Ms Michelle Timtim v The Old Rosebud

[2023] FWC 2323

[2023] FWC 2323

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Ms Michelle Timtim
v

The Old Rosebud

(U2023/3188)

DEPUTY PRESIDENT WRIGHT SYDNEY, 11 SEPTEMBER 2023

Application for an unfair dismissal remedy - Respondent in liquidation - creditors voluntary winding up - application stayed

1. On 15 April 2023, Ms Michelle Timtim made an application to the Fair Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy, alleging that she had been unfairly dismissed from her employment with the Old Rosebud Pty Limited (Old Rosebud).

1. Ms Timtim was employed in a café business owned by the Old Rosebud and dismissed on 9 April 2023 when this business was sold to a new owner.

1. On 16 May 2023 the Old Rosebud filed a Form F3 – Employer response to unfair dismissal application in which it advised that it objected to the application. The Old Rosebud objected on the grounds that the Old Rosebud is a small business employer and that it complied with the Small Business Fair Dismissal Code, and further that the business had been sold.

1. On 17 May 2023 Ms Michelle Bloom, the director of Old Rosebud, advised the Commission that she did not wish to participate in conciliation and requested that the Commission determine the jurisdictional objections.

1. The matter was referred to me. As the Small Business Fair Dismissal Code did not appear to be relevant to the matter, and the jurisdiction objection had therefore not been properly made, I listed the matter for member assisted conciliation on 6 June 2023 and for further member assisted conciliation/directions on 20 June 2023.

2. Ms Timtim appeared on both occasions. Old Rosebud, represented by Ms Bloom, appeared on 6 June 2023 but not on 20 June 2023.  On 20 June 2023, as the matter was not resolved, I issued directions for the filing and serving of material and set the matter down for hearing/determinative conference on 7 August 2023.

1. On 4 July 2023, Ms Timtim filed and served evidence and submissions in accordance with my directions.  The Old Rosebud was required to file and serve material on 18 July 2023 but did not do so until 3 August 2023. The material filed by the Old Rosebud included a letter to creditors from Amanda Lott, Liquidator Appointed dated 26 May 2023 which advised that the Old Rosebud was in liquidation and that Ms Lott had been appointed Liquidator of the Company by a resolution of the Company’s members on 22 May 2023. This was the first occasion that the Commission was advised that the Old Rosebud is in liquidation.

1. At the conference on 7 August 2023, I advised Ms Timtim that it was likely that the matter could not proceed in light of the Old Rosebud being in liquidation. I advised Ms Timtim that I would give her 14 days to seek advice and consider whether she wished to discontinue the matter and to advise my Chambers of her decision by 21 August 2023.

1. Ms Timtim did not contact my Chambers as requested, so on 24 August 2023 my Chambers sent the following email to the parties:

Dear parties,

I refer to the above matter which was listed for hearing before Deputy President Wright on 7 August 2023.

On 3 August 2023, the Respondent provided to Chambers the attached “Initial Information for Creditors” which indicated that the Respondent is in liquidation. This email is therefore copied to Amanda Lott who is identified in the attached document as the Liquidator Appointed.

Deputy President Wright is currently considering whether section 500(2) of the Corporations Act 2001 is applicable to the above matter and if so, whether leave of the Court is required for the matter to proceed.

Section 500(2) provides:

After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes.

The parties and Ms Lott are invited to provide any documents, information and submissions which might be relevant to Deputy President Wright’s consideration of this matter no later than 4:00pm on Thursday, 7 September 2023.

1. On 28 August 2023, Ms Lott sent a letter to the Commission which included the following statements:

   I invite Michelle Lacia, the Applicant, to apply to FEG in respect of unpaid employee
   entitlements, excluding superannuation. Any unpaid superannuation is now Superannuation Guarantee Charge and the Australian Taxation Office is the proper claimant on behalf of the former employees.

   …

   Pursuant to Section 471B of the Corporations Act 2001 (Cth) the proceedings in the above mentioned matter are stayed and there is a suspension of enforcement process without the leave of the Court.

1. On 8 September 2023, the Commission undertook a company search in relation to the Old Rosebud which confirmed that Ms Lott had been appointed as Liquidator as a result of a creditors voluntary winding up on 22 May 2023.

1. My Chambers did not receive any response to the email of 24 August 2023 from Ms Timtim by 7 September 2023 so I will now determine the matter on the basis of the material before me.

1. The Commission has dealt with unfair dismissal applications on a number of occasions when the Respondent has gone into liquidation after proceedings have commenced.[1] These decisions confirm that s.500(2) of the Corporations Act 2001 (Cth) applies to a creditors’ voluntary winding up, that unfair dismissal applications are “civil proceedings” for the purpose of s.500(2), and that an unfair dismissal application against a respondent who is subject to a creditors’ voluntary winding up cannot proceed without the leave of the Court.

1. The correspondence from Ms Lott cites s.471B of the Corporations Act 2001 which is not applicable to this matter as it deals with a proceeding in a Court.[2] However, I note that the general tenor of Ms Lott’s correspondence is that Ms Timtim’s application cannot progress without the leave of the Court which is consistent with s.500(2). I also note that I have not received any material from Ms Timtim which indicates that she disagrees with Ms Lott or that otherwise asserts that she can proceed with the application.

1. In all of the circumstances, I am satisfied on the basis of all of the material before me that a creditors voluntary winding up has occurred in relation to the Old Rosebud and s.500(2) of the Corporations Act 2001 applies to the application brought by Ms Timtim. I therefore find that the application cannot proceed except by leave of the Court and subject to such terms as the Court imposes.

1. The unfair dismissal application will be stayed to allow Ms Timtim to seek leave of the Court to proceed with the application. If Ms Timtim obtains such leave, I will proceed to hear the application subject to such terms as the Court imposes. If Ms Timtim does not provide evidence within 28 days of the date of this decision that she had made an application to the Court for leave to proceed with the application, the matter will be dismissed without further hearing.

DEPUTY PRESIDENT

[1] See for example Cahill v EPM Central Coast Pty Ltd T/A Express Print and Mail[2020] FWC 219; Klemm v Penrice Soda Products Pty Ltd[2016] FWC 317.

[2] Smith and Ors v Silverwood and Beck Pty Ltd (in liquidation) (2006) 142 IR 137 at [21].

Printed by authority of the Commonwealth Government Printer

<PR766104>