Green Pitch Pty Ltd v Brisbane City Football Club Ltd
[2021] QCAT 222
QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL
CITATION:
Green Pitch Pty Ltd v Brisbane City Football Club Ltd [2021] QCAT 222
PARTIES: GREEN PITCH PTY LTD (applicant)
v
BRISBANE CITY FOOTBALL CLUB LTD (respondent)
APPLICATION NO/S:
MCD/O000541-20
MATTER TYPE:
Other minor civil dispute matters
DELIVERED ON:
7 June 2021
HEARING DATE:
2 June 2021
HEARD AT:
Brisbane
DECISION OF:
Adjudicator Lember
ORDERS:
The respondent is to pay the applicant the sum of $15,000 by 31 July 2021.
CATCHWORDS:
ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – minor civil dispute – claim for debt or liquidated demand of money – whether a coaching contract was terminated or frustrated – whether cancellation of a sporting competition during COVID-19 was a frustrating event
Public Health Act 2005 (Qld) s 362B
Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3(b), s 13, s 102, Sch 3.
Australian Woollen Mills Pty Ltd v Commonwealth (1955) 93 CLR 546
Bank Line Limited v Arthur Capel & Co [1919] AC 435
Codelfa Constructions Pty Ltd v State Rail Authority of
New South Wales (1982) 149 CLR 337
Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696
Horlock v Beal [1916] 1 AC 486
Metropolitan Water Board v Dick, Kerr & Co [1918] AC 119
National Carriers Ltd v Panalpina (Northern) Ltd [1981] AC 675
Qantas Airways Ltd v Christie (1998) 193 CLR 280
Ringstad v Gollin & Co Pty Ltd (1924) 35 CLR 303
Scanlan’s New Neon Ltd v Tooheys Ltd (1943) 67 CLR 169Tsakiroglou & Co Ltd v Noblee Thorl GmbH [1962] AC 93
APPEARANCES & REPRESENTATION:
Applicant:
D Cliff, Solicitor, Mills Oakley Lawyers
N Green, Director of the Applicant
Respondent:
C Hardie, Solicitor Just Us Lawyers
R Rossi, President of the Respondent
REASONS FOR DECISION
The applicant, a company operated by Mr Green, was contracted by the respondent, a football club, to supply Mr Green in the head coach role for the club’s 2020 football season.
When the season was suspended on account of the COVID-19 pandemic, the applicant’s contract was brought to an early end by the respondent.
The applicant says its contract was terminated by the respondent in circumstances that entitled the applicant to a termination payment contemplated in clause 10(g) of the contract. The respondent says the contract was automatically terminated by an event of frustration and that no further payments are due to the applicant.
By an application for a minor civil dispute – minor debt filed 12 May 2020 the applicant seeks an order that the respondent pay the applicant the sum of $15,000, being the early termination payment provided for in clause 10(g).
In its response filed 8 June 2020, the respondent club seeks that the application be dismissed.
Each party was, with leave, legally represented at the hearing on 2 June 2021.
Facts the parties agree on
The Contract
In or around August 2019, the parties entered into an undated contract[1] commencing 1 October 2019, the terms of which included, relevantly:
[1]Exhibit 3 of the applicant’s documents produced at the hearing.
(a)In recital D, that the applicant was to provide the “Services” to the club “on the terms and conditions set out in this Agreement”;
(b)In clause 2,[2] that the term of the agreement was for “1 year from the Commencement Date”;
[2]Read with Schedule 1- Interpretation, part 2 sub-paragraph 14 of the contract.
(c)In clause 3(d), that the applicant was to provide the “Services” through the “Personnel”, namely, Mr Green;[3]
(d)In clause 3(a), that the “Services” were as set out in Schedule 2 of the contract, namely:
(i) Senior Squad Lead Coach: to oversee and co-ordinate the development of the Senior Football program, comprising the Senior Team, Under 20s and oversee the development of the U18s;
(ii) Role Description: responsible for and measured on the performance of the first team both in terms of game results and performance, and to facilitate and encourage the volunteering of senior players cohort in duties around the club and deliver unique opportunities for footballers to enhance the club’s brand;
(e)In clause 5(a), that in consideration of the applicant providing the services, the club would pay the applicant a “weekly fee which is inclusive of GST calculated in accordance with Schedule 3”;
(f)In clause 10(c), that termination of the contract shall not affect the rights of the parties accrued before or upon or as a result of the termination;
(g)In clause 10(e), that the club may terminate the contract with immediate effect in the events of serious misconduct, conviction for a criminal offence, incapacity, refusal or failure to provide the services by the applicant or Mr Green;
(h)In clause 10(f), that a termination under clause 10(e) disentitled the applicant from any further payments by the respondent;
(i)In clause 10(g), that “if the [club] determines to terminate this Agreement other than pursuant to clause 10(e) then it will pay to the [applicant] any and all amounts then outstanding together with further sum, calculated by multiplying the number of weeks remaining under the Agreement between the termination date and the end of the Term and the weekly fee set out in Schedule 3”; and
(j)In Schedule 1 - Key Terms, part 5, that the remuneration payable for the Services was $30,000 per annum including GST plus a $5,000 bonus including GST for a “Senior Team top 4 finish”.
[3]Per Schedule 1 – Interpretation, part 1 of the contract.
There is no Schedule 3 to the contract. There are two schedules called “Schedule 1” and one called “Schedule 2”. The parties agreed in the hearing that the references to “Schedule 3” throughout the contract were intended to be and operated in practice as a reference to Item 5, Schedule 1 - Key Terms which sets out the remuneration payable to the applicant. This is sensible and I have proceeded on that basis.
The impact of COVID-19 on the season
In 2020, the club’s first grade team played in the National Premier League Queensland (NPLQ) competition controlled or directed by the Football Federation Australia (FFA) and Football Queensland (FQ).
On 29 January 2020, under the Public Health Act 2005 (Qld) (“PHA”) the Queensland Government declared a public health emergency in relation to COVID-19.
On 21 March 2020, the Chief Health Officer for Queensland issued directions under section 362B of the PHA making non-essential mass gatherings illegal until 19 May 2020.
In March, April and May 2020, FQ made a number of announcements, including, relevantly:
(a)Around 12[4] or 18[5] March 2020 FQ announced the immediate suspension of the 2020 season; and
(b)On 1 April 2020 that “Following the statement by ..FFA today that, as a result of the ongoing COVID-19 crisis, the current suspension of all… competitions and associated training will continue and be reassessed by 31 May 2020, FQ has determined to maintain the suspension in Queensland through to 30 June 2020” and “today’s announcement will now enable clubs to progress towards a return to football when the sanctioned competition window opens, and the proposed format of competitions are announced from 1 July to 30 November 2020”;[6] and
(c)On 2 May 2020 that FQ had developed a draft set of “Return to Football in Queensland guidelines to enable the ongoing preparations for the recommencement of community and state football competitions set previously for 1 July” and that “whilst the exact date for any recommencement is subject to further relaxation of Government restrictions… FQ will be ready and will ensure football is well prepared for a return”;[7] and
(d)On 18 May 2020 that FQ had released Return to Training guidelines for the recommencement of training sessions from 12 June 2020.[8]
[4]According to the applicant.
[5]According to the respondent.
[6]Exhibit 4 of the applicant’s documents produced at the hearing.
[7]Exhibit 5 of the applicant’s documents produced at the hearing.
[8]Exhibit 10 of the applicant’s documents produced at the hearing.
The 2020 season opened on or about 22 February 2020 and Mr Green coached four rounds of the NPLQ season before it was suspended. The season re-opened on or around 24 July 2020.
The applicant was paid $15,000 under the contract, in monthly rather than weekly instalments, the last of which was paid on 4 April 2020.
The balance payable to the applicant would, if clause 10(g) applied, be $15,000.
By a letter dated 11 May 2020[9] and emailed to the applicant at or around 6pm that day, the respondent notified the applicant that “the contract between Brisbane City Football Club and Green Pitch Pty Ltd for the provision of coaching services is at an end having been frustrated due to the prolonged COVID19 restrictions which have prevented performance”.
[9]Exhibit 6 of the applicant’s documents produced at the hearing.
At or around 8pm on 11 May 2020 the respondent issued a press release notifying sponsors and club members that:
(a)Matt Smith had been appointed as the Senior Men’s Coach in addition to his Football Director’s role at the club; and
(b)John Murphy had been appointed to the role of 1st team assistant coach and Under 20s/16s coach to support Mr Smith.
Where the parties differ
The Services
Although the respondent conceded in the hearing that the description of the services in the contract was “very general”, the respondent says that the applicant’s role was primarily to coach the first-grade team in the NPLQ competition and relies upon the reference to “team results and performance” as performance measures set out in the contract as evidence that the first grade team’s participation in the NPLQ was the essential service which the applicant was to provide under the contract, and which the suspension of the season rendered incapable of performance. In the respondent’s words “ there was very little he (Mr Green) could do”.
The applicant says that the respondent has incorrectly confined the purpose of the contract to guide the first-grade team in matches and training. However, they are not the only elements of the role described for the applicant in the contract.
The applicant says that:
(a)The core of the contract was to “oversee and co-ordinate the Senior football program”. In Mr Green’s words, his role was much larger than just “putting out the cones”.[10] He said his role was also planning the squad and considering issues of recruiting and budgeting, maintaining the wellbeing of the players by keeping in frequent contact with them, evaluating the games they had played and planning training around them, video analysis of players, and directing and facilitating group and individual Zoom sessions.
(b)Mr Green’s role, as with any football coach at the higher level, was more about management, not just on-the-ground coaching at matches;
(c)The applicant continued the role of overseeing and co-ordinating the development of senior football and that the suspension of the season did not prevent the applicant from performing this role of oversight and co-ordination because:
(i) training was delivered via Zoom/virtual platforms;
(ii) players were managed and designated fitness, strength and conditioning tasks and programs (such as weights programs and 5km run time trials); and
(iii) Mr Green spoke to players on a daily basis from 12 March 2020 until 11 May 2020.
[10]Oral evidence given by Mr Green in the hearing.
The respondent says there is no evidence that Mr Green undertook any of those activities during the suspension of the season. In my view, evidence of whether he did perform those activities isn’t necessary: what is relevant is whether the contract was capable of being performed.
The applicant relies heavily on the fact that Mr Smith and Mr Murphy, who were appointed to replace Mr Green, in fact did carry out the tasks that Mr Green was contracted to perform and, therefore, the respondent cannot argue that the contract could not be performed.
Further the applicant relies on the authority of Tsakiroglou & Co Ltd v Noblee Thorl GmbH[11] in which a contract for goods to be shipped between two locations was silent as to the method of delivery. It was held that the closing of the most direct route did not frustrate the contract where there was an alternative, albeit longer route available.
[11][1962] AC 93.
The respondent says that the announcement of Mr Smith and Mr Murphy was reputational/in name only and to protect members and players from concern or panic and said that, in fact, they had “very little to do as well”, until the season re-commenced.
The applicant points out that whilst Mr Smith was already employed by the club when appointed, Mr Murphy was a new employee in respect of whom the club had no entitlement to JobKeeper[12] payments. The applicant says that Mr Smith kept Zoom coaching, and that “there were things to do and they were done” by Mr Smith and Mr Murphy in Mr Green’s place.
[12]The JobKeeper Payment was an Australian Government program that supported businesses significantly affected by the coronavirus (COVID-19) by heavily subsidising their wages via a payment made to eligible employers for eligible employees.
The motive for termination
On 26 March 2020, the respondent sought advice about whether the club could:
(a)Stand Mr Green down without pay;
(b)Extend his contract from 30 September 2020 to when the 2020 season (as extended) ended; or
(c)Terminate his contract effective immediately.
On 3 April 2020 the respondent discovered that it was not eligible for a JobKeeper subsidy for monies payable to the applicant under the contract.
Mr Green was one of thirty (30) coaches in a paid role with the club, but the only one engaged as a contractor rather than an employee[13] and, therefore, the only paid coach in respect of which the respondent was not eligible to receive JobKeeper funding.
[13]Most others were casually employed according to the respondent’s oral evidence at the hearing.
Mr Green was the only coach who was notified by the club that his contract was terminated by frustration. All others were retained by the club, even if stood down.
In the first week of May 2020, Board members of the respondent exchanged views between themselves as to whether the contract could or should be terminated.[14] The respondent relies on this as evidence that the respondent did not, following these discussions, terminate the contract, but, rather, relied on the frustrating event as having terminated it automatically.
[14]Exhibit 13 of the applicant’s documents produced at the hearing.
The applicant says, rather, that frustration appears to have been relied on as a terminating event in bad faith, simply because the respondent wished to avoid the early termination payment.
The Law
Jurisdiction
Schedule 3 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“QCAT Act”) describes a minor civil dispute, amongst other things, as “a claim to recover a debt or liquidated demand of money, of up to the prescribed amount”. The prescribed amount is currently $25,000.00.
I am satisfied that the applicant’s claim is a debt over which the Tribunal has jurisdiction.
Section 13 of the QCAT Act obliges the Tribunal to make orders that it considers fair and equitable to the parties to the proceeding in order to resolve the dispute but may, if the Tribunal considers it appropriate, make an order dismissing the application.
Contracts
A legally enforceable agreement (contract) requires an offer, acceptance of that offer, consideration for the promises made and an intention to create legal relations.[15] The terms must be certain, and the parties must have capacity to contract.
[15]Australian Woollen Mills Pty Ltd v Commonwealth (1955) 93 CLR 546.
It was not contested, and there is no evidence to suggest, that the contract that the applicant seeks to enforce was anything other than a binding contract and I have proceeded on that basis.
Frustration
“Frustration” of a contract occurs when circumstances have arisen, by no fault of either party to the contract, that renders the contract incapable of being performed or that transforms a contractual obligation into a fundamentally different obligation "because the circumstances in which performance is called for would render it a thing radically different from that which was undertaken by the contract ".[16]
[16]Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696, 729; cited with approval by the High Court of Australia in Codelfa Constructions Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337.
Whether the doctrine of frustration will apply to a situation depends on the contract between the parties and the effect the proposed frustrating event has on the ability of the parties to perform their obligations under it.
Examples of when frustration will generally not occur include:
(a)if there is an existing force majeure clause in the contract which operates to cover the circumstances seeking to be deemed a frustrating event;
(b)a delay in an obligation being able to be performed, unless such a delay is for an unreasonable time; or
(c)if the parties have merely suffered hardship, unforeseen loss, or the burden of performance has increased.[17]
[17]National Carriers Ltd v Panalpina (Northern) Ltd [1981] AC 675, 770.
Frustration will be clearly established in an instance where it is impossible to perform an obligation, for example, if performance becomes unlawful.[18]
[18]Scanlan’s New Neon Ltd v Tooheys Ltd (1943) 67 CLR 169.
Determining whether an event is a frustrating event requires consideration of whether the situation in which performance of the contract was originally contemplated has been rendered radically different.[19]
[19]Qantas Airways Ltd v Christie (1998) 193 CLR 280, 317.
In terms of delay, the question is whether the interruption is so long as to “destroy the identity of the work or service, when resumed, with the work or service when interrupted”.[20]
[20]Metropolitan Water Board v Dick, Kerr & Co [1918] AC 119; affirmed by the High Court of Australia in Ringstad v Gollin & Co Pty Ltd (1924) 35 CLR 303, 315.
A contract which is taken to be frustrated will be terminated and outstanding obligations will be discharged. Losses will lie where they fall and, consequently, any expenses incurred, or costs paid in the preparation and performance of an obligation prior to frustration, cannot be recovered.
A party may make a claim in restitution to recover the reasonable value of partial performance if it would be unjust to allow the receiving party to retain the benefit of that performance.
Findings
Was the contract frustrated or terminated?
The respondent relies upon the frustrating event being the indefinite suspension of the 2020 football season by FQ on or about 18 March 2020. They say that event:
(a)was an event over which the parties had no control;
(b)was not contemplated by the contract (there was no force majeure clause);
(c)prevented the applicant from “performing any duties in its role as Lead Coach because all training and football games were suspended indefinitely”;[21] and
(d)is distinguished from mere delay because of its indefinite nature.
[21]Respondent’s written submissions given at the hearing.
The respondent relies on a case involving the detention of a ship in a foreign port during war,[22] in which Lord Justice Shaw of the Privy Council noted that:
...stoppage and loss, having arisen from a declaration of war, must be considered to have been caused for a period of indefinite duration, and so to have effected a solution of the contract arrangements for and dependent upon the completion or further continuance of the adventure… I cannot see room for a condition of affairs which would leave the parties in suspense and feeling that they are bound if the war be short but free if the war be long.[23]
[22]Horlock v Beal [1916] 1 AC 486.
[23]Ibid, 507 and 508.
In Bank Line Limited v Arthur Capel & Co[24] Lord Justice Shaw later noted that:
There may be many cases in which it would be greatly to the advantage of one party that he should have an indefinite, and it may be a prolonged, hold over the other till performance shall become impossible. In my opinion it would be contrary to all sound principle to overlay the effect of the suspense referred to by the necessity of having a consent on both sides to cancellation. No such consent appears to me to be required.
[24][1919] AC 435, 450.
I do not accept the respondent’s submission that the applicant was prevented from “performing any duties” under the contract as a consequence of the suspension of the 2020 NPLQ Season nor that he was indefinitely delayed from doing so.
I prefer the applicant’s argument with respect to the “Services” to be provided by the applicant to the respondent under the contract and adopt their broad view of those services for a number of reasons:
(a)If it were the case that Mr Green’s role was confined to the first-grade team’s in-season matches and training, as the respondent suggests, then the applicant’s appointment would not have commenced in the off-season, namely 1 October 2019, when the playing season did not commence until February 2020. One half of the contractual term was in fact during the off-season when matches aren’t played at all;
(b)The “Services” to be provided under the contract were not drafted in a limited or restrictive way. In the respondent’s own words, they were “very general” – they were for the oversight and development of the senior football program and in that regard weren’t linked to the 2020 NPLQ Season in their express terms at all;
(c)The method of delivery of the services was not specified in the contract; and
(d)Whilst a measure of performance included the results achieved by the first-grade team, the consideration was not dependent on that. In fact, a bonus was paid if a top 4 finish was achieved, but the balance of the contract price was payable to the applicant regardless of performance.
Further, I distinguish the respondent’s case submissions from the current circumstances. In my view, a high-level football team cannot be likened to a ship stuck at port. When it is time for the ship to depart, it can be, with very little preparation (for example, the loading of fuel and supplies for the crew) ready to go. A football team cannot cease activity in the off-season and be ready to play matches on a whim. At all times prior to a season and during the season, even if matches aren’t being played, the team is being recruited, managed, assessed, trained and prepared mentally and physically for match play, and to be club representatives, liaising with sponsors, members and other stakeholders. The oversight and co-ordination of these activities was entrusted to the applicant under the contract and the suspension of the NPLQ did not prevent him – nor others after him - from undertaking that role.
The applicant says that when the 11 May 2020 termination letter was sent, the respondent knew the season was imminently returning due to FQ announcements and that the delay was not “indefinite”. This isn’t relevant because the frustrating event being alleged by the applicant as having terminated the contract was the suspension of the 2020 season on 18 March 2020.
Whilst the provision of match-specific coaching was delayed by the season suspension, and the method of oversight and co-ordination changed, relatively briefly, to an online/virtual delivery method, the identity of the service to be performed was not destroyed, the parties were not left in suspense in terms of the role Mr Green had to play under the contract, and I am not satisfied that the applicant’s obligations under the contract were rendered “radically different” to what it had contracted to provide the respondent.
The motivation for the club’s decision to deem the contract frustrated appears to have been financial/to avoid hardship. Had Mr Green been eligible for JobKeeper the termination may never have eventuated. However, this, in my view, does not impact on the assessment of an event as one of frustration or otherwise.
I find that the contract was not frustrated by the suspension of the NPLQ season on 18 March 2020 because the services to be provided by the applicant under the contract were able to be performed and were, in fact, performed - albeit in a modified delivery method - by Mr Green between 18 March 2020 and until 11 May 2020, and then by Mr Smith and Mr Murphy who replaced him the very same day.
Is a finding against the respondent unfair?
The respondent submitted that a finding in favour of the applicant would be unfair as the respondent is a community football club with a modest income and an award in favour of the applicant could “threaten its continued viability”.
I disregard these submissions, although I do not doubt that the decision will have a financial impact upon the club and consider the situation unfortunate.
Whilst the Tribunal’s obligation is to be fair to both parties, if the financial impact of a decision was relevant to the Tribunal’s decision in a minor debt matter (and I find that it is not), then no doubt, it would also be relevant to consider the converse financial impact of a dismissal of the application on the applicant and, by extension, upon Mr Green.
Further, it would be unfair to the parties, in my view, to disregard the terms of the contract they entered into, and the binding commitments, including financial commitments, they freely and willingly made to each other with the full intention of being legally bound to keep those promises in the absence of such a contract being frustrated.
Decision
As the contract ended on 11 May 2020 by way of termination under clause 10(g) of the contract, rather than by frustration, I find in the applicant’s favour, with the respondent to pay the applicant the balance owing under the contract pursuant to that clause.
Costs
The applicant did not seek reimbursement of its filing fee and I decline to exercise my discretion under section 102 of the QCAT Act in the current circumstances to award it.
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