Fair Work Ombudsman v Daladontics (VIC.) Pty Ltd

[2014] FCCA 950

FEDERAL CIRCUIT COURT OF AUSTRALIA

FAIR WORK OMBUDSMAN v DALADONTICS (VIC.) PTY LTD [2014] FCCA 950

Catchwords:
INDUSTRIAL LAW – Undefended – default judgment – contraventions of s.716(5) of the Fair Work Act 2009 (Cth) – proceedings adjourned for penalty hearing.

Legislation:

Fair Work Act 2009 (Cth), ss.14, 539, 545(1), 716(1), 716(2), 716(3), 716(5)

Federal Circuit Court Rules 2001, rr.4.03, 6.01, 13.03A, 13.03A(2), 13.03B, 13.03B(2)(c), 13.03C(2)

Arthur v Vaupotic Investments Pty Ltd [2005] FCA 433
Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd (2006) 236 ALR 665
Australian Competition and Consumer Commission v Yellow Page Marketing BV(No 2) [2011] FCA 352

Applicant: FAIR WORK OMBUDSMAN

Respondent: DALADONTICS (VIC.) PTY LTD
(ACN 006 716 310)

File Number: MLG 2299 of 2013

Judgment of: Judge Hartnett

Hearing date: 30 April 2014

Delivered at: Melbourne

Delivered on: 30 April 2014

REPRESENTATION

Counsel for the  Applicant: Ms Baillie

Solicitors for the  Applicant: Office of the Fair Work Ombudsman

The Respondent: No appearance

THE COURT DECLARES THAT:

1. Upon the admissions which the Respondent is taken to have made, consequent upon default by the Respondent pursuant to rule 13.03A(2) of the Federal Circuit Court Rules 2001 (Cth) (‘the FCC Rules’), the Court declares that:-

   (a)the Respondent contravened s.716(5) of the Fair Work Act 2009 (Cth) (‘the FW Act’) by:-

   (i)failing to comply with a Compliance Notice dated 15 October 2013 and requiring the Respondent to pay Ms Huynh Xuan Thao Tran (‘Ms Tran’) the amount of $5,405.09 (gross) within 14 days; and

   (ii)failing to comply with a Compliance Notice dated 15 October 2013 and requiring the Respondent to pay Mr John Iepema (‘Mr Iepema’) the amount of $3,940.80 (gross) within 14 days.

THE COURT ORDERS ON AN UNDEFENDED BASIS THAT:

1. Pursuant to s.545(2) of the FW Act, the Respondent pay:-

   (a)Ms Tran the amount of $5,405.09 (gross); and

   (b)Mr Iepema the amount of $3,940.80 (gross);

   within 28 days of the date of this Order.

2. Pursuant to s.547 of the FW Act, the Respondent pay interest on the sums referred to in order 2 above.

3. Pursuant to s.559(1) of the FW Act that, in the event the Respondent is unable to locate Ms Tran or Mr Iepema, the Respondent pay the amounts due to Ms Tran or Mr Iepema under these Orders into the Consolidated Revenue of the Commonwealth, within a further seven days.

4. The Applicant is to file and serve any evidence and submissions on which it seeks to rely in respect of penalty on or before 30 September 2014.

5. The Respondent is to file and serve any evidence and submissions on which it seeks to rely in respect of penalty on or before 17 October 2014.

6. The Applicant is to file and serve any evidence and submissions in reply on or before 24 October 2014.

7. The matter be adjourned to 31 October 2014 at 10am with respect to the Applicant's claim for penalties to be imposed upon the Respondent.

8. The parties have liberty to apply.

9. There is leave to the Applicant to amend paragraphs 14 and 23(b) of the Statement of Claim filed 20 December 2013 such that instead of reading “$3,940.90” they will read “$3,940.80”.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 2299 of 2013

FAIR WORK OMBUDSMAN

Applicant

And

DALADONTICS (VIC.) PTY LTD
(ACN 006 716 310)

Respondent

REASONS FOR JUDGMENT

(Edited ex tempore reasons)

1. The Applicant filed an Application in a Case on 14 April 2014 seeking that the Court make orders in terms which the Court does this day. Essentially, the making of such Orders is the entering of a default judgment for the Applicant against the Respondent pursuant to r.13.03B(2)(c) of the Federal Circuit Court Rules 2001 (Cth) (‘the FCC Rules’). The evidence supporting that application is as set out in the Affidavit of Stephen Marriott affirmed 11 April 2014 and the Affidavit of Kathleen Ben Yair affirmed 6 March 2014.

2. These proceedings commenced with the Applicant filing an Application and Statement of Claim on 20 December 2013.  The matter first came before the Court on 12 March 2014 and, at that time, there was no appearance by or on behalf of the Respondent.  The Court was satisfied, pursuant to the Affidavit of Service of Kathleen Ben Yair, that service had been effected upon Mr John Parra, a director and secretary of the Respondent company on 20 January 2014.

3. On 12 March 2014, the Court ordered, amongst other orders, that the Respondent file a notice of address for service by 26 March 2014 and that the Respondent file a response and any defence by 26 March 2014.  The matter next proceeded before the Court on 22 April 2014 when, again, there was no appearance by or on behalf of the Respondent.  At that time, the Respondent had failed to comply with the Orders of 12 March 2014 and to this day continues to fail to comply with such Orders.

4. On 22 April 2014, the Court ordered as follows:-

   “1. The Application in a Case filed 16 April 2014 is adjourned to 30 April 2014 at 10.00am for hearing on an undefended basis in the event the Respondent fails to comply with the earlier Orders of the Court made 12 March 2014 and fails to attend the adjourned hearing.

   2. Service of this Order upon the Respondent be to Unit 41, Level 4, 15 Collins Street Melbourne in the State of Victoria, and by the solicitors for the Applicant, by express post.”

5. The Court is satisfied, this day, that service was effected in accordance with the Orders made 22 April 2014 and an Affidavit to that effect has been sworn by Caitlin Elizabeth Baillie affirmed on 29 April 2014.  The Court had previously been satisfied as to service of the Application in a Case filed 14 April 2014 and supporting evidentiary documents by reference to the Affidavit of Service of Kathleen Ben Yair sworn 17 April 2014, deposing to personal service upon Mr John Parra on 16 April 2014.

6. There was no appearance by or on behalf of the Respondent at the hearing this day and the matter proceeded on an undefended basis.  The evidence before the Court indicates that attempts to contact and communicate with the Respondent have been numerous, as initiated by the Applicant, and that throughout and continuing the Respondent has failed to participate at all in these proceedings. 

7. These proceedings concern alleged contraventions of s.716(5) of the Fair Work Act 2009 (Cth) (‘the FW Act’). The Applicant alleges that the Respondent failed to comply with two compliance notices given to the Respondent in accordance with s.716(2) of the FW Act being:-

   a)a Compliance Notice dated 15 October 2013 requiring the Respondent to pay Ms Tran the amount of $5,405.09 (gross) within 14 days; and

   b)a Compliance Notice dated 15 October 2013 requiring the Respondent to pay Mr John Iepema the amount of $3,940.80 (gross) within 14 days.

8. Rule 13.03B(2)(c) of the FCC Rules provides for the Court to give judgment against the Respondent in these proceedings. The proceedings were commenced by an Application supported by a Statement of Claim for the relief that:-

   a)the Applicant appears entitled to, on the Statement of Claim;  and

   b)the Court is satisfied it has the power to grant.

   There is no requirement for proof by way of evidence of the Applicant’s claim.[1] Where discretionary relief is claimed, the Court may receive evidence relevant to the exercise of its discretion.[2]

   [1] Arthur v Vaupotic Investments Pty Ltd [2005] FCA 433 [3]; Australian Competition and Consumer Commission v Yellow Page Marketing BV (No 2) [2011] FCA 352 [14].

   [2] Australian Competition and Consumer Commission v Yellow Page Marketing BV (No 2) [2011] FCA 352 [61]-[63].

9. Rule 13.03A(2) of the FCC Rules provides that a Respondent will be in default for the purposes of r.13.03B if the Respondent:-

   “…

   (a) has not satisfied the applicant's claim; and

   (b) fails to:

   (i) give an address for service before the time for the respondent to give an address has expired; or

   (ii) file a response before the time for the respondent to file a response has expired; or

   (iii) comply with an order of the Court in the proceeding; or

   (iv) file and serve a document required under these Rules; or

   (v) produce a document as required by Part 14; or

   (vi) do any act required to be done by these Rules; or

   (vii) defend the proceeding with due diligence.”

10. Further, r.13.03C(2) of the FCC rules provides that:-

    “If a party to a proceeding is absent from a hearing, the Court may also make an order of the kind mentioned in subrule 13.03B(1), (2) or (4), or any other order, or may give any directions, and specify any consequences for non-compliance with the order, that the Court thinks just.”

11. It is established that the Respondent has complied with none of the rules of the Court in respect to the filing and serving of a notice of address for service and a response, nor has the Respondent complied with the orders of the Court requiring it to file and serve an address for service, a response and any defence.  Further, the Respondent has failed to attend any of the court hearings and, in particular, the court hearing this day in respect of the default judgment application.

12. The Court is satisfied, on the basis of the evidence before it, that the Respondent is in default as defined by r.13.03A of the FCC Rules and as submitted by Counsel for the Applicant in that it:-

    a)has not satisfied the Applicant’s claim and, in particular, has not paid Ms Tran or Mr Iepema the amounts in total, or at all, as required to be paid by the compliance notices; 

    b)has not given an address for service as required by r.6.01 of the FCC rules;

    c)has not filed a response within 14 days of being served with the proceedings in accordance with r.4.03 of the FCC Rules;

    d)has not complied with the Order made 12 March 2014 requiring a notice of address for service, a response and any defence to be filed by 26 March 2014; and

    e)has not contacted either the Applicant or the Court to seek additional time to take any steps or to seek advice or legal representation.

    The Respondent has failed to defend the proceedings with due diligence or at all. The Court is also able to make a default judgment pursuant to r.13.03C(2) of the FCC Rules in light of the Respondent’s failure to attend the hearing.

13. The application sets out the form of orders and declarations that are sought by the Applicant, including wording acknowledging that the declarations are made based on deemed admissions.  The declarations as sought by the Applicant concisely identify the contravening conduct.  The Court, in the exercise of its discretionary power, will make the declarations as sought.  The Applicant submits that there will be utility in the making of such declarations because they clearly identify the contravening conduct and because there is a public interest element in making the declarations sought.  Further, the making of such declarations would mark the Court’s disapproval of the contravening conduct.[3]

    [3] Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd (2006) 236 ALR 665 [63]; Australian Competition and Consumer Commission v Yellow Page Marketing BV(No 2) [2011] FCA 352 [69].

14. The factual background to the alleged contraventions of the FW Act is as set out in the Statement of Claim filed 20 December 2013:-

    a)the Respondent is, and was, a national system employer within the meaning of s.14 of the FW Act and operates a business specialising in orthodontic services. At all relevant times, it was the employer of Ms Tran and Mr Iepema. After conducting an investigation into Ms Tran and Mr Iepema’s employment with the Respondent, Fair Work Inspector Kerryn Shacklock (“Inspector Shacklock’) formed a reasonable belief within the meaning of s.716(1) of the FW Act that the Respondent had contravened the terms of:-

    i)the Manufacturing and Associated Industries and Occupations Award 2010 in respect of Ms Tran and Mr Iepema;  and

    ii)the National Employment Standards in the FW Act in respect of Ms Tran.

    b)On 15 October 2013, Inspector Shacklock served the compliance notices on the Respondent by handing the compliance notices to Mr Parra at the registered business of the Respondent. The compliance notices adhered to the requirements of s.716(3) of the FW Act. They required a payment by the Respondent to each of its employees in respect of non-payment of wages, and proof to Inspector Shacklock that the necessary payments had been made.

    c)The Respondent did not make an application for a review of the compliance notices to an eligible court within 14 days of being given such notices and has not since made any review application.  The Respondent did not make any payments to Ms Tran or Mr Iepema within the 14 days of being given the compliance notices and has not since made any payments to either employee, save that in submissions made this day, Counsel for the Applicant suggested that Ms Tran may have received some of the payment due to her under the Compliance Notice.

15. Such facts give rise to two separate contraventions by the Respondent of s.716(5) of the FW Act as a result of its failure to comply with the two compliance notices. Subsection 716(5) of the FW Act is a civil remedy provision for the purposes of s.539 of the FW Act. Section 539 enables an inspector to apply to the Court for orders in relation to contraventions of a civil remedy provision. The Applicant is an inspector for the purposes of the FW Act and has standing to bring the proceeding.

16. Pursuant to s.545(1) of the FW Act, the Court may make any order it considers appropriate if it is satisfied that a person has contravened a civil remedy provision. The orders which the Court makes this day are founded in such section.

I certify that the preceding sixteen (16) paragraphs are a true copy of the reasons for judgment of Judge Hartnett

Associate: 

Date: 2 June 2014