Maria Gorete Concalves Fernandez v Comgroup Supplies Pty Ltd
[1996] IRCA 38
•09 February 1996
DECISION NO: 38/96
C A T C H W O R D S
INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - review of decision of JUDICIAL REGISTRAR - APPLICATION for stay of ORDERS of the JUDICIAL REGISTRAR - appropriate test to be applied in determining a stay APPLICATION
INDUSTRIAL RELATIONS ACT 1988 Ss 170EE(1)(b)(ii), 376
Wyndham Lodge Nursing Home Inc v Cecile Reader, unreported, IRCA No. 555/95, Marshall J, 4 October 1995
Sutton & Others v Sharp & Others, unreported, IRCA No. 579/95, Wilcox CJ, 28 September 1995
The Commissioner of Taxation of the Commonwealth of Australia v The Myer Emporium Limited (1986) 160 CLR 220
Deputy Commissioner of Taxation v Fontana (1989) WAR 262
Multicoin Amusements Pty Ltd & Another v Avel Pty Ltd, unreported, Federal Court No. 165/90, Spender J, 16 March 1990
Sevenhill Holdings Pty Ltd & Others v Musovic & Others, unreported, Federal Court No. 372/92, French J, 4 June 1992
Carter v Geoff Layton & Company Pty Ltd, unreported, Federal Court No. 498/93, Cooper J, 27 July 1993
APESMA on behalf of Cross v Deniliquin Council (1995) AILR 3-112
Gibson v Bosmac Pty Ltd (1995) AILR 3-135
Scarborough v Lew's Junction Stores Pty Ltd (1963) VR 129
Kerrin v Leighton Contractors Pty Ltd(No. 2) (1986) 44 IR 246
MARIA GORETE CONCALVES FERNANDEZ -v- COMGROUP SUPPLIES PTY LTD - WI 95/1735
BEFORE: RITTER JR
PLACE: PERTH
DATE: 9 FEBRUARY 1996
IN THE INDUSTRIAL RELATIONS )
COURT OF AUSTRALIA )
WESTERN AUSTRALIA )
DISTRICT REGISTRY ) No. WI 95/1735
BETWEEN: MARIA GORETE GONCALVES
FERNANDEZ
- Applicant
AND: COMGROUP SUPPLIES PTY LTD
- Respondent
MINUTE OF ORDERS
BEFORE: RITTER JR
PLACE: PERTH
DATE: 9 FEBRUARY 1996
THE COURT ORDERS THAT:
The application for a stay of the orders made on 11 December 1995 be dismissed.
The application for a review of the powers exercised by the Judicial Registrar is adjourned to a directions hearing at 9.30 am on 15 February 1996.
NOTE: Settlement and entry of Orders is dealt with by Order 36 of the Industrial Relations Court Rules
IN THE INDUSTRIAL RELATIONS )
COURT OF AUSTRALIA )
WESTERN AUSTRALIA )
DISTRICT REGISTRY ) No. WI 95/1735
BETWEEN: MARIA GORETE GONCALVES FERNANDEZ
- Applicant
AND: COMGROUP SUPPLIES PTY LTD
- Respondent
BEFORE: RITTER JR
PLACE: PERTH
DATE: 9 FEBRUARY 1996
REASONS FOR JUDGMENT
The respondent's application on notice of motion filed 2 January 1996 seeks a review of the exercise of the power delegated to me under S376 of the Industrial Relations Act, 1988, which culminated in the orders in these proceedings made on 11 December 1995. The respondent has a right to seek such a review and this will be facilitated by the Court.
The substantive matter argued before me is an application by the respondent for a stay of the orders made by me on 11 December 1995 pending the hearing and determination of the review or until further order of the Court.
The matter first came before me on 17 January 1996. Prior to that date the respondent, in support of its motion, filed two affidavits of Mr David Greaves, the manager of the chilled foods division of the respondent. The affidavits were dated 2 January and 16 January 1996 respectively. After hearing argument on 17 January 1996, I formed the view that it would be appropriate to allow the applicant to file an affidavit in reply if she chose to do so. Accordingly, the motion was adjourned so that the applicant would have this opportunity. An order was also made permitting the respondent to file a further affidavit.
The applicant did not file any affidavit. However, the respondent filed a further affidavit, that of Mr Robert Stribling, dated 23 January 1996. Mr Stribling is an employee of the respondent's solicitors.
The basis of the respondent's application for a stay is set out in paragraph 5 of the affidavit of Mr Greaves sworn on 16 January 1996. This is that "the respondent has real concern that the sum of compensation will be greatly diminished at the time of the hearing and the applicant will not have the facility to repay such amount to the respondent, should the outcome of the review require it".
As stated by Marshall J in Wyndham Lodge Nursing Home Inc v Cecile Reader, unreported, IRCA No. 555/95, 4 October 1995 at page 4:
"It is well established that a party which applies to stay orders of a Court pending the hearing and determination of an appeal is required to show special or exceptional circumstances to justify the making of such orders. It is also required to justify 'departure from the ordinary rule that a successful litigant is entitled to the fruits of his litigation pending the determination of any appeal': The Commissioner of Taxation of the Commonwealth of Australia v The Myer Emporium Limited (1986) 160 CLR 220, 222 (per Dawson J)."
Wilcox CJ in his ex tempore judgment in Sutton & Others v Sharp & Others, unreported, IRCA No. 579/95, 28 September 1995, referred to The Myer Emporium Limited decision as giving "appropriate guidance" for the judgment the Chief Justice gave on a stay application in that case (page 3).
Although these cases relate to stays pending appeals rather than a review as in this instance, the Respondent accepted that these cases provided the appropriate basis on which to consider the stay application.
The respondent argues in this case that the financial circumstances of the applicant are such as to be special or exceptional circumstances justifying the making of a stay order.
The respondent points to the following matters in support of this proposition:-
The review is unlikely to be heard for some time.
On page 24 of my Reasons for Judgment dated 11 December 1995 I said, in the context of assessing compensation:
"There was no evidence before me that the applicant had found any other employment or earned any other remuneration since her termination. The applicant said she had not received any workers' compensation since 23 March 1995. This was not challenged by the respondent ... Also relevant is the fact that the applicant lost her job she had held for nearly two years, is now 39 years of age and because of her knee injury will find it difficult to obtain further employment".
The respondent confirmed that the applicant is not receiving any workers' compensation at present.
A land titles search indicated that the applicant is not, either individually or together with her husband, proprietor of her current place of residence, being 8 Duffield Street, Hamilton Hill.
A general search of land titles indicated that the applicant is not the proprietor of any land in the state of Western Australia.
The respondent's solicitors conducted an electoral roll search to identify whether the applicant or her husband were enrolled at an address other than the home address referred to above. The purpose of this was to ascertain whether the applicant or her husband were proprietors of property. This search did not provide any evidence that the applicant or her husband were such proprietors.
As stated earlier, no affidavit has been filed by the applicant. Mr Melville, for the applicant, submitted that I should not draw any inference from this as the onus was on the respondent to establish the basis for making a stay order. I do not entirely agree with this. I consider that I can draw the inference that the applicant is not in possession of any obvious information which would allay the concerns of the respondent.
The question remains whether there is evidence before me sufficient to order a stay on the basis submitted by the respondent. In considering this issue I am mindful of the fact that the respondent has probably done all it can in this case in presenting relevant evidence before the Court and that the applicant has not availed herself of the opportunity to file an affidavit.
There has not been a consistent expression by the Courts of the test to be applied in considering whether a successful litigant's financial circumstances are such as to justify a stay.
In The Myer Emporium Limited decision, Dawson J referred to there being "no reasonable prospect of recovering monies paid pursuant to the judgment at first instance" because of the applicant's financial state.
This principle was followed in Deputy Commissioner of Taxation v Fontana (1989) WAR 262.
In Multicoin Amusements Pty Ltd & Another v Avel Pty Ltd, unreported, Federal Court No. 165/90, Spender J, 16 March 1990, his Honour at page 6 referred to a passage of the judgment of Adam J in Scarborough v Lew's Junction Stores Pty Ltd [1963] VR 129, at 130, which included the following:-
"It has been stated that the applicant for a stay of execution should show that he will 'probably' not be able to recover from the other party the amount of judgment which he has been compelled to pay under execution, in order to satisfy the Court that a stay should be granted. I do not think that the word 'probably' has any particular merit. The test, I think, is, whether there is a real risk that the appeal would prove abortive if the applicant were not granted a stay. It does not really matter what expression is used, whether 'probably' or 'real risk'.”
In Sutton v Sharp, Wilcox CJ, after favourably quoting from the judgment of Dawson J in The Myer Emporium case, referred to there being a "concern" as to the ability of "the respondent to repay the money in the event of the appeal succeeding" (page 5). The Chief Justice indicated that if such were present, "this would be a powerful - no doubt critical - factor in favour of extending the time for compliance with the order".
Marshall J in Wyndham Lodge Nursing Home v Reader referred at page 4 to the decision of Gray J in Kerrin v Leighton Contractors Pty Ltd (No. 2) (1986) 44 IR 246. In that decision at page 248, Gray J referred to the need to be "shown that there is a likelihood of monies not being repaid by an unsuccessful respondent to an appeal". Marshall J then referred to the fact that it was not shown in the case before him that there was a "real likelihood that the respondent will not repay to the appellant any monies which she receives from it”.
French J in Sevenhill Holdings Pty Ltd & Others v Musovic & Others, unreported, Federal Court No. 372/92, 4 June 1992, at page 6, followed the principles stated by Dawson J in The Myer Emporium Ltd case.
Cooper J referred to the matter in Carter v Layton & Company Pty Ltd, unreported, Federal Court No. 498/93, 27 July 1993. At page 5, his Honour stated:-
"The applicant has submitted that the respondent before the Full Court made the statement that he has been without substantial means and without any assets beyond a car and presumably personal effects. A real property search did not disclose that the respondent owns any real property in Queensland. The submission is that if the judgment is paid there is a real risk that the money will be spent and that the respondent would be without the means to repay the same if the judgment of the Full Court is set aside. Thus, it was submitted to refuse a stay may render the applicant's appeal, if special leave is granted, nugatory. The respondent who appeared in person to resist the application, did not deny he was a person of limited means. However, there is no material is suggest that he is insolvent, that he would squander the money or that the money will be not preserved or invested in some tangible asset which would be available to repay the money in the event that the judgment of the Full Court was set aside. It does not follow that the mere absence of wealth will justify a stay of a successful litigant's right to the fruits of his or her judgment. The applicant must go further and show that satisfaction of the judgment will cause damage that is so irreversible as to effectively render any right of appeal nugatory".
Whilst these observations were made in the context of an application for a stay pending an application for special leave to appeal to the High Court, in my opinion his Honour's observations were not limited to such applications. Many of the points made by his Honour with respect to the respondent in that case, who had a judgment made in his favour for an amount in excess of $106,000, are also apposite to the applicant before this Court. That is, whilst there is evidence that the applicant has limited wealth and income there is no evidence that she is insolvent or facing insolvency, will squander the money, or that it will not be invested in an asset which would be available to repay the money. There is no evidence that the applicant is in debt.
In my opinion, I should follow the judgment of Dawson J in The Myer Emporium Ltd case so that a stay will only be granted because of a party's financial state where there is no reasonable prospect of recovering monies paid pursuant to the judgment at first instance. There is probably little, if any, difference between this test and the "real likelihood that the respondent will not repay to the appellant any monies which are received from a judgment" as referred to by Marshall J in the Wyndham Lodge Nursing Home case. In considering this test it is relevant to have regard to the matters quoted above from the judgment of Cooper J in Carter v Geoff Layton Proprietary Limited.
I do not think it sufficient that there merely be a concern or a risk that monies paid pursuant to a judgment will not be repaid if the respondent to the review is successful.
Another important matter was referred to by French J in the Sevenhill Holdings Pty Ltd case. His Honour at page 7 stated that:-
The risk that an appeal may be nugatory must be balanced against the risk of prejudice to the party who succeeded at first instance if execution of the judgment is stayed. Subsidiary to that consideration it is relevant to take into account the circumstance, where it exists, that on the findings made in the judgment and the evidence put before the Court on the stay application the financial fragility of the successful party is attributable in part or in whole to the conduct of the respondent."
To some extent, this is a relevant factor in this case. The respondent points to the applicant's lack of income in support of its submission that the applicant is financially fragile. However, this was contributed to, if not caused, by the respondent terminating the employment of the applicant, on my findings, in contravention of the Industrial Relations Act.
I am satisfied that the evidence before me establishes that there is a risk or grounds for concern that the applicant may not be able to pay to the respondent the judgment sum if the respondent is successful upon review. However, I do not think that the evidence establishes that there is no reasonable prospect of the respondent recovering the money to be paid pursuant to a judgment.
In considering the matter, I have taken into account the fact that the review of my exercise of delegated power is not an appeal as such but operates as a hearing de novo: APESMA on behalf of Cross v Deniliquin Council (1995) AILR 3-112; Gibson v Bosmac Pty Ltd (1995) AILR 3-135. Whilst the review operates in this way, I note that the respondent has not, to date, suggested that I have made any particular error of law or fact in deciding that the respondent terminated the employment of the applicant in contravention of the Act. Mr Greaves, in his affidavit sworn on 16 January 1996, refers to the fact that reinstatement should have been ordered and not compensation. Whilst this may be arguable, if a judge upon review were to come to this conclusion, the Court would be likely to order that the respondent pay to the applicant the remuneration lost because of her termination of employment, under Section 170EE(1)(b)(ii). This amount would be in excess of the compensation ordered.
I think the basis upon which a respondent seeks a review should also be taken into account in assessing a stay application. Although an unsuccessful respondent has a right to seek a review of the delegated power exercised by a judicial registrar, I think that the Court should be careful to ensure that such an application, together with an order for a stay, does not bring about an unfair delay in the applicant receiving the benefit of orders made in their favour. This is especially so where the employee's poor financial state is relied on by the employer to support a stay application and the employer has caused this financial position in part or in whole. In my opinion, care needs to be taken so as to not allow a capricious employer to effect a delay in paying compensation as ordered by filing an application for review without identifying any specific error allegedly made by a judicial registrar. I do not suggest that the respondent is an employer of this type but in my view the practice of the Court should reflect a policy which minimises the possibility of such an outcome occurring.
Having regard to all of the matters referred to in these reasons, I am not satisfied that the respondent has discharged the burden of establishing that it is appropriate to order a stay.
The respondent submitted that in the alternative it could pay the amount of the compensation order into Court into an interest bearing account pending the determination of the review. However, I am not satisfied that it is appropriate to make such an order. Whilst this would preserve the amount of compensation, such an order would still effect a delay in the applicant receiving the benefits of her successful litigation - and I have found no special or exceptional reason proved which requires the Court to order this.
The applicant will, no doubt, be advised by her solicitors as to the need to be able to pay the amount of the compensation order back to the respondent, perhaps with interest, if the respondent is successful upon review.
The application for a stay of the orders that I have made will be dismissed. The review of my exercise of delegated power will be adjourned to a directions hearing on 15 February at 9.30 am.
I certify that this and the preceding 9 pages are a true copy of the Reasons for Judgment of Judicial Registrar Ritter.
Associate
Date:
Counsel for the applicant: Mr S Melville
Solicitors for the applicant: Gibson and Gibson
Counsel for the respondent: Mr T Lucev/Ms A Colgate
Solicitors for the respondent: Freehill, Hollingdale & Page
Hearing date: 17 and 30 January 1996
Judgment date: 9 February 1996
0
3
0