Foxton v ACN 128 543 304 Pty Ltd (In Liquidation) & Ors and Robinson v ACN 128 543 304 Pty Ltd (In Liquidation)
[2018] FCCA 3345
•22 November 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| FOXTON v ACN 128 543 304 PTY LTD (In Liquidation) & ORS and ROBINSON v ACN 128 543 304 PTY LTD (In Liquidation) & ORS | [2018] FCCA 3345 |
| Catchwords: PRACTICE AND PROCEDURE – Whether material facts supporting a claim of accessorial liability properly pleaded. |
| Legislation: Fair Work Act 2009 (Cth), s.550. Federal Circuit Court of Australia Act 1999 (Cth), s.42 |
| Aon Risk Services Australia Limited v Australian National University [2009] HCA 27; (2009) 239 CLR 175; (2009) 83 ALJR 951; (2009) 258 ALR 14 Australian Securities & Investments Commissionv Rich (2004) 220 CLR 129; (2004) 78 ALJR 1354 Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union v John Holland Pty Ltd ACN 004 282 268 [2009] FCA 274; (2009) 180 IR 350 Fair Work Ombudsman v Centennial Financial Services Pty Ltd & Ors [2010] FMCA 863; (2010) 245 FLR 242; (2010) 63 AILR 101-278 Fortron Automotive Treatments Pty Ltd v Jones & Ors [2008] FMCA 622; (2008) 222 FLR 1 Kirk & Anor v Industrial Court of New South Wales [2010] HCA 1; (2010) 239 CLR 531; (2010) 84 ALJR 154; (2010) 190 IR 437; (2010) 262 ALR 569; (2010) 113 ALD 1 Rasomen Pty Ltd v Shell Company of Australia Ltd (1997) 75 FCR 216; (1997) 144 ALR 497 Trade Practices Commission v Madad Pty Ltd (1979) 40 FLR 453 WZASX v Minister for Immigration & Border Protection [2017] FCA 1415 |
| Applicant: | DAMIEN FOXTON |
| First Respondent: | ACN 128 543 304 PTY LTD (IN LIQUIDATION) |
| Second Respondent: | KYLE ARNOLD |
| Third Respondent: | BEVERLEY ARNOLD |
| File Number: | SYG 2406 of 2012 |
| Applicant: | PAUL ROBINSON |
| First Respondent: | ACN 128 543 304 PTY LTD (IN LIQUIDATION) |
| Second Respondent: | KYLE ARNOLD |
| Third Respondent: | BEVERLEY ARNOLD |
| File Number: | SYG 2407 of 2012 |
| Judgment of: | Judge Antoni Lucev |
| Hearing dates: | 3-4 December 2013 |
| Date of Last Submission: | 4 December 2013 |
| Delivered at: | Perth (by telephone to Sydney) |
| Delivered on: | 22 November 2018 |
REPRESENTATION (in both SYG2406 of 2012 and SYG2407 of 2012)
| Counsel for the Applicants: | Mr T Glover |
| Solicitors for the Applicants: | FCB Workplace Law |
For the First Respondents: | No appearance | |
| For the Second Respondents: | In person | |
| Solicitors for the Second Respondents: | Clinch Long Letherbarrow | |
| Counsel for the Third Respondents: | Mr R Moore | |
| Solicitors for the Third Respondents: | Lawyers Chambers on Riley Pty Ltd | |
ORDERS –SYG 2406 of 2012
That the applicant file and serve an Amended Statement of Claim by 24 December 2018.
That the proceedings be adjourned to a directions hearing at 9.30am (WST) on 24 January 2019.
Costs, if any, reserved.
ORDERS –SYG 2407 of 2012
That the applicant file and serve an Amended Statement of Claim by 24 December 2018.
That the proceedings be adjourned to a directions hearing at 9.30am (WST) on 24 January 2019, with leave to the parties to appear by video-link from the Sydney Registry of the Court.
Costs, if any, reserved.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2406 of 2012
| DAMIEN FOXTON |
Applicant
And
| ACN 128 543 304 PTY LTD (IN LIQUIDATION) |
First Respondent
| KYLE ARNOLD |
Second Respondent
| BEVERLEY ARNOLD |
Third Respondent
SYG 2407 of 2012
| PAUL ROBINSON |
Applicant
And
| ACN 128 543 304 PTY LTD (IN LIQUIDATION) |
First Respondent
| KYLE ARNOLD |
Second Respondent
| BEVERLEY ARNOLD |
Third Respondent
REASONS FOR JUDGMENT
Introduction
These are proceedings which concern two matters under the Fair Work Act 2009 (Cth) (“FW Act”) in relation to allegations of underpayment of employee entitlements, failure to keep employee records and failure to provide payslips. The two matters were listed for hearing together. The two matters have a lengthy and complex interlocutory history, primarily before two other Judges of this Court. It is unnecessary to recite all of that history for present purposes (although some of it is adverted to below), but it is necessary at the outset to observe that on the day prior to the commencement of the listed hearing, and in the course of dealing with an application by the second respondent (who then appeared by Counsel) to set aside certain subpoenas, particularly as they related to penalty issues, the Court made an order that the two days of hearing listed be as to liability only, as separate liability and penalty hearings are usual (other than in the simplest matters) in federal civil penalty proceedings: Trade Practices Commission v Madad Pty Ltd (1979) 40 FLR 453 at 455-456 per Keely J. For present purposes, the two matters can be considered to, in substance, be constituted by allegations of contravention which are substantially similar in almost all respects.
Late in the afternoon of the second and final day of the liability hearing, the third respondent, Ms Arnold, pressed an application made orally (but, to be fair, foreshadowed at the outset of the first day of the liability hearing, but not then pressed) for an order that the applicants amend their Statements of Claim to particularise the material facts relied upon for the purposes of a plea that the third respondent, Ms Arnold, had been involved in the first respondent’s alleged contraventions of the FW Act, and ought therefore to be taken to have contravened the relevant civil remedy provisions (assuming liability is found) for the purposes of s.550(1) of the FW Act. Section 550(2) of the FW Act defines when a person is involved in a contravention as follows:
(2) A person is involved in a contravention of a civil remedy provision if, and only if, the person:
(a) has aided, abetted, counselled or procured the contravention; or
(b) has induced the contravention, whether by threats or promises or otherwise; or
(c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d) has conspired with others to effect the contravention.
For present purposes, it suffices to observe that the applicants oppose the order sought by the third respondent.
Relevant provisions of the Statement of Claim
The relevant provisions of each of the applicant’s Statements of Claim (the paragraphs set out below are taken from the Foxton Statement of Claim) relating to both the second the third respondents were, as at the commencement of the liability hearing, as follows:
E. INVOLVEMENT BY THE SECOND RESPONDENT.
38. The Second Respondent was involved in the First Respondent’s breaches set out in paragraphs 5 to 37 above, as he was involved in or party to the contraventions and is thereby, pursuant to subsection 550 of the FW Act, taken to have contravened those provisions.
PARTICULARS
See paragraphs 3(a) to 3(g) above.
F. INVOLVEMENT BY THE THIRD RESPONDENT.
39. The Third Respondent was involved in the First Respondent’s breaches set out in paragraphs 5 to 37 above, as [s]he was involved in or party to the contraventions and is thereby, pursuant to subsection 550 of the FW Act, taken to have contravened those provisions.
PARTICULARS
See paragraphs 4(a) to 4(g) above.
The particulars adverted to above at paragraphs 3 and 4 of the Statement of Claim are as follows:
3. The Second Respondent:
(a) is and has been at all relevant times a director of the First Respondent;
(b) is and has been at all relevant times, partially responsible for the carriage and control of the Business and the conduct of the First Respondent;
(c) was responsible at all relevant times for the day to day management of the First Respondent;
(d) was responsible at all material time for maintaining the employment records of the First Respondent;
(e) was responsible at a[ll] relevant times for approving payment of wages to staff;
(f) was responsible at all relevant times for ensuring that the First Respondent complied with its legal obligations under the FW Act and the Award;
(g) was one of several decision maker[s] for the First Respondent in respect of the rates of pay and wage payments to staff in the Business.
4. The Third Respondent:
(a) is and has been at all relevant times a half shareholder of the First Respondent;
(b) is and has been at all relevant times, responsible for the carriage and control of the Business and the conduct of the First Respondent;
(c) was responsible at all material times for maintaining the employment records of the First Respondent;
(d) was responsible at all relevant times for the day to day financial management of the First Respondent;
(e) was responsible at a[ll] relevant times for processing payment of:
(i) wages to staff;
(ii) overtime to staff;
(iii) superannuation to relevant superannuation funds;
(iv) PAYG tax to the Australian Taxation Office;
(f) was one of several decision maker[s] for the First Respondent in respect of the rates of pay and wage payments to staff in the Business.
(g) was aware of the day to day management of the business by the Second Respondent.
The Robinson Statement of Claim is in essentially the same terms as the Foxton Statement of Claim, save for paragraph numbering, and for that reason need not be set out in these Reasons for Judgment.
At the outset of the first day of the liability hearing the third respondent raised the issue as to whether the pleadings were properly particularised in relation to the third respondent and her alleged accessorial liability under s.550 of the FW Act.
Leave was granted to the applicants to amend paragraphs 38 and 39 of the Foxton Statement of Claim and paragraphs 39 and 40 of the Robinson Statement of Claim to substitute “Section 550(2)(a), (b) and (c)” for “subsection 550” of the FW Act as it appeared in those paragraphs (relating to both the second and third respondents) as pleaded at the commencement of the liability hearing.
The Court having ordered that leave be granted to make that amendment, the third respondent indicated that she still considered that there was a deficiency in the pleadings, and sought leave to address the Court on it after the applicants’ opening was completed so that the Court could determine the question at that time. The matter was not however pressed at the completion of the applicants’ opening.
Early on the morning of the second day of hearing the third respondent again raised the issue of the adequacy of the pleadings, and said that she should know each of the contraventions that are put against her in quite clear detail as to the elements of the contravention, and if those amendments were made there may be a truncation of the proceedings by reason of the particularisation of those issues, or because there may be applications to be made by the third respondent, that is, a no case to answer submission, and consideration of whether or not an election to go into evidence needed to be made: as to which, see generally, Fortron Automotive Treatments Pty Ltd v Jones & Ors [2008] FMCA 622; (2008) 222 FLR 1; Rasomen Pty Ltd v Shell Company of Australia Ltd (1997) 75 FCR 216; (1997) 144 ALR 497.
Following an adjournment thereafter to after lunch on the second day further evidence on behalf of the applicants was led, and it was only then that the third respondent finally pressed an oral application for an order for further amendment to the Statement of Claim by way of particularisation of the elements of the contravention.
Third respondent’s submissions
The third respondent submitted that even with the amendment granted on the first day of the hearing the pleadings in their current form did not satisfy the requirement for the involvement of the third respondent to be clearly identified for the purposes of s.550(2) of the FW Act, and took as an example s.550(2)(a) of the FW Act, and suggested that it indicated that a contravention might be committed in one of two ways, firstly, by aiding and abetting, or secondly, by counselling and procuring, and that, secondly, the third respondent was entitled to know how it is that she was said to be “knowingly involved” (although what was obviously meant was “knowingly concerned”: FW Act, s.550(2)(c)).
The third respondent submitted that as soon as her solicitors came onto the record, which was not until the day before the liability hearing, they wrote to the applicants and identified the deficiency in the pleadings with respect to the question of accessorial liability, and that that had resulted in the amendment granted on the first day of the liability hearing. The third respondent submitted that she had been content, “in terms of not holding up the proceedings” to allow the proceedings to continue so that the factual matters upon which the applicants rely, both by way of opening and by way of adducing of their evidence, could be fully put forward.
The third respondent submitted that these are “quasi criminal proceedings”, at least so described in some ways, and in any event civil penalty proceedings, in which particularisation of contraventions was necessary. The third respondent referred to Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union v John Holland Pty Ltd ACN 004 282 268 [2009] FCA 274; (2009) 180 IR 350 (John Holland”) which she submitted dealt with the question of the proper particularisation of similar accessorial liability provisions and where the Federal Court articulated the elements that had to be pleaded in order to make out a case against a person who was going to be proceeded against by way of accessorial liability.
The third respondent:
a)submitted that until there was a full articulation of the case for the applicants, she was not in a position to know what was put against her, and whether additional witnesses might need to be called in order to corroborate or give direct evidence of matters that may assist in her defence;
b)referred to the judgment in Fair Work Ombudsman v Centennial Financial Services Pty Ltd & Ors [2010] FMCA 863; (2010) 245 FLR 242; (2010) 63 AILR 101-278 (“Centennial Financial Services”), and the Federal Magistrates Court’s setting out of the principles derived from John Holland: Centennial Financial Services at [151] per Cameron FM;
c)submitted that she should be entitled to see the pleadings properly regularised, and having done so, be able to consider her position in full, including whether to put on an amended Defence in her own right, as opposed to the combined Defence, there having been a combined Defence earlier filed, and also what evidence, if she chooses to give evidence, she wishes to put before the Court, or whether she wishes to make any other application following full advice and consideration;
d)submitted with respect to John Holland that although that was a case about summary dismissal, courts invariably, where pleadings are deficient, allow applicants to re-plead their case in an appropriate fashion, and in the circumstances of this case the applicants ought to re-plead their case in an appropriate fashion before the respondents put on their evidence;
e)submitted that the position had been complicated by the decision by the Court to split the liability and penalty hearings made on the day prior to the liability hearing commencing, an order to that effect being made in relation to submissions then put for the second respondent seeking to set aside three subpoenas that had issued, the primary purposes of which appeared to be to obtain evidence relevant to the penalty aspect of these proceedings; and
f)pointed out that there were numerous (at least 33) contraventions alleged, and that it was not possible to understand on the present state of the pleadings which of those contraventions were aid and abet counts, which were counselling and procuring counts, or which were counts of being knowingly concerned, and that the efficient management of the proceedings and procedural fairness necessitated an adjournment of the proceedings, and an order for the applicants to amend and properly particularise their Statement of Claim.
Second respondent’s submissions
The second respondent, Mr Arnold, who, despite having lawyers on the record, appeared in person at the hearing, made a very short submission with respect to the alleged lateness of the evidence filed by the applicants, and submitted that it was ultimately 12 weeks late, and included volumes of evidence that he said the Court had further ordered be destroyed, and that the final redacted version of evidence for the applicants was filed a week before the commencement of the liability hearing. Ultimately not much turns on these submissions for the reason set out at [28] below.
Applicants’ submissions
The applicants’ position was that the Statements of Claim do not require amendment.
The applicants submitted that:
a)the proceedings were commenced on 23 October 2012 and that Defences were filed a little over a month later on 30 November 2012, and that the litigation had proceeded for more than 12 months;
b)orders were made on 22 May 2013 were for the applicants to file and serve all affidavit evidence by 19 July 2013 and for the respondents to file evidence in reply by 23 August 2013, and for the applicants to file and serve any evidence in response by 6 September 2013;
c)the case had been set down on 22 May 2013 for hearing for two days on 3 and 4 December 2013, and that there had also been timetables put in place for the filing of evidence, which were subsequently amended by the Court on 12 September 2013, providing for the second and third respondents to file evidence by 17 October 2013 and for the applicants to file any evidence in reply by 31 October 2013;
d)no evidence was filed by the second and third respondents;
e)on 27 November 2013, a week before the hearing began, an application to vacate the hearing dates made by the second respondent was refused;
f)it would be grossly unfair to the applicants, having now made their case, for there to be an adjournment and a forced amendments to the Statement of Claim;
g)the situation was far removed from that in John Holland where no Defence had been filed, and the application was one for summary dismissal pursuant to s.31A of the Federal Court of Australia Act 1976 (Cth) (“FC Act”) in which the Federal Court struck out parts of the Statement of Claim, with leave to re-plead, and that the appropriate course was for the third respondent to make an application for summary dismissal or a no case submission at the appropriate time; and
h)it was unfair, and prejudicial to the applicants to have any issue with respect to the pleadings, or some other form of dismissal of the proceedings, dealt with prior to the second respondent indicating whether he intended to go into evidence, and referred to Australian Securities & Investments Commissionv Rich (2004) 220 CLR 129; (2004) 78 ALJR 1354 (“Rich”) (which had also been adverted to by the third respondent) and said that that was a case concerning whether a party claiming privilege against self-incrimination or the penalty privilege could be the subject of an order for discovery, and that Rich was unsuccessful in obtaining a discovery order against certain company directors because the penalty privilege had been claimed.
The applicants also referred to s.42 of the Federal Circuit Court of Australia Act 1999 (Cth) with respect to endeavouring to ensure that proceedings are not protracted.
The law
In John Holland the Federal Court was considering an application for dismissal of a part of a proceeding against a respondent alleged to be accessorily liable for certain contraventions, the application for dismissal being made pursuant to s.31A of the FC Act, and the Federal Court having to consider whether the pleadings properly pleaded material facts supporting the claim of accessorial liability in respect of contended contraventions by a corporation of provisions of the Workplace Relations Act 1996 (Cth) (“WR Act”). Section 728 of the WR Act is, for practical purposes, identical to s.550 of the FW Act.
In John Holland at [42]-[46] per Greenwood J the Federal Court said as follows:
42 The respondents criticise the pleading on the footing that the pleading simply fails to plead that Mr Sasse knew that each permit holder was entitled to enter the premises and knowingly engaged in conduct which by operation of s 767(3) and (7) constituted a contravention by John Holland of those sections. The pleading refers to correspondence Mr Sasse wrote on 24 November 2008 after the first event in November 2008 and a letter dated 3 December 2008 in which Mr Sasse asserted that the permit holders had no right of entry. The pleading at para 47 pleads Mr Sasse’s state of mind of being concerned to ensure that consistent with his letters of 24 November 2008 and 3 December 2008, permit holders would be refused entry. Similarly, para 48 pleads instructions given by Mr Sasse consistent with an opinion he had formed as recited in para 47 of the pleading. The state of mind pleaded at para 47 is simply Mr Sasse’s contended view, as an employee of John Holland, that permit holders had no right of entry to the premises.
43 Mr Sasse’s opinion on that matter is either right or wrong.
44 However, these paragraphs of the pleading do not assert actual knowledge on the part of Mr Sasse that he knew and understood that each permit holder had a right of entry to the premises and notwithstanding that knowledge, he chose to engage in conduct by writing letters and issuing instructions which had the effect of refusing or unduly delaying entry to the premises or causing others to refuse or unduly delay entry to the premises, by a permit holder “entitled to enter the premises”. Nor does the pleading assert actual knowledge on the part of Mr Sasse of intentional hindering or obstruction of a permit holder exercising rights given to such a person by s 760 of the Workplace Relations Act. Accessorial liability requires a pleading of actual knowledge on the part of the accessory of each and every element of the offence or contravening conduct on the part, in this case, of John Holland Pty Limited and an election to engage in the relevant conduct.
45 The pleading asserts conduct on the part of Mr Sasse in his capacity as an employee of John Holland and in every relevant sense he was acting within the scope of his authority. It is not said that the conduct of Mr Sasse gave rise to a contravention by John Holland. The pleading asserts that Mr Sasse aided, abetted, counselled and procured the contravention of the sections by John Holland. In order to establish that case, the pleading must assert as material facts that Mr Sasse was sufficiently aware of all of the relevant facts going to the contravention by the company, that is, intentional participation. In this case, it must be established that Mr Sasse had knowledge that the permit holders enjoyed a right of entry and notwithstanding that knowledge, he set about engaging in the contravening conduct. To form the requisite intent he must have had “knowledge of the essential matters which go to make up the offence whether or not he knows that those matters amount to a crime” (Yorke v Lucas (1985) 158 CLR 661 at 666 and 667; Giorgianni v The Queen (1985) 156 CLR 473 at 481; Australian Competition and Consumer Commission v Giraffe World Australia Pty Ltd (No 2) (1999) 95 FCR 302 at 346; Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at [154]-[162]; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466; Hamilton v Whitehead (1988) 166 CLR 121).
46 It follows therefore that those paragraphs of the Amended Statement of Claim which assert that Mr Sasse aided, abetted, counselled or procured the contravention by John Holland of s 767(3) and (7) of the Workplace Relations Act in respect of the events that occurred in February 2009 and March 2009 having regard to the conduct asserted on the part of Mr Sasse, have no reasonable prospects of success.
In Centennial Financial Services the Federal Magistrates Court was dealing with civil penalty proceedings under the WR Act and the privilege against self-exposure to penalty, and in that case was dealing with the adequacy of the pleadings insofar as they specified or particularised the relevant allegations, and whether the case as litigated was different from the case as pleaded. In Centennial Financial Services at [151] per Cameron FM the Federal Magistrates Court said as follows:
151 Involvement in a contravention under s 728 can only be made out if it is proved that a person has engaged in conduct specified in s 728(2). Thus, to make out involvement it is necessary to allege that a person has engaged in such conduct. In the present proceedings, the further amended statement of claim made no reference to conduct specified in s 728(2). It is also necessary to particularise which acts or set of acts constituted conduct amounting to involvement but the further amended statement of claim did not do this. Further, to form the requisite intent the respondent must have had knowledge of the essential matters which have gone to make up the contravention in question: Yorke v Lucas (1985) 158 CLR 661. Consequently, an allegation of accessorial liability requires a pleading that the accessory had actual knowledge of each and every element of the principal’s contravening conduct and an election to engage in the relevant conduct; the pleading must assert as material facts that the accessory was sufficiently aware of all the relevant facts going to the contravention: Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v John Holland Pty Ltd (2009) 180 IR 350 at [44], [45]. The further amended statement of claim did not make such allegations.
It is also relevant to set out what the Federal Magistrates Court said in Centennial Financial Services at [150] per Cameron FM by way of summary of the High Court’s judgment in Kirk & Anor v Industrial Court of New South Wales [2010] HCA 1; (2010) 239 CLR 531; (2010) 84 ALJR 154; (2010) 190 IR 437; (2010) 262 ALR 569; (2010) 113 ALD 1 (“Kirk”), which summary the Court respectfully adopts:
150 In Kirk v Industrial Court of New South Wales, which concerned alleged offences against ss 15 and 16 of the Occupational Health and Safety Act 1983 (NSW) (the OH&S Act), it was observed that in the context of criminal proceedings the common law required that a defendant is entitled to be told not only of the legal nature of the offence with which he or she is charged but also the particular act, matter or thing alleged as the foundation of the charge: at [26] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ. In that case, it was held that the statements of the offences as particularised did not identify what measures the Kirk company could have taken, but which it did not take, to obviate an identifiable workplace risk and thus did not identify an act or omission constituting a contravention of ss 15(1) and 16(1) of the OH&S Act. It was held that the New South Wales Industrial Court’s misconstruction of ss 15 and 16 of the OH&S Act, which had the effect of relieving the prosecutor of the obligation of particularising the measures which the Kirk company could have taken but did not take, amounted to jurisdictional error because it led the Industrial Court to misapprehend the limits of its functions and powers such that it made orders convicting and sentencing the appellants where it had no power to do so (at [74]):
It had no power to do that because no particular act or omission, or set of acts or omissions, was identified at any point in the proceedings, up to and including the passing of sentence, as constituting the offences of which Mr Kirk and the Kirk company were convicted and for which they were sentenced. And the failure to identify the particular act or omission, or set of acts or omissions, alleged to constitute the contravening conduct followed from the misconstruction of s 15. By misconstruing s 15 of the OH&S Act, the Industrial Court convicted Mr Kirk and the Kirk company of offences when what was alleged and what was established did not identify offending conduct.
Consideration
The law requires that in civil penalty proceedings that there be proper or adequate particularisation of the material facts comprising the elements of the alleged involvement said to give rise to accessorial liability: Kirk at [26] and [74] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; John Holland at [44]-[45] per Greenwood J; Centennial Financial Services at [151] per Cameron FM. It is an inescapable fact in these proceedings that there is no proper or adequate particularisation of the allegation relating to the third respondent’s alleged accessorial liability under s.550(2)(a), (b) and (c) of the FW Act, in particular as to the acts or omissions comprising the various elements of the third respondent’s alleged involvement in the alleged contraventions.
It is pertinent to observe that whilst the applicants opposed the application for an order that the applicants amend their Statements of Claim to particularise the material facts in relation to accessorial liability, nowhere in the submissions do the applicants point to how it might be said that their Statements of Claim are properly particularised. All of the submissions in opposition to the order sought by the third respondent went to other matters, and in particular the litigation history of the proceedings. The litigation history of the proceedings was essentially otiose for present purposes because on the first day of the liability hearing the applicants sought, and were granted, leave to amend the Statements of Claim to better particularise those paragraphs of the Statements of Claim going to the question of accessorial liability, and in particular, the various sub-paragraphs of s.550(2) of the FW Act relied upon. What the amendment did not do, however, was set out the material facts in relation to each element of the contraventions relied upon in relation to the alleged conduct of the third respondent. There was some indication that the matter would be addressed in opening, but it was not, and the evidence led, perhaps unsurprisingly, did not assist in the particularisation required. It might be said that the third respondent ought to have made the application clearly and unequivocally and pressed it at the outset of the first day of the liability hearing, but her failure to do so, firstly, does not relieve the applicants of the requirement to properly particularise an alleged civil penalty contravention; and, secondly, it did appear to the Court that there might be some prospect of the relevant matters being properly particularised during the course of the applicants’ opening, but that did not materialise. It is not in the interests of justice that a person be exposed to possible liability for a civil penalty contravention where the alleged contravention is not properly particularised by the party seeking the imposition of those penalties. The position might be different if this were non-penalty civil litigation: compare Aon Risk Services Australia Limited v Australian National University [2009] HCA 27; (2009) 239 CLR 175; (2009) 83 ALJR 951; (2009) 258 ALR 14, but it is not.
Resort to suggestions that an amendment to the Statements of Claim will make these proceedings longer does not assist the applicants. The matters were listed for a liability hearing of two days, and the applicants themselves have, broadly speaking, occupied those two days with their evidence. Therefore, no matter what were to now happen, the hearing would be further protracted, and through no fault of the third respondent.
Given that all of the applicants’ evidence is in it ought not be difficult for the applicants to amend their Statements of Claim to point to the conduct, that is to give particulars of the conduct, said to fall within the pleaded sub-paragraphs of s.550(2) of the FW Act. Being forced to amend the Statement of Claim further at this stage may in fact work to the advantage of the applicants, because it is not beyond the realm of possibility that if they do identify any such gaps in re-pleading, they may still be able to re-open their evidentiary case, given that the respondents have not opened their defence.
The Court has not placed any particular weight on the timing of the filing of evidence in this matter, for as set out above, the evidence led (and whether one has regard to the affidavits or the oral evidence) does not assist with the relevant particularisation required.
It is not in the interests of justice that the hearing of this matter continue without the Statements of Claim being amended to include particularisation of the material facts with respect to the elements of the alleged contraventions in relation to the alleged accessorial liability of the third respondent, particularly in circumstances where:
a)the Statements of Claim at the commencement of the hearing required amendment; and
b)the amendments for which leave was granted do not particularise the material facts relied upon in relation to the elements of the alleged contraventions in respect of the third respondent, Ms Arnold’s alleged accessorial liability.
Conclusion and orders
The Court has concluded that:
a)the applicants are to have leave to file an Amended Statement of Claim by 24 December 2018;
b)the proceedings are to be adjourned to a directions hearing at 9.30am (WST) on 24 January 2019, with leave to the parties to appear by video-link from the Sydney Registry of the Court.
There will be orders accordingly.
On the face of it this is a no costs matter: FW Act, s.570(1). If, however, any party considers that they might be entitled to costs: FW Act, s.570(2), that is a matter which the Court proposes to address at the finalisation of the liability, and penalty (if any), hearings. Therefore, there will be an order that costs, if any, be reserved.
It remains only to acknowledge that these Reasons for Judgment have been very significantly delayed. The essential reason for that is the case load in the Western Australian Registry of the Federal Circuit Court which, as recently as November 2017, has been described by the Federal Court as “extreme”: WZASX v Minister for Immigration & Border Protection [2017] FCA 1415 at [32] per McKerracher J, with all of the case management, and other, consequences and effects both obvious and not obvious that flow therefrom. In relation to this case it is pertinent to note that no credit findings are involved, the matter is procedural, and that the Court has had access to the transcript of not only the liability hearing, but the application in a case hearing on the day prior to the liability hearing, and has read those transcripts. In those circumstances, the delay, which the Court very much regrets, has had no effect upon the Court’s rationale in these Reasons for Judgment.
I certify that the preceding thirty-one (31) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev
Date: 22 November 2018
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