FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Fair Work Ombudsman v L.E.C Builders & Designers Pty Ltd [2022] FedCFamC2G 96
File number(s): MLG 568 of 2021 Judgment of: JUDGE O'SULLIVAN Date of judgment: 16 February 2022 Catchwords: INDUSTRIAL LAW – Application for declarations and orders as a result of underpayments and breaches of applicable award – breach of a civil remedy provision – application for default judgment – default by first and second respondents – orders made on default by respondents. Legislation: Fair Work Act 2009 (Cth), ss.550, 545, 546, 547, 716
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021, rr.13.04, 13.05
Building and Construction Industry General On-site Award 2010Cases cited: Rathner, in the matter of Mildura Grand Pty Ltd (in liq) v Bendigo Skyrider Pty Ltd [2011] FCA 626
Macquarie Bank Limited v Seagle [2005] FCA 1239
Macquarie Bank Limited v Seagle [2008] FCA 1417
Australian Competition and Consumer Commission v Dataline.Net.Au Pty Limited [2006] FCA 1427
Speedo Holdings B.V. v Evans (No 2) [2011] FCA 1227Division: Division 2 General Federal Law Number of paragraphs: 24 Date of hearing: 16 February 2022 Place: Melbourne (via Microsoft Teams) Counsel for the Applicant: Ms Sears Solicitor for the Applicant: Fair Work Ombudsman Appearance for the First Respondent: No appearance Appearance for the Second Respondent: No appearance ORDERS
MLG 568 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: FAIR WORK OMBUDSMAN
Applicant
AND: L.E.C BUILDERS & DESIGNERS PTY LTD
First Respondent
LUKE JOHN ELLIOT
Second Respondent
ORDER MADE BY:
JUDGE O'SULLIVAN
DATE OF ORDER:
16 FEBRUARY 2022
THE COURT ORDERS THAT:
1.Pursuant to Rules 13.05(2)(c) and 13.06(1)(e) of the Federal Circuit and Family Court of Australia (Division 2) (General Law) Rules 2021 (‘the Rules’), the applicant have leave to proceed on an undefended basis for default judgment this day.
THE COURT DECLARES THAT:
2.Upon the admissions which the Respondents are taken to have made, consequent upon default by the Respondents pursuant to Rule 13.04(2) of the Rules that:
(a)the First Respondent contravened section 716(5) of the Fair Work Act 2009 (‘the FW Act’) by failing to comply with the Compliance Notice dated 12 December 2020; and
(b)the Second Respondent was involved, within the meaning of section 550(2)(c) of the FW Act, in the First Respondent’s contravention of section 716(5) of the FW Act by failing to comply with the Compliance Notice.
THE COURT ORDERS THAT:
3.Pursuant to s.545(1) of the FW Act, the First Respondent take the steps that were required by the Compliance Notice within 28 days of this order, by:
(a)calculating and paying to Brian Wilson (Employee) the outstanding entitlements it was required to pay under the Compliance Notice (‘Outstanding Entitlements’);
(b)calculating and paying to the chosen Superannuation Fund of the Employee the additional superannuation contributions it was required to pay under the Compliance Notice;
(c)preparing and producing to the Applicant a schedule outlining its calculation of the Outstanding Entitlements and additional superannuation contributions;…
Keep reading for free
Create a free CaseChat account to read Fair Work Ombudsman v L.E.C Builders & Designers Pty Ltd and more:
- Read every judgment in full
- Ask AI and get answers linked to paragraphs
- See how each paragraph was cited in later cases
- Download judgments as PDF or Word
One click creates your free account or signs you in.
By continuing you agree to the Terms and Privacy Policy.
Details
- Case
- [2022] FedCFamC2G 96
- Decision Date
CaseChat Overview and Summary
The case of Fair Work Ombudsman v L.E.C Builders & Designers Pty Ltd involved the Fair Work Ombudsman as the applicant seeking to enforce compliance with the Fair Work Act 2009 (FW Act) against the first respondent, L.E.C Builders & Designers Pty Ltd, and its sole director, the second respondent. The case centred on allegations that the first respondent had failed to comply with a compliance notice issued under section 716 of the FW Act, resulting in underpayment of entitlements to an employee, Mr Brian Wilson. The court proceedings were initiated on 29 October 2021, and the matter was set for hearing on 16 February 2022. Both respondents failed to appear, leading the applicant to seek default judgment against them.
The primary legal issues the court needed to decide included whether the preconditions for granting a default judgment under Rule 13.05(2) of the Federal Circuit and Family Court of Australia (Division 2) (General Law) Rules 2021 (FCFCOA Rules) were satisfied, and whether the applicant's statement of claim adequately supported the relief sought. The court had to consider whether the respondents were indeed in default, as defined under Rule 13.04(2) of the FCFCOA Rules, by virtue of their failure to attend court or file a response. Additionally, the court examined the sufficiency of the statement of claim to establish a reasonable cause of action supporting the relief requested by the applicant.
The court found that the respondents were in default as they had neither appeared nor filed a response, thereby satisfying the conditions for a default judgment under Rule 13.05(2)(c) of the FCFCOA Rules. The court noted that while Rule 13.05(2)(c) does not require proof of the claim by evidence, the statement of claim must present a claim for relief on its face and plead at least one reasonable cause of action. The applicant's statement of claim was deemed sufficient as it detailed the statutory contraventions and the relief sought. The court also considered the principles formulated under the old Federal Court Rules, including the permissible use of relevant evidence and the discretion to refuse a default judgment even when the preconditions are met. Ultimately, the court granted the applicant's application for default judgment and the consequential orders as sought.
In summary, the court granted the Fair Work Ombudsman's application for default judgment against the respondents, L.E.C Builders & Designers Pty Ltd and its sole director. The judgment declared the respondents' contraventions of the Fair Work Act and ordered them to pay outstanding entitlements, interest, and pecuniary penalties as specified. The court retained discretion to further order any necessary measures if the respondents failed to comply with the judgment.
The primary legal issues the court needed to decide included whether the preconditions for granting a default judgment under Rule 13.05(2) of the Federal Circuit and Family Court of Australia (Division 2) (General Law) Rules 2021 (FCFCOA Rules) were satisfied, and whether the applicant's statement of claim adequately supported the relief sought. The court had to consider whether the respondents were indeed in default, as defined under Rule 13.04(2) of the FCFCOA Rules, by virtue of their failure to attend court or file a response. Additionally, the court examined the sufficiency of the statement of claim to establish a reasonable cause of action supporting the relief requested by the applicant.
The court found that the respondents were in default as they had neither appeared nor filed a response, thereby satisfying the conditions for a default judgment under Rule 13.05(2)(c) of the FCFCOA Rules. The court noted that while Rule 13.05(2)(c) does not require proof of the claim by evidence, the statement of claim must present a claim for relief on its face and plead at least one reasonable cause of action. The applicant's statement of claim was deemed sufficient as it detailed the statutory contraventions and the relief sought. The court also considered the principles formulated under the old Federal Court Rules, including the permissible use of relevant evidence and the discretion to refuse a default judgment even when the preconditions are met. Ultimately, the court granted the applicant's application for default judgment and the consequential orders as sought.
In summary, the court granted the Fair Work Ombudsman's application for default judgment against the respondents, L.E.C Builders & Designers Pty Ltd and its sole director. The judgment declared the respondents' contraventions of the Fair Work Act and ordered them to pay outstanding entitlements, interest, and pecuniary penalties as specified. The court retained discretion to further order any necessary measures if the respondents failed to comply with the judgment.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
The applicant’s application in a proceeding was made returnable by the Registry on 16 February 2022 and all parties were advised on 13 December 2021 and again on 7 February 2022 by email of this and that in the event that either of the respondents failed to appear, the matter could proceed in their absence.BACKGROUND Before turning to the hearing on 16 February 2022, it is timely to set out the factual background in the proceedings. In June 2020, the applicant, through one of its inspectors, commenced an investigation into the first respondent’s compliance with the FW Act and associated industrial instruments. As a result of that investigation, the Fair Work Inspector formed the belief that Mr Brian Wilson who worked for the first respondent between May 2019 and June 2020 had been underpaid his entitlements under the Building and Construction Industry General On-site Award 2010. In December 2020, the applicant caused to be issued a compliance notice under s.716 of the FW Act to the first respondent. There was no compliance by the first respondent with that notice (which the second respondent, as the sole director of the first respondent, was aware of). Accordingly, the applicant subsequently commenced the proceedings referred to earlier, making the allegations against the respondents as outlined above.THE ORDERS SOUGHT BY THE APPLICANT In the application in a proceeding filed on 29 October 2021, the applicant sought the following orders:1.An order that default judgment be entered against the Respondents pursuant to Rule 13.05(2) of the Federal Circuit and Family Court of Australia (Division 2) (General Law) Rules 2021 (FCFCOA Rules).2.Upon the admissions which the Respondents are taken to have made, consequent upon default by the Respondents pursuant to Rule 13.04(2) of the FCFCOA Rules, declarations that:(a)the First Respondent contravened section 716(5) of the Fair Work Act 2009 (FW Act) by failing to comply with the Compliance Notice dated 12 December 2020; and(b)the Second Respondent was involved, within the meaning of section 550(2)(c) of the FW Act, in the First Respondent’s contravention of section 716(5) of the FW Act by failing to comply with the Compliance Notice.3.An order pursuant to section 545(1) of the FW Act that the First Respondent take the steps that were required by the Compliance Notice within 28 days of this order, by:(a)calculating and paying to Brian Wilson (Employee) the outstanding entitlements it was required to pay under the Compliance Notice (Outstanding Entitlements);(b)calculating and paying to the chosen Superannuation Fund of the Employee the additional superannuation contributions it was required to pay under the Compliance Notice;(c)preparing and producing to the Applicant a schedule outlining its calculation of the Outstanding Entitlements and additional superannuation contributions; and(d)producing to the Applicant evidence that the Outstanding Entitlements and superannuation contributions were paid as required in subparagraphs (a) and (b) above.4.An order pursuant to section 547(2) of the FW Act that the First Respondent pay interest, within 28 days of this order:(a)to the Employee on the amounts required to be paid in accordance with paragraph 3(a) above;(b)to the Employee’s chosen Superannuation Fund on the amounts required to be paid in accordance with paragraph 3(b) above.5.An order pursuant to section 546(1) of the FW Act that within 28 days of this order, the First Respondent pay a pecuniary penalty to the Commonwealth for the contravention declared at paragraph 2(a) above.6.An order pursuant to section 546(1) of the FW Act that within 28 days of this order, the Second Respondent pay a pecuniary penalty to the Commonwealth for the contravention declared at paragraph 2(b) above.7.An order that the Applicant have liberty to apply on seven days’ notice in the event that any of the above orders are not complied with; and8.Such further order or orders as the Court considers appropriate.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Today, when the matter was called via Microsoft Teams, Ms Sears, Solicitor, appeared on behalf of the applicant and there was no appearance by or on behalf of the first and second respondents.THE APPLICANT’S SUBMISSIONS ON DEFAULT JUDGMENT Ms Sears told the Court that given the above, she was instructed to press the Court to deal with the default judgment application. Ms Sears identified the material relied on and made concise submissions (by reference to the above material) in support of the orders set out in that application.RELEVANT PROVISIONS OF THE RULES The applicant in the application in a proceeding applies under r.13.05 of the GFL Rules for default judgment against the respondents. Subrule 13.05(2) of the GFL Rules applies to a respondent who “is in default”. Under r.13.04(2) of the GFL Rules a respondent is in default if the respondent has not satisfied the applicant’s claim, and the respondent has failed to do one or more of the things identified in r.13.04(2)(b) of the GFL Rules. The things identified in r.13.04(2)(b) of the GFL Rules that are relevant to the application before me is the failure to attend Court, the failure to file a response or defence before the time for doing so has expired, comply with a Court order, and the failure to defend the proceeding with due diligence. When a respondent is in default, or when a respondent is absent from a hearing, the Court may make one of the orders set out in r.13.05(2) of the GFL Rules. Relevant to the application before me is r.13.05(2)(c) of the GFL Rules which provides that the Court may:..if the proceeding was started by an application supported by a statement of claim or the Court has ordered that the proceeding continue on pleadings – give judgment against the respondent for the relief that:(i) the applicant appears entitled to on the statement of claim; and(ii) the Court is satisfied it has power to grant . . . Rules 13.04 and 13.05 of the GFL Rules were adapted from, and are substantially similar to, the rules contained in O35A of the now repealed Federal Court Rules 1979 (‘the old FC Rules’); and r.13.05(2)(c) of the GFL Rules is almost identical to O35A, r.3(2)(c) of the old FC Rules. There are a number of principles that have been formulated in relation to O35A, r.(3)(2) of the old FC Rules which apply to r.13.05 of the GFL Rules. These include the following:(a)first, r.13.05(2)(c) of the GFL Rules “does not require proof of the claim by evidence, but only requires that – on the face of the statement of claim – there is a claim for the relief sought”.[1](b)second, before the Court may make an order under r.13.05(2)(c) of the GFL Rules it must be satisfied that the document, which the applicant has filed with the application, is in fact a “statement of claim”. A statement of claim is a pleading, which means it must comply with the rules of pleading. (c)third, it follows from (b) that the statement of claim must plead at least one reasonable cause of action that supports the granting of the relief the applicant seeks in the application. More particularly, “each element of the relevant civil wrong” of which the applicant complains must be “properly and discretely pleaded in the statement of claim”.[2](d)fourth, although r.13.05(2)(c) of the GFL Rules does not require proof of the claim by evidence, it is permissible for the applicant to adduce evidence that is relevant to the relief sought. It has been confirmed that it is permissible on an application for an order under O35A r 3(2)(c) of the old FC Rules to adduce evidence relevant to relief. In Australian Competition and Consumer Commission v Dataline.Net.Au Pty Limited, Kiefel J (as her Honour then was) said:[3] It may be accepted that some further affidavit material may be accepted by the Court in relation to the relief sought….Evidence which would alter the pleaded case should not be admitted….Regard should not be had to evidence of facts which could have been, but were not, pleaded concerning the conduct of the respondents. (e)Finally, the Court retains a discretion not to make an order under r.13.05(2)(c) of the GFL Rules even if the preconditions for making an order are satisfied.[4]
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.