Ferngrove Pharmaceuticals Pty Ltd v Mr Chuan Wei Ji

[2017] FWC 3503

[2017] FWC 3503

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.604 - Appeal of decisions

Ferngrove Pharmaceuticals Pty Ltd
v
Mr Chuan Wei Ji
(C2017/3519)

DEPUTY PRESIDENT COLMAN MELBOURNE, 5 JULY 2017

Appeal against decision [2017] FWC 2999 of Deputy President Sams at Sydney on 8 June 2017 in matter number U2016/15442 – stay of decision

[1] This decision concerns an application for a stay order by Ferngrove Pharmaceuticals Pty Ltd (Ferngrove). The stay order is sought pursuant to s606 of the Fair Work Act 2009 (the Act) in relation to an appeal lodged against a decision of Deputy President Sams. In that decision, the Deputy President determined that Mr Chuan Wei Ji had been unfairly dismissed and ordered compensation be paid to Mr Ji in the amount of $14,592.00 gross, plus 9.5% superannuation, within 21 days.

[2] Section 606(1) of the Act provides as follows:

(1) If, under section 604 or 605, the FWC hears an appeal from, or conducts a review of, a decision, the FWC may (except as provided by subsection (3)) order that the operation of the whole or part of the decision be stayed, on any terms and conditions that the FWC considers appropriate, until a decision in relation to the appeal or review is made or the FWC makes a further order.

[3] Ferngrove seeks a stay of the whole of the order of Deputy President Sams. The practical effect of a stay would be to suspend the obligation to pay the compensation until the appeal in this matter is determined.

Principles for staying the operation of a decision or order

[4] It is well established that, in deciding whether to exercise its discretion to grant a stay order, the Commission must first be satisfied that the appellant has an arguable case with some reasonable prospects of success, both in respect of permission to appeal and the substantive merits of the appeal. 1 In addition, the balance of convenience must weigh in favour of the order subject to appeal being stayed.2

[5] The principles applicable to the granting of a stay in the present case should be applied against the statutory framework that applies to appeals against unfair dismissal decisions. Unlike appeals against decisions made under other provisions of the Act, permission to appeal a decision under Part 3-2 (unfair dismissals) will only be granted if the Commission considers it to be in the public interest to do so. 3 Accordingly, there is a higher threshold for permission to appeal against an unfair dismissal decision.4

[6] Further, to the extent that an appeal is on a question of fact, it can only be made on the ground that the relevant decision involved a significant error of fact. 5

[7] More generally, other errors said to have been made by the first instance decision-maker must be of a kind identified by the High Court in House v R. 6

Background

[8] Mr Ji was dismissed from his employment for allegedly having stolen product from the company’s pharmaceutical production plant. Mr Tang, the managing director of Ferngrove, was approached by Mr Ji’s ex-wife, Ms Chen, with a ‘tip off’. She provided Mr Tang with several containers of ‘EPO’ products, and a container of ‘Krill Oil capsules’, which she said her former husband had stolen. Some of the capsules were flawed and appeared to Ferngrove to be defective product from its factory.

[9] Mr Ji was summarily dismissed. He did not learn that his ex-wife was the source of the allegations against him until the conciliation conference before the Commission three months later. 7

[10] The unfair dismissal proceedings before the Commission were conducted as a determinative conference. Mr Tang and Mr Ji gave evidence with the assistance of a Mandarin interpreter. Ms Chen also gave evidence.

[11] In his decision, the Deputy President had regard to the sworn evidence of the three witnesses. He concluded that Mr Ji’s alleged misconduct had not been proved, and that there was no valid reason for his dismissal. 8 He noted Mr Tang’s evidence that the sole reason for the dismissal was the ‘tip-off’ that had been provided by Ms Chen.9 However, the Deputy President found Ms Chen’s evidence to be unreliable.

[12] As to the allegedly stolen product, which Ms Chen had provided to Mr Tang, the Deputy President found that ‘the fact that the products in the three containers were loose, could be bought from a chemist and could well have deteriorated because they were ‘very old’, does not prove they were sourced from the respondent’s factory’. 10

Grounds of appeal

[13] Ferngrove’s grounds of appeal comprise 13 paragraphs with a common theme, namely that the decision of the Deputy President involved significant errors of fact. The alleged errors are set out in paragraphs 8 to 13 of the Notice of Appeal.

[14] In paragraph 7, Ferngrove submitted that any person with expertise in capsule production would appreciate that the capsules ‘could only have come from the factory – and not from a retail outlet – because it contained some flawed capsules that would always be removed before product was released for sale’. 11

[15] In paragraph 8, it was contended that the Deputy President wrongly interpreted the defects in the capsules to be the result of age; but that in fact capsules do not deteriorate with age. To the company, the defects in the product were ‘conclusive evidence’ that the product was taken from its factory. 12

[16] Paragraph 9 is difficult to understand. At the stay hearing, I asked Mr Scott, who appeared for the company, to clarify its meaning. He responded that this ground contends that the product in question was old, having hardened and darkened, and that this is consistent with the product having been stolen from the factory some time ago, by Mr Ji, not more recently, by Ms Chen. 13

[17] Paragraph 10 of the Notice of Appeal focused on the Deputy President’s finding that Ms Chen was an unreliable witness. Ferngrove submits that this finding was of no relevance to the company’s decision to dismiss Mr Ji because of the physical evidence referred to in the preceding paragraphs.

[18] In paragraph 11, it was claimed that some of Mr Tang’s evidence was misunderstood. At paragraph 34 of the decision, Mr Tang is said to have conceded that the three containers of (EPO) product could easily have been bought from a chemist; Ferngrove contends that his evidence was taken out of context, and that in fact he was saying that this type of product – not the particular specimens before the Commission – could be obtained from a chemist.

[19] In paragraph 12, Ferngrove submitted that the Deputy President was wrong to conclude that ‘loose’ product is ‘less valuable as evidence’, when in fact loose product is ‘consistent with product stolen from the production area’.

[20] In paragraph 13, Ferngrove contended that all of the elements of the evidence that the company relied on when making its decision to dismiss Mr Ji were consistent with theft, and that the Deputy President’s conclusion that the allegation of theft was unsubstantiated was ‘contrary to the overwhelming weight of evidence.’

[21] Finally, at the stay hearing, the company stated that it would seek to lead fresh evidence in the appeal concerning the provenance of the product that Ms Chen gave to Mr Tang, including an analysis that was undertaken of the active ingredients in the product, following the decision of the Deputy President. This is said to demonstrate that the product came from the company’s factory. 14

[22] The grounds of appeal are not matters that are to be determined in this stay application. Rather, the question to be determined is whether the order made by Deputy President Sams on 8 June 2017 should be stayed. The purpose of examining the grounds of appeal is to consider whether they disclose an arguable case of error, with some reasonable prospect of success on appeal.

Arguable case with some reasonable prospect of success

[23] The appellant’s appeal grounds in paragraphs 7, 8, 9, 11 and 12 all go to the argument that the product provided by Ms Chen to Mr Tang must have come from Ferngrove’s factory. However, even if it were accepted that the product did come from the factory, it does not follow that Mr Ji took the product. As the Deputy President explained in his decision, this is a matter which must be proved, on the balance of probabilities. 15 There appears to be no evidence that it was Mr Ji who took the product from the factory, aside from the evidence of Ms Chen.

[24] In this regard, the Deputy President made a finding of fact concerning the credibility of Ms Chen as a witness. He found her evidence unreliable. 16 By contrast, he found Mr Ji to be a witness of truth, whose evidence that he had never stolen anything was to be believed.17

[25] Contrary to the contention of Ferngrove in paragraph 10 of the Notice of Appeal, the Deputy President’s finding concerning the reliability of Ms Chen as a witness is highly relevant, because Ms Chen was the source of the allegations against Mr Ji. If Ms Chen’s evidence is unreliable, the link between Mr Ji and the product becomes tenuous. As noted in the Deputy President’s decision, where the reason for termination is based on the misconduct of an employee, the Commission must determine whether the conduct occurred. 18 The Deputy President concluded that the alleged misconduct had not been substantiated.19

[26] In relation to the grounds of appeal in paragraphs 7, 8, 9, 10, 12 and 13, it is my view that Ferngrove has not made out an arguable case with some reasonable prospect of success. In particular, I find it difficult to see how any of the alleged errors in these paragraphs could be described as significant.

[27] This leaves me to consider the ground in paragraph 11 of the Notice of Appeal. This ground concerns an alleged misapprehension by the Commission as to the intended meaning of Mr Tang’s evidence about the availability of certain products in chemists. This is a matter of potential significance. It is possible that on this issue, the limitations of Mr Tang’s English language capacity prevented him from conveying his evidence effectively, and that something might have been missed in translation, despite the good endeavours of the interpreter.

[28] It is a matter of public interest that access to justice should be afforded to the entire community, including those with a more limited command of English, and in this regard the Commission makes available the services of qualified interpreters. Nonetheless, in an unfair dismissal context, to the extent that a problem of translation results in an alleged error of fact, it must none the less be a significant one.

[29] The significance of the alleged error here is that Ferngrove’s argument that the product in evidence came from its factory might have been stronger. However, as noted above, even if this element of Ferngrove’s argument is accepted, there is no evidence substantiating the allegation that it was Mr Ji who took the product from the factory.

[30] As to the company’s intention to lead fresh evidence on appeal, s607(2) of the Act confers on a Full Bench a discretion to admit further evidence and take into account any other information or evidence. It will be for the appeal bench in this matter to decide whether to exercise this discretion. However, in Loftus 20, a Full Bench of the Commission stated that an appeal ought not be an occasion for a party to run an improved case, and that an appeal bench would not generally admit fresh evidence to the consideration of an appeal which was able to be provided at the initial hearing.21

[31] Ferngrove may be able to develop its various arguments on appeal. However, in the context of the higher threshold for permission to appeal and the requirement that any alleged errors of fact be significant, I am not presently satisfied that Ferngrove has made out an arguable case, with some reasonable prospects of success as to the merit of an appeal or as to permission to appeal.

[32] The application for a stay is dismissed.

DEPUTY PRESIDENT

Appearances:

Mr R. Scott, for Ferngrove

Mr C. W. Ji, for himself

Hearing details:

2017.

Melbourne

Sydney (video link)

4 July.

 1   Kellow-Falkiner Motors Pty Ltd v Edghill Print S2639, 24 January 2000 at [5]; applied in Bank of Sydney Ltd v Repici[2015] FWC 5511 et al.

 2   Ibid. See also Coal and Allied Operations Pty Limited v Crawford and Others (2001) 109 IR 409 at [13].

 3   Section 400(1) of the Act

 4   WorkPac Pty Ltd v Bambach (2012) 220 IR 313; FWAFB 3206 at 14.

 5   Section 400(2) of the Act

 6   House v R (1936) 55 CLR 499

 7   Paragraph 3 of the decision.

 8   Paragraph 36 of the decision.

 9   Paragraph 32 of the decision.

 10   Paragraph 34 of the decision.

 11   See PN74 of transcript, which makes clear that the reference in the notice of appeal to ‘the factory’ is intended to be a reference to Ferngrove’s factory.

 12   Paragraph 8 of the Notice of Appeal.

 13   PN36, transcript of stay proceedings.

 14   PN15 and PN19, transcript of stay proceedings.

 15   Paragraph 26 of the decision.

 16   Paragraph 33 of the decision; see also paragraphs 36 and 50.

 17   Paragraph 35 of the decision.

 18   Paragraphs 27 and 28 of the decision.

 19   Paragraph 36 of the decision.

 20   Appeal by Loftus, [2014] FWCFB 1978.

 21   Ibid at paragraph 17.

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