Patrick Stevedores & Ors v Maritime Union of Aus
[1998] HCATrans 125
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Melbourne No M29 of 1998
B e t w e e n -
PATRICK STEVEDORES OPERATIONS NO 2 PTY LTD
First Applicant
LANG CORPORATION LTD
Second Applicant
STRANG PATRICK HOLDINGS PTY LTD
Third Applicant
NATIONAL STEVEDORING HOLDINGS PTY LTD
Fourth Applicant
PLZEN PTY LTD
Fifth Applicant
INTRAVEST PTY LTD
Sixth Applicant
CUMBERLANE HOLDINGS PTY LTD
Seventh Applicant
EQUITIUS PTY LTD
Eighth Applicant
JAMISON EQUITY LTD
Ninth Applicant
SERENADE PTY LTD
Tenth Applicant
SCARABUS PTY LTD
Eleventh Applicant
PATRICK STEVEDORES HOLDINGS PTY LTD
Twelfth Applicant
PATRICK STEVEDORES OPERATIONS PTY LTD
Thirteenth Applicant
and
MARITIME UNION OF AUSTRALIA
First Respondent
PETER BREUKERS, JAKE HAUB and KIERAN COYLE
Second Respondent
PATRICK STEVEDORES NO 1 PTY LTD (Under Administration)
Third Respondent
PATRICK STEVEDORES NO 2 PTY LTD (Under Administration)
Fourth Respondent
PATRICK STEVEDORES NO 3 PTY LTD (Under Administration)
Fifth Respondent
NATIONAL STEVEDORING TASMANIA PTY LTD (Under Administration)
Sixth Respondent
CHRISTOPHER D’ARCY CORRIGAN
Seventh Respondent
WILLIAM CLAYTON
Eighth Respondent
ROBERT DUNN
Ninth Respondent
NATIONAL FARMERS FEDERATION
Tenth Respondent
PCS OPERATIONS PTY LTD
Eleventh Respondents
PCS RESOURCES PTY LTD
Twelfth Respondent
P & C STEVEDORES PTY LTD
Thirteenth Respondent
DONALD GORDON McGAUCHIE
Fourteenth Respondent
PAUL XAVIER HOULIHAN
Fifteenth Respondent
JAMES WILLIAM FERGUSON
Sixteenth Respondent
COMMONWEALTH OF AUSTRALIA
Seventeenth Respondent
PETER KEASTON REITH
Eighteenth Respondent
Application for special leave to appeal
BRENNAN CJ
GAUDRON J
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
CALLINAN J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON MONDAY, 27 APRIL 1998, AT 10.19 AM
Copyright in the High Court of Australia
MR R.V. GYLES, QC: If your Honours please, I appear with MR J.E. MIDDLETON, QC and MR M.P. McDONALD for the applicants. (instructed by Freehill Hollingdale & Page)
MR J.W.K. BURNSIDE, QC: If your Honours please, I appear with my learned friends, MR H. BORENSTEIN, MR M. BROMBERG and MR M.G.R. GRONOW, for the first and second respondents. (instructed by Maurice Blackburn & Co)
MR P.B. MURDOCH, QC: May it please the Court, I appear with my learned friend, MR J.D. ELLIOTT, for the third, fourth, fifth and sixth respondents, which are the companies under administration. (instructed by Phillips Fox)
MR G.P. HARRIS: May it please the Court, I appear on behalf of the seventh and ninth respondents. (instructed by Blake Dawson Waldron)
MR J.D. MERRALLS, QC: May it please the Court, with my learned friends, MR J.I. FAJGENBAUM, QC and MS P.M. TATE, I appear for the eleventh, twelfth, thirteenth, fourteenth, fifteenth and sixteenth respondents. (instructed by Minter Ellison)
I wish to say something about the description of the eleventh and twelfth respondents. There is an error in as much as one of the companies for whom we appear has been named twice under different names. That is apparent from the Australian companies’ numbers of the second company referred to as the eleventh respondent and the company referred to as the twelfth respondent. What has happened is that the same company has been sued under two names. It changed its name, so we suggest that the former name, PCS Training Services Pty Ltd, be struck out and the present name, PCS Resources Pty Ltd, be substituted for it as the twelfth respondent, there remaining only one eleventh respondent.
BRENNAN CJ: There is no objection to that, I take it?
MR MERRALLS: No, your Honour.
BRENNAN CJ: Thank you. Mr Merralls, you are not appearing for the tenth respondent, the National Farmers Federation?
MR MERRALLS: No, your Honour, that is an unincorporated association. There is some doubt about its status as a party. We do not appear for it. It is no secret that the companies for whom we appear are associated in some respects with it and the individuals for whom we appear
are or were office bearers of it, but we do not in fact appear for the tenth respondent.
BRENNAN CJ: Thank you.
MR G.T. PAGONE, QC: May it please the Court, I appear with MS W.A. HARRIS for the seventeenth and eighteenth respondents. (instructed by Dunhill Madden Butler)
BRENNAN CJ: The Senior Registrar certifies that she holds a letter from Messrs Arthur Robinson Hedderwicks, solicitors for Mr Clayton, the eighth respondent, advising that the eighth respondent has been provided with a copy of the draft application in this matter. The eighth respondent has not been formally served with the application and seeks to be excused from attending the Court. The eighth respondent will abide by any orders made by the Court.
Yes, Mr Gyles. I should indicate, Mr Gyles, that although this is an application for special leave, the Court would expect that counsel would deliver themselves of a full argument so that if at the end of the day the Court should be minded to grant special leave, it would be able to proceed to a disposition of the matter without any delay. That, of course, will involve you in speaking, no doubt, for longer than the usual 20 minutes, but at the same time the Court is conscious of the limitation on its time and we would be grateful if counsel would confine themselves as closely as possible in the course of their oral arguments. I should indicate that the Court has read the written arguments of the parties and that may assist in the framing of counsel’s oral submissions.
MR GYLES: In that event, your Honours, may I leave aside, for the moment at least, the questions dealing with the interlocutory nature of the appeal, go to the questions of substance and then perhaps come back and address the interlocutory nature of the appeal.
There are, your Honours, as your Honours will have gathered from the written material, three broad areas which we say warrant the grant of special leave and, if granted, would warrant a discharge of the orders below.
The first group, your Honours, can be seen to be - or described as a question of power; that is, in principle, whether or not the relevant part of the Workplace Relations Act constitutes, in effect, a special regime to the exclusion of the general powers of the Federal Court. The second broad heading, your Honours, is the failure of the trial judge below to follow principle in framing the orders that he did, and that picks up a number of points which I will outline later, but one of them, your Honours, flows into the third major aspect, and that is the Corporations Law ramifications of what was done.
That was an aspect of the case which, in our submission, should have been taken into account and was not, at least properly, and there are at least two separate issues which turn upon it; the order 3 which was added by the Full Court itself, or the third order in the Full Court, which deals with the administration provisions, and the direction giving leave to proceed, which was granted by his Honour below.
May I return, your Honours, to the question of power. Could I commence by taking your Honours to the Workplace Relations Act 1996. The relevant parts, your Honours, is section 298 Part XA, which is entitled “Freedom of Association”. Your Honours should know, however, that Part VIA of the Act deals with termination of employment, or includes a division relating to the termination of employment. That commences with section 170CA. I will not take your Honours right through those provisions for termination of employment but it is necessary, in my submission, to have regard to them when one comes to section 298A and following. In particular ‑ ‑ ‑
KIRBY J: Is this a part of the Act that is designed to give effect to any international obligations of Australia under section 3(k)?
MR GYLES: Does your Honour speak of 298A or of the earlier provisions?
KIRBY J: The whole of Part XA, on Freedom of Association, and 298A and the provisions of 298 sequence which are in question here.
MR GYLES: Your Honour, I am not sure that there is any recital to that effect.
KIRBY J: There is a mention in section 3(k) about one of the sources of the power that is evoked by the federal Parliament being to assist to give effect to Australia’s international obligations in relation to labour standards.
MR GYLES: There is, your Honour, but I see no reference in this particular part to indicate that that is the case here.
KIRBY J: Yes.
MR GYLES: I would be subject to correction, but it is not something I recall seeing. Your Honours, returning to Division 3 of Part VIA, starting at 170CA, without taking your Honours through those provisions in detail I would take your Honours to section 170CR, which deals with orders available to the courts.
Now, in 170CR(1) the court is enabled to make various orders if it “is satisfied that an employer has contravened” the substantive sections and 170CR(6) declares that:
A court.....must not grant an injunction in respect of a proposed contravention of section 170CK.
Your Honour, that provision of 170CR makes explicit what a long line of decisions had held, that there was no power to make interim orders of reinstatement and so on in cases falling under the predecessors of this section. I will take your Honours later to one - perhaps the last of that line of authority to draw your Honours’ attention to it. Whilst, your Honours, we have that part at hand, might I also ask your Honours to go back to 170CP because 170CP(1) shows that the legislature well understood the difference between a contravention and an alleged contravention. Your Honours will see that the terms of CP, which talk about alleged contravention. To the same effect, your Honours, is 170CFA(2)(b), (3)(b) and so on.
One can conclude that there is a well-known and sensible distinction between something which is in contravention, something which threatens contravention, or proposes contravention, and something which is an alleged contravention. So there are really three concepts which one gets from these sections. With that in mind, your Honours, going to section 298, Division 3, section 298K, is the section which prohibits conduct and, for present purposes, the examination of the power question, we assume his Honour found an arguable case of breach of 298K. Let me accept that for a moment. Note, however, your Honours, that in 298K(1) the prohibition is upon:
must not, for a prohibited reason, or for reasons that include a prohibited reason, do or threaten to do any of the following.
So that a threat is a contravention. Then your Honours will come to Division 6 which deals with remedy ‑ ‑ ‑
McHUGH J: Before you leave section 298K, paragraph (c):
alter the position of the employee to the employee’s prejudice;
must go beyond, must it not, altering the legal rights of the person and include altering the position of the employee to that person’s economic prejudice.
MR GYLES: Let me assume that for the purposes of the current argument, your Honour. It may be that that is the case, but we would not - I mean, I accept that for the purposes of the current argument, your Honour. Section 298T(1):
Subject to subsection (4), an application may be made to the Court for orders under section 298U in respect of conduct in contravention of this Part.
Your Honour, our respectful submission is that you cannot read “conduct in contravention” down to mean conduct alleged to be in contravention.
GAUDRON J: Why not, because every application would start with conduct alleged to be in contravention and it would only be when a finding was made that you could say there was a contravention?
MR GYLES: Well, my submission is that if it was intended to use those words, the legislature would have done so.
GAUDRON J: Your construction would assume, would it not, that somewhere else you have to prove that a contravention occurred; that there would be no jurisdiction to entertain proceedings unless the contravention had in fact occurred.
MR GYLES: No, your Honour, with respect, an application can be made to the court for orders under U, in respect of. You can apply, as you do in all cases; final relief depends upon the finding of a cause of action or a statutory power or whatever the case may be. And section 298T(1) certainly authorises the bringing of an application for orders in the final event. What are they? Orders under U:
In respect of conduct in contravention of this Part, the Court may, if the Court considers it appropriate in all the circumstances of the case, make one or more of the following orders:
Again, your Honours, this is, with respect, a final relief provision; you cannot read this down to say it means, in respect of conduct which is alleged to be in contravention of this Part the court may make these orders. It is primarily, your Honours, a penalty provision. That would be, with respect, a non-sensical construction of it. The only feature of the provision to which attention was directed below is (e):
injunctions, (including interim injunctions), and any other orders, that the Court thinks necessary to stop the conduct or remedy its effects:
Now, if I could ask your Honours to note a couple of things about that provision. First of all, the grant of an interim injunction power after contravention approved, bearing in mind contravention includes threat, is a perfectly sensible and beneficial power to have. There may be many situations in which an urgent finding of threat is made and the court wishes to take further evidence about the final order.
McHUGH J: Is “interim injunction” used in paragraph (e) in its technical sense in contradistinction to “interlocutory injunction”?
MR GYLES: I would submit so, your Honour. I would submit so and when we come by a comparison to look at section 80 of the Trade Practices Act, which I have chosen as something which might be useful to examine, you see that form of words used in that case or a form of words which is ‑ ‑ ‑
McHUGH J: Interim injunctions are usually issued restraining or ordering something to be done until a specified date.
MR GYLES: Correct.
McHUGH J: Interlocutory injunctions until a final hearing.
MR GYLES: Until a final hearing, yes. Your Honour, we submit that it is a perfectly beneficial grant of power, bearing in mind that our primary argument here, your Honours, is that this is a special regime, it is a statutory power, and, therefore, it is useful to have the court in a position where, having found contravention, it does not have to immediately go to make up its mind about final orders. It can make an interim injunction to hold the position whilst those final orders are contemplated, bearing in mind, as I have said, this is primarily, at least, a penalty provision.
GAUDRON J: Does that mean that on your argument that you could have an injunction if there were a threat but not if there was the actual carrying out of the conduct?
MR GYLES: No, your Honour. No, I mean, you must find the threat and you must find the actual contravening conduct. Once either is found, then that 398U jurisdiction exists or is enlivened. Now, your Honour, the other things about (e) ‑ ‑ ‑
BRENNAN CJ: That is a rather difficult argument to raise in relation to paragraph (e), is it not, because there may be no effects of a threat? The effects may be of that which is to be done pursuant to the threat.
MR GYLES: Your Honour, I would have thought, with respect, that is in my favour. I mean, if you have a threat and you have found the threat, the best thing to do may be to grant an interim injunction before deciding what ultimately should be done about it and bear in mind, your Honours, of course, these provisions apply not just to threats, but to contraventions and it would be very sensible, as I have said, to have an interim injunction provision there.
BRENNAN CJ: Take, for example, the clearest instance of a breach, say, of 298K(1)(a) to dismiss an employee. An employer says to the employee, “I am going to dismiss you this afternoon for a prohibited reason.” How does 298U(e) cover that situation, if the employee rushes off immediately to the Federal Court?
MR GYLES: The Federal Court would then have the earliest hearing as to whether there was a contravention and, if there was a contravention, then there would be a range of possibilities ‑ ‑ ‑
BRENNAN CJ: Let us assume it was able to find immediately exactly what had happened. How would (e) cover it?
MR GYLES: Your Honour, it covers it precisely because the contravention has been proven.
BRENNAN CJ: Then what order is it that it makes?
MR GYLES: It can order reinstatement under (b).
BRENNAN CJ: But it would not be reinstatement. This is before the actual sacking.
MR GYLES: It would make a final injunction presumably.
BRENNAN CJ: How?
GUMMOW J: It would make an order under (d), would it not?
MR GYLES: I mean, it could penalise under (a) or all of the foregoing presumably.
BRENNAN CJ: It could not so far as (e) is concerned, looking at (e), it would not be stopping the conduct because the conduct in question would be the threat - it is over and done. The threat itself does not produce the dismissal, therefore, there is no effects. So (e) would be useless, is that right?
MR GYLES: No, your Honour. I do not, with respect, follow. If you have got a threat to dismiss and you find the threat before the dismissal takes places, is that not par excellence a case for an order under (e) that you shall not dismiss?
McHUGH J: But what about (d):
an order requiring the person or industrial association not to carry out a threat - - -
MR GYLES: Quite, your Honour.
BRENNAN CJ: That I understand, because it seems to me that (d) is the one that covers it. (e) does not, is that right?
MR GYLES: No, I do not accept that, your Honour, with respect.
BRENNAN CJ: Because the threat is the relevant conduct, not the dismissal and, if the threat is the relevant conduct, it has been complete, so you cannot stop it. It has had no effect in itself; it will be the dismissal that has the effect so, therefore, there is nothing to justify an order in relation to remedying effect. So, (e), therefore, does not apply; (d) is the only one.
MR GYLES: Your Honour, can I just, before going on - your Honour, it may be that, under the circumstances, a quia timet order, in effect - that that breach having been proven - as with section 80 of the Trade Practices Act, what is done - what can be done, on occasion, is to order, under section 80, that contravention (a) having taken place, there be an injunction to restrain further breaches. Now, that would be work for (e) to do. But, your Honour, if (e) does not apply in a threat situation, (d) does, and so does (a), and so does (f). So the fact that, even if your Honour is, with respect, correct in that, contrary to our submission, then we say rhetorically that does not assist very much because here we have not - the fact that there are appropriate paragraphs does not mean you read down or draw any conclusions to that in relation to (e).
McHUGH: It may be under (e) you can only stop the threat, as opposed to the dismissal.
MR GYLES: That is the point his Honour the Chief Justice is putting to me, and I accept that that may well be so. But that does not mean you may not make, perhaps, a quia timet injunction to stop a repetition of the threat.
GAUDRON J: Under what paragraph?
MR GYLES: (e) or (f).
CALLINAN J: The threat to dismiss somebody might be productive of other harm or damage.
MR GYLES: Yes.
CALLINAN J: It may be designed, really, to induce men to work longer hours, or to reduce their remuneration, and that is an effect that could be remedied under the general power.
MR GYLES: Indeed, your Honour. Could I just draw your Honours’ attention to one other matter about (e), and the wording of (e)? Does it not assume, or I submit it assumes, that the conduct must have been found to contravene.
GAUDRON J: But if you say a quia timet, that is not necessarily consistent.
MR GYLES: Well, it is, your Honour, because what I am saying is that if you have found a threat - this is the case that has been put to me: if you found a threat, that may provide an appropriate basis for an order that there be an injunction to stop further threats of that character to that employee and, in that sense only, is it quia timet. The other thing about subsection (e) that I would again put to your Honours is this; you cannot read “conduct” in (e) as anything other than contravening conduct. It cannot mean alleged conduct. We also submit that the words “remedy its effects” assume that the conduct has occurred and that there are effects which have been occasioned by it.
GUMMOW J: And it has to be conduct of the employer.
MR GYLES: Of the employer. Your Honour, so far as that is concerned, that was found in our favour by the court below, the Full Court, and there is no notice of application for cross-appeal on that issue. So that we submit that the result - we submit two things. The first is that Division 6 is, evidently on its face, the method of remedying breaches of this part of the Act, and that the words of this Court in Thomson’s Case are absolutely applicable, of which I will remind your Honours in a moment. So we say it is a special provision which would oust the general jurisdiction of the Court.
GAUDRON J: Mr Gyles, can I take you back a step. Although it may be that paragraph (e) does refer to the conduct of the employer, “remedy its effects”, the power to “remedy its effects” would seem to extend much wider than the employer. I mean, subject, of course, to observance of the judicial process.
MR GYLES: Not in our submission, your Honour.
GAUDRON J: I mean, what do you have for reading down or “remedy its effects”?
MR GYLES: Because, your Honour, the whole part relates only to employer/employee relations and, indeed ‑ ‑ ‑
GAUDRON J: Once you say it relates to employer/employee relations, you do not necessarily confine it to employer and employee, as the facts of this case show.
MR GYLES: In our submission, one would, absent some special statutory power. Your Honours, may I make it clear that the submission, or that point, is not one which is to the contrary of my basic submission. Even if that was so, it would not alter what I am now putting, namely, that this is a special provision which allows no room for the operation of section 23 of the Federal Court Act. Secondly - and I will have to come to that, your Honours, to make the submission good, but that is where we are going with, in our submission. Secondly, your Honours, that the lacuna argument really has no place where one is dealing with an express statutory provision. Here, the legislature has decided that these shall be the remedies which will be afforded in this particular instance. Not at all surprising that they do not include any quia timet relief from the ordinary interlocutory sense because of the nature of the subject matter and, by a parody of reasoning, with the long principles which govern dismissals.
KIRBY J: Is there anything in the history of this legislation that lends strength to your argument, or is there any change in this part of the Act that is relevant?
MR GYLES: This part of the Act, your Honour, is newly constructed. Features of it come from previous Acts but there is no equivalent of Part XA with its particular objects which is freedom of association, ironically enough. May I also make it clear that whilst the argument has focused on threat in relation to (e), your Honours will appreciate that my submission says that (e) operates and would operate immediately upon a finding of contravention by actual contravening conduct. The power to make an interim injunction would arise prior to the formulation of final relief. It almost certainly would be a two‑stage process. It is a penalty provision, apart from anything else, and a provision which involves reinstatement as a possibility, so there may be very good reasons for not immediately making a decision but wishing to hold the position in the meantime.
KIRBY J: You say it is natural, but it does seem curious if it can be established that, first of all, the Parliament has enacted this very important principle that you cannot sack people because of union membership, and then it is provided that the court may make orders in the nature of injunction. It does not seem natural that if you have a threatened action that you cannot intervene; you have to wait until it comes to fruit.
MR GYLES: Your Honour, this is, with respect, a penalty provision and other remedial provisions as well.
KIRBY J: I take the point of your statutory construction. I am merely responding to your suggestion that it is natural. It does not seem natural to me that you have to wait until awful things happen before courts can give relief. It may be that that is what the Act requires.
MR GYLES: I am just putting, your Honour, that this is not a ridiculous position. After all, you are providing prohibited offences and you are saying this is how it will be remedied. The court is given a considerable armoury of powers to deal with a contravention which has been found but, your Honour, with something which is quasi‑criminal, it is hardly surprising that there be the need to find contravention before you act.
GUMMOW J: Yes, but (a) has extra factors in it, does it not, that are not in (b), (c) or (d). (a) operates where there is conduct which “contravened or is contravening”. Those factors are not in the other subparagraphs.
MR GYLES: Reinstatement would assume dismissal.
GUMMOW J: But (a) cannot apply in a pure quia timet situation on its terms.
MR GYLES: No, it cannot; it is impossible.
KIRBY J: But does that not then force to the suggestion that where Parliament meant it to be something that is, as it were, fully established and complete, that it has used the past participle “contravened”, whereas that is not used in (e).
MR GYLES: Your Honour, 298T and 298U are premised by the description “conduct in contravention of this Part.”
GAUDRON J: How does 298V fit in? That may operate, on one reading at least, to presume a contravention once an application and allegation are made.
MR GYLES: On the contrary, your Honour, we submit that it assumes that there has been a dismissal of the employee or a dismissal of the ‑ ‑ ‑
GAUDRON J: A threat or some action to their prejudice?
MR GYLES: B, your Honour?
GAUDRON J: V. 298V is a presumption in proceedings under that division.
MR GYLES: Yes, your Honour.
GAUDRON J: It seems the presumption arises when an application is made and an allegation is made. If the allegation is made, there would then be a presumed contravention, on one reading at least, which ‑ ‑ ‑
MR GYLES: 298V, your Honour, only operates at the point of hearing.
GAUDRON J: Well, I do not see why. In terms it does not and it may be that it is that that presumes a contravention and thus, even if you are correct in your construction of 298U, there is a presumption in operation and the orders may be made.
MR GYLES: Well, your Honours, 298V we use in another way. Section 298V may make it very easy to have a quick hearing. It is a very unusual provision, which works very much against the employer or not necessarily - the party alleged to be guilty of the offending conduct.
KIRBY J: A quick hearing was not really possible in this case if you read the judgment of Justice North who said that, from your side, it would take months and months. December was the Commonwealth’s prediction.
MR GYLES: The Commonwealth said that your Honour. But this is a very special case, your Honour. I mean, we are assuming for the purposes of argument that this is a 298 case. Now, if it is, it is a very unusually 298 case.
McHUGH J: But sooner or later you have to come to grips with the conspiracy issue, have you not?
MR GYLES: Yes, quite, your Honour, I do and I will, but may I first submit, as I have, that Division 6 is to be construed as I would construe it. Now, your Honours, may I remind your Honours of some authorities. The first to which I refer your Honours is the latest decision which looks at the question of interim relief. It is CFMEU v Gordonstone Coal Management Pty Ltd 149 ALR 296, your Honours.
BRENNAN CJ: That is in tab 3, is it?
MR GYLES: Yes, your Honour.
BRENNAN CJ: I think it is empty.
MR GYLES: I think the instruction we received was that any Commonwealth Law Reports or Australian Law Reports would be provided.
BRENNAN CJ: Yes, all right.
MR GYLES: Your Honours, the point which arose in that case was that:
The applicant sought an interlocutory order restraining the respondent employer from contravening a clause of an enterprise agreement which was certified under the Industrial Relations Act 1988.
The respondent contended that the court did not have jurisdiction to grant the remedy sought even if a contravention of the certified agreement was established.
Now, your Honours, his Honour at 297 line 30 said:
But a preliminary point has been argued - whether, even if a contravention of the certified agreement has been established, the court has jurisdiction to grant the remedy sought. The respondent, in submitting that the court does not have such jurisdiction, relies on a line of authorities in which no breach appears. I take, as the starting point, the decision of Pincus J in Australasian Meat Industry Employees’ Union v Frugalis Pty Ltd (1987). There, his Honour held, with some regret, that the legislative history of the Conciliation and Arbitration Act 1904 required him to conclude, despite the literal terms of a grant of injunctive power by s 109(1)(b), read in combination with s 122, that the court lacked jurisdiction to restrain a breach of an order of the Conciliation and Arbitration Commission. This decision was followed by Gray J in The Queen in Right of the State of Victoria v Australian Teachers Union, where his Honour made clear his view that “the reintroduction of the use of injunctions to restrain breaches of awards” would circumvent “a specific code designed to deal with such breaches”. He considered that the repetition in the Industrial Relations Act, when it was enacted in 1988, of provisions similar to those of the earlier Act construed by Pincus J, “demonstrate[d] the intention of parliament that the remedy of injunction should continue to be unavailable in respect of breaches of awards”. An argument that s 23.....supplied the power otherwise lacking was rejected. This argument is also refuted by several other authorities: Dunham v Randwick Imaging -
which was a case of wrongful dismissal, although the question is complicated by the terms of 170EH of the Industrial Relations Act and a number of other authorities are there set out including, your Honours will see Thomson in this Court and Jackson in this Court.
As Wilson and Dawson JJ said in the lastmentioned case “the power given by s 23 is expressly limited to the making of orders in relation to matters in which the court has jurisdiction and it does not extend the jurisdiction of the Federal Court”.
The line of authority to which I have referred ends in Wattyl Ltd v Australian Liquor, Hospitality and Miscellaneous Workers Union (1995). In that case, Madgwick J, sitting in the Industrial Relations Court of Australia, dismissed an application for interlocutory injunctions to compel compliance with certified agreements. The Industrial Relations Act then conferred jurisdiction on the court by s 412(1)(a) in terms which remain unchanged in the same section of the Workplace Relations Act:
The Court has jurisdiction with respect to matters arising under this Act in relation to which:
(a) applications may be made to it under this Act ...
Section 23 of the Federal Court of Australia Act was also in force.
His Honour went on to reject the notion that section 23 could be called in aid.
His Honour then looks at 178 of the Workplace Relations Act itself, and says, at page 299 line 28:
These provisions substantially mirror (with a few amendments) the terms of s 178 of the Industrial Relations Act.
and his Honour draws attention to the differences:
In my opinion, s 178 does not assist the applicant. On the contrary, it is an example of a special statutory mode of enforcement, not only of awards and orders made under the Act, but also of the special statutory species of agreement, created by the legislation and conferring new rights, known as a certified agreement. Long ago, in Josephson v Walker (1914) 18 CLR 691 at 701, Isaacs J said:
Prima face, where the same statute creates a new right and specifies the remedy, that remedy is exclusive. The natural presumption to begin with is that parliament in creating the novel right attaches to it - - -
McHUGH J: Mr Gyles, the case is a long way removed from 298U, is it not? It may give you some assistance in relation to section 23 but it is just ‑ ‑ ‑
MR GYLES: Well, that is an integral part of my case, your Honour. There are two limbs to it, your Honour; the Wattle Case - Wattle and Dunham and others deal with reinstatement provisions, your Honour. They say no interim reinstatement, no interim orders in relation to wrongful dismissal. They are directly, we submit, in point as a matter of policy, if you like. It is not surprising the result should follow. The case is important in showing there is a consistent line of authority which says section 23 does not come into play in filling what people may see as gaps in the statutory regime under these Acts. Indeed, this was a case upon this very Act - or the section of this very Act.
BRENNAN CJ: But all you are saying is that 23 does not flesh out or extend the statutory remedies that are provided by 298U.
MR GYLES: Yes, your Honour.
BRENNAN CJ: The real point that you have to address, which you have addressed, of course, is the question of the scope of the remedies provided by 298U.
MR GYLES: That is so, your Honour.
GAUDRON J: Well, I would have thought there was another question, Mr Gyles, I am sorry, and that is whether section 23(e), as I would have thought it did, and I would have thought was implicit in Jackson v Sterling Industries, gives the Federal Court power to make orders of a kind that it considers necessary, or that might reasonably be thought necessary to enable it to completely exercise its jurisdiction and powers. So that, for example, you have Mareva injunctions, albeit that, perhaps in relation to specific cases in which there is provision for specific statutory remedies, and also Anton Pillar orders, where the point of the order is to ensure that the jurisdiction, and, perhaps also the statutory powers, are defeated.
MR GYLES: Well, your Honour, that, if I may say so, with respect, puts the issue, that last statement. Section 23 would - - -
GAUDRON J: And I mention in relation, if I could just say, to Anton Pillar orders, of course, such orders go, as I understand it, to persons who are not even parties to the proceedings.
MR GYLES: Well, Anton Pillar orders are a special case, because they are class of discovery before action, as I recollect it, your Honour.
GAUDRON J: Yes, but they would come under section 23, would they not?
MR GYLES: Well, they might, your Honour, but could I deal with the point in this way: the lines of cases to which I have just referred, and some I will refer, establish the proposition, we would submit, that where you have a statutory special regime, you do not flesh out the statutory remedies, or do anything to give extra or ancillary effect to them. You can only have the remedies which you are given, and you cannot supplement them. You cannot, putting it bluntly, do what the legislature did not do.
KIRBY J: Now, that point was considered very recently by the Court in SCI Operations (1998) HCA 20, handed down a month ago, and it may give some support to your proposition. That was relating to whether the Federal Court could award interest over and above a statutory regime under the Customs Act, and the Court unanimously said no.
MR GYLES: If your Honour pleases. Certainly we have not got that case on the list, your Honours. What we do have on our list is the relatively recent case of Downey v Transwaste 172 CLR 169. That I might hasten to say is not a case under section 23, but it makes the point, your Honours, that we are - it is support for our basic proposition. It was a case under the Industrial Relations Act of Victoria and there was what might be called a wrongful dismissal series of provisions and there were also the more general dispute resolving provisions.
The applicant before the relevant board was too late under the wrongful dismissal provisions. So what happened was that the general dispute resolving provisions were utilised and the dispute arising out of his dismissal was dealt with and resolved. What this Court said was that that cannot be done, that there was a special series of provisions dealing with wrongful dismissal and, in those circumstances, if you have not complied with those provisions, then you cannot resort to the general powers and, if your Honours go the joint judgment at 171 point 5 to 172 point 4 your Honours will, with respect, find a compelling analysis of that point and Justice Dawson, your Honours, to the same effect at 180 point 10 to 183 point 5. May I remind your Honours of Thomson Case itself 148 CLR 150.
GUMMOW J: That concerns final relief, of course.
MR GYLES: Yes, your Honour, it does, but for the present point that does not matter, I would submit. Page 162, your Honours, point 6:
A final answer to the Commission’s argument on this point is that s.80 proceeds upon the footing that it constitutes the Federal Court’s exclusive charter to grant injunctions restraining, or relating to, contraventions of the Trade Practices Act. In various sub‑sections of s.80 references are made to injunctions granted “under” the section or a particular sub‑section and to applications for injunctions “granted” under the section or a sub‑section -
and they are then set out:
Section 80 makes special provision in several respects for the grant of injunctions under the section - see sub‑ss. (4), (5) and (6). It is scarcely to be supposed that the Parliament intended to draw a distinction in these respects between two classes of injunctions, one class of injunctions granted under s. 80 and another class granted under ss. 22 or 23 of the Federal Court of Australia Act. The inference is irresistible that Parliament looked upon s. 80 as a complete and comprehensive statement of the circumstances in which injunctions might be granted in respect of relief sought under the Trade Practices Act.
GUMMOW J: You rely on page 161 as well, do you not, where there is a treatment of section 23?
MR GYLES: Yes, sorry, your Honour. There is a reference to section - the discussion really starts with 161, the argument being that 22 and 23 would apply. Your Honours, the reference to section 80 is, in my submission, illuminating. May I had to your Honours - I am sorry they were not provided earlier - with a copy of that section. Your Honours will see that section - the section has changed over the years, of course, but section 80(1) is the primary provision. Let me take, relatively, what it says:
where, on the application of the Commission or any other person, the Court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute:
(a) a contravention of a provision -
which is rather similar in concept to the present one, which is conduct contravening or threatening to contravene -
a contravention of a provision.....the Court may grant an injunction in such terms as the Court determines to be appropriate.
Your Honours, if at the end of (1) the words were “may grant an injunction (including an interim injunction)” then one would have a precise analogy with the present section. In my submission, it would be plain that that injunction power including interim injunctions, would be premised upon a finding of contravention or proposal to contravene.
GAUDRON J: It does not, however, have a deeming provision or a presumption provision.
MR GYLES: Your Honour, what it does have is subsection (2).
GUMMOW J: And subsection (4).
MR GYLES: And subsection (4). And, your Honour, (2) is particularly significant in that analysis, that:
Where in the opinion of the Court it is desirable to do so, the Court may grant an interim injunction pending determination of an application under subsection (1).
When I answered Justice McHugh earlier, I said this Act has words which cannot be mistaken; they relate to an injunction holding the position whilst the application itself is heard. If it were not for subsection (2), your Honours, it would be plain, in my submission, that you could not do that and that section 23 could not be utilised to supplement. Indeed, your Honours, in our written outline we refer to, in paragraph 5, Mr Justice Woodward in Visy Board (1984) ATPR 40-435 at 45008. This is back in 1984 - said:
In the event the TPC sought only discontinuance, no doubt because section 80(1) of the TP Act did not permit a consent judgment unless the court could be satisfied that the facts -
that should be, your Honours -
justifying it had been established - and this was not possible without an extensive hearing.
Your Honours, it is because of that question that section 80(1AA) was inserted, which enables a consent injunction to be made or granted whether or not the Court is satisfied about the contravention, because absent 80(1AA) there was no power to do that. In other words, before you get a consent injunction the judge would have to be satisfied of the jurisdictional fact. A number of your Honours will recall that in - and it may be the same interstate - in Testators Family Maintenance Act applications, you could not get a consent order from the court; you had to satisfy the judge that the testator had left the applicant without means of support. Once that was established then, in effect, the judge would listen to an argument that the appropriate order should be X or Y.
MR GYLES: In other words, it is a perfectly ordinary situation where a statutory power is given conditioned upon facts existing, found to exist. Your Honours, section 76 of the Act is not before your Honours, but it has the same requirement and in the Allied Mills Case, to which I refer in paragraph 6 of our written outline, that is, TPC v Allied Mills (1981) ATPR 40,241 at 43,181, and this was a penalty matter, his Honour said:
I must therefore be satisfied that the fourth respondent is in breach of the Act -
before imposing a penalty. Now, your Honours, also in paragraph 8 of our written outline, we refer to cases in which justices of the Federal Court have held that precisely the same thing applies under section 87(1)(A) of the Act, where it is the same scheme. In section 87 the cause of action does not arise until the breach is found. So that what we are putting, your Honours, is, with respect, in no sense unconventional or nor does it cause any concern. The tendency of some judges is to say, if there is something happening I do not like, and it is ultimately to be stopped, then I think I should be able to stop it now, and if I cannot find the power in the statute I will find it elsewhere. Well, in our respectful submission, your Honour, that cannot be done, that is, to substitute the individual view of the judge for that of Parliament.
KIRBY J: Well, it is true that ultimately you have got to look for the source of power and work out the scheme of the Act and what it requires, but you withdraw the word “natural”, but it is not unnatural if you have a high policy, adopted by the Parliament, about not dismissing people for their union membership and the judge comes to a conclusion of that by a process as is what has happened here, that the judge should have some remedies and that Parliament should have intended that there be remedies. I mean, you took the word “natural” out, but I think it is not an unnatural conclusion to reach.
MR GYLES: Natural or unnatural, your Honour, it must yield to statutory intention and we submit that this is one of those cases.
KIRBY J: But perhaps it is a reason for examining the statutory intention or the meaning of the statute very carefully against the proposition that it does not provide a remedy in such case, because ordinarily one would expect that the Parliament would provide a remedy.
MR GYLES: I submit your Honour would not start with that proposition at all. I have endeavoured to show your Honour, through a long series of decisions, that interlocutory relief is not granted in this type of case.
KIRBY J: What is the policy of the scheme of the legislation you say is behind that differentiation?
MR GYLES: Well, because, your Honour, it is a provision which remedies and punishes, and it just provides a code and - it may be, your Honour, very common for judges dealing with equitable principles to step in and become involved in prejudgment. In the area of industrial relations, your Honour, that is, it is fraught with danger and, we submit, the policy of the various Acts has not been to encourage that. Notwithstanding, your Honours, that at various stages there have been injunctive powers in the Act, the courts have been very clear that you should not let those interfere, even when the court itself has given them, with the special provisions which deal with- - -
McHUGH J: The opening words of 298U give some support - maybe a lot of support - to your argument because they commence:
In respect of conduct in contravention of this Part, the Court may.....make one or more of the following orders -
So it rather assumes that you cannot make orders until it is established that there is “conduct in contravention of this Part”.
MR GYLES: Yes, your Honour, and T is the governing section. It has precisely the same words. We say, with respect, the Full Court below said not a word about that. Our argument starts at that point; that is our key argument. The court below said not a word about how you construe “in respect of conduct in contravention of this Part”, which is the critical question of statutory construction.
GAUDRON J: Would you not construe it by reference to the presumption in 298V, at least by reference to the presumption?
MR GYLES: I submit, your Honour, that the presumption assists at the hearing in coming to the conclusion and may, as I have said, facilitate quick - and it can only be when you come to decide - perhaps I will put it this way more carefully, your Honour. If V is looked at, the presumption can only be a presumption which would lead to a finding of contravention. If it is not that, it is nothing.
GAUDRON J: Well, I do not know; it could well - so you can make a finding of contravention, I would have thought, which stands unless and until it is proved otherwise.
MR GYLES: I would submit not, your Honour. I would submit that a provision of that sort cannot operate in an interlocutory way in that sense. You cannot have chopping and changing.
HAYNE J: V goes only to presume one of the elements of the contravention, does it not?
MR GYLES: Yes, quite.
HAYNE J: It does not presume that the conduct bears the character described in 298K(c), the alteration to prejudice.
GAUDRON J: Well, that is not in ‑ ‑ ‑
MR GYLES: And your Honours can readily see why that would be so because that is a subjective matter.
GAUDRON J: But is there any issue about that in this case?
MR GYLES: About what, your Honour?
GAUDRON J: That the position of the employees has been altered to their prejudice?
MR GYLES: Yes, your Honour, but I mean for purposes of argument ‑ ‑ ‑
GAUDRON J: Forget the purpose. Is there any dispute as to that?
MR GYLES: Indeed, your Honour, but we are accepting for this argument arguable case.
GAUDRON J: Sorry, for the purposes ‑ ‑ ‑
MR GYLES: For the purposes of this argument we are accepting arguable case. There will be a very significant issue at the trial about that but the whole question of indirect effect is, to say the least, very, very arguable. But V, your Honours, is rather like section 51A of the Trade Practices Act which has a statutory presumption, and this is the same. Nobody has ever suggested that you could have an interim finding based on 51A. We submit here the purpose that 298V fills, it deals with a subjective element which the wronged party, or the party who alleges he or she has been wronged, may not be able to know. The legislature said in relation to that particular component you have this presumption, but it does not presume contravening conduct.
Your Honours, we respectfully submit that your Honours will bear in mind in relation to this argument also the decision of this Court in Jackson v Sterling Industries. I do not stop to read passages to your Honours but I respectfully submit that that case supports the proposition that section 23 is not a roving charter to fill any gap which the Court thinks should be filled. So that the end result of this argument is that it is not sufficient to make orders under 298U(e) that there is an arguable case of contravention. Contravention must be found. There is no question but that this was an important aspect of the reasoning of the judge below, that he, the judge below, relied upon this as a principal foundation for his finding. I have just lost my flag on that but I will give your Honours the reference to it in a moment. With respect, the way the Full Court dealt with the matter did not come to grips with the question.
Your Honours, the next significance of the argument is in relation to the conspiracy point. Now, we argue that you cannot have a conspiracy charging 298 as the unlawful means and we have referred to some authorities, particularly Pancontinental Mining v Posgold Investments. The Full Court dealt with that argument by saying these were cases where the crime itself was a combination and you cannot plead conspiracy and undoubtedly, your Honours, there is a strand to that effect and whilst, in my submission, Pancontinental Mining cannot be explained on that basis, I accept on an interlocutory footing that there is a question about this.
Pancontinental 121 ALR 405 was not such a case because the conspiracy, your Honours, as pleaded is at 407 and it is said that, if your Honours look at paragraphs numbered (7), (8) and (9), it will be seen that there is said there was an agreement which was unlawful by virtue of provisions, particularly 615, which said “a person shall not acquire shares in a company” et cetera. Now, your Honours, 615 is a provision which makes unlawful what a person does individually. It is not a combination crime or a combination offence. What his Honour did in relation to that - and perhaps the headnote will suffice for this purpose:
Where a statute made unlawful what was lawful before and appointed a specific remedy, that remedy and no other must be pursued.
And his Honour struck out those pleadings. Now, I, your Honours, for present purposes concede there is a question as to whether or not that is correct. We submit it is, but I can see, with respect, there is some force in the argument on the other side, but what we do gain from this analysis, your Honours, is this: if one is left with a conspiracy to do what is unlawful under 298K and that is the sole foundation of interlocutory relief, then one would need a very different consideration of it than was afforded by his Honour or the court below because undoubtedly the principal focus was on 298E and section 23, not on the conspiracy, although I concede, of course, that there was that finding.
Now, your Honours, the importance of - the trial judge at page 10 of his judgment completed his examination of serious question to be tried or the 298K section by point 9 of the page:
The court has power to make orders to remedy the effects of conduct in breach of 298K(1) which is (e) serious question to be tried -
et cetera, and your Honours will see that his Honour actually used not the interim injunction power, but the remedy effects power which, we submit, is plainly not on any view something that was open to him and it is right to say that the Full Court in their consideration of the matter saw the statute as being at the heart of the case. The argument flows through to conspiracy in this way, your Honours: if our basic point is right and there is no interlocutory relief available in relation to Division 6 of 298, it would be anomalous in the extreme if you could get interlocutory relief for a common law conspiracy, one element of which was breach of 298.
McHUGH J: Why should that be so? It is a conspiracy to injure. That is the common law cause of action, and breach of the section is the means by which it is employed, and the type of injury involved may go well beyond what is involved in 298K. For example, supposing two people, an employer and somebody else, agreed to dismiss somebody in breach of 298K so that that would cut off the employee’s earnings, which would prevent the employee engaging in some business transaction. In that situation, why could you not use the power conferred by section 23 to make interlocutory orders of a kind that you could not make if you were simply relying on 298K?
MR GYLES: Well, your Honour, what I put was, it would be anomalous if you could do, by a charge in conspiracy which it cannot do directly under the special statutory regime. That does not mean it is not - - -
McHUGH J: I do not see that at all. It is different damage. It is different damage, Mr Gyles.
BRENNAN CJ: And different parties. It is the combination, it is said, which makes conspiracy significant.
MR GYLES: Your Honour, all I am putting, as a starting point - not the end point - I understand what your Honours are putting to me. My starting point is if what is charged is effectively the same as the breach of 298, which is this case, I would submit, it would be anomalous to have interlocutory relief in relation to that conspiracy because interlocutory relief is not available for the principal offence. I am not suggesting it would be impossible, your Honours; it would be a very strange result. Now, your Honours, also, if I may put it this way, in this setting, where it is extraordinary to get interlocutory relief in relation to a common law conspiracy. I do not know that your Honours would have ever known of such a case, because damages are an adequate remedy. It is not an equitable ‑ ‑ ‑
McHUGH J: What about cases in England? What about Stratford and Lindley, I suppose they are breach of inducing contract - - -
MR GYLES: Yes, your Honour, that is a different point. Again, your Honour, one would hesitate to say you could not have an injunction in some circumstances where there is a totally different object in view - and I follow what your Honour is putting to me, if you had - well, your Honour has put an example. That may be a case where one could say, well, you have got a totally different sort of situation. 298K is just a minor means of achieving a - now, your Honour, we respectfully submit that this is not such a case; that it would be very unusual to grant an injunction against a conspiracy where, to say the least, there was no examination of the strength of the prima facie case, or arguable case, where damages of prima facie are a complete answer, your Honour.
GAUDRON J: Surely damages are prima facie and not an adequate remedy in a case where there is a question as to the financial stability of anyone of the primary employer.
MR GYLES: There is no question, your Honour - there has been no issue raised as to the financial ability of the defendants to the conspiracy case to meet whatever damages are awarded.
GAUDRON J: Yes.
BRENNAN CJ: Well, that is an interesting proposition because, if the damages consist of the lost earnings of the entire work force for the rest of their working lives, one must wonder about the sufficiency of the defendants’ assets.
MR GYLES: Well, your Honour, we have met a rolling series of points. That is not one of them that we have met so far, your Honour.
McHUGH J: But it is a matter that must be taken into consideration.
BRENNAN CJ: But it is a matter which has to be taken into consideration.
MR GYLES: But we want some factual basis, your Honour.
McHUGH J: Well, that may be but, arguably, here the damages in this case could be enormous.
BRENNAN CJ: Enormous.
McHUGH J: And they could include punitive damages, and that is something that has got to be kept in mind.
MR GYLES: Your Honour, again we are met with another - I mean, I will deal with every point that your Honours wish to put up but I - - -
BRENNAN CJ: No, it is not a question of putting up new points, Mr Gyles.
MR GYLES: Well, your Honour, that is, with respect.
BRENNAN CJ: It is not a question of putting up new points. This is the proposition: the question is conspiracy, and what remedy may be appropriate, on an interlocutory basis, when the case of conspiracy is mounted against a number of the defendants. Now, if the conspiracy be established and a breach by one of the conspirators of 298K is established, the damages must sound, in terms of that which follows from the fulfilment of the conspiracy.
MR GYLES: Subject to the normal principles of damages, your Honour, including mitigation and so on.
BRENNAN CJ: Of course it does. No question about that.
MR GYLES: And would have regard, of course, to the entitlements under the Act. Lifetime damages, your Honour, is not a proposition that has ever been put to me before. I can think of ‑ ‑ ‑
BRENNAN CJ: It would have regard to all the mitigating circumstances in relation to lost earnings.
McHUGH J: Prospects of re-employment.
BRENNAN CJ: Prospects of re-employment. Everything that would be relevant to the damage suffered by the series of individuals would obviously have to be taken into account. The only proposition that I think you have to deal with is that if those causes of action succeed at the end of the day, the damages must be enormous.
MR GYLES: Well, your Honour, I respectfully submit it mistakes the principles.
McHUGH J: It does not because it is relevant to the Mareva injunction. The orders restraining order (6).
MR GYLES: Well, that is not a basis that was ever advanced, your Honour. Can I deal with one point at a time? So far as the massive damages are concerned, leaving aside punitive damages for a moment, and your Honours will pardon me, I have not thought of that before this moment, but ‑ ‑ ‑
BRENNAN CJ: Something which is very obvious on the face of the instrument.
McHUGH J: On the face of the statement of claim, if those allegations are made good, there would be a real chance, one would have to say, that there was a case for punitive damages. Take breach of clause 43 of the award, to start, failure to consult.
MR GYLES: Well, your Honour, that is not - I do not ‑ ‑ ‑
McHUGH J: You may be on strong ground when you get to some of the orders that have been made in this case, but on conspiracy I think you are on your weakest asset.
MR GYLES: All right, your Honour, can I just deal briefly with the point that was put to me? I respectfully submit that, even if established, and leaving aside, for this purpose, exemplary damages, what your Honours put to me assumes that the employees have a right to employment for life. Now, their employment is governed by an award or a certified agreement and one could not possibly go beyond that, we would respectfully submit, and the Commonwealth is a party, your Honour, the Commonwealth is a party.
But, the fact is that contracts have been made with my clients. My clients have engaged a workforce - a workforce of some 350 people who also, in our respectful submission, have legitimate expectations or, at least, legitimate rights, to be considered when equity, the great conscientious system of jurisprudence, considers how its considerable discretionary powers ought to be exercised.
McHUGH J: Does it necessarily require the invoking of equitable jurisdiction? As Justice Gaudron has emphasised, at least so far as 298K is concerned, the question is one of remedying the effects of the conduct. Now, what is there in the nature of the language of that section which would stop a court making an order against third parties or strangers to the proceedings?
MR MERRALLS: Is your Honour referring to an ultimate order, or to an interlocutory order ‑ ‑ ‑
McHUGH J: I am talking to an ultimate order, because I think unless you work out whether you can make an ultimate order, it is not easy to see what interlocutory orders you can make.
MR MERRALLS: Yes. In our submission, a court would be very loath to make orders which disregarded the interests, perhaps intervening interests, of third parties, under that section.
It may or it may not. An order for reinstatement may, in fact, involve the dismissal of a person who has been retained in employment in the interim. It may not. It may be that the Court considers that it would be inappropriate to penalise such a person, even to give effect to the right involved in the unlawful dismissal of the plaintiff. But in the present matter ‑ ‑ ‑
McHUGH J: Do you have an exclusive contract with the stevedoring operations?
MR MERRALLS: Do we have an exclusive contract?
McHUGH J: Yes.
MR MERRALLS: No, we do not.
McHUGH J: You do not.
MR MERRALLS: No, but in the present matter, his Honour did not weigh the hardship that would be inflicted upon my clients and their employees as against any other hardship that ought to be thrown on the balance when exercising equitable jurisdiction. May I take the Court briefly to his Honour’s judgment at, I think it is page 13.
His Honour adopts the modern style of judgment writing of having subheadings, and on page 13 the subheading attached to the following section of the judgment is headed “The new labour force, cost to Patricks and effect on third parties”, and his Honour sets out some of the provisions of the agreement with PCS for 7 April. At the foot of the page he refers to clause 16.1, which is a sort of force majeure provision. Now, he expresses a view about the effect of that provision at the top of the next page; a view, I might say, that the Full Court was inclined to doubt, but he says:
The clause would appear to apply to the situation where PSO was unable to use labour from PCS as a result of an injunction granted by the Court. The parties seem to have anticipated the possibility that fulfilment of the obligations may be rendered impossible.
I do not know whether that sentence is intended to relate to the previous one. The comment applies, of course, to the provision as a whole and is not confined to the consequences of an injunction.
The timing of the contract supports this view.
Why the timing of the contract should support the view a force majeure clause is also open to doubt.
On 6 April 1998, the applicant filed a notice of motion, returnable on 8 April 1998, in the previous action seeking orders -
Then his Honour says:
Given the corporate relationship, it is likely that the action against the present first and second respondents and Mr Corrigan would have been known to PSO. The affidavit in support of the notice of motion, sworn by Joshua Bornstein on 6 April 1998, stated that the basis of the application included a concern by the National Secretary of the Union that the Patricks’ work force would be terminated and:
“that if this should occur, and binding contractual arrangements are entered into with third parties, the Applicants will be seriously prejudiced in the prosecution of this proceedings and in relation to the remedies that they seek”.
And then his Honour proceeds:
PSO entered into the obligation aware of the risk of such an injunction. This consideration reduces the force of the contention that the PCS contract is a factor against granting the injunctions.
But there is not a word of PCS’s position, and no finding is made of any knowledge, no prima facie finding is made of any knowledge or conduct that would deny PCS the right to have hardship being inflicted upon it being taken into consideration when the court exercised its discretionary power.
Then his Honour goes on to refer to accounts, the undertaking for damages by the Unions and in the next page to contracts made also on 7 April between PSO and other companies and they are companies concerned with the maintenance of equipment and, in the case of the company, KSK Contractors, the supply of stevedoring labour and equipment, but there is no consideration in that section, notwithstanding the subheading, of the effect or likely effect of the making of an order in terms of paragraph 4 upon my client companies and the employees work force of one of them. Now, the matter was adverted to ‑ ‑ ‑
BRENNAN CJ: Do you represent any of the work force?
MR MERRALLS: No, but we say that the work force are in the position that many third parties are when the court is invited to exercise jurisdiction to grant interlocutory injunctions and it is always said that if it appears that a third party is likely to be affected, that is a matter which the court must take into consideration.
That is where the third parties are not before the Court in such a case, that the Court must tread very warily, and it has always been said that it ought to pay particular attention to possible harm that would be inflicted upon persons who are not before the Court. So their position is, in a sense, a fortiori to the position of my clients who are before the Court and, through the feeble efforts of their advocate, are able to present their case to the Court.
McHUGH J: Past or present?
MR MERRALLS: May I take the Court to the corresponding section - it is quite short - in the judgment of the Full Court, which has two subheadings. It is on page 14. The first is “Misconstruction of the PCS Resources Agreement” and the second is “Effect on Third Parties”. Their Honours say:
A variety of submissions were put substantially to the effect that the orders had the effect of adversely affecting the rights of innocent third parties and that it was wrong to make the orders in those circumstances.
It is true that if an interlocutory order, especially an interlocutory injunction, would operate unfairly on an innocent third party that is a reason against making of the order. North J clearly understood this. His reasons for judgment demonstrate that this factor was taken into account.
In our submission, it requires a good deal of inference from his Honour’s reasons for judgment to make that statement.
His Honour considered that, in the circumstances of the case, the effect of the injunctions on third parties should not assume the importance that it otherwise would do.
Well, he may have considered that, but he did not say so.
The principle reasons was that the relevant third parties, being those who had entered into agreements with the Patrick employers that would for practical purposes be rendered ineffective by the injunctions, did so knowing of the risk that a Court might make some order that would affect their rights.
Well, that is not a reason that was given by his Honour Mr Justice North at all. There is no evidence to come to that conclusion or to support that conclusion, in our submission.
It seems to us, on the evidence, there cannot really be a dispute about this finding. Further, we do not accept the assertion that the learned trial Judge did not have in mind the effect that the injunctions would have had on employees of the third parties who would also be affected by the grant of the injunctions.
In our submission, a most remarkable statement, because there is absolutely nothing in his Honour’s reasons for judgment which suggested that he had paid the remotest attention to the effect that the injunction would have. It is all very well to say what it should have, because he should have known that there were employees, but he did not say so. In our submission, where a judge, exercising equitable jurisdiction, is doing so in a way that can have deleterious effects upon people, such as the 350 employees, then he should say so and he should give his reasons why he regards the infliction of harm on one element of the work force, as being justified in the interests of another element of the work force. There is not a word in his judgment which suggests that he adverted to that consideration at all. In our
submission, it is quite wrong for the Full Court of the Federal Court to have attributed to him that consideration.
It goes without saying that if the third parties are adversely affected by the orders, so would be the expectations of their employees. The failure to express mention of the employees does not demonstrate any error. I see it is witching hour, your Honour.
BRENNAN CJ: Yes. How long would you expect the remainder of your submissions to take?
MR MERRALLS: Ten minutes.
BRENNAN CJ: Yes, thank you. What estimates could I have from other counsel? First of all, Mr Murdoch?
MR MURDOCH: We would think in the vicinity of half an hour to 45 minutes.
BRENNAN CJ: Yes, thank you. Mr Harris?
MR HARRIS: If it please the Court. At this stage, your Honours, I do not intend to make any submissions.
BRENNAN CJ: Mr Pagone?
MR PAGONE: Your Honours, I expect to say nothing but if I say something it will take a minute or two.
BRENNAN CJ: Yes, and Mr Burnside?
MR BURNSIDE: More difficult to estimate. Between one and two hours, depending I think, in large part, on your Honours.
BRENNAN CJ: Yes, I would think that is probably right. The Court will adjourn until 10 am tomorrow morning.
AT 4.32 PM THE MATTER WAS ADJOURNED
UNTIL TUESDAY, 28 APRIL 1998
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