Construction, Forestry, Maritime, Mining and Energy Union

[2020] FWCA 5404

[2020] FWCA 5404

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.217—Enterprise agreement
s.602—Decisions of FWA

Construction, Forestry, Maritime, Mining and Energy Union
(AG2020/3002; ADM2020/16)

LININGS PTY LTD T/AS CUSTOM CEILINGS AND CFMEU ACT FINISHING AND FAÇADE TRADES ENTERPRISE AGREEMENT 2020

(ODN AG2020/2806)

Building, metal and civil construction industries
COMMISSIONER LEE	MELBOURNE, 22 OCTOBER 2020

Application for variation of the Linings Pty Ltd t/as Custom Ceilings and CFMEU ACT Finishing and Façade Trades Enterprise Agreement 2020 because of ambiguity or uncertainty – Application for a correction to a decision pursuant to s.602

[1] An application has been made by the Construction, Forestry, Maritime, Mining and Energy Union (the Applicant) for a correction to a decision pursuant to s.602 of the Fair Work Act 2009 (FW Act). The decision issued by the Commission on 29 September 2020 in [2020] FWCA 5203 (the approval decision) approved the Linings Pty Ltd t/as Custom Ceilings and CFMEU ACT Finishing and Façade Trades Enterprise Agreement 2020 (the Agreement).

[2] At the mention hearing before me on 6 October 2020, the Applicant was granted permission under s.586(b) of the FW Act to amend its application such that it is now taken to include an application under s.217 of the FW Act to vary an enterprise agreement to remove an ambiguity or uncertainty.

[3] The Applicant has raised concerns flowing from the fact that both the Agreement and approval decision refer to Linings Pty Ltd t/as Custom Ceilings as the employer. The correct name of the employer is Custom Ceilings (ACT) Pty Ltd (the Employer).

[4] The Applicant was directed to file submissions in support of the Application for the matter to then be determined on the papers without the need for a hearing.

[5] I consider it appropriate to deal with both applications concurrently in this decision.

Submissions

s.217 – Application to vary an agreement to remove an ambiguity or uncertainty

[6] It is the Applicant’s position that the Agreement refers to Linings Pty Ltd t/as Custom Ceilings as the Employer, when it should refer to Custom Ceilings (ACT) Pty Ltd. The Applicant made submissions seeking that the Commission exercise its powers under s.217 of the FW Act to vary the Agreement to resolve this uncertainty.

[7] The Applicant referred to the Decision of DP Gostencnik in Bradnam’s Windows and Doors Pty Ltd (Bradnam’s), 1 where a summary of the principles to be applied in consideration an application under s.217 were set out as follows:

“[11] As seems clear from the text of s.217, the discretion to vary an agreement may only be exercised if first the Commission is satisfied that there is ambiguity or uncertainty in the agreement. The principles that are to be applied in considering an application under s.217 may be shortly stated:

•  The Commission should approach an application in two stages. First, as a jurisdictional pre-requisite, it should identify whether there is an uncertainty or ambiguity. Secondly, if an ambiguity or uncertainty is identified, it should consider whether to exercise its discretion to vary the agreement the subject of the application; 2 

•  The process of identifying ambiguity or uncertainty involves making an objective assessment of the words used in the provisions under examination. The words used are construed having regard to their context; 3 

•  The Commission will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention; 4 

•  However, the Commission must make a positive finding that an agreement the subject of an application under s.217 is ambiguous or uncertain. Prima facie satisfaction of ambiguity or uncertainty is not sufficient; 5 

•  The mere existence of rival contentions as to the proper construction of the terms of an agreement will also be an insufficient basis to conclude the existence of ambiguity or uncertainty. Such contentions may be self-serving. The task is to make an objective judgment as to whether the wording of a provision is susceptible to more than one meaning; 6 and

•  Once an ambiguity or uncertainty has been identified, in exercising the discretion whether to vary the agreement, the Commission is to have regard to the mutual

•  of the parties at the time the agreement was made. 7”

[8] The Applicant submits that in the present matter, the uncertainty caused by the misidentification of the Employer in the text of the Agreement and the disjunction between the employer named in the Agreement and the (if corrected) approval decision, is able to be remedied by s.217.

[9] In reaching this conclusion, the Applicant submits that the Commission is entitled to consider the relationship between the approval decision and the text of the Agreement. As Deputy President Gostencnik noted in Bradnam’s,it is acceptable to consider the context of the relevant words when assessing whether uncertainty arises. Consideration of broader context in identifying uncertainty was endorsed by the Full Bench in Tenix Defence Pty Limited (Tenix) who held that:

“…. The words used are construed having regard to their context, including where appropriate the relevant parts of a related award. As Munro J observed in Re Linfox - CFMEU (CSR Timber) Enterprise Agreement 1997:

"The identification of whether or not a provision in an instrument can be said to contain an `ambiguity' requires a judgment to be made of whether, on its proper construction, the wording of the relevant provision is susceptible to more than one meaning. Essentially the task requires that the words used in the provision be construed in their context, including where appropriate the relevant parts of the `parent' award with which a complimentary provision is to be read."

[30] We agree that context is important. Section 170MD(6)(a) is not confined to the identification of a word or words of a clause which give rise to an ambiguity or uncertainty. A combination of clauses may have that effect.” 8

[10] The Applicant submits that the relationship between the approval decision and the text of the Agreement is analogous to the Tenix situation, and that the approval decision and Agreement are related documents such that one provides context for the interpretation of the other. On this approach the direct inconsistency between the two documents creates a clear ambiguity or uncertainty in relation to the coverage of the Agreement. Having identified this uncertainty, it is appropriate for the Commission to exercise its discretion to vary the Agreement in the terms sought.

[11] The Applicant furthers submits that the application to vary the Agreement to correct the name of the Employer is by consent of both the Applicant and the Employer. The Employer confirmed this consent in separate correspondence to my chambers.

[12] In relation to the question of the mutual intention of the parties at the time the Agreement was made, the Applicant submits that this can reasonably be said to support the proposed variation. This is contended on the basis that the Form F16, Form F17 and Form 18 declarations signed by both the Applicant and the Employer all refer to the correct entity such that it is reasonable to conclude that the mutual intention of the parties at the time of making the Agreement was for the Agreement to cover the correct entity, and but for inadvertence and error in the Agreement drafting process would have done so.

[13] In relation to the operative date of any variation pursuant to this application, the Applicant submits that the proposed variation should commence operation on and from the same date as the Agreement, that is 6 October 2020.

[14] Taking all of the above into account, the Applicant submits that it is appropriate for the Commission to grant the application for the variation of the Agreement pursuant to s.217 of the FW Act and allow for the variation of the Agreement, and the filing of a corrected copy of the Agreement giving effect to that variation.

s.602 – Correcting obvious errors etc. in relation to the FWC’s decisions

[15] It is the Applicant’s position that the approval decision refers to Linings Pty Ltd t/as Custom Ceilings as the Employer, when it should refer to Custom Ceilings (ACT) Pty Ltd. The Applicant submits that the decision has the effect that the Agreement will be binding on an entity which is not the Employer and seeks that the Commission exercise its power under s.602 of the FW Act to correct or amend any obvious error, defect, or irregularity (whether in substance or in form) in relation to a decision.

[16] The Applicant referred to the decision of RotoMetrics Australia Pty Ltd t/a Roto Metrics 9where the “Full Bench held the opinion that it was appropriate to allow use of s.602 in relation to errors or irregularities regarding the identity of persons bound and covered by Agreements.” In doing so, the Applicant states that the Full Bench adopted the four-part test set by Justice Munro in Re Timber and Allied Industries Award:

“•  where there has been an unintentional omission in an Order or judgement of the Court;

•  where an Order or judgment does not conform with the intention of the Court, and would have been made if the issue had been mentioned during the proceedings;

•  where there are no material differences of opinion between the parties; it is not suitable to apply this rule where it concerns a matter of controversy; and

•  where the error is manifestly clear; where an "officious bystander would reply when asked if the amendment was appropriate: `Of course'”. 10

[17] The Applicant goes further to state that in the same matter, Justice Munro held that the then s.111(q) of the Workplace Relations Act 1996 (WR Act), which is in terms which are substantially similar to s.602 of the FW Act, was intended to be a counterpart of the slip rule as applied by the courts and that:

“A perusal of the authorities in this area indicates that the slip and error rule has been employed in a number of contexts and has wide application” 11

[18] The Applicant relies on the continuing application of Justice Munro’s approach to the slip rule and s.111(1)(q) of the WR Act to the interpretation of s.602 of the FW Act, citing the Explanatory Memorandum to the Fair Work Bill as follows:

“In order to avoid unnecessary technicality, clause 602 allows FWA, on its own initiative or on application by a person, to correct or amend any obvious error, defect or irregularity in relation to a decision of FWA (including an instrument made by FWA). This clause is intended to be a statutory analogue of the ‘slip rule’ used by superior courts to correct certain errors in orders (see Re Timber and Allied Industries Award 1999 [2003] AIRC 1137 at [29]-[30]).” 12

[19] The Applicant submits that it is clear that it is permissible for the Commission to use s.602 to correct an error or irregularity in relation to the identity of the persons who are covered by the Agreement. Furthermore, that what has occurred in this matter is an irregularity within the meaning of s.602 in that it is not according to the accepted principles or rules for an agreement to have been approved in the circumstances of this matter. Furthermore, that the current circumstances meet the four-part test set by Justice Munro in Timber and Allied Industries Award.

[20] Taking this into account, the Applicant submits that is appropriate for the Commission to use s.602 in the matter sought by the Applicant to allow correction to the approval decision relating to the Agreement.

Consideration

[21] I agree with the Applicant that the principles set out by the Deputy President in Bradnam’s are the relevant principles in relation to s.217 of the FW Act and adopt and apply them to the circumstances in this matter.

[22] In the circumstances, I am satisfied that the name of the Employer currently in the Agreement creates an uncertainty which engages with s.217. I am also satisfied that I should amend the Agreement to remove the uncertainty and that it is appropriate to do so in the manner proposed.

[23] I further agree with Applicant that the principles set out by Justice Munro in Timber and Allied Industries Award are the principles that underly the statutory analogue that is s.602 of the FW Act, and I adopt and apply them to the circumstances in this matter.

[24] I am satisfied that the incorrect name of the Employer in the approval decision creates an irregularity which is amenable to correction under s.602. I am satisfied that the error should be corrected in the interests of certainty and to give effect to the intentions of the parties.

[25] On the material before the Commission, I accept that:

•  The Commission should allow for variation of the Agreement in terms as follows:

1. By deleting the words “Linings Pty Ltd t/as Custom Ceilings” where appearing on the title page of the agreement and inserting the following in lieu thereof “Custom Ceilings (ACT) Pty Ltd”.

2. By deleting the words “Linings Pty Ltd t/as Custom Ceilings” where appearing in clauses 2, 3.2, 3.7, and 68, of the agreement and inserting the following in lieu thereof “Custom Ceilings (ACT) Pty Ltd”.

•  The Commission should allow for correction to the approval decision relating to the Agreement by deleting the words “Linings Pty Ltd t/as Custom Ceilings” where appearing on the approval decision and inserting the following in lieu thereof “Custom Ceilings (ACT) Pty Ltd”.

[26] I consider it appropriate that the variation and corrected approval decision operate from the date the Agreement commenced operation, being 6 October 2020.

Conclusion

[27] In order to remove the uncertainty identified in the Agreement in accordance with s.217 of the FW Act, I propose to vary the Agreement as outlined earlier. The application is granted, and a variation order is issued separately (PR723736).

[28] In order to remove the irregularity in the approval decision in accordance with s.602 of the FW Act, I propose to correct the approval decision as outlined earlier. The application is granted, and order to correct the approval decision issued by the Commission on 29 September 2020 in [2020] FWCA 5203 issued separately (PR723743).

COMMISSIONER

 1   [2019] FWCA 979

 2   See Re Tenix Defence Systems Pty Limited Certified Agreement 2001 - 2004 (PR917548) at [28], [32] and [35]

 3   Ibid at [29]

 4   Ibid at [31]

 5   See Colnvest Ltd v Visionstream Pty Ltd (2004) 134 IR 43 at [57]

 6   See Re Civil Construction Corporation Enterprise Agreement (PR939346); SJ Higgins Pty Ltd and Others v CFMEU (PR903843); Re CFMEU Appeal (Print R2431)

 7    See Re Tenix Defence Systems Pty Ltd Certified Agreement 2001 - 2004 (PR917548) at [32]

 8   Ibid at [29]

 9   [2011] FWAFB 7214

 10   Re Timber and Allied Industries Award PR937647 at [34]

 11   Ibid at [31]

 12   Explanatory Memorandum to the Fair Work Bill 2008 at 2316

Printed by authority of the Commonwealth Government Printer

< AE509124  PR723450>