Construction, Forestry, Maritime, Mining and Energy Union v Abseal Pty Ltd

[2021] FCA 1513

FEDERAL COURT OF AUSTRALIA

Construction, Forestry, Maritime, Mining and Energy Union v Abseal Pty Ltd [2021] FCA 1513  

File number:

VID 401 of 2020

Judgment of:

SNADEN J

Date of judgment:

2 December 2021

Catchwords:

PRACTICE AND PROCEDURE – interlocutory application – parties entered into an agreement in settlement of the proceeding – settlement agreement required the payment of moneys – respondents defaulted on payment obligations – applicant sought orders requiring respondents to pay outstanding amounts – court’s jurisdiction to enforce the settlement agreement – relief sought final in nature – relief granted

Legislation:

Fair Work Act 2009 (Cth) s 50

Federal Court of Australia Act 1976 (Cth) s 51A

Cases cited:

Border Auto Wreckers (Wodonga) Pty Ltd v Strathdee [1997] 2 VR 49

Darling Downs Investments Pty Ltd v Ellwood (1988) 18 FCR 510

Hafertepen v Network Ten Pty Ltd [2020] FCA 1456

Macteldir Pty Ltd v Dimovski (2005) 226 ALR 773

Division:

Fair Work Division

Registry:

Victoria

National Practice Area:

Employment and Industrial Relations

Number of paragraphs:

14

Date of hearing:

29 November 2021

Counsel for the Applicant:

Mr J Hartley

Solicitor for the Applicant:

CFMMEU

Counsel for the Second Respondent:

The second respondent appeared in person

ORDERS

VID 401 of 2020

BETWEEN:

CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION

Applicant

AND:

ABSEAL PTY LTD

First Respondent

MICHAEL KOSTAL

Second Respondent

ORDER MADE BY:	SNADEN J
DATE OF ORDER:	2 DECEMBER 2021

THE COURT ORDERS THAT:

1.There be judgment for the applicant.

2.Within 30 days after service of this order, the respondents must pay (and are jointly and severally liable to pay):

(a)to Nick Warren, $11,109.11;

(b)to Justin Dredge, $6,796.36; and

(c)to Shaughan Eadie, $11,234.46.

3.Within 60 days after service of this order, the respondents must pay (and are jointly and severally liable to pay):

(a)to Nick Warren, $11,109.11;

(b)to Justin Dredge, $6,796.36; and

(c)to Shaughan Eadie, $11,234.46.

4.There be no order as to the costs of the proceeding.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

SNADEN J:

1. On 14 October 2020, the parties—together with three other individuals, Mr Nick Warren, Mr Justin Dredge and Mr Shaughan Eadie—entered into an agreement in settlement of the present matter (hereafter, the “Settlement Agreement”).  By the terms of that agreement, the respondents agreed to pay to the three non-parties certain amounts at (or before) certain times.  Those amounts were to be paid in settlement of the claims that the applicant (the “CFMMEU”) advanced in the matter on behalf of those three individuals.  Those claims concerned amounts to which it was said that they were entitled under the terms of the Abseal Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018, an enterprise agreement made and enforceable under the provisions of the Fair Work Act 2009 (Cth) (the “FW Act”).

2. The respondents are in default of the obligations that they assumed under the Settlement Agreement.  By an interlocutory application dated 12 October 2021, the CFMMEU moves the court for orders requiring the respondents to pay the amounts that they agreed to pay, together with additional amounts by way of interest.

3. The interlocutory application was brought before the court on Monday, 15 November 2021.  There was no appearance for the respondents on that day and the matter was adjourned until Monday, 29 November 2021, when it resumed.  Mr Hartley of counsel appeared for the CFMMEU.  The second respondent, Mr Kostal, appeared on his own behalf and, with the CFMMEU’s (and the court’s) consent, on behalf of the first respondent.  The hearing proceeded by video conference.

4. The CFMMEU read and relied upon four substantive affidavits, namely:

   (1)an affidavit affirmed by Justin Dredge on 20 August 2021;

   (2)an affidavit affirmed by Shaughan Eadie on 20 August 2021;

   (3)an affidavit affirmed by Nick Warren on 15 September 2021; and

   (4)an affidavit affirmed by Nicholas Grealy on 6 September 2021.

5. None of the witnesses was required for cross-examination.  That almost certainly reflects the relatively straightforward nature of the application, which the analysis below shall make clear.

6. The court’s jurisdiction to enforce the terms upon which suits before it are compromised is not in doubt:  Darling Downs Investments Pty Ltd v Ellwood (1988) 18 FCR 510, 526 (Pincus and Einfeld JJ), applied in Hafertepen v Network Ten Pty Ltd [2020] FCA 1456, [49] (Katzmann J). Here, the matter before the court concerned the respondents’ alleged failure to comply with the terms of an enterprise agreement and, thereby, their alleged contravention of s 50 of the FW Act. The enforcement of a contract made in settlement of such claims is itself part of the matter by which those claims were initially agitated in the court: Macteldir Pty Ltd v Dimovski (2005) 226 ALR 773, 789-790 [61]-[62] (Allsop J).

7. The affidavit material before the court puts the existence of the Settlement Agreement beyond doubt.  Its terms are unambiguous and there is no dispute that they are binding.  The agreement required the respondents to pay certain amounts at certain times between October 2020 and May 2021 to the three individuals on whose behalf the CFMMEU brought the matter.  Some amounts were paid but the bulk were not.  The evidence establishes (and, indeed, it was not in contest) that:

   (1)Mr Warren is yet to receive $21,448.76 of the $32,000.00 that it was agreed would be paid to him over the relevant period;

   (2)Mr Dredge is yet to receive $13,124.46 of the $20,000.00 that it was agreed would be paid to him over the relevant period; and

   (3)Mr Eadie is yet to receive $21,680.84 of the $30,000.00 that it was agreed would be paid to him over the relevant period.

8. The evidence does not disclose anything in the way of permissible excuse for those non-payments.  At the hearing of the interlocutory application, the second respondent was unable to offer anything in that regard.  Instead, he explained (from the proverbial bar table) that the respondents have been adversely affected by the COVID-19 pandemic, which has drastically reduced the first respondent’s commercial activity.  Although there is no reason to doubt what was advanced, the matter presents nonetheless as a simple example of parties to a contract having not abided the terms that were agreed.  The reasons for the default do not factor as a reason to deny the relief that is sought.  I consider that it is appropriate to grant that relief.

9. In addition to the outstanding amounts, the CFMMEU also sought orders for interest pursuant to s 51A of the Federal Court of Australia Act 1976 (Cth). Particulars of the calculations prepared in that regard were provided ahead of the interlocutory hearing. There is nothing controversial about them: they nominate a rate of 4.25 per cent up to 31 December 2020 and 4.10 per cent thereafter. Those rates reflect the application of the court’s Interest on Judgments Practice Note (GPN-INT).

10. Again, there is no obvious reason—and the respondents did not attempt to identify any reason—why orders for interest should not be made in the amounts proposed.  Such orders will be made.

11. Those matters acknowledged, it is appropriate to make orders in the form that the CFMMEU proposes, namely that the respondents pay the following amounts:

    (1)to Mr Warren, $21,448.76 plus interest of $769.46 (totalling $22,218.22);

    (2)to Mr Dredge, $13,124.46 plus interest of $468.26 (totalling $13,592.72); and

    (3)to Mr Eadie, $21.680.84 plus interest of $788.08 (totalling $22,468.92).

12. The CFMMEU appears to acknowledge the difficulties facing the respondents and has generously proposed orders that would require that the outstanding amounts be paid in two instalments over 60 days.  That timeframe will be incorporated.

13. The CFMMEU also seeks an order acknowledging that the amounts to be paid are to be paid in satisfaction of the respondents’ obligations under the Settlement Agreement; and that, once those amounts are paid, “…clause 7 of that agreement shall have effect.”  By cl 7 of the Settlement Agreement, it was agreed that the respondents would be discharged from any and all liability that they might otherwise have in connection with the matters relevantly in dispute.  An order in the terms now proposed is said to reflect that the relief that is sought is final in nature.

14. The CFMMEU submitted that that order was proposed for the respondents’ benefit.  That may be so; but I do not consider that it is necessary to make an order in those terms.  It is plain enough that the relief that is sought—and that will be granted—is final relief.  That is so notwithstanding the interlocutory nature of the application pursuant to which it will be granted (see, in that vein, Border Auto Wreckers (Wodonga) Pty Ltd v Strathdee [1997] 2 VR 49, 52 (Brooking JA, Winneke P and Tadgell JA agreeing). The relief that will be granted will resolve the matter that has arisen between the parties.  The order that the CFMMEU proposes might be read to suggest otherwise:  that is to say, might suggest that the matter will resolve not by dint of the court’s orders but by the respondents’ compliance with them.  That is not so.  Subject to rights of appeal, the relief to be granted will resolve the matter with which the court is seized.  Non-compliance, if there is any, can be addressed via the usual enforcement processes.  It suffices simply to acknowledge those realities in these reasons.  There is no need to synthesise that acknowledgment into the court’s orders.

I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Snaden.

Associate:

Dated:       2 December 2021