Capital Maintenance Solutions v David Fraser
[2022] FWCFB 8
•3 FEBRUARY 2022
| [2022] FWCFB 8 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.604—Appeal of decision
Capital Maintenance Solutions
v
David Fraser
(C2022/308)
| VICE PRESIDENT CATANZARITI | SYDNEY, 3 FEBRUARY 2022 |
Appeal against interlocutory decision of Deputy President Dean made on transcript on 21 December 2021 refusing application to set aside order for production of documents – permission to appeal refused.
Capital Maintenance Solutions (the Appellant) has lodged an appeal under s 604 of the Fair Work Act 2009 (Cth) (the Act) for which permission to appeal is required against a decision of Deputy President Dean (the Deputy President) made on 21 December 2021.
By way of brief background, on 2 December 2021, the Deputy President issued an order (the Order) requiring the production of certain documents in the possession of Capital Maintenance Solutions Pty Ltd (the Appellant). Relevant to the current appeal are categories 33 and 35 contained in the schedule of the Order. They are as follows:
“33. Copies of tax returns of Capital maintenance Solutions Pty Ltd from 2018/2019, 2019/2020, and 2020/2021 financial years.
35. Copies of bank statements for all accounts held by Capital Maintenance Solutions Pty Ltd for the period:
a. 18 August 2018 to 29 July 2021.
b. 30 July 2021 to 24 November 2021.”
On 9 December 2021, the Appellant made an application that the above orders be set aside (the Application). On 21 December 2021, the Deputy President made a decision, on transcript, refusing the Application. The Deputy President found that the documents were “apparently relevant” to the unfair dismissal application of Mr Fraser (the Respondent). The matter before us is the appeal of that interlocutory decision (the Decision).
Directions were set for the filing of material and the matter was listed for hearing. Prior to hearing, the Appellant sought permission to be represented by a lawyer. The Respondent opposed the grant of permission for the Appellant to be represented at the hearing. We refused permission for legal representatives to appear. In those circumstances and given the comprehensive written submissions already filed, the parties consented to have the matter determined on the papers. Further submissions were filed by the parties in lieu of a hearing and we have considered that material.
For the reasons that follow permission to appeal is refused.
Principles of Appeal
The Decision under appeal is one made under ss 589 and 590 of the Act being an interlocutory decision exercised in the context of an unfair dismissal application. A question arises then, regarding whether s 400 applies to an appeal against decisions of this nature as an application for an unfair dismissal remedy is made pursuant to Pt 3 – 2 of the Act.
On this issue, a differently constituted Full Bench in Kennedy v Qantas Ground Services Pty Ltd[1] found the following:
“[9] Section 400(1) modifies s.604(2) of the Act in relation to appeals from decisions made under Part 3-2, which concern unfair dismissal applications. It provides that, despite subsection 604(2), the Commission must not grant permission to appeal from such decisions unless it considers that it is in the public interest to do so. If s.400(1) applies, the public interest is the sole criterion for the grant or refusal of permission to appeal. If the appeal bench does not consider that it is in the public interest to grant permission to appeal, it must refuse such permission. In Coal & Allied Mining Services Pty Ltd v Lawler, the Federal Court characterised the test under s.400 as ‘stringent’.
[10] The Deputy President’s decision was made under s 590, which allows the Commission to inform itself in relation to any matter before it in such manner as it considers appropriate, including by requiring a person to provide copies of documents or records (s 590(2)(c)). Section 590 is in Part 5-1 of the Act and on this basis it might be contended that s 400 does not apply to decisions made under that provision. However, the Decision was made in relation to an application brought under Part 3-2 of the Act, namely Mr Kennedy’s unfair dismissal application. In Australian Postal Corporation v Gorman ([2011] FCA 975, 196 FCR 126 at [37]), Besanko J concluded that an appeal from a decision to dismiss an unfair dismissal proceeding under s.587 of the Act was a decision to which s 400 applied. Section 587, like s 590, is found in Part 5-1 of the Act. Further, in Asciano Services Pty Ltd v Hadfield ([2015] FWCFB 2618), a Full Bench of the Commission decided that s 400 applied to an appeal from a decision not to grant permission for representation under s 596 of the Act in respect of an unfair dismissal application.
[11] The apparent purpose of s 400 is to confine the circumstances in which unfair dismissal applications can be appealed so as to promote the finality of litigation with respect to such claims. It would be contrary to this purpose if the limitation applied to substantive decisions made under Part 3-2, but not to procedural or interlocutory decisions concerning those same matters. In our view, the present appeal is one from a decision made under Part 3-2 of the Act. The Decision dealt with applications for the production of documents in an unfair dismissal proceeding brought before the Commission under that part of the Act. Accordingly, we consider that s 400(1) of the Act applies to the matter before us.”
[Footnotes omitted]
The above approach has been adopted by later decisions of the Commission.[2] We agree with this approach.
Grounds of appeal and submissions
The Appellant’s grounds of appeal as set out in its F7 Notice of Appeal can be summarised as follows:
The Deputy President failed to give reasons as to why the documents sought were “apparently relevant”
The documents sought are not apparently relevant to any matter or issue to be determined in the substantive proceeding.
The documents are confidential business records of the appellant and are commercially sensitive.
The documents are being sought for an improper purpose.
The Appellant submits that because the Deputy President did not give reasons beyond finding that the documents were “apparently relevant” it is impossible to know whether the Deputy President assessed the apparent relevance of each of the categories of documents sought.
The Appellant also submits that the Deputy President erred in finding that the financial documents of the Appellant were apparently relevant. In the substantive unfair dismissal application, the Respondent has taken the position that the reasons given for his dismissal were fabricated to enable his immediate termination because he was a shareholder and not just an employee of the Appellant. It is the Appellant’s contention that the documents sought by the Respondent are not relevant to this issue and the Deputy President erred in finding that the documents were apparently relevant.
Finally, the Appellant submits that the documents being sought are of a commercially sensitive nature and that they are being sought for an improper purpose, as the Respondent has now set up a rival business to that of the Appellant. It is the Appellant’s position that there are no reasonably practicable steps that can be taken to maintain the confidentiality of the documents while still compelling their production because it is the Appellant’s interest to maintain confidentiality from the Respondent so he cannot use the information to aid in the development of a competing business.
Respondent’s submissions
In his written submissions, the Respondent contends that adequate reason was given by the Deputy President in finding that the documents were apparently relevant. The Respondent further contends that the financial documents are not only apparently relevant but are directly so. As previously mentioned, the Respondent maintains the position that the Appellant has fabricated a valid reason for dismissal. It is the Respondent’s submission that the documents being sought are relevant to the proceedings before the Deputy President because they are required to resolve the question of whether or not the Respondent has engaged in the conduct for which he has been terminated.
The Respondent submits that the documents being sought are neither confidential nor commercially sensitive. It is the Respondent’s assertion that the Appellant has already supplied him with a summary of what they say is contained in the documents being sought. The Respondent contends then, that the information being sought is already in his hands and the official documentation is being sought to ensure that it correlates with the summary provided to him by the Appellant. The Respondent further submits that he is not a trade rival to the Appellant and also denies that the documents are being sought for an irrelevant collateral purpose. The Respondent asserts that the documents are sought in order to “negate” allegations that have been made against him by the Appellant in the proceedings before the Deputy President.
Final written submissions
As aforementioned, in lieu of an oral hearing, both parties made further written submissions.
The Appellant submitted that the Respondent’s request for its bank statements is not relevant to matters in dispute before the Deputy President. It is the Appellant’s submission that the Respondent performed plumbing work, for his own benefit, for clients or potential clients of the Appellant in breach of his contract of employment. The Appellant submits that it requested financial information from the Respondent’s company in order to determine whether this was true as it suspects him of utilising his company to receive payment from clients. The Appellant’s financial information, it is submitted, is not apparently relevant to the issue of the Respondent’s dismissal.
The Appellant also submits, inter alia, that the Respondent was never privy to the financial records of the Appellant and has only ever been provided with “one very basic” profit and loss statement for the 2018/2019 year. The Appellant submits that the level of detail that the Respondent is now seeking is something that is not shared with the Appellant’s employees and certainly would not be shared with its competitors – the Appellant has plainly stated it considers the Respondent to now run a competitor business.
The Respondent’s submissions generally dispute the submissions of the Appellant. The Respondent asserts he has not breached his contract of employment. The Respondent submits that the Appellant was aware of the Respondent’s company and that its assertion that he used it in competition with them without the Appellant’s knowledge is false. The Respondent further submits that the financial documents he is seeking will show that the Appellant was aware that he still operated his company and that the Appellant utilised it to its own advantage. It is the Respondent’s assertion that obtaining the Appellant’s financial records will “negate” the Appellant’s claim that he operated his company without the Appellant’s knowledge.
Consideration
For the reasons that follow, we are not satisfied that the grant of permission to appeal would be in the public interest, nor do we consider that there are discretionary grounds justifying the grant of permission.
First, the appeal is one against an interlocutory procedural decision of a discretionary nature. It is well settled that appeals against decisions of this nature are to be deprecated and will rarely be the subject of the grant of permission to appeal.[3] The Deputy President has issued the Order and made the Decision in the course of her case management of the Respondent’s unfair dismissal application and an appellate body would rarely intervene in case management issues.
Second, whether or not the documents being sought are relevant is an issue for the Member at first instance to decide and they are best placed to do so. A Full Bench will only intervene in circumstances where it is glaringly obvious that the documents sought are irrelevant to live issues in the matter at first instance. In the current matter, we do not consider that the documents sought are obviously irrelevant.
Third, the Appellant’s concerns regarding the commercially sensitive and confidential nature of the documents being sought can be remedied by seeking confidentiality orders before the Deputy President. Such orders may include that the documents be destroyed at the conclusion of proceedings so as to prevent the Appellant from utilising them for the advancement of his competing business although we would note that it is unclear to us how tax returns or banking statements would give rise to any competitive advantage. Ultimately, we do not consider it necessary to prevent the production of those documents for reasons regarding confidentiality.
Fourth, the appeal raises no legal or policy issue of importance or general application.
Accordingly, permission to appeal is refused.
VICE PRESIDENT
Hearing details:
Matter determined on the papers
Final written submissions:
Appellant’s written submissions 27 January 2022.
Respondent’s written submissions 27 January 2022.
[1] [2018] FWCFB 4552.
[2] See You v CSIRO [2020] FWCFB 3804 at [19] and Kennedy v Qantas Ground Services Pty Ltd [2019] FWCFB 6094 at [26] and Willis v BE Imaging Pty Ltd t/a Iris Imaging [2021] FWCFB 6030 at [19].
[3] You v SIRO [2020] FWCFB 3804 at [23]; Kennedy v Qantas Ground Services Pty Ltd [2019] FWCFB 6094 at [29]; Hutton v Sykes Australia Pty Ltd [2014] FWCFB 3384 at [3].
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