Heather Nolan v Hello Hello Pty Ltd

[2014] FWC 6456

[2014] FWC 6456

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Heather Nolan
v
Hello Hello Pty Ltd
(U2014/5605)

COMMISSIONER LEWIN MELBOURNE, 16 SEPTEMBER 2014

Application for relief from unfair dismissal - respondent in voluntary liquidation - application stayed due to the operation of s 500(2) of the Corporations Act 2001 (Cth).

Background

[1] This decision relates to an application for an unfair dismissal remedy, under s 394 of the Fair Work Act 2009 (the Fair Work Act), lodged by Ms Heather Nolan with the Fair Work Commission (the Commission) on 17 March 2014 against Hello Hello Pty Ltd (Hello Hello). Ms Nolan’s employment was terminated by Hello Hello on 26 February 2014.

[2] Hello Hello filed its response to the application on 26 May 2014.

[3] A conciliation was held between Ms Nolan and a representative of Hello Hello on 27 May 2014. The application was not settled at conciliation. The Commission issued directions for materials to be filed and served and listed the matter for hearing.

[4] On 19 August 2014 Ms Nolan rang the Commission to inform it that Hello Hello had gone into liquidation and that Pitcher Partners, a firm of accountants, had been appointed as receivers.

[5] On 20 August 2014 the Commission rang Mr Jack Bentick of Pitcher Partners who confirmed that Hello Hello had gone into administration on 20 August 2014.

[6] On 20 August 2014 the Commission sent an email to Ms Nolan, Hello Hello and Mr Bentick that s 500(2) of the Corporations Act 2001 (Corporations Act) provides as follows:

“After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes.”

[7] The email further indicated that the Commission is not considered to be a “Court” for the purposes of s 500(2) of the Corporations Act and as such it did not have power to grant leave as prescribed in s 500(2) of the Corporations Act for Ms Nolan to continue the unfair dismissal proceeding against Hello Hello. The Commission proposed it would stay the unfair dismissal proceeding pending the granting of leave by a “Court” and gave the parties until 5 September 2014 to provide submissions on that course of action.

[8] The parties did not provide any submissions in relation to the operation of s 500(2) or the staying of the application until leave had been sought from a “Court”.

The state of Hello Hello as at 15 September 2014

[9] A search of the company register hosted on the website of the Australian Securities and Investments Commission (ASIC) for Hello Hello’s ABN number (89 091 300 908) confirms that a receiver was appointed on 20 August 2014, a liquidator was appointed on 26 August 2014, and a notice for a special resolution to wind up the company was lodged with ASIC on 27 August 2014.

Legislative scheme

[10] Section 500(2) of the Corporations Act provides:

“After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes.”

[11] Section 58AA of the Corporations Act defines “court” and “Court” as follows:

“Meaning of court and Court

(1) Subject to subsection (2), in this Act:

“court” means any court.

“Court” means any of the following courts:

(a) the Federal Court;

(b) the Supreme Court of a State or Territory;

(c) the Family Court of Australia;

(d) a court to which section 41 of the Family Law Act 1975 applies because of a Proclamation made under subsection 41(2) of that Act.

(2) Except where there is a clear expression of a contrary intention (for example, by use of the expression "the Court"), proceedings in relation to a matter under this Act may, subject to Part 9.6A, be brought in any court.

Note: The matters dealt with in Part 9.6A include the applicability of limits on the jurisdictional competence of courts.”

Consideration

[12] In Silalahi v CMI Industrial (Forge) [2012] FWA 7275, Commissioner Jones considered relevant authorities and found that an application under s 394 of the Fair Work Act falls within the meaning of “civil proceedings” under s 500(2) of the Corporations Act, as follows:

“[11] A question arises as to whether an application under s.394 of the Act can be characterised as a “civil proceeding” within the meaning of s.500(2) of the Corporations Act.

[12] Civil proceeding is not defined in the Act. In Re Vassal Pty Ltd (Vassal), Justice King of the Supreme Court of Queensland considered whether the applicant was required to seek leave of the Court, under the Companies (Queensland) Code (the code), to commence an arbitration against Vassal Pty Ltd (Receivers and Managers Appointed). The primary question to be determined was whether arbitration is a civil proceeding within the meaning of the relevant section of the code.

[13] His Honour extracted the following from the judgement of King CJ in Alliance Petroleum Australia (NL) v Australia Gaslight Co (Alliance Petroleum Australia):

“Arbitration is a regular procedure recognised by statute for the resolution of legal claims, differences or disputes between parties. Rules of law are prescribed by statute for the conduct of arbitrations. Statutory powers are conferred on arbitrators. The jurisdiction of the courts is invoked in aid of the arbitration procedure. Attendance of witnesses may be compelled, witnesses may be sworn and wilfully false evidence before an arbitrator constitutes the crime of perjury. The procedure results in an award which is enforceable at law. Arbitration is clearly recognised by the statute as a method of resolving legal disputes alternative to litigation in the courts. I think that in the ordinary use of language such a procedure would be included in the description in the description ‘civil proceedings’.”

[14] Having regard to the authorities and in particular the passage from Alliance Petroleum Australia cited above, Justice Kelly in Vassal found that the phrase “civil proceeding” includes arbitration.

[15] It is abundantly clear that an unfair dismissal application under s.394 of the Act will, unless settled or discontinued for other reasons, result in arbitration. The description of arbitration by Chief Justice King in Alliance Petroleum Australia is apt to describe the process of arbitration conducted in proceedings under the Act.

[16] Having regard to the authorities considered and the nature of arbitration proceedings which follow from a s.394 application, I find that an application under s.394 of the Act falls within the meaning of “civil proceedings” in s.500(2) of the Corporations Act.”

(citations omitted)

[13] I have had regard to the decision in Smith v Trollop Silverwood & Beck Pty Ltd (2003) 142 IR 137 and s 58AA of the Corporations Act and am satisfied that the Commission is not a “Court” for the purposes of s 500(2) of the Corporations Act and would therefore be unable to consider an application to grant leave for Ms Nolan to continue the unfair dismissal application against Hello Hello.

[14] Taking into account the provisions in s 500(2) of the Corporations Act, I am satisfied that Ms Nolan’s application for an unfair dismissal remedy cannot proceed any further except by leave of a “Court”, as defined in s 58AA of the Corporations Act.

Decision

[15] I have decided that Ms Nolan’s application for an unfair dismissal remedy made under s 394 of the Fair Work Act must be stayed pending leave of a “Court” (as defined in s 58AA of the Corporations Act).

COMMISSIONER

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