolition was “EBA compliant” and that Mr Loft had said, “We are EBA compliant”. Mr Silvestro’s contemporaneous note records: “Spoke to Alex Loft and asked us to send full documentation. He is EBA compliant.”
Similarly, Mr Darker’s evidence was that either Mr Silvestro or Mr Woods had asked Mr Loft, “Does Hughes Demolition have a compliant agreement?” and that Mr Loft had replied, “Yes”.
These divergent recollections make it difficult to determine whether the question of whether Hughes Demolition had an EBA was discussed at this meeting. What is clear, however, is that, if the issue arose, it was because of a question raised by a representative of Harris Interiors.
The meeting on 1 October 2013
The second meeting was on 1 October 2013 at about 8.00 am. Messrs Seckold and Loft met with Messrs Darker, Silvestro and Woods to review the tender documents and contract. Mr Dwyer was briefly present for part of the meeting. It was common ground that Mr Darker or Mr Silvestro asked Mr Seckold, “Do you have any agreements in place?”
Mr Woods’ evidence was that Mr Seckold was asked, “Are you Code compliant or do you have any agreements in place which Harris should be aware of” and that he had responded, “We have an EBA”. Mr Silvestro said that Mr Seckold had replied that they had “a signed agreement”. Mr Darker’s evidence was that Mr Seckold had replied, “We are compliant”.
Mr Seckold maintained that he had said, “No we don’t have an EBA”, and, “We are compliant with the Code and industry standards and requirements”.
Mr Loft’s evidence was that Mr Darker had asked whether Hughes Demolition had an EBA. He did not recall Mr Darker referring to the Code. Mr Loft said that Mr Seckold responded with words to the effect that, “Hughes works in accordance with building industry standards and EBA requirements”. Mr Loft did not recall Mr Seckold saying that Hughes Demolition was “EBA compliant”.
Again it is difficult to determine precisely what was said. At this meeting the issue of an EBA was raised and it was raised by a representative of Harris Interiors.
Email correspondence
The next day, on 2 October 2013 at 12.55 pm, Mr Silvestro sent an email to Mr Woods of Hughes Demolition setting out a list of the items he wished to ensure were covered off with the contractors for the Project. There was no mention of an EBA.
On 8 October 2013 at 11.04 am, Mr Silvestro sent an email to Hughes Demolition listing a number of missing documents which he required to be submitted to Harris Interiors before it commenced work on the Site. Messrs Darker and Woods were copied to the email. There was no reference to an EBA. The following day, on 9 October 2013, Hughes Demolition sent Mr Silvestro an email attaching some documents.
On 9 October 2013 at 3.18 pm Mr Silvestro emailed Hughes Demolition about a safe work method statement. There was no reference to an EBA. Messrs Darker and Woods were again copied to this email.
On 9 October 2013 at 3.33 pm Mr Woods emailed Hughes Demolition with a copy of the proposed contract. The email requested that a hard copy of an EBA be brought to the Site on the first day of work:
2.Hardcopies will also need to be brought to site on the date of your start; Copies of Site specific – JSAs / SWMS / OH&S Management Plan / Licences / Certificate of Currency for Public Liability – value of $10 million / Work Cover / EBA / Permit to work / Plans / White and Red Cards/MSDS Register.
…
Note: All of the above points need to be fully understood and undertaken prior to starting the works. If you are unsure about any of the above, please give me a call to discuss.
On 10 October 2013 Mr Loft arranged for Hughes Demolition’s demolition method statement to be sent to Mr Silvestro. On 11 October 2013 Mr Silvestro emailed Hughes Demolition to ask for its safety management plan. There was no specific reference to an EBA in any of the exchanges which occurred on these days.
On 17 October 2013 Mr Silvestro emailed Hughes Demolition about “some more items to be updated to get paperwork up to scratch” and said that it “[m]ust have all copies on site by the close of business Friday 17.10.2013.” There was no reference to an EBA.
The commencement of works and the demolition contract
In the meantime, on around 8 or 9 October 2013, Harris Interiors took possession of the Project.
On 10 October 2013, Hughes Demolition commenced work on the Site. An induction meeting was held by Mr Silvestro and attended by Messrs Dunlop, Loft, Darker and Dwyer. There was no discussion of an EBA. During the induction, Hughes Demolition handed over a number of documents in a folder to Mr Silvestro. These documents included some of those requested in the email of 9 October 2013. There was no EBA among those documents. Work then commenced.
The demolition contract was signed by Mr Loft on behalf of Hughes Demolition on 17 October 2013 and by Mr Woods on behalf of Harris Interiors on 18 October 2013. It was not a term of the contract that the employees be covered by an EBA.
The contract did contain terms that: subcontractors were to “observe the provisions of any relevant industrial awards and any Building Industries Agreements current at the time of the execution of the sub-contract works”; that “all works must be fully compliant to current Industrial Standards and Building Codes of Australia”; and that, if Hughes Demolition was unable to perform the contract, Harris Interiors was entitled, after giving written notice, to employ additional labour and deduct those costs from the monies due to Hughes Demolition.
The CFMEU’s presence on the Site in October 2013
Various witnesses gave evidence about Mr Theodorou’s presence on the Site and related interactions with him.
Mr Dwyer’s evidence was that, shortly after Harris Interiors took possession of the Site on 8 and 9 October 2013, he was contacted by Mr Theodorou who indicated that he wished to introduce himself to the Site team and discuss CFMEU requirements.
Mr Silvestro’s evidence was that Mr Theodorou attended the Site sometime in October 2013. He gave his business card to Mr Silvestro and said that he wanted to speak with the “members” working on the Site. He also said that Hughes Demolition did not have an EBA in place.
Mr Darker and Mr Silvestro both gave evidence that, in late October 2013, Mr Silvestro telephoned Mr Darker. Mr Silvestro said, “The union are on site, Hughes doesn’t have an EBA. Have they given you a copy?” Mr Darker replied, “No they haven’t.”
As mentioned, Mr Theodorou did not give evidence. I am prepared to accept that he attended the Site at some point in October 2013 for the purposes of discussing an EBA with Hughes Demolition and Harris Interiors and that he foreshadowed that attendance with Harris Interiors.
The three email requests for the EBA in October 2013
On 22 and 23 October 2013, Mr Darker sent three emails to Mr Seckold requesting that he provide a copy of Hughes Demolition’s EBA.
He sent the first email on 22 October 2013 at 10.30 am to Messrs Seckold and Loft. It stated:
Alex/David
Can you please provide evidence of your EBA / Workplace Agreement to HHMC [Harris Interiors] urgently.
We currently have the Union onsite claiming that you don’t have this in place, this was confirmed [in] pre-tender interviews by Hughes Demolition.
Please call me to discuss and send through all information urgently.
Thanks
He sent the second email to Mr Seckold at 12.24 pm on the same day. Messrs Dwyer, Silvestro and Woods were copied to the email. It stated:
Alex,
As discussed please provide evidence of compliance by 2pm today.
Thanks.
Mr Darker sent the third email on 23 October 2013 at 12.23 pm to Mr Seckold and Mr Loft. Messrs Dwyer, Silvestro and Woods were again copied to the correspondence. It stated:
David / Alex,
Can you please update HHMC [Harris Interiors] to the latest with EBA Agreement.
This whole situation is disappointing considering this was previously confirmed in Pre-award meetings in our office; as [a] consequence this will now cause further increased CFMEU awareness on this project.
Please respond urgently.
The first CFMEU representation on 23 October 2013
At about the same time or shortly after those emails, on 23 October 2013, Mr Seckold had a telephone conversation with Mr Theodorou. Mr Seckold’s evidence was that Mr Theodorou had called him and had said:
As Hughes Demolition is working in the city, it needs to obtain an enterprise agreement with the CFMEU for its employees.
Mr Theodorou denied making this statement.
The second CFMEU representation in late October 2013
In late October 2013, Mr Seckold met with Mr Theodorou and Mr Reardon at the CFMEU offices. Mr Seckold said that, during the meeting, Mr Theodorou or Mr Reardon gave him a copy of an enterprise agreement which they wanted him to sign and said:
You work in the city so you have to have an EBA and you should sign this now.
Mr Theodorou and the CFMEU denied that this meeting occurred, that those words were said, or that a copy of the agreement was provided.
The alleged “threat” by Mr Theodorou on 15 November 2013
Mr Seckold and Mr Theodorou had meetings planned on 14 and 15 November 2013. Mr Seckold did not attend those meetings. He admitted that he did not intend to keep the latter appointment as he did not want to sign an EBA. Mr Seckold understood the purpose of the meeting to be the signing of an EBA acceptable to the CFMEU.
Mr Seckold called Mr Theodorou in the morning of Friday 15 November 2013 to tell him that he would not make it to their meeting that afternoon. At about 3.30 pm on that day, Mr Seckold spoke to Mr Theodorou by telephone. During that conversation Mr Seckold told Mr Theodorou that, “financially I’m not able to sign the enterprise agreement right now”. Mr Seckold’s evidence was that Mr Theodorou said in response:
I’m going to make everything very difficult and not let the boys work on the Site.
Mr Theodorou denied making that statement.
The alleged “threat” by Mr Dwyer on 15 November 2013
At about 5.00 pm on 15 November 2013, Mr Seckold spoke with Mr Dwyer. Mr Seckold’s account was that Mr Dwyer said:
If you don’t sign the EBA with the union, then your boys would not be able to work on the site on Tuesday.
…
[You need to meet with Mr Theodorou to] sort this all out as he has hit the roof.
…
If you don’t sign the enterprise agreement they’re going to get other employees that are covered by an enterprise agreement to finish the job and then charge Hughes Demolition for it.
Mr Dwyer admitted the telephone conversation had taken place but disagreed with what was said. His evidence was that the conversation revolved around the progress of the work on Site and the CFMEU requests for Hughes Demolition’s EBA. He said that it went as follows:
Dwyer:“You guys need to get something worked through with Theo, the frustration is boiling over with the CFMEU. Theo has said if you don't get it signed you guys aren’t going to get to work on Tuesday. You have to find some form of resolution even if it means putting your guys on another site and getting in labour guys to assist. If you can't stick to the program we will get others in. lf you need additional labour we can help you out with that. Would that help?”
Seckold: “It may or may not, send me through the contacts lf you don't want them to work, I need it in writing, otherwise we will start work at 7am on Tuesday in accordance with the contract.”
Dwyer: “Well that instruction will not be coming from me Dave. We want you to work and we want more of your people to come to work. We can't fall any further behind of the program of works and we won't be delayed by the CFMEU. We need to get this back on track. We don't care whether you have an EBA or not we just need to keep going.”
The alleged “threat” by Mr Darker
On 15 November 2013 at 5.23 pm Mr Darker sent Mr Seckold an email. It provided:
David,
As discussed with Jason Dwyer this afternoon.
Please advise by Monday midday with your progress with Theo from CFMEU in relation to signing up to EBA.
If this cannot be achieved then additional sourced of fully compliant labour will required to be sourced by Tuesday onsite, as this project must be kept moving.
If this cannot be sourced we will have no other option but to find the additional labour to contra charge accordingly.
Please call myself or Jason by Midday Monday on an update.
Thanks
The engagement of the Master Builders Association of Victoria
On 18 November 2013 at 3.18 pm, Mr Seckold sent an email to Mr Dwyer outlining the financial impact on Hughes Demolition if it were to sign the EBA and that he would be seeking additional charges of $26,000 plus GST. The email stated “Hughes Demolition will be engaging Master Builders Association of Victoria to facilitate the undertaking of the EBA rates.”
The following day, on 19 November 2013, Mr Dwyer emailed Mr Smith from the MBAV at 11.02 am to ask for something in writing which confirmed that Hughes Demolition had engaged it to facilitate an EBA.
At 11.08 am Mr Smith sent an email to Mr Dwyer which attached a letter on MBAV letterhead which stated: “We wish to advise that Hughes Demolition Pty Ltd has instructed us to act as their authorised bargaining representatives for the purposes of finalising and registering an enterprise agreement (EBA) with their employees.”
At 11.28 am Mr Dwyer forwarded the letter to Mr Darker. The covering email stated: “With a bit of luck this letter attached will resolve our issues.” Mr Darker replied a few minutes later, at 11:34 am, stating, “Hopefully this will close it out”.
Mr Dwyer then sent an email to Mr Theodorou at 11.45 am attaching the letter from the MBAV. His email stated: “I am hopeful that this will now resolve any issues regarding ongoing progress and work on site.”
The work stoppage on 19 November 2013
In the meantime, earlier in the morning on 19 November 2013, a number of Hughes Demolition employees were scheduled to work on the Site at 7.00 am: Messrs Dunlop, Prowse, Wren and Crew. Although they attended the Site, work was delayed for at least a few hours.
At about 6.20 am, Mr Dunlop arrived at the Site and had a conversation with Mr Silvestro. The content of that conversation was disputed. Mr Dunlop’s version was that Mr Silvestro told him the Hughes Demolition employees were unable to start work and that a CFMEU officer would come to talk to them. Mr Silvestro’s version was that Mr Dunlop told him that Mr Seckold had directed the Hughes Demolition employees not to start work.
At about 9.00 am, Mr Theodorou arrived at the Site. He met with the Hughes Demolition employees in a shed on the Site and talked with them for about 10 minutes. Mr Dunlop said that he spoke about the EBA and Hughes Demolition. The topic of conversation was disputed.
Whether Mr Silvestro knew that Mr Theodorou was coming to the Site that morning was in dispute. He maintained that he was unaware that Mr Theodorou was coming that morning. The Commissioner’s case was that Mr Theodorou was involved in, and had advised, encouraged or incited, Mr Silvestro’s conduct that day.
It was common ground that at about 9.00 am that morning Mr Silvestro telephoned Mr Seckold and asked, “What is going on?” or “What’s happening?”. The rest of that conversation was disputed.
It was common ground that work was delayed. There was however, a dispute about when it had recommenced. Mr Dunlop recorded a note that day which said that the work resumed at 10.30 am. At trial he could not recall the timing of many of the events.
The respondents claimed that work was delayed until about 9.00 am or 9.30 am when the Hughes Demolition employees started unloading their tools to start work. Mr Silvestro’s version of events was that he had gone to have a coffee with Mr Darker at about 8.30 am or 9.00 am for about 20 minutes. When they returned at about 9.30 am the Hughes Demolition employees had already recommenced work.
There was also a dispute as to who had directed their return to work. Mr Dunlop said that the direction had come from Mr Silvestro. Mr Silvestro’s evidence was that work had resumed in his absence that morning.
The default on the work programme in November 2013
By at least late November 2013, Hughes Demolition was delayed in its work, at least according to the programme set by Harris Interiors. Hughes Demolition disputed the cause and characterisation of the delay and the existence of a set work programme.
THE NON-CONTENTIOUS AND DISPUTED FACTS
The foregoing summary discloses a measure of agreement about the following matters:
(1)Two meetings were held on 24 September 2013 and 1 October 2013 between representatives of Harris Interiors and Hughes Demolition. The question of whether Hughes Demolition had an EBA was raised during, at least, the second meeting.
(2)On 15 November 2013, Mr Dwyer had a telephone conversation with Mr Seckold in which the progress of works and the CFMEU’s requests for an EBA were discussed. This was the conversation in which Mr Dwyer was alleged to have made his “threat”.
(3)On 15 November 2013, Mr Darker sent Mr Seckold an email that stated that, if an EBA was not signed, other “fully compliant labour” would need to be sourced and that Harris Interiors would “have no other option” but to “contra charge” Hughes Demolition (Mr Darker’s alleged “threat”).
(4)On the morning of 19 November 2013 work on Site was delayed for a period of time.
(5)In November 2013 Hughes Demolition was behind schedule in its works at least according to the programme set by Harris Interiors.
The material facts which remain in dispute are as follows:
(1)Whether, in the meetings in September and October 2013, Hughes Demolition represented that its employees were covered by an enterprise agreement.
(2)Whether, on 23 October 2013, Mr Theodorou said to Mr Seckold that, “as Hughes Demolition is working in the city, it needs to obtain an enterprise agreement with the CFMEU for its employees” (“the first CFMEU representation”).
(3)Whether, in late October 2013, Mr Theodorou or Mr Reardon said to Mr Seckold that, “You work in the city so you have to have an EBA and you should sign this now” (“the second CFMEU representation”).
(4)Whether, on 15 November 2013, Mr Theodorou said to Mr Seckold, “I’m going to make everything very difficult and not let the boys work on the Site” (Mr Theodorou’s alleged “threat”).
(5)Whether, on 15 November 2013, Mr Dwyer said to Mr Seckold: “If you don’t sign the enterprise agreement with the union, then your boys will not be able to work on the site on Tuesday”; that Mr Seckold needed to meet with Mr Theodorou to “sort all this out”; and “If you don’t sign the enterprise agreement they’re going to get other employees that are covered by an enterprise agreement to finish the job and then charge Hughes Demolition for it” (Mr Dwyer’s alleged “threat”).
(6)Whether, on 19 November 2013, the work on Site had been delayed for three and a half hours from 7.00 am to 10.30 am or for a shorter period of time, until about 9.00 am or 9.30 am.
(7)Whether the reason for the delay on 19 November 2013 was because Mr Silvestro prevented the Hughes Demolition employees from performing any work on the Site.
(8)Whether Mr Theodorou advised, encouraged or incited Mr Silvestro to prevent the Hughes Demolition employees from working on the Site on 19 November 2013.
(9)The motivations of the Harris respondents in relation to their alleged threats and actions. In particular, whether they were primarily motivated to avoid delays to the Project or to exert pressure on Hughes Demolition to sign an EBA because it had not done so.
It should be noted that, while some of these disputed allegations were denied in the respondents’ defences, defence counsel at trial indicated that they were not seriously in dispute:
(1)In relation to the two CFMEU representations, the respondents’ counsel did not press a challenge to Mr Seckold’s evidence that the words alleged had been spoken by Mr Theodorou and/or (on the second occasion) by Mr Reardon.
(2)In relation to the alleged “threat” by Mr Theodorou, at trial, counsel accepted that the words had been spoken by him.
(3)In relation to the alleged “threat” by Mr Dwyer, in closing submissions his counsel accepted that the conversation relied upon by the Commissioner had occurred.
EVIDENCE
The Commissioner called four witnesses. The following affidavits were read at trial:
(1)two affidavits of Mr Alex Loft sworn on 13 February 2015 and 30 April 2015.
(2)two affidavits of Mr David Seckold affirmed on 13 February 2015 and 12 June 2015.
(3)one affidavit of Mr Warwick Dunlop affirmed on 28 April 2015.
(4)two affidavits of Mr Nicholas Smith affirmed on 12 February 2015 and 29 April 2015.
A statement of Mr Seckold’s anticipated oral evidence was also filed prior to trial. All four of the Commissioner’s witnesses were required for cross-examination. The parties also relied upon two exhibits which were tendered at trial:
·The Commissioner relied upon Exhibit A1 which was a transcript of a record of an interview conducted by a Fair Work Building Industry Inspector with Mr Seckold on 29 November 2013.
·The Harris respondents relied upon Exhibit R1 which was a statement of Mr Seckold of 12 December 2013 provided to Fair Work Building & Construction.
The CFMEU and Mr Theodorou did not file any affidavits. They did not call any witnesses. Mr Theodorou relied upon the privilege against self-exposure to a civil penalty.
The third to sixth respondents relied upon four witnesses. The following affidavits were read:
(1)one affidavit of Mr Michael Woods affirmed on 16 April 2015.
(2)one affidavit of Mr Shanne Darker affirmed on 16 April 2015.
(3)one affidavit of Mr Jason Dwyer affirmed on 16 April 2015.
(4)two affidavits of Mr Carmelo Silvestro sworn on 16 April 2015 and 12 June 2015.
Messrs Darker, Dwyer and Silvestro were required for cross-examination. The Commissioner’s decision, on the eve of the trial, not to require Mr Woods for cross-examination prompted an application for costs, which is considered at [490]-[519] below.
The evidence at trial is summarised below in the order in which the witnesses were called.
Mr Alex Loft
As mentioned above, Mr Loft was an Estimator employed by Hughes Demolition. The Commissioner called him as a witness. In examination-in-chief Mr Loft adopted both affidavits and the exhibits to the first affidavit. The final sentence in [8] of his first affidavit and [16] of his second affidavit were disallowed on the basis of evidentiary objections.
Mr Loft deposed in his first affidavit in relation to the meeting on 24 September 2013:
Meeting on 24 September 2013
18.On 24 September 2013, I attended a meeting with Mr Woods, Shanne Darker (Project Manager, Harris) (Mr Darker), and Carmelo Silvestro (Site Manager, Harris) (Mr Silvestro) at the Site. I do not recall whether Mr Seckold attended the meeting. I was not asked any questions at this meeting by Mr Woods, Mr Darker or Mr Silvestro about whether Hughes had an enterprise bargaining agreement (EBA), or whether it had an EBA that would be compliant with a “national code of practice”.
…
He maintained this version of the events of 24 September 2013 in his second affidavit. At [6] he denied that either he or Mr Seckold were asked about an EBA.
In relation to the meeting on 1 October 2013, he deposed in his first affidavit as follows:
Meeting on 1 October 2013
22.At approximately 8.00 am on 1 October 2013, I attended a meeting with Mr Woods, Mr Darker and Mr Silvestro from Harris, and Mr Seckold at the Harris’ office in North Melbourne.
23.At the meeting, Mr Woods (predominantly) asked Mr Seckold and I questions about my quotation of the Project. The majority of his questions related to the proposed scope of works, and Hughes’ capacity to do the job, including resourcing (Such as labour and equipment).
24.I recall that at one point, Mr Darker asked Mr Seckold and I whether Hughes had an EBA. I do not recall Mr Darker referring to the “National Code of Practice”.
25.Mr Seckold responded with words to the effect that “Hughes works in accordance with building industry standards and EBA requirements”. Mr Seckold did not say that Hughes was “EBA compliant”.
26.Mr Darker did not respond to Mr Seckold’s answer and moved directly onto the next question. This was the only question asked about having an EBA.
27.There were subsequently a number of further revisions to my quote, in light of changes to the scope of works made by Harris. These were communicated by way of emails
In his second affidavit, he challenged the versions of the meeting of 1 October 2013 given Mr Silvestro and Mr Darker. At [6] he denied that he or Mr Seckold said they had a signed EBA or that “we are compliant”.
His first affidavit recorded his evidence about the requests for documents by Harris Interiors:
Harris’ request for documents
28.On 1 October 2013, Mr Silvestro sent an email to the Hughes email address to my attention (copying in Mr Darker and Mr Woods) which contained a list of documents that would be required to be submitted to Harris “prior to commencing work on site”. There was no reference to an EBA in the email. …
29.On 9 October 2013, I asked for Fiona to send certain documents to Mr Silvestro. …
30.ln response, Mr Silvestro sent a further email to the Hughes email address to my attention(copying Mr Darker and Mr Woods) which stipulated additional requirements regarding the documents to be provided. There was no reference to an EBA in the email. …
31.Mr Woods also sent an email to the Hughes email address to my attention (copying Mr Darker and Mr Silvestro) which attached a copy of a proposed sub-contract agreement and a “Subcontractor pre-start checklist” document. …
32.On 9 October 2013, Fiona Franchi sent me an email from the Hughes email address to my personal email attaching a document prepared by Harris entitled “Special Conditions to subcontract agreement”. The conditions included that “All works must be fully compliant to current industrial Standards and Building Codes of Australia”. There was no reference to an EBA in this document. …
At [33]-[36] he referred to the commencement of work by Hughes Demolition on 10 October 2013 and the email correspondence of 10 and 11 October 2013 about the demolition method statement and safety management plan. He referred to the email of 17 October 2013 from Mr Silvestro and stated that it did not refer to an EBA (at [37]).
He said that he signed the subcontract on behalf of Hughes Demolition on 17 October 2013 (at [38]). He deposed to the emails sent by Mr Darker on 22 and 23 October 2013 which he had received (at [39]-[42]). His affidavit continued:
43.On 23 or 24 October I spoke to Mr Seckold in relation to the emails from Mr Darker, and asked him what was happening. He told me words to the effect: “I have it in hand” and said that he was planning to meet with the union on 24 October, and that he would talk to Mr Darker after that meeting. He told me that he would take care of it and accordingly, I did not need to respond.
44.At some point on either 23 or 24 October, Mr Silvestro of Harris said words to the effect of “How are you going with your EBA?” when I attended the Site. I responded with words to the effect of “Dave’s following up, he'll talk to you about it”.
45.On 24 October 2013, I emailed Fiona Franchi and said I had spoken to David on 23 and 24 October about this, and that he had said: “he will advise Harris in respect to EBA after he has met with the union today”. I sent this email to Fiona because she had forwarded the email Mr Darker sent at 10.32am on 22 October 2013 (referred to at paragraph 39 above) to my personal email address earlier that day, and I wanted to let her know what was happening. …
46.I did not have any subsequent email or telephone contact with Mr Darker (or any other employees of Harris) regarding this issue.
Mr Loft deposed to the events of 19 November 2013 in his first affidavit:
Stop work on Tuesday 19 November 2013
47.I received a call from Mr Dunlop at some point during the morning of Tuesday 19 November 2413. Mr Dunlop said words to the effect: “We’ve been closed down, and we’re sitting in the sheds. The union has stopped us because we don't have an EBA”. I said words to the effect: “Have you brought David across it?” and Mr Dunlop responded “He’s on his way down”. Our conversation ended.
In his second affidavit he disputed the evidence given by the other witnesses. Relevantly, he said:
Phone calls from Mr Darker and Mr Woods
7.I have no recollection of receiving phone calls from Mr Darker as alleged at paragraphs 26 and 30 of the Darker Affidavit.
Allegation about provision of Hughes' EBA
8.I refer to paragraph 36 of the Woods Affidavit. I deny that I ever indicated to Mr Darker that I would send the Hughes EBA to Harris.
Phone calls from Mr Silvestro in late October 2013
9. Paragraphs 40-42 of the Silvestro Affidavit refer to four phone calls that Mr Silvestro allegedly made to me during 28-30 October 2013. I do not specifically recall these conversations. I did have conversations with Silvestro about how many men Hughes would have on site. I disagree that Mr Silvestro or Harris specifically asked Hughes to work on Saturdays or to allocate more labour to the Site during late October 2013.
19 November 2013
10.Paragraph 47 of the Darker Affidavit alleges that Mr Darker tried to call me on 19 November 2013 but that I did not answer my phone. I do not recall having a missed call from Mr Darker on 19 November 2013. I did not receive a message from Mr Darker in my phone message bank on 19 November 2013.
His second affidavit also contained answering evidence to the allegation of the Harris respondents that Hughes Demolition had fallen behind in its “programme of works” for the Project in November 2013: at [11]-[15] and [17]-[22] he denied this was so. He said that Harris Interiors had never provided any written or verbal “programme of works” to Hughes Demolition (at [13]). He accepted that “there were some delays on the Site” but said that these “were not the fault of Hughes” (at [14]).
In his second affidavit he refuted Mr Silvestro’s evidence about a conversation about needing more men:
19.The Silvestro Affidavit specifically alleges at paragaph 46-48 that Mr Silvestro had telephone conversations with me on 8 November 2013 about Hughes needing more staff on site, needing to work Saturdays and about bin organisation, and on 15 November 2013 about Hughes “falling behind the program of works, as well as about sourcing additional labour and working Saturdays’.
20.I have no specific recollection about these conversations. It is possible that Mr Silvestro and I had phone conversations about bin organisation on 8 November 2013.
…
22.I disagree that I would have spoken to Mr Silvestro on 8 and 15 November 2013 about sourcing additional labour or working Saturdays. I do not recall such conversations. If Mr Silvestro had tried to discuss these issues with me, I would have told him immediately to speak to Mr Seckold (since he was responsible for resourcing the Project).
The cross-examination of Mr Loft
In cross-examination by counsel for the Harris respondents, Mr Loft was tested on his recollection of the meeting on 24 September 2013. When asked whether his recollection was not very strong, he said, “Yes and no. I know we went over the scope of work.” He believed that Mr Seckold did not attend. He was challenged on his recollection that no questions were asked about whether Hughes had an enterprise agreement. He maintained that his recollection was not mistaken and that he was not telling an untruth. He disagreed with Mr Silvestro’s evidence that either Mr Woods or Mr Darker asked him (Mr Loft) whether Hughes Demolition was EBA compliant. To the extent that the evidence of Messrs Wood, Silvestro and Darker was different, he maintained that he preferred his recollection.
When it was put to him directly that Mr Silvestro’s evidence was that either Mr Woods or Mr Darker had asked him whether Hughes Demolition was EBA compliant, he stated, “I disagree.” He also disagreed with Mr Silvestro’s evidence that he had said words to the effect of, “We are EBA compliant”. He did not recall that. When asked whether he simply did not recall and that he was “not of a clear recollection that it was not discussed”, he said, “I don’t know”. He later said that there was “no mention” of the EBA in this meeting.
In relation to Mr Silvestro’s note made after the meeting on 24 September 2013 which recorded “Spoke to Alex Loft and asked us to send full documentation. He is EBA Compliant”, he said: “I didn’t say it, full stop.” He said, “I don’t know why he wrote it there because I never mentioned that and it was a later email that requested full documentation.”
He was also asked about the meeting on 1 October 2013. He recalled that, at that meeting, the question of whether Hughes Demolition had an EBA was asked by Mr Darker. Mr Seckold had responded to the question. He agreed that Mr Seckold had indicated that Hughes Demolition worked in accordance with building industry standards and EBA requirements, but that Mr Seckold had not said that Hughes Demolition was EBA compliant. He did not agree that saying that Hughes “works in accordance with EBA requirements” meant the same thing as being “EBA compliant”. He considered that “EBA compliant” meant that an EBA had been signed. Mr Seckold had not said that Hughes Demolition had an EBA but had rather said that they work in accordance with all regulations and standards.
Mr Loft was also cross-examined by counsel for Mr Theodorou and the CFMEU, who asked him about a document which was a copy of the email sent by Mr Woods to the Hughes Demolition’s email address marked to his attention on 9 October 2013. That email stated that “[h]ard copies will also need to be brought to the site on the date of your start” and there was a reference to an “EBA”. Counsel asked him if he recalled reading this document when he received it. Mr Loft replied that he had and that he had no doubt at all about it.
When asked why he had not done as the email instructed and brought a copy of the EBA to the Site, he stated that he did not make the decision not to do so. Rather, “[t]hat was something that David [Seckold] was following up.” Mr Seckold had read the contract, the same as he did, and he said, “Go ahead and sign it”. Mr Loft said that he would have discussed the document with Mr Seckold but could not recall specifically whether the EBA came up.
When asked by counsel whether he understood from reading the document that the EBA was one of the documents he needed to bring to the Site, he said that he could not believe that he missed that. When counsel pointed out that his evidence differed from that in his affidavit at [37] where he had stated, “There was no reference to the EBA in the email”, he stated that he could not recall these points coming up when he prepared his affidavit, even though the email was annexed to his affidavit.
He was also asked about whether he had any understanding at the time of these events why it might be important to Harris Interiors that Hughes Demolition have an enterprise agreement. He replied that he did not. He did not think it was important and nor was he aware of the provisions of the Act which concerned the way in which it worked, including in relation to protected industrial action.
Mr Loft was not cross-examined about his evidence of the events of 19 November 2013.
He was not re-examined.
Mr David Seckold
Mr Seckold was the Director of Hughes Demolition. He was called as a witness by the Commissioner. He adopted his two affidavits in examination-in-chief. Paragraph [13] of his first affidavit was not read. Part of [39] and the whole of [103] of his first affidavit were disallowed due to evidentiary objections. There were no evidentiary objections to his second affidavit.
Speaking of the meeting on 1 October 2013, Mr Seckold deposed as follows in his first affidavit:
Meetings prior to Hughes commencing the work
15.On 1 October 2013, Mr Loft and I had a meeting with Harris in their offices in North Melbourne to review the tender documents and the proposed contract. Harris had a number of representatives at this meeting — Shanne Darker (Mr Darker) (the Project Manager), Carmelo Silvestro (Mr Silvestro) (the Site Manager), Jason Dwyer (Mr Dwyer) (the Operations Manager) and Michael Woods (Mr Woods) (the Contract Administrator and Project Co-ordinator). This was the first time I had met any of these representatives from Harris in relation to the Project.
16.Mr Loft had been estimating the job and was the one corresponding with Harris prior to the 1 October meeting. I attended the meeting because it had come to the point where Harris was going to allocate the job to a demolition company. Mr Loft was generally answering the questions in the meeting.
17.During this meeting Harris had a list of items they wanted to check off with Hughes. The list contained around 10 to 15 points, some of which took around 10 minutes to discuss. I was not given a copy of this list. I cannot recall all the points on the list but it was basically a run through of the scope of works and the job generally. There was a question on the list about an EBA.
18.Mr Loft and I were asked by someone from Harris (I do not recall who) if Hughes had an EBA. I do not remember whether Mr Loft responded, but the representatives from Harris then looked at me. I said words to the effect: “No we don’t have an EBA”. To the best of my recollection I then said words to the effect: “We are compliant with the Code and industry standards and requirements”. I did not say that Hughes was “EBA compliant”.
19.The representatives from Harris did not ask any follow up questions in relation to an EBA. They did not ask whether Hughes had an EBA that would be compliant with the National Code of Practice. We moved straight to the next topic. This was in contrast to other (non-EBA) questions that were asked in the meeting, in respect of which Harris asked follow up questions to Mr Loft and l. Hughes was not asked in this meeting for a copy of or any proof that we had an EBA.
In relation to the first and second CFMEU representations, he said in his first affidavit:
CFMEU demand for an EBA
36.Sometime after receiving these emails from Mr Darker [on 22 and 23 October 2013], I was contacted by Theo Theodorou (Mr Theodorou) from the CFMEU by telephone. I do not remember what date Mr Theodorou contacted me. Mr Theodorou said to me words to the effect that “because Hughes was working in the city, you need to obtain a CFMEU EBA for your employees”. He asked me to come in for a meeting with him at the CFMEU offices on Swanston Street in the city.
37.I agreed to attend the meeting so that I could find out what was going on in relation to Harris' request for an EBA, and because I wanted to diffuse the situation where the CFMEU and Harris were both putting pressure on me about an EBA.
38.The meeting took place at the CFMEU office in late October 2013. The meeting was attended by me, Mr Theodorou, and Shaun Reardon (Mr Reardon) from the CFMEU and went for approximately 45 minutes. I knew Mr Theodorou and Mr Reardon's full names, and that they were CFMEU employees, because they provided me with their business cards in this meeting. …
39.During my meeting with Mr Theodorou and Mr Reardon, Mr Reardon did a lot of the talking. He said words to the effect: “You work in the city so you have to have an EBA and you should sign this now”. … Mr Theodorou also said that I needed to sign the EBA. I said: “I am not signing anything now and I at least need a copy of the EBA”. Either Mr Theodorou or Mr Reardon (l do not remember who) gave me a copy of the EBA they wanted me to sign. Mr Theodorou explained the basics of the EBA in relation to employees' entitlements, such as a 36 hour week, the pay rates, RDOs, and CBUS, Incolink, and Co-Invest entitlements. Mr Theodorou did not explain anything about an employer's responsibilties under the EBA (such as the CFMEU being able to come in at any time to look at your books and check your payments to employees). He did not explain to me the process for making an EBA with employees.
In examination-in-chief he was asked about the words “You work in the city so you should have an EBA and you should sign his now”:
And what tone did he use when he said that to you? --- I believe that it was – he was – say – he was using his authority to get his point across.
And in what way do you think he was doing that, Mr Seckold? --- In – just in the way that his actions were, the way that he was talking.
And how did that make you feel abou the words that were being said to you … --- I felt it didn’t give me any other options at the time. I was trapped in the sense that I had to – you know, had to do it there and then and I wasn’t – that wasn’t what I wanted to do.
His affidavit continued:
40.The EBA was a very large document, about 78 pages. I asked Mr Theodorou to leave it with me as I needed an opportunity to read it. I informed Mr Theodorou and Mr Reardon that I was not going to sign it that day because I needed to know what impact it would have on my business and I needed my accountant to look at it. I told Mr Theodorou I would get back to him. I did not tell Mr Theodorou or Mr Reardon that I was going to sign the EBA they had provided me with. I cannot recall what Mr Theodorou and Mr Reardon said in response.
41.Following the meeting, I sent the EBA to my accountant so that I could get some idea of the impact it would have on my business, including in relation to the Project, if Hughes signed up to the EBA. My accountant rang me a few times over the following days and we read through sections of the EBA together. The rates of pay in the CFMEU EBA were higher than the rates I was paying Hughes’ employees. I was extremely concerned about the impact that signing an EBA would have on my business, because I knew that Mr Loft had quoted for the Project using the rates of pay my employees were currently receiving (which were at or above Award rates), and I worried about the cost of the additional wages. In addition, all of Hughes' other jobs had been quoted for on the basis of paying employees their current rates of pay, not the EBA rates and entitlements.
42.Following my meeting with the CFMEU in later October every time I went on Site, as soon as Mr Silvestro saw me, he would ask me how I was going with the union and whether I had signed the EBA. He would ask: “Oh how ya going with the union? What's happening?”. Further, Mr Dwyer called me every couple of days to check up on what was going on with the EBA. I felt a lot of pressure during this time to sign the EBA.
43.I also felt a lot of pressure from Mr Theodorou to sign the EBA during this time. Mr Theodorou would ring me repeatedly during working hours and I wouldn't answer, and then I might ring him back later. I had saved Mr Theodorou's number in my phone under his name so I would know when he was calling me. In this manner, Mr Theodorou and I would talk probably twice a week on the phone, and during these conversations Mr Theodorou would ask me when the EBA was going to be finalised and ask: “How’s it going? What's happening?” He said on one occasion: “Look, we're letting you work in the city, you've got to get this issue sorted out.”
44.Neither Mr Theodorou, Mr Silvestro or Mr Dwyer ever asked me what I thought about signing the EBA. They just said that Hughes needed to get an EBA.
45.At this stage, if it hadn't been for the requests and demands made on me by the CFMEU on one side, and Harris on the other, I never would have considered signing an EBA for Hughes. After working through the impact the EBA would have on the Kathleen Syme Project, my accountant told me that signing the EBA would add approximately $26,000 to the job (which was quoted for just $105,730 (plus GST) in total). The additional cost was mostly because we did not pay the hourly rate that the EBA would have required us to pay. Our foreman (Mr Dunlop) was paid at just below the EBA rates. The other four Hughes’ employees working on the job were paid above the Award rate, with some of them receiving about $33 an hour. However, these employees still did not receive the same hourly rates as under the EBA, or the other benefits provided for in the EBA - for example, the redundancy contribution. Once I knew the additional cost involved, it was clear to me that the EBA was never going to work for Hughes, because the quote for the Project (including labour) was prepared on a very tight margin.
46.During one of my phone calls with Mr Theodorou in or around late October 2013, Mr Theodorou gave me a deadline by which I was supposed to sign the EBA, which was Thursday 14 November 2013. He told me to meet him on 14 November 2013 at the CFMEU offices.
47.At 4.00pm on 14 November 2013, I called Mr Theodorou and told him that I wouldn't be able to make the meeting as I was tied up. I did not want to tell him that I was not going to sign the EBA, because I did not know how he would react and I was concerned about possible implications on the Project for Hughes. He asked me when I could come in to sign the EBA. I told him I would come in to the CFMEU office in the city the next day, Friday 15 November 2013. However, I did not intend to actually attend this meeting. I just said this so I did not have to continue speaking with Mr Theodorou.
His evidence about Mr Theodorou’s alleged “threat” was as follows:
Friday 15 November 2013: telephone conversations with Mr Theodorou
48.On Friday, 15 November 2013, I telephoned Mr Theodorou around 8.30 am and told him that I would struggle to make our meeting that day, but there was nothing I could do. Mr Theodorou responded by saying words to the effect of: “You were supposed to come in on Thursday [14 November 2013] [need to explain why call made] and sign the EBA. Now it's Friday [15 November 2013] and you still haven't signed it.” I do not recall what I said in response. The conversation ended.
49.Around 12.30 pm on 15 November 2013, Mr Theodorou called me and asked me when I would be coming in. I told him that I was struggling with the decision as implementing the EBA would not work out well for Hughes. I do not remember exactly what Mr Theodorou's response was, but he was annoyed and said words to the effect of “you've wasted my time”. I said I would speak to him later and the conversation ended.
…
57.Mr Theodorou rang me repeatedly between 12.30 pm and 3.15 pm later that day. I did not answer. At around 3.30 pm I called Mr Theodorou and he did not answer. However, shortly after this, Mr Theodorou returned my call. The conversation was heated and went as follows:
a.I said: “l am not in a position to sign the EBA at the moment.”
b.Mr Theodorou said: “You are making it hard for me; saying you would come in to sign and then not coming in.”
c.I said: “You are the one making it difficult. I'm trying to work through this the best that I can. It's a big impact on my business. lf I've signed the EBA then I need to be compensated because I don't see why I should be out of pocket - I didn't quote on the EBA rate”.
d.Mr Theodorou said: “Once you sign the EBA, I will then be in a position where we could go to Harris and speak to them about compensation.”
e.I said: “Financially, I’m not able to sign the EBA right now.”
f.Mr Theodorou said: “l am going to make everything very difficult and not let the boys work on the Site”
g.I said: “I’ve had enough of all this and I am doing my best.”
58. I hung up on Mr Theodorou at this point in the conversation.
At [51]-[55] he referred to calling the MBAV and asking Mr Smith for advice.
He gave the following evidence about Mr Dwyer’s alleged “threat” on 15 November 2013:
59.After my conversation with Mr Theodorou, Mr Dwyer called me shortly after.
60.Mr Dwyer said to me words to the effect: “If you don't sign the EBA with the union, then your boys would not be able to work on the Site on Tuesday. You need to meet up with Mr Theodorou to sort this all out as he has ‘hit the roof'.’” Mr Dwyer then said that if Hughes did not sign the EBA by the next Monday (which was scheduled as a rostered day off), Harris was going to get other employees covered by an EBA to finish the job and then charge Hughes for it.
61.I said to Mr Dwyer: “lf you don't want my boys there on the Tuesday, then you will have to provide me with something in writing saying that they are not required to work. lf I don't receive anything from Harris I will send my boys to start work on Tuesday at 7.00 am in accordance with our contract.” I did not receive anything in writing from Mr Dwyer.
62.I felt as though Mr Dwyer was giving me no choice but to sign the EBA so that Hughes could finish the job.
In his affidavit, Mr Seckold disputed Mr Dwyer’s version of events:
63.Sub-paragraphs 43(b)(1)-(2) of the Defence of the Third to Sixth Respondents dated 17 October 2014 (Defence) allege that Mr Dwyer said words to me during the telephone conversation referred to above to the effect that:
a.‘Theodorou considered Seckold had been avoiding meetings with him and appeared frustrated with a lack of progress by Hughes Demolition in its enterprise negotiations’;
b.‘Hughes Demolition should deal with its enterprise agreement negotiations with [the CFMEU] in a way that would not affect the site programme of works even if this meant moving its employees to work on another site and bringing in labour hire.’
Mr Dwyer did not say either of these things, or any words to this effect, during our conversation on 15 November 2013.
64.Sub-paragraphs 43(b)(3)-(4) of the Defence further allege that Mr Dwyer said words to me during our conversation on 15 November 2013 to the effect that:
a.‘Hughes Demolition was already behind in its programme of works and [Mr Dwyer] could identify other labour hire providers for Hughes Demolition to rectify this’; and
b.‘lf Hughes Demolition failed to keep to the programme of works [Harris] could obtain other labour to complete the Works and back charge Hughes Demolition under the Demolition Contract.’
Mr Dwyer did not say any words to this effect during our call on 15 November 2013.
65.It is possible that I had a conversation with Mr Dwyer at another time, in which he said words to the effect of those set out in paragraph 64 above.
66.Sub-paragraph 43(c) of the Defence alleges that during my conversation on 15 November 2013 with Mr Dwyer in response to my comment that ‘if you don't want my employees to work next Tuesday then you need to provide something in writing’ he said:
a.words to the effect 'you are not going to get that instruction from me - you have to attend for work and keep to the programme of works under your contract'; and
b.‘[Harris Interiors] at all relevant times required Hughes Demolition to attend for and complete scheduled works including on 19 November 2013.’
Mr Dwyer did not say these words, or any words to this effect, during our conversation.
At [67] he referred to calling Mr Smith and telling him about the conversation with Mr Dwyer. Mr Smith said that Harris Interiors cannot prevent Hughes Demolition from working on the Site because it did not have an EBA,
His evidence about Mr Darker’s “threat” of 15 November 2013 was as follows:
69.At 5.32 pm later that day, Mr Darker sent an email to the Hughes email address addressed to me requesting an update by “Monday midday” (being 18 November 2013) on my progress with Mr Theodorou and signing up to an EBA. His email also stated: “If this cannot be achieved then additional sourced or fully compliant labour will be required to be sourced by Tuesday onsite, as this project must be kept moving”. I did not respond to Mr Darker’s email. …
At [73] he referred to sending an email to Mr Dwyer outlining the financial impact upon Hughes Demolition if it were to sign the EBA and that it had engaged the MBAV to negotiate. At [74] he referred to a conversation he had had with Mr Dwyer about that email in which he said Mr Dwyer got angry about his intimation that he would need more money. At [75] he deposed to a conversation he had with Mr Smith from the MBAV after sending the email. At [77] he denied that Hughes Demolition had ever negotiated with the CFMEU:
77.Paragraph 44A of the Defence alleges that on 18 November 2A13 Hughes ceased to undertake enterprise agreement negotiations with the CFMEU directly and appointed MBAV as its bargaining representative. I deny that Hughes Demolition was ever negotiating with the CFMEU in relation to an enterprise agreement. Though some aspects of the CFMEU EBA were explained to me during the meeting I had with Mr Theodorou and Mr Reardon in late October 2A13, as described above, I did not have any discussions or negotiations with the CFMEU about the contents of the EBA, or specific provisions or parts of the EBA.
His evidence as to the events of 19 November 2013 was as follows:
Tuesday 19 November 2013: Hughes’ employees are prevented from working on the Site
78.On Tuesday 19 November 2013 around 6:50 am, I received a call from my foreman, Mr Dunlop, who was on the Site. Mr Dunlop said “What's going on, I have been told by Mr Silvestro that we are not allowed to unload the ute or start work this morning. Mr Silvestro told me that he was waiting for a phone call.” Mr Dunlop sounded very surprised about what was going on. Mr Dunlop and Hughes employees would usually unload tools (those that did not remain on the Site overnight) from the ute in the morning. I said to Mr Dunlop: “Stay on the Site and I will be back in touch with you and the boys once I have made some enquiries.”
79.…
80.At around 8.00 am, I spoke with Mr Dunlop again. I do not remember who called who. Mr Dunlop said: “Me and the boys are sitting in the lunch sheds”. I said: “Sit tight for now and whatever you do, don't leave the Site, I don't want anyone going home, I don't care what Mr Silvestro or anyone else says, I don't want you to leave the site. Make sure that no one leave”.
81.…
82.At around 8.40 am, I spoke with Mr Dunlop again. I do not remember who called who. Mr Dunlop said: “There is nothing else happening and we are still sitting in the lunch sheds”. I said: “Good, bear with me, I am still making some enquiries to see where we are at and I will be in touch with you”.
83.At around 9.00 am, I received a call from Mr Silvestro. Mr Silvestro said: “What's happening?” I said “I am not sure what's happening, the blokes aren't allowed to work, you have stopped them from working”. Mr Silvestro said: “You need to speak to Mr Theodorou from the union”. I said: “l don't need to speak to Mr Theodorou and I have no intention of speaking with Mr Theodorou”. Mr Silvestro said: “You need to sort out what’s happening with the union”. I said: “You are acting illegally”. I do not remember whether anything else was said. The conversation then ended.
84.Just after my conversation with Mr Silvestro, I spoke with Mr Dunlop again. I cannot remember who called who. Mr Dunlop said: “Me and the boys are still sitting in the lunch sheds playing board games”. I said: “Just sit tight, I know you are probably getting a bit anxious but just sit tight and I am on it and doing what I can”.
85.…
86.To the best of my recollection, Mr Dwyer rang me at some point before my guys went back to work on Tuesday, 19 November 2013. During our conversation, I said: “Mate, you know you're in breach of the construction industry regulations.” I said this because, based on the information I had received from Mr Smith of MBA, I knew that it was against the law for the Hughes employees to be prevented from working. However, I do not recollect anything else about our call.
87.At around 10.15 am, I received a call from Mr Smith of MBA to say that he had spoken with Mr Dwyer from Harris earlier that day. Mr Smith said: “l have given them the same information and literature that I provided to you”. I told Mr Smith what had happened on the Site that morning and I confirmed that I had contacted FWBC. Mr Smith said: “You can contact me if you have any further questions”.
88.Shortly after the call from Mr Smith, I received a phone call from Mr Dunlop and he said it was “game on” and the boys were allowed to go back to work on the Site. I am not aware of who had told Mr Dunlop that the Hughes employees could go back to work. I said to Mr Dunlop that the FWBC were on their way down. Mr Dunlop did not say anything about what had happened or why they were allowed back to work.
89.I did not attend the Site on Tuesday, 19 November 2013 at any stage, and I did not receive any contact from Mr Theodorou, or any further contact from any employee of Harris that day.
90.I did not make file notes about any of my conversations during the day, or about anything that happened on the day.
91.I received a copy of the one page report headed ‘Tool Box Meeting’ in relation to the tool box meeting held by Mr Dunlop on the Site on 19 November 2013. Hughes uses tool box meeting reports mostly for OH&S purposes, and to ensure that we have records of what has been discussed during the tool box meetings. My understanding is that Mr Dunlop would complete this report each day about the tool box meeting that had been held that morning, using the template document provided by Hughes. Each 'Tool Box Meeting' report was dated and noted the name of the site, the name of the person who conducted the meeting, and noted other issues about the day's work such as delays, deliveries, and safety issues. In the ‘Tool Box Meeting’ report for 19 November 2013, under the heading ‘Agreed actions’, Mr Dunlop has written: “STOPPED by union problems about EBI Camilio informed don't start work until told otherwise. Union rep came spoke to us explained what is happening. Camilio told us able to start work 10.30”. …
92.I have also seen the Daily Job Report for the Site for 19 November 2013, which was completed and signed by Mr Dunlop. Mr Dunlop, as Site Foreman, would complete a Daily Job Report each day using a template provided by Hughes. Hughes has its Site Foreman on any job fill out a Daily Job Report each day that Hughes is on site to record the important things that have happened that day, and to make sure that if we need to know something that happened on site down the track, we can refer to the Daily Job Report. The report had space for important details about the day's work to be recorded, such as details about the site, date, weather, start time and finish times for Hughes, employees who had worked for Hughes that day, machinery used and equipment hired. There is also space for comments at the bottom of the report. Under the comments heading of the Daily Job Report for 19 November 2013, Mr Dunlop has written: “No work shut down by union problems about E.B.A. Camilio informed us not to start work until told otherwise. Union rep came down explained what is happening. Camilio told us able to start work 10.30”. ...
At [93] he deposed to the effect of the work stoppages on Hughes Demolition:
93.The impact of Hughes’ employees being required to stop work during the morning of Tuesday, 19 November 2013 is that Hughes lost around four hours of work per employee on the Site. Normally the employees arrive on Site at 6.30-6.40am and then get their tools out and start work at 7.00am. However, at 10.30am on 19 November 2013, my employees still had to then go and get their tools (both the tools that had stayed on Site overnight, and the more expensive tools that had to be unloaded from the ute) before they could commence work. I know this because the Hughes employees told me later on what had happened. This meant they started working at about 10.50am and amounts to just under four hours of lost time per Hughes employee. Losing the first four hours of the day for Hughes meant that we lost our most productive time of the day (which is the morning), so in practice amounted to more than half a day of lost work. lt meant that the work we were scheduled to carry out that day on Site could not be completed, which pushed out our other scheduled work. This impacts Hughes financially, because we had quoted for the job on the basis of a very tight profit margin, and any additional days that the Hughes' employees need to spend on Site is a cost that Hughes needs to cover.
His evidence on the aftermath of the work stoppage was as follows:
Wednesday, 20 November 2013
97.At some stage during the morning of Wednesday, 20 November 2013, Mr Dwyer called me on the telephone. Mr Dwyer said that Harris was unhappy that it was being investigated. He did not say by who. I said to him: “I feel like I was put into a position that no one should be put into and that's what has triggered all of this”. I said: “You and Theo Theodorou tried to bully me into a position where I had no other options and I sourced other information which put me in a different position”. I do not remember whether, or how, Mr Dwyer responded to this allegation.
98.Mr Dwyer then said “I am not happy with the circumstances and the fact this is now an issue”. I said to Mr Dwyer: “I will be very disappointed if the wrong person gets the blame for this all happening such as Mr Silvestro”. Mr Dwyer did not acknowledge that the stop work was his fault, or anyone's in particular, however I recollect that either Mr Dwyer or I said that the incident the day before “wasn't handled in the best way” and the other person agreed.
99.During our conversation, Mr Dwyer did not ask about the status of Hughes’ EBA at all, or whether the CFMEU had contacted us.
He gave the following evidence about a conversation which he had with Mr Silvestro the day after the work stoppage:
100.At about 10.30-11am on Wednesday, 20 November 2013, after my conversation with Mr Dwyer, I had a discussion with Mr Silvestro on the Site as he requested to speak with me in his office. Mr Silvestro said words to the effect that I was “implicating him”. He was very angry. I said: “But it was you, you did it, maybe you didn't make the decision but it was you who told the boys to stop work”. He said: “I didn't tell them that they [meaning Hughes' employees l couldn't work here”. I said: “Well who told them?" Mr Silvestro said: 'Well I didn't tell them". I said: "If you didn't tell them who told them?" Mr Silvestro said: "l didn't say they couldn't work, l just told them that I was waiting for a call".
101.I said: Carmelo [Mr Silvestro], facts are facts, if the instruction to have Hughes' employees stop work came from someone else don't blame me for it. Blame your bosses for it because at the end of the day I'm not the one that told you to tell the blokes to stop".
102.Our conversation was heated and Mr Silvestro appeared to almost be in tears. Mr Silvestro said that he would sue and take legal action, and that Mr Dunlop had told the Hughes employees to sit in the sheds. I said to Mr Silvestro that Mr Dunlop might have said “sit in the sheds” but that he did not say the Hughes employees could not work on the Site.
At [104] he deposed that he had no contact from Mr Theodorou or the CFMEU after 20 November 2013. Hughes Demolition left the Site permanently in January 2014 (at [105]).
In his reply affidavit Mr Seckold largely reiterated his evidence above and denied the contrary versions of events appearing in the other affidavits. Speaking of his telephone conversation with Mr Theodorou in October 2013 in which Mr Theodorou said, “because Hughes was working in the city, you need to obtain a CFMEU EBA for your employees”, he said:
5.I relied on the truth of Mr Theodorou's statement during our phone conversation and took what he said to me seriously for the reasons set out below.
6.Prior to Mr Theodorou's statement to me, I had never had a representative from the CFMEU personally ring me and inform me that Hughes needed to obtain an EBA, or ask that I attend a meeting at the CFMEU offices in the city. I had previously been told by my workers that the CFMEU had made similar comments to them at a job in Ascot Vale. Also, a CFMEU official (I do not recall who) had said something similar to me in person at a site in Footscray. The work Hughes had performed prior to the Project was never as close to the city as Carlton.
7.I knew Mr Theodorou was from the CFMEU and so assumed that he knew about the requirements for EBAs, including when and in what circumstances Hughes would need to have a CFMEU EBA. Mr Theodorou spoke with authority during the call and it was clear to me that he was not joking about what he was saying. I took Mr Theodorou at his word when he said that Hughes would be required to have a CFMEU EBA to continue work in the city.
8.I have never negotiated an EBA before. I am a member of, and have been on the board of the Demolition Association, for approximately three to four years. However, this was not an industrial position and I had never had any training on how to handle EBA issues, prior to speaking with the MBA on 15 November 2013 about the issue.
He also deposed, in his reply affidavit, that Hughes Demolition had not fallen behind in its programme of works.
The cross-examination of Mr Seckold
In relation to the meeting of 1 October 2013, he admitted that he did not have a good recollection of it. He did not recall using the word “Code” during the meeting.
In relation to the first day of work on the Site, on 10 October 2013, he confirmed that, after handing over the folder of documents, which did not contain an EBA, Hughes was allowed to start work.
In relation to the two alleged CFMEU representations he admitted that he knew that the officers were from that union and that the union was an employee organisation which looked after its members. He agreed that they wanted him to sign a “CFMEU EBA”. He said that he did not rely on the representations.
He admitted that he spoke to Mr Silvestro about three or four times in October and November 2013 about the progress of his attempts to arrange an EBA. He had told Mr Silvestro that he had spoken to the union and about Mr Silvestro’s desire for the Project to proceed and not be disrupted.
Mr Seckold agreed that, by late November 2013, Hughes Demolition was about two weeks behind where the work should have been according to the program set by Harris Interiors. He could not say exactly how long the delay was but he agreed that nobody was disputing the fact that there was a delay. He agreed that a reason for the delay, suggested by Harris Interiors, was that Hughes Demolition had not provided adequate staff to undertake the demolition works, at least in accordance with Harris Interiors’ programme.
He first confirmed that Mr Dwyer had not provided him with anything in writing about Hughes Demolition’s employees not working on 19 November 2013. He later stated that he “actually believe[d] that ... there is an email that was sent from Harris”. He accepted that there was nothing else in writing apart from the purported email which was not produced.
Mr Seckold accepted that he had an incomplete memory of his conversation with Mr Dwyer on 15 November 2013. He agreed that his affidavit at [61] and Mr Dwyer’s affidavit at [29] refer to his requirement that any direction from Hughes Demolition not to work on 19 November 2013 had to be in writing.
It was put to him that that he had instructed his employees not to start work on the morning of 19 November 2013. This was denied. He accepted that, despite his impression that Harris Interiors might prevent Hughes Demolition from working on site, nobody from Harris Interiors ever told him that they could not work on site if they did not have an EBA. In re-examination, however, he reiterated that his memory of his conversation with Mr Dwyer on 15 November 2013 was correct and that Mr Dwyer had said to him that Hughes Demolition would not be allowed to work on the following Tuesday if there was not an agreement in place.
He agreed that he was unhappy at being charged for the extra labour that was ultimately to be used to finish the job on the Site.
Mr Warwick Dunlop
Mr Dunlop was another of the Commissioner’s witnesses. He was the Site Foreman for Hughes Demolition. In examination-in-chief, Mr Dunlop adopted his affidavit and its two exhibits without any evidentiary objections.
Mr Dunlop gave evidence about his practice of conducting a tool box meeting every morning with the Hughes Demolition employees at the project Site. Mr Silvestro normally attended such meetings as did some occupational health and safety representatives employed by Harris Interiors.
He said that there was a morning tea break at the Site every day which occurred at about 9.30 am.
Prior to 19 November 2013 Mr Dunlop was generally aware, as a result of things told to him by Messrs Seckold and Silvestro, that Mr Seckold was holding discussions with the CFMEU relating to an enterprise bargaining agreement. He was not, however, privy to the detail of those discussions.
He then deposed as to the events of 19 November 2013:
Tuesday, 19 November 2013
12.The Hughes employees working on the Site on 19 November 2013 were Matt Crew, Grant Prowse, Ashley Wren (the “boys”) and myself.
13.We arrived at the Site around 6:20 am, and were about the head to the Site sheds prior to starting work. I asked Carmelo whether we could start work. This was a question I usually asked in the morning because at the time there were drillers and plumbers on site.
He explained that this was something he “[a]lways asked because sometimes we’ve got to shuffle our work zones around other trades.” When asked why that was, he stated, “Well, just the nature of our job, danger of our job.”
His affidavit continued:
14.Carmelo said to me that Hughes would not be able to start work yet. Carmelo then said words to the effect of: “Tell the boys to hang around until we can get further notice that we can start work”. At this time the Hughes employees and I were just outside the Site sheds. I asked him why we couldn’t start work and he said: “We’ve got a union bloke coming to have a site meeting.”
15.I asked Carmelo if we should unload the tools or not. I cannot remember how he responded. I said something like, “Oh will we just sit tight?”. I told the boys to go and get the expensive tools and bring them on to the Site. I also said to them: “We are not allowed to work, I’ll call Dave and see what the story is”.
16.I then rang Alex Loft, the estimator for Hughes, and told him what had happened. Alex said to me: “Wait there”.
17.I then rang Dave to clarify what was going on, because I was not sure why we were being stopped from working. Dave said to me to get the boys to sit tight in the Site shed and got to the meeting with the union representative, and that the boys were not to walk off Site as he would work it out and get back to me. Following this conversation, I told the boys to go and sit in the Site shed.
18.I do not remember whether I spoke with Carmelo after I had spoken to Dave.
19.…
20.I did ask Carmelo whether we should unload the tools off the ute, because Hughes took expensive tools off the Site each night. I asked this after Carmelo had said that Hughes couldn’t start work.
21.I do not recall Carmelo asking: “Why did you take your tools off site? You have always locked them on site”, but it is possible he said this.
22.I do not remember Carmelo asking: “Why are you asking me if you’re allowed to unload your ute and start working?”.
The Commissioner contended that Mr Theodorou was involved in Mr Silvestro’s contraventions pursuant to s 550(2). He was an intentional participant based on his knowledge of the essential facts constituting the contravention or, he was, at least, wilfully blind: see Yorke v Lucas (1985) 158 CLR 661 at 666-667 (Mason ACJ, Wilson, Deane, Dawson JJ). He knew the employees had been prevented from working. He knew that Mr Silvestro had prevented them from doing so because Hughes Demolition lacked an EBA and because Mr Silvestro wished to force it to make one or conform to the CFMEU’s request that it do so.
Mr Theodorou’s knowledge could be inferred from the following. On 19 November 2013, he knew that Hughes Demolition did not have an EBA and proposed not to enter one. He had threatened both Harris Interiors and Hughes Demolition that, if the latter did not make an EBA, its employees would be prevented from working on 19 November 2013. He attended the Site on 19 November to discuss, with Hughes Demolition’s employees, the possibility of Hughes Demolition making an EBA. This was the same morning that Mr Silvestro stopped the work.
It could be inferred that Mr Theodorou acted in concert with Harris Interiors to arrange for Harris Interiors to prevent the Hughes Demolition employees from working on the Site. That inference, he said, was strengthened by his failure to give evidence: McCollough at [151]‑[154] (Barker J).
The Commissioner also submitted that Mr Theodorou was liable (pursuant to s 362(1)) by advising, inciting and encouraging Mr Silvestro’s conduct on 19 November 2013.
Respondents’ submissions
Mr Silvestro submitted that he had not contravened s 354 because he did not prevent the employees from working. He relied on the same evidence to support his denial as he had done in relation to the coercion claims made against him. He again relied upon ADCO (No 2) at [102]-[106] and [186]-[187].
Mr Theodorou submitted that s 550 was not engaged as he had no knowledge of the alleged contravention. When he attended on 19 November 2013 it was morning tea or “smoko” time. It was, therefore, unsurprising that the employees were not working. Mr Silvestro had been content for him to attend and speak to the employees during breaks. There was no evidence of his knowledge of the fact of or reasons for any stoppage. Absent clear evidence as to who directed it, the Court should not draw an inference of that he knew of it. The employees returned to work shortly after his attendance; this told against an inference that he was complicit in any contravention. His submissions did not expressly confront the Commissioner’s case in so far as it was founded on s 362.
Consideration
Reverse onus — s 361
Again, I commence by confirming that the reverse onus in ss 361 is engaged on the Commissioner’s pleaded case. The “particular reason” that Mr Silvestro was said to have discriminated against Hughes Demolition is pleaded at [101] of the amended statement of claim (that the Hughes employees were, or it was proposed that they would not be, covered by an EBA).
The material facts, which show that the alleged action, in combination with the particular reason, would constitute a contravention of s 354, are pleaded at [11] (that Hughes Demolition had not made an enterprise agreement), [85] (the work stoppage) and [100] (the burden or adversity caused by the discriminatory conduct).
As a result the preconditions for the application of s 361 are met in relation to Mr Silvestro’s alleged contravention of s 354.
Mr Silvestro
For the reasons given in relation to the adverse action claims made against him (see above at [368]-[371]) I have found that Mr Silvestro directed that the Hughes Demolition employees should not work on the morning of 19 November 2013 and that, as a result, they did not do so for some hours. Hughes Demolition suffered a detriment by reason of the delay to its timetable that day. No such direction was given to any other sub-contractors’ employees on that morning. He thereby discriminated against Hughes Demolition.
It was alleged against him that he had so acted because those employees were not covered by a particular type of workplace instrument, an enterprise agreement.
I do not consider that Mr Silvestro has proven that he did not act for this reason. It is, therefore, to be presumed that he did so.
For these reasons I find that Mr Silvestro contravened s 354 on 19 November 2013.
Mr Theodorou
An allegation that a person has contravened a civil remedy provision of the Act is serious. An adverse finding will render the person liable for a monetary penalty. Such contraventions are treated as being “quasi-criminal”. As a result the provisions of s 140(1) and (2) of the Evidence Act 1995 (Cth) establish the standard of proof which is required to make good such an allegation. Adverse findings are not lightly to be made particularly where, as in a case such as the present, those findings are sought on the basis of inferences rather than direct evidence: see Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] FCA 42 at [60]-[62] (Flick J).
I am not satisfied Mr Theodorou was involved in Mr Silvestro’s contravention of s 354.
Mr Theodorou was not present at the Site when Mr Silvestro gave the direction that the Hughes Demolition employees were not to commence work. There was no direct evidence that he had any foreknowledge that such a direction was to be given. This is so despite his earlier threat on 15 November 2013 that he would not let the boys work on the Site. His arrival on the Site coincided with or, at least, immediately preceded a scheduled work break for the Hughes Demolition employees. It was hardly surprising then that he found them in the sheds. Not long afterwards the workers either commenced work for the day or resumed work.
In these circumstances I am not prepared to infer that Mr Theodorou had knowledge of Mr Silvestro’s decision to prevent the commencement of work. Section 550 is not engaged.
Nor am I satisfied that Mr Theodorou advised, encouraged or incited Mr Silvestro to take such action for the purposes of s 362.
It has not been established that Mr Theodorou has contravened s 354.
CFMEU’S LIABILITY
The Commissioner pleaded that the CFMEU was liable for the contraventions of:
(1)ss 345 and 349 (misrepresentation) by Mr Theodorou on 23 October 2013.
(2)ss 345 and 349 (misrepresentation) by Mr Theodorou or Mr Reardon in October 2013.
(3)ss 340 (adverse action), 343 and 348 (coercion) by Mr Theodorou on 15 November 2013.
(4)ss 340 (adverse action), 343, 348 (coercion) and 354 (discrimination) by Mr Theodorou (via s 362, and, in the case of s 354, s 550) for the work stoppage caused by Mr Silvestro on 19 November 2013.
The claimed bases for the CFMEU’s liability were that, under the common law and s 793, Mr Theodorou had actual, apparent or ostensible authority to engage in the impugned conduct on behalf of the CFMEU. Under s 363, his conduct was to be taken to be conduct of the CFMEU because, as a CFMEU representative, he was acting as one of its officers or agents.
In relation to the first, third and fourth sets of contraventions listed at [472], the Commissioner relied upon the common law and s 793 as well as s 363. In relation to the second set of contraventions listed the Commissioner confined his case to s 363.
The CFMEU admitted that action taken by its officers in that capacity is taken to be its action. It denied liability on the basis that none of the primary contraventions had been established.
Section 363 relevantly provides:
363 Actions of industrial associations
(1)For the purposes of this Part, each of the following is taken to be action of an industrial association:
…
(b)action taken by an officer or agent of the industrial association acting in that capacity;
…
…
(3)If, for the purposes of this Part, it is necessary to establish the state of mind of an industrial association in relation to particular action, it is enough to show:
(a)that the action was taken by a person, or a group, referred to in paragraphs (1)(a) to (e); and
(b)that the person, or a person in the group, had that state of mind.
(4)Subsections (1) to (3) have effect despite subsections 793(1) and (2) (which deal with liabilities of bodies corporate).
Section 793 provides:
793 Liability of bodies corporate
Conduct of a body corporate
(1)Any conduct engaged in on behalf of a body corporate:
(a)by an officer, employee or agent (an official) of the body within the scope of his or her actual or apparent authority; or
(b)by any other person at the direction or with the consent or agreement (whether express or implied) of an official of the body, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;
is taken, for the purposes of this Act and the procedural rules, to have been engaged in also by the body.
State of mind of a body corporate
(2)If, for the purposes of this Act or the procedural rules, it is necessary to establish the state of mind of a body corporate in relation to particular conduct, it is enough to show:
(a)that the conduct was engaged in by a person referred to in paragraph (1)(a) or (b); and
(b)that the person had that state of mind.
Meaning of state of mind
(3) The state of mind of a person includes:
(a)the knowledge, intention, opinion, belief or purpose of the person; and
(b)the person’s reasons for the intention, opinion, belief or purpose.
…
Consideration
The Commissioner relies on ss 363 and 793 of the Act to attribute liability to the CFMEU. Justice Flick in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] FCA 42 at [51] summarised the object of s 793 as follows:
[It] is directed to identifying those circumstances in which a body corporate is to be “taken … to have been engaged” in conduct pursued by (for example) “an officer, employee or agent”. The heading to that section is “Liability of bodies corporate”. It is thus a section clearly directed at sheeting home to a body corporate “liability” for the conduct of others.
I have found that Mr Theodorou contravened ss 345 and 349 on 23 October 2013. I have also found that he contravened s 340, 343 and 348 on 15 November 2013. In making the impugned representations, taking the adverse action, and engaging in the coercion, Mr Theodorou was acting within the scope of his actual or apparent authority as an officer of the CFMEU. It follows, in accordance with s 793(1) of the Act, that the CFMEU is also taken to have engaged in Mr Theodorou’s misconduct and thereby contravened ss 340, 343, 345, 348 and 349.
The contravention of ss 345 and 349 in late October 2013 occurred because either Mr Theodorou or Mr Reardon made a misrepresentation in the course of their dealings with Mr Seckold. The Commissioner was unable to establish which of these officials had made the representation. As a result the Commissioner only sought to establish liability, on the part of the CFMEU, for these contraventions by resort to s 363(1)(b). I am satisfied that the representation was made. I am also satisfied that it was made by a CFMEU official. The making of the misrepresentation is taken to be the action of the CFMEU because it was made by one of its officials acting in that capacity.
The CFMEU is not liable for the contraventions listed above at [472(4)] because I have found that the allegations against Mr Theodorou have not been established:
·In relation to the claims of adverse action contrary to s 340 and coercion contrary to ss 343 and 348 I have found that Mr Theodorou did not advise, incite or encourage (s 362) Mr Silvestro to procure the work stoppage on 19 November 2013.
·In relation to the claim of discrimination contrary to s 354 I have found that Mr Theodorou was not involved in (s 550), and did not advise, incite or encourage (s 362), Mr Silvestro to procure the work stoppage on 19 November 2013.
HARRIS INTERIORS’ LIABILITY
The Commissioner pleaded that Harris Interiors was liable for the contraventions of:
(1)ss 340 (adverse action), 343 and 348 (coercion) by Mr Dwyer on 15 November 2013.
(2)ss 340 (adverse action), 343 and 348 (coercion) by Mr Darker on 15 November 2013.
(3)ss 340 (adverse action), 343, 348 (coercion) and 354 (discrimination) occasioned by Mr Silvestro’s direction on 19 November 2013.
(4)ss 343 and 348 (coercion) by, collectively, the threats of Messrs Dwyer and Darker and Mr Silvestro’s direction (“the alternative claim”).
Commissioner’s submissions
The Commissioner submitted that, under the common law and s 793, Messrs Dwyer, Darker and Silvestro had actual, apparent or ostensible authority to engage in the impugned conduct for and on behalf of Harris Interiors.
If the Court failed to find that their individual conduct amounted to coercion, then it should find that it collectively amounted to action engaged in by Harris Interiors, though its human agents, which was intended to coerce Hughes Demolition contrary to ss 343 and 348. Coercive conduct could be found in a course of conduct. Counsel emphasised that this was an alternative argument; he was not asking the Court to find both single and collective contraventions.
Harris Interiors’ submissions
Harris Interiors accepted that Messrs Dwyer, Darker and Silvestro were acting within the scope of their actual and apparent authority at all times and that, therefore, their actions were to be taken to be those of Harris Interiors. It nevertheless denied all of the alleged contraventions.
The “alternative claim” added nothing, it submitted, to the existing vicarious liability claims for the individual alleged contraventions. Counsel relied, to the extent that it was relevant, on the fact that intent was to be judged on an individual rather than a group basis: Geelong Wool Combing Ltd v Textile, Clothing and Footwear Union of Australia (2003) 130 FCR 447 at 454; [2003] FCA 773 at [17] (Finkelstein J).
Consideration
There was no dispute that, at relevant times, Messrs Darker, Dwyer and Silvestro were acting within the scope of their actual and apparent authority as employees of Harris Interiors and that their actions were to be taken to be those of the company.
Accordingly, their conduct, to the extent to which it gave rise to contraventions of the Act, is to be taken to have been engaged in by Harris Interiors and to have caused Harris Interiors itself to also contravene the Act.
It is not necessary that I deal with the Commissioner’s alternative claim.
COSTS
The third to sixth respondents, the Harris respondents, sought an order for costs in relation to the Commissioner’s decision to not call Mr Woods for cross-examination.
They relied upon s 570(2)(b) of the Act. That section provides:
570 Costs only if proceedings instituted vexatiously etc.
(1)A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A.
Note:The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 569A.
(2)The party may be ordered to pay the costs only if:
(a)the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or
(b)the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs; or
(c)the court is satisfied of both of the following:
(i)the party unreasonably refused to participate in a matter before the FWC;
(ii)the matter arose from the same facts as the proceedings.
They also sought disbursements under the Federal Court Rules 2011 (Cth) Sch 3 cl 18.
Background
The application was supported by emails handed up at trial. The Commissioner’s counsel also handed up two emails with attachments. The tender of the emails was not challenged. I am prepared to rely upon them for the purposes of this application.
In April 2015 the solicitors for the Harris respondents filed and served Mr Woods’ affidavit.
By email of 4 February 2016, the solicitors for the Harris respondents asked the other parties which witnesses they wanted to cross-examine, noting that Mr Woods was in the United Kingdom. The next day, on 5 February 2016, the Commissioner indicated via email that he would cross-examine all witnesses and that he did not object to a video link.
On 2 and 3 February 2017 the solicitors for the Harris respondents corresponded via email with the other parties, including the Commissioner, as to the timing of a video link for Mr Woods.
On 6 February 2017 at 5.17 pm the Harris respondents served their submissions via email.
Later that day, at 5.20 pm, the solicitors for the Harris respondents emailed chambers to request leave for Mr Woods to appear via video link. They indicated that the other parties consented and that they proposed to use Video Conferencing London (“VCL”).
Later that same evening, VCL emailed the Harris respondents’ solicitors to advise that it needed full payment upfront. The booking was confirmed the next day on 7 February 2017. The next evening, on 8 February 2017, VCL confirmed that it had received a payment of £720.
Earlier on 8 February 2017, at 9.39 am, the Harris respondents served their list of authorities.
On 10 February 2017 at 11.29 am the Commissioner’s solicitors informed the solicitors for the Harris respondents via email that, “[i]n preparation for hearing, the Applicant has determined that it does not require Mr Woods for cross-examination.” The email continued:
The Applicant is content for Mr Woods’ affidavit evidence to be tendered in Court without him appearing by videolink (subject to the amendment to paragraph 35 of his affidavit to use the alternative working suggested by your response to evidentiary objections). If the Respondents agree with the Applicant’s proposed approach, we ask that you inform the Court and cancel the videolink.
The video link was cancelled. The Court was informed that VCL refunded half the costs. In the afternoon of 10 February 2017 the solicitors for the Harris respondents wrote to the Commissioner’s solicitors to request that he consent to a costs order. He did not consent.
Harris respondents’ submissions
The Harris respondents submitted that Commissioner’s unreasonable act or omission caused them to incur costs and disbursements when preparing for Mr Woods’ cross-examination.
They had relied on his representation of 5 February 2016 that “all witnesses” were required. Between that date and 10 February 2017 they prepared for trial, held witness conferences with Mr Woods, communicated with the Court, and engaged VCL.
During that period the Commissioner was in communication with the parties. Despite this, it was not until 10 February 2017 (the last business day before trial) that he advised that his position on Mr Woods had changed. This delay was unexplained and unreasonable.
The Commissioner could not avoid the costs consequences of this reversal by technical temporal arguments. Section 570 was a causal provision. It was accepted that the costs were incurred before the notification. The notification, however, could not be divorced from the preceding conduct, including the initial representation. In light of his “backflip” it was unreasonable that they had incurred those costs.
This case was distinguishable from those where costs should not be awarded because to do so would dissuade applicants from bringing meritorious claims. It was appropriate to award costs in this case as they were incurred as a result of the Commissioner not having his house in order.
Commissioner’s submissions
The Commissioner submitted that the Harris respondents’ submission and authorities, served on 6 and 8 February 2017 respectively, were critical to his decision no longer to require Mr Woods for cross-examination. That was why he had not earlier advised of his position.
At that point it became clear that the Harris respondents’ case centred on ADCO (No 2). The issues of pre-contract representations about the EBA were less relevant. Mr Woods’ evidence was most relevant to the pre‑contract meetings. He had no involvement in CFMEU discussions. The Commissioner formed the view that Mr Woods’ evidence would not be adverse to his position. He could distinguish ADCO (No 2) without testing such evidence.
The Court’s discretion to award costs is only enlivened if it finds that an unreasonable act caused the costs to be incurred. This power should not be exercised with haste so as to discourage parties from pursuing litigation under the Act in a manner which they deem best: see Construction, Forestry, Mining and Energy Union v Clarke (2008) 170 FCR 574 at 582; [2008] FCAFC 143 at [29] (Tamberlin, Gyles and Gilmour JJ). This included forensic decisions on cross-examination.
He relied upon Ashby v Slipper (No 2) (2014) 314 ALR 84 at 89; [2014] FCAFC 67 at [35] where Mansfield, Siopis and Gilmour JJ said “costs will rarely be awarded under the section and exceptional circumstances are required to justify the making of such an order”, citing Council of Kangan Batman Institute of Technology and Further Education v Australian Industrial Relations Commission (2006) 156 FCR 275 at 289; [2006] FCAFC 199 at [60] (Black CJ, North and Mansfield JJ).
His decision to not require Mr Woods’ attendance was neither exceptional nor unreasonable. The London factor was the only possible source of unreasonableness; the notification would be unremarkable otherwise. Even if the notification was unreasonable, the costs incurred were not caused by the Commissioner. He did not cause Mr Woods to be outside of the jurisdiction.
Merely because the Commissioner no longer required Mr Woods to appear did not mean that the witness conferences would not have occurred. They were not caused by his conduct, let alone any unreasonable conduct.
Consideration
Section 570(1) strictly limits the circumstances in which the Court may award costs in a proceeding under the Act. Such costs may be awarded, pursuant to s 570(2)(b), if “the court is satisfied that the party’s unreasonable act or omission caused the other party to incur costs”.
I am not satisfied that the Commissioner’s decision, not to require Mr Woods to appear for cross-examination, made on 10 February 2017, caused the Harris Interiors parties to incur the costs of conferences with Mr Woods or the pre-payment to VCL for the scheduled video link.
More significantly, in my opinion, the timing of the Commissioner’s forensic decision and his notification to the solicitors acting for the Harris respondents cannot be characterised as unreasonable. The decision was conveyed within four days of the service of the Harris respondents’ written submissions. Those submissions clarified certain issues which the Commissioner determined rendered it unnecessary to cross-examine Mr Woods.
It is a regular occurrence, in the course of litigation, that parties change their positions, both substantively and procedurally, in the light of pre-trial developments and things that occur in the running of a trial. Had the Commissioner decided at trial that he no longer wished to cross-examine Mr Woods because, for example, of concessions made under cross-examination by other witnesses called by Harris Interiors, such a decision could hardly be described as unreasonable. Indeed the contrary would be true; court time would not be wasted pursuing factual issues which were no longer in dispute. This is no less true of decisions made before the trial commenced.
This is not one of the rare cases in which it would be appropriate, in the exercise of the Court’s discretion, to make a costs order.
The Harris Interiors’ application for costs must be refused.
DISPOSITION
I will give directions for the parties to make submissions relating to the relief sought by the Commissioner for the various contraventions of the Act which I have found to have occurred.
I certify that the preceding five hundred and twenty (520) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey. Associate:
Dated: 1 August 2018
SCHEDULE OF PARTIES
VID 523 of 2014 Respondents
Fourth Respondent:
CARMELO SILVESTRO
Fifth Respondent:
SHANNE DARKER
Sixth Respondent:
JASON DWYER
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