FEDERAL CIRCUIT COURT OF AUSTRALIA
Carbone v McConvill & Associates (No 2) [2021] FCCA 1110
File number(s): MLG 3620 of 2019 Judgment of: JUDGE MCNAB Date of judgment: 24 May 2021 Catchwords: INDUSTRIAL LAW – costs and pre-judgment interest – applicant does not seek costs of proceedings – dispute as to the manner in which the quantum of pre-judgment interest is to be calculated – respondents seek order staying payment of compensation and pecuniary penalties previously ordered, and any amount to be ordered in respect of pre-judgment interest – no formal application or material filed in respect of stay order sought – no stay order made. Legislation: Competition and Consumer Act 2010 (Cth) sch 2.
Fair Work Act 2009 (Cth) s 547.
Federal Circuit Court of Australia Act 1999 (Cth) s 76.
Federal Circuit Court of Australia Rules 2001 (Cth) r 29.04.
Cases cited: Carbone v James McConvill & Associates [2021] FCCA 661 Number of paragraphs: 18 Date of last submission/s: 14 May 2021 Date of hearing: On the Papers Place: Melbourne Solicitor for the Applicant: Coopers and Sanders Legal Solicitor for the Respondents: Carter Newell Lawyers ORDERS
MLG 3620 of 2019 BETWEEN: JOESPH CARBONE
Applicant
AND: JAMES MCCONVILL & ASSOCIATES
First Respondent
JAMES MCCONVILL
Second Respondent
ORDER MADE BY:
JUDGE MCNAB
DATE OF ORDER:
24 MAY 2021
THE COURT ORDERS THAT:
1.In respect of pre-judgment interest, the First Respondent and Second Respondent jointly and severally pay to the Applicant the sum of $21,944.70.
REASONS FOR JUDGMENT
Judge McNab:
INTRODUCTION
On 9 April 2021 the Court entered judgment in this matter under the media neutral citation ‘Carbone v James McConvill & Associates [2021] FCCA 661’. These reasons should be read in conjunction with the reasons set out in that decision.
The Applicant’s claim initially arose out of breaches of the Fair Work Act 2009 (Cth) (“the FW Act”), the Australian Consumer Law, as set out in Schedule 2 of the Competition and Consumer Act 2010 (Cth) (“the ACL”) and breach of contract (however, the claim for breach of contract was ultimately abandoned). Default judgment was entered in the Applicant’s favour by the Federal Court of Australia on 16 September 2019. The matter was remitted to this Court by the Federal Court for the assessment of damages, pecuniary penalties, and any question of associated costs.
In respect of the proven breaches, orders were made by this Court on 9 April 2021 as follows:
1. In respect of the Applicant’s claim under the Fair Work Act 2009 (Cth) (“the FW Act”), the First Respondent and Second Respondent jointly and severally pay to the Applicant the sum of $157,693.38 pursuant to section 545 of the FW Act.
2. In respect of the Applicant’s claim to compensation under the Competition and Consumer Act 2010 (Cth), the First Respondent and Second Respondent jointly and severally pay to the Applicant the sum of $5,061.45, in respect of annual leave entitlements.
3. In respect of pecuniary penalties, pursuant to section…
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- Case
- [2021] FCCA 1110
- Decision Date
CaseChat Overview and Summary
The court was required to determine whether to grant a stay of the judgment and pre-judgment interest orders, and how to calculate the pre-judgment interest. The respondents had sought a stay by correspondence and a draft minute of orders, but had not filed a formal application supported by affidavit as required by rule 29.04 of the Federal Circuit Court of Australia Rules 2001 (Cth).
McNab J reasoned that pre-judgment interest should be calculated on the amounts ordered for breaches of the Fair Work Act (FW Act) and the Australian Consumer Law (ACL). Section 547 of the FW Act mandates the inclusion of interest in an order unless good cause is shown otherwise, and requires consideration of the period between the cause of action arising and the order being made. The court found that the annual leave entitlement, though claimed under the ACL, was an amount required to be paid under the FW Act. Alternatively, an entitlement to interest existed under section 76 of the Federal Circuit Court of Australia Act 1999 (Cth). Accordingly, the court ordered pre-judgment interest in the sum of $21,944.70.
Regarding the stay application, McNab J noted that no formal application had been filed. Consequently, the court declined to make an order granting a stay at that time.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence Before The Court
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Decision
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Ratio Decidendi
Legal Principle Established
Further, by way of the correspondence and the draft minute of orders provided to Chambers on 10 May 2021, the Respondents seek an order that the payment of the compensation and penalties ordered on 9 April 2021, and any order in respect of pre-judgment interest, be stayed. This order is sought on the basis that the Respondents have filed an appeal of the judgment delivered on 9 April 2021 in the Federal Court on 7 May 2021. The stay order sought by the Respondents is opposed by the Applicant on the basis that no formal application has been made to this Court.CONSIDERATION The parties are in dispute over the sum of $682.45. I am of the view that the quantum of pre-judgment interest to be paid by the Respondents should be calculated on the amounts ordered in respect of the breaches of the FW Act and the ACL. Section 547 of the FW Act provides:(1) This section applies to an order (other than a pecuniary penalty order) under this Division in relation to an amount that a person was required to pay to, or on behalf of, another person under this Act or a fair work instrument.(2) In making the order the court must, on application, include an amount of interest in the sum ordered, unless good cause is shown to the contrary.(3) Without limiting subsection (2), in determining the amount of interest, the court must take into account the period between the day the relevant cause of action arose and the day the order is made. The orders made in respect of annual leave are made on the basis that there had been an admitted breach of the ACL in relation to representations made regarding claims arising under the FW Act. The annual leave entitlement is an amount that the Respondents were required to pay under the FW Act, even though the claim was made under the ACL. If I am wrong on that point, there is an entitlement to interest pursuant to s76 of the Federal Circuit Court of Australia Act 1999 (Cth). Accordingly, I will make orders for pre-judgment interest in the sum sought by the Applicant, being $21,944.70. On 7 May 2021 the Respondents filed an appeal from the primary decision. By their letter provided to the Court on 10 May 2021, the Respondents have sought a stay of the orders made on 9 April 2021 and any order made in respect of pre-judgment interest. No formal application and affidavit material have being filed with the Court pursuant to r29.04 of the Federal Circuit Court of Australia Rules 2001 (Cth). Accordingly, I will not make an order granting a stay at this time.