Mr Juy Hepner v Fine Food Solutionz Pty Ltd
[2013] FWCFB 2060
•5 APRIL 2013
[2013] FWCFB 2060 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
v
Fine Food Solutionz Pty Ltd
(C2013/2819)
VICE PRESIDENT WATSON | |
DEPUTY PRESIDENT HARRISON | |
COMMISSIONER ROBERTS | SYDNEY, 5 APRIL 2013 |
Appeal against decision [[2013] FWC 430] of Commissioner McKenna at Sydney on 18 January 2013 in matter number U2012/8468 - appeal in relation to unfair dismissal application - discretionary decision - permission to appeal under s.400 - public interest test - Fair Work Act 2009 - ss. 388, 394, 400, 604.
Introduction
[1] This decision concerns an application for permission to appeal under s.604 of the Fair Work Act 2009 (the Act) by Mr Juy Hepner against the decision of Commissioner McKenna handed down on 18 January 2013. 1 The Commissioner dismissed Mr Hepner’s application.
[2] At the hearing on 19 March 2013 Mr Hepner appeared on his own behalf, and Mr Minehan of counsel appeared for Fine Food Solutionz Pty Ltd (Fine Food).
Background
[3] Mr Hepner was a founder and director of Fine Food, a company engaged in the manufacture and supply of Asian food products. He later resigned his directorship and became an employee of the company as part of a broader commercial arrangement. Two other directors were appointed to the company at the time, Mr Byron Kurth and Mr Nathan Catalano. Although there was some dispute regarding the nature of Mr Catalano’s role, Commissioner McKenna proceeded on the basis that he was also the Managing Director of Fine Food, and was responsible for the day-to-day operations of the company.
[4] The parties to this matter are also parties to proceedings in the Federal Court, in matters concerning the operation and control of the company. The operation and control of the company, and the conduct of Mr Catalano, formed a significant part of Mr Hepner’s dispute regarding his dismissal.
[5] Mr Catalano purported to dismiss Mr Hepner on 30 April 2012. Prior to this, on 19 April 2012, Mr Catalano sent a letter to Mr Hepner outlining areas of concern regarding his conduct and required him to attend a disciplinary meeting. The letter set out the matters to be discussed at the disciplinary meeting and notified Mr Hepner that he could have a support person present if he chose. It also listed four possible outcomes, including the termination of Mr Hepner’s employment. Mr Hepner did not respond to the letter and did not attend the meeting, although it had been rescheduled at his request.
[6] On 30 April, Mr Catalano sought to effect Mr Hepner’s dismissal by way of a second letter. In that letter, Mr Catalano noted that he made the decision to terminate Mr Hepner’s employment based on the information before him, in the absence of anything further being provided by Mr Hepner.
[7] On 28 May 2012 Mr Hepner made an unfair dismissal application after he realised that his pay had not been processed for that month. Commissioner Gay subsequently granted an extension of time for the filing of the application, as the application was filed outside of the 14 day time limit. The unfair dismissal application itself was heard by Commissioner McKenna on 10 and 11 December 2012.
[8] At the hearing before Commissioner McKenna, Mr Hepner disputed Mr Catalano’s authority as a single director of the respondent company to dismiss him. Mr Kurth supported Mr Hepner’s position. Further, Mr Hepner asserted that even if Mr Catalano had the authority to dismiss him, his conduct did not warrant dismissal. Mr Hepner submitted that he had always acted in the best interests of the respondent company, and with permission from Mr Catalano’s co-director, Mr Kurth.
The Decision Under Appeal
[9] The Commissioner said the following regarding Mr Hepner’s submission that Mr Catalano did not have the authority to effect his dismissal:
“[5] ...The question of whether Mr Catalano was properly authorised - without Mr Kurth’s concurrence - to effect the dismissal does not, it seems to me, need to be determined in these proceedings. That is, the cases advanced by the applicant and the company proceeded on the basis there was a dismissal. I do not consider it is apposite to purport to determine whether the dismissal was, for instance, void or voidable for reasons related to the dispute between the co-directors concerning scope of authority. I proceed on the basis the applicant was dismissed from his employment with the company by Mr Catalano.”
[10] The Commissioner’s conclusion to dismiss the application was primarily based on an assessment of Mr Hepner’s conduct with reference to the Small Business Fair Dismissal Code. She said:
“[19] The circumstances of this application are, as I have indicated earlier in the decision, atypical. Nonetheless, the objective evidence seems to be on common ground concerning the equipment, the establishment of GDSC and the registration of a trading name similar to that of the company - and this is so irrespective of the matters described in the applicant’s case concerning the motivating factors and the applicant’s undoubted conviction in describing such matters. It also appears to be common ground that the company gave the applicant written notice of matters of concern in advance of a meeting, being a meeting which the applicant determined not to attend. Further, the applicant determined not to provide a written response although given an opportunity to do following his advice as to providing a response by this means.
[20] Mr Catalano had corresponded with the applicant on 19 April 2012 outlining a range of concerns, convening a disciplinary hearing and advising the applicant could have a support person. Mr Catalano foreshadowed four possible outcomes in his correspondence, with the fourth being “Termination of Employment”. The applicant determined not to respond to the matters in Mr Catalano’s correspondence; he neither participated in the meeting that was rescheduled at his request nor provided a written response by the date specified. Mr Catalano then later proceeded to dismiss the applicant on the basis of the available information, being information which I accept, for the reasons described in Mr Catalano’s evidence, may be considered to constitute a valid, conduct-related reason for dismissal.
[21] It seems to me that the dismissal may be viewed as Code-compliant, considering the circumstances described in the evidence. Following from the approach in John Pinawin T/A RoseVi.Hair.Face.Body v Edwin Domingo[2012] FWAFB 1359 (albeit that decision concerned summary dismissal, whereas the applicant was given a payment in lieu of notice), the termination of the applicant’s employment was consistent with the Code and the termination thereby was not an unfair dismissal. As such, it is unnecessary to consider the other elements as to an unfair dismissal. Given my conclusion in this respect, it is also unnecessary to consider the alternative grounds relied upon in the company’s submissions concerning the termination of employment.”
Grounds of Appeal
[11] Mr Hepner filed submissions appealing Commissioner McKenna’s decision on several bases which basically came down to the following two arguments:
• Commissioner McKenna made a procedural error by not considering Mr Catalano’s authority to dismiss Mr Hepner as a single director. Commissioner McKenna erred in not considering the matters in dispute between the parties before the Federal Court, as they are relevant to the scope of Mr Catalano’s authority to dismiss Mr Hepner.
• Commissioner McKenna was incorrect to consider Mr Hepner’s dismissal was compliant with the Small Business Fair Dismissal Code;
[12] During the appeal hearing, Mr Hepner reiterated his argument that Mr Catalano did not have actual or ostensible authority to dismiss him. Mr Hepner further submitted that if Mr Catalano did have the authority to dismiss him, he considered he was acting in the best interests of the company and as such his conduct did not warrant dismissal.
[13] Mr Hepner sought the remedy of reinstatement to his prior position.
Submissions of Fine Food
[14] Fine Food submits:
• There is no public interest in granting permission to appeal;
• There are no significant errors of fact in Commissioner McKenna’s decision;
• The respondent is a small business, and the dismissal of Mr Hepner complied with the Small Business Fair Dismissal Code;
• The authority of Mr Catalano to dismiss Mr Hepner is not a matter for consideration by the Fair Work Commission.
Permission to Appeal
[15] An appeal under s.604 of the Act in an unfair dismissal matter is determined by reference to s.400 of the Act. Section 400 provides:
“400 Appeal rights
(1) Despite subsection 604(2), FWA must not grant permission to appeal from a decision made by FWA under this Part unless FWA considers that it is in the public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by FWA in relation to a matter arising under this Part can only, to the extent that it is an appeal on a question of fact, be made on the ground that the decision involved a significant error of fact.”
[16] A Full Bench in GlaxoSmithKline Australia Pty Ltd v Makin 2considered the terms of s.400. It said:
“[26] Appeals have lain on the ground that it is in the public interest that leave should be granted in the predecessors to the Act for decades. It has not been considered useful or appropriate to define the concept in other than the most general terms and we do not intend to do so. The expression ‘in the public interest’, when used in a statute, classically imports a discretionary value judgment to be made to be made by reference to undefined factual matters, confined only by the objects of the legislation in question. [Comalco v O’Connor (1995) 131 AR 657 at p.681 per Wilcox CJ & Keely J, citing O’Sullivan v Farrer (1989) 168 CLR 210]
[27] Although the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters, it seems to us that none of those elements is present in this case.”
[17] In a decision of a Full Court of the Federal Court the requirements of s.400 were described as importing a more stringent test than the previous legislation. 3 Justice Buchanan described the public interest test as a discretionary task involving a broad value judgement.4
[18] The decision subject to appeal in this matter is also a discretionary decision. 5 The appeal is therefore to be considered in accordance with the principles of House v R.6 Those principles are expressed as follows [at 504-505]:
“It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.”
[19] Section 400(2) of the Act modifies the House v R principles by limiting any review based on a mistake of fact to a significant error of fact.
[20] In our view the first ground of appeal is based on a misconception. Mr Hepner contends that Mr Catalano had no authority to dismiss him. He is critical of the Commissioner proceeding on the basis that there was a termination of employment in the extract set out above without considering whether Mr Catalano had the authority to terminate him. However, if he is correct in his contention, the consequences are that the purported termination had no legal effect, Mr Hepner’s employment is still on foot and his unfair dismissal application is similarly invalid. The Commissioner’s acceptance of the validity of the termination enabled a consideration of the fairness of Mr Catalano’s action. In the light of Mr Hepner’s position in making the unfair dismissal application and not contesting the existence of the termination, we consider that this was the proper course to take. In reaching this conclusion we should not be taken to expressing any view on the questions of authority of Mr Catalano to dismiss Mr Hepner. This question is properly considered in another jurisdiction.
[21] Given that Fine Food is a small business, a critical question in the application was whether the termination was consistent with the Small Business Fair Dismissal Code. The conduct that led to termination was considered to be a serious and multifaceted course of conduct, rather than repeated less serious transgressions that did not cease after warnings. Hence the Commissioner appeared to consider the aspect of the code regarding Summary Dismissal and effectively conclude that Mr Catalano believed on reasonable grounds that Mr Hepner’s conduct was sufficiently serious to justify summary dismissal. This involved an assessment of the reasonableness of the grounds for Mr Catalano’s belief, not a broader consideration of the fairness of his conclusions. Mr Hepner has not established that the approach of the Commissioner was in error or that the appeal otherwise attracts the public interest.
[22] For these reasons we do not consider that Mr Hepner has established a basis to grant permission to appeal. We decline to grant permission to appeal and dismiss Mr Hepner’s application for permission to appeal.
VICE PRESIDENT WATSON
Appearances:
Mr Juy Hepner, on his own behalf
Mr Michael Minehan, of counsel, for Fine Food Solutionz Pty Ltd.
Hearing details:
2013
March
19
Sydney
1 Hepner v Fine Food Solutionz [2013] FWC 430.
2 [2010] FWAFB 5343.
3 Coal and Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54 per Buchanan J at [34].
4 Coal and Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54 per Buchanan J at [44]. See also Hogan v Hinch (2011) 85 ALJR 398 and O’Sullivan v Farrer (1989) 168 CLR 210.
5 Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194.
6 (1936) 55 CLR 499.
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