Farac v Pendal Group Limited (No 3)

[2023] FedCFamC2G 220

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Farac v Pendal Group Limited (No 3) [2023] FedCFamC2G 220

File number(s):

SYG 2443 of 2020

Judgment of:

JUDGE CAMERON

Date of judgment:

9 February 2023

Catchwords:

PRACTICE & PROCEDURE – application to strike out pleadings – whether abuse of process for being duplicative – relevant considerations.   

Legislation:

Fair Work Act 2009 (Cth), ss. 340, 342

Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) item 14, sch.1

Federal Court Rules 2011 (Cth), r.16.21

Cases cited:

Leach v Burston [2022] FCA 87

Division:

Fair Work

Number of paragraphs:

14

Date of hearing:

9 February 2023

Place:

Sydney

Counsel for the Applicant:

Ms R. Francois

Solicitor for the Applicant:

Kennedys

Counsel for the First and Second Respondents:

Mr D. Mahendra

Solicitor for the First and Second Respondents:

MinterEllison

ORDERS

SYG 2443 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

PETER ADAM FARAC

Applicant

AND:

PENDAL GROUP LIMITED (ACN 126 385 822)

First Respondent

RICHARD BRANDWEINER

Second Respondent

order made by:	JUDGE CAMERON
DATE OF ORDER:	9 February 2023

THE COURT ORDERS THAT:

1.The applicant provide detailed particulars of paragraph 66 of the amended statement of claim as soon as possible.

Note: The form of the order is subject to the entry in the Court’s records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT

Judge Cameron

INTRODUCTION & APPLICATION

1. The applicant, Mr Farac, was employed by the first respondent, Pendal Group Limited (“Pendal”).  The second respondent, Mr Brandweiner, was Pendal’s chief executive officer.  Mr Farac brought this proceeding alleging that Pendal took adverse action against him in a number of ways in contravention of the Fair Work Act 2009 (Cth) (“FW Act”), and that Mr Brandweiner was an accessory to that conduct. The trial in the matter commenced yesterday, but has not yet proceeded beyond procedural matters, most relevantly an unsuccessful application to adjourn the hearing and a part-heard dispute over a notice to produce served by Mr Farac just before Christmas last year. In an endeavour to truncate the disagreement over the notice to produce, the respondents have filed an application in a proceeding seeking orders striking out parts of the amended statement of claim as follows:

   1. Paragraphs 45(b), 66 (f) and 71 of the Amended Statement of Claim filed on 28 January 2022 by the Applicant in proceedings numbered SYG2443/2020 (ASOC) be struck out in accordance with rule 16.21 (e) of the Federal Court Rules 2011 (FC Rules).

   2. Paragraphs 46(c), 66 (g) and 71 of the ASOC be struck out in accordance with rule 16.21(e) of the FC Rules.

   3. Paragraphs 45(a), 48(b), 66 (h) and 72 of the ASOC be struck out in accordance with rule 16.21(e) of the FC Rules.

   4. Paragraphs 64L, 64N, 66 (m), 75A, 76A and 76B of the ASOC be struck out in accordance with rule 16.21(e) of the FC Rules.

   5. Further, or in the alternative, the Applicant's claim for compensation and penalties on the basis of the paragraphs of the ASOC identified in 1 to 4 above be summarily dismissed pursuant to rule 13.13(a) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (FCFCA Rules)

   The fifth ground was not pursued, although the respondents sought an order dismissing so much of Mr Farac’s claims as might be struck out. 

2. These reasons concern that interlocutory application. 

   LEGISLATION & RULES

3. Under item 14 of sch.1 to the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth), and r.16.21 of Federal Court Rules 2011 (Cth), all or part of the pleading may be struck out if it fails to disclose a reasonable cause of action. In Leach v Burston [2022] FCA 87 at paragraph 37, Halley J set out the principles relevant to present considerations as follows:

   …

   (a) the power should be employed sparingly and only in a clear case: Polar Aviation Pty Ltd and Another v Civil Aviation Safety Authority and Others (2012) 203 FCR 325; [2012] FCAFC 97 (Polar Aviation) at [42]-[43] (Perram, Dodds-Streeton and Griffiths JJ). Normally, the power to strike out should be exercised where no reasonable amendment could cure the alleged defect: cf Hodson v Pare [1899] 1 QB 455;

   (b) if a pleading is struck out, a Court will ordinarily permit the party to replead unless it would be futile to do so: Nulyarimma v Thompson (1999) 96 FCR 153; [1999] FCA at [208] (Merkel J); Houston at [6];

   (c) a reasonable cause of action means a case with some chance of success having regard to the pleaded allegations. The mere fact that at an interlocutory stage a case appears to be weak is not sufficient to justify striking out the proceeding: Polar Aviation at [42]; cf Davey v Bentinck [1893] 1 QB 185;

   (d) the pleadings must state all material facts necessary to establish the cause of action and the relief sought: Wride v Schulze [2004] FCAFC 216 at [25] (Spender, Tamberlin and Bennett JJ); Bruce v Odhams Press Limited [1936] 1 KB 697 at 712-13 (Scott LJ);

   (e) failure to plead all material facts does not necessitate exercise of the discretion. Restraint will be appropriate where the omission has not caused confusion nor raised substantive principles, or where the deficiency can be resolved through the provision of further particulars or evidence: Deep Investments Pty Ltd v Casey [2018] FCA 603 at [211] (Gleeson J) citing HECEC Australia Pty Ltd v Hydro-Electric Corp [1999] FCA 822 at [59]; State of Queensland v Pioneer Concrete (Qld) Pty Ltd [1999] FCA 499; [1999] ATPR 41-691 at 42,828-9;

   BACKGROUND FACTS

4. Briefly, the chronology of relevant events appears to be as follows.  In 2019 Mr Farac was one of Pendal’s long-term and senior employees and reported to a Mr Gor, whom he alleged bullied him.  Mr Farac alleges that he raised these concerns in relation to Mr Gor’s conduct, initially on an informal basis with Mr Brandweiner and then on 14 October 2019 formally, but obtained no satisfaction.  His formal complaint was referred for investigation by an external organisation.  On 28 November 2019, before the investigation was concluded, Mr Farac was advised of his annual bonus figure, which was one-third less than he had been awarded in the previous year.  On 3 December 2019 he made a formal complaint and inquiries about his bonus figure. 

5. In the meantime, on 26 September 2019 Mr Farac had also taken stress leave.  Ultimately he never returned to work because his position, according to Pendal, became redundant as a result of a restructure.  On 13 March 2020 Mr Farac was told that the investigation of his bullying complaint had been completed and that his complaint had not been made out.  He says that he was not provided with details of the outcome of the investigation. The letter also said that Pendal wanted to obtain detailed medical evidence about Mr Farac’s medical condition and its impact on his capacity to perform the inherent requirements of his role. On 27 April 2020, while he was on stress leave Pendal asked him for a detailed medical report from his doctor, as well as for other information and, he says, indicated that his employment might be terminated if he could no longer perform the inherent requirements of his position. 

6. On 14 July 2020 Mr Farac commenced a proceeding in the Fair Work Commission alleging bullying, which was dismissed in large part on 17 August 2021.  On 16 July 2020 he was advised that his personal leave had been exhausted and that from 14 July 2020 he was on leave without pay.  He also made inquiries in relation to being placed on leave without pay.  On 20 October 2020 this proceeding was commenced and on 28 September 2021 Mr Farac was advised that his role had been made redundant and that his employment would be terminated. 

   Pleadings of Substantive Proceeding

7. Mr Farac alleged that by the following acts or omissions, Pendal took adverse action against him contrary to s.340 of the FW Act:

   (a)issuing the “medical evidence request”, in which on 27 April 2020 Pendal sought medical evidence about his medical condition and its impact on his ability to perform the inherent requirements of his position;

   (b)making the “termination threat” in which Pendal advised him on 27 April 2020 that if upon receipt of the medical report it was determined that he was unable to perform the inherent requirements of his position, it would consider, amongst other things, terminating his employment;

   (c)failing “to provide investigation materials” when on 14 May 2020 Pendal advised him that the only information it would provide him in relation to the bullying investigation was the investigation outcome; and

   (d)failing “to provide redundancy materials”, being Pendal’s failure to provide him with a deed of release and instructions for its execution or with a copy of its redundancy policy prior to notifying him at 4:57pm on 1 October 2021 of the termination of his employment by reason of redundancy, effective immediately. 

8. The allegation of adverse action was relevantly pleaded in the following terms:

   66.      Pendal has taken adverse action against Mr Farac by injuring Mr Farac in the

   Employment by:

   …

   f. the Medical Evidence Request;

   g. the Termination Threat;

   h. the Failure to Provide Investigation Materials;

   …

   m. the Failure to Provide Redundancy Materials;

   …

   CONSIDERATION

9. Two threshold issues were raised during submissions today.  The first was whether, as Mr Farac submitted, the present application in a proceeding is an abuse of process.  A party may commit an abuse of process if they seek particular interlocutory orders after having already been refused them by a Court, and Mr Farac referred to the fact that the respondents had already in 2021 sought orders striking out parts of his pleading and had been partially successful.  However, the orders sought on that occasion were different from the orders sought today, in that different provisions of the pleading were contested, and so the present application does not amount to an abuse of process for being duplicative.

10. The application in a proceeding was also criticised for being oppressive, coming as it did on the second day of the trial listing, albeit the matter has not yet advanced very far at all.  However, for the immediately following reasons I would not, in the exercise of discretion, decline to entertain it or grant it if appropriate.  While, as Mr Farac submitted, the Court is enjoined by its statute to pursue the efficient and inexpensive disposal of matters, and the present application might seem to have defied that objective, I have regard to the fact that it was foreshadowed yesterday as a result of argument over Mr Farac’s notice to produce, and must be understood in the context of that contest.  Moreover, if successful it might shorten the length of the hearing and I conclude, therefore, that the application in a proceeding is not inconsistent with the Court’s objectives. 

11. The principal issue between the parties was whether, assuming all the facts alleged were proved, the statement of claim pleaded an arguable case of adverse action in the form of injury to Mr Farac in his employment by reason of the pleaded acts and omissions, quoted earlier in these reasons. 

12. A lot of the debate today concerned how the FW Act’s expression “injures the employee in his or her employment”, which is relevantly found in item 1(b) of s.342(1) of that Act, should be understood. The meaning of that expression is not necessarily clear and the metes and bounds of its operation and application have been explored in the cases. It is not necessary in these reasons to embark on an analysis of those authorities, as it is sufficient for present purposes to state that, in general terms, the expression concerns practical detriment or harm suffered by an employee in his or her employment.

13. The difficulty I find with Mr Farac’s pleading is that it does not identify what practical detriment or harm he may have suffered as a result of the particular acts and omissions which are identified in the respondent’s application.  At the end of the day, I conclude that the real deficiency in the pleading lies in its failure to particularise the allegations in paragraph 66 of the statement of claim so that the respondents and the Court can understand what injury or injuries Mr Farac says he suffered. 

    CONCLUSION

14. I conclude that the appropriate order to make in response to the respondents’ application in a case is that Mr Farac provide detailed particulars of the allegations made in paragraph 66 of the amended statement of claim, and that he does so as soon as possible. 

I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Cameron.

Associate:

Dated:       21 March 2023