Gupta v Menulog Pty Ltd
[2022] FCA 1247
•27 October 2022
FEDERAL COURT OF AUSTRALIA
Gupta v Menulog Pty Ltd [2022] FCA 1247
File number(s): SAD 54 of 2022 Judgment of: O'SULLIVAN J Date of judgment: 27 October 2022 Catchwords: PRACTICE AND PROCEDURE – applicants’ application for a suppression order and for the first applicant to be excused from attending future hearings in person – where no grounds exist to make a suppression order – where grounds not sufficient to excuse first applicant from attending in person – respondent’s application for summary dismissal or alternatively strike out of the statement of claim in whole or in part pursuant to s 31A of the Federal Court of Australia Act 1976 (Cth) and rr 26.01 and 16.21 of the Federal Court Rules 2011 (Cth) – where claims pleaded in relation to the second applicant have no reasonable prospect of success and are summarily dismissed – where claims pleaded in relation to the first applicant fail to disclose a reasonable cause of action – where claims pleaded in relation to the first applicant are struck out – leave granted to first applicant to re-plead the statement of claim Legislation: Age Discrimination Act 2004 (Cth)
Disability Discrimination Act 1992 (Cth), ss 5, 6, 7, 8, 42
Fair Work Act 2009 (Cth)
Federal Court of Australia Act 1967 (Cth), ss 31A, 37AG, 37M, 37N
Federal Court Rules 2011 (Cth), r 26.01
Independent Contractors Act 2006 (Cth), ss 8, 9
Workplace Relations Act 1996 (Cth)
Equal Opportunity Act 1984 (SA)
Road Transport and Distribution Award 2020
Cases cited: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552
Allstate Life Insurance Co v Australia & NZ Banking Group Ltd [1994] FCA 636; (1994) 217 ALR 226
Australian Competition and Consumer Commission v Pauls Ltd [2000] ATPR 40,641
Banque Commercial SA (En Liquidation) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279
Brambles Holdings Ltd v Trade Practices Commission [1979] FCA 80; (1979) 40 FLR 364
Chen v Monash University [2016] FCAFC 66
Dey v Victorian Railways Commissioners [1949] HCA 1; (1949) 78 CLR 62
Eagle v Civil Aviation Safety Authority [2014] FCA 1016; (2014) 226 FCR 44
General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125
Polar Aviation Pty Ltd v Civil Aviation Safety Authorityand Ors [2012] FCAFC 97
Radisich v McDonald [2010] FCA 762; (2010) 198 IR 244
Spencer v Commonwealth [2010] HCA 28; (2010) 241 CLR 118
Takemoto v Moody’s Investors Service Pty Ltd [2014] FCA 1081
Division: Fair Work Division Registry: South Australia National Practice Area: Employment and Industrial Relations Number of paragraphs: 56 Date of hearing: 29 June 2022 Counsel for the Applicants: The Applicants appeared in person Counsel for the Respondent: Ms R Davern Solicitor for the Respondent: Kingston Reid ORDERS
SAD 54 of 2022 BETWEEN: TANAY GUPTA
First Applicant
SANTOSH GUPTA
Second Applicant
AND: MENULOG PTY LTD
Respondent
ORDER MADE BY:
O'SULLIVAN J
DATE OF ORDER:
27 OCTOBER 2022
THE COURT ORDERS THAT:
1.The claims brought by the second applicant in [32] and [33] of the statement of claim are summarily dismissed.
2.The balance of the statement of claim is struck out.
3.The first applicant has leave to re-plead the statement of claim to be filed and served by on or before 28 days of the date of this order.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
O’SULLIVAN J:
OVERVIEW
During 2021, the first applicant (Tanay) and his father, the second applicant (Santosh), were delivery drivers for the respondent (Menulog). Tanay was registered with Menulog as a delivery driver and was an independent contractor. He subcontracted to Santosh, who has no contractual relationship with Menulog.
At about the end of July 2021, Menulog restricted Tanay’s account on the basis that Santosh had not complied with restaurant COVID guidelines. Menulog provided seven days’ notice and on 4 August 2021, Menulog permanently removed Tanay’s account as a delivery driver.
Tanay and Santosh issued proceedings claiming a number of causes of action.
Menulog applies for summary dismissal, alternatively that the statement of claim be struck out in whole or in part (summary dismissal application).
In a separate application, the applicants ask for their names to be suppressed (suppression application) and that Tanay be excused from appearing at future hearings in person. They ask that Tanay be permitted to appear by video link (video application).
The summary dismissal application, the suppression application and the video application were all opposed.
The issues arising on these applications are:
(a)Whether the applicants should have their names suppressed?
(b)Whether Tanay is to be excused from appearing in person at future hearings and has permission to appear by video link?
(c)Whether the respondent is entitled to summary judgment in whole or in part? and
(d)If no to (c) above, whether the statement of claim should be struck out in whole or in part?
I heard argument on all the applications on 29 June 2022.
That day, I dismissed the suppression application and the video application on the basis:
(a)I was not satisfied that grounds existed for making a suppression order or non-publication order pursuant to s 37AG of the Federal Court of Australia Act 1967 (Cth) (Act); and
(b)I was not satisfied there were grounds sufficient to order that Tanay should be excused from appearing at future hearings in person and be permitted to appear by video link.
I reserved my decision on the summary judgment application.
It is for the reasons set out below that:
(a)Santosh’s claims in [32] and [33] of the statement of claim have no reasonable prospect of success and are summarily dismissed; and
(b)Tanay’s claims in [1]-[31], [34] and [35] of the statement of claim disclose no reasonable cause of action and are struck out. There will be leave granted to Tanay to re-plead the statement of claim.
SUMMARY DISMISSAL/STRIKE OUT – PRINCIPLES
Summary Dismissal
Menulog relies upon s 31A of the Act and r 26.01 of the Federal Court Rules 2011 (Cth) (FCR) in seeking an order that the proceeding be summarily dismissed.
In Spencer v Commonwealth [2010] HCA 28; (2010) 241 CLR 118, (French CJ and Gummow J) at [25] said that s 31A(2):
… requires a practical judgment by the Federal Court as to whether the applicant has more than a "fanciful" prospect of success. That may be a judgment of law or of fact, or of mixed law and fact. Where there are factual issues capable of being disputed and in dispute, summary dismissal should not be awarded to the respondent simply because the Court has formed the view that the applicant is unlikely to succeed on the factual issue.
Strike out
In the alternative to summary dismissal, the respondent applies to strike out the statement of claim pursuant to FCR 16.21, alternatively, identified paragraphs in the statement of claim. The principles which apply to an application to strike out an action or parts of a pleading are well settled.
In Banque Commerciale SA (En Liquidation) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279, 286, Mason CJ and Gaudron J described the function of pleadings as being to state with sufficient clarity the case that must be met so as to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him, her or it, and incidentally, to define the issues for decision.
In Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552, [57], Gaudron, McHugh, Gummow and Hayne JJ said:
… Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way.
(Citations omitted)
In Agar, the High Court referred to the well-known statements in General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125, 130 per Barwick CJ, that great care must be exercised before depriving a plaintiff of the opportunity of having his or her or its matter heard. The Court also referred to Dey v Victorian Railways Commissioners [1949] HCA 1; (1949) 78 CLR 62, 91 per Dixon J (as his Honour then was) where his Honour said before the summary intervention of the court is invoked to prevent a plaintiff submitting their case for determination in the appointed manner by the court with or without a jury, the position must be very clear. The intricacy of a transaction does not disentitle the court from examining a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious.
Although the passages to which I have referred in both General Steel Industries and Dey dealt with striking out actions which were frivolous and vexatious and an abuse of process, the same principles apply to other grounds upon which a strike out is sought.
In Radisich v McDonald [2010] FCA 762; (2010) 198 IR 244, Gilmour J at [20] referred to Australian Competition and Consumer Commission v Pauls Ltd [2000] ATPR 40,641 (41-747) at [10] (O'Loughlin J) citing Brambles Holdings Ltd v Trade Practices Commission [1979] FCA 80; (1979) 40 FLR 364 at 365, and said that the power to strike out pleadings or portions of pleadings is discretionary and should be employed sparingly and only in a clear case.
The authorities make it clear that the power to strike out a pleading because it discloses no reasonable cause of action is only exercised in plain and obvious cases, where it is clear no reasonable amendment can cure the alleged defect, and there is no reasonable question to be tried: see Allstate Life Insurance Co v Australia & NZ Banking Group Ltd [1994] FCA 636; (1994) 217 ALR 226 (reported Beaumont J 13/9/94); Polar Aviation Pty Ltd v Civil Aviation Safety Authority and Ors [2012] FCAFC 97, [40]-[43].
Where it is concluded that no reasonable cause of action is available to be pleaded, and there would accordingly be no utility in granting leave to re-plead, liberty to re-plead may be refused: Eagle v Civil Aviation Safety Authority [2014] FCA 1016; (2014) 226 FCR 44 at [65] (Bennett J); Takemoto v Moody’s Investors Service Pty Ltd [2014] FCA 1081 at [87] (Flick J).
The pleaded case
The applicants plead in their statement of claim a number of allegations at [7]-[30] which in summary are:
(a)Delivery requests are only displayed on the driver’s phone for 60 seconds, which is a safety risk and can result in the driver receiving a fine: [7]-[8];
(b)Vehicle insurance companies exclude delivery work: [16];
(c)The distance and time from the driver’s location to the drop off address is significantly under-represented and therefore, the delivery drivers are significantly underpaid: [7], [13] and [14];
(d)If a delivery driver does not accept a delivery request, he is penalised by a reduction of further delivery requests: [7];
(e)The time the delivery driver spends waiting at the restaurant for food collection is either not paid adequately or not paid at all: [9];
(f)Delivery requests sometimes disappear after the delivery driver has accepted the request and therefore, the delivery driver is not paid for the driving time: [10];
(g)Menulog reduces the delivery driver’s weekly earnings without providing a notification to the delivery driver. Menulog responded to the applicant’s inquiry by stating earnings displayed are temporary and subject to change: [11], [13] and [14];
(h)Menulog’s employment contract is unfair, harsh and unconscionable under ss 8 and 9 of the Independent Contractors Act 2006 (Cth) (ICA): [12];
(i)Menulog’s employment contract provides for remuneration at a rate that is less than required under the Workplace Relations Act 1996 (Cth) (WRA) / Fair Work Act 2009 (Cth) (FWA): [12];
(j)Menulog employees should be paid in accordance with the Road Transport and Distribution Award 2020: [15];
(k)Delivery drivers pay for the mistakes made by Menulog and the restaurants: [16];
(l)Working 16 hour days, seven days a week is an occupational, health and safety risk: [17];
(m)Menulog assigns a similar delivery route to different delivery drivers: [18];
(n)Menulog provides the real-time location of the delivery driver to the restaurant and customers which the applicants allege is a breach of privacy and breach of contract: [19];
(o)Paragraphs 2.4 and 2.5 of Menulog’s employment contract provides that Menulog is not obliged to notify the delivery driver of delivery opportunities. The applicants allege this is unjust and unfair because the driver’s remuneration is dependent on delivery opportunities and is a breach of s 9(1)(f) of the ICA: [20];
(p)Paragraph 4.1 of Menulog’s employment contract provides that a driver must not have a criminal record. The applicants allege the contract is discriminatory and therefore, the contract is unfair and unjust: [22];
(q)Menulog’s employment contract provides that the driver must be over the age of 18. The applicants allege age discrimination under the Age Discrimination Act 2004 (Cth) (ADA) and the Equal Opportunity Act 1984 (SA) (EOA): [22];
(r)Paragraph 5.5 of Menulog’s employment contract provides that neither the driver nor their personnel are entitled to any wages, loadings, superannuation contributions, paid annual holidays, paid public holidays, long service leave, paid personal leave, PAYG payment summary, workers compensation cover, or any other statutory or common law employment benefits. The applicants allege a breach of s 9(1)(e) of the ICA: [23];
(s)Paragraph 13.1 of Menulog’s employment contract provides that delivery drivers are responsible for the rectification of any errors and omissions in the provision of services. The applicants allege that errors by employees are covered by indemnity insurance such that the contract is unfair, unjust and a breach of s 9 of the ICA: [24];
(t)Paragraphs 13.2, 16 and 18 of Menulog’s employment contract breach s 9 of the ICA: [25], [29], [31];
(u)Paragraphs 13.3, 14, 15.2 and 15.3 of Menulog’s employment contract breach the WRA/FWA and s 9 of the ICA: [26]-[28]; and
(v)Paragraph 17 of Menulog’s employment contract is a breach of ss 8 and 9 of the ICA: [30].
Of the allegations summarised above, those giving rise to a potential cause of action are at [12], [15], [17], [20] [22], [23], [24], [25], [26-28], [29], [30], [31]. The remaining allegations are background matters that in the circumstances do not require further analysis.
Allegations specific to Santosh
At [32] and [33] of the statement of claim, Santosh pleads an incident involving Sushi Train at St Clair which he alleges amounted to disability discrimination within the meaning of ss 5 and 6 of the Disability Discrimination Act 1992 (Cth) (DDA). He complained to the Equal Opportunity Commission but his complaint was terminated. He then made a complaint to the South Australian Civil and Administrative Tribunal (SACAT) which was dismissed.
The parties’ submissions
Summary dismissal – respondent’s submission
The respondent submits that the originating application and statement of claim are manifestly inadequate, fail to disclose a reasonable cause of action and any identifiable claim is otherwise an abuse of process of the Court and the proceedings ought to be summarily dismissed.
The respondent submits further that there are no matters of fact to be determined such that the Court can have confidence there are no outstanding factual issues that require testing before summarily dismissing the proceeding, or alternatively, striking out the statement of claim without leave to re-plead.
The respondent acknowledges that Flick J warned in Takemoto at [87], that whilst “caution should be exercised before striking out a pleading, even greater caution should be exercised before refusing a party an opportunity to re-plead”. The respondent contends, however, that the defects in the statement of claim are incurable and that it would therefore be futile for leave to re-plead to be granted.
The respondent refers to ss 37M and 37N of the Act which outline the requirements to comply with the overarching purpose of the civil practice and procedure provisions such as to facilitate the just resolution of disputes according to law and as quickly and inexpensively and efficiently as possible. It submits that the statement of claim does not comply with those obligations and should be struck out in its entirety.
The Santosh Claims – [32] and [33] - respondent’s submissions
The respondent submits, correctly, that [32] and [33] of the statement of claim which plead the Sushi Train incident are claims made solely in relation to Santosh.
The applicants submit that Tanay can make the same claims pursuant to ss 7 and 8 of the DDA. Those provisions provide:
7 Discrimination in relation to associates
(1)This Act applies in relation to a person who has an associate with a disability in the same way as it applies in relation to a person with the disability.
(2)For the purposes of subsection (1), but without limiting that subsection, this Act has effect in relation to a person who has an associate with a disability as if:
(a)each reference to something being done or needed because of a disability were a reference to the thing being done or needed because of the fact that the person has an associate with the disability; and
(b)each other reference to a disability were a reference to the disability of the associate.
(3) …
8 Discrimination in relation to carers, assistants, assistance animals and disability aids
(1)This Act applies in relation to having a carer, assistant, assistance animal or disability aid in the same way as it applies in relation to having a disability.
(2)For the purposes of subsection (1), but without limiting that subsection, this Act has effect in relation to a person with a disability who has a carer, assistant, assistance animal or disability aid as if:
(a)each reference to something being done or needed because of a disability were a reference to the thing being done or needed because of the fact that the person has the carer, assistant, animal or aid; and
(b)each other reference to a disability were a reference to the carer, assistant, animal or aid.
(3) …
That may or may not be so, but in response, the respondent submits the applicants do not refer to anything in [32] and [33] of the statement of claim or their submissions that establish the alleged conduct was discriminatory. The respondent submits further that [32] to [33] also refer to conduct of the employees at Sushi Train and are not allegations against the respondent. I accept these submissions.
There is no dispute that Santosh brought the same claims as he now brings in the statement of claim, in relation to the Sushi Train incident, before SACAT: Gupta v Masa & Associates Pty Ltd & Ors [2021] SACAR 72. The respondent submits that bringing the same claim before this Court is an abuse of process, is the subject of res judicata and therefore, cannot be re-litigated.
Although Santosh makes various complaints about the SACAT decision, including in summary, the decision breached Article 10 of the Universal Declaration of Human Rights and the Tribunal deprived Santosh of procedural fairness when determining his claims of disability discrimination, both the applicants and the respondents accept that appropriate appeal mechanisms existed in the South Australian jurisdiction but were not exercised by Santosh..
The respondent also submits that this Court has no jurisdiction to determine the alleged breaches of the EOA and the alleged breaches of s 42 of the DDA pleaded at [32] and [33] of the statement of claim.
I accept the respondent’s submissions. It is clear this Court does not have jurisdiction to determine breaches of the EOA nor of the criminal offence provisions of the DDA: see generally Chen v Monash University [2016] FCAFC 66.
The claims pleaded in relation to Santosh in [32] and [33] of the statement of claim have no reasonable prospect of success and there will be an order summarily dismissing the claim pleaded in these paragraphs.
The applicants’ other claims
The respondent submits that [1]-[31] and [34] and [35] of the statement of claim plead claims that can only be made by Tanay because he was registered with the respondent and was engaged as an independent contractor to the respondent: SoC [2] and [3]. I accept that submission.
The Menulog Agreement
The applicants contend that the terms of the Menulog contract breaches various provisions of the FWA, the ICA, the DDA and the ADA.
The applicants submit that paragraph 5.1 of the Menulog Agreement states that the contractors are not required to provide services personally and may employ or engage personnel. They submit that paragraph 5.6 states that if personnel are employed by a contractor, the contractor must comply with the provisions of the FWA.
The respondent submits that [4]-[7], [9]-[11], [13] and [14] of the statement of claim are evidence and not allegations of material facts and that [8] is a submission. The respondent is clearly correct and I accept its’ submissions.
At [12] of the statement of claim, Tanay alleges that the Menulog contract was unfair, harsh and unconscionable pursuant to ss 8 and 9 of the ICA, avoids the provisions of the WRA, and provides for remuneration at a rate less than the rate of remuneration for an employee performing similar work.
The respondent submits that [12] of the statement of claim is a submission not an allegation of material facts and that since the WRA is no longer in force, it cannot give rise to a cause of action.
The applicants conceded that the WRA is no longer in force and submitted that they intend to rely on the FWA, however, the applicants did not identify which provision of the FWA upon which they rely.
The respondent submits that ss 8 and 9 of the ICA referred to in [12] of the statement of claim do not identify the conduct or contract term that constitute a breach of those sections such that [12] of the statement of claim does not adequately allege a breach of the provisions relied upon. I accept that submission.
The respondent submits that [15] of the statement of claim is a submission and in any event is irrelevant because there is no allegation before the Court that the Road Transport and Distribution Award 2020 applies. I also accept this submission.
Next, the respondent submits that paragraphs [16] to [21] are submissions and are not allegations of material fact such that they fail to disclose a reasonable cause of action.
The applicants submit that [16] and [17] of the statement of claim relate to s 8 of the ICA, [18] relates to s 9 of the ICA, and that [19] and [21] relate to the FWA.
It is clear that the provisions the applicants rely upon only outline what is a workplace relations matter and what is an unfairness ground. The provisions do not specify the conduct or contract terms constituting a breach of those provisions. Under those circumstances, the statement of claim does not allege a breach of the provisions and legislation referred to.
The applicants plead in [22] of the statement of claim that the Menulog Agreement is discriminatory, unfair and unjust because it does not permit drivers to have a criminal record and that only allowing drivers who are above the age of 18 years is age discrimination contrary to the ADA and EOA.
The respondent submits that [22] of the statement of claim is a submission, is based on no allegation of material fact and fails to disclose a reasonable cause of action. It also submits that this Court does not have jurisdiction to determine breaches of the EOA and there is no provision that makes the contract terms referred to in [22] of the statement of claim discriminatory or unlawful. I accept those submissions.
Finally, the respondent submits that [23]-[35] of the statement of claim are submissions and plead no material facts and are such that the pleading fails to disclose a reasonable cause of action. I accept that submission.
As to the balance of the claims pleaded in the statement of claim, it is common ground that only Tanay is a party to the contract with Menulog. Accordingly, only Tanay has a right to make the pleaded claims in contract against the respondent.
Strike out
As currently pleaded, the statement of claim discloses no reasonable course of action, however, save for the Santosh claim to which I have referred, I decline to summarily dismiss the balance of the claim, however there will be an order striking out the statement of claim.
I am not satisfied at this stage that the defects in the Tanay claims are incurable and accordingly he should be given the opportunity to re-plead the statement of claim.
CONCLUSION
The claims pleaded in relation to Santosh in [32] and [33] of the statement of claim have no reasonable prospect of success and are summarily dismissed.
Tanay’s claims in the balance of the statement of claim disclose no reasonable cause of action and the statement of claim is struck out. I grant leave to the first applicant to re-plead the statement of claim. Tanay is to file and serve an amended statement of claim by on or before 28 days from the date of the orders.
I certify that the preceding fifty-six (56) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice O'Sullivan. Associate:
Dated: 27 October 2022
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