Elizabeth Murphy v Jag Automotive Transport Services Pty Ltd

[2014] FWC 2492

[2014] FWC 2492

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Elizabeth Murphy
v
Jag Automotive Transport Services Pty Ltd
(U2013/15782)

DEPUTY PRESIDENT GOOLEY MELBOURNE, 14 APRIL 2014

Application for relief from unfair dismissal - costs application dismissed.

[1] Jag Automotive Transport Services Pty Ltd (Jag) has applied for cost against Ms Elizabeth Murphy.

[2] Ms Murphy lodged an unfair dismissal application alleging that Jag had unfairly dismissed her. Jag denied dismissing Ms Murphy and submitted that Ms Murphy was not a person protected from unfair dismissal.

[3] However, that issue was never determined because Ms Murphy discontinued her application.

[4] The parties agreed that the application for costs could be dealt with on the papers.

Background

[5] After an unsuccessful conciliation, Ms Murphy and Jag were directed to file material by 19 February 2014. On 18 February 2014, Ms Murphy discontinued her application.

[6] Mr Graeme Murphy and Ms Murphy were married but had separated when these events occurred. Mr Murphy is the sole director of Jag. Jag pays a management fee to Erina Transport Services (ETS). ETS is a partnership between Mr Murphy and Ms Murphy. Mr Murphy and Ms Murphy own jointly L&G Transport Services Pty Ltd which also receives income from Jag.

[7] Mr Murphy attested to the fact that because both he and Ms Murphy worked in the business driving buses both he and Ms Murphy were placed on the payroll of Jag and received $500 per week gross so that they could be covered for Workers Compensation.

[8] It was his evidence that Ms Murphy was paid whether she worked or not and he could not have dismissed her. As Mr Murphy was the sole owner and director of Jag no submissions were made that would have enabled the Fair Work Commission (the Commission) to find that Mr Murphy could not dismiss Ms Murphy.

[9] In her submissions opposing the costs application, Ms Murphy described herself as a part owner of Jag. On documents filed in the Family Court she deposed that she had an interest in Jag. On what basis she made those claims is not clear on the material before me.

[10] Ms Murphy said that she been driving buses for Jag without a day off. She said she received a text message from Mr Murphy on 22 October 2013 telling her that her employment had been terminated immediately. She says that after she lodged her claim she was told that she did not have a case because she was not an employee but a partner of the company. She did not say when she got that advice.

[11] In Ms Murphy’s advice that she was discontinuing her application, she said she was doing so because she did not have the time and energy to go ahead with her claim. In her submissions she said that she had obtained a full time job and did not want to take time off work to attend court.

[12] It is not contested that from October 2013 Ms Murphy and Mr Murphy were involved in litigation arising from the breakdown of the marriage and business arrangement.

[13] Section 611 of the Fair Work Act 2009 (the FW Act) provides the Commission with the power to award costs in certain circumstances:

“611 Costs

(1) A person must bear the person’s own costs in relation to a matter before FWA.

(2) However, FWA may order a person (the first person) to bear some or all of the costs of another person in relation to an application to FWA if:

(a) FWA is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) FWA is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.

Note: FWA can also order costs under sections 376, 401 and 780.

(3) A person to whom an order for costs applies must not contravene a term of the order.”

[14] It was submitted that Ms Murphy’s claim was vexatious or it should have reasonably been apparent to her that she had no reasonable prospects of success either when she lodged her application or when Jag lodged its jurisdictional objection.

[15] It was submitted that Ms Murphy commenced the proceedings for an ulterior motive.

[16] There was no evidence put forward that supports this contention. Jag wants me to infer an ulterior motive to Ms Murphy because the matrimonial split up was acrimonious. I am not willing, without more, to make such an inference.

[17] It was also submitted that Ms Murphy bought her claim without reasonable cause because she was aware that she was a partner in the business. There is no doubt that Ms Murphy was a partner in ETS and that she received partnership income from ETS. However her unfair dismissal claim was not against ETS, it was against Jag.

[18] On Mr Murphy’s own evidence, he and Ms Murphy worked in Jag’s business and were put on the payroll. Unlike Mr Murphy, Ms Murphy was not a director or a shareholder of Jag.

[19] I do not accept that, given the complexity of the business arrangements, that Ms Murphy knew she was not an employee of Jag and bought her claim without reasonable cause.

[20] For the same reason I do not accept that once Jag filed its jurisdictional objection that Ms Murphy should have been aware that she had no reasonable prospect of success. The objection filed by Jag asserts, without explanation, that Ms Murphy is an equal partner in a business which is made up of a number of entities. It did not clearly state how it contended that Ms Murphy was not an employee of Jag given she was not a director or shareholder of Jag and she performed bus driving work for Jag and was on the books for workers compensation purposes and she was paid a weekly amount by the business.

[21] I am therefore not satisfied that Ms Murphy brought her claim vexatiously or that her claim had no reasonable prospects of success and therefore the application for costs is dismissed.

DEPUTY PRESIDENT

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