Giuliano v Family Hopes Pty Ltd
[2024] FedCFamC2G 206
•1 March 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Giuliano v Family Hopes Pty Ltd [2024] FedCFamC2G 206
File number(s): SYG 397 of 2022 Judgment of: JUDGE STREET Date of judgment: 1 March 2024 Catchwords: FAIR WORK- small claim matter against employer- no involved person jurisdiction- need for evidence of service- judgment sum not supported- purported examination process – UCPR examination not picked up- arrest warrant request – not appropriate for enforcement of debts -Article 11 of the International Covenant on Civil and Political Rights- arrest warrant refused – judgment sum set aside – proceedings dismissed Legislation: Acts Interpretation Act 1901 (Cth)
Fair Work Act 2009 (Cth)
Federal Circuit and Family Court of Australia Act 2021 (Cth)
Federal Court of Australia Act 1976 (Cth)
Human Rights Commission Act 1981 (Cth)
Judiciary Act 1903 (Cth)
Civil Procedure Act 2005 (NSW)
Federal Court and Family Court of Australia (Division 2) (General Federal Law Rules) 2021 (Cth)
Federal Court Rules 2011 (Cth)
Uniform Civil Procedure Rules 2005 (NSW)
Cases cited: ASIC v Michalik No 2 [2004] NSWSC 1260
Coetzee v Government of the Republic of South Africa [1995] ZACC 7
Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375
Deputy Commissioner of Taxation v Ziolkowski No 3 [2019] FCA 443
eSafety Commissioner v Rotondo No 2 [2023] FCA1351
George v Rocket (1990) 170 CLR 104
Gould v Brown (1998) 193 CLR 346
Kazal v Thunder Studios Inc [2017] FCFCA 111
Lacey v Attorney-General (Qld) (2011) 242 CLR 573
Mabo v Queensland No 2 (1992) 175 CLR 1
Mensik v Parbery [2018] FCAFC 101
Minster for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273
Patton v Harrison [No 1] NSWCA 163
Polis v Zombor No 4 [2019] FCA2101
Re Colina; Ex parte Torney (1999) 200 CLR 386
Re Kavanagh (2003) 204 ALR 1
Re Wakim; Ex parte McNally (1999) 198 CLR 511
Registrar of the Court of Appeal v Ritter (1985) 34 NSWLR 64
Rizeq v Western Australia [2017] HCA 23
Schnabel v Lui [2002] NSWSC 1184
Thai v Vilches [2023] FedCFamC2G 1230
Witham v Holloway (1995) 183 CLR 525
Division: Division 2 General Federal Law Number of paragraphs: 62 Date of hearing: 1 March 2024 Place: Sydney Solicitor for the Applicant: Mr U Kruger of Johnson Winter Slattery First Respondent: No Appearance Second Respondent: No Appearance ORDERS
SYG 397 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: GEORGIA GIULIANO
Applicant
AND: FAMILY HOPES PTY LTD (ABN 75 649 191 640)
First Respondent
KRYSTLE ARMOUR
Second Respondent
ORDER MADE BY:
JUDGE STREET
DATE OF ORDER:
1 MARCH 2024
THE COURT ORDERS THAT:
1.The Orders made by Registrar on 7 July 2022 are set aside.
2.The Application in Proceedings for a warrant on the 26 February 2024 is dismissed.
3.The proceedings filed on 17 March 2022 in the Small Claims division is dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE STREET
These were proceedings that were commenced on 17 March 2022 as Small Claims matter under s 548 of the Fair Work Act 2009 (Cth) (“the Act”) against a corporate employer, being the first respondent and a person said to be a director of the company, being the second respondent albeit wrongly named at the time of commencement.
The material filed identified alleged unpaid benefits in relation to the contract of employment, relying relevantly on the Legal Services Award 2020 (“the Award”), clauses 16.3, as well as sections 117 and 324 of the Act, for which wages in the sum of $1,334.68 were claimed as well as an amount for annual leave, and two further amounts purporting to total $2,929.31.
Following the commencement of the proceedings, there was filed an affidavit by the applicant on 13 April 2022. The affidavit purported to be an affidavit of service. It was unsworn and unaffirmed and annexed no relevant ASIC search in respect of the registered address of the corporate employer.
The matter came before the Court on 29 April 2022 and a registrar made orders requiring the filing of an affidavit of service concerning the first respondent and also an affidavit of service in relation to the second respondent.
Following that order, two affidavits were filed by the applicant, one purporting to be an affidavit of service, which again was not sworn or affirmed and again adduced no evidence as to the registered office of the corporate employer, and the second purporting to depose to the circumstances giving rise to the alleged outstanding wages, which was again not sworn or affirmed. The second affidavit did, however, annex some documents that were clearly business records of the employer which identified payment of the applicant for the period from 22 August 2021 to 4 September 2021, and a further business record identifying payment in respect of the period 5 September 2021 to 18 September 2021. There was a signed casual contract dated 23 August 2021 and a purported part-time employment contract, signed by the applicant, with an execution date typed as 13 September 2021 and unsigned by the first respondent, for commencement on 13 September 2021. There was a dispute that the applicant became part-time and an allegation of alteration of employment records and the payment records are not consistent with the alleged end of casual employment and start of the alleged part-time employment, nor are the rates as specified in the alleged part-time employment contract. Whilst s548(3) of the Act provides that the Court is not bound by the rules of evidence and procedure and may act in an informal manner without regard to legal technicalities, there must still be compliance with requirements of procedural fairness and proof of service upon the correctly named entity is an essential requirement. Equally the Court in Small Claims matters must still apply the applicable substantive law and cannot pronounce orders unfounded on any rule or provision or make orders concerning parties not within the scope of jurisdiction applicable to the Small Claims matters.
There were annexed other purported communications to the affidavit, including one dated 15 October 2021 from the first respondent that summarised the payments made purportedly by the employer and identified the payment that had been made from 22 August 2021 to 4 September 2021 on a casual employment basis Level 3 and from 5 September to 18 September 2021 on a part-time employment basis classification Level 3 and that there was an outstanding point five of an hour pay and asking how that was to be received. This part-time employment bases period is inconsistent with the alleged part-time contract commencing 13 September 2021 during which the applicant clearly remained a casual employee. It is apparent from the hourly rate that this refers to an amount of $31.95 and point five accordingly is approximately $16. That communication dated 15 October 2021 identified a willingness to pay that balance and asked for details as to where the payment should be made. There was no evidence of any further request for payment of the $16 by the applicant and no evidence of a refusal to pay by the first respondent. The annexed contract of employment dated 23 August 2021 identified the applicant was a causal employee and the business records are not consistent with the alleged contract change to part-time employment on 13 September 2021 and supports that the applicant remained a casual employee.
Notwithstanding that there was no proper sworn or affirmed evidence as to the first respondent, a registrar on 27 May 2022 proceeded to make orders about service on the individual named as the second respondent, notwithstanding the obvious error in the name of the second respondent individual which had not been corrected on the process to be served, and purporting to make orders that, following the taking of certain steps, the second respondent would be deemed to be served, standing the matter over to 7 July 2022.
On 7 July 2022, a registrar made orders amending the name of the individual, being the second respondent, and made an order, “The respondents pay the applicant the sum of $1,200 in respect of unpaid wages, payment in lieu of notice of termination, annual leave entitlements and interest.” As a casual worker the applicant would not be entitled to notice of termination or annual leave entitlements. This Court has power pursuant to s 256(2) of the Act, on its own initiative to review the exercise of power by the Registrars in this case.
There was no evidence adduced before the Court of the steps taken to effect service upon the second respondent, nor any evidence at that stage as to service upon the first respondent. The basis for the purported order as to the sum of $1,200 is not identified or apparent on the face of the order, nor have any apparent reasons been published. The business records only supported a possible outstanding amount of $16 to the applicant as a casual employee and no evidence as to the provision of information as to the account for payment and no evidence of any refusal to pay the same. The admissible evidence only supported the possible making of an order for $16 in favour of the applicant as a casual employee and there was no apparent refusal to pay that by the first respondent. Without evidence as service upon the first respondent, request for payment, the account for payment information being provided and refusal, there was no proper basis to enter judgment against either respondent and no proper basis for the actual sum ordered.
The Court does have power to proceed to make summary orders under for example rule 13.05 where it finds there was a relevant default under the rule 13.04 of the Federal Court and Family Court of Australia (Division 2) (General Federal Law Rules) 2021 (Cth) (“the GFL Rules”). But no basis for default was identified nor any rule or provision to support the orders purported made against both respondents. No finding of contravention of a specific provision was made or any order subject to the limit under s 548(2) of the Act, pursuant to s 545 of the Act. Had there been evidence and findings made in respect of alleged contraventions then an order may have inferred under s545 of the Act. It is not apparent that there is any basis for any finding of a relevant default or to support the Court being satisfied of an alleged contravention to found an order the Court considers appropriate under s 545 of the Act. The nature of the source of power for the making of the order for payment of the said sum is not apparent.
Further, importantly, dealing first with the second respondent, being the individual whose name was purportedly corrected on 7 July 2022, these were proceedings in the Small Claims matter pursuant to s 548 of the Act.
Those Small Claims proceedings are ones that facilitate claims by an employee against the employer. Section 548 of the Act does not facilitate proceedings being taken against a person in respect of alleged knowing involvement in an alleged contravention under s550 of the Act. It is only the employer who may be joined in Small Claims proceedings. There was no jurisdictional basis for the order made by the registrar against the second respondent on 7 July 2022. Quite apart from the absence of any evidence to support service upon the second respondent, or service of correctly named process and given these matters the order of 7 July 2022 as against the second respondent must be set aside.
In relation to the first respondent, the position remains that there was no sworn evidence before the Court identifying service upon the first respondent, no evidence adduced in respect of the registered office of the corporate employer, that being the first respondent, and the absence of any identified basis for the order made on 7 July 2022 as against the first respondent means that that order should also be set aside.
The proceedings continued, with steps being taken by the applicant to seek to enforce the process as a result of the order made on 7 July 2022, entered on 8 July 2022, purporting to identify a liability of $1,200 by the respondents.
On 16 March 2023 an application in a case was filed by the applicant seeking orders for the attendance by the second respondent “to be examined”, but no attention was give to the source of the power or rule under which such examination was to be required.
In support was filed a sworn affidavit annexing a letter dated 19 September 2022 addressed to the respondents demanding payment of the $1200 by 17 October 2022 and enclosing a Form 51 Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) examination notice. The form 51 UCPR 38.1 was illegible due to a copy of the said covering letter which recorded sent on 6 December 2022.
Those procedures included the taking of steps for the making of an examination order by a registrar on 15 August 2023. That order was described as being made “Pursuant to rule 25.11 of the Federal Court and Family Court of Australia ( Division 2) (General Federal Law Rules 2021 (Cth) and rule 38.3 of the Uniform Civil Procedure Rules 2005”. The UCPR are NSW regulations and the examination order followed the format of UCPR 54 and purported to require the second respondent “in her personal capacity and as director of the first respondent” to attend on 19 October 2023 to orally examined “on any material questions”. The second order under the same provisions purported to require the second respondent ‘in her personal capacity and as director of the first respondent” to produce documents. The orders made on 15 August 2023 required service on the second respondent 14 days before the date for production.
There was no evidence a to service and on 13 October 2023 the examination date was vacated and an order made for compliance with an examination order filed on 13 October 2023 at 10:15am on 13 December 2023. There was no fresh examination notice. There was a purported affidavit of service, with the wrong proceeding title, that did not identify the examination order allegedly served and which was not signed by the witness in the jurat signed by the deponent. An order was made on 13 December 2023 purporting to adjourn the examination generally and recording that there was no appearance by the second respondent and that the applicant intends to make an application for an arrest warrant to be issued under Rule 25.06 of the GFL Rules. There is also power to under the Rules to issue a warrant for the arrest of a person, under Rule 16.15 of the GFL Rules, which requires first determination of whether there was lawful excuse. A warrant for arrest may also be issued for contempt in the face of the Court under Rule 20.01 of the GFL Rules and other than in the face of the Court under Rule 20.02 of the GFL Rules.
Rule 25.06 of the GFL Rules relevantly provides as follows:
Failure to attend Court in response to subpoena or order
(1)If the Court has issued a subpoena or made an order that a person attend Court:
a.to give evidence; or
b.to produce a document or thing; or
c.to answer a charge of contempt; or
d.for any other reason;
and the person fails to attend, a party may apply to the Court for an order that a warrant, in accordance with the approved form, issue to the Sheriff, or another person named in the warrant:
e.for the person's arrest and detention in custody until the person is brought before the Court; and
f.for the production of the person before the Court.
(2)Subrule (1) does not limit the power of the Court to punish for contempt.
(3)This rule does not apply to an order or direction of the Court requiring a party to comply with these Rules.
Rule 25.11 of the GFL Rules relevantly provides:
Execution generally
(1)A party may apply to the Court to issue a writ, order or any other means of enforcement of a judgment or order that can be issued or taken in the Supreme Court of the State or Territory in which the judgment or order was made, as if it were a judgment or order of that Supreme Court.
(2)An order made under subrule (1) authorises the Sheriff, when executing the orders of the Court, to act in the same manner as a similar officer of the Supreme Court of the State or Territory in which the order is being executed is entitled to act.
(3)A party who wants to enforce an order in more than one State or Territory may adopt the procedures and forms of process of the Supreme Court of the State or Territory in which the judgment or order was made.
Rule 38.1 of the UCPR (NSW) relevantly provides:
Examination notice
38.1 Examination notice
(1) The person in whose favour a judgment or order has been given or made may, by notice in writing served on the person bound by the judgment or order (an "examination notice"), require that person to do either or both of the following—
a. to provide answers to specified material questions,
b. to produce for inspection by the judgment creditor specified documents in relation to material questions.
(2) An examination notice must specify the period (being not less than 28 days) within which its requirements must be complied with.
Rule 1.06 of the GFL Rules relevantly provide as follows:
Application
(1)It is intended that the practice and procedure of the Court in general federal law proceedings be governed principally by these Rules.
(2)However, if in a particular case the Rules are insufficient or inappropriate, the Court may apply the Federal Court Rules or the Federal Court (Criminal Proceedings) Rules 2 016 in whole or in part and modified or dispensed with, as necessary.
(3)Without limiting subrule (2), the provisions of the Federal Court Rules set out in Schedule 1, apply, with necessary changes, to general federal law proceedings.
……..
The effect of Rule 1.06 (2) and (3) of the GFL Rules is that where this Court’s GFL Rules are insufficient or inappropriate this Court may apply the Federal Court Rules, with necessary changes to the general federal law proceedings. General federal law proceedings are defined by Rule 1.05 of the GFL Rules to mean a proceeding in the Court other than a family law or child support proceeding.
Relevantly Rule 29.11 of the GFL Rules provides as follows:
Directions and orders
(1)At any time after an application under this Part is filed, the Court or a Registrar may give orders or directions for the conduct of the proceeding in relation to the following:
a.the matters in subrule 10.01(3);
b.a stay or interim order;
c.an extension of time for the application;
d.an amendment of the application;
e.the provision of particulars, or further and better particulars, of a ground in an application or response;\
f.the filing of further affidavits by the applicant;
g.the filing by a respondent or other person of a relevant document or other evidence;
h.the filing of affidavits by a respondent.
(2)The Court or a Registrar may:
a.give orders or directions under subrule (1) in Chambers without a hearing; or
b.at the discretion of the Court or a Registrar, require the parties to an application to attend a hearing.
There was before the Court no proper evidence of service upon either respondent, no proper basis for the payment order made on 7 July 2022. No proper evidence to meet the requirements of purported examination order in terms of service of an applicable examination notice and not proper basis identified as to how the State powers under the UCPR had application.
Notwithstanding these issues, it is apparent that the applicant proceeded on the basis that there was an examination order and that the respondents had failed to attend and accordingly on 26 February 2024, the applicant filed an application for a warrant in accordance with r 25.06 of the GFL Rules to be issued to the sheriff for the second respondent’s arrest and detention in custody until the second respondent is brought before the Court.
Rule 25.11(1) of the GFL Rules is similar to which s 213 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) relevantly provides:
Enforcement of judgment
(1)This section does not apply to family law or child support proceedings.
(3)A person in whose favour a judgment of the Federal Circuit and Family Court of Australia (Division 2) is given is entitled to the same remedies for enforcement of the judgment in a State or Territory, by execution or otherwise, as are allowed in like cases by the laws of that State or Territory to persons in whose favour a judgment of the Supreme Court of that State or Territory is given.
(4)Subsection (2) has effect subject to the Rules of Court.
(5)This section does not affect the operation of any provision made by or under any other Act, or by the Rules of Court, for the execution and enforcement of judgments of the Federal Circuit and Family Court of Australia (Division 2).
The equivalent provision in the Federal Court of Australia Act 1976 (Cth) is section 53.
Rule 29.11 of the Federal Court Rules 2011 (Cth) provides as follows:
Order for examination of witness
(1)A party may apply to the Court for an order for:
a.the examination of any person on oath or affirmation before a Judge or before such person appointed by the Court as examiner at any place whether in or out of Australia; or
b.the sending or issue of a letter of request to the judicial authorities of another country to take, or cause to be taken, the evidence of any person.
(2)A party seeking an order under subrule (1) must lodge, with the application, a draft of the order:
a.for an examination; and
b.for the appointment of an examiner; and
c.for a letter of request.
Section 79 of the Judiciary Act 1903 (Cth) provides as follows:
State or Territory laws to govern where applicable
(1)The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.
(1A) For the purposes of subsection (1), a Court exercising federal jurisdiction in a proceeding is taken to be exercising federal jurisdiction in:
a.if the laws of a State or Territory apply to a part of the proceeding because of subsection 68C(5)--that State or Territory; or
b.if paragraph (a) does not apply:
i.if the proceeding is transferred or remitted--the State or Territory to which the proceeding is transferred or remitted; and
ii.otherwise--the State or Territory in which the proceeding is commenced;
except as otherwise provided by the Constitution or the laws of the Commonwealth.
(2)A provision of this Act does not prevent a law of a State or Territory covered by subsection (3) from binding a court under this section in connection with a suit relating to the recovery of an amount paid in connection with a tax that a law of a State or Territory invalidly purported to impose.
(3)This subsection covers a law of a State or Territory that would be applicable to the suit if it did not involve federal jurisdiction, including, for example, a law doing any of the following:
a.limiting the period for bringing the suit to recover the amount;
b.requiring prior notice to be given to the person against whom the suit is brought;
c.barring the suit on the grounds that the person bringing the suit has charged someone else for the amount.
(4)For the purposes of subsection (2), some examples of an amount paid in connection with a tax are as follows:
a.an amount paid as the tax;
b.an amount of penalty for failure to pay the tax on time;
c.an amount of penalty for failure to pay enough of the tax;
d.an amount that is paid to a taxpayer by a customer of the taxpayer and is directly referable to the taxpayer's liability to the tax in connection with the taxpayer's dealings with the customer.
The work done by s 213 of the Act and Rule 25.11 of the GFL Rules could be no broader than the work done by s 79 of the Judiciary Act 1903 (Cth), as otherwise there would be a Gould v Brown (1998) 193 CLR 346 or Re Wakim; Ex parte McNally (1999) 198 CLR 511 issue in respect of the purported conferral of state legislation adding to the powers and jurisdiction of this Court, see s 15A of the Acts Interpretation Act 1901 (Cth).
In Rizeq v Western Australia [2017] HCA 23 at [15], [16],[17],[20], the High Court of Australia made very clear that s 79 of the Judiciary Act 1903 (Cth) operates not to create rights and duties but it operates “to fill a gap in the laws which will regulate matters coming before those Courts and to provide those Courts with powers necessary for the hearing and determination of those matters”.
There must be found a lack of Commonwealth law governing the exercise of federal jurisdiction to hear and determine a matter so as to pick up a State legislative provision under s79 of the Judiciary Act 1903 (Clth). A necessary consequence of that decision is that there must be first identified that there is a gap that permits the picking up of the alleged particular provision in State legislation. Section 79 of the Judiciary Act 1903 (Cth) does not pick up at large the Civil Procedure Act 2005 (NSW) or Uniform Civil Procedure Rules 2005 (NSW). Nor does s 213 of the Act or Rule 25.11 of the GFL Rules, except to the extent that under s 79 of the Judiciary Act 1903(Clth). there exists a gap that permits picking up provisions for the effective enforcement of the Court’s jurisdiction vested in it.
In the present case, it appears to have been assumed that it picked up that Uniform Civil Procedure Rules in relation to the examination process. The Federal Circuit and Family Court’s Rules are supplemented by express incorporation, where the Rules are insufficient or inadequate, of the Federal Court Rules. Those rules have procedures available for examination being rule 29.11 of the Federal Court Rules that do not support the proposition that there is a gap picking up at large the UCPR provisions or picking up UCPR 38.1.
This case, in relation to s 79 of the Judiciary Act1903 (Cth) or the work done by s213 of the Act or Rule 25.11(1) of the GFL Rules is not one where there is a gap to apply the State legislation in respect of the UCPR rule alleged to be a source of an examination order power. The particular alleged gap must be found to exist, as where this Court found that the state legislation in relation to charging orders under s 106 of the Civil Procedure Act 2005 (NSW) in respect of real property is a provision within section 79 of the Judiciary Act1903 (Cth) to fill a gap that is capable of being picked up, see Thai v Vilches [2023] FedCFamC2G 1230.
The Court makes these observation to emphasise the importance of ensuing in relation to the issuing of examination orders that there is a proper jurisdictional basis that has been identified for the making of the examination order, and where it is based on an alleged debt or judgment debt, that there is a sound juristic basis for that judgment debt. In the present case, it is apparent that a sound basis for the sum ordered was missing. The examination orders as framed should not have been issued.
Turning then to the issue of a potential warrant for the arrest of an individual in the circumstances of the present case, there is authority in the Federal Court of Australia in relation to a writ of levy which appears to support an obiter proposition that the law will be undermined if judgment debtors can readily frustrate enforcement of judgments against them see Deputy Commissioner of Taxation v Ziolkowski No 3 [2019] FCA 443 at [10].
In the analogy of search warrants the legislature has to “balance the need for an effective criminal justice system against the need to protect the individual from arbitrary invasions of his privacy and property” and the need “To insist on strict compliance with the statutory conditions governing the issue of search warrants is simply to give effect to the purpose of the legislation” in the unanimous decision of George v Rocket (1990) 170 CLR 104 at [4]-[5].
Whilst there is obviously a very important public interest in ensuring that this Court’s orders are respected and obeyed, that is a very different concept from facilitating steps of arrest in relation to judgment debtors. Although there is a historical distinction between civil and criminal contempt, albeit in significant respects illusory, contempt must be proved beyond reasonable doubt, explained in Witham v Holloway (1995) 183 CLR 525 at [9]-[19] and, contempt proceedings are not an exercise an exercise of criminal jurisdiction, Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375 at [40]. As explained in William v Holloway, supra., non-compliance with orders necessarily constitute an interference with the administration of justice and there is a public interest in vindicating judicial authority. The cardinal feature of the power to punish for contempt in the exercise of judicial power, is a power to be invoked sparingly, and was described by Hayne J as being to protect the due administration of justice, Re Colina; Ex parte Torney (1999) 200 CLR 386 at [112]. The protective nature of contempt proceedings even if also vindicating private rights and interests, was further explained in Kazal v Thunder Studios Inc [2017] FCFCA 111 at [97]; Polis v Zombor No 4 [2019] FCA2101 at [26].
Clearly, this Court’s powers of contempt will give rise to the Court taking steps to ensure that its powers are not flouted in relation to orders made by the Court, but no such contempt process had been taken in the present case.
Where seeking a warrant for arrest in relation to enforcement of alleged indebtedness greater caution must be exercised. Debtors’ Prison for indebtedness is contrary to the fundamental freedom of liberty, that engages the principle of legality in relation to construction of any legislative derogation, see Lacey v Attorney-General (Qld) (2011) 242 CLR 573 at paragraphs [43]-[44].
[43] The objective of statutory construction was defined in Project Blue Sky Inc v Australian Broadcasting Authority (113) as giving to the words of a statutory provision the meaning which the legislature is taken to have intended them to have (114). An example of a canon of construction directed to that objective and given in Project Blue Sky is "the presumption that, in the absence of unmistakable and unambiguous language, the legislature has not intended to interfere with basic rights, freedoms or immunities" (115). That is frequently called the principle of legality. The legislative intention there referred to is not an objective collective mental state. Such a state is a fiction which serves no useful purpose (116). Ascertainment of legislative intention is asserted as a statement of compliance with the rules of construction, common law and statutory, which have been applied to reach the preferred results and which are known to parliamentary drafters and the courts (117). As this Court said recently in Zheng v Cai [118]:
"It has been said that to attribute an intention to the legislature is to apply something of a fiction. However, what is involved here is not the attribution of a collective mental state to legislators. That would be a misleading use of metaphor. Rather, judicial findings as to legislative intention are an expression of the constitutional relationship between the arms of government with respect to the making, interpretation and application of laws. As explained in NAAV v Minister for Immigration and Multicultural and Indigenous Affairs (119), the preferred construction by the court of the statute in question is reached by the application of rules of interpretation accepted by all arms of government in the system of representative democracy."
[44] The application of the rules will properly involve the identification of a statutory purpose, which may appear from an express statement in the relevant statute, by inference from its terms and by appropriate reference to extrinsic materials. The purpose of a statute is not something which exists outside the statute. It resides in its text and structure, albeit it may be identified by reference to common law and statutory rules of construction.
It is also useful to refer to the International Covenant on Civil and Political Rights 1966, signed by Australia on 18 December 1972 and ratified on 13 August 1980 (“ICCPR”) which was relevantly adopted by Australia and annexed in a schedule to the Human Rights Commission Act 1981 (Cth). Whilst not given express force of law its adoption and scheduling to the said Act informs and overtime refines the common law fundamental freedom of liberty not to be derogated from for indebtedness that requires application of the principle of legality in construction of statutory power to arrest, detain or imprison, see Mabo v Queensland No 2 (1992) 175 CLR 1 at 42: Re Kavanagh (2003) 204 ALR 1 at [11]-[13]; Minster for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 287-288.
Article 11 provides as follows:
No one shall be imprisoned merely on the ground of inability to fulfil a contractual obligation.
It is appropriate to consider the construction of Article 11 in the context of informing and refining the common law. In its context, Article 11, follows after Article 8 a non-derogable prohibition against slavery “in all their forms” which catches and proscribes debt bonds. Article 11 also follows Article 9 that records in paragraph 1 that “Everybody has the right to liberty and security of person. No one shall be subjected to arbitrary arrest of detention. No one shall be deprived of his liberty except on such grounds and in accordance with such procedure established by law. Article 9 expands on the procedure referrable to arrest or being detained “on a criminal charge” and right of access to a court as well as compensation for unlawful arrest or detention. Article 11 immediately follows, Article 10 which concerns the treatment of persons deprived of liberty. After Article 11, Article 12 concerns the right to liberty and freedom with a State, including freedom to leave any country and no deprivation of the right to enter his own country.
Article 11 is identified in the ICCPR as being one of the absolute freedoms in Article 4(2). Relevantly, Article 4(2) makes clear Article 11 is an absolute freedom because it is a provision that should not be derogated from. This absolute freedom, as embraced by the common law, further informs the strictures of the principle of legality that must be applied to legislative derogation from the freedom of liberty that should not be derogated from for indebtedness.
In relation to the meaning of “contractual obligation” in Article 11 of the ICCPR, it is to “be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context” under Article 31(1) of the Vienna Convention on the Interpretation of Treaties, and that provision as well as Article 18, make clear that the object and purpose must be taken into account in the construction of the same. The object and purpose extracted from the text was to protect the freedom of liberty by proscribing debtors’ prison. The context which earlier referred to criminal process supports focus of civil process in Article 11. Contractual obligation “une obligation contractuelle” in its ordinary meaning informed by the object and purpose, informed by the said context, catches civil monetary obligations. There is no logical distinction in the civil context as to indebtedness by contract, by judgment, by statute or indeed arising out of a tort. In its context the meaning of contractual obligations is broader that indebitatus asumpsit and should catch civil indebtedness however arising. The travaux preparatoire identifies that “civil” obligation was defeated and that the terms “inability” would exclude fraudulent non-fulfilment. The comparison and context of criminal process means that defeat was, on one view, pyric and that contractual should mean non-criminal. A criminal charge, is addressed by Article 8, and may found arrest or detention. “Une obligation contratuelle” is by its terms civil, and the object and purpose, in its context, supports protection of the freedom of liberty from imprisonment for civil monetary obligations and civil indebtedness howsoever arising. In any event the common law fundamental human right freedom of liberty, informed by a broad approach to Article 11 ratified and annexed to the Human Rights Commission Act 1981 (Cth) over 40 years ago, should be treated, in application of the principle of legality as informed by a freedom from imprisonment for civil monetary obligations or indebtedness.
There was also reference to civil prisoners in the travaux preparatoire, in distinction to criminal process, that supports the observation by the South African Constitutional Court in Coetzee v Government of the Republic of South Africa [1995] ZACC 7 that the ICCPR is an international instrument that “strongly repudiate the core element of the institution of civil imprisonment, namely, the locking -up of people merely because they fail to pay contractual debts”. The text and context supports a conclusion that the object and purpose to proscribe loss of a fundamental freedom being that of liberty due to obligations of contractual performance or indebtedness. The higher source of a contractual obligation by merger or entry of a judgment should not derogate from the common law recognition of that fundamental freedom. So a judgment debt or statutory entrenchment of monetary obligations of a civil nature should not derogate from that fundamental freedom.
The object and purpose of and context of Article 11 of the ICCPR extends to preventing the civil imprisonment of debtors. This means “contractual obligation” should extend to debts howsoever arising. It would be contrary to the object and purpose and context to give these words a meaning that did not attach to non-contractual indebtedness whether a speciality debt under a deed, quantum meriut, quantum valebant, deceit, tort or a monetary obligation created by statute.
The words “merely on the grounds of inability” informed by the object and purpose and context support a meaning “because they fail to pay debts”. Un-willingness, recalcitrance or fraudulent prevention of ability to fulfill, in the context of civil monetary obligations, appears to derogate from the absolute freedom.
The proposed arrest warrant in the present case, can be said to arise out of a contract of employment, and indeed, the purported order referred “in respect of unpaid wages, payment in lieu of notice of termination, annual leave entitlements and interest”. The problem of facilitating imprisonment of debtors was very helpfully addressed by the learned retired John P. Bryson in Debtors’ Prison and Rules of the Prison published in 2019 in Bar News. In that work, the learned Bryson QC identified that in 1841 there was legislation to protect debtors from arrest in the absence of fraud or dishonesty. Another useful article in this area is Imprisonment for Debt in the 1980’s by Bruce Kercher, published in the Western Australian Law Review, The History of Imprisonment for Debt and its relation to the Development of Discharge in Bankruptcy by Jay Cohen published in the Journal of Legal History, (1982) Volume 3, 153, Imprisonment for Debt by Richard Ford, published in the Michigan Law Review (1926) Volume 25, 24; The International Covenant on Civil and Political Rights, 3rd Ed, (2013) by Sarah Joseph and Melissa Castan, Oxford University Press, at 355-356; UN International Covenant on Civil and Political Rights, 3rd Ed, by William A Schabas (2019) at 294-298. These articles and texts re-enforce the vice of debtor prison and the breadth of scope that should be given to the apparent object and purpose of Article 11 as a fundamental freedom in the of the development of the common law and application of the legality principle.
Persons of impecunious means clearly should not be arrested in relation to a debt arising out of or relating to a contract, and, given a purposive construction in the civil context, no such debtor or judgement debtor, whether impecunious or otherwise, should be the subject of such a step that derogates from the broad freedom in Article 11, and arguably now recognised by the common law, without applying the principle of legality to the legislative provision. Where there are corporate officers in relation to proposed to enforcement of a indebtedness obligation arising out of a or relating to a contract, that principle of legality should be applied in the construction of legislation that seeks to derogate from the absolute freedom sourced in Article 11 informing the common law. Accordingly a director should not be the subject of the issue of an arrest warrant, without application of the principle of legality to the legislative provision that seeks to derogate the absolute freedom in Article 11 informing the common law.
Further, before steps are taken, even in relation to enforcement of this Court’s civil orders under the GLF Rules, in respect of the issue of a warrant of arrest, a court consider whether all other appropriate avenues have been exhausted and also consider whether it is appropriate to proceed ex parte. In the present case, for example, there are steps that could have been taken to identify the existence of property if there was a proper judgment debt and seeking to attach that particular property.
There were also other steps available to this Court in relation to contempt under s142 of the Act and, including if convicted for contempt, alternatives of sequestration to that of arrest or imprisonment. Clearly, this Court’s powers of contempt will give rise to the Court taking steps to ensure that its powers are not flouted in relation to orders made by the Court, but no such contempt process had been taken in the present case.
The powers that may be exercised to make an arrest, where a warrant for arrest has issued under Chapter 4 of the Act or under the GFL Rules is addressed by s271 of the Act and the person arresting the arrestee must inform the arrestee of the grounds of arrest.
Applying the principle of legality Rule 25.06 of the GFL Rules does not permit an order for a warrant of arrest issue for failure to comply with an examination order arising out of a contractual obligation or a monetary obligation or indebtedness contrary to the common law fundamental freedom informed by Article 11 of the ICCPR. Specifically there is no reference to examination order. The words in Rule 25.06(1)(d) of the GFL Rules “or for any other reason” are ambiguous and must be read down so not to derogate from the said fundamental freedom. Nor on a strict construction does Rule 25.06 of the GFL Rules permit a warrant for arrest in respect of an alleged examination order made in reliance, in whole or in part, upon the UCPR provision that was not picked up. Further the seeking of a warrant in the present case, did not reflect an exhaustion of all other civil avenues including contempt, and further was not one that was the subject of any proposed condition, carving out, for example, a condition for compliance with a court order, so that the proposed person to be arrested could take the step of compliance to prevent execution of the warrant. Further in this case, there was not an order that a person attend Court and further there was not a person who fails to attend, so as to enliven any power for an order that a warrant issue. Further Rule 25.06(1) had no application to an order made under Rule 25.11.
Where an application in this Court’s general federal law jurisdiction under the GFL Rules is made for the issue of a warrant of arrest, which is heard by the Court, there must be a strict approach to finding a proper basis for the significant step involved in issuing a warrant for arrest and an application of the principle of legality in the construction of the power to issue the same.
Even if related to civil contempt, an order for issuing a warrant of arrest should be a last resort, having exhausted other lesser alternatives and, absent a risk of absconding, should have a conditional bond amount that might be posted to avoid arrest, see Kirby P in Patton v Harrison [No 1] NSWCA 163; cf ASIC v Michalik No 2 [2004] NSWSC 1260 at [25]-[26]. As to the meaning of ‘abscond’ see Kirby P in the Registrar of the Court of Appeal v Ritter (1985) 34 NSWLR 64; Schnabel v Lui [2002] NSWSC 1184 at [9] Where the Court is hearing in open court whether an order should be made for the issue of an arrest warrant, in civil federal jurisdiction, it is exercising the judicial power of the Commonwealth and the Court must be satisfied that there is a jurisdictional basis for order sought, consider whether the hearing should be ex parte or inter parties, that fair process has been followed, apply the principle of legality to the construction of the power as to whether it permits derogation from the absolute freedom of the common law informed by Article 11 of the ICCPR, and that on the evidence it is appropriate to make the order sought. The suggestion of absence of a need to access the strength of a contempt charge, in the civil context, doesn’t seem to give effect to the principle of legality in relation to the absolute freedom of the common law informed by Article 11 of the ICCPR, cf eSafety Commissioner v Rotondo No 2 [2023] FCA1351 at [10]. Albeit, the learned Wigney J observed that it may be the Court would refuse to issue a warrant under a particular rule where the charge was demonstrably defective, bad in form or hopeless, Mensik v Parbery [2018] FCAFC 101 at [84].
The Court has taken the trouble of giving these more detailed reasons because this is the first time this particular matter came before a judge of this Court, upon, the Court notes, referral by a Registrar of the Court, which was entirely appropriate. It is obviously important, where registrars are involved in the Small Claims matter, to ensure that there is a clear understanding of the confinement of that jurisdiction to employers and employees, and secondly, a clear understanding as to the importance of ensuring that steps are taken on sworn or affirmed evidence that is before the Court as to service of initiating process on the correct person or registered office, that there be clearly identify a proper basis for any purported order involving the payment of money, that careful consideration is given to any suggested alleged powers under State legislation and, if a State legislative issue arises, under s 79 of the Judiciary Act1903 (Cth), or allegedly s213 of the Act or Rule 25.11of the GFL Rules, it is not within the delegated powers of registrars and should be referred to a judge of the Court. Equally, as did in fact occur in this case an application for an arrest warrant allegedly within Rule 25.06 arising out of or relating to an alleged civil monetary obligation or debt should be referred to a judge of the Court. The power conferred on a delegate by s254(2)(l) of the Act in respect of Rule 25.06 of the GFL Rules seeking a warrant for the arrest or in relation to Rule 20.02 of the GFL Rules should, as a matter of practice, be referred to a judge of the Court.
In the present case, having looked at the material that has been filed in terms of business records, it is not apparent that the applicant, as a casual employee, had any amount outstanding beyond possibly the sum of $16.
To make it clear, the Court does regard the enforcement of outstanding wages as a most important part of the jurisdiction conferred through the Act. Even small amounts outstanding will be of significance for individuals and will be enforced by the Court.
However, in all of the circumstances of the present case, given the willingness of the first respondent to pay the same, no apparent response by the applicant to that offer, the amount is so trivial, if in fact outstanding, given the unfortunate history of this matter, and use of resources, taking into account the overarching purpose in s 190 of the Act, the Court is not satisfied it is appropriate to permit the proceedings to remain extant as it does not advance the interests of the administration of justice, and is not a proportionate or efficient use of resources.
The Court notes that Mr Kruger, solicitor, appeared for the applicant at the hearing and that the Court raised the above issues of concern in respect of what had occurred with Mr Kruger and gave him an opportunity by a short adjournment to consider whether there was anything else he could say in support of sustaining the orders of 7 July or why the proceedings should not be dismissed, and no further submissions were advanced.
I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Ex- Tempore Reasons for Judgment of Judge Street. Associate:
Dated: 12 March 2024
Giuliano v Family Hopes Pty Ltd [2024] FedCFamC2G 206
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