Carbone v McConvill & Associates (No 2)
[2021] FCCA 1110
•24 May 2021
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 546 of the FW Act:
(a) the First Respondent pay penalties in the total sum of $18,200.00, being:
(i) a civil penalty in the sum of $5,000 for adverse action pursuant to section 342(1), items 1(b), (c) and (d);
(ii) a civil penalty in the sum of $500 for coercion pursuant to section 343 of the FW Act;
(iii) a civil penalty in the sum of $2,500 for the adverse action constituted by the termination of employment pursuant to section 342(1), item 1(a);
(iv) a civil penalty in the sum of $10,200 for the employment records contraventions pursuant to section 535 and section 536 of the FW Act.
(b) the Second Respondent pay penalties in the total sum of $3,490.00, being:
(i) a civil penalty in the sum $600 for the Adverse Action pursuant to section 342(1), items 1(b), (c) and (d);
(ii) a civil penalty in the sum of $100 for coercion pursuant to section 343 of the FW Act;
(iii) a civil penalty in the sum of $750 for the adverse action constituted by the termination of employment pursuant to section 342(1), item 1(a); and
(iv) a civil penalty of $2,040 for the employment records contraventions pursuant to section 535 and section 536 of the FW Act.
4. Pursuant to section 546(3)(c) of the FW Act, the Respondents pay the pecuniary penalties, as set out in order 3 herein, to the Applicant.
5. The Respondents’ application for costs thrown away, made by submissions filed on 12 August 2020, be dismissed.
In relation to the issue of pre-judgment interest and any application for costs of these proceedings, further orders were made as follows:
(a) by 4.00pm on 23 April 2021, the Applicant file and serve:
(i) a minute of draft orders which sets out the quantum of pre-judgment interest to be paid by the Respondents to the Applicant in relation to the compensation ordered herein;
(ii) any application for costs supported by submissions of no more than three (3) A4 pages;
(b) by 4.00pm on 10 May 2021, the Respondents file and serve:
(i) a minute of draft orders which sets out the quantum of pre-judgment interest to be paid by the Respondents to the Applicant in relation to the compensation ordered herein;
(ii) any response in relation to any application for costs, including the quantum of those costs, supported by submissions limited to three (3) A4 pages; and
(c) the Court will make orders in Chambers on the basis of the draft minute and submissions filed by the parties.
Following the delivery of judgment and the orders being made, various correspondence was sent to the Court in relation to an extension of time sought by the Applicant to file and serve the minute of draft orders and any application.
On 16 April 2021, the Respondents ultimately provided a minute of draft orders as to pre-judgment interest to the Court. The Respondent also provided a letter to the Court on the same day setting out the basis on which they say pre-judgment is to be calculated by the Court.
On 10 May 2021, the Applicant provided a minute of draft orders with the Court and also provided a letter setting out the basis on which the quantum of the pre-judgment interest sought in the minute was calculated. By that letter the Applicant informed the Court that he was not seeking his costs.
The Court must now determine the question of calculating the quantum of pre-judgment interest to be awarded in this matter.
ORDERS SOUGHT
There is no dispute as to the time period on which pre-judgment interest is to be calculated, being between 20 July 2018, when the Applicant’s employment was terminated, and 9 April 2021, being the date judgment was delivered.
The Applicant says that pre-judgment interest should be calculated on the basis of the compensation ordered in respect of breaches of the FW Act in the sum of $157,693.38, and the sum of $5,061.45 ordered in respect of the Applicant’s annual leave entitlements claim under the ACL. On that basis, the Applicant say the total amount on which pre-judgment interest is to be calculated is $162,754.83, and therefore seeks that the Respondents pay pre-judgment interest to the Applicant in the sum of $21,944.70.
The Respondents say that the calculation of pre-judgment interest should not include the amount ordered in respect of the Applicant’s annual leave entitlements. The orders of the Court made on 9 April 2021 set out that the quantum of pre-judgment interest is to be calculated on the “compensation ordered herein”. The Respondents say that the amount awarded by the Court in respect of the Applicant’s annual leave entitlement is “not compensation”, and therefore it is only appropriate to calculate pre-judgment interest on the sum of $157,693.38 (pursuant to s545 of the FW Act) for the breaches of the FW Act. On that basis, the Respondents seek orders that the quantum of pre-judgment interest to be paid to the Applicant be the sum of $21,262.25.
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.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment of Judge McNab. Associate:
Dated: 24 May 2021
0