Dr Gary Berryman v Dr Kosky trading as Nagambie Medical Centre

[2010] FWA 9691

[2010] FWA 9691

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.365 - Application to deal with contraventions involving dismissal

Dr Gary Berryman
v
Dr Kosky trading as Nagambie Medical Centre
(C2010/5178)

COMMISSIONER GOOLEY MELBOURNE, 16 DECEMBER 2010

[1] Dr Gary Berryman made an application pursuant to section 365 of the Fair Work Act 2009 (“the FW Act”) alleging that his employment was terminated in breach of Part 3-1 of the FW Act.

[2] Dr Berryman’s contract with Dr Alan Kosky trading as Nagambie Medical Centre was terminated on 4 June 2010. This application was made on 8 October 2010 which was more than 60 days after Dr Berryman’s contract was terminated.

[3] The application was listed for conference on 17 November 2010 but the conference did not resolve the matter.

[4] Dr Berryman seeks an extension of time to lodge the application and it was agreed by the parties that the application should be dealt with on the papers.

[5] In accordance with the directions issued in this matter, Dr Berryman filed in support of his application the following:

1. A witness statement of Dr Gary Berryman

2. A witness statement of Mr Michael Creelman

3. Submissions

4. Submissions in reply

[6] Dr Kosky filed submissions opposing the application.

Dr Berryman’s evidence

[7] Dr Berryman’s evidence is that he was engaged by Dr Kosky in June 2008 to work as a general practitioner at Dr Kosky’s Nagambie Medical Practice. While Dr Berryman claims he was an employee he acknowledges that there was an agreement to pay him as an independent contractor. Dr Berryman did not issue invoices to Dr Kosky but received 75% of his gross billings (after adjustments) minus 25% plus GST as a service fee.

[8] In January 2010 Dr Berryman advised Dr Kosky that he required heart surgery. In May 2010 Dr Berryman complained to Dr Kosky about being underpaid and in late May 2010 Dr Kosky advised Dr Berryman that he would henceforth receive 70% of receipts. Dr Berryman’s evidence was that he did not accept this change. Dr Berryman’s evidence was that on 4 June 2010 Dr Kosky terminated his contract without notice because he questioned his pay. At the same time he was required to vacate his accommodation which was provided by Dr Kosky. Dr Berryman did not receive payment in lieu of notice.

[9] One week after the termination of his contract, Dr Berryman was advised that he would be off work for three months after his operation.

[10] Dr Berryman sought legal advice on 5 July 2010 and provided his solicitor, Mr Michael Creelman, with an unsigned copy of the contract provided to him at the commencement of his engagement with Dr Kosky. He advised his solicitor that he was not sure if he had signed the contract.

[11] Mr Creelman was to provide Dr Berryman with advice on his legal options but he advised Dr Berryman that it would be difficult to provide that advice without knowing if there was an executed contract.

[12] During July 2010, Dr Berryman and Mr Creelman both attempted, without success, to obtain a copy of the signed agreement from Dr Kosky.

[13] On 2 August 2010 Dr Berryman was admitted to hospital and had open heart surgery on 3 August 2010. He was discharged on 14 August 2010 but was readmitted on 19 August 2010 and was again discharged on 24 August 2010. He was again admitted to hospital on 28 August 2010 and was discharged on 12 September 2010. He attempted to return to work on 20 September 2010 but had a further collapse. Dr Berryman was effectively unwell for two months after his operation which affected his ability to communicate with Mr Creelman.

[14] Dr Berryman attempted to see Mr Creelman during this period but his ill health meant that he was unable to do so. He finally met with Mr Creelman and Mr Nicholas Harrington of Counsel on 7 October 2010 and was advised for the first time of the general protections provisions of the FW Act and was advised to lodge an application immediately. The application was lodged the next day.

[15] Dr Berryman’s evidence was that he was advised that he would not be able to file an unfair dismissal application as he exceeded the high income threshold but he was not, prior to 7 October 2010, made aware of his rights under Part 3-1 of the FW Act.

Mr Creelman’s evidence

[16] Mr Creelman’s evidence was that he is an accredited specialist in commercial litigation and that he had never specialised in industrial relations law or workplace relations law. He further said he had no detailed knowledge of the changes arising from the enactment of the FW Act. He said that he was not familiar with the general protections provisions in the FW Act and was not aware of the 60 day time limit for the making of a general protections application. His evidence is that in September 2010 he reviewed sections 382 and 383 of the FW Act and formed the view that Dr Berryman could not bring an unfair dismissal application because his income was greater than the high income threshold. His evidence was that he was not aware of the provisions in Part 3-1 of the FW Act until the conference with Mr Harrington on 7 October 2010.

[17] He gave evidence consistent with Dr Berryman’s evidence of the attempts made to get a copy of the contract between Dr Berryman and Dr Kosky. It was not until 11 August 2010 that the solicitors for Dr Kosky advised Mr Creelman of their client’s view that Dr Berryman was an independent contractor.

[18] Mr Creelman also gave evidence of the impact of Dr Berryman’s illness on the conduct of the matter.

Dr Kosky’s evidence

[19] No evidence was filed by Dr Kosky nor was there any challenge to the evidence of Dr Berryman or Mr Creelman. While it was agreed that the matter would be dealt with on the papers there was no subsequent request to have the witnesses available for cross examination. I therefore accept the evidence of Dr Berryman’s witnesses.

The statutory considerations

[20] In deciding whether to grant an extension of time I must be satisfied that there are exceptional circumstances taking into account:

(a) the reason for the delay;

[21] Dr Berryman relies upon representative error and Dr Berryman’s medical condition.

[22] The 60 day time period for lodging the application expired on the day Dr Berryman had open heart surgery. The failure of his legal representative to be aware of the general protections provisions in the FW Act meant that he was not aware of either the protections afforded to employees by Part 3-1 of the FW Act nor the 60 day limitation period.

[23] Further Dr Berryman’s submission suggests that the refusal of Dr Kosky to provide a copy of Dr Berryman’s contract impacted on Mr Creelman’s ability to provide advice to Dr Berryman. However even if a copy of the contract had been provided, given Mr Creelman’s own evidence he did not know about the provisions in Part 3-1 of the FW Act, it is unclear how the provision of the signed contract or a statement from Dr Kosky that no such document existed would have affected his advice.

[24] It appears that the lack of a signed contract or even advice that no such contract existed caused Mr Creelman to delay seeking advice from Counsel experienced in work place law. In this no blame can be attributed to Dr Berryman.

[25] The delay in filing the application was clearly further caused by Dr Berryman’s significant health problems.

[26] Dr Kosky did not file any evidentiary material in this matter. He did however respond to the evidence of Dr Berryman. He pointed to the lack of evidence from Dr Berryman and Mr Creelman about why no advice was sought from counsel immediately. Had Counsel been consulted in July then advice about the general protections provisions would have been provided within the limitation period. Further Dr Kosky submitted that a brief search of the Fair Work Australia website would have alerted Dr Berryman and his solicitor of the general protections provisions of the FW Act as well as the 60 day limit.

[27] Dr Kosky further submits that despite Dr Berryman’s illness, his legal representative could have filed an application under section 365 of the FW Act.

[28] Further Dr Kosky submits that if the Tribunal finds representative error Dr Berryman can seek redress against his solicitor.

(b) any action taken by the person to dispute the dismissal;

[29] Dr Kosky made no submissions on this.

[30] Dr Berryman disputed his dismissal on the day of his dismissal and he sought a copy of this contract from 20 July 2010. On 28 July 2010 Dr Kosky was aware that Dr Berryman was seeking legal advice about his employment.

(c) prejudice the employer (including prejudice caused by the delay);

[31] Dr Kosky does not point to any prejudice to the employer and Dr Berryman submits that there is no prejudice to the employer.

(d) merits of the application;

[32] Dr Kosky made no submissions on the merits of the application though it may be assumed that he considers that the application, so far as it alleges adverse action against an employee, must fail, as he submits that Dr Berryman was at all times an independent contractor. Further Dr Kosky denied in the Form F8A lodged with Fair Work Australia that the termination of the contract was because of Dr Berryman’s disability.

[33] Dr Berryman submits that there is little doubt that he was an employee and therefore entitled to the protections afforded by the FW Act.

[34] Dr Berryman submits that given the lack of evidence and the lack of challenge by Dr Kosky to the evidence of Dr Berryman that Dr Kosky cannot and does not make submissions that the application is without, or lacks, merit.

[35] It is not possible on the evidence before me to determine if Dr Berryman is an employee or an independent contractor. It is not possible to determine if Dr Berryman’s disability or complaint about his employment was a reason for the termination of his contact. However it is clear on the material before me that if Dr Berryman’s evidence is accepted the application has merit.

(e) fairness as between the person and other persons in a like position.

[36] Dr Kosky submits it would be unfair to other applicants or potential applicants for an extension to be granted to Dr Berryman in this case. I am not sure what is intended by this submission. Decisions to grant or reject applications for extensions of time are considered on the merits of each case having regarded to the statutory requirements. Clearly it would be unfair if an application to grant an extension of time were given in circumstances not contemplated by the FW Act.

Other matters

[37] Dr Kosky submits that I should have regard to the fact that Dr Berryman has other legal remedies against Dr Kosky and a potential negligence claim against his solicitor. Dr Berryman submits that if the application to extend time is not granted then Dr Berryman is excluded from litigating any statutory cause of action under the FW Act.

Conclusion

[38] To grant an extension of time I must be satisfied that there are exceptional circumstances taking into account the factors set out above.

[39] The term ‘exceptional’ has been considered in a number of decisions of Fair Work Australia. The Full Bench in Cheval Properties Pty Ltd t/as Penrith Hotel Motel v Smithers 1 found that:

[t]he word “exceptional” is relevantly defined in The Macquarie Dictionary as “forming an exception or unusual instance; unusual; extraordinary.” We can apprehend no reason for giving the word a meaning other than its ordinary meaning for the purposes of s.394(3) of the FW Act. 2

[40] Representative error was considered by a Full Bench of the AIRC in Clark v Ringwood Private Hospital. 3In that matter, on the question of representative error, the Full Bench found that

The following general propositions should be taken into account in deciding whether or not representative error constitutes an acceptable explanation for the delay:

(1) Depending on the circumstances, representative error may be a sufficient reason to extend time within which an application for relief may be lodged.

(2) A distinction should be drawn between delay properly apportioned to an applicant’s representative where the applicant is blameless and delay occasioned by the conduct of the applicant.

(3) The conduct of the applicant is a central consideration in deciding whether representative error provides an acceptable explanation for the delay in filing the application. For example it would generally not be unfair to refuse to accept an application which is some months out of time in circumstances where the applicant left the matter in the hands of their representative and took no steps to inquire as to the status of their claim. A different situation exists where an applicant gives clear instructions to their representative to lodge an application and the representative fails to carry out those instructions, through no fault of the applicant and despite the applicant’s efforts to ensure that the claim is lodged.

(4) Error by an applicant’s representatives is only one of a number of factors to be considered in deciding whether or not an out of time application should be accepted

[41] I accept that representative error, for which Dr Berryman cannot be blamed, was one of the reasons for the failure to lodge the application by the due date.

[42] Legal practitioners who are asked to advise in areas which are not their area of speciality should seek advice promptly from those with the expertise or advise their client that they can only provide advice in their area of expertise and refer their client to those who have the expertise. This did not occur in this case, but Dr Berryman cannot be held responsible for this.

[43] The subsequent delay in lodging the application is attributable to Dr Berryman’s serious illness and it cannot be expected that Mr Creelman should have acted during this time without Dr Berryman’s instructions.

[44] It is because of this combination of factors, along with the lack of prejudice to the employer and the lack of challenge to the merits of the application that I have decided that there are exceptional circumstances which warrant the granting of an extension of time.

[45] As a conference in accordance with section 368 of the FW Act has already been conducted and the matter was not resolved a certificate pursuant to section 369 of the FW Act will be issued.

COMMISSIONER

 1   [2010] FWAFB 7251 (17 September 2010).

 2   Ibid at [5].

 3   AIRC Print P5279 (22 September 1997).

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