Fair Work Ombudsman v South Jin Pty Ltd and Ors (No.2)
[2012] FMCA 628
•17 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v SOUTH JIN PTY LTD & ORS (No.2) | [2012] FMCA 628 |
| INDUSTRIAL LAW – Fair Work Act – interlocutory orders – application for default judgment against one Respondent – application for declaration permitting order for discovery against another Respondent. |
| Workplace Relations Act 1996, ss.719 & 722 Fair Work Act 2009, ss.45, 545 & 546 Federal Magistrate Court Rules 2001, rr.13.03, 13.10 & 14 Federal Magistrates Court Act 1999, s.45 |
| Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477 Trade Practices Commission v Abbco Iceworks Pty Ltd & Ors (1994) 52 FCR 96 Kelbush Pty Ltd v Western Pacific Automotive Pty Ltd [2012] FMCA 257 |
| Applicant: | FAIR WORK OMBUDSMAN |
| First Respondent: | SOUTH JIN PTY LTD |
| Second Respondent: | KI BOK JIN |
| Third Respondent: | COASTAL TROLLEY SERVICES PTY LTD |
| Fourth Respondent: | EDWARD STROOP |
| File Number: | ADG 159 of 2011 |
| Judgment of: | Lindsay FM |
| Hearing date: | 9 July 2012 |
| Date of Last Submission: | 9 July 2012 |
| Delivered at: | Adelaide |
| Delivered on: | 17 July 2012 |
REPRESENTATION
| Counsel for the Applicant: | Ms Richards |
| Solicitors for the Applicant: | Office of the Fair Work Ombudsman |
| The first Respondent: | No appearance |
| Counsel for the second Respondent: | Mr Manuel |
| Solicitors for the second Respondent: | WBH Legal |
| Counsel for the third & fourth Respondents: | Mr Lazarevich |
| Solicitors for the third & fourth Respondents: | Camatta Lempens Pty Ltd |
ORDERS
Pursuant to Rule 13.03B (2)(c) of the Federal Magistrates Court Rules 2001, the Court declares that South Jin contravened:
(a)Subsection 185(2) of the Workplace Relations Act 1996 in relation to each of the Category A Employees employed during the First Casual Loading Period;
(b)Item 5 of Schedule 16 of the Transitional Act in relation to each of the Category A Employees employed during the Second Casual Loading Period;
(c)Clause 16.1 of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Third Pay Rate Period;
(d)Clause 12.5(a) of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Third Casual Loading Period;
(e)Clause C.7.2 of Schedule C of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Fourth Casual Loading Period;
(f)Clause C.7.3 of Schedule C of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Fifth Casual Loading Period;
(g)Clause 27 of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the First Penalty Rates Period;
(h)Clause C.7.3 of Schedule C of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Second Penalty Rates Period;
(i)Clause 28 of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Overtime Rates Period;
(j)Clause 23.2 of the Award and thereby section 45 of the Fair Work Act 2009 in relation to each of the Category A Employees employed during the Superannuation Contributions Period;
(k)Regulation 19.20(1) of the WR Regulations in relation to each of the Employees employed during the WR Pay Slips Period;
(l)Regulation 19.20(2) of the WR Regulations in relation to each of the Employees employed during the WR Pay Slips Period;
(m)Subsection 536(1) of the Fair Work Act 2009 in relation to each of the Employees employed during the FW Pay Slips Period;
(n)Regulation 3.46(5) of the FW Regulations and thereby subsection 536(2) of the Fair Work Act 2009 in relation to each of the Employees who received a pay slip on or about 12 September 2010;
(o)Regulation 19.4(1) of the WR Regulations in relation to each of the Employees employed during the WR Record Keeping Period;
(p)Regulation 19.8(1) of the WR Regulations in relation to each of the Employees employed during the WR Record Keeping Period;
(q)Regulation 3.32 of the FW Regulations and thereby subection 535(2) of the Fair Work Act 2009 in relation to each of the Employees employed during the FW Record Keeping Period;
(r)Regulation 3.34 of the FW Regulations and thereby subsection 535(1) of the Fair Work Act 2009 in relation to each of the Employees employed during the FW Record Keeping Period.
Pursuant to subsection 719(6) of the Workplace Relations Act 1996 and subsection 545(2) of the Fair Work Act 2009 that South Jin pay the total underpayment of $165,323.77 to the Category A Employees as follows:
(a)$1,118.56 to Ashin Maharajan;
(b)$2,216.42 to Avi Narayan Baskota;
(c)$1,073.43 to Biswajit Sarkar;
(d)$781.33 to Bo Gyu Shin;
(e)$2,011.98 to Bongdong Kim;
(f)$5,268.88 to Changhoon Yang;
(g)$3,538.86 to Changhyun Han;
(h)$5,220.34 to Changwoo Lee;
(i)$2,598.70 to Chanmo Park;
(j)$2,684.51 to Daero Kang;
(k)$6,598.08 to Daeseong Kim;
(l)$1,514.21 to Daeyeul Kim;
(m)$2,647.86 to Dongil Lee;
(n)$1,785.89 to Dongjun Park;
(o)$7,364.93 to Dongog Kim;
(p)$3,287.30 to Haegyu Kang;
(q)$669.71 to Ho Sung Kim;
(r)$2,425.54 to Hyechan Kim;
(s)$4,712.06 to Hyeongtae Kim;
(t)$6,864.70 to Hyeon Cheol Cho;
(u)$2,850.47 to Hyunok Kim;
(v)$7,311.60 to Hyunwoo Jeon;
(w)$6,260.07 to Ildoo Kim;
(x)$2,684.51 to Jeongjung Kim;
(y)$1,721.49 to Jinbok Kim;
(z)$2,933.54 to Jongdae Won;
(aa)$6,801.05 to Jongsu Jeong;
(bb)$2,455.60 to Jongsu Kim;
(cc)$2,859.25 to Junhee Won;
(dd)$2,346.33 to Kumar Shrestha;
(ee)$5,187.50 to Kyewoon Lee;
(ff)$699.14 to Minho Sim;
(gg)$6,749.23 to Minhwan Cheon;
(hh)$8,081.02 to Minseok Yang;
(ii)$2,602.47 to Mit Eum Lee;
(jj)$2,949.29 to Myeonghan Yu;
(kk)$5,011.29 to Prabin Rajbhandari;
(ll)$3,358.83 to Rabin Bk;
(mm)$1,361.85 to Raj Kumar Aryal;
(nn)$6,321.13 to Sanghun Han;
(oo)$1,007.84 to Sanju Shrestha;
(pp)$2,268.25 to Sehwan Kim;
(qq)$4,468.82 to Sungyong Song;
(rr)$2,973.62 to Taeho Kwon;
(ss)$502.24 to Wenjin Liao;
(tt)$1,497.91 to Wookyung Kwun;
(uu)$5,428.18 to Yunseok Kim; and
(vv)$3,366.56 to Yusuck Won.
Pursuant to subsection 722(1) of the Workplace Relations Act 1996 and subsection 546(1) of the Fair Work Act 2009 that South Jin pay interest to each Employee on the amounts specified in the preceding order.
The applicant do provide the Court with interest calculations for the purposes of paragraph 3 hereof within 7 days.
The question of penalty to be imposed on South Jin for its contraventions be adjourned to the conclusion of the hearing as to liability in relation to the other Respondents.
That the application of the Applicant for a declaration pursuant to.s.45 of the Federal Magistrates Court Act 1999 and consequential orders for discovery pursuant to Rule 14 of the Rules of Court be adjourned to a date following upon the determination of the applications for summary dismissal filed on behalf of the Second Respondent and the Third and Fourth Respondents.
The Respondents file and serve their outline of argument on which they seek to rely in support of any application in a case to summarily dismiss the Applicant’s third amended statement of claim by Monday, 6 August 2012.
The Applicant file and serve their outline of argument and evidence on which it seeks to rely in response to any application in a case to summarily dismiss the Applicant’s third amended statement of claim by Monday, 27 August 2012.
The matter be listed for argument concerning any application in a case to summarily dismiss the Applicant’s third amended statement of claim not before Monday, 3 September 2012, at a date to be advised in writing by the Associate to FM Lindsay following consultation with counsel.
The parties have liberty to apply.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADG 159 of 2011
| FAIR WORK OMBUDSMAN |
Applicant
And
| SOUTH JIN PTY LTD |
First Respondent
| KI BOK JIN |
Second Respondent
| COASTAL TROLLEY SERVICES PTY LTD |
Third Respondent
| EDWARD STROOP |
Fourth Respondent
REASONS FOR JUDGMENT
On 9 July 2012 I reserved my determination on a number of interlocutory orders.
Having on 20 April 2012 given the Applicant leave to file a third amended statement of claim, the parties agreed further interlocutory orders on 24 April 2012. Pursuant to those orders the third amended statement of claim has been filed and defences have been filed.
Those orders also permitted any party applying for a declaration relating to discovery and orders in relation thereto to file and serve an application relating to the same by 2 July 2012.
On 2 July 2012 the Applicant filed an application in a case seeking a declaration authorising discovery and discovery of a range of documents from the Third Respondent.
That application in a case also sought a default judgment against the First Respondent.
On 5 July 2012 the Second Respondent filed an application for summary dismissal of the claim.
On 9 July 2012 the Third and Fourth respondents filed an application for summary dismissal of the claim.
The parties have agreed orders as to time tables relating to the furtherance of the applications for summary judgment.
I deal firstly with the application for default judgment against the First Respondent.
The Third Respondent provided trolley collection services in South Australia in furtherance of contractual arrangements it had with another company (“ITM”) to various retail outlets in South Australia. The Fourth Respondent is a director and shareholder of the Third Respondent. The Third Respondent engaged the First Respondent to provide trolley collection services to it. The Second Respondent was the manager and sole director and shareholder of the First Respondent.
The Applicant seeks orders by way of declaration that the Respondents have contravened certain clauses of the Federal Minimum Wages Provisions of the Workplace Relations Act 1996 and the Cleaning Services Award 2010 and by so doing have contravened s.45 of the Fair Work Act 2009. That section is a civil remedy provision. Pecuniary penalty orders pursuant to s. 546 of the Fair Work Act 2009 are sought in addition to orders compensating a range of employees in respect of underpayments pursuant to s. 545 of the Fair Work Act 2009 and s.719 of the Work Place Relations Act 1996.
The application and statement of claim was served on the First Respondent on 28 June 2011. The First Respondent filed a defence on 21 October 2011.
The First Respondent’s solicitors filed a Notice of Withdrawal on 20 March 2012 though they continue to act for the Second Respondent. The First Respondent has not participated in these proceedings since that date.
I am satisfied that since that date the Applicant has forwarded notice of relevant Court orders to the First Respondent’s registered business address.
On 24 April 2012, as noted above, the various Respondents were ordered to file and serve their final defences to the statement of claim by 18 May 2012. That order has been drawn to the attention of the First Respondent by the Applicant’s solicitors. The First Respondent has not complied with that order for a period now approaching two months. It has not taken any step in the proceedings since March 2012.
It is for that reason that the Applicant has sought an order pursuant to Rule 13.03B(2)(c) of the Federal Magistrates Court Rules 2001 for judgment against the First Respondent for the relief sought in the third amended statement of claim.
The order is formally opposed by the Second, Third and Fourth Respondents.
I am satisfied that the First Respondent is in default in accordance with Rule 13.03A and that the Applicant is entitled to seek default judgment.
I am also satisfied that it is appropriate to make the order sought by the Applicant upon the basis of the relief sought on the face of the statement of claim alone. In any event, the matters set forth in paragraphs [13] to [15] inclusive of the Applicant’s submissions in relation to default judgment in my view provide an appropriate basis for orders in terms of the Applicant’s claim for relief.
I am satisfied I have the power to make the orders sought by way of declaration and the orders sought pursuant to ss.719 and 722 of the Work Place Relations Act 1996 and ss. 545 and 546 of the Fair Work Act 2009.
The Applicant through its counsel conceded that the entry of judgment against the First Respondent will not be utilised by the Applicant to facilitate or assist in the obtaining of the orders sought against the Second, Third or Fourth Respondents.
I will make the orders sought by the Applicant against the First Respondent as set forth in paragraphs [20] to [22] inclusive of the Applicant’s submissions in relation to default judgment.
The Applicant seeks a declaration pursuant to s.45 of the Federal Magistrates Court Act 1999.
Section 45 provides:
(1) Interrogatories and discovery are not allowed in relation to proceedings in the Federal Magistrates Court unless the Federal Magistrates Court or a Federal Magistrate declares that it is appropriate, in the interests of the administration of justice, to allow the interrogatories or discovery.
(2) In deciding whether to make a declaration under subsection (1), the Federal Magistrates Court or a Federal Magistrate must have regard to:
(a) whether allowing the interrogatories or discovery would be likely to contribute to the fair and expeditious conduct of the proceedings; and
(b) such other matters (if any) as the Federal Magistrates Court or the Federal Magistrate considers relevant.
The documents sought if the declaration is made are described in a schedule attached to the application in a case filed on 2 July 2012.
They are documents arising out of the contractual relations between the Third Respondent and ITM and between the Third Respondent and the First or Second Respondent and relating to compliance by the First Respondent with its various obligations to those whom it employed. The Applicant’s case against the Third Respondent is that it was knowingly concerned in the various breaches by the First Respondent of the relevant legislative provisions.
The Fourth Respondent would undoubtedly be able to resist such an application on the basis of the privileges against self incrimination and self-exposure to the imposition of a civil penalty. But neither privilege can be claimed by a corporation. Whatever doubts there were in relation to that latter proposition following the decision of the High Court in Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477 were resolved authoritatively by the Full Court of the Federal Court of Australia in Trade Practices Commission v Abbco Iceworks Pty Ltd & Ors (1994) 52 FCR 96 (see the analysis of the ratio decidendi of Caltex (supra) and of the obiter dicta of the members of the High Court in that case and in particular of Brennan J as he then was by Burchett J at 111B – G).
The Third Respondent does not have available to it any claim or recourse to either of those privileges and neither am I satisfied that they have a claim to such privileges because of any effect that the denial of entitlement to such privileges will have on the Fourth Respondent. The submission was that obliging the Third Respondent to make discovery would render nugatory the Fourth Respondent’s own claim for privilege in relation to such disclosure. The Third Respondent also argued for the existence of a separate common law principle (distinct from the two privileges mentioned) enabling it to resist an order for discovery in limine.
It is unnecessary for me to deal with those submissions because of the view I take that, in any event, it is not appropriate in the interests of the administration of justice to allow the discovery.
The final form of the application has been filed and has elicited an amended response by the Third and Fourth Respondents and a reply to that amended response. It has also elicited a defence of the Second Respondent.
Pursuant to the orders of 24 April the Applicant has filed the evidence-in-chief of those witnesses upon whom it proposes to rely at the trial. That material is detailed and extensive.
All parties accepted that the decision of Lucev FM in Kelbush Pty Ltd v Western Pacific Automotive Pty Ltd [2012] FMCA 257 at [22] accurately summarised the matters relevant to the exercise of the discretion under s.45.
Subsection (2)(a) of s.45 directs me to have regard to whether allowing the discovery would be likely to contribute to the fair and expeditious conduct of the proceedings.
If I were to make the orders sought in relation to the various classifications of documents set forth in the schedule, the affidavit of documents filed by the Fourth Respondent would be likely to be extensive and entail a lengthy process of inspection with the possibility of request for further amendment of the particulars of the claim.
I am entitled to assume that the case of the Applicant has been explicated in the final form of its statement of claim. All of the Respondents are entitled to make that same assumption. Any material arising from the making of the orders for discovery must be seen as augmenting rather than making a claim that the Applicant contends is already made out.
The Second Respondent on the one hand and the Third and Fourth Respondents on the other have brought summary dismissal applications on the assumption that the Applicant had particularised its claim. The application of the Second Respondent as adumbrated in the affidavit of Ms Manual of 5 July 2012 focuses upon the inadequacy and prolixity of the final form of the application as grounding the entitlement to summary dismissal. Whilst the application in a case does not refer to a specific provision of Rule 13.10 it is manifest that the claim is for relief pursuant to subsection (b) or subsection (c) or both. The claim of the Third and Fourth Respondents, on the other hand, is a claim made pursuant to subsection (a) that the Applicant has no reasonable prospect of successfully prosecuting the proceeding or claim.
Each of those summary dismissal applications have been made at a time when the Respondents were entitled to assume the claim was in its final form.
It would not be appropriate in the interest of the administration of justice to make a declaration pursuant to s.45 because the making of the orders for discovery of the documents sought would very likely require further amendment of the claim. That is on the assumption that the documents discovered would materially assist the Applicant in establishing that the Third and Fourth Respondents were knowingly concerned in the First Respondent’s contraventions. I make that assumption upon the basis of the Applicant’s own contentions.
To the extent that the documents so discovered would not lead to the enlargement of the particulars of claim but only assist in terms of the procurement of evidence to make out a particular or particulars of the claim, then it is an exercise that need not be undertaken until the Court has determined whether the claim is liable to be summarily determined.
In other words, if the documents produced required or entailed an amendment to the particulars of claim it would be oppressive to the Respondents and causing of unacceptable further delay in relation to the proceedings to make the declaration. On the other hand, if the documents produced did not require an amendment to the particulars of claim, then it is an exercise that need not be undertaken at the present time.
The question then arises as to whether the appropriate order is to dismiss or adjourn the application. In my view, the adjudication of the application should be postponed until the summary dismissal applications have been determined and I will so order.
I will also make the agreed orders relating to the time tabling of the documents necessary to prepare for the summary dismissal hearings.
I certify that the preceding forty-two (42) paragraphs are a true copy of the reasons for judgment of Lindsay FM
Date: 17 July 2012
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