Fair Work Ombudsman v Mobile Food Vans & Trucks Pty Ltd
[2021] FCCA 882
•28 April 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Fair Work Ombudsman v Mobile Food Vans & Trucks Pty Ltd [2021] FCCA 882
File number(s): MLG 4043 of 2020 Judgment of: JUDGE O'SULLIVAN Date of judgment: 28 April 2021 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 to proceed undefended – default by first and second respondents – orders made on default by respondents. Legislation: Fair Work Act 2009 (Cth) ss 545, 547, 550, 716
Vehicle Repair Services and Retail Award 2010
Federal Circuit Court Rules 2001 (Cth) rr 7.01, 13.03A, 13.03B, 13.03C
Federal Court Rules 2011
Cases cited: Hartnett Legal Services Proprietary Limited v Ballantyne [2015] FCA 744
Fair Work Ombudsman vs IE Enterprises Proprietary Limited [2020] FCA 848
Number of paragraphs: 22 Date of hearing: 28 April 2021 Place: Melbourne Solicitor for the Applicant: Fair Work Ombudsman Counsel for the Applicant: Ms Will Solicitor for the First Respondent: No appearance Counsel for the Second Respondent: No appearance ORDERS
MLG 4043 of 2020 BETWEEN: FAIR WORK OMBUDSMANS
Applicant
AND: MOBILE FOOD VANS & TRUCKS PTY LTD
First Respondent
YENER GELGEL
Second Respondent
ORDER MADE BY:
JUDGE O'SULLIVAN
DATE OF ORDER:
28 APRIL 2021
THE COURT ORDERS THAT:
1.The applicant have leave to proceed on an undefended basis pursuant to Rule 13.03A(a)(2)(i)(ii)(iii)(vii), Rule 13.03B(2)(d) and Rule 13.03C(1)(e) of the Federal Circuit Court Rules 2001 (“the Rules”).
2.Pursuant to rule 7.01(1) of the Federal Circuit Rules 2001 (Cth), the name of the second sespondent be amended to read “Yener Gelgel”.
3.Default judgment be entered for the applicant against the first respondent and the second respondent pursuant to Rule 13.03B(2)(c) of the Rules by reason of the first and second Respondents’ default pursuant to Rule 13.03A(2) of the Rules by their failure to each:
(a)file a Notice of Address for Service as required by rule 6.01 of the Rules;
(b)file any response or a defence within 28 days of service as required by rules 4.03 and 4.05(3)(a) of the Rules; file and serve a Notice of Address for Service by 23 February 2021 in accordance with Order 3 of the orders of the Court dated 16 February 2021;
(c)file and serve any response and defence by 16 March 2021 in accordance with Order 4 of the orders of the Court dated 16 February 2021; and
(d)defend the proceeding with due diligence.
THE COURT DECLARES THAT:
4.Upon admissions that the first and second Respondents are taken to have made, consequent upon non-compliance with the Rules and orders of the Court, the Court declares that:
(a)the first respondent contravened section 716(5) of the Fair Work Act 2009 (Cth) (“FW Act”) by failing to comply with a compliance notice given to the first respondent on 7 April 2020 (“Compliance Notice”); and
(b)the second respondent was involved in, within the meaning of section 550(2) of the FW Act, the contravention by the first respondent of section 716(5) of the FW Act and is taken to have contravened section 716(5) of the FW Act.
THE COURT ORDERS THAT:
5.
(a)pursuant to section 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:
(i)calculating and paying to Nildipkumar Gajera (“Mr Gajera”) the outstanding entitlements that the first respondent was required to pay as specified in the Compliance Notice;
(ii)calculating and paying superannuation contributions into Mr Gajera’s nominated superannuation fund for the additional superannuation contributions required to be paid on the outstanding entitlements referred to in paragraph 5(a)(i) above;
(iii)preparing and producing to the applicant a schedule outlining the calculation of the outstanding entitlements and the additional superannuation contributions referred to at paragraphs 5(a)(i) and 5(a)(ii) above; and
(iv)providing evidence to the applicant that the outstanding entitlements and the additional superannuation contributions referred to at paragraphs 5(a)(i) and 5(a)(ii) above have been rectified;
(b)pursuant to sections 545(1) and 547(2) of the FW Act, the first respondent pay interest calculated in accordance with the applicable pre-judgment interest rates prescribed by the Federal Court of Australia to:
(i)Mr Gajera on the amount owed to Mr Gajera pursuant to paragraph 5(a)(i) above; and
(ii)Mr Gajera’s nominated superannuation fund on the additional superannuation contributions required to be paid pursuant to paragraph 5(a)(ii) above,
within 28 days of this order.
(c)the applicant serve a copy of these orders within 7 days:
(i)on the first respondent by posting it to the first respondent at its registered office and principal place of business at 24 Gasoline Way, Craigieburn, Victoria 3064; and
(ii)on the second respondent by the means specified in order 2 of the Court’s orders of 16 February 2021;
(d)the matter is adjourned to 29 July 2021 commencing at 10.00am at the Federal Circuit Court at Melbourne for a further hearing in respect of the applicant’s claim for penalties to be imposed on the respondents for the contraventions declared at paragraph 4 above;
(e)evidence in chief on the question of penalty be by way of affidavit;
(f)the applicant files and serves evidence and submissions relating to penalty by no later than 35 days prior to the date of the hearing fixed pursuant to paragraph 5(d);
(g)the respondents file and serve evidence and submissions relating to penalty no later than 21 days prior to the date of the hearing fixed pursuant to paragraph 5(d);
(h)the parties have liberty to apply.
REASONS FOR JUDGMENT
(Revised from transcript)INTRODUCTION
Before the Court today are proceedings between the Fair Work Ombudsman (“the applicant”), Mobile Food Vans and Trucks Proprietary Limited (“the first respondent”) and Yener Gelgel (“the second respondent”).
BACKGROUND
The applicant commenced these proceedings by application and statement of claim filed on 19 November 2020. In the statement of claim the applicant alleged that the first respondent was incorporated, capable of being sued, is a constitutional corporation and a national systems employer for the purposes of the Fair Work Act 2009 (Cth) (“the Act”). It was alleged that the first respondent operated a business manufacturing food trailers, vans and trucks and was located in Cranbourne, Victoria. The statement of claim also alleged that the second respondent was the manager of that business and, amongst other things, was responsible for the first respondent complying with its obligations under the Act.
The statement of claim further alleged that the applicant commenced an investigation into the first respondent in 2019 following a complaint made about alleged underpayments. It was alleged that the investigation found that between May 2018 and June 2018 and again between March 2019 and November 2019, Mr Nilarumpar Gadjira was employed by the first respondent and his employment was governed by the Vehicle Repair Services and Retail Award 2010 (“the Modern Award”).
It was alleged that he was underpaid by the first respondent by reference to the minimum rates in that Modern Award, overtime and that he did not receive on termination accrued annual leave. The statement of claim alleged that as a result of the findings of that investigation the applicant issued a compliance notice to the first respondent pursuant to s.716 of the Act in April 2020. It was alleged that the first respondent did not comply with that notice. Finally, it was alleged that the second respondent, who was responsible for ensuring the first respondent complied with the Act and the compliance notice, was involved in that non-compliance within the meaning of s.550 of the Act and was, therefore, also taken to have contravened s.716 of the Act. Finally, the statement of claim set out the relief sought.
The proceedings were given a first Court date of 16 February 2021. The applicant subsequently served the first respondent and, as it had done during the investigation, sent emails to the second respondent annexing the same documents. The applicant subsequently received a response to that email from the second respondent on 24 November 2020.
However, because of difficulties in physically serving the second respondent and prior to the first Court date, the applicant filed an application in a case for orders for substituted service on the second respondent. Also prior to the first Court date, the applicant was advised by a director of the first respondent that it was not in a position to defend the proceedings.
On the first Court date and on the basis of the affidavits of Ms Laura Willoughby, filed 11 February 2021 (which was marked as Exhibit A3 on that day), and Ms Cheryl Claney (which was marked as Exhibit A4 on that day), the Court made certain orders, including orders for substituted service on the second respondent. These were as follows:
THE COURT ORDERS THAT:
1. Pursuant to rule 6.04(b) of the Federal Circuit Court Rules 2001 (Cth) (“the Rules”) that the Applicant’s Originating Application and Statement of Claim filed on 19 November 2020 is deemed to have been served on the Second Respondent on 24 November 2020 by email to [email protected]
2. Pursuant to rule 6.14 of the Rules, until further order, or a Notice of Address for Service is filed by the Second Respondent, service of all documents in these proceedings is deemed to have been effected on the Second Respondent:
(a) by sending a copy of the documents by email to [email protected] and [email protected] ; and
(b) on the next business day after the documents were sent by email.
3. The Respondents each file and serve a Notice of Address for Service by 23 February 2021.
4. The Respondents each file and serve by 16 March 2021:
(a) any Response to the Applicant’s Application pursuant to rule 4.03 of the FCC Rules; and
(b) if a Response is filed and served, a Defence to the Applicant’s Statement of Claim pursuant to rule 4.05(3)(a) of the FCC Rules.
5. If the Respondents comply with orders 3 and 4 of these orders, the matter is listed for directions 28 April 2021 commencing at 10:00am.
6. If either of the Respondents do not comply with either of orders 3 and 4 of these orders:
(a) the Applicant file and serve any application in a case with a supporting affidavit seeking orders against either of the Respondents who are in default, pursuant to rule 13.03B of the Rules by 31 March 2021;
(b) the Applicant file and serve submissions in respect of the application in a case by 7 April 2021;
(c) the Respondents each file and serve any affidavit evidence and submissions in respect of the application in a case by 21 April 2021;
(d) the matter is listed for hearing as to default on a date to be fixed not before 22 April 2021.
7. The parties have liberty to apply.
Given the material before the Court today, the applicant, I am satisfied, attended to service on both the first and second respondents of those orders, in accordance with those orders.
In the face of the respondent’s failure to comply with those orders, the applicant then filed another application in a case on 31 March 2021, which was made returnable on 28 April 2021. The application in a case sought orders for inter alia default judgment. The application in a case was supported by the further affidavit of Ms Laura Willoughby (which was also marked as Exhibit A3 today). The applicant filed an outline of submissions on 7 April 2021 (and this was marked as Exhibit A2 today) and a minute of orders sought (which was marked as Exhibit A1 today). Finally, the applicant also filed a further affidavit on 23 April 2021 (which was marked as Exhibit A9 this day), establishing that the above material had been served on the respondents and why an order as sought in Exhibit A1 this day, pursuant to Rule 7.01 of the Federal Circuit Court Rules 2001 (Cth) (“the Rules”) was necessary to correctly identify the name of the second respondent, given a typographical error in the name that had previously been made in the material that had been filed.
THE HEARING
Today, Ms Willoughby, Solicitor, has appeared on behalf of the applicant. There was no appearance by or on behalf of either the first or second respondents. The respondents have both been called outside of Court this day. There has been no answer to the call.
There has been no compliance by either the first or second respondents with the orders made on 16 February 2021. There has been no response filed by or on behalf of the first or second respondents to the application and statement of claim or the most recent application in case. There has been no contact made with the Court by or on behalf of either respondent to explain their absence.
On the face of the evidence before the Court today, the details of which I have already referred to, I am satisfied that the respondents are aware that the matter is in Court today, that they have not complied with the orders of 16 February 2021, have been served with the material that the applicant relies on and there has been no correspondence or contact made with the Court by or on their behalf to seek an adjournment.
In the face of those defaults by both respondents to do what they are required to do under the Rules of the Court and in the orders of 16 February 2021, Ms Willoughby sought leave to proceed with her client’s application in a case for default judgment.
APPLICANT’S SUBMISSIONS ON DEFAULT JUDGMENT
On 7 April 2021, the applicant filed an outline of submissions which provided:
INTRODUCTION
1. These submissions are filed in support of the Applicant’s Application in a Case filed on 31 March 2021 seeking default judgment, declarations and orders against the Respondents in these proceedings (Default Application).
2. The proceedings concern the Respondents’ alleged contravention of section 716(5) of the Fair Work Act 2009 (Cth) (FW Act) by failing to comply with a compliance notice issued by Fair Work Inspector Yoomin Lee (FWI Lee) on 7 April 2020 (Compliance Notice). The Compliance Notice required the First Respondent to calculate and rectify any underpayments in respect of its employment of Nildipkumar Gajera (Employee) and produce evidence of its compliance with the Compliance Notice.
3. The Applicant alleges that the Second Respondent was involved, within the meaning of section 550 of the FW Act, in the First Respondent’s alleged contravention of section 716(5) of the FW Act.
4. This Default Application is made pursuant to rule 13.03B(2)(c) of the Federal Circuit Rules 2001 (Cth) (Rules) on the basis that the Respondents have not participated in the proceedings, and have failed to comply with the orders of the Court.
5. The Applicant relies on the following documents in support of the Default Application:
(a) Originating Application and Statement of Claim dated and filed on 19 November 2020;
(b) Affidavit of Cheryl Claney, sworn on 22 December 2020 and filed 2 February 2021 (First Claney Affidavit);
(c) Affidavit of Cheryl Claney, sworn on 23 March 2021 and filed 29 March 2021 (Second Claney Affidavit);
(d) Affidavit of Laura Willoughby, affirmed on 10 February 2021 and filed 11 February 2021 (First Willoughby Affidavit); and
(e) Affidavit of Laura Willoughby, affirmed and filed on 31 March 2021 (Second Willoughby Affidavit).
PROVISIONS AND PRINCIPLES REGARDING DEFAULT JUDGMENT
6. Rule 13.03A(2) of the Rules provides that a respondent will be in default for the purposes of rule 13.03B of the Rules if the respondent has not satisfied the applicant’s claim and fails to do one or more of the things specified in the rule.
7. For the purposes of the Default Application, the Applicant relies on the following provisions of Rule 13.03A(2):
(a) rule 13.03A(2)(b)(i), which provides that a respondent will be in default if it fails to give an address for service before the time for the respondent to give an address for service has expired;
(b) rule 13.03A(2)(b)(ii), which provides that a respondent will be in default if it fails to file a response before the time for the respondent to file a response has expired;
(c) rule 13.03A(2)(b)(iii), which provides that a respondent will be in default if it fails to comply with an order of the Court in the proceeding; and
(d) rule 13.03A(2)(b)(vii), which provides that a respondent will be in default if it fails to defend the proceedings with due diligence.
8. With respect to rule 13.03A(2)(b)(i), the Applicant relies on rule 6.01 which requires a party to a proceeding to give an address for service. For the purposes of rule 13.03A(2)(b)(ii), the Applicant relies on rules 4.03 and 4.05(3) which require a respondent to file and serve any response and a defence within 28 days of service of the initiating application.
9. Rule 13.03B(2)(c) of the Rules enables the Federal Circuit Court to give judgment against a respondent in a proceeding which was commenced by an application supported by a statement of claim. The Court may give judgment against a respondent for the relief that the applicant appears entitled to on the statement of claim and that the Court is satisfied it has power to grant.
10. An order for default judgment under rule 13.03B(2)(c) of the Rules is available where there is a basis for the relief sought by an applicant on the face of the statement of claim and the facts pleaded therein. There is no requirement for proof of the applicant’s claim by way of evidence.[1] An application under rule 13.03B(2)(c) is therefore generally determined on the face of the facts pleaded in the statement of claim alone.[2]
[1] Arthur v Vaupotic Investments Pty Ltd [2005] FCA 433 at [3], cited in Luna Park v Bose [2006] FCA 94 at
[2] ACCC v Yellow Page (No. 2) at [61] to [63], citing Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd [2006] FCA 1427 (ACCC v Dataline) at [48] to [51]. These decisions were decided in respect of order 35A of the now repealed Federal Court Rules 1979 (Cth). Rule 13.03B(2)(c) of the Rules is in identical terms to order 35A and is in similar terms to rule 5.23(2)(c) of the current Federal Court Rules 2011 (Cth).
HISTORY OF THE PROCEEDINGS
11. On 19 November 2020, the Applicant filed an Application and Statement of Claim commencing these proceedings. On 24 November 2020, the Applicant served sealed copies of the Originating Application and Statement of Claim by hand to the First Respondent’s principal place of business and registered office.[3]
[3] First Claney Affidavit at [1]-[6].
12. On 24 November 2020, the Applicant sent an email attaching a letter and sealed copies of the Originating Application and Statement of Claim to the Second Respondent at [email protected].[4] On the same day, the Applicant received a reply email from the Second Respondent acknowledging that his name appeared on the documents attached to the Applicant’s email.[5] The Applicant responded to the Second Respondent’s email on 1 December 2020 and did not receive a reply to that email.[6]
[4] First Willoughby Affidavit at [9].
[5] First Willoughby Affidavit at [10].
[6] First Willoughby Affidavit at [11].
13. On 9 and 10 February 2021, the Applicant sent correspondence to the Second Respondent in relation to the first directions hearing listed on 16 February 2021.[7]
[7] First Willoughby Affidavit at [16], Second Willoughby Affidavit at [8]-[9].
14. On 11 February 2021, the Applicant filed an Application in a case for deemed service and the First Willoughby Affidavit. Sealed copies of the Application and affidavit were served on the First Respondent on 12 February 2021 and on the Second Respondent on 11 February 2021.[8]
[8] Second Willoughby Affidavit at [10]-[11].
15. On 15 and 16 February 2021, the Applicant corresponded via email with the Director of the First Respondent in relation to the first directions hearing listed on 16 February 2021.[9] In this correspondence, the Director of the First Respondent advised the Applicant that the First Respondent was not in a position to defend these proceedings.[10]
[9] Second Willoughby Affidavit at [12]-[14].
[10] Second Willoughby Affidavit at [13]-[14].
16. At the directions hearing on 16 February 2021, there was no appearance for either of the Respondents. The Court made orders (February Orders) that:
(a) the Applicant’s Originating Application and Statement of Claim filed on 19 November 2020, was deemed to have been served on the Second Respondent on 24 November 2020 by email to [email protected] ; and
(b) until further order, or a notice of address for service is filed by the Second Respondent, service of all documents in these proceedings is deemed to have been effected on the Second Respondent by sending a copy of the documents by email to [email protected] and [email protected] ; and
(c) provided the Respondents with a further opportunity to each file and serve:
(i) a notice of address for service by 23 February 2021; and
(ii) any response and a defence by 16 March 2021.
17. Pursuant to rules 4.03 and 4.05(3)(a) of the Rules, the Respondents were required to file and serve any response and a defence by 22 December 2020.[11]
[11] By reason of the Respondents being served with the Originating Application and Statement of Claim on 24 November 2020. See, First Willoughby Affidavit at [9]-[11] and Order 1 of the February Orders with respect to service of the Second Respondent and Second Willoughby Affidavit at [5]-[6] confirming service of the First Respondent.
18. On 17 February 2021, the Applicant sent the February Orders to the Respondents and advised each Respondent of the Applicant’s intention to make an application for default judgment should the First Respondent or the Second Respondent fail to comply with the February Orders. The correspondence sent to the Respondents included hyperlinks to the Notice of Address for Service and Response forms on the Federal Circuit Court’s website.[12]
[12] Second Willoughby Affidavit at [17]-[19].
19. On 23 March 2021, the Applicant sent further correspondence to the Respondents stating that they had each not complied with the February Orders and that pursuant to the February Orders, the Applicant would file an application for the matter to proceed by way of default judgment.[13] On the same day, the Applicant received an email from the Director of the First Respondent indicating that the First Respondent would not defend the proceedings and would await the outcome of the default judgment application.[14]
[13] Second Willoughby Affidavit at [20]-[21].
[14] Second Willoughby Affidavit at [22].
20. On 31 March 2021, the Applicant filed the Default Application and Second Willoughby Affidavit.
DEFAULT BY THE FIRST AND SECOND RESPONDENTS
21. The Respondents have been on notice of the proceedings since 24 November 2020 and have not participated in the proceedings.
22. Neither Respondent has satisfied the Applicant’s claim, nor have they:[15]
[15] Second Willoughby Affidavit at [24].
(a) filed a Notice of Address for Service as required by rule 6.01 of the Rules or as required by the February Orders;
(b) filed a Response in accordance with rule 4.03 of the Rules or as required by the February Orders;
(c) filed a defence in accordance with rule and 4.05(3) of the Rules or as required by the February Orders; and
(d) defended the proceedings with due diligence.
23. Accordingly, the Respondents are in default as defined by rule 13.03A(2) of the Rules, thereby providing a basis for the making of orders under rule 13.03B(2)(c) of the Rules.
ENTITLEMENT TO RELIEF
24. The factual matters relied upon to establish the alleged contraventions of the FW Act are set out in the Statement of Claim.
25. In summary, the Applicant alleges:
(a) the First Respondent, is and was at all relevant times, the operator of a business that manufactures food trailers, vans and trucks (Business);[16]
[16] Statement of Claim at [3].
(b) the First Respondent, is and was at all relevant times, a national system employer within the meaning of section 14 of the FW Act;[17]
[17] Statement of Claim at [3].
(c) the First Respondent is an entity to which the FW Act applied in respect of its employees;[18]
[18] Statement of Claim at [3].
(d) after conducting an investigation, FWI Lee formed a belief that the First Respondent had contravened terms of the Vehicle Manufacturing, Repair, Services and Retail Award 2010 and a provision of the National Employment Standards relating to minimum wages, overtime rates and payment of accrued but untaken annual leave upon termination of employment;[19]
[19] Statement of Claim at [6].
(e) on 7 April 2020, FWI Lee gave the First Respondent a Compliance Notice which required the First Respondent to calculate and rectify any underpayments to the Employee;[20]
[20] Statement of Claim at [7]-[8].
(f) the First Respondent did not take the action required by the Compliance Notice by the due date, or at all, and thereby contravened section 716(5) of the FW Act;[21]
[21] Statement of Claim at [10]-[11]
(g) the Second Respondent was at all material times the manager of the Business, was responsible for ensuring the First Respondent complied with the Compliance Notice, was an intentional participant in the First Respondent’s failure to comply with the Compliance Notice and was therefore involved, within the meaning of section 550(2) of the FW Act, the contravention by the First Respondent of section 716(5) of the FW Act.[22]
[22] Statement of Claim at [4], [7], [12]-[14].
26. Section 716(5) of the FW Act is a civil remedy provision for the purposes of section 539 of the FW Act. Section 539 of the FW Act enables a Fair Work Inspector to apply to the Court for orders in relation to a contravention of a civil remedy provision. The Applicant is an inspector for the purposes of the FW Act (section 701 of the FW Act) and has standing to bring this proceeding.
27. On this basis, the Applicant submits that it has an “entitlement” to the relief sought in the Applicant’s Originating Application, as it has made out a case for relief on the face of the Statement of Claim, as set out above.[23]
[23] ACCC v Dataline at [53].
COURT’S POWER TO MAKE THE ORDERS SOUGHT
28. Pursuant to section 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 that the Court may make include:
(a) declarations, pursuant to section 16 of the Federal Circuit Court Act 1999 (Cth);
(b) pecuniary penalties, pursuant to section 546 of the FW Act;
(c) an order awarding compensation for loss that a person has suffered because of a contravention of the FW Act, as provided for in subsection 545(2)(b) of the FW Act; and
(d) an order for an amount of interest in relation to an amount that a person was required to pay under the FW Act, as provided in subsection 547(2) of the FW Act.
29. The Court has a wide discretionary power to make declarations.[24] The Court may make declarations based on admissions taken to be made consequent on default.[25] This is particularly so in a case such as the present which involves issues of public interest, namely the enforcement of minimum employment entitlements.
30. The declarations sought by the Applicant in the Default Application have been framed to identify the contravening conduct accurately and concisely[26], and in so doing they have utility. They mark the Court’s disapproval of the contravening conduct[27] and serve a public interest in educating employers about their obligations to employees and warning of the consequences of failing to comply with statutory notices. As such the declarations sought play a role in achieving general deterrence.
31. The form of orders and declarations sought includes wording acknowledging that the declarations are based on deemed admissions, to reflect the suggested form of words of Kiefel J in ACCC v Dataline at paragraph 59 and adopted by this Court in Fair Work Ombudsman v Garfield Berry Farm Pty Ltd & Anor [2011] FMCA 885 at paragraphs 6 to 8.
32. The Applicant submits that in all of the circumstances, this is an appropriate case for the Court to make the orders sought in the Default Application.
[24] FCC Act, section 16; ACCC v Dataline at [58-59]; ACCC v Yellow Page (No 2) at [65].
[25] ACCC v Dataline at [54] to [59]; ACCC v Yellow Page (No 2) at [66] to [69].
[26] ACCC v Dataline at [63]; ACCC v Yellow Page (No 2) at [68].
[27] ACCC v Dataline at [63]; ACCC v Yellow Page (No 2) at [69].
RELEVANT PROVISIONS OF THE RULES
Rules 13.03A, 13.03B and 13.03C of the Rules are relevant for the purposes of the default judgment application and so far as presently relevant they provide:
Rule 13.03A: When a party is in default
(1) For rule 13.03B, an applicant is in default if the applicant fails to:
(a) comply with an order of the Court in the proceeding; or
(b) file and serve a document required under these Rules; or
(c) produce a document as required by Part 14; or
(d) do any act required to be done by these Rules; or
(e) prosecute the proceeding with due diligence.
(2) For rule 13.03B, a respondent is in default 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.
Rule 13.03B: Orders on default
(1) If an applicant is in default, the Court may order that:
(a) the proceeding be stayed or dismissed as to the whole or any part of the relief claimed by the applicant; or
(b) a step in the proceeding be taken within the time limited in the order; or
(c) if the applicant does not take a step in the time mentioned in paragraph (b) -- the proceeding be stayed or dismissed, as to the whole or any part of the relief claimed by the applicant.
(2) If a respondent is in default, the Court may:
(a) order that a step in the proceeding be taken within the time limited in the order; or
(b) if the claim against the respondent is for a debt or liquidated damages--grant leave to the applicant to enter judgment against the respondent for:
(i) the debt or liquidated damages; and
(ii) if appropriate--costs; or
(c) if the proceeding was commenced 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; or
(d) give judgment or make any other order against the respondent; or
(e) make an order mentioned in paragraph (b), (c) or (d) to take effect if the respondent does not take a step ordered by the Court in the proceeding in the time limited in the order.
(3) The Registrar must enter judgment for the debt or liquidated damages, costs and interest against the respondent as specified in leave granted under paragraph (2)(b), without giving notice, or further notice, to the respondent, if the applicant has filed in the Registry:
(a) an affidavit, or affidavits, proving:
(i) service of the application claiming judgment for the debt or liquidated damages; and
(ii) that the respondent is in default; and
(b) an affidavit for the debt or liquidated damages in accordance with the approved form.
(4) Unless the Court otherwise orders, if a respondent to a cross-claim is in default:
(a) a judgment or decision on any claim, question or issue in the proceeding on the originating process; or
(b) any other cross-claim in the proceeding;
is binding as between the cross-claimant and the respondent to the cross-claim, to the extent that the judgment or decision is relevant to any claim, question or issue in the proceeding on the cross-claim.
(5) In subrule (4):
“decision” includes a decision by consent.
“judgment” includes a judgment by default or by consent.
(6) The Court may make an order of the kind mentioned in subrule (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.
Rule 13.03C: Default of appearance of a party
(1) If a party to a proceeding is absent from a hearing (including a first court date), the Court may do 1 or more of the following:
(a) adjourn the hearing to a specific date or generally;
(b) order that there is not to be any hearing, unless:
(i) the proceeding is again set down for hearing; or
(ii) any other steps that the Court directs are taken;
(c) if the absent party is an applicant--dismiss the application;
(d) if the absent party is a party who has made an interlocutory application or a cross-claim--dismiss the interlocutory application or cross-claim;
(e) proceed with the hearing generally or in relation to any claim for relief in the proceeding.
(2) 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.
CONSIDERATION
In the decision of Hartnett Legal Services Proprietary Limited v Ballantyne [2015] FCA 744 (“Hartnett”), Rangiah J considered the correct test that should be applied in granting default judgment.[28]
[28] see paragraphs [28] to [76] in Hartnett Legal Services Proprietary Limited v Ballantyne [2015] FCA 744
In summary, and as was set out at paragraph [65] in the decision of Hartnett:
It is the case that r.13.03B(2) allows the Court to give judgment against the respondent for the relief that “the applicant in the case appears entitled to on the statement of claim.” Once jurisdiction is established, the rule merely requires that on the face of the statement of claim there is a claim for relief sought….
For the purposes of the analogous rules in the Federal Court of Australia (i.e. the Federal Court Rules 2011) the decision in Fair Work Ombudsman vs IE Enterprises Proprietary Limited [2020] FCA 848, paragraphs [17] to [20] said:
17. Rule 5.22 of the Federal Court Rules 2011 (Cth) (Rules) provides that a party is in default if the party fails to:
(a) do an act required to be done, or to do an act in the time required, by the Rules;
(b) comply with an order of the Court;
(c) attend a hearing in the proceeding; or
(d) prosecute or defend the proceeding with due diligence.
18. Rule 5.23(2)(c) of the Rules enables the Court, if a respondent is in default, to give judgment against the respondent, in a proceeding which was commenced by an originating application supported by a statement of claim, for the relief that:
(a) is claimed in the statement of claim; and
(b) to which the Court is satisfied that the applicant is entitled.
19. The principles relevant to the making of an order for default judgment have previously been summarised in, amongst other decisions, Speedo Holdings BV v Evans (No 2) [2011] FCA 1227 at [19]–[26] per Flick J, Maylord Equity Management Pty Ltd v Parazelsus Ltd [2014] FCA 979 at [10]–[14] per Gleeson J and Ferraro v DBN Holdings Aust Pty Ltd T/As Sports Auto Group [2015] FCA 1127; 246 FCR 138 at [20] per Besanko J. The key principles may be summarised as follows:
(a) the power afforded to the Court is discretionary. The discretion should generally be exercised with caution;
(b) the discretionary power to enter a judgment by default is enlivened when an applicant makes application to the Court for an appropriate order. In the absence of such an application, the power cannot be invoked;
(c) there is a difference in the terms by which the limits of the power conferred by former O 35A r 3(2)(c) are expressed and the wording of the current r 5.23(2)(c). Notwithstanding that difference in language, the requirement imposed is not that an applicant prove by way of evidence the claim which is sought to be advanced. The requirement is that the Court needs to be satisfied on the face of the Statement of Claim that the applicant is entitled to the relief claimed. The facts as alleged in the Statement of Claim are deemed to have been admitted by the respondent in default;
(d) in order to be satisfied that an applicant is entitled to the relief claimed in the Statement of Claim, the Court needs to be satisfied that each element of the relevant civil wrong involved is properly and discretely pleaded in the Statement of Claim; and
(e) in addition to the facts alleged in the Statement of Claim, the Court may permit recourse to limited further evidence. However, it may not admit evidence which would alter the case as pleaded.
20. Default judgment may be entered where a party’s participation in the proceedings is such as to indicate an inability or unwillingness to cooperate with the Court and the other party in having the matter ready for trial in an acceptable period, or where non-compliance is continuing and occasioning unnecessary delay, expense or other prejudice to the other party: Lenijamar Pty Ltd v AGC (Advances) Ltd [1990] FCA 520; (1990) 27 FCR 388 at 396 per Wilcox and Gummow JJ; see also, as a recent example, Winn v Yeo as former trustee of the estate of Goodwin (a bankrupt) [2020] FCA 552 at [44] per O’Callaghan J. …
The proceedings issued by the applicant are proceedings seeking that the Court deal with the respondents for failing to comply with a compliance notice. A compliance notice is provided for in s.716 of the Act. The issuing of a compliance notice is a power given to Fair Work Inspectors which is designed to be a method by which non-compliance with obligations imposed by the Act can be enforced as an alternative to Court proceedings. Sadly, in this case the respondents have failed to heed the warning such notices contain.
The respondents have not satisfied the applicant’s claims. The respondents have not filed a notice of address for service, a response or affidavit, as required. The respondents have not complied with an order of this Court and, having regard to Rules 13.03A(2), 13.03B(2) and 13.03C(1)(e), the Court has the authority to give judgment or make any other order against both respondents. Given the defaults by the respondents and the material that the applicant has filed, I am satisfied that, pursuant to the relevant sections of the Rules, that I am able to proceed with the application in a case for default judgment this day.
On the face of the material that Ms Willoughby has identified as well as the applicant’s submissions that I have referred to, I am satisfied that the applicant has made out a sufficient basis on the face of the statement of claim for the relief sought. I am satisfied that I am able to make the requisite declarations in relation to the contraventions by both respondents of the Act. Section 545 of the Act confers on the Court broad powers to grant relief to a person(s) who have suffered as a result of a contravention of a civil remedy provision. By virtue of s.545(2) of the Act, the Court has the power to order a payment for compensation for loss that a person has suffered because of a contravention, as well as interest on that amount, which is provided for in s.547.
CONCLUSION
Therefore, and for the reasons set out above, I will make the requisite declarations, as contained in Exhibit A1 that the respondents have contravened the relevant provisions of the Act referred to in the statement of claim and the necessary consequential orders. I require the applicant to serve the respondents with a copy of the orders made this day by the same means as set out in the orders of 16 February 2021 and I otherwise fix the matter for a penalty hearing on 29 July 2021, with the directions for that purpose as also contained in Exhibit A1.
I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment of Judge O'Sullivan. Associate:
Dated: 28 April 2021
[20] and Tyco (Australia) Pty Ltd t/as ADT Security v Signature Security Group Pty Ltd (No 7) [2011] FCA 615 at [5] and Australian Competition and Consumer Commission v Yellow Page Marketing BV (No 2) [2011] FCA 352 (ACCC v Yellow Page (No. 2)) at [14].
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