Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union v Carlton Sheet Metal Pty Ltd

[2010] FMCA 280

FEDERAL MAGISTRATES COURT OF AUSTRALIA

AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING & KINDRED INDUSTRIES UNION v CARLTON SHEET METAL PTY LTD & ORS [2010] FMCA 280

PRACTICE & PROCEDURE – Alleged principal contravener in liquidation – proceedings stayed against principal contravener – other respondents alleged to have been involved in alleged primary contravener’s contraventions – whether findings of accessorial liability are available in the circumstances.

Fair Work Act 2009, s.550
Workplace Relations Act 1996, s.728
Trade Practices Act 1974, ss.75B, 76

Torpia v Empire Printing (Australia) Pty Ltd [2009] FMCA 853
Australian Competition & Consumer Commission v Australian Securities & Investments Commission (2000) 174 ALR 688
Matheson Engineers Pty Ltd v EL Raghy (1992) 37 FCR 6
Australian Competition & Consumer Commissionv Albert (2005) 223 ALR 467
Australian Competition & Consumer Commission v Black on White Pty Ltd (2001) 110 FCR 1

Applicant: AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING & KINDRED INDUSTRIES UNION

First Respondent: CARLTON SHEET METAL PTY LTD ACN 001 310 738

Second Respondent: CARLTON SHEET METAL SYDNEY PTY LTD ACN 131 918 422

Third Respondent: CSM AUSTRALIA PTY LTD ACN 124 755 193

Fourth Respondent: INDUSTRY ACCESS & HIRE PTY LTD ACN 124 755 193

Fifth Respondent: SIMON ROBERT USALJ

Sixth Respondent: DOMINIC USALJ

Seventh Respondent: FILOMENA USALJ

Eighth Respondent: JOSEPH USALJ

Ninth Respondent: ANTOINETTE FRANKLAND

Tenth Respondent: CRAIG FRANKLAND

File Number: SYG 1579 of 2009

Judgment of: Cameron FM

Hearing date: 9 April 2010

Date of Last Submission: 9 April 2010

Delivered at: Sydney

Delivered on: 9 April 2010

REPRESENTATION

Representative of the Applicant: Mr A. Walkaden  

Lawyer for the Second – Tenth Respondents: Mr D. Leamey

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 1579 of 2009

AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING & KINDRED INDUSTRIES UNION

Applicant

And

CARLTON SHEET METAL PTY LTD ACN 001 310 738

First Respondent

CARLTON SHEET METAL SYDNEY PTY LTD ACN 131 918 422

Second Respondent

CSM AUSTRALIA PTY LTD ACN 124 755 193

Third Respondent

INDUSTRY ACCESS & HIRE PTY LTD ACN 124 755 193

Fourth Respondent

SIMON ROBERT USALJ

Fifth Respondent

DOMINIC USALJ

Sixth Respondent

FILOMENA USALJ

Seventh Respondent

JOSEPH USALJ

Eighth Respondent

ANTOINETTE FRANKLAND

Ninth Respondent

CRAIG FRANKLAND

Tenth Respondent

REASONS FOR JUDGMENT

1. Last week directions were made for the preparation of this matter for hearing. A feature of these proceedings is that the first respondent is in liquidation and the proceedings so far as they concern it are stayed. However, it is alleged that certain of the other respondents have accessorial liability for the conduct of the first respondent. At the moment this is pleaded in terms of s.550 of the Fair Work Act 2009 but it is anticipated that amendments to the application will be made to raise claims under the Workplace Relations Act 1996, in which case s.728 of that Act would also become relevant.

2. Following the adjournment of the directions hearing last week, I became concerned that no attention appeared to have been given by the parties to whether it was possible for a respondent to be found to have accessorial liability in respect of conduct alleged to have been undertaken by another respondent who, for all practical purposes, was no longer a participant in the proceedings. Consequently, I ordered that the matter be listed today for the consideration of that issue. 

3. I have been taken today to the decision of Barnes FM in Torpia v Empire Printing (Australia) Pty Ltd [2009] FMCA 853 where her Honour considered the question of accessorial liability in circumstances where the principal had gone into liquidation. At [63] and following, her Honour considered a situation similar to the one presenting in this case and was satisfied that, by analogy with decisions considering s.75B of the Trade Practices Act 1974, the liquidation of the first respondent in the proceedings before her Honour was not a bar to proceedings for penalties on an accessorial basis against the second respondent in those proceedings.

4. It is apparent that s.550 of the Fair Work Act and s.728 of the Workplace Relations Act owe a lot to s.75B of the Trade Practices Act, which concerns liability for accessorial involvement in breaches of that Act. As Barnes FM identified, there is a body of authority on the operation of s.75B which appears to be directly relevant to the question currently before the Court. The following conclusions relevant to these proceedings can be drawn from those authorities:

   a)first, is it not necessary to join the principal contravener in order to obtain relief against an accessorial contravener: Australian Competition & Consumer Commission v Australian Securities & Investments Commission (2000) 174 ALR 688 (which concerned s.76(1) of the Trade Practices Act). The relevant statutory provisions, in this case s.550(1) of the Fair Work Act and s.728(1) of the Workplace Relations Act, are sufficiently clear that accessorial liability may be found without the primary contravener being a party to the action:  Matheson Engineers Pty Ltd v EL Raghy (1992) 37 FCR 6;

   b)secondly, an independent cause of action arises in relation to each person who is relevantly involved in the contravention: ACCC v ASIC;

   c)thirdly, it is entirely inappropriate to make a declaration against a company which is not a party to the proceedings, as is effectively the case here, the first respondent being in liquidation: Australian Competition & Consumer Commissionv Albert (2005) 223 ALR 467;

   d)fourthly, depending on the circumstances in any particular matter, a declaration of contravention may not be necessary or appropriate and findings of fact that a respondent has contravened a provision of the Act may be more appropriate: ACCC v Albert; and

   e)fifthly, findings or declarations of accessorial liability would be dependent only on a finding on the basis of evidence proved to the satisfaction of the Court that the first respondent had contravened the Act in the manner alleged. A declaration against the first respondent would not be necessary: Australian Competition & Consumer Commission v Black on White Pty Ltd (2001) 110 FCR 1.

5. For these reasons, I find that there is no need to vary the directions made on the last occasion or to make any further directions related to the accessorial liability question. 

6. Before I conclude, I should note that Mr Walkaden for the applicant referred the Court to various portions of Barnes FM’s decision in Torpia’s case dealing with the orders that the Court might be able to make against a person found to have accessorial liability and, in particular, to the possibility that the Court may have power under the Fair Work Act, as would appear from Torpia’s case to be the position under the Workplace Relations Act, to make against a party found to have accessorial liability compensatory orders beyond the penalties which may be imposed by reason of a breach of a civil penalty provision. However, it is not necessary to decide those matters today. I simply note that those submissions have been made in the expectation that they will be pursued in greater detail when the matter comes on for hearing.

I certify that the preceding six (6) paragraphs are a true copy of the reasons for judgment of Cameron FM

Associate: 

Date:  9 April 2010