Farrell v Super Retail Group Limited (Confidentiality Applications)

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FEDERAL COURT OF AUSTRALIA

Farrell v Super Retail Group Limited (Confidentiality Applications) [2024] FCA 954  

File numbers: NSD 1009 of 2024
NSD 909 of 2024
Judgment of: LEE J
Date of judgment: 22 August 2024
Catchwords:

PRACTICE AND PROCEDURE – open justice principles and their importance – suppression orders – Pt VAA of the Federal Court of Australia Act 1976 (Cth) – where parties sought interim and final non-publication orders – pseudonym orders – observations as to frequent practice of parties seeking swingeing confidentiality orders – where order must be necessary to prevent prejudice to the administration of justice – where SRG contends the disclosure of the terms of settlement deed would operate as a specific and general disincentive to non-curial resolution – where extant and related Fair Work Commission proceedings – where suppression order sought by SRG not necessary to prevent prejudice to the administration of justice – limited suppression order made pending application for leave to appeal – orders made 

INDUSTRIAL LAW – Fair Work Act 2009 (Cth) – adverse action – whistleblower protection – where applicant was employed by Super Retail Group as Chief Legal Officer and Company Secretary – where applicant alleges that SRG dismissed her following complaints concerning corporate governance issues and health and safety – where applicant seeks specific performance of alleged settlement agreement or damages for breach
Legislation:

Corporations Act 2001 (Cth) ss 674, 677, 1317AAE

Fair Work Act 2009 (Cth) s 368(3)

Federal Court of Australia Act 1976 (Cth) ss 37AF, 37AF(1), 37AG, 37AI(2), 37AJ, 37AE, 37M(2)(d)

Evidence Act 1995 (Cth) Pt 4.6, ss 131(2)(f), 166(f)
Cases cited:

Australian Competition and Consumer Commission v Air New Zealand Limited (No 12) [2013] FCA 533

Australian Competition and Consumer Commission v Cascade Coal Pty Ltd (No 1) [2015] FCA 607; (2015) 331 ALR 68

Australian Competition and Consumer Commission v Valve Corporation (No 5) [2016] FCA 741

Australian Securities and Investments Commission v Australia and New Zealand Banking Group Limited [2023] FCA 256

Azimitabar v Commonwealth of Australia [2023] FCA 760

Bianca Hope Rinehart v Georgina Hope Rinehart [2014] FCA 1241

Chan v Commonwealth of Australia as represented by the NDIS Quality and Safeguards Commission (No 2) [2023] FCA 1538; (2023) 301 FCR 313

Chen v Migration Agents Registration Authority (No 1) [2016] FCA 649

Commonwealth Director of Public Prosecutions v Christian [2019] FCAFC 5; (2019) 268 FCR 84

Computer Interchange Pty Ltd v Microsoft Corporation [1999] FCA 198; (1999) 88 FCR 438

Council of the New South Wales Bar Association v EFA (a pseudonym) [2021] NSWCA 339; (2021) 106 NSWLR 383

Deputy Commissioner of Taxation v State Grid International Australia Development Company Limited (Application for Non-Publication Orders No 2) [2022] FCA 719

Elderslie Finance Corporation Ltd v Newpage Pty Ltd (No 6) [2007] FCA 1030; (2007) 160 FCR 423

Giddings v Australian Information Commissioner [2017] FCAFC 225

Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651

John Fairfax & Sons Pty Ltd v…

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Details
Case
[2024] FCA 954
Decision Date

CaseChat Overview and Summary

In Farrell v Super Retail Group Limited, the parties sought non-publication and suppression orders to prevent the disclosure of certain information related to a workplace dispute. The applicant, Rebecca Farrell, was the Chief Legal Officer and Company Secretary of Super Retail Group Limited (SRG), who alleged that she was dismissed following complaints about corporate governance and health and safety issues. SRG, on the other hand, argued that the disclosure of the terms of the settlement deed would disincentivize non-curial resolution and lead to prejudice in the administration of justice. The court had to decide whether the suppression orders sought by both parties were necessary to prevent prejudice to the administration of justice.

The court found that the suppression orders sought by both parties were unnecessary and hence wrongly sought. The court highlighted that the open justice principle is a fundamental rule of the common law, and suppression orders can only be made if they are necessary to secure the proper administration of justice. The court noted that both parties had sought overly broad and inappropriate confidentiality orders, which is inconsistent with the principle and has been deprecated by Full Courts. The court also emphasized the demanding nature of the statutory test involved in making such orders and the "very heavy" onus that needs to be discharged to obtain such an order. The court concluded that the suppression orders sought by SRG were not necessary to prevent prejudice to the administration of justice.

The court made limited suppression orders pending the application for leave to appeal. These orders prohibited the disclosure of certain material by publication or otherwise, except in specific circumstances such as during private conferences with the Fair Work Commission, confidential mediation, or with prior written consent of the parties. The court also provided liberty to apply to extend or vary the suppression orders. The court further ordered that the suppression orders would be vacated if no application for leave to appeal was brought by a specified date.

In summary, the court dismissed the applications for suppression orders sought by both parties and made limited suppression orders pending the application for leave to appeal. The orders were designed to prevent prejudice to the proper administration of justice while allowing for necessary disclosures in specific circumstances.

Orders

Orders of the court

In NSD 1009 of 2024:

1. The first to fifth respondents’ application for a suppression order referred to in the interlocutory application dated 31 July 2024 (as amended to the form of order provided to the Court on 14 August 2024) be dismissed.

2. Subject to Order 3 below, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) that until 11:00am on 1 October 2024 (and on the ground that it is necessary to prevent prejudice to the proper administration of justice) there be no disclosure, by publication or otherwise, of the material referred to in the schedule to this order (1009 Suppressed Material) other than disclosure by the parties or their legal representatives to:

(a) the Fair Work Commission and its officers and staff, during any private conference conducted under the Fair Work Act 2009 (Cth), in which the first and sixth respondents participate;

(b) any mediator, for the purposes of a confidential mediation to which the first respondent and the applicant are participants;

(c) the legal representatives of Nationwide News Pty Limited and Fairfax Media Publications Pty Limited, for use of the 1009 Suppressed Material for the purpose of making submissions on any application for leave to appeal Order 1 and, if leave be granted, on any appeal;

(d) with the prior written consent of the first respondent; or

(e) by the filing in the Registry of any process or other document that contains any of the 1009 Suppressed Material.

3. In the event no application for leave to appeal Order 1 is brought by 5:00pm on 28 August 2024, Order 2 above be vacated such that no suppression order remains in place.

4. Liberty to apply to extend or vary Order 2 by notification to the Associate to Justice Lee.

5. The Separate Hearing referred to in Order 9 of the Orders dated 7 August 2024 be listed to commence at 10:15am on 1 October 2024.

SCHEDULE

The material:

(a) in paragraphs [21(a)], [21(b)], [21(d)], [21(e)], [21(g)], [21(h)], [21(i)], [21(k)] and [28], in particular (i) under paragraph [33], and in paragraphs [285(a)], [285(b)], [285(d)], [285(e)], [285(g)], [285(h)], [285(i)] and [285(k)] of the statement of claim dated 29 July 2024;

(b) in prayers [11(a)], [11(b)], [11(d)], [11(e)], [11(g)], [11(h)], [11(i)], [11(k)] and [25] of the originating application dated 29 July 2024;

(c) in the following parts of the outline of submissions filed by the first to fifth respondents dated 13 August 2024: paragraph 6, the part of the first sentence of paragraph 16 after the words “inter partes litigation”, and the second sentence of paragraph 16; and

(d) in paragraphs [22(a)], [22(b)], [22(d)] and [22(e)] of the outline of submissions filed by the applicant dated 13 August 2024.

In NSD 909 of 2024:

1. The applicant’s application for a suppression order referred to in the interlocutory application dated 13 August 2024 (as amended to the form of order provided to the Court on 14 August 2024) be dismissed.

2. Subject to Order 3 below, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) that until 11:00am on 1 October 2024 (and on the ground that it is necessary to prevent prejudice to the proper administration of justice) there be no disclosure, by publication or otherwise, of the material referred to in the schedule to this order (909 Suppressed Material) other than disclosure by the parties or their legal representatives to:

(a) the Fair Work Commission and its officers and staff, during any private conference conducted under the Fair Work Act 2009 (Cth), in which the applicant and the second respondent participate;

(b) any mediator, for the purposes of a confidential mediation to which the first respondent and the applicant are participants;

(c) the legal representatives of Nationwide News Pty Limited and Fairfax Media Publications Pty Limited, for use of the 909 Suppressed Material for the purpose of making submissions on any application for leave to appeal Order 1 and, if leave be granted, on any appeal;

(d) with the prior written consent of the applicant; or

(e) by the filing in the Registry of any process or other document that contains any of the 909 Suppressed Material.

3. In the event no application for leave to appeal Order 1 is brought by 5pm on 28 August 2024, Order 2 above be vacated such that no suppression order remains in place.

4. Liberty to apply to extend or vary Order 2 by notification to the Associate to Justice Lee.

SCHEDULE

The material:

(a) in paragraphs [21(a)], [21(b)], [21(d)], [21(e)], [21(g)], [21(h)], [21(i)], [21(k)] and [28], in particular (i) under paragraph [33], and in paragraphs [285(a)], [285(b)], [285(d)], [285(e)], [285(g)], [285(h)], [285(i)] and [285(k)] of the statement of claim dated 29 July 2024;

(b) in prayers [11(a)], [11(b)], [11(d)], [11(e)], [11(g)], [11(h)], [11(i)], [11(k)] and [25] of the originating application dated 29 July 2024;

(c) in the following parts of the outline of submissions filed by the first to fifth respondents dated 13 August 2024: paragraph 6, the part of the first sentence of paragraph 16 after the words “inter partes litigation”, and the second sentence of paragraph 16; and

(d) in paragraphs [22(a)], [22(b)], [22(d)] and [22(e)] of the outline of submissions filed by the applicant dated 13 August 2024.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The application for suppression orders the subject of these reasons is novel, and I do not propose to make them, but they have been calibrated with more care than is sometimes the case. For reasons I will explain, however, each side of this dispute has sought some non-publication type orders in these proceedings unnecessarily and hence wrongly. B THE BACKGROUND TO THE PROCEEDINGS It is first necessary to trace some background. The facts emerge from the three affidavits read at the interlocutory hearing, which were not cross-examined upon; nor were they the subject of objection. Nor was any limitation as to use sought in relation to the representations referred to in the affidavits (or contained in the documents annexed or Exhibits SM-1 and SM-2) (T4–5). The applicant, Ms Rebecca Farrell, was employed as the Chief Legal Officer and as a company secretary of the first respondent, Super Retail Group Limited (SRG) between February 2020 and May 2024. From approximately September 2023, Ms Farrell contends an employment dispute arose between her and SRG. Shortly thereafter, on 11 December 2023, SRG became aware that Harmers Workplace Lawyers LP (Harmers) acted for Ms Farrell, and Ms Farrell commenced a period of leave from her employment. In January 2024, the General Manager, Group Secretariat and Corporate Legal at SRG, the sixth respondent, Ms Amelia Berczelly, commenced a period of leave from her employment. Harmers commenced acting for Ms Berczelly in December 2023. In February 2024, SRG became aware Harmers also acted for her. SRG engaged solicitors (Allens) and, from February 2024 onwards, Allens engaged in various “without prejudice” communications with Harmers. A mediation arranged before a former Registrar of this Court, Mr Tony Tesoriero, was conducted on 17 April 2024, which was attended by representatives of SRG, Ms Farrell and (part way through and by telephone) Ms Berczelly. Legal representatives were also present. Although I was not taken to any evidence suggesting Ms Berczelly was bound by a contractual obligation of confidence (unlike the other parties), there is no doubt the mediation was confidential and I would infer she is bound by equitable duties of confidence. The mediation was also unsuccessful. Although we do not know what occurred during the mediation, it is reasonable to conclude that discussion would have taken place between the parties as to the nature and proposed likely quantum of the claims made by Ms Farrell and Ms Berczelly. What next happened is noteworthy. SRG is an entity listed on the Australian Securities Exchange (ASX) and, on 26 April 2024, it “released an ASX announcement about expected workplace litigation”. The announcement was as follows: 26 April 2024ASX AnnouncementEXPECTED WORKPLACE LITIGATIONThe Board of Super Retail Group Limited (ASX: SUL) today announces that the Group expects two employees, represented by Harmers Workplace Lawyers, will shortly commence court proceedings against the Group. The Group expects the employees to jointly claim loss and damage in the range of $30 million to $50 million.The Group expects that the allegations in the proceedings will include: the non-disclosure of a relationship between Anthony Heraghty, the Group Managing Director & Chief Executive Officer, and the former Chief Human Resources Officer (who is not one of the two employees making the claim); inappropriate company travel; bullying, victimisation and adverse treatment; particular employees in the corporate team having unreasonable workloads, insufficient resources and restricted access to information; and unsatisfactory company record management.The Board has conducted a review and investigations into these allegations. The Board was supported by independent external advisers. The Board's review and investigations concluded that none of the allegations are substantiated.Super Retail Group will defend any court proceedings in relation to the allegations. Allens is acting for the Group.As these matters are expected to be the subject of litigation, the Group does not intend to make any further comment at this time. The Group will update the market on this matter as appropriate.The release of this announcement has been authorised by the Board of Super Retail Group. (Emphasis added)

Evidence

Evidence Before The Court

The authorities at common law are well known. In a case referred to and applied on innumerable occasions, McHugh JA in John Fairfax & Sons Pty Ltd v Police Tribunal of New South Wales (1986) 5 NSWLR 465 (at 476–477) stressed: The fundamental rule of the common law is that the administration of justice must take place in open court. A court can only depart from this rule where its observance would frustrate the administration of justice or some other public interest for whose protection Parliament has modified the open justice rule. The principle of open justice also requires that nothing should be done to discourage the making of fair and accurate reports of what occurs in the courtroom. Accordingly, an order of a court prohibiting the publication of evidence is only valid if it is really necessary to secure the proper administration of justice in proceedings before it. Moreover, an order prohibiting publication of evidence must be clear in its terms and do no more than is necessary to achieve the due administration of justice. The making of the order must also be reasonably necessary; and there must be some material before the court upon which it can reasonably reach the conclusion that it is necessary to make an order prohibiting publication. Mere belief that the order is necessary is insufficient. (Emphasis added) But despite these sorts of exhortations, it is an everyday occurrence to see practitioners, even highly experienced practitioners, seeking suppression and non-publication type orders of various types on an impermissibly broad and infirm basis. Moreover, one sometimes comes across examples, particularly in duty matters, of extensive suppression and non-publication orders being proposed (and sometimes made) by consent without the benefit of detailed submissions or analysis – despite the caution of Lord Woolf MR that it is when both sides agree that information should be kept from the public that the Court should be “most vigilant”: R v Legal Aid Board; Ex parte Kaim Todner (a firm) [1999] QB 966 (at 977)). The widespread practice of seeking inappropriate, or inappropriately broad, confidentiality and suppression orders remains the case notwithstanding this phenomenon is inconsistent with principle and has been deprecated by Full Courts (and judges in the original jurisdiction) who have repeatedly sought to remind the profession of the express statutory limits on the making or such orders; the demanding nature of the statutory test involved; and the “very heavy” onus that needs to discharged in order to obtain such an order: see, for example, Giddings v Australian Information Commissioner [2017] FCAFC 225 (at [25] per Collier, Flick and Charlesworth JJ); Commonwealth Director of Public Prosecutions v Christian [2019] FCAFC 5; (2019) 268 FCR 84 (at 110 [121] per Besanko, Flick and Robertson JJ); Mensink v Registrar of the Federal Court of Australia [2022] FCAFC 102; (2022) 294 FCR 101 (at 117 [76]–[77] per Bromwich, Lee and Thawley JJ); Computer Interchange Pty Ltd v Microsoft Corporation [1999] FCA 198; (1999) 88 FCR 438 (at 442–443 [16] per Madgwick J); Australian Competition and Consumer Commission v Air New Zealand Ltd (No 12) [2013] FCA 533 (at [7] per Perram J); Bianca Hope Rinehart v Georgina Hope Rinehart [2014] FCA 1241 (at [28] per Jacobson J); Australian Competition and Consumer Commission v Cascade Coal Pty Ltd (No 1) [2015] FCA 607; (2015) 331 ALR 68 (at 74 [30] per Foster J); Australian Competition and Consumer Commission v Valve Corporation (No 5) [2016] FCA 741 (at [8] per Edelman J); Liverpool City Council v McGraw-Hill Financial, Inc [2018] FCA 1289 (at [110] per Lee J); Deputy Commissioner of Taxation v State Grid International Australia Development Company Limited (Application for Non-Publication Orders No 2) [2022] FCA 719 (at [23]–[24] per Thawley J); Liverpool City Council v McGraw-Hill Financial, Inc [2018] FCA 1289 (at [110] per Lee J); R&B Investments Pty Ltd (Trustee) v Blue Sky Alternative Investments Limited (Administrators Appointed) (in liq) (Confidentiality Orders) [2022] FCA 1443 (at [4] per Lee J); Australian Securities and Investments Commission v Australia and New Zealand Banking Group Limited [2023] FCA 256 (at [113] per O’Bryan J); Azimitabar v Commonwealth of Australia [2023] FCA 760 (at [303] per Murphy J); Chan v Commonwealth of Australia as represented by the NDIS Quality and Safeguards Commission (No 2) [2023] FCA 1538; (2023) 301 FCR 313 (at 339–340 [114] per Shariff J); and Kyle-Sailor v Heinke [2024] FCA 431 (at [25] per Horan J).

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

As is well known, by reason of being a listed entity, SRG has obligations under the Corporations Act 2001 (Cth) (Corporations Act) and ASX Listing Rule 3.1 to disclose immediately information concerning SRG that was not generally available and that a reasonable person would expect, if generally available, to have a material effect on the price or value of SRG’s securities (subject to exceptions I am not required to detail for present purposes). A reasonable person is taken to expect information to have a material effect on the price or value of securities where the information would or would be likely to influence persons who commonly invest in securities in deciding whether to acquire or dispose of those securities. Any announcement to the ASX under Listing Rule 3.1 is required to be accurate, complete, and not misleading, and any opinions expressed in an announcement should be honestly held and balanced (see ASX Listing Rules, Guidance Note 8). It is reasonable to proceed on the basis that SRG contends it made a responsible and proper announcement to the ASX in that the entity announced material information and it constituted a true picture of the nature of the claims by Ms Farrell and Ms Berczelly (of which officers of SRG were then aware within the meaning of Listing Rule 3.1) and that the total claim for loss and damage being made was in the range of $30 million to $50 million. The announcement occasioned widespread media interest and publicity. This is amply demonstrated by newspaper articles that were adduced in evidence. This material also reveals the controversial nature of the dispute, including referencing “sources close to Super Retail” alleging the use of “shake down” tactics. By way of example, on 28 April 2024, in an article published in The Australian, the following appears:Shopping giant Super Retail Group offered to settle a legal claim from at least two rogue executives over an alleged secret affair between its chief executive and its HR manager, but it was rejected after the offer fell well short of a $50m payday they expected …Harmers Workplace Lawyers ... engaged in mediation talks with Super Retail earlier this year as it sought losses and damages on behalf of its clients that could be worth $30m to $50m. Those mediation talks later failed, The Australian can reveal, with offers of a settlement raised by the company but not accepted. The failure of mediation to find a workable solution and growing fears it was being held to ransom on baseless allegations led Super Retail on Friday go on the offensive by revealing to the Australian Stock (sic) Exchange that it was being pursued by lawyers acting for two current, female Super Retail executives making a number of scandalous claims and potentially chasing as much as a $50m payout …Super Retail ... conducted a full investigation into the allegations… This later gave the board the confidence to publicly back its CEO, who has publicly professed a management style that includes getting ahead of a crisis before it breaks.Internally, Super Retail also believes it is the victim of baseless allegations dressed up as potent legal threats and wielded to trigger a payday for the clients. One source had referred to the claims as akin to a “shakedown or blackmail” with the retailer deciding to go on the offensive rather than pay off the employees to go away.(Emphasis added)