Innes v AAL Aviation Limited

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FEDERAL COURT OF AUSTRALIA

Innes v AAL Aviation Limited [2017] FCAFC 202

Appeal from: Brewer v AAL Aviation Limited [2016] FCA 93
File numbers: ACD 12 of 2016
ACD 13 of 2016
Judges: TRACEY, BROMBERG AND WHITE JJ
Date of judgment: 12 December 2017
Catchwords:

SUPERANNUATION – Commonwealth statutory arrangements for superannuation – appellants claimed to have been wrongfully denied entry into Commonwealth schemes – whether employees were ‘permanent employees’ or ‘temporary employees’

NEGLIGENCE – claims for negligent misrepresentation – appellate approach to review of factual findings of trial judge – whether trial judge erred in finding that the essential elements of a claim of negligent misrepresentation had not been established

NEGLIGENCE – claims for negligence generally arising from representations about operation of superannuation schemes – duty of care for pure economic loss – whether one appellant had been vulnerable in the requisite sense to a want of care by the respondent.

LIMITATION OF ACTIONS – where negligence of employer alleged to have occurred in the 1970s deprived an employee of a future statutory entitlement to superannuation benefits – discussion of Commonwealth v Cornwell (2007) 229 CLR 519 – whether nature of benefits were distinguishable from those considered in Cornwell to be prospective and contingent and not capable of constituting loss

Legislation:

Australian Airlines (Conversion to Public Company) Act1988 (Cth)

Australian National Airlines Act 1945 (Cth) ss 17, 18

Evidence Act 1995 (Cth) ss 59, 62, 63

Superannuation Act 1922 (Cth) ss 4(6), 51

Superannuation Act 1942 (53 of 1942) (Cth)

Superannuation Act 1971 (46 of 1971) (Cth)

Superannuation Act 1976 (Cth) ss 3, 3(1), 11, 12, 13, 16(2), 25, 45, 53(2), 80, 111, 136, 137, 144A, 144B, 144C, 144D, 144E, 144F, 144G, 144H, Pts V, VI, IX

Statutory Rule 181 of 1980 (Cth)

Statutory Rule No 20 of 1952 (Cth) reg 4

Superannuation (CSS) Former Eligible Employees’ Regulations 1986 (Cth) reg 15B, Sch 11

Limitation Act 1935 (WA) s 38

Limitation Act 2005 (WA) s 13

Limitation of Actions Act 1958 (Vic)

Retirement Benefits Act 1970 (Tas)
Cases cited:

ABN AMRO Bank NV v Bathurst Regional Council [2014] FCAFC 65; (2014) 224 FCR 1

Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; (2001) 117 FCR 424

Briginshaw v Briginshaw (1938) 60 CLR 336

Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 [2014] HCA 36; (2014) 254 CLR 185

Bryan v Maloney (1995) 182 CLR 609

Caltex Oil (Aust) Pty Ltd v The Dredge Willemstad (1976) 136 CLR 529

Commonwealth v Cornwell [2007] HCA 16; (2007) 229 CLR 519

Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297

Fox v Percy [2003] HCA 22; (2003) 214 CLR 118

Hawkins v Clayton (1988) 164 CLR 539

Hill v Van Erp (1997) 188 CLR 159

Innes v Commonwealth [2015] ACTCA 33

L Shaddock & Associates Pty Ltd v The Council of the City of Parramatta (No 1) (1981) 150 CLR 225

Meredith v Commonwealth of…

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Details
Case
[2017] FCAFC 202
Decision Date

CaseChat Overview and Summary

In Innes v AAL Aviation Limited, the appellants claimed to have been wrongfully denied entry into Commonwealth superannuation schemes. The primary dispute centred on whether the appellants were classified as 'permanent employees' or 'temporary employees', which would have determined their eligibility for superannuation benefits. The case also involved claims for negligent misrepresentation and negligence arising from representations about superannuation schemes, as well as issues concerning the limitation of actions for such claims. The Full Court of the Federal Court of Australia was tasked with reviewing the decision of the primary Judge, who had dismissed the appellants' claims.

The central legal issues included the classification of the appellants as 'permanent employees' for superannuation purposes, the elements required to establish a claim of negligent misrepresentation, the duty of care owed by the respondent to the appellants, and the applicability of the limitation period for claims arising from alleged negligence in the 1970s. The court had to determine whether the trial judge correctly assessed the evidence and applied the relevant legal principles to the facts.

The Full Court upheld the primary Judge's findings that neither Mr Innes nor Mr Hunter was a 'permanent employee', thus invalidating their claims regarding the Commonwealth superannuation schemes. The court also found that the appellants failed to establish the requisite degree of knowledge or appreciation on the part of the persons whose statements they claimed forestalled any further action on their part. Additionally, the court held that the appellants did not establish that they would have pursued joining the superannuation schemes but for the alleged misleading advice. The Full Court rejected the argument that the primary Judge erred in his assessment of the evidence and the application of legal principles to the facts.

The Full Court dismissed the appeal and ordered the appellants to pay the respondent's costs of the appeal. The decision emphasised the importance of objective evidence and active pursuit of superannuation entitlements by employees. The court's ruling underscored the necessity for claimants to establish the requisite elements of negligent misrepresentation and to demonstrate that they would have acted differently but for the alleged misrepresentation.

Orders

Orders of the court

1. The appeal be dismissed.

2. The appellant pay the respondent’s costs of the appeal.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Mr Hunter’s evidence was that he had accepted what he had been told and did not take steps to pursue joining Commonwealth superannuation. He said, however, that if he had known that what Mr Kent had said was incorrect, he would have done something about joining by “making waves” and would have “pushed it as far as I could through legitimate channels”.The decision of the primary Judge The primary Judge found that neither Mr Innes nor Mr Hunter was a “permanent employee” of TAA, at [47] and [90]. Further, the Judge held that, even if they had made applications to join the CSF before 30 June 1976, it is improbable that they would have obtained the necessary certification that their employment would continue for at least seven years (see [91]‑[93]). That fact meant, by itself, that Mr Innes and Mr Hunter’s claims with respect to the CSF failed. On his appeal, Mr Hunter accepted that this was so and did not pursue any claim with respect to the CSF. It is evident that the Judge felt significant disquiet about the quality of the evidence presented by the appellants. He considered that the absence of an “objective” record and “satisfactory corroboration” made their cases “difficult”. The Judge referred to the authorities indicating that liability for negligent misstatement depends on it being established that the speaker realised, or at least ought to have realised, that he or she was being trusted to give information or advice on which the other would act. His Honour found that the appellants could not establish “the requisite degree of knowledge or appreciation on the part of those persons who statements they claim forestalled any further action on their part to pursue the question of entry into a Commonwealth superannuation scheme”, at [115]. In this respect the Judge regarded it as significant that each of the applicants had failed “on their own evidence, to take the basic and most obvious step of making a formal or even focussed enquiry with their local Personnel Officer about a matter which was clearly, and obviously, in that domain” (at [109]). The Judge went on to explain the significance of that conclusion:My earlier criticism of the policies and practices being adopted by TAA will not sustain an assumption in favour of the applicants that any enquiry would have been rebuffed, when no enquiry was attempted and no response was elicited. In relation to the claim in negligence, the primary Judge applied the approach of Heerey J in Mulcahy v Hydro‑Electric Commission [1998] FCA 605; (1998) 85 FCR 170, which involved circumstances which were in some respects analogous to those of the appellant’s claims. It will be necessary to return to this decision. In relation to Mr Innes’ individual claim, the Judge concluded:(1)there was no objective support for Mr Innes’ assumption that Mr Tibbs was the appropriate person to approach on the question of superannuation, that Mr Tibbs had any responsibility for superannuation, or that Mr Tibbs would have realised that Mr Innes would rely on what he said, or that it was or would have been reasonable for him to do so, at [167]‑[168];(2)these matters constituted insurmountable obstacles for Mr Innes’ case, at [168];(3)any serious enquiry by Mr Innes should have been made to his personnel officer, at [169];(4)Mr Innes had not actively pursued an interest in joining CSS or CSF, and did not make out a case that he would have pursued joining CSS or CSF but for the alleged misleading advice from Mr Tibbs, at [161] and [175];(5)that if Mr Innes had made out his case, he would have been entitled to entry to the CSS from 1 July 1976 when it commenced, at [176].

Ratio Decidendi

Legal Principle Established

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