Go to Court Franchising Pty Ltd T/A Go to Court Lawyers v Mr Paul Lewis

[2017] FWC 6114

[2017] FWC 6114

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
Section 604 - Appeal of decisions

Go To Court Franchising Pty Ltd T/A Go To Court Lawyers
v
Mr Paul Lewis
(C2017/6250)

DEPUTY PRESIDENT ANDERSON ADELAIDE, 20 NOVEMBER 2017

Dismissal of lawyer by firm of lawyers - unfair dismissal found - application for stay of compensation order pending appeal – permission to appear by external lawyer refused - grounds of appeal assert misapplication of evidence and errors of law – principles applicable to stay applications – balance of convenience – stay granted on condition compensation amount to be paid into interest bearing account

[1] This decision concerns an application by an employer Go to Court Franchising Pty Ltd T/A Go to Court Lawyers (GTC Lawyers) for a stay of an order of the Fair Work Commission pending the hearing and determination of its appeal.

[2] The order sought to be stayed is an order made by Commissioner Hunt on 31 October 2017. In her decision 1 the Commissioner ordered pursuant to section 392(1) of the Fair Work Act 2009 (the FW Act) that GTC Lawyers pay Paul Lewis “the following amount of compensation less tax as required by law…$15,068.08. In addition, GTC Lawyers is to pay superannuation on the amount of $15,068.08 at the rate of 9.5% into Mr Lewis’ superannuation fund.” The Commissioner ordered that these amounts be payable “within 14 days of the date of this decision.”

[3] The primary application before the Commissioner was an application by Mr Lewis under section 394 of the FW Act in which he claimed that his dismissal on 9 March 2017 was harsh, unjust or unreasonable. The Commissioner heard the matter on 5 and 6 July 2017, after which final written submissions were filed by the parties.

[4] The matter concerned the dismissal of a lawyer by a firm of lawyers. At the hearing of the matter the Commissioner declined to grant leave for GTC Lawyers to be represented by a lawyer other than an employed lawyer. 2 At the hearing both parties were self-represented by legally proficient persons.

[5] In her decision of 31 October 2017 the Commissioner found that:

•  there was no valid reason for dismissal having regard to the capacity or conduct of Mr Lewis 3;

• Mr Lewis was not given an opportunity to respond to concerns GTC Lawyers had concerning his capacity or conduct 4;

• Mr Lewis was not warned in relation to unsatisfactory performance except for time billing 5;

• the dismissal was harsh, unjust and unreasonable 6.

[6] In relation to remedy, the Commissioner concluded that:

•  reinstatement was inappropriate 7 but a compensation order would be made;

• Mr Lewis had been employed for a relatively short period of 12 months as a Senior Associate and Senior Civil Supervisor which included management of the firm’s civil matters in Queensland, New South Wales and Victoria 8. Having regard to the evidence, Mr Lewis’s employment would not have continued for an extended period of time9. It would have, however, continued for the next 12 weeks10;

• The amount of compensation payable would be 12 weeks less two weeks paid in lieu of notice, and less $1,855.00 Mr Lewis earned during this period 11;

• No compensation would be payable for losses attributable to the vicissitudes of life, nor for shock or distress 12;

• the compensation order would not be reduced on account of any alleged misconduct 13;

• there was no evidence of the effect of a compensation order on the viability of the employer’s enterprise 14;

• superannuation obligations of the employer would be payable on the compensation amount 15;

•  the compensation order would be payable within 14 days 16 (that is, by 14 November 2017).

[7] GTC Lawyers appeal is made under section 604 of the FW Act. It is listed for hearing and determination by a full bench of the Commission on 28 November 2017. It is to be noted that an appeal can only be considered if the full bench is minded at that time to grant permission to appeal. Directions for the management of the appeal were issued by the Commission on 17 November 2017 17.

[8] Without limiting the circumstances in which permission of appeal may be granted, the grant of permission generally involves the Commission having to be satisfied that a significant issue of principle or law emerges for determination or warrants review, or an error of law or a significant error of fact appears on the face of the decision.

[9] The grounds of appeal advanced by GTC Lawyers assert significant errors of fact (Attachment A to Notice of Appeal) and errors of law (Attachment B to Notice of Appeal).

[10] For the sake of convenience, the significant errors of fact asserted can be grouped into three categories:

1. The Commissioner did not assess whether the evidence in a collective sense established a basis for finding a valid reason for dismissal. She (it is asserted) only considered evidence singularly;

2. The Commissioner misapplied the evidence in that she either failed to make findings the appellant asserts should have been made, or made findings with which the appellant disagrees;

3. The Commissioner wrongly assessed the evidence on the basis of whether misconduct had occurred rather than considering issues of capacity.

[11] The errors of law concern alleged misapplication of legal principles concerning the treatment of evidence discovered after dismissal of alleged valid reasons for dismissal (Shepherd v Felton Textiles of Australia Ltd) 18; the weight to be given to evidence of the lack of opportunity to respond if it would not have altered the outcome (Siriwardana v Dissanayake Busways Blacktown Pty Ltd19); and the consequences of the employer relying on evidence discovered following a dismissal which was not put to an employee for response (ASP Group (Placements) Pty Ltd v O’Loughlin20. GTC Lawyers also assert that the Commissioner misapplied the rule in Jones v Dunkel21 in drawing an inference against the employer for not calling evidence from its Chief Executive officer Mr James Stevens who made the decision to dismiss.

[12] I conducted a hearing of the application for a stay of the compensation order by video conference on 20 November 2017. After a brief adjournment, I delivered my decision on transcript. I now publish my reasons and Order.

[13] Relevant to the consideration of the stay application is the following:

•  the Commissioner’s decision was made on 31 October. Written reasons were published and made available to the parties at that time;

•  GTC Lawyers received the decision on 31 October;

•  GTC Lawyers had 21 days to lodge a notice of appeal against the decision. The 21 day period expired on 21 November. It lodged its appeal on 14 November;

•  The day GTC Lawyers lodged its appeal (including its request for a stay) was the same day it was required, by order of the Commission, to pay the compensation amount to Mr Lewis;

•  GTC Lawyer’s appeal concerns the primary finding that the dismissal was harsh, unjust and unreasonable. It does not appear to directly call into question the terms or calculation of the compensation order;

•  to date, GTC Lawyers has not complied with the Commissioner’s order to pay the compensation amount.

[14] According to the Commissioner, GTC Lawyers is a reasonably large law firm 22. It is not a small business. It operates across the eastern states of Australia. Despite having been refused permission by the Commissioner to be represented by an external lawyer or paid agent at trial, at the hearing of the stay application GTC Lawyers sought permission to be represented by an external lawyer, Mr Preston of counsel. I note that no Notice of Representative Commencing to Act had been lodged with the Commission despite the provision of rule 11 of the Fair Work Commission Rules 2013, although I also note that Mr Preston had been named as the appellant’s representative in the Notice of Appeal.

[15] I refused permission on the ground that Ms Makela is the firm’s Managing Partner, was appearing with Mr Preston, was capable of presenting the employer’s evidence and submissions in support of the stay application and was familiar with the matter as she had represented the employer in proceedings at first instance.

[16] In support of its application for a stay GTC Lawyers contended that the appeal was well founded and had a reasonable prospect of success. The case concerned the standards of conduct and performance which a legal firm could and should be entitled to reasonably expect of its lawyers. It claimed the Commissioner misapplied the evidence in a manner which undermined that principle. It was said that a stay would enable the firm to productively use the funds in the interests of the business whilst the appeal was being determined.

[17] In response, Mr Lewis opposed the stay application. He submitted that the Commissioner found no basis to consider that the order would adversely impact the viability of the employer’s business. He said that he too was the subject of some criticism by the Commissioner in her decision, and that the decision was not one-sided or unfair. He considered it unreasonable for the employer to plan to use funds that it had been ordered to pay to him. He said that he could also use those funds productively. He indicated that he would, if necessary, accept an arrangement whereby the compensation amount ordered be deposited in an interest bearing deposit with the interest so earned being payable in full should the appeal be dismissed.

[18] The principles to be applied by the Commission to the granting of a stay application were summarised in Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited 23:

“The principles concerning whether a stay application will be granted are well-established. They are as stated in Edghill v Kellow-Falkiner Motors Pty Ltd 24:

“In determining whether to grant a stay application the Commission must be satisfied that there is an arguable case, with some reasonable prospect of success, in respect of both the question of leave to appeal and the substantive merits of the appeal. In addition, the balance of convenience must weigh in favour of the order subject to appeal being stayed. Each of the two elements referred to must be established before a stay order will be granted.”

Prospects of Success

[19] Whilst Mr Lewis is entitled to the fruits of his success at first instance, the reality is that an appeal is underway. The appeal is not frivolous though an appeal which concerns matters of evidence must, under the FW Act, identify a “significant error of fact” 25. The appellant’s contention that the Commissioner considered aspects of the evidence in isolation from each other and failed to do so cumulatively may be a basis for an arguable case on appeal with some reasonable prospects of success but only if the appellant can establish that this in fact is what occurred and that this represented a significant error of fact or in the application of the facts.

[20] I note that the appeal asserts errors of law, though these were not advanced in any substantive way in the proceedings for a stay.

Balance of Convenience

[21] I also take into account that the appeal is to be heard relatively soon. I consider it prudent to avoid a circumstance where the compensation ordered is paid only to create a risk that the whole or a portion of it is then ordered to be returned should the appeal be successful in whole or in part. The balance of convenience weighs in that direction.

Conclusion

[22] For these reasons I consider that, on balance, the order of Commissioner Hunt should be stayed pending the hearing and determination of the appeal.

[23] However, I consider that the submission of Mr Lewis that the employer should not have the opportunity to do with these funds as it wishes to be an important consideration. In these circumstances I have decided that the order of Commissioner Hunt will be stayed but on the condition that the full value of the order (($15,068.08 plus 9.5% superannuation totalling $17,090.85) be deposited by the employer by close of business Friday 24 November 2017 into a separate interest bearing bank account and not be used, distributed or withdrawn except in accordance with the determination of the appeal or as otherwise ordered by the Commission. Should permission to appeal not be granted or should the appeal be dismissed those monies, including interest earned will be payable for the benefit of Mr Lewis in a manner consistent with the Commissioner’s decision.

[24] I publish these reasons for decision and an Order giving effect to this decision.

DEPUTY PRESIDENT

Appearances:

Ms M. Makela, for the Appellant.

Mr P. Lewis, for the Respondent.

Hearing details:

2017.

Adelaide, Sydney and Brisbane; by video-link

20 November.

 1   [2017] FWC 4023

 2   Ibid at [4]

 3   Ibid at [252], [349], [398]

 4   Ibid at [366], [400]

 5   Ibid at [372], [401]

 6   Ibid at [402]

 7   Ibid at [405]

 8   Ibid at [2], [411]

 9   Ibid at [413]

 10   Ibid at [415]

 11   Ibid at [442]

 12   Ibid at [443], [444], [438]

 13   Ibid at [437]

 14   Ibid at [410]

 15   Ibid at [443]

 16   Ibid at [441]

 17   Directions, Deputy President Gooley, 17 November 2017

 18 (1931) 45 CLR 359

 19   [2011] FWAFB 6487

 20   [2011] FWAFB 5230

 21 (1959) 101 CLR 298

 22   [2017] FWC 4023 at [373]

 23   [2014] FWC 4276 at [10]

 24   [2000] AIRC 785

 25 Section 400(2) FW Act

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