Hagos v Volvo Group Australia Pty Limited

[2013] FCCA 513

FEDERAL CIRCUIT COURT OF AUSTRALIA

HAGOS v VOLVO GROUP AUSTRALIA PTY LIMITED [2013] FCCA 513

Catchwords:
PRACTICE AND PROCEDURE – Application to add fresh causes of action – application made informally – causes of action sought to be added having no prospects of success – application refused.

Legislation:  

Federal Circuit Court Rules 2001, r.16.01

Applicant: BERHANE HAGOS

Respondent: VOLVO GROUP AUSTRALIA PTY LIMITED

File Number: BRG 1109 of 2011

Judgment of: Judge Jarrett

Hearing date: 23 May 2013

Date of Last Submission: 23 May 2013

Delivered at: Brisbane

Delivered on: 23 May 2013

REPRESENTATION

The applicant appeared in person

Counsel for the Respondent: Mr Saunders

Solicitors for the Respondent: Clinch Long Letherbarrow Lawyers

ORDERS

1. The application to include a cause of action based upon breaches of the employment contract between the applicant and the respondent is refused.

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT BRISBANE

BRG 1109 of 2011

BERHANE HAGOS

Applicant

And

VOLVO GROUP AUSTRALIA PTY LIMITED

Respondent

REASONS FOR JUDGMENT

Ex tempore

1. On 23 August, 2012 the applicant, Berhane Hagos, filed an amended claim under the Fair Work Act2009, alleging contravention of a general protection.  The amended application was the subject of an application by the respondent, Volvo Group Australia Pty Ltd, to strike out certain parts of annexure A, which was incorporated in part G of the relevant form.  The gravamen of the application to summarily dismiss parts of that claim was that the employment contract, pursuant to which the applicant was employed by the respondent, was a fixed term contract and there being no obligation on the respondent to renew the contract for any further term, once it expired by a fluxion of time the contractual relationship between the parties was at an end.

2. The application made by the Mr Hagos carried with it the assertion that his employment with the respondent was terminated, rather than it simply expiring by a fluxion of time. Having regard to the evidence that was then before me and for the reasons that I delivered on 29 November, 2012 I struck out paragraphs 1, 2, 3, 4, 5, 8(a) – I will return to that issue – and 9(a) and 10 of the amended claim made under the Fair Work Act.

3. I note, at this point, that the formal order that issued consequent upon that hearing, which has been once amended in January of this year refers to the whole of paragraph 8 being struck out.  However, when one has regard to the reasons for judgment that I delivered on 29 November and the application made by the respondents, it is clear that what was intended was that paragraph 8(a) be struck out and that the balance of paragraph 8 remain in place.  Certainly, the evidence that has been delivered for the purposes of this trial, which commenced on Tuesday of this week, is consistent with that view. 

4. We are now in the third day of this trial and an issue has arisen about the scope of the claim made by the applicant against the respondent. As I have already indicated, the amended claim is one which utilises Form 4 and seeks to agitate a claim under the Fair Work Act alleging contraventions of a general protections. That is, it is a claim which is based in statute and in particular, the Fair Work Act.

5. The contraventions alleged against the respondent are set out in the form.  It is said that certain general protections have been breached by the respondent and in particular, that it took adverse action against Mr Hagos because he had exercised a workplace right.  The gravamen of that claim centres upon a complaint or inquiry made by Mr Hagos about his employment, which he says was not properly addressed by his employer and which formed part of the reason or indeed, was the sole reason, for his contract of employment not being renewed and which resulted in his probationary period under that contract of employment being extended.  There are some other matters that he raises in his application which he says amounts to adverse action. 

6. On 4 February this year, Mr Hagos brought an application in a case.  It was in the context of some other applications that were then before the Court commenced by the respondent, the details of which are not important for present purposes.  But in Mr Hagos’ application in a case, he sought a raft of orders which would ultimately have determined the case and, if those orders had been made, determined the case in his favour. 

7. Amongst those raft of orders sought are these two orders:

   4) A declaration that the respondent is in breach of the applicant’s employment contract for contravening the terms of the standard employment conditions and/or;

   5) A declaration that Mr Georgiades is in breach of the applicant’s employment contract for contravening the terms of the standard employment conditions.

8. The balance of the relief sought relates to declarations that the respondent and an employee or a former employee of the respondent is in contempt because the company and the witness had committed perjury. It also seeks declarations relating to the relief that Mr Hagos seeks in the principal application under the Fair Work Act. There are some 17 other orders that Mr Hagos sought.

9. I dealt with that application and dismissed it, save for one order which related to a bankruptcy notice that had been issued by the respondent against Mr Hagos.  That matter was dealt with in conjunction with the creditor’s petition that had been presented by the respondent against Mr Hagos.  But the balance of his application was dismissed and at the time the view I took was that all of the matters that he wished to raise in that application in a case which, on one view of it, may well have been an application for summary judgment were inappropriate for summary disposition.  They were the matters which needed to be tested at trial.  The trial was listed for hearing, the parties had filed their evidence and the matter should just proceed in the ordinary course. 

10. There was no application orally made and it was not suggested that the claims for declarations that the respondent and/or Mr Georgiades was in breach of the employment contract should be added to the principal claim for relief under the Fair Work Act. Having said that, it is, of course, the case that the applicant represents himself. He is not a lawyer and so to the extent that one might have expected a person who is legally represented to raise, at the earliest opportunity with the Court, a desire to add a new cause of action to the proceedings, the same expectation might not be made of the applicant.

11. In that context then, paragraphs 5 and 6 of the application in a case might have be seen as an application by Mr Hagos to amend the principal application to add those claims for breach of contract.  The matter is expanded upon in the affidavit that was filed in support of that application – an affidavit by Mr Hagos, filed 4 February, 2013.

12. That affidavit itself is a little confused and confusing because as part of that affidavit, there is an exhibit which is an earlier affidavit of Mr Hagos, filed on 31 January, 2013.  That affidavit appears at page 58 of the bundle of annexures to the affidavit of 4 February, 2013.  At paragraph 169, Mr Hagos sets out what he says in his outline of argument, filed 14 May, 2013 is his evidence relating to a breach or breaches of his employment contract with the respondent.  His outline of argument, filed 14 May, 2013 at paragraph 29, has a heading, “Breach of my Employment Contract”.

13. He then, in his submissions, takes issue with the respondent’s outline of argument and sets out his contention that the employment contract was not a fixed term employment contract but was rather a contract which was open ended.  Thereafter, in paragraphs 30(a), (b), (c) and (d) he sets out his allegations that the respondent was in breach of clause 12, clause 13, clause 19 and clause 25 of the standard conditions of his employment.

14. His outline of argument, in paragraph 30(a), refers back to paragraph 169(a) of his affidavit filed on 31 January, 2013 which, as I have indicated, is an annexure to the affidavit filed on 4 February, 2013.  Having regard to what is in paragraph 169 of the affidavit of 31 January and paragraph 30(a) – 30(d) of the outline of argument, it seems that Mr Hagos relies upon, first of all, clause 13 of the standard conditions to justify his claim that there has been a breach of contract.

15. The standard conditions of employment which Mr Hagos says covers his employment with the respondent are found as an annexure to his affidavit, filed 31 July, 2012.  They are at page 46 and following. 

16. Clause 12 says this:

    Employee Wellbeing

    The Company is concerned as to the ongoing health and welfare of its employees.  Should the company be concerned at any time about your fitness for work then the company may require you to be assessed by a medical practitioner.  If this occurs, then the company will bear the cost of the examination

17. In respect of that clause, Mr Hagos says that Mr Georgiades’ decision to not renew Mr Hagos’ contract of employment on 25 November, 2010 is in breach of clause 12 of that condition because the respondent failed to provide a safe workplace.  First of all, the decision on 25 November, 2010 was a decision made by Mr Georgiades not to extend or renew Mr Hagos’ period of employment.  The letter of 25 November, 2010 communicating that decision to Mr Hagos is in evidence.  I cannot remember the exact reference to it, although it may be annexure BH44 to Mr Hagos’ affidavit filed on 31 July, 2012 – see page 216 in the Court copy of that bundle of annexures which sets out the relevant letter.  So, in deciding not to renew or offer Mr Hagos a further employment contract, Mr Hagos says Mr Georgiades was in breach of clause 12 because he failed to provide a safe workplace. 

18. There are two bases upon which Mr Hagos says a safe workplace was not provided.  The first, is said to be:

    That Mr Georgiades did not comply with his duty of care but failing to take proper action and/or properly investigate my bullying complaints. 

    Secondly:

    Mr Georgiades did not comply with his duty of care by failing to provide me with proper training and supervision between 24 August 2010 and 10 September 2010. 

19. The obligations created by clause 12 of the standard conditions of employment do not speak of a duty of care.  The phrase “duty of care” is a phrase well known to the law of negligence and, in the context of a case concerning master and servant, it is a concept which is well known and dealt with in any number of authorities. 

20. There is no doubt that as an employer, the respondent owed a duty of care to Mr Hagos, but the duty of care does not necessarily spring from the contract – it is simply a matter of common law as between master and servant.  What clause 12 of the standard conditions of employment serves to do, is to provide to the employee, it seems to me, some comfort.  It does not create any particular obligation on the respondent, except to meet the costs of medical examinations when the company – the respondent – requires an employee to undertake a medical examination to confirm that employee’s fitness for work.

21. The clause does not deal with workplace health and safety issues in the sense suggested by Mr Hagos in paragraph 169(a)(1) and (2) of the affidavit of 31 January or in his outline of argument.  It says nothing about taking action to investigate any complaints made by an employee and it says nothing about training and supervision.  It is all about ensuring that the company has the ability to request an employee to undergo a medical examination if the company thinks that that is required and it imposes an obligation on the company to meet the cost of that examination if one is requested.

22. The claim based on that clause is misconceived and, in my view, has no prospect of succeeding. 

23. The next claim is based on a breach of clause 13 of the standard conditions.  Clause 13 of the standard conditions of employment is in these terms:

    Performance measures

    Your performance will be regularly reviewed throughout the period of your employment.  You will be required to complete all documents and questionnaires attend all performance reviews and answer all questions in respect of your performance.

24. The allegation by Mr Hagos is that Mr Georgiades’ decision on 25 November was made without reviewing his performance and therefore he was in breach of 13 of the standard conditions.

25. Mr Hagos’ argument is based on the notion that before there could be a decision about offering him a new contract of employment or extending the term of the one that he already had, there needed to be a performance review.  But clause 13 does not say that.  Clause 13 does not impose an obligation on the employer to carry out performance reviews at all.  What it does is impose an obligation on an employee to complete all documents and questionaries and attend all performance reviews and answer all questions in respect of performance, when required to do so.  Whether an employee will be required to do so or not, is not answered by the terms of the clause.  All it says is:

    Your performance will be regularly reviewed throughout the period of your employment. 

26. It says nothing about the method of the review.  In submissions Mr Hagos referred to company policies and procedures about performance reviews and indeed, there may well be policies and procedures implemented by the company for the purposes of those performance reviews.  No doubt, the second sentence in clause 13 of the standard conditions is there to ensure that employees comply with the company’s policies and procedures.

27. But apart from the generalised statement “that performance will be regularly reviewed” there is no obligation on the employer to provide a performance review at all.  In any event, the evidence before me, given by Mr Georgiades and about which there seems to be no contention, was that he did speak to Mr Hagos’ supervisors for the purposes of ascertaining his suitability for ongoing employment.

28. That cannot seriously be in contest because one of Mr Hagos’ seminal complaints in this case is that his supervisors gave him poor performance reviews.  I do not mean that in the technical sense – his evidence was that they were negative about him and that commenced as long ago as July, 2010.  In my view, a breach of contract based on clause 13 of the standard conditions cannot succeed.

29. The next clause relied upon by Mr Hagos is clause 19 of the standard conditions.  It deals with occupational health and safety, smoking and fitness for work policies.  It is in this form:

    Occupational Health and Safety; Smoking; and Fitness for Work Policies

    It is a condition of your employment that you comply with:

    a)All relevant Federal and State occupational health and safety laws and the Company’s Occupational Health and Safety policy to provide a safe and healthy workplace for yourself, fellow employees and visitors to the Company

    b)The Company’s present non-smoking policy and any future variations to that policy

    c)The Company’s present Fitness for Work policy and any future variations to that policy

    d)Work site specific procedures whether Company or customer owned. 

30. The first thing to notice about that clause is that it imposes an obligation on the employee.  That is, the words “it is a condition of your employment that you comply with” means that what follows are obligations on the part of the employee.  Mr Hagos argues that it is a two-way contract.  There are two parties and it is a contract which binds both parties to it.  Indeed, that is true.  There is no question about that. 

31. But the terms of the contract needs to be construed according to the words used in them and the words used in clause 19 do not serve to impose on the employer any obligation, but rather serve to impose obligations on the employee.  If clause 19 creates no obligations on the part of the respondent, then it can hardly be said that the respondent is in breach of it.  Whilst there is no doubt an obligation on an employer towards its employees to ensure their workplace health and safety, it is not, in this case, an obligation imposed by clause 19 of the standard conditions.  That claim too cannot succeed. 

32. Mr Hagos also relies on clause 25 of the standard terms and conditions, which provides for termination.  Clause 25 provides: 

    Termination

    Your employment may be terminated by either party giving to the other party the appropriate amount of notice, determined by the Award.

    The Company may elect to pay you in lieu of actual notice, or any part of the period of notice, the cash value of the notice period and terminate your employment immediately, irrespective of whether notice is given by the Company or you.

    The Company will be entitled to terminate your employment immediately without notice or payment in lieu if you (this is not an exhaustive list):

    a)commit any serious or persistent breach of any of the provisions of this agreement;

    b)are guilty of serious or persistent misconduct or wilful neglect in the discharge of your employment duties;

    c)are convicted of any criminal offence other than an offence, which in the reasonable opinion of the Company, does not affect your position as an employee;

    d)breach any obligation owed to the Company in relation to Confidential Information;

    e)refuse to obey and comply with any reasonable and lawful direction of the Company;

    f)engage in any conduct which in the opinion of the Board is likely to cause damage to the reputation of the Company; and

    g)breach the Company’s policies in relation to occupational health and safety, discrimination, harassment and equal opportunity.

    Upon termination of your employment, entitlements will be paid as per the Award and relevant clause in the EBA you are respondent to.

    Subject to any agreement to the contrary, on termination you will pay or repay to the Company all sums which you owe the Company (see #26 below), whether those sums are then due to be paid or not.  This agreement constitutes written authority by you to the Company to deduct any sums owing to the Company from any termination payments.

    You agree to immediately deliver to the Company all property belonging to the Company which is in your possession in good working order, including without limiting the foregoing, any documents and confidential information provided in connection with your employment.  You are not entitled to retain a copy of any Company document or confidential information.

    After termination, however occurring, you will not make any representation that you are in any way connected with or interested in the Company’s business and will not provide any media comment, whether directly or indirectly, relating to the affairs and conduct of the business or its officers and employees.”

33. Paragraph 25 sets out the periods of notice and how the contract of employment might be terminated.  As an aside, one of the reasons that Mr Hagos argues in his outline of argument that his contract of employment is not a fixed term contract but rather a contract which is open ended, is that the very existence of clause 25 of the standard terms and conditions is inconsistent with the contract having a fixed term.  He says that the way in which his employment contract could be terminated is set out in clause 25 and it cannot be terminated in any other way. 

34. In my view, the notion that his employment contract might be for a fixed term and at the same time contain a clause which deals with how that contract might be terminated, is entirely consistent, one with the other.  One deals with the length of the contract.  That a contract is for a fixed term says nothing more than, once that term has expired the contract is at an end.  The other, the termination clause, deals with how to bring the contract to an end before the expiry of the term. 

1. Mr Hagos asserts that Mr Georgiades did not give any reasons for his decision not to extend or re-offer an employment contract to him on  25 November, 2010 and that his failure to give reasons for that decision is a breach of clause 25 of the standard conditions of employment.  In my view, nothing in clause 25 of the standard conditions of employment requires the giving of reasons for a termination, if there is a termination.  Much less is there a requirement to give reasons for refusing to offer a further employment contract or to extend the term of a contract which is about to expire. 

2. In my view, a claim based on clause 25 of the standard terms and conditions, cannot succeed. 

3. Whether a party ought to be given leave to agitate a fresh cause of action which is not included in the original process, is an entirely discretionary matter and the discretion is, generally said to be, at large. 

4. There are a number of factors, some of which will be highly relevant in some cases and not so relevant in others which inform the exercise of the discretion.  In this case, it seems to me, that the relevant factors are these.  First of all, the reason why the claim was not included in the initiating process in the first place.  Secondly, the notice that has been given to the respondent of the proposed new cause of action.  Thirdly, any explanation for any delay that there might be in failing to give timely notice of an application to include the fresh cause of action and finally, the prospects of success of the fresh cause of action.

5. As to the first matter, there really is no explanation as to why it was not included in the first place.  It is relevant to take into account that Mr Hagos is not a lawyer and is representing himself and has conducted these proceedings, for the most part, by himself.  He is, nonetheless, articulate.  He is, nonetheless, able to understand the nature and extent of his claims and he has articulated his claims in the material from time to time.

6. There really is no explanation, it seems to me, for his failure to include this claim in his original or the amended initiating application.  That of itself, it not fatal to his application now, but it is a factor of some significance. 

7. Secondly, it seems tolerably clear that notice, of sorts, has been given to the respondent of this particular claim.  It was in Mr Hagos’ application in a case that was filed on 4 February.  It is in his outline of submissions, although they were only delivered a matter of days ago and it is in his affidavit of 31 January which I am prepared to assume for the purposes of these reasons, the respondent received when it received the affidavit of 4 February, 2013.

8. So it is not as if this claim is without notice to the respondent.  But as I indicated during the course of submissions, there is a question of fairness to the respondents involved just as much as there is question of fairness to Mr Hagos.  And a respondent is entitled to take, at face value, the documents that are said to constitute the claim in the matter.  The respondent was entitled to look at the claim, especially in the circumstances where there had been a successful summary dismissal application and consider that the length and breadth of the claims to be made against it and the relief to be sought against it, were set out in the amended initiating application. 

9. Perhaps the most significant factor, however, is the view that I have already articulated that these claims that Mr Hagos wishes to pursue have no prospect of success.  It is important not to over-egg the pudding when one considers an application for leave to add fresh causes of action.  One should not jump to unwarranted conclusions about the strengths of the claims that are to be added. 

10. But in this case, it seems to me, that the claims are so bereft of merit that to permit their joinder would be pointless.

11. Finally, to permit the addition of these claims now, would be to unnecessarily vex the respondent and cause it prejudice.  These are claims which have, for the first time, been formally articulated on the third day of a trial, after the applicant has been cross-examined and  when the applicant has concluded his cross-examination of one of the main witnesses in the respondent’s case.

12. Having regard to all of those matters, and to the extent that there is before me either formally or informally, an application to add fresh causes of action to raise these claims for damages for breach of contract or declarations for breach of contract, the application is refused. 

13. For the sake of completeness, I should add that it seems to me that FCCR 16.01 is not of any assistance to Mr Hagos in this particular case.  Mr Hagos sought to rely upon that rule to suggest that he could raise these claims now, without any leave of the Court to do so.

14. As Mr Saunders of Counsel for the respondent points out, FCCR 16.01 is predicated upon the making of an application by a party for the relevant orders and whilst there is no formal application, one might be convinced to conclude that there is an informal application.  But more than that, FCCR 16.01 is not intended to be a catch all.  It is not intended to be a rule which allows a party to, on very little or short notice, raise any particular claim that he or she thinks might derive out of the evidence that is before the Court.

15. The initiating documents, the responses, the affidavits – this case has no pleadings, unfortunately – all serve to identify, articulate and narrow the issues and to add further issues – breach of contract is a significant claim which broadens the scope of the inquiry in this matter – is, in all of the circumstances, not within, it seems to me, the scope of rule 16.01. 

16. For all of those reasons, the application to add a new cause, or causes, of action is dismissed.

I certify that the preceding fifty (50) paragraphs are a true copy of the reasons for judgment of Judge Jarrett delivered on 23 May 2013

Associate: 

Date:  12 June 2013