John Holland Pty Ltd v CFMEU
[2009] FMCA 1248
•14 December 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| JOHN HOLLAND PTY LTD v CFMEU & ORS | [2009] FMCA 1248 |
| INDUSTRIAL LAW – Unlawful industrial action – breach of BCII Act – penalty hearing – agreed penalty – relevant considerations. |
| Building and Construction Industry Improvement Act 2005 (Cth) ss.38, 49, 69 Crimes Act 1914 (Cth) s.4AA |
| Stuart-Mahoney v Construction, Forestry, Mining and Energy Union [2008] FCA 1426 Minister for Industry, Tourism & Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 Ponzio v B&P Caelli Constructions Pty Ltd (2007) 158 FCR 543 Construction, Forestry, Mining and Energy Union v Williams [2009] FCA FC 171 Wells v Locarno Management Pty Ltd [2008] FCA 1034 Gibbs v City of Altona (1992) 42 IR 255 Seven Network (Operations) Pty Ltd v Communications, Electrical Electronic, Energy, Information, Postal, Plumbing & Allied Services Union (No.2) [2001] FCA 672 Construction Forestry Mining & Energy Union v Coal & Allied Operations Pty Ltd (No.2) (1999) 94 IR 231 Australian Ophthalmic Supplies Pty Limited v McAlary-Smith (2008) 165 FCR 560 Mornington Inn Pty Ltd v Jordan [2008] FCAFC 70 |
| Applicant: | JOHN HOLLAND PTY LTD ACN 004 282 268 |
| First Respondent: | CONSTRUCTION, FORESTRY, MINING, AND ENERGY UNION |
| Second Respondent: | MARK TRAVERS |
| Third Respondent: | FRANK O’GRADY |
| Fourth Respondent: | SHAUN REARDON |
| File Number: | MLG 459 of 2009 |
| Judgment of: | O'Sullivan FM |
| Hearing date: | 14 December 2009 |
| Date of Last Submission: | 14 December 2009 |
| Delivered at: | Melbourne |
| Delivered on: | 14 December 2009 |
REPRESENTATION
| Counsel for the Applicant: | Mr Harrington |
| Solicitors for the Applicant: | Herbert Geer |
| Counsel for the Respondents: | Ms Walters |
| Solicitors for the Respondents: | Construction, Forestry, Mining and Energy Union |
IT IS DECLARED THAT
The First Respondent, contravened s.38 of the Building and Construction Industry Improvement Act 2005 (BCII Act) by engaging in unlawful industrial action constituted by its officers encouraging and directing the cessation of work by its members on 24 March 2009, at the Applicant’s premises located at Melbourne Airport, Tullamarine, in the state of Victoria, specifically, the T2EP Site (the T2EP Contravention).
The First Respondent, contravened s.38 of the BCII Act by engaging in unlawful industrial action constituted by its officer Travers encouraging and directing the cessation of work by its members on 24 March 2009, at the Applicant’s premises located at Melbourne Airport, Tullamarine, in the state of Victoria, specifically, the Carpark Site (the Carpark Contravention).
IT IS ORDERED THAT:
Pursuant to s.49 of the BCII Act and arising out of the T2EP Contravention, the First Respondent is to pay a penalty in the sum of $11,500.
Pursuant to s.49 of the BCII Act and arising out of the Carpark Contravention, the First Respondent is to pay a penalty in the sum of $11,500.
The First Respondent pay the amounts in (3) and (4) to the Applicant by 1 February 2010.
The proceedings be otherwise discontinued.
There be no order as to costs.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLG 459 of 2009
| JOHN HOLLAND PTY LTD ACN 004 282 268 |
Applicant
And
| CONSTRUCTION, FORESTRY, MINING, AND ENERGY UNION |
First Respondent
| MARK TRAVERS |
Second Respondent
| FRANK O’GRADY |
Third Respondent
| SHAUN REARDON |
Fourth Respondent
REASONS FOR JUDGMENT
(Ex tempore)
These reasons for decision concern the penalties to be imposed for breaches of the Building and Construction Industry Improvement Act 2005 (Cth) (“the BCII Act”) by the first respondent for conduct at two building sites located near Melbourne Airport in Victoria in March 2009.
By application filed 23 April 2009 John Holland Pty Ltd (“the applicant”) sought declarations and the imposition of penalties against Construction, Forestry, Mining and Energy Union (CFMEU) (“the first respondent”), Mark Travers (“the second respondent”), Frank O’Grady (“the third respondent”) and Shaun Reardon (“the fourth respondent”).
After the proceedings had been commenced and fixed for a hearing, the parties attended a mediation where they were able to reach an agreement that the following orders should be made:
“1.The Orders of 18 August 2009 be vacated.
2.The Applicant have leave to file and serve an Amended Application on or before 11 September 2009.
3.The parties file a Statement of Agreed Facts on or before 9 October 2009.
4.The Applicant will file and serve an Outline of Submissions and any material on which it intends to rely on or before 30 November 2009.
5.The Respondent(s) will file and serve an Outline of Submissions and any material on which it (they) intend(s) to rely on or before 7 December 2009.
6.The matter will be set down for a hearing of penalty on 14 December 2009 at 10.00 am with an estimate of half a day.”[1]
[1] Orders made 11 September 2009
The parties then filed a statement of agreed facts (“S.O.A.F”) with the Court on 27 October 2009 which is Annexure A to these reasons.
Each of the parties filed submissions as contemplated by the above orders and as events transpired the Court was only asked to consider what penalties ought be imposed on the first respondent for reasons that will become clear presently.[2]
[2] the applicant filed submissions on 1 December 2009 and the respondent filed submissions on 10 December 2009
The application
The amended application filed on 11 September 2009 sought the following orders:
“1.The imposition of a pecuniary penalty under s.49(1) and s.49(2) of the BCII Act upon the first respondent for each of two separate breaches of s.38 of the BCII Act on 24 March 2009, namely, at the:
a)2EP Site – Melbourne Airport, commencing at about 5.50am on 24 March 2009; and
b)Carpark Site – Melbourne Airport, commencing at about 7.15am on 24 March 2009.
2.The imposition of a pecuniary penalty upon the second, third and fourth respondent for breaches of each of:
a) s.767(1) of the WR Act; and
b) s.38 of the BCII Act.
3.An order under s.769(1)(b) of the WR Act in respect of the losses sustained by the applicant by reason of the conduct engaged in by each of the respondents.
4.Orders under s.841 of the WR Act and s.49(5) of the BCII Act that any pecuniary penalty imposed by the honourable Court in respect of paragraph 1 and 2 be paid to the applicant.
5.An award of damages to the applicant by reason of the loss and damage it suffered resulting from the each of the respondents’ tortious conduct, namely:
(a) interference with contractual relations; and
(b) inducing breach of contract.
However, as the S.O.A.F makes clear the respondents made certain admissions[3], the parties put before the Court an agreed position on penalty and the applicant sought to discontinue the proceedings against the second to fourth respondents.[4]
[3] see para 2 of S.O.A.F
[4] see para 3 of S.O.A.F
At the hearing on 14 December 2009, the applicant was represented by Mr Harrington of Counsel, and the respondents by Ms Walters.
The applicant relied on its amended application, the S.O.A.F and the submissions;
The respondents relied on the S.O.A.F and their submissions.
Background
The conduct giving rise to these proceedings is as a result of the following events which are drawn from the S.O.A.F.[5]
[5] see paras 4 – 13, 14 – 24 & 28 - 33
It was not contentious that the applicant could bring these proceedings under the BCII Act. It was also agreed that the first respondent (and the second through to fourth respondents as officers of same) could be subject to proceedings for breaches of that Act.[6]
[6] see para 4 – 13 of S.O.A.F
The applicant conducts a business contracting in the civil and engineering construction sector. The applicant was engaged to complete construction works at Melbourne Airport and carried out work for that purpose at two sites, the T2EP and Carpark sites.
The applicant engaged subcontractors to work at the T2EP Site and the Carpark Site, who in turn employed members of the first respondent there.
On the morning of 24 March 2009 the second, third and fourth respondents entered the T2EP Site, as officers of the first respondent, to conduct a meeting with members.
At the conclusion of that meeting persons who had been engaged to perform building construction work at the T2EP Site failed or refused to attend for work. (T2EP Site Industrial Action)
Also on 24 March 2009 but at the Car Park Site later that morning the second respondent as an officer of the first respondent held a meeting with the about 100 workers after which they stopped work. (Carpark Site Industrial Action)
Contraventions
The Statement of Agreed Facts makes clear:
“2.The First Respondent admits that, by reason of the conduct of its officers, the Second to Fourth Respondents inclusive, on 24 March 2009, at each of the T2EP Site and the Carpark Site, it twice contravened s.38 of the BCII Act on that day (the Admissions).
…
25.For the purposes of s.37 and s.38 of the BCII Act, the T2EP Site Industrial Action was unlawful industrial action.
26.For the purposes of s.69 of the BCII Act, the conduct of each of Travers, O’Grady and Reardon referred to at paragraphs 14 to 23 above was:
(a)conduct of an officer of the First Respondent acting in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.
27. In the premises, the First Respondent admits it:
(a)engaged in the 24 March 2009 T2EP Site Industrial Action; and
(b) thereby contravened s.38 of the BCII Act.
…
34.For the purposes of s.37 and s.38 of the BCII Act, the Carpark Site Industrial Action was unlawful industrial action.
35.For the purposes of s.69 of the BCII Act, the conduct of Travers set out at paragraphs 30 to 33 above was:
(a)conduct of an officer of the First Respondent action in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.
36. In the premises, the First Respondent admits it:
(a) engaged in the Carpark Site Industrial Action; and
(b) thereby contravened s.38 of the BCII Act.”
The relevant provisions of the BCII Act
Given the position of the parties, and in light of the S.O.A.F, the relevant provisions of the BCII Act for present purposes are:
Section 38 of the BCII Act which provides:
“A person must not engage in unlawful industrial action.”
“[U]nlawful industrial action” is described in s 37 of the BCII Act as follows:
Building industrial action is unlawful industrial action if:
(a) the action is industrially-motivated; and
(b) the action is constitutionally-connected action; and
(c) the action is not excluded action.”
The expression “building industrial action” is defined in s 36(1) of the BCII Act to mean:
“(a)the performance of building work in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to building work, the result of which is a restriction or limitation on, or a delay in, the performance of the work , where: (i) the terms and conditions of the work are prescribed, wholly or partly, by an industrial instrument or an order of an industrial body; or (ii) the work is performed, or the practice is adopted, in connection with an industrial dispute (within the meaning of subsection (4)); or
(b)a ban, limitation or restriction on the performance of building work, or on acceptance of or offering for building work, in accordance with the terms and conditions prescribed by an industrial instrument or by an order of an industrial body; or
(c)a ban, limitation or restriction on the performance of building work, or on acceptance of or offering for building work, that is adopted in connection with an industrial dispute (within the meaning of subsection (4)); or
(d)a failure or refusal by persons to attend for building work or a failure or refusal to perform any work at all by persons who for building work;
but does not include:
(e)action by employees that is authorised or agreed to, in advance and in writing, by the employer of the employees; or
(f)action by an employer that is authorised or agreed to, in advance and in writing, by or on behalf of employees of the employer; or
(g) action by an employee if:
(i)the action was based on a reasonable concern by the employee about an imminent risk to his or her heath or safety; and
(ii)the employee did not unreasonably fail to comply with a direction of his or her employer to perform other available work, whether at the same or another workplace, that was sage for the employee to perform
Note: See also subsection (2), which deals with the burden of proof of the exception in paragraph (g) of this definition.”
Section 69 of the BCII Act provides:
“(1)For the purposes of this Act, the following conduct in relation to a building association is taken to be conduct of the building association;
(a)conduct of the committee of management of the association;
(b)conduct of an officer or agent of the associate acting in that capacity;
(c)conduct of a member, or group of members, of the association where the conduct is authorised by:
(i) the rules of the association; or
(ii) the committee of management of the association; or
(iii) an officer or agent of the association acting in that capacity;
(d)conduct of a member of the association, who performs the function of dealing with an employer on behalf of the member and other members of the association, acting in that capacity.
(2) Paragraphs (1)(c) and (d) do not apply if:
(a) a committee of management of the building association; or
(b) a person authorised by the committee; or
(c) an officer of the industrial association;
has taken reasonable steps to prevent the action.
(3) In this section:
officer, in relation to a building association, includes:
(a)a delegate or other representative of the association; and
(b) an employee of the association.”
Section 49 of the BCII Act provides:
“(1)An appropriate court, on application by an eligible person, may make one or more of the following orders in relation to a person (the defendant) who has contravened a civil penalty provision:
(a)an order imposing a pecuniary penalty on the defendant;
(b)an order requiring the defendant to pay a specified amount to another person as compensation for damage suffered by the other person as a result of the contravention;
(c)any other order that the court considers appropriate…”
A penalty unit is an amount of $110[7] and under s.38 of the BCII Act the maximum penalty for each contravention thereof by the first respondent is $110,000.[8]
[7] see s.4AA Crimes Act 1914 (Cth)
[8] See s.49(2)(a) BCII Act
Approach to penalty proceedings
The principles that should be applied in the approach to penalty proceedings such as the matter before the Court were not in dispute.
The factors relevant to a penalty for a contravention of the BCII Act have been set out in decisions of the Federal Court so that the factors which are to be considered, in relation to penalty, are now well established; see, eg, Stuart-Mahoney v Construction, Forestry, Mining and Energy Union [2008] FCA 1426 per Tracey J at [40] and citations therein. As Tracey J observed in Stuart-Mahoney at [40], the relevant considerations include:
·The nature and extent of the conduct which led to the breaches.
·The circumstances in which that relevant conduct took place.
·The nature and extent of any loss or damage sustained as a result of the breaches.
·Whether there had been similar previous conduct by the respondent.
·Whether the breaches were properly distinct or arose out of the one course of conduct.
·The size of the business enterprise involved.
·Whether or not the breaches were deliberate.
·Whether senior management was involved in the breaches.
·Whether the party committing the breach had exhibited contrition.
·Whether the party committing the breach had taken corrective action.
·Whether the party committing the breach had cooperated with the enforcement authorities.
·The need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements.
·The need for specific and general deterrence.
In submissions filed on its behalf the applicant referred to the Full Court decision in Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 543 where Lander J at [93], in relation to the purposes for imposing a penalty, said:
“93.There are three purposes at least for imposing a penalty: punishment; deterrence; and rehabilitation. The punishment must be proportionate to the offence and in accordance with the prevailing standards of punishment; R v Hunter (1984 36 SASR 101 at 103. Therefore the circumstances of the offence or contravention are especially important. The penalty must recognise the need for deterrence, both personal and general. In regard to personal deterrence, an assessment must be made of the risk of re-offending. In regard to general deterrence, it is assumed that an appropriate penalty will act as a deterrent to others who might be likely to offend: Yardley v Betts (1979 22 SASR 108. The penalty therefore should be of a kind that it would be likely to act as a deterrent in preventing similar contraventions by like-minded person or organisations. If the penalty does not demonstrate an appropriate assessment of the seriousness of the offending, the penalty will not operate to deter others from contravening the section. However, the penalty should not be such as to crush the person upon whom the penalty is imposed or used to make that person a scapegoat. In some cases, general deterrence will be the paramount factor in fixing: R v Thompson (1975) 11 SASR 217. In some cases, although hardly in this type of contravention, rehabilitation is an important factor.”
In light of those principles the parties in the context of their submissions approached the matter on the basis of the following relevant factors.
The applicant’s submissions addressed the relevant factors at paragraphs 18 to 43 of the submissions filed 1 December 2009.
The respondent’s submissions filed 10 December 2009 addressed the relevant factors at paragraphs [7] and [18] to [30].
Turning then to a consideration of those submissions in light of the relevant factors.
Consideration of relevant factors
The relevant background for the purposes of the first three of the abovementioned factors was contained in the S.O.A.F as follows:
“14.On 24 March 2009, the Work was scheduled to commence at the T2EP Site at 7am.
15.There is a bus assembly area (Bus Area) within the perimeter of the T2EP Site operated and controlled by the Applicant. Persons engaged to provide services at the T2EP Site (construction workers) are regularly directed to attend the Bus Area in order to be shuttled, by bus, to other locations on various work sites within the Site.
16.At about 5.50am on 24 March 2009, the Second Respondent (Travers) entered upon the T2EP Site and went to the Bus Area.
17.At about 5.50am on 24 March 2009, the Third Respondent (O’Grady) entered upon the T2EP Site and went to the Bus Area.
18.At about 5.50am on 24 March 2009, the Fourth Respondent (Reardon) entered upon the T2EP Site and went to the Bus Area.
19.At all material times on 24 March 2009, when in attendance at, and entering upon, the T2EP Site, each of Travers, O’Grady and Reardon were acting as officers of the First Respondent, CFMEU.
20.In the period between 6.15am and 7am on 24 March 2009, each of Travers, O’Grady and Reardon sought to conduct a meeting, and did conduct a meeting, with persons engaged to work on the T2EP Site who were members of the First Respondent CFMEU (the T2EP Site Union Meeting).
21.During the T2EP Site Union Meeting, each of Travers, O’Grady and Reardon, as officers of the First Respondent, and acting on its behalf, encouraged persons engaged to perform building and construction work at the T2EP Site to refuse to perform that work on 24 March 2009.
22.At the conclusion of the T2EP Site Union Meeting, persons engaged to perform building and construction work at the T2EP Site on 24 March 2009 failed and/or refused to attend for work at 7am and thereafter left the T2EP Site (the T2EP Site Industrial Action).
23.None of the relevant construction workers who refused and/or failed to work on the T2EP Site on 24 March 2009, numbering approximately 180, were authorised by the Applicant to leave the site or desist from carrying out their usual building and construction duties on the T2EP Site.
24.The Applicant had not directed or authorised the employees to cease or stop work.
25.For the purposes of s.37 and s.38 of the BCII Act, the T2EP Site Industrial Action was unlawful industrial action.
26.For the purposes of s.69 of the BCII Act, the conduct of each of Travers, O’Grady and Reardon referred to at paragraphs 14 to 23 above was:
(a)conduct of an officer of the First Respondent acting in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.
…
28.The Carpark Site is within the perimeter of the Site, which is in the vicinity of the Melbourne Airport.
29.At about 7.15am on 24 March 2009, the Applicant conducted a pre-start meeting at the lunchroom at the Carpark Site. There were approximately 100 building and construction workers in attendance at the pre-start meeting (the 100 Construction Workers). At the conclusion of this meeting, at about 7.20am, the Applicant sought to commence a toolbox meeting. Travers attended the toolbox meeting at the Carpark Site. Travers announced to the
100 Construction Workers that there would be a meeting outside [of the lunch room] in the car park area (the Travers Meeting Announcement).
30.After the Travers Meeting Announcement, the
100 Construction Workers left the lunchroom and proceeded to the car park area to attend a stop work meeting conducted by Travers (the Travers Meeting).
31.At no time before 24 March 2009 or on 24 March 2009, had the Applicant:
(a) been given notice of the Travers Meeting;
(b) authorised the Travers Meeting; and
(c)permitted any construction worker engaged to perform building and construction work on the Carpark Site to attend the Travers Meeting.
32.During the Travers Meeting, Travers incited, encouraged or directed the 100 Construction Workers to take unlawful industrial action, namely to cease work without authorisation on 24 March 2009.
33.After the Travers Meeting, approximately 92 of the
100 Construction Workers attended the lunchroom, retrieved their belongings and left the Carpark Site and did not return that day (the Carpark Site Industrial Action). The Applicant had not directed or authorised any work to stop on 24 March 2009.
34.For the purposes of s.37 and s.38 of the BCII Act, the Carpark Site Industrial Action was unlawful industrial action.
36.For the purposes of s.69 of the BCII Act, the conduct of Travers set out at paragraphs 30 to 33 above was:
(a)conduct of an officer of the First Respondent acting in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.”
I accept as the applicant put it in submissions that the conduct referred to in paragraph [18] above was in direct contravention of and “struck at the heart of the main object” of the BCII Act.
I also accept the applicant’s submissions that any penalty imposed must reflect the seriousness of the relevant conduct.
In relation to the relevance of prior contraventions the respondent’s submissions were:
“20.The respondents submit the following principle should be applied in the Court’s consideration of prior contraventions:
a.prior contraventions are relevant and may justify heavier sentence than may otherwise be imposed but, in the absence of statute, they cannot lead to the imposition of a penalty that is disproportionate to the gravity of the instant offence: see Veen v The Queen (No. 2) [1988] 164 CLR 465 at 477 - 478;
b.prior contraventions of a different statute and/or of a different character should not be considered as relevant prior contraventions or relevant prior conduct: see Leighton Contractors Pty Ltd & Anor v CFMEU (2006) 164 IR 375 at 390 and Stuart-Mahoney v CFMEU [2008] FCA 1426 at [44];
c.prior contraventions of another autonomous division and/or branch of the first respondent should not be taken into account: see Leighton Contractors Pty Ltd v CFMEU (2006) 164 IR 375 at 390 and Temple v Powell (2008) 173 IR 189 at [63];
d.conduct engaged in prior to 3 October 2006 and for which a contravention was not recorded until 3 October 2006 is not a prior contravention: see Alfred v Walter Construction Group Ltd [2005] FCA 497 at 13;
e.if conduct prior to 3 October 2006 for which a contravention was not recorded prior to 3 October 2006, is taken into account it is to be given less weight than a prior contravention: see R v McInerney (1986) 42 SASR 111 at 113 and 124;
f. In relation to the second respondent, the only prior contraventions which are relevant are those which relate to his conduct (although it is noted in this case the application does not seek a penalty to be imposed on the second respondent).
21.In Leighton Contractors Pty Ltd v CFMEU (Supra) the Supreme Court of Western Australian in fixing a penalty for unlawful industrial action in contravention of s38 of the BCII Act, was referred to eight proceedings against the CFMEU over the previous 6 years. The Supreme Court said at [67] that those contraventions were “of a different nature” than the contraventions then being considered and did not involve contraventions of the BCII Act. Having regard to the approach of the Federal Court in CFMEU v Coal & Allied Operations (No. 2) (1999) 94 IR 231 at 232, “as the correct approach”, the Supreme Court said at 390:
“It is not appropriate to consider all contraventions of any industrial legislation by any branch of the first defendant [the CFMEU] anywhere in Australia.”
and
“It is inappropriate to take account of contraventions of different legislation it therefore appears that the relevant civil penalty contraventions for present purposes are any prior contraventions of the BCII Act…”
22. In Temple v Powell (Supra) Dowsett J at [63] said:
“The respondent submitted that in a large organisation such as the CFMEU, with autonomous state branches, it is not necessarily appropriate to treat conduct by all branches throughout the country as relevant past conduct for the purpose of fixing a penalty in connection with the unlawful conduct of one branch. There is substance in that submission.”
In my view, taking account of what was said in submissions filed by the applicant about similar previous conduct including at paragraphs [38] to [40] of those submissions does weigh in favour of a penalty as a sanction for repeated instances of unlawful conduct.
The Court should also consider a penalty to mark the disapproval of unlawful conduct particularly where that conduct is “calculated and deliberate” or contumelious and there is nothing to suggest that wasn’t the case here.
Whilst there was no evidence as such of expressions of contrition, this needs to be weighed against the co-operation of the respondents that has seen these proceedings confined to the issue of penalty. In this regard I accept the respondent’s submission that the early admissions constitute a demonstration of contrition (albeit by accepting the reality that the admitted conduct was unlawful) and they deserve credit for this.[9]
[9] see respondent’s submissions at para 26 & 27
I bear in mind what the parties have had to say in submissions about the need for specific and general deterrence to be taken into account in coming to a decision on the appropriate penalty.[10]
[10] see applicant’s submissions at para 38-43 and respondent’s submissions at para 28 -30
After written submissions had been filed the decision of the Full Court of the Federal Court in Construction, Forestry, Mining and Energy Union v Williams [2009] FCA FC 171 was delivered.
The submission of the respondents [11] before the Court was not that the contraventions here were directly analogous to those considered on appeal in Construction, Forestry, Mining and Energy Union v Williams [2009] FCA FC 171 (“Williams”) as such. Rather the position was the Court could find that there was one course of conduct.
[11] see respondent’s submissions at paras 23-25
However, in Mornington Inn Pty Ltd v Jordan [2008] FCAFC
70 (“Mornington Inn”) (which was considered in Williams) the majority of the Full Court was considering the reasons for the judge in the decision at first instance treating the contraventions involving the different employees concerned in different ways. At [58] the majority noted it was of real significance for the purposes of the disposition of that appeal that the appellant had explicitly accepted there were
6 separate contraventions rather than a course of conduct representing a single contravention.
In this case the respondents, as was embodied in the S.O.A.F,[12] accepted there were 2 separate contraventions and not one course of conduct. In the circumstances, and applying Mornington Inn, the appropriate course is to take that into account when considering the application of the totality principle.[13]
[12] see S.O.A.F. at Annexure A
[13] see Mornington Inn Pty Ltd v Jordan [2008] FCA FC 70 at [58]
Finally, I accept the position of the parties advanced in submission that where, as is the case here, there are two separate contraventions within short space of time it is “apposite” to apply the totality principle.[14]
[14] see applicant’s submissions at para 44 -45
Given what the authorities say about the need to ensure the sum of the penalties imposed do not result in a total that exceeds what is proper having regard to the totality of the conduct[15] involved I turn to consider the agreed position of the parties on penalty in that light.
[15] see para 44 of applicant’s submissions
Agreement on Penalty
As is made clear in the S.O.A.F and in these reasons the parties have agreed on a penalty to be imposed for the contraventions set out earlier.
The S.O.A.F at paragraphs 37 to 39 set out the following position of the parties on penalty:
“37.The First Respondent has agreed that pursuant to s.49(1)(a) of the BCII Act and the Admissions it makes herein, it shall pay the following sums by way of penalty:
(a)$11,500 for the contravention of s.38 of the BCII Act on 24 March 2009 by reason of the T2EP Site Industrial Action; and
(b)$11,500 for the contravention of s.38 of the BCII Act on 24 March 2009 by reason of the Carpark Site Industrial Action.
38.The Applicant and First Respondent have agreed that, subject to the discretion in the Court to fix an appropriate penalty, the penalty sums set out above at paragraphs 39(a) and (b) are satisfactory, appropriate and within the permissible range in all the circumstances.
39.Pursuant to section 49(5) of the BCII Act, the Applicant seeks an order from the Court that the First Respondent pay the penalty sums to it. The First Respondent consents to such an order.”
In its submissions the applicant’s position was:
“13. Having regard to the Statement of Agreed Facts and these submissions, John Holland and the CFMEU submit that the appropriate quantum of the penalty to be imposed for each contraventions is an amount of $11,500 per contravention, thus a total or aggregate penalty of $23,000. The parties have agreed, in settling the litigation, that this aggregate amount is within the permissible range. This agreement is, of course, subject to the oversight of, and discretion in, the Court.
I accept as was said in Minister for Industry, Tourism & Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 at paragraph [53] that:
“...
(iii) There is a public interest in promoting settlement of litigation…
…
(vi) Where the parties have jointly proposed a penalty, it will not be useful to investigate whether the Court would have arrived at that precise figure in the absence of agreement. The question is whether that figure is, in the Court’s view, appropriate in the circumstances of the case. In answering that question, the Court will not reject the agreed figure simply because it would have been disposed to select some other figure. It will be appropriate if within the permissible range.” (emphasis added)
As the parties acknowledged in submissions and is made clear in the authorities it is for the Court to determine the appropriate penalty having regard to all relevant matters.[16]
[16] see applicant’s submissions at paras 26-32 and respondent’s submissions at para 12
In submissions the respondents referred to the decision in Wells v Locarno Management Pty Ltd [2008] FCA 1034 where Jessup J said:
“The predictability involved in the resolution of penal proceedings in accordance with a pre-trial agreement reached by the parties is something which should as a matter of public policy be regarded as beneficial.”
In the circumstances I accept that the penalty for the unlawful conduct that the parties have put before the Court is neither manifestly inadequate nor manifestly excessive and within the permissible range.
Payment of penalty to the applicant
The Court was told the parties agreed that in the circumstances it was appropriate for any penalty to be paid to the applicant. The applicant’s submissions on this issue which I accept were at paragraphs 46 to 51 of the submissions filed on its behalf. In this regard I note in Gibbs v City Altona (1992) 42 IR 255 Gray J said inter alia:
“the usual order, when the proceedings is not brought by the inspector appointed under the Act, is for payment to the person or organization applying for the penalty”
I also note the decision in Seven Network (Operations) Limited v Communications, Electrical Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (No.2) [2001] FCA 672 as authority for such an order.
Conclusion
Given the matters referred to above I accept as the applicant contended in submissions that an aggregate penalty of $23,000 is “condign” punishment in all the circumstances for two breaches of s.38 of the BCII Act on the same day. Therefore, as the Court:
a)is directed by the relevant authorities to consider what is appropriate in all the circumstances of this case;[17] and
[17] see Construction Forestry Mining & Energy Union v Coal & Allied Operations Pty Ltd (No.2) (1999) 94 IR 231
b)in its discretion in relation to penalty is not fettered by a checklist of mandatory criteria:[18] and
[18] see Australian Ophthalmic Supplies Pty Limited v McAlary-Smith (2008) 165 FCR 560
c)notes the parties have filed a statement of agreed facts and agreed on penalties which are within the permissible range for each offence;[19] and
[19] see Ponzio v B & P Calli Constructions Pty Ltd (2007) 158 FCR 543
d)is satisfied the agreed aggregate penalties are just and appropriate[20] and it is proper to make the declarations and orders sought; and
[20] Ibid
e)is also satisfied (as is agreed), that the penalties by paid to the applicant;[21]
[21] see Seven Network (supra)
there will be orders for all the above reasons as set out at the beginning of these reasons for decision.
I certify that the preceding fifty-six (56) paragraphs are a true copy of the reasons for judgment of O'Sullivan FM
Deputy Associate: Haylee Hobbs
Date: 14 December 2009
ANNEXURE A
IN THE FEDERAL MAGISTRATES COURT File number: MLG 459/2009
OF AUSTRALIA
REGISTRY: MELBOURNE
JOHN HOLLAND PTY LTD
Applicant
CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION (CFMEU)
First Respondent
MARK TRAVERS
Second Respondent
FRANK O’GRADY
Third Respondent
SHAUN REARDON
Fourth Respondent
STATEMENT OF AGREED FACTS
Relief Sought
In its Amended Application filed on 11 September 2009, the Applicant seeks, inter alia:
(a)The imposition of pecuniary penalties pursuant to s.49(1)(a) of the Building and Construction Industry Improvement Act 2005 (Cth) (BCII Act) upon the First Respondent for:
(i)breach of s.38 of the BCII Act at the T2EP Site – Melbourne Airport, commencing at about 5.50am on 24 March 2009 (T2EP Site); and
(ii)breach of s.38 of the BCII Act at the Carpark Site – Melbourne Airport, commencing at about 7.15am on 24 March 2009 (Carpark Site).
(b)The imposition of pecuniary penalty against the Second to Fourth Respondents inclusive for breach of s.767 of the Workplace Relations Act 1996 (Cth) (“WR Act”) arising out of the each of their conduct engaged in on 24 March 2009;
(c)The imposition of a pecuniary penalty against the Second to Fourth Respondents inclusive for breach of s.38 of the BCII Act arising out of the each of their conduct engaged in on 24 March 2009;
(d)An order under s.841 of the WR Act that any pecuniary penalty imposed by this Honourable Court be paid to the Applicant;
(e)An order pursuant to s.49(5) of the BCII Act that any pecuniary penalty imposed by the Honourable Court be paid to the Applicant; and
(f)An award of damages to the Applicant for the loss and damage it suffered resulting from each of the Respondents’ conduct on 24 March 2009, namely:
(i)interference with contractual relations; and
(ii)inducing breach of contract.
Second Respondent’s admissions
The First Respondent admits that, by reason of the conduct of its officers, the Second to Fourth Respondents inclusive, on 24 March 2009, at each of the T2EP Site and the Carpark Site, it twice contravened s.38 of the BCII Act on that day (the Admissions).
In return for the Admissions, the Applicant agrees:
(a)to discontinue proceedings against the Second to Fourth Respondents inclusive in MLG459/2009; and
(b)that save and except for the Admissions in paragraph 2 above regarding the two breaches of s38 of the BCII Act, the Applicant no longer seeks relief as particularised in the Amended Application and summarised at clauses 1(b) to (f) above and will otherwise discontinue the proceedings against the First to Fourth Respondents in MLG459/2009.
Agreed Facts
The Applicant is and was at all material times:
(a)a body corporate capable of suing;
(b)a constitutional corporation within the meaning of the WR Act; and
(c)a building industry employer, and thereby a building industry participant, within the meaning of s.4 of the BCII Act.
The First Respondent is and was at all material times:
(a)an organisation of employees registered pursuant to the WR Act;
(b)a building association within the meaning of s.4 of the BCII Act; and
(c)an organisation as defined in section 4 of the BCII Act.
The Second Respondent is and was at all material times an officer of the First Respondent for the purposes of s.69(1)(b) of the BCII Act.
The Third Respondent is and was at all material times an officer of the First Respondent for the purposes of s.69(1)(b) of the BCII Act.
The Fourth Respondent is and was at all material times an officer of the First Respondent for the purposes of s.69(1)(b) of the BCII Act.
The Applicant has at all material times conducted the business of civil construction and engineering contractor.
The Applicant has at all material times been engaged in the completion of building and construction works at the Melbourne Airport (the Work) located in Tullamarine, Victoria (the Site). For the purposes of this application, there were two principal work areas at the Site, namely the T2EP Site and the Carpark Site.
The Work is and was at all material times “building work” within the meaning of s.5 of the BCII Act.
The Applicant engaged sub-contractors (which employed other persons) to complete the Work at the Site.
Certain persons employed by the sub-contractors engaged by the Applicant were members of the First Respondent.
The 24 March 2009 industrial action at T2EP Site at Melbourne Airport
On 24 March 2009, the Work was scheduled to commence at the T2EP Site at 7am.
There is a bus assembly area (Bus Area) within the perimeter of the T2EP Site operated and controlled by the Applicant. Persons engaged to provide services at the T2EP Site (construction workers) are regularly directed to attend the Bus Area in order to be shuttled, by bus, to other locations on various work sites within the Site.
At about 5.50am on 24 March 2009, the Second Respondent (Travers) entered upon the T2EP Site and went to the Bus Area.
At about 5.50am on 24 March 2009, the Third Respondent (O’Grady) entered upon the T2EP Site and went to the Bus Area.
At about 5.50am on 24 March 2009, the Fourth Respondent (Reardon) entered upon the T2EP Site and went to the Bus Area.
At all material times on 24 March 2009, when in attendance at, and entering upon, the T2EP Site, each of Travers, O’Grady and Reardon were acting as officers of the First Respondent, CFMEU.
In the period between 6.15am and 7am on 24 March 2009, each of Travers, O’Grady and Reardon sought to conduct a meeting, and did conduct a meeting, with persons engaged to work on the T2EP Site who were members of the First Respondent CFMEU (the T2EP Site Union Meeting).
During the T2EP Site Union Meeting, each of Travers, O’Grady and Reardon, as officers of the First Respondent, and acting on its behalf, encouraged persons engaged to perform building and construction work at the T2EP Site to refuse to perform that work on 24 March 2009.
At the conclusion of the T2EP Site Union Meeting, persons engaged to perform building and construction work at the T2EP Site on 24 March 2009 failed and/or refused to attend for work at 7am and thereafter left the T2EP Site (the T2EP Site Industrial Action).
None of the relevant construction workers who refused and/or failed to work on the T2EP Site on 24 March 2009, numbering approximately 180, were authorised by the Applicant to leave the site or desist from carrying out their usual building and construction duties on the T2EP Site.
The Applicant had not directed or authorised the employees to cease or stop work.
For the purposes of s.37 and s.38 of the BCII Act, the T2EP Site Industrial Action was unlawful industrial action.
For the purposes of s.69 of the BCII Act, the conduct of each of Travers, O’Grady and Reardon referred to at paragraphs 14 to 23 above was:
(a)conduct of an officer of the First Respondent acting in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.
In the premises, the First Respondent admits it:
(a)engaged in the 24 March 2009 T2EP Site Industrial Action; and
(b)thereby contravened s.38 of the BCII Act.
The 24 March 2009 industrial action at the Carpark Site
The Carpark Site is within the perimeter of the Site, which is in the vicinity of the Melbourne Airport.
At about 7.15am on 24 March 2009, the Applicant conducted a pre-start meeting at the lunchroom at the Carpark Site. There were approximately 100 building and construction workers in attendance at the pre-start meeting (the 100 Construction Workers). At the conclusion of this meeting, at about 7.20am, the Applicant sought to commence a toolbox meeting. Travers attended the toolbox meeting at the Carpark Site. Travers announced to the 100 Construction Workers that there would be a meeting outside [of the lunch room] in the car park area (the Travers Meeting Announcement).
After the Travers Meeting Announcement, the 100 Construction Workers left the lunchroom and proceeded to the car park area to attend a stop work meeting conducted by Travers (the Travers Meeting).
At no time before 24 March 2009 or on 24 March 2009, had the Applicant:
(a)been given notice of the Travers Meeting;
(b)authorised the Travers Meeting; and
(c)permitted any construction worker engaged to perform building and construction work on the Carpark Site to attend the Travers Meeting.
During the Travers Meeting, Travers incited, encouraged or directed the 100 Construction Workers to take unlawful industrial action, namely to cease work without authorisation on 24 March 2009.
After the Travers Meeting, approximately 92 of the 100 Construction Workers attended the lunchroom, retrieved their belongings and left the Carpark Site and did not return that day (the Carpark Site Industrial Action). The Applicant had not directed or authorised any work to stop on 24 March 2009.
For the purposes of s.37 and s.38 of the BCII Act, the Carpark Site Industrial Action was unlawful industrial action.
For the purposes of s.69 of the BCII Act, the conduct of Travers set out at paragraphs 30 to 33 above was:
(a)conduct of an officer of the First Respondent acting in that capacity; and
(b)pursuant to s.69(1)(b) of the BCII Act, conduct of the First Respondent.
In the premises, the First Respondent admits it:
(a)engaged in the Carpark Site Industrial Action; and
(b)thereby contravened s.38 of the BCII Act.
Agreed penalty
The First Respondent has agreed that pursuant to s.49(1)(a) of the BCII Act and the Admissions it makes herein, it shall pay the following sums by way of penalty:
(a)$11,500 for the contravention of s.38 of the BCII Act on 24 March 2009 by reason of the T2EP Site Industrial Action; and
(b)$11,500 for the contravention of s.38 of the BCII Act on 24 March 2009 by reason of the Carpark Site Industrial Action.
The Applicant and First Respondent have agreed that, subject to the discretion in the Court to fix an appropriate penalty, the penalty sums set out above at paragraphs 39(a) and (b) are satisfactory, appropriate and within the permissible range in all the circumstances.
Pursuant to section 49(5) of the BCII Act, the Applicant seeks an order from the Court that the First Respondent pay the penalty sums to it. The First Respondent consents to such an order.
Costs
The Applicant does not seek an order as to costs.
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