| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : DIAZ -v- SCHLUMBERGER AUSTRALIA PTY LTD [No 2] [2011] WADC 135 CORAM : WAGER DCJ HEARD : 1 AUGUST 2011 DELIVERED : 30 AUGUST 2011 FILE NO/S : CIV 467 of 2010 BETWEEN : HERMITANIO DIAZ Plaintiff
AND
SCHLUMBERGER AUSTRALIA PTY LTD
Defendant
Catchwords: Appeal - Pleadings - Application to strike out statement of claim - Application for extension of time Legislation: District Court Rules 2005
Fair Work Act 2009 (Cth)
(Page 2)
Result: Extension of time within which to appeal refused
Paragraphs 4 9 of the plaintiff's substituted statement of claim struck out
Substituted statement of claim struck out
Judgment entered for the defendant Representation: Counsel:
Plaintiff : Mr D Stewart
Defendant : Mr C P K Russell
Solicitors:
Plaintiff : Chapmans
Defendant : Mallesons Stephen Jaques
Case(s) referred to in judgment(s):
Bednall v Wesley College [2005] WASC 101
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Hazart Pty Ltd v Rademaker (1993) 11 WAR 26
Johnson v Unisys Ltd [2003] 1 AC 518
Kimberley Downs Pty Ltd v Western Australia (Unreported, WASC, Library No 6414, 25 August 1986)
RoganGardiner and Woolworths Ltd [No 2] [2010] WASC 290
Unmack & Unmack v White [2009] WADC 7
(Page 3)
1 WAGER DCJ: This is an appeal against the decision of Deputy Registrar Harman, dated 28 February 2011, to strike out pars 4 - 9 inclusive of the substituted statement of claim dated 2 September 2010 and, as a consequence, to strike out the substituted statement of claim.
2 The appeal, being an appeal from the decision of a registrar, is a complete review of the matter de novo: Hazart Pty Ltd v Rademaker (1993) 11 WAR 26, 28 (Malcolm CJ). The appeal was filed on 16 March 2011, seven days after the expiration of the 10-day limit set by r 15(2) of the District Court Rules 2005. On 19 April 2011 Deputy Registrar Harman ordered that the plaintiff file within 14 days an affidavit in support of the application to appeal out of time. The plaintiff has not filed an affidavit providing an explanation relevant to the application. 3 The defendant submits that an extension of time should not be granted because the plaintiff has had sufficient opportunity to plead his claim having filed documents late and having had his statement of claim struck out on three previous occasions. The defendant notes that on the third occasion, when Deputy Registrar Harman struck out the plaintiff's further amended statement of claim dated 19 May 2010 on the grounds that it was embarrassing, the deputy registrar granted leave for the plaintiff to submit the fourth substituted statement of claim within 14 days. The plaintiff did not file or serve the fourth substituted statement of claim (the subject of this appeal) until 43 days after the order and the plaintiff filed the document without leave of the court. 4 The defendant also submits that the cumulative effect of the various time delays is such that the defendant has suffered prejudice and that the conduct of the plaintiff has placed strain on the defendant. 5 In Unmack & Unmack v White [2009] WADC 7 Bowden DCJ considered the factors relevant to the exercise of judicial discretion in respect of an extension of time under r 15(2). I adopt the summary of Bowden DCJ as set out in [4] - [6] as being the factors for consideration in the present case. These considerations are: The discretion to extend time is given for the purpose of enabling the Court to do justice between the parties. The discretion can only be exercised upon proof that strict compliance will work an injustice upon the applicant. It requires regard to be had to the history of proceedings, the conduct of the parties, the nature of litigation and the consequences to the parties of the grant or refusal of the application for an extension of time (Gallo v Dawson (1990) 64 ALJR 458). (Page 4)
6 Accordingly, a determination needs to be made in relation to whether the plaintiff has arguable grounds of appeal before I can determine the issue of an extension of time. 7 The plaintiff, a wire line electronics technician, was employed by the defendant on or about 23 July 2008 and had his contract terminated on 20 July 2009. The plaintiff's claim, as pleaded, is for damages for an alleged breach of the terms of contract between the plaintiff and defendant, by the defendant terminating the plaintiff's employment in breach of cl 13 and cl 14 of the contract and in breach of the implied terms of the contract. The plaintiff further pleads the defendant wrongfully terminated the contract by engaging in deceitful conduct in advising the plaintiff that the plaintiff's position had been made redundant when in fact the position was subsequently filled by another employee following the termination of the plaintiff's employment. 8 The legal principles applicable to the determination of an application to strike out proceedings were summarised in Kimberley Downs Pty Ltd v Western Australia (Unreported, WASC, Library No 6414, 25 August 1986) Staples M, Seaman Civil Procedure in WA Commentary 20.19.6: (1) The rule is intended to apply only to cases which are really not arguable and not to cases where, under the previous practice, demurrer would have been the proper course: Packhard v Transport Trading Agency Co Ltd (1912) 14 WALR 191 at 195; (2) on the application, not only must all the facts alleged in the statement of claim be accepted as true, but it must be taken for granted that on all other points the pleading is unassailable: Niven v Grant (1903) 29 VLR 102 at 106; (3) great care must be exercised to ensure that the plaintiff is not improperly deprived of his or her opportunity to have a trial of his or her case by the appointed tribunal: General Steel Industries Inc v Cmr for Railways (NSW) (1964) 112 CLR 125 at 130; (1965) ALR 636 at 639; (1964) 38 ALJR 253 at 255; BC6400590; (Page 5)
(4) the rule should not be reserved for those cases where argument is necessary to show the futility of the plaintiff's claim. Argument, even extensive argument, may be necessary to demonstrate that the plaintiff's case is so clearly untenable that it cannot succeed: General Steel Industries Inc v Cmr for Railways (NSW), above, (CLR) at 130; (ALR) at 639; ALJR at 255; (5) as a general rule a plaintiff is entitled as of right to have his or her case heard, to have the facts found and then to argue the question of law as it arises before the trial judge upon the facts as found. It is only in cases in which it can be seen from the outset that, however the facts be found, there is no basis for the legal conclusion contended for by the plaintiff that the pleading should be struck out: Dalgety Australia Ltd v Rubin (WASC Full Court, Library No 5485, 24 August 1984, unreported); (6) a court at first instance should be careful not to risk stifling the development of the law by summarily rejecting a claim where there is a reasonable possibility that, as the law develops, it will be found that a cause of action will lie: Hospitals Contribution Fund of Australia v Hunt (1983) 44 ALR 365 at 373. 9 Paragraphs 4 - 9, inclusive of the plaintiff's substituted statement of claim, are: (Page 6)
(v) That the Contract would be for a period of no less than 3 years; (vi) That the express terms in relation to the Plaintiff's termination of employment were governed by clauses 13 and 14 of the Contract; (vii) That the Defendant would comply with the principles and procedures of the Ethics Statement and Personnel Manual referred to in clause 14 of the Contract; (viii) That the Defendant would act fairly and reasonably in relation to any decision to terminate the Plaintiff's employment; (ix) That the Defendant would comply with all relevant legislation regarding the termination of the Plaintiff's employment, including but not limited to ss40-43 of the Minimum Conditions of Employment Act 199 [sic], and ss382, 378-389 and 772 of the Australian Fair Work Act 2009 and s84AA of the Workers' Compensation and Injury Management Act 1981. (x) That the Plaintiff be awarded procedural fairness and/or the Defendant had to follow fair procedures prior to any termination of the Plaintiff's employment; (xi) That prior to and at the time of the termination of the Plaintiff's employment, the Defendant would act in good faith towards the Plaintiff, and not act deceitfully and/or in a manner likely to destroy the trust and confidence between the Plaintiff and the Defendant. ("the relevant terms"). 5. On July 20, 2009 the Plaintiff had his contract of employment terminated by the Defendant. 6. The Defendant breached the relevant terms of the contract by terminating the employment of the Plaintiff for a non bona fide reason, alleging redundancy, when it knew that redundancy was not the true reason for the termination of employment.
Particulars of Breach of Contract
(a) The Defendant breached the terms of the Contract set out in paragraphs 4(vi), 4(vii), 4(viii), 4(ix), 4(x) and 4(xi) above; 7. By breaching the relevant terms, the Defendant wrongfully terminated the Plaintiff's employment contract. (Page 7)
Particulars of Wrongful Termination 10 The question of whether a pleading discloses a reasonable cause of action requires an assessment of what is required by a pleading in order to disclose a cause of action. 11 It is conceded by the plaintiff that an implied term that the defendant was to exercise good faith would not, on its own, be sufficient to disclose (Page 8)
a reasonable cause of action. The plaintiff makes this concession in light of the judgment of Hall J in RoganGardiner and Woolworths Ltd [No 2] [2010] WASC 290. Hall J discussed breach of an implied good faith term at [43] – [49]. At [125] his Honour distilled the following principles from the relevant cases referred to: 1. an employment contract will generally include an implied term that an employer will not, without reasonable and proper cause, act in a manner calculated or likely to cause serious damage to the relationship of trust and confidence between it and its employee; 2. such a term applies to conduct during the currency of the employment; 3. the term does not apply to dismissal or the manner of dismissal; 4. where an employee claims for loss on the basis of an alleged breach of the good faith term it will be necessary to prove that such loss was caused by conduct of the employer which preceded, and was independent of, any subsequent dismissal. 12 Counsel for the plaintiff submits that the particulars of the contract set out the pleadings in par 4 at pars 4(x) and 4(xi) raise that the defendant advised the plaintiff at a time prior to termination that his position was redundant and that the issue of redundancy is therefore separate from the issue of termination. 13 I do not accept this submission. Although both pars 4(x) and 4(xi) refer to procedures prior to termination, neither paragraph particularises the procedure in any way at all. There is no suggestion either in the substituted statement of claim, nor in any document that has been filed in these proceedings, that there was a prior issue between the plaintiff and the defendant in relation to redundancy, independent of the plaintiff's termination. 14 I accept that reference to a period prior to termination could possibly refer to a dealing between the plaintiff and defendant that was totally independent of the subsequent termination. However, on the material that has been filed, there is absolutely no suggestion that the two are independent of each other in this case. Further, the particulars of loss and damage pleaded are consistent with a pleading relating to termination and do not raise any issues independent of termination that could be attributable to the issue of the plaintiff suffering loss and damage as a result of redundancy being raised on an earlier occasion by the defendant (Page 9)
contrary to the implied good faith required between employer and employee. 15 I also note that the plaintiff has chosen to commence proceedings in this jurisdiction in relation to an alleged breach of his employment contract. It has been the plaintiff's choice not to proceed pursuant to the Fair Work Act 2009 (Cth) pt 3-2 – Unfair Dismissal in a specialist jurisdiction. There is no general contractual right or common law cause of action to recover financial losses arising from the unfair manner of dismissal of an employee that can be the subject of a claim in this jurisdiction: Johnson v Unisys Ltd [2003] 1 AC 518; Bednall v Wesley College [2005] WASC 101 [65]. 16 The plaintiff submits that the express terms in relation to the plaintiff's termination of employment were governed by cl 13 and cl 14 of the contract. Clause 13 of the contract expressly provide that the contract may be terminated at any time by giving one month's notice or by making a payment in lieu of notice. Clause 13 is inconsistent with the plaintiff's claim and does not provide a foundation for pars 4(v), 4(vii) and 4(viii). A term cannot be implied into a contract if it contradicts an express term: BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266. 17 The defendant further submits that the plaintiff's pleadings are embarrassing because they fail to set out clearly the material facts and particulars relied upon and do not clearly identify the issues at trial. Counsel for the defendant submits that it is impossible to read the pleading and emerge with any clear understanding of a comprehensible and legally sustainable case. Specifically, counsel for the defendant submits that: (a) par 4(v) fails to plead how or why a term of 'no less than 3 years' is to be implied into the contract; (b) par 4(vi) fails to plead how clause 14 of the contract applied to the termination of the employment; (c) par 4(ix) fails to plead why the legislative provisions regarding termination of employment are to be implied into the contract; (d) pars 6 and 7: (Page 10)
(i) fail to plead how or why the implied term of good faith was breached by the termination of the contact; (ii) fail to plead how or why cl 14 of the contract was breached by the termination; (iii) fail to plead how or why the implied term that the defendant would comply with all relevant legislation, including legislation regarding termination of employment was breached by the alleged conduct of the defendant. 18 Counsel for the plaintiff concedes that the pleadings are flawed but refers to the principles enunciated in Kimberley Downs Pty Ltd v Western Australia and submits that, in light of modern case management practices, the matter should proceed and should not be the subject of interlocutory determination. Counsel for the plaintiff submits that the plaintiff should be given one last chance to amend. I do not agree. 19 The pleadings do not disclose a reasonable cause of action. In my view the pleadings cannot be cured by allowing further amendment. The time period in which to appeal is not extended. Paragraphs 4 - 9 of the plaintiff's substituted statement of claim dated 2 September 2010 will be struck out and, in consequence, the substituted statement of claim will be struck out. Judgment in this action is accordingly entered for the defendant.
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