FEDERAL COURT OF AUSTRALIA
Fowler v Airservices Australia [2009] FCA 1189
PRACTICE AND PROCEDURE – Court approval of representative proceeding – group members tightly confined and have provided continuing instructions to applicant’s solicitors – all group members have approved proposed settlement – global settlement sum and settlement distribution method specified – counsel and solicitors recommend settlement - whether any further notice required pursuant to s 33X(4) of the Federal Court Act - whether settlement is fair and reasonable – whether global settlement sum should be kept confidential
Federal Court Act 1976 (Cth) ss 33V, 33X
Australian Competition and Consumer Commission v Chats House Investments Pty Limited (1996) 71 FCR 250 cited
Darwalla Milling Co Pty Ltd v F Hoffman-La Roche Ltd (No 2) (2006) 236 ALR 322 applied
Haslam v Money For Living (Aust) Pty Limited (Administrators Appointed) [2007] FCA 897 cited
Lopez v Star World Enterprises Pty Limited (1999) ATPR 41-678 cited
Multiplex Funds Management v P Dawson Nominees (2007) 164 FCR 275 cited
Taylor v Telstra Corporation Ltd [2007] FCA 2008 cited
Williams v FAI Homes Security Pty Ltd(No 4) (2000) 180 ALR 459 consideredMERVYN FOWLER v AIRSERVICES AUSTRALIA
ACD 48 of 2007
BENNETT J
19 OCTOBER 2009
CANBERRA (HEARD IN SYDNEY)
IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY
DISTRICT REGISTRY
GENERAL DIVISION
ACD 48 of 2007
BETWEEN: MERVYN FOWLER
ApplicantAND: AIRSERVICES AUSTRALIA
Respondent
JUDGE:
BENNETT J
DATE OF ORDER:
19 OCTOBER 2009
WHERE MADE:
CANBERRA (HEARD IN SYDNEY)
THE COURT ORDERS THAT:
1.The settlement as detailed in the Deed of Release and Confidentiality exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “HMW-E4” be approved pursuant to s 33V(1) of the Federal Court of Australia Act 1976 (Cth) (the ‘Settlement’).
2.The method of proposed distribution of the monies to be paid under the Settlement as set out in the spreadsheet exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “Amended HMW-E6” be approved pursuant to s 33V(2) of the Federal Court of Australia Act 1976 (Cth).
3.The documents exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “HMW-E1”, “HMW-E2”, “HMW-E5” and “HMW-E7” are confidential and are not required to be served on the Respondent and are to be kept on the Federal Court of Australia file in a sealed envelope marked “Not to be opened without leave of a Justice of the Federal Court of Australia” and that should any application be made to release these documents, notice of such application be first given to the Applicant’s solicitors.
4.So much of the documents exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked clause 2.1 of “HMW-E3”, clause 2.1 of “HMW-E4”, “HMW-E6” and “Amended HMW-E6” are confidential and are to be kept on the Federal Court of Australia…
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- AGLC
- Fowler v Airservices Australia [2009] FCA 1189
- Case
- [2009] FCA 1189
- Decision Date
CaseChat Overview and Summary
The legal issues before the court were whether Airservices was required to pay pro-rata bonuses and amounts in lieu of accrued leave at a rate which included a bonus component, and whether it had made certain representations during negotiations with the Deacons clients. The court had to determine whether the proposed settlement was fair and reasonable for the Deacons clients, and whether the confidentiality of certain documents and information should be maintained. The court reviewed the evidence and submissions from both parties, and assessed the settlement based on the criteria of fairness and reasonableness. The court considered the advice provided to the Deacons clients by their solicitors and counsel, and the absence of any objections or claims of unfairness from the group members.
The court found that the proposed settlement, the methodology for distribution, and the confidentiality of certain documents were fair and reasonable for the Deacons clients. The court noted that the Deacons clients had received legal advice on the litigation and the proposed settlement, and that no objections or claims of unfairness had been raised by any group member. The court also found that the global settlement amount and the distribution methodology had been adequately set forth to the Deacons clients, and that the proposed settlement was in the interests of the group members as a whole. The court approved the settlement and the confidentiality provisions as requested by the parties. The Deacons clients and Airservices Australia agreed to settle their dispute for a global amount, with the terms of the settlement to be kept confidential. The court's decision in Fowler v Airservices Australia provides guidance on the factors to consider when approving a settlement under Section 33V of the Federal Court Act, and the importance of ensuring that the settlement is fair and reasonable for all parties involved.
Orders
Orders of the court
1. The settlement as detailed in the Deed of Release and Confidentiality exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “HMW-E4” be approved pursuant to s 33V(1) of the Federal Court of Australia Act 1976 (Cth) (the ‘Settlement’).
2. The method of proposed distribution of the monies to be paid under the Settlement as set out in the spreadsheet exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “Amended HMW-E6” be approved pursuant to s 33V(2) of the Federal Court of Australia Act 1976 (Cth).
3. The documents exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked “HMW-E1”, “HMW-E2”, “HMW-E5” and “HMW-E7” are confidential and are not required to be served on the Respondent and are to be kept on the Federal Court of Australia file in a sealed envelope marked “Not to be opened without leave of a Justice of the Federal Court of Australia” and that should any application be made to release these documents, notice of such application be first given to the Applicant’s solicitors.
4. So much of the documents exhibited to the affidavit of Heather Maree Wilson sworn on 16 September 2009 and marked clause 2.1 of “HMW-E3”, clause 2.1 of “HMW-E4”, “HMW-E6” and “Amended HMW-E6” are confidential and are to be kept on the Federal Court of Australia file in a sealed envelope marked “Not to be opened without leave of a Justice of the Federal Court of Australia” and that should any application be made to release these document, notice of such application be first given to the Applicant’s solicitors and to the Respondent’s solicitors.
5. Paragraph 19 of the Outline of Submissions filed by the Respondent on 17 September 2009 be kept confidential.
Note:
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Established by: BENNETT J
By evidence and submission Airservices has set out the issues and its position in relation to the claim made against it. In summary, should the proceedings progress to a full hearing, Airservices would submit that, on a proper interpretation of the terms of the Contract and letters of offer entered into by the Deacons clients and Airservices, Airservices was not required to pay a pro-rata bonus on termination of employment to the Deacons clients. Airservices would argue that, on a proper interpretation of the terms of the relevant contracts of employment and letters of offer and the Long Service Leave (Commonwealth Employees) Act 1976, it was not required to pay to any Deacons client on termination of employment an amount in lieu of accrued but untaken annual leave or long service leave at a rate which included a bonus component. Further, Airservices denies making the representations that the Deacons clients claim were made during the course of negotiation and explanation of the Contract to them.CONSIDERATIONThe Court’s approach under Section 33V of the Federal Court Act As Branson J said in Australian Competition and Consumer Commission v Chats House Investments Pty Limited (1996) 71 FCR 250 at 258: ‘it is appropriate for the Court to be satisfied that any settlement or discontinuance of representative proceedings has been undertaken in the interests of the group members as a whole, and not just in the interests of the applicant and the respondent’. The Court’s task is to assess whether the compromise is fair and reasonable (Lopez v Star World Enterprises Pty Limited (1999) ATPR 41-678; [1999] FCA 104 at [15] per Finkelstein J). In the present case, each Deacons client has had the benefit of advice from solicitors and counsel as to how his or her interests are best served in the litigation and by the proposed settlement. My task is to determine whether the proposed settlement is fair and reasonable having regard to the claims made on behalf of the group members who will be bound by the settlement (Williams v FAI Homes Security Pty Ltd (No 4) (2000) 180 ALR 459 at [19] per Goldberg J). While the nine factor test adopted by Goldberg J in Williams is not a rigid test to be applied, it is useful as a guide (Haslam v Money For Living (Aust) Pty Limited (Administrators Appointed) [2007] FCA 897 at [20] per Gordon J.) The approach to be taken by the Court was recently reviewed by Jessup J in Darwalla Milling Co Pty Ltd v F Hoffman-La Roche Ltd (No 2) (2006) 236 ALR 322. Jessup J pointed out that there is little specificity that can be attached to the words “fair” or “reasonable”. His Honour expressed the opinion that the practical judicial approach appears to be to identify any features of a settlement that are obviously unreasonable or unfair (Darwalla at [39]). The evidence establishes that the proposed global amount, the methodology for distribution and the effect of the settlement on the payments to be made to the individual members has been adequately set forth to each of those members of the Deacons client group. As was the case in Darwalla, no objection, and no matter said to be unfair or unreasonable, has been raised in this case by any group member who will be covered by the settlement. As a result, I, like Jessup J in Darwalla, am left with only the broadest criteria to assess the reasonableness and fairness of the proposed settlement. Global settlement sum