Keldote Pty Ltd v Riteway Transport Pty Ltd - [2009] FMCA 319

FEDERAL MAGISTRATES COURT OF AUSTRALIA

KELDOTE PTY LTD & ORS v RITEWAY TRANSPORT PTY LTD

[2009] FMCA 319

INDUSTRIAL LAW – Unfair contracts – Independent Contractors Act 2006 – contract varied – variation having element of retrospectivity – variation should not go beyond what is necessary to remedy the unfairness identified – discretion to make no order.

COURTS & JUDGES – Independent Contractors Act 2006 – Court has jurisdiction to review contracts which are no longer on foot at the time the application for review is filed.

Independent Contractors Act 2006, ss.12, 15, 16
Industrial Relations Act 1988, ss.127A, 127B

Keldote Pty Ltd & Ors v Riteway Transport Pty Ltd [2008] FMCA 1167
Keldote Pty Ltd & Ors v Riteway Transport Pty Ltd (No.2) [2008] FMCA 1623
Re Dingjan; Ex parte Wagner (1995) 183 CLR 323
Gerrard v Mayne Nickless Ltd (1996) 135 ALR 494
Eagle Boys Dial-A-Pizza Australia Pty Ltd v Clifford (2003) 125 IR 35

Applicant:

KELDOTE PTY LTD

Respondent:

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

File Number:

SYG 2353 of 2007

Applicant:

L & D LOWE TRANSPORT PTY LTD

Respondent:

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

File Number:

SYG 2354 of 2007

Applicant:

TAMBO WATERS PTY LTD

Respondent:

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

File Number:

SYG 2431 of 2007

Judgment of:

Cameron FM

Hearing date:

31 March 2009

Date of Last Submission:

22 April 2009

Delivered at:

Sydney

Delivered on:

5 May 2009

REPRESENTATION

Counsel for the Applicant:

Mr I. Latham

Solicitors for the Applicant:

Turner Freeman

Counsel for the Respondents:

Mr A. Moses SC

Solicitors for the Respondents:

Blake Dawson

ORDERS

In respect of each applicant’s contract with Riteway Transport Pty Ltd, the fourth paragraph of clause 5 of the Riteway-TWU agreement be varied as from the time when the contract was made by inserting after the sentence ending with the words “8 years” the following words:
Where the requirement to update a vehicle results in, or is likely to result in, an increase in the Contract Driver’s operating expenses, that requirement will be subject to, and unenforceable in the absence of, agreement between the Company and the Contract Driver on a trip rate to be applicable to the use of the new vehicle.
The matters stand over for consideration of the applicants’ claims for damages and injunctions.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 2353 of 2007

KELDOTE PTY LTD

Applicant

And

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

Respondent

SYG 2354 of 2007

L & D LOWE TRANSPORT PTY LTD

Applicant

And

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

Respondent

SYG 2431 of 2007

TAMBO WATERS PTY LTD

Applicant

And

RITEWAY TRANSPORT PTY LTD T/AS RITEWAY EXPRESS

Respondent

REASONS FOR JUDGMENT

Introduction

In these proceedings for relief pursuant to the Independent Contractors Act 2006 (“ICA”) the applicants alleged that the contract which each of them held with the respondent (“Riteway”) was unfair. At this point it should be noted that each of the applicants’ contracts…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2009] FMCA 319
Decision Date: 5 May 2009

CaseChat Overview and Summary

Keldote Pty Ltd and Riteway Transport Pty Ltd were parties to a dispute that was brought before the court. The central issue was the variation of contracts between the parties, specifically the terms regarding the updating of vehicles and the impact on operating expenses. The court was required to determine whether the contracts were fair under the Independent Contractors Act 2006 and whether any retrospective variation was permissible.

The legal issues before the court included whether the court had jurisdiction to review contracts that were no longer in effect at the time the application was filed, and whether any variation of the contract terms should have a retrospective element. The court also had to consider whether any variation should go beyond what was necessary to remedy the unfairness identified and whether the discretion to make no order should be exercised.

The court found that it had jurisdiction to review the contracts, even though they were no longer in effect. The court held that any variation should not go beyond what was necessary to remedy the unfairness identified and should not have a retrospective element. The court exercised its discretion to make no order regarding the applicants' claims for damages and injunctions, and instead varied the contract terms as requested by the applicants.

The court's orders included varying the fourth paragraph of clause 5 of the Riteway-TWU agreement to insert specific words regarding the requirement to update a vehicle and the agreement on a trip rate. The matters were stood over for consideration of the applicants' claims for damages and injunctions.

Orders

Orders of the court

In respect of each applicant’s contract with Riteway Transport Pty Ltd, the fourth paragraph of clause 5 of the Riteway-TWU agreement be varied as from the time when the contract was made by inserting after the sentence ending with the words “8 years” the following words:

Where the requirement to update a vehicle results in, or is likely to result in, an increase in the Contract Driver’s operating expenses, that requirement will be subject to, and unenforceable in the absence of, agreement between the Company and the Contract Driver on a trip rate to be applicable to the use of the new vehicle.

The matters stand over for consideration of the applicants’ claims for damages and injunctions.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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