Ghimire v Karriview Management Pty Ltd and Sharma v Karriview Management Pty Ltd
[2018] FCCA 2157
•16 August 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GHIMIRE v KARRIVIEW MANAGEMENT PTY LTD and SHARMA v KARRIVIEW MANAGEMENT PTY LTD | [2018] FCCA 2157 |
| Catchwords: PRACTICE AND PROCEDURE – Whether to grant leave for a corporation not to be represented by a lawyer – consideration of factors – complexity – inter-linked cause of action estoppel, Anshun estoppel and issue estoppel – whether accrued or associated jurisdiction – whether applicants had legal capacity to enter into employment contracts – whether work can be performed by a non-citizen – whether employment contract legally valid – whether possible offences by reason of work performed if applicants had no right to work – evidentiary issues which might arise in relation to criminal and civil penalty liability. CONRACTS – Employment contracts – whether statutory prohibition on employment – whether employment contracts with non-citizens valid. |
| Legislation: Federal Circuit Court of Australia Act 1999 (Cth), ss.3, 18, 42 Federal Circuit Court Rules 2001 (Cth), Part 45, Div.45.4, rr.1.03, 9.04, 12.02, 45.10, 45.11, 45.12, 45.13, 45.13A Fair Work Act 2009 (Cth), ss.3, 117, 323, 538, 539, 546, 548, 570 Hospitality Industry (General) Award 2010 Migration Act 1958 (Cth), Part 2, Div.12, Sub-Divs.A, C, ss.4, 83, 235, 245AB, 245AC, 245AG, 245AJ, 245AK |
| Cases cited: Alcantara & Anor v Buildpower Pty Ltd [2010] FMCA 626; (2010) 199 IR 73 |
| Applicant: | AMRIT GHIMIRE |
| Respondent: | KARRIVIEW MANAGEMENT PTY LTD |
| File Number: | PEG 686 of 2017 |
| Applicant: | FULMAYA SHARMA |
| Respondent: | KARRIVIEW MANAGEMENT PTY LTD |
| File Number: | PEG 687 of 2017 |
| Judgment of: | Judge Lucev |
| Hearing date: | 27 April 2018 |
| Date of last submission: | 27 April 2018 |
| Delivered at: | Perth |
| Orders pronounced | 27 April 2018 |
| Delivered on: | 16 August 2018 |
REPRESENTATION
PEG 686 of 2017
| Applicant: | In Person |
| Respondent: | Mr L Quann by telephone with leave |
PEG 687 of 2017
| Applicant: | In Person |
| Respondent: | Mr L Quann by telephone with leave |
ORDERS (as made 27 April 2018 in each of PEG 686 of 2017 and PEG 687 of 2017)
The Respondent’s Application in a Case to be granted leave to appear by a non-lawyer is dismissed and reasons for judgment will be published by Chambers at a later date.
A Registrar of this Court is to attempt to arrange pro-bono legal assistance for the applicant pursuant to r.12.02 of the Federal Circuit Court Rules 2001 (Cth).
In relation to the issue of the applicant being estopped from bringing this application by reason of the orders of the Industrial Magistrates Court of Western Australia in action M90 of 2017 (“Estoppel Issue”):
(a)the respondent file and serve by 27 May 2018:
(i)any further affidavits; and
(ii)an outline of submissions;
(b)the applicant file and serve by 27 June 2018:
(i)any further affidavits; and
(ii)an outline of submissions,
with the affidavits in each case to include copies copy of the final judgment and orders made by the Industrial Magistrates Court of Western Australia in action M90 of 2017.
In relation to the issue of whether the applicants had the legal capacity to enter into a contract of employment with the respondent (“Capacity Issue”):
(a)the applicant file and serve by 27 May 2018:
(i)any further affidavits, such affidavits to include evidence of the visa and visa conditions applying to the applicant for the period of 12 December 2016 to 19 January 2017; and
(ii)an outline of submissions; and
(b)the respondent file and serve by 27 June 2018:
(i)any further affidavits, such affidavit to include evidence as to the respondents nomination of the applicant for the purpose of obtaining a subclass 457 visa; and
(ii)an outline of submissions.
The matter be listed for hearing of the Estoppel Issue and the Capacity Issue at 2.15pm on 24 July 2018.
Costs reserved.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PERTH |
PEG 686 of 2017
| AMRIT GHIMIRE |
Applicant
And
| KARRIVIEW MANAGEMENT PTY LTD |
Respondent
PEG 687 of 2017
| FULMAYA SHARMA |
Applicant
And
| KARRIVIEW MANAGEMENT PTY LTD |
Respondent
REASONS FOR JUDGMENT
Introduction
On 27 April 2018 the Court made the following orders in each of PEG 686 of 2017 and PEG 687 of 2017 (“Proceedings”):
1. The Respondent’s Application in a Case to be granted leave to appear by a non-lawyer is dismissed and reasons for judgment will be published by Chambers at a later date.
2. A Registrar of this Court is to attempt to arrange pro-bono legal assistance for the applicant pursuant to r.12.02 of the Federal Circuit Court Rules 2001 (Cth).
3. In relation to the issue of the applicant being estopped from bringing this application by reason of the orders of the Industrial Magistrates Court of Western Australia in action M90 of 2017 (“Estoppel Issue”):
a. the respondent file and serve by 27 May 2018:
i. any further affidavits; and
ii. an outline of submissions,
b. the applicant file and serve by 27 June 2018:
i. any further affidavits; and
ii. an outline of submissions,
with the affidavits in each case to include copies copy of the final judgment and orders made by the Industrial Magistrates Court of Western Australia in action M90 of 2017.
4. In relation to the issue of whether the applicants had the legal capacity to enter into a contract of employment with the respondent (“Capacity Issue”):
a. the applicant file and serve by 27 May 2018:
i. any further affidavits, such affidavits to include evidence of the visa and visa conditions applying to the applicant for the period of 12 December 2016 to 19 January 2017; and
ii. an outline of submissions,
b. the respondent file and serve by 27 June 2018:
i. any further affidavits, such affidavit to include evidence as to the respondents nomination of the applicant for the purpose of obtaining a subclass 457 visa; and
ii. an outline of submissions.
5. The matter be listed for hearing of the Estoppel Issue and the Capacity Issue at 2.15pm on 24 July 2018.
6. Costs reserved.
The listing for hearing of the Estoppel Issue and the Capacity Issue was subsequently re-listed to 10.15am on 29 January 2019.
These Reasons for Judgment are those referred to in order 1 at [1] above.
Background
The applicants in these Proceedings, Mr Amrit Ghimire (“Mr Ghimire”) and Ms Fulmaya Sharma (“Ms Sharma”) are husband and wife, and each filed an application in this Court to commence the Proceedings on 7 December 2017 (“Applications”). The Proceedings concern the alleged non-payment by the respondent, Karriview Management Pty Ltd (“Karriview”), for work undertaken by Mr Ghimire and Ms Sharma between 12 December 2016 and 19 January 2017. Although work was performed the question of whether or not Mr Ghimire and Ms Sharma were capable of entering into a contract of employment in circumstances where they may not have had work rights in Australia is in dispute in the Proceedings. In any event, in this Court Ms Sharma and Mr Ghimire variously seek an award of money for unpaid wages and superannuation, payment in lieu of notice and annual leave loading on termination, medical expenses, visa application fees and travel costs to return to Nepal.
Upon the second listing before the Court on 2 March 2018 (at the first hearing on 2 February 2018 Mr Ghimire and Ms Sharma had not served the Applications on Karriview), it was revealed Mr Ghimire and Ms Sharma had already obtained orders from the Industrial Magistrates Court of Western Australia (“Industrial Magistrates Court”) for the payment of wages for work undertaken for Karriview. It was alleged that the Industrial Magistrates Court made an order on the basis of Mr Ghimire and Ms Sharma working 18 hours per week, however they claim to have worked 100 hours (or more) per week.
Karriview was represented by Mr Lindsay Quann (“Mr Quann”), a Director of Karriview. At a directions hearing on 2 March 2018 the Court granted leave for Mr Quann to appear on behalf of Karriview for that directions hearing, and made the following orders in the Applications:
1. The applicant file and serve an amended Originating Application and Statement of Claim by 30 March 2018.
2. The matter be adjourned to a further directions hearing on 27 April 2018 at 12.00pm.
3. There be leave to both parties to appear by telephone.
4. The respondent file and serve any Application in a Case to appear other than by lawyer by 13 April 2018.
5. Costs be reserved.
It should be noted that, given the issues raised by the Court with respect to the Capacity Issue, a pro-bono referral was made for Mr Ghimire and Ms Sharma pursuant to r.12.02 of the FCC Rules, the Court having formed the opinion the issues which may be canvassed were complex and it would be in the interests of the administration of justice for Mr Ghimire, Ms Sharma and Karriview to have the assistance of a legal representative.
Karriview filed an Application in a Case and supporting affidavit sworn by Mr Quann on 13 April 2018 (“Mr Quann’s Affidavit”) seeking leave to appear other than by lawyer as required by the Federal Circuit Court Rules 2001 (Cth) (“FCC Rules”). Specifically, in Mr Quann’s Affidavit at [14] it is stated:
14. The Respondent wishes to represent themselves in these proceedings, as opposed to lawyers. The cost of engaging lawyers in these proceedings which the respondent considers as vexatious, an abuse of process and subject to issue estoppel and would be unfairly prejudicial to the Respondent to bear unnecessary costs of defending an application which evidently should be struck out.
Small claims proceedings?
It is necessary to make some observations as to why Karriview is required to seek leave not to be represented by lawyers in these Proceedings which Mr Ghimire and Ms Sharma seek to prosecute as small claims proceedings.
Mr Ghimire and Ms Sharma each filed an amended application (“Amended Applications”) on 29 March 2018 in which they elected for the Proceedings to be dealt with under this Court’s small claim procedures. Pursuant to r.45.13(1) of the FCC Rules, a party to a small claims application requires the leave of the Court to be represented by a lawyer. Furthermore r.45.13A of the FCC Rules provides that despite r.9.04 of the FCC Rules, an officer or employee of a corporation may represent the corporation in a small claims proceeding if the officer or employee is authorised by the corporation to represent the corporation in the proceeding.
The question then arises as to whether this is in fact a small claim application as described in s.548 of the Fair Work Act 2009 (Cth) (“FW Act”) and as contemplated by Div.45.4 of the FCC Rules.
Section 548 of the FW Act relevantly provides as follows:
(1) Proceedings are to be dealt with as small claims proceedings under this section if:
(a) a person applies for an order (other than a pecuniary penalty order) under Division 2 from a magistrates court or the Federal Circuit Court; and
(b) the order relates to an amount referred to in subsection (1A); and
(c) the person indicates, in a manner prescribed by the regulations or by the rules of the court, that he or she wants the small claims procedure to apply to the proceedings.
(1A) The amounts are as follows:
(a) an amount that an employer was required to pay to, or on behalf of, an employee:
(i) under this Act or a fair work instrument; or
(ii) because of a safety net contractual entitlement; or
(iii) because of an entitlement of the employee arising under subsection 542(1);
(b) an amount that an outworker entity was required to pay to, or on behalf of, an outworker under a modern award.
Limits on award
(2) In small claims proceedings, the court may not award more than:
(a) $20,000; or
(b) if a higher amount is prescribed by the regulations--that higher amount.
Procedure
(3) In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:
(a) in an informal manner; and
(b) without regard to legal forms and technicalities.
(4) At any stage of the small claims proceedings, the court may amend the papers commencing the proceedings if sufficient notice is given to any party adversely affected by the amendment.
Legal representation
(5) A party to small claims proceedings may be represented in the proceedings by a lawyer only with the leave of the court.
(6) If the court grants leave for a party to the proceedings to be represented by a lawyer, the court may, if it considers appropriate, do so subject to conditions designed to ensure that no other party is unfairly disadvantaged.
(7) For the purposes of this section, a person is taken not to be represented by a lawyer if the lawyer is an employee or officer of the person.
…
Rules 45.10, 45.11 and 45.12 in Div.45.4 of the FCC Rules provide as follows:
45.10 In this Division:
"small claim " means a claim mentioned in section 548 of the Fair Work Act.
"small claim application " means an application dealt with under this Division.
45.11 (1) An applicant may request that an application for compensation be dealt with under this Division if:
(a) the compensation is not more than $20 000; and
(b) the compensation is for an entitlement mentioned in subsection 548(1A) of the Fair Work Act.
(2) The Court is not bound by any rules of evidence and procedure when dealing with a small claims application and may act:
(a) in an informal manner; and
(b) without regard to legal forms and technicalities.
45.12 A small claim application must:
(a) be in accordance with the approved form; and
(b) be accompanied by a claim in accordance with the approved form.
The above provisions provide that an application which makes a claim for a sum of more than $20,000 is not a small claim: FCC Rules, r.45.11(1)(a), or, at the very least, that the Court cannot award more than $20,000 in small claims proceedings: FW Act, s.548(2)(a).
Mr Ghimire and Ms Sharma also each filed an Amended Statement of Claim on 29 March 2018. In the Amended Statement of Claim filed by Mr Ghimire he makes a monetary claim for $19,634 (comprising 166 hours of unpaid work and three months’ salary in lieu of notice of termination), plus claims for 9.5% superannuation and 17% annual leave loading: Amended Statement of Claim at [12]-[14]. Additionally, Mr Ghimire seeks that Karriview pay “at least $1,000,000 in penalties”: Amended Statement of Claim at [27]. Mr Ghimire also seeks an order for pre-judgment interest and the amount of the Court filing fee for the Application: Mr Ghimire’s Amended Statement of Claim at [29]. Mr Ghimire also makes a claim that “our leaving expenses must be paid by … [Karriview]”: Mr Ghimire’s Amended Statement of Claim at [36]. At the hearing on 27 April 2018 it became apparent that the leaving expenses claim was a claim that Karriview ought to pay Mr Ghimire’s return travel expenses to Nepal for him and his family.
Having regard to the fact that there is a claim for $19,634, plus 17% leave loading, plus superannuation and plus the amount of a return airfare to Nepal, it can, even in the absence of specific figures, safely be concluded by the Court that Mr Ghimire’s claim exceeds a monetary amount of $20,000.
Ms Sharma seeks an order for payment of $24,987.46, that sum being said to be made up of entitlements to visa fees of $7,445, medical expenses of $1,500, return travel expenses to Nepal of $10,000 and the return of a cash bond for accommodation in the amount of $5,000, and a sum of $1,042.46 for rent apparently deducted by the Industrial Magistrates Court from the sum ordered to be paid by Karriview: Ms Sharma’s Amended Statement of Claim at [10]-[16]. Ms Sharma also makes a claim that Karriview “must be charged at least $1,000,000 penalties by the government”: Ms Sharma’s Amended Statement of Claim at [17]. The Court considers that the reference to “penalties” is a reference to penalties to be imposed by the Court, not “government”, particularly given that in Ms Sharma’s Amended Statement of Claim at [18] she refers to this Court imposing penalties on another company for underpayment of wages.
On the papers before the Court, the compensation sought by Mr Ghimire and Ms Sharma exceeds the $20,000 limit for small claim proceedings under s.548(2) of the FW Act and r.45.11(1)(a) of the FCC Rules. In those circumstances the claims made by Mr Ghimire and Ms Sharma are not small claims within the meaning of s.548 of the FW Act and Div.45.4 of Pt.45 of the FCC Rules.
A proceeding is also not a small claims proceeding if an applicant applies for a “pecuniary penalty order”: FW Act, s.548(1)(a). Pecuniary penalty orders are imposed for contraventions of civil remedy provisions: FW Act, s.546(1), in an amount determined by reference to the table in s.539(2) of the FW Act. Section 548 of the FW Act does not purport to be a civil remedy provision, and does not appear in the table of penalty provision sections in s.539(2) of the FW Act. Whilst no particular civil remedy provision is cited by Mr Ghimire and Ms Sharma in their Amended Applications and Amended Statements of Claim, it is plain that they are seeking the imposition of civil penalties upon Karriview. The claim for the imposition of penalties does however mean that the Amended Applications are not small claims applications: FW Act, s.548(1)(a). Further, the Amended Applications are not small claims proceedings because some of the relief which is sought (for example, the payment of airfares for the return of Mr Ghimire, Ms Sharma and their family to Nepal) is plainly not within the matters listed in s.548(1A) of the FW Act: Whitfield v One Key Resources Pty Ltd [2014] FCCA 553; (2014) 285 FLR 416; (2014) 241 IR 472 at [16]-[20] per Judge Lucev; Ritchie v Chubb Security Services Ltd [2010] FMCA 361; (2010) 196 IR 174 at [4] per Smith FM; Yousef v Taxsmart Group Pty Ltd [2013] FCCA 2089 at [1] per Judge O’Dwyer.
It follows that the prohibition on a lawyer appearing in the Proceedings does not apply because the Amended Applications are not small claims applications, and therefore Karriview requires leave to appear other than by a lawyer.
Representation of a corporation by a non-lawyer
Rule 9.04 of the FCC Rules is as follows:
Except as provided by or under an Act or regulations made under an Act, or with the leave of the Court, a corporation may not start or carry on a proceeding otherwise than by a lawyer.
In Wong v Dong Lai Sun Massage Pty Ltd [2016] FCCA 18; (2016) 305 FLR 423 at [19] per Judge Lucev (“Wong”) this Court summarised a non-exhaustive list of factors the Court may consider when determining if the discretion to grant leave under r.9.04 of the FCC Rules should be exercised, as follows:
a) the relative complexity or simplicity of a matter;
b) whether a non-lawyer appears, or has previously appeared, for any of the parties;
c) the objects and purposes of the FCCA Act and FCC Rules, including the impact of those objects and purposes on case management considerations;
d) whether a party can be effectively represented without a lawyer appearing, and whether prejudice will be suffered by any party by reason of the appearance or non-appearance of a lawyer for a party;
e) whether there has been appropriate opportunity to arrange legal representation;
f) the financial position of a party; and
g) whether the granting of leave to appear is opposed.
In the exercise of this discretion it is not necessary for each factor to be given equal weight, nor that other individual circumstances peculiar to the Proceedings should not be heeded: Wong at [20] per Judge Lucev. Of particular relevance in the Proceedings is the purpose underlying r.9.04 of the FCC Rules, namely that the Court be assisted by those qualified and experienced in arguing legal disputes and who have ethical duties to clients: Groundwater v Territory Insurance Office [2004] FMCA 381; (2004) 183 FLR 437 at [40] per Brown FM; Alcantara & Anor v Buildpower Pty Ltd [2010] FMCA 626; (2010) 199 IR 73 at [10] per Lucev FM.
Consideration
Complexity/simplicity
The issues
Having read the papers in the matter the Court identified two major issues referred to in the Court’s Orders of 27 April 2018:
a)one previously raised by Karriview regarding the orders and judgment of the Industrial Magistrates Court estopping Mr Sharma and Ms Ghimire from bringing the Proceedings in this Court (“Estoppel Issue”); and
b)whether Mr Ghimire and Ms Sharma, because of their visa status and conditions, had the capacity to enter into a contract of employment with Karriview (“Capacity Issue”).
Estoppel issue
The Estoppel Issue arises by reason of the Response filed by Karriview on 24 April 2018 in relation to each of the Amended Applications, and which opposed the making of any orders in these Proceedings on the following bases:
1. Cause of action estoppel prevents the Applicant from bringing the claim again (Industrial Magistrates Court action M 90 of 2017).
2. The Applicant is estopped and precluded from maintaining his claim in this action against the defendant.
3. To the extent that any orders sought apply to refugee and visa status, the Respondent never sponsored the Applicant and owes no duty to the Applicant in that regard.
The above Response is that in relation to Mr Ghimire’s Application, but an identical Response, save for the Industrial Magistrates Court action number, was filed in relation to Ms Sharma’s Application (which is Industrial Magistrates Court action M92 of 2017).
Mr Quann’s Affidavit at [13] says (in what is effectively a submission) that:
13. The current proceedings are an abuse of process. The matters have already been put before the Industrial [Magistrates] Court and decided upon.
Mr Quann’s Affidavit attached various documents relating to the proceedings before the Industrial Magistrates Court, and although it would appear that the documents annexed to Mr Quann’s Affidavit are not complete in that regard, they do give a sufficiently complete picture of the proceedings before the Industrial Magistrates Court for present purposes.
Mr Quann’s Affidavit attaches Mr Ghimire’s application to the Industrial Magistrates Court, but not the application of Ms Sharma. The terms of the statement of orders sought in the Industrial Magistrates Court for Mr Ghimire were as follows:
Our visa is rejected from Karriview Management and we never gets any cents. We need to leave a country but we surrender as refugee. Our visa has no work rights but until to finalise this case we are able to stay.
There is then an affidavit of Ms Sharma attached in relation to her claim in the Industrial Magistrates Court (which was numbered M92/2017), and from which it is plain that Ms Sharma has made claims:
a)for her visa expenses following the withdrawal of the visa nomination “from Karriview”: at [1] and [9];
b)all travel expenses from Australia to Nepal: at [2] and [10];
c)payment for her six weeks work as a casual housekeeper: at [3] and [7]-[8];
d)repayment of the bond (of $5,000) for accommodation: at [11];
e)superannuation contributions: at [13]-[15] and [24];
f)payment of pre-judgment interest: at [25]; and
g)payment of the Court filing fee: at [25],
and it is apparent from the terms of Ms Sharma’s Affidavit in the Industrial Magistrates Court proceedings that the factual context alleged is, if not the same, then substantially similar, to that alleged in these Proceedings.
The orders in the Industrial Magistrates Court in relation to Mr Ghimire’s claim are annexed to Mr Quann’s Affidavit and are as follows:
1.Judgment for the claimant: the respondent shall pay to the claimant $6,297.17.
2.The respondent shall pay the claimant pre-judgment interest of 5.5% fixed in the sum of $286.57.
3.The respondent shall make any consequential outstanding payments of superannuation as required by clause 28 of the Hospitality Industry (General) Award 2010.
The Industrial Magistrates Court orders for Mr Ghimire are dated 16 November 2017 and appear to have been issued and sealed by the Industrial Magistrates Court on 17 November 2017. There are no separate issued or sealed Industrial Magistrates Court orders for Ms Sharma before the Court.
No formal or sealed copy of the Reasons for Judgment given in the Industrial Magistrates Court appear in any of the papers filed in the Proceedings. There is, however, in each of Mr Ghimire’s and Ms Sharma’s Amended Statement of Claim a document annexed which purports to be a summary of the result of the oral Reasons for Judgment given in the Industrial Magistrates Court on 16 November 2017, and is in the following form:
M90/2017 and M92 of 2017: Summary of Result of Oral Reasons for Judgment (16/11/17)
1. Were the claims by each of AG and FS against the Company "settled" as a result of an exchange of text messages in May 2017?
For reasons to be explained, there was no agreement to settle the claim of AG or the claim of FS.
2. What is the source of the rights and obligations of AG, FS and the Company arising from the employee/employer relationship?
For reasons to be explained, AG and FS and the Company are subject to the Hospitality Industry (General) Award 2010 ("the Award"): (a) AG and FS are each casual employees; (b) AG is a Cook Grade 3; (c) FS is a Guest Service Grade 2.
3. For the purpose of determining the entitlements of AG and FS under the Award, what hours were worked by each of AG and FS?
For reasons to be explained,
(a) On the days that AG worked in the following periods: 13/12/16-23/12/16 and 12/1/17-18/1/17 from 0700-1200 and 1700-2030; 26/12/16-8/1/17 from 0700-1200 and 1700-2200; 12/12/16: 5 hours; 19/1/17: 3 hours. The result is $7339.63 per the Award.
(b) On the days that FS worked in the following periods: 13/12/16-23/12/16 and 12/1/17-18/1/17 from 0830-1230; 26/12/16-8/1/17 0830-1230 and 1330-1730; 12/12/16: 4 hours; 19/1/17: 2 hours. The result is $3867.28 per the Award.
4. Did the Company make any cash payments to AG or to FS?
For reasons to be explained, I am not satisfied that the Company made any cash payments to AG or FS.
5. Is the Company entitled to make any deductions from the entitlements of AG and FS?
For reasons to be explained: (a) the effect of the Award is that the Company is entitled to deduct $187.11 per week ($1042.46 total) for accommodation from the entitlement of each of AG and of FS; (b) the effect of the FW Act is that the Company is not entitled to deduct any other amounts (eg. rent after employment, damages, cleaning costs); (c) this Court has no jurisdiction to determine claims arising from (b).
6. Does this Court have the jurisdiction to hear and determine any claims arising from the other facts raised by AG and FS concerning: (a) visa fees ($7500); (b) return of bond alleged to have been paid to the Company ($5000); (c) costs of relocating to Nepal ($10000).
For reasons to be explained, this Court has no jurisdiction to determine each of those claims.
Orders to be made on the claim by AG:
1. The Company pay AG the sum of $6091.09
(ie $7133.55 - $1042.46)
2. The Company pay pre-judgment interest.
3. The company make any consequential outstanding payments of superannuation as required by Clause 28 of the Award.
Orders to be made on the claim by FS:
1. The Company pay FS the sum of $2824.82
(ie $3867.28 - $1042.46)
2. The Company pay pre-judgment interest.
3. The Company make any consequential outstanding payments of superannuation as required by Clause 28 of the Award.
(It is apparent that the references to AG and FS in the summary of the oral Reasons for Judgment in the Industrial Magistrates Court are references to Mr Ghimire and Ms Sharma respectively).
The concept of cause of action estoppel (or res judicata) was adverted to by the High Court in D’Orta-Ekenaike v Victoria Legal Aid & Anor [2005] HCA 12; (2005) 223 CLR 1; (2005) 79 ALJR 755 (“D’Orta-Ekenaike”) at [34] per Gleeson CJ, Gummow, Hayne and Heydon JJ, where the majority judgment in the High Court observed as follows (footnotes omitted):
A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances. That tenet finds reflection in the restriction upon the reopening of final orders after entry and in the rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud. The tenet also finds reflection in the doctrines of res judicata and issue estoppel. Those doctrines prevent a party to a proceeding raising, in a new proceeding against a party to the original proceeding, a cause of action or issue that was finally decided in the original proceeding. It is a tenet that underpins the extension of principles of preclusion to some circumstances where the issues raised in the later proceeding could have been raised in an earlier proceeding.
In this case the question of whether or not matters were finally decided by the Industrial Magistrates Court will have to have regard to the Industrial Magistrates Court determining:
a)the hours of work and wages to be paid for both Mr Ghimire and Ms Sharma, and making orders in respect thereto;
b)payment of superannuation on the amount of wages ordered to be paid, and making orders with respect thereto;
c)that wages and superannuation were payable under the terms of the Hospitality Industry (General) Award 2010 (“Award”), the Award being held by the Industrial Magistrates Court to be applicable to the work performed by Mr Ghimire and Ms Sharma; and
d)that it had no jurisdiction to deal with the issues of visa fees, return of the accommodation bond, and the costs of relocating to Nepal, and at least in this respect regard might be had to arguments concerning:
i)whether cause of action estoppel can arise in this Court in respect of an issue which the Industrial Magistrates Court has found that it has no jurisdiction to determine (as to which see also [37] below); and
ii)in relation to those issues in respect of which the Industrial Magistrates Court found it had no jurisdiction, whether this Court has either associated jurisdiction under s.18 of the Federal Circuit Court of Australia Act 1999 (Cth) (“FCCA Act”), or whether it might have accrued jurisdiction in relation to non-federal parts of a federal matter: as to which see Rana v Google Inc [2017] FCAFC 156; (2017) 254 FCR 1 (“Rana”) at [15]-[21] per Allsop CJ, Besanko and White JJ. It is presently unnecessary to determine (and probably not necessarily determinable on the papers before the Court in their present state) whether the claims that the Industrial Magistrates Court found were not within its jurisdiction are federal claims or non-federal claims which are part of the matter to be determined.
There are further issues which arise from the foregoing, namely:
a)whether any federal claim now made is arguably colourable and not made in good faith in circumstances where the claims which arguably found this Court’s federal jurisdiction (namely the claims under the Award in relation to hours and wages and superannuation) have seemingly been determined by the Industrial Magistrates Court, and are therefore claims in respect of which judgment in the Industrial Magistrates Court has arguably extinguished those claims by way of cause of action estoppel: D’Orta-Ekenaike at [34] per Gleeson CJ, Gummow, Hayne and Heydon JJ. As to the circumstances in which a claim may be held to be colourable or non-colourable, and whether the claim was made for an improper purpose, see Rana at [21]-[22] per Allsop CJ, Besanko and White JJ and Burgundy Royale Investments Pty Ltd v Westpac Banking Corporation (1987) 18 FCR 212; (1987) 76 ALR 173; [1988] ATPR 40-835; FCR at 219 per Bowen CJ, Morling and Beaumont JJ; and
b)because it now appears that Mr Ghimire has made claims in respect of payment in lieu of notice of termination (for which three months payment is sought) and 17% annual leave loading, and although Mr Ghimire has not put the claims precisely in these terms, it is plain that the payment in lieu of notice sought is a common law claim for damages for payment in lieu of reasonable notice on termination, but is also one which might be framed in the alternative as a federal claim for payment in lieu of notice under s.117 of the FW Act, or possibly under a provision of the Award (the Award is not presently before the Court), but bearing in mind that it would not be unusual to find such a provision in a Modern Award made under the FW Act, and likewise, that it would not be unusual to find a provision for payment for annual leave loading on termination for annual leave payable on termination in a Modern Award, and to the extent that these are federal claims arising under the FW Act or the Award it is not apparent that they were in issue before the Industrial Magistrates Court, although it might be argued that they were claims which, given the nature of the claims made before the Industrial Magistrates Court, ought to have been made at that time, and therefore give rise to an Anshun estoppel, and which therefore preclude the Court from determining those claims: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; (1981) 55 ALJR 621; (1981) 36 ALR 3.
The complications which arise in this matter with respect to cause of action estoppel and Anshun estoppel arising from the Industrial Magistrates Court judgment of 16 November 2017, and the further complications which might thereby arise with respect to this Court’s accrued or associated jurisdiction, are such that it is the Court’s view that those issues, both of which can be notoriously complex, and which are complex here, are such that the Estoppel Issue weighs significantly in favour of a refusal of the application for Karriview to be represented by a non-lawyer in these Proceedings.
Finally, it might be observed that the Industrial Magistrates Court would have had no jurisdiction to deal with the federal wage and superannuation claims if Mr Ghimire and Ms Sharma were not employees because applications for orders under civil remedy (or pecuniary penalty) provisions of the FW Act require that Mr Ghimire and Ms Sharma be an “employee”: FW Act, s.539(2) (and see also s.538 of the FW Act). The Estoppel Issue might, therefore, not arise at all if the Court concludes that there was a statutory prohibition on the employment of Mr Ghimire and Ms Sharma and that their employment contracts with Karriview were not legally valid, and that Mr Ghimire and Ms Sharma were therefore not employees of Karriview at all during the periods of purported employment, because the judgment upon which any estoppel is founded must be made by a court competent, that is with jurisdiction, to finally determine the matters in issue: Ex parte Amalgamated Engineering Union (Australian Section); Re Jackson (1937) 38 SR (NSW) 13 at 19 per Jordan CJ (1937) 55 WN (NSW) 7 (referred to in Taylor v Ansett Transport Industries Ltd & Anor (1987) 18 FCR 342; (1987) 72 ALR 188; (1987) 12 ALD 516; FCR at 352-353 per Fisher J); Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363; (2004) 78 ALJR 1031; (2004) 208 ALR 1 at [21] per Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ. Likewise, if Mr Ghimire and Ms Sharma were not employees of Karriview then this Court would arguably not have jurisdiction to determine any of their federal (or other) claims.
Capacity issue
Section 235 of the Migration Act relevantly provides as follows:
235. Offences in relation to work
(1) If:
(a) the temporary visa held by a non-citizen is subject to a prescribed condition restricting the work that the non-citizen may do in Australia; and
(b) the non-citizen contravenes that condition;
the non-citizen commits an offence against this section.
(2) For the purposes of subsection (1), a condition restricts the work that a non-citizen may do if, but not only if, it prohibits the non-citizen doing:
(a) any work; or
(b) work other than specified work; or
(c) specified work.
(3) An unlawful non-citizen who performs work in Australia whether for reward or otherwise commits an offence against this subsection.
…
(4B) An offence against subsection (1), (3) or (4) is an offence of strict liability.
…
On its face s.235 of the Migration Act prohibits a non-citizen from working (subject to being granted work rights under a visa) and makes it an offence for a non-citizen without work rights to engage in “work” other than in accordance with visa conditions. There is a definition of “work” in s.245AG of the Migration Act (which is set out below: see [42] below), however, that definition applies only to the use of that word in Sub-Div.C of Div.12, Pt.2 of the Migration Act. Section 235 of the Migration Act is found in Pt.2, Div.12, Sub-Div A of the Migration Act. The definition of “work” in Pt.2, Div.12, Sub-Div.C of the Migration Act relates to offences and civil penalties for those who allow non-citizens to “work”.
The issue of the legality of non-citizens engaging in work has been the subject of a number of decided Australian cases, including the following:
a)in Nonferral (NSW) Pty Ltd v Taufia (1998) 43 NSWLR 312; (1998) 143 FLR 443; (1998) 153 ALR 439; (1998) 16 NSWCCR 130 (“Taufia”) the New South Wales Court of Appeal considered the predecessor of s.235 of the Migration Act, then s.83(5) of the Migration Act which was as follows:
Where a person who is an illegal entrant performs any work in Australia without the permission, in writing, of the Secretary [of the Department of Immigration], the person commits an offence against this sub-section.
and held that s.83 of the Migration Act did not render an employment contract illegal or unenforceable for the purposes of State workers compensation legislation: Taufia, NSWLR at 316 per Cole JA and 323 per Stein JA, and further suggested that even if the employment contract was illegal, the State legislation may provide a discretion to treat the non-citizen as a worker or employee, though this must be balanced against the policy and legislative intent of the Migration Act and the workplace legislation in question: Taufia, NSWLR at 314 per Cole JA, at 324-325 per Stein JA, and 335 per Sheppard A-JA;
b)in Australian Meat Holdings Pty Ltd v Kazi [2004] QCA 147; [2004] 2 Qd R 458 (“Kazi”) it was found by the Queensland Court of Appeal that the respondent in the matter was not a “worker” within the meaning of State workers compensation legislation as s.235(3) of the Migration Act prohibits an unlawful non-citizen from entering into an employment contract. In Kazi, in distinguishing Taufia, the Queensland Court of Appeal drew attention to the differences between s.235 of the Migration Act and its predecessor, and emphasised the clear legislative intention, including the objects in s.4 of the Migration Act, and the scope of the Migration Act, to find s.235 of the Migration Act operated as an absolute prohibition on the performance of work by an unlawful non-citizen: Kazi at [23] and [32] per Davies JA; see also Singh v TAJ (Sydney) Pty Ltd [2006] NSWCA 330; (2006) 4 DDCR 557 at [47] per Beazley JA and [60] per Tobias JA. In respect of the possible consequences and harshness of such a construction it was said in Kazi at [48] per Williams JA:
Issues such as unjust or inconvenient consequences are relevant where the court is considering whether the sanction of illegality is disproportionate to the seriousness of the unlawful conduct, and that cannot arise where the contract in question is directly or impliedly prohibited by the statute upon the proper construction of its terms. Here the contract has as its whole object the doing of the very act which the statute prohibits the respondent from doing, namely working, and in consequence on the proper construction of the statute such a contract is illegal. The fact that there may be some results which are perceived to be unjust, unreasonable or inconvenient is beside the point. The court must give effect to the statute.
c)in Hussein v Secretary of the Department of Immigration & Multicultural Affairs & Ors (No 2) [2006] FCA 1263; (2006) 155 FCR 304; (2006) 157 IR 405 (“Hussein (No 2)”) the Federal Court considered a claim from an applicant in detention at an immigration detention centre contending he had entered into an “agreement” to provide work at the detention centre and therefore he ought to be paid for it. In Hussein (No 2) at [67] per Graham J the Federal Court observed as follows with respect to the validity of the “contract”:
Given that an offence under s 235(3) is a strict liability offence by virtue of s 235(4B) of the Act I cannot see how the applicant could avoid a finding that the contract or arrangement which he had with the third and/or fourth respondent was void for illegality and unenforceable.
The Court further notes that:
a)judgments in the United Kingdom suggest that the illegality of a contract “ab initio” bars any claim for employment rights, including back pay: Vakante v Addey & Stanhope School Governing Body [2004] ICR 279; Allen v Hounga [2012] IRLR 685;
b)in Ireland it has been determined that the protection of immigration law was a central concern and to grant rights to irregular immigrants would be to circumvent the legitimate aim of the legislature: Hussein v Lab. Ct. & Another [2012] IEHC 364; and
c)in the United States in Hoffman Plastic Compounds, Inc. v National Labor Relations Board 535 U.S. 137 (2002) the majority of the United States Supreme Court (in a 5-4 split decision) found that federal immigration policy foreclosed any awarding of back pay to an undocumented alien who was never legally authorised to work in the United States.
The Migration Act also provides for offences and civil penalties in relation to work by an unlawful non-citizen with no work rights and work by a lawful non-citizen in breach of visa conditions under Sub-Div.C, Div.12 of Pt.2 of the Migration Act. Section 245AG defines “work” for the purposes of that sub-division as follows:
245AG Meaning of work and allows to work
(1) In this Subdivision:
"work" means any work, whether for reward or otherwise.
(2) In this Subdivision, a person allows a person to work if, and only if:
(a) the first person employs the second person under a contract of service; or
(b) the first person engages the second person, other than in a domestic context, under a contract for services; or
…
It is unnecessary to set out in detail the relevant offences and civil penalties provisions in Sub-Div.C, Div.12 of Pt.2 of the Migration Act, but in summary they provide that a person is liable for a civil penalty or a criminal offence if they allow, or continue to allow:
a)an unlawful non-citizen to work: Migration Act, s.245AB; and
b)a lawful non-citizen to work in breach of a work-related visa condition: Migration Act, s.245AC.
Under ss.245AB(3) and 245AC(3) of the Migration Act the offences thereby created are punishable by imprisonment of up to two years. There are specific provisions outlining the criminal liability and the civil penalty liability of executive officers of bodies corporate (in this case Mr Quann might arguably be an executive officer of Karriview): Migration Act, ss.245AJ and 245AK.
The intersection of statutory provisions which:
a)prohibit an unlawful non-citizen from working;
b)prohibit persons from allowing unlawful non-citizens to work, and lawful non-citizens to work in breach of visa conditions; and
c)impose civil and criminal liability,
establish a litigation framework which is complex in relation to the Proceedings.
That complexity arises because of:
a)the nature of the question as to whether Mr Ghimire and Ms Sharma were able to be employed, and the issues of statutory construction attached thereto, and the evidentiary issues which might arise in relation to the nature of the visas concerned and any conditions attaching to those visas; and
b)because of the possible civil, but in particular criminal, liability of Karriview and Mr Quann, under ss.245AB and 245AC of the Migration Act, which might require serious consideration during the course of the Proceedings as to the admissibility of evidence, and the taking of objection on the basis of the privilege against incrimination, having regard to the possibility of further civil and criminal proceedings in relation to possible breaches of ss.245AB and 245AC of the Migration Act,
which issues are not merely complex, but also of significance in the context, particularly, of the possible criminal liability and the imposition of a term of imprisonment arising from subsequent Migration Act proceedings.
The above matters also need to be considered in a context where the Court is arguably obliged to refer any apparent serious breach of the law to the relevant regulatory or prosecutorial authority: Simpson v Hodges [2007] NSWSC 1230 at [268]-[269] per Hall J, applied in Australian Building and Construction Commissioner v Parker (No 2) [2017] FCA 1082; (2017) 270 IR 165 at [89] and [97] per Flick J; Petera Pty Ltd v EAJ Pty Ltd & Ors (1985) 7 FCR 375 at 380 per Wilcox J (citing In the Marriage of P [1985] FLC 79,911 at 79,921 per Lindenmayer J), although there is a discretion not to make such a referral dependent upon the circumstances of a particular case: Collins v Ricardo [2016] FamCA 211 at [66]-[69] and [72] per Loughnan J.
It is apparent that the Capacity Issue is likely to give rise to complex issues in these Proceedings, including complex inter-related issues with potentially significant consequences for Karriview and Mr Quann in relation to other possible proceedings under the Migration Act involving possible criminal and civil liability. In those circumstances the complexity of the Capacity Issue is, of itself, sufficient to justify the refusal of the application for Karriview to be represented by a non-lawyer in these Proceedings.
Prior representation by a lawyer
Karriview was represented by a lawyer before the Industrial Magistrates Court. It is evident that the Response in these Proceedings was drafted by a lawyer, or that a lawyer had a hand in drafting or advising upon its drafting. In the circumstances, Karriview has obviously had the opportunity to be represented by a lawyer in the Proceedings.
Mr Quann expressed the view that he did not wish to be represented by a lawyer in the Proceedings because the Proceedings were an abuse of process because the matter had been resolved by the orders and judgment of the Industrial Magistrates Court, and because of the costs involved in engaging a lawyer to defend the Proceedings. No evidence was led as to Karriview’s anticipated costs for the Proceedings. Those costs might of course depend upon how the Proceedings progress, and precisely what is argued, and in particular, the outcome of the determination of the Estoppel Issue and the Capacity Issue. That said, it will be evident from what the Court has said with respect to both the Estoppel Issue and the Capacity Issue that the costs of determining those issues alone will not be insignificant. The fact that costs will not be insignificant does however make the point that complex proceedings are proceedings in which, usually, costs will not be insignificant, and in the circumstances the fact of not insignificant costs being incurred is a consequence of the complexity of the Proceedings.
The Court notes that in the simpler proceedings before the Industrial Magistrates Court Karriview was represented by a lawyer, and notwithstanding any expense associated with the engagement of a lawyer in these Proceedings, it must be said that if it was seen to be necessary to engage a lawyer for what were, by comparison, far more simple proceedings before the Industrial Magistrates Court, then it would be appropriate for Karriview to be represented by a lawyer in these Proceedings. As such, a consideration of Karriview’s prior representation by a lawyer in the Industrial Magistrates Court weighs, although not significantly, in favour of Karriview being represented by a lawyer in these Proceedings.
Effective representation
At the directions hearings on 2 March 2018 and 27 April 2018 it became evident to the Court there was some hostility between Mr Ghimire and Mr Quann, and there is further evidence of hostility between Mr Ghimire and persons other than Mr Quann acting on behalf of Karriview in the materials before the Court, including the involvement of, or threatened involvement of, the police to remove Mr Ghimire and Ms Sharma from Karriview’s premises.
If Mr Quann were to appear on behalf of Karriview at the hearing of the Estoppel Issue and the Capacity Issue there is a strong likelihood that he will be both advocate and witness. Likewise, if the matter were to proceed to a final hearing, Mr Quann would again be likely to be both an advocate and witness. Generally, the conflict which arises between a person’s role as a witness and an advocate may have a tendency to colour the independence and objectivity usually required of an advocate which is necessary for truly effective representation of a party: Wong at [54] per Judge Lucev; Fair Work Ombudsman v Siner Enterprises Pty Ltd [2017] FCCA 2583 at [34]-[39] per Judge Lucev (and the cases cited in both instances). In this case where there are likely to be difficult and potentially serious forensic choices to be made in relation to evidentiary issues which might affect the possible civil and criminal liability of Karriview, and Mr Quann himself, having a professionally trained advocate who can exercise their independence and be objective, whilst fulfilling their duty to the Court as an officer of the Court and their duty to their client, is likely to be of real importance for the proper conduct of the hearings, and in that respect to be of assistance to the Court. Those circumstances weigh significantly in favour of a refusal of the application for Karriview to be represented by a non-lawyer in these Proceedings. Otherwise, the hostility between Mr Ghimire and Mr Quann at the directions hearings, if repeated at future hearings would be likely to cause delay and inconvenience because the Court would have to undertake a role as “referee” to ensure the parties conducted the Proceedings in a proper manner, whereas if a lawyer were to appear for Karriview the likelihood of the Court having to do so would be lessened by the lawyer’s necessary understanding of the lawyer’s duties as an officer of the Court and to the client. The Court considers these circumstances weigh in favour of a refusal of the application for Karriview to be represented by a non-lawyer in these Proceedings, albeit not to the same degree as do the circumstances in relation to the forensic choices to be made arising, in particular, from the Capacity Issue.
Financial position
No evidence was tendered regarding the financial positon of Karriview. The Court has noted above that the costs to Karriview of these Proceedings would not be inconsiderable, but that those costs would be in part a reflection of the complexity of the Proceedings. As such, the Court takes the view that those costs are essentially unavoidable if the Proceedings are to be properly conducted on Karriview’s behalf. It follows, therefore, that both on the basis of a lack of evidence, and in any event generally, the Court does not consider that Karriview’s financial position weighs in favour of allowing Karriview to be represented by a non-lawyer in these Proceedings.
Objects of legislation
The role and mode of operation of this Court as set out in the FCCA Act and the FCC Rules, and as prescribed by the objects in ss.3 and 42 of the FCCA Act, and the objects in r.1.03 of the FCC Rules, provide for the Court to operate in a manner:
a)as informal as possible in the exercise of judicial power;
b)which is not protracted in its proceedings;
c)which resolves proceedings justly, efficiently and economically;
d)which uses streamlined procedures; and
e)that avoids undue delay, expense and technicality.
Sandeep v Minister for Immigration & Anor [2016] FCCA 3339 at [23] per Judge Lucev (and cases there cited).
A number of the above objects give rise to conflicting considerations in this matter. There can be no doubt that the Proceedings will not be as informal if a lawyer appears for Karriview, and that there will be increased expense and technicality if a lawyer appears, although expense and technicality are a consequence also of the issues which arise in the Proceedings, and which have been flagged by the Court. Given the nature of the issues which do arise the Court is of the view that if a lawyer appears for Karriview the Proceedings will be less protracted, more streamlined and result in less delay than if a non-lawyer appears for Karriview. Put simply, given the nature of the issues which presently arise in these Proceedings, they will be conducted more efficiently and economically (at least as to time) if a lawyer appears for Karriview. Ultimately, the Court must also have regard to the just resolution of the Proceedings, and in the latter respect, because of the nature of the issues which might arise and which may require forensic decisions to be made in relation to evidence (by reason of the possible criminal and civil liability of Karriview and Mr Quann in relation to other proceedings under the Migration Act as set out above: see [42]-[48] above), it would be unjust for Karriview to be represented other than by a lawyer in these Proceedings.
Having regard to the objects of the FCCA Act and the FCC Rules, those objects favour the refusal of Karriview’s application to be represented by a non-lawyer in these Proceedings.
Section 3 of the FW Act sets out the objects of the FW Act, and relevantly in relation to these Proceedings refers to “…. providing accessible and effective procedures to resolve grievances and disputes and providing effective compliance mechanisms”: FW Act, s.3(e). In this matter, primarily for reasons set out at [56] above, and in particular bearing in mind the need to resolve the Proceedings justly, to the extent that the reference to effective procedures and effective compliance mechanisms referred to in s.3(e) of the FW Act have application, the effectiveness of those procedures for dispute resolution and the effectiveness of compliance mechanisms would arguably be undermined by the appearance of a non-lawyer for Karriview in what the Court has found to be complex proceedings for reasons otherwise set out above: see [24]-[48] above. In those circumstances, the objects of the FW Act, to the extent that they are relevant, favour the refusal of Karriview’s application to appear by a non-lawyer in these Proceedings.
Conclusion – leave to appear other than by a lawyer
From a consideration of all of the foregoing factors it is evident that, both individually and collectively, the factors weigh significantly in favour of a refusal of the application for Karriview to be represented by a non-lawyer in these Proceedings, and for the reasons set out above the Court made orders on 27 April 2018 dismissing Karriview’s Application in a Case to appear in these Proceedings other than by a lawyer.
I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev
Date: 16 August 2018
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