Rosemary Hammerton v Knox Grammar School

[2013] FWC 9024

[2013] FWC 9024

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 394 - Application for unfair dismissal remedy

Rosemary Hammerton
v
Knox Grammar School
(U2013/10270)

DEPUTY PRESIDENT SAMS SYDNEY, 15 NOVEMBER 2013

Notice to produce documents - application to set aside - communications between Union and its member - legitimate forensic purpose - application dismissed.

[1] Mrs Rosemary Hammerton (the ‘applicant’) has filed an application, pursuant to s 394 of the Fair Work Act 2009 (the ‘Act’) (the ‘substantive matter’), for reinstatement to her former position at Knox Grammar School (the ‘School’) following her ‘resignation’ on 15 May 2013. The substantive matter has been prepared for hearing and is listed for that purpose on 11 and 12 December 2013.

[2] As might be apparent from the reference to ‘resignation’ above, there is a fundamental jurisdictional issue for the Commission to determine in the substantive matter as to whether the applicant was forced to resign; ie, constructively dismissed. If the applicant establishes that proposition and assuming no other jurisdictional issues arise, then s 386(1) will act to ground the Commission’s jurisdiction to determine the matter on its merits, or, more specifically, to decide whether the applicant’s constructive dismissal was ‘harsh, unreasonable or unjust’ within the meaning of s 387 of the Act.

[3] There is no doubt that the jurisdictional issue is hotly contested by the parties. So much so is plain from the evidence which has been filed to date. In this context, the School has sought an order, pursuant to s 590(2) of the Act requiring the production of documents by the NSW ACT Independent Education Union (the ‘Union’) . The documents sought are:

‘The Union’s complete file in respect of the Applicant’s dealings with the Respondent on and from 25 February 2013 including correspondence between the Union and the Applicant.’

[4] I interpose here to note the Union no longer represents the applicant, although it did so in the lead up to the applicant’s resignation on 15 May 2013. The Union and the applicant both oppose the production of the documents and seek the setting aside of the order on various grounds, but primarily on grounds related to the fact that the Union was attempting to negotiate a settlement of the dispute with the School on the applicant’s behalf, before her resignation. Accordingly, the communications between her and the Union were confidential and ‘without prejudice’.

[5] It is conceded that no signed agreement/settlement was formally entered into. However, there is a real contest as to what the Commission is able to conclude from the differing views of the applicant and the School’s Deputy Headmaster, Mr Paul Brown, as to the extent and outcome of these negotiations and the facts and circumstances surrounding various exchanges between the parties. I agree with Mr Moorhouse of Counsel for the School, that the filed statements disclose an evidentiary conflict on these issues.

[6] The application to set aside the notice was listed for hearing on 13 November 2013. Mr S Koulouris appeared for the Union, Mr G Johnson of Counsel for the applicant and Mr P Moorhouse of Counsel appeared with Mr L Scandrett, Solicitor for the School. There was no recording or transcript taken of the proceedings. I will not attempt to address all of the parties’ arguments, but concentrate on the salient points which were raised.

[7] Shortly stated, Mr Koulouris argued that communications between a Union and its member should be treated as strictly confidential. 100 years of this convention should not be lightly departed from. He said that such communications were akin to lawyer/client privilege and should be treated the same way. It was also said that, in any event, there was no signed settlement or any agreement to settle. The negotiations were purely on a ‘without prejudice’ basis. He said there was no legitimate forensic purpose grounding a need for the documents to be provided to the School. Mr Koulouris added that the Union had complied with the order and the Union’s files were available to the Commission. He had separately identified the communications between the Union and the School and the Union and the applicant.

[8] Mr Johnson supported Mr Koulouris’ submissions and added that any relevance (if there be any) on the settlement negotiations could be dealt with in the cross examination of witnesses. However, as the issue in the substantive proceedings concerned the conduct of the School in forcing the applicant’s resignation, the communications between the applicant and the Union would have no bearing on that matter. Mr Johnson also said that the order was too wide and non-specific. It should be set aside on that basis. He added that it was irrelevant what the Union had agreed with the School, as the applicant had not agreed to any settlement.

[9] Mr Moorhouse submitted that the issue of whether a settlement was understood to have been reached between the parties (albeit unsigned); See: Masters v Cameron (1954) 91 CLR 353), was a very relevant consideration as to whether the applicant had voluntarily resigned. Her resignation was in the context of these negotiations and her filed evidence was misleading; See: s 131(2)(g) of the Evidence Act 1995 (Cth). He noted that there was a clear evidentiary conflict between the applicant and Mr Brown as to what they understood the position to be in May 2013 (paras [59]-[61] of Mr Brown’s statement). As the Union was actively representing the applicant, any communications between her and the Union might corroborate one person’s version of events or conversations over another. He stressed Mr Brown’s statement (paras [45]-[47]) which demonstrated that the applicant was actively pursuing redundancy, rather than reinstatement.

[10] In any event, Mr Moorhouse said the issue of the negotiations cannot be irrelevant when the applicant herself raised the matter in her own statement (see paras [6]-[8]). Mr Moorhouse relied upon a decision of Ritter JR in Wood v Commonwealth Bank of Australia (1996) 67 IR 46 at pp 63-65, which determined that communications between an industrial organisation and its members is not akin to legal professional privilege.

[11] Finally, Mr Moorhouse said that the School had not fully determined whether it would argue that a binding settlement had been reached between the applicant and the School.

CONSIDERATION

Principles to be applied

[12] In McIlwain v Ramsay Food Packaging Pty Ltd (2005) 221 ALR 785, Greenwood J helpfully distilled the principles to be applied in relation to disputes over the production of documents. These are:

‘a) A writ of subpoena duces tecum is competent against both a party and a stranger to the proceeding: The Adelaide Steamship Company v Spalvins (unreported, O’Loughlin J, 1 August 1997).

...

d) The documents for production must be identified with reasonable particularity. (The Commissioner for Railways v Small (1938) SR (NSW) 564, 574-575 per Jordan CJ). The category of documents must not be so wide as to be oppressive.

e) The documents must be relevant to an issue raised on the pleadings and be used to elicit documents to support the applicant’s existing case. It cannot be used for purposes of ‘fishing’ or for the purpose of determining a preliminary question as to whether the party has a supportable case (Hennessy v Wright (1888) 21 QBD 509), or to investigate the character of the opposing party’s evidence (Griebart v Morris [1920] 1 KB 659, 666).

f) The test for relevance does not require that a party demonstrate direct relevance to the contest between the parties. Rather, the documents must have some potential relevance to the pleadings as they stand. In Australian Gas Light Company v Australian Competition & Consumer Commission [2003] FCA 1101, French J summarised the matters which are relevant to the grant of leave:

"It is not appropriate to be overly prescriptive in setting out criteria for the grant of leave to issue a subpoena. Plainly, the documents sought must have at least some apparent potential relevance to the matters in issue in the litigation. The assistance that the requesting party may derive from the production of such documents must be taken into account. Case management considerations are also relevant. A wide-ranging subpoena, seeking documents of doubtful relevance at great inconvenience to, or that risk compromising the commercial privacy of, a third party, may not readily attract the grant of leave. Where the issue of such a subpoena is likely to delay progress to trial because of the legitimate interests of a party in resiting its issue, that may also be a practical factor to be weighed."

g) The same notion was expressed in Small (575) and Dorajay Pty Limited v Aristocratic Leisure Limited [2005] FCA 588, [34] in requiring the existence of a legitimate forensic purpose for the production of documents.

h) In Trade Practices Commission v Arnotts Limited(No. 2) (1989) 21 FCR 306, Beaumont J said that the question of whether a subpoena should go can conveniently be addressed by reference to two questions. First, does the material sought by the subpoena have an apparent relevance in a descriptive or adjectival sense rather than a substantive sense? Does the subpoena have a legitimate forensic purpose to this extent from the perspective of the party issuing the subpoena? Secondly, does the subpoena cast a serious and unfair burden or prejudice upon the respondent to the subpoena?

i) Spender J in Cosco Holdings Pty Ltd v Commissioner for Taxation [1997] FCA 1504 suggested that adjectival relevance looks toward the possibility whether the material sought could reasonably be expected to throw light on some of the issues in the principal proceedings.

j) When a party contends material that either is or may be or may have been in the possession, custody or power of a respondent relates to any question or issue raised on the pleadings, they will be taken to mean that the material is relevant in the sense contemplated by section 55 of the Evidence Act 1995 (Cth) namely, evidence that if accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceedings. This is the substantive relevance of the material. The test for the issue of the subpoena is whether the material appears to have relevance in the sense of throwing light on at least some of the issues in the principal proceeding.

k) The relevance of the documents must not be disproportional to any benefit that their production might have for the respondent: Dorajay [34].

l) A subpoena ought not issue in circumstances where it would unduly disrupt the conduct of the trial by requiring the Court to read documents which could have been obtained at an earlier stage in the proceedings: Diddams v Commonwealth Bank of Australia [1998] FCA 497.

m) The issue of the subpoena must not, in all the circumstances be oppressive in terms of its impact on the recipient. That is, the issue of the subpoena must not be ‘seriously unfairly burdensome, prejudicial or damaging’ and ‘productive of serious and unjustified trouble and harassment’. (Hamilton v. Oades [1989] HCA 21; (1989) 166 CLR 486, 502, Oceanic SunLine Special Shipping Co. Inc. v. Fay [1988] HCA 32; (1988) 165 CLR 197, Seven Network Limited v News Limited (No 5) [2005] FCA 510; [2005] 216 ALR 147, [12].

n) The issue of a subpoena against a stranger to the proceeding is more likely to succeed later in the proceeding. Though there is no formal barrier to a subpoena to produce being returnable prior to the hearing, the document may well be premature where no trial date has been fixed. Where the proceeding is of considerable evidentiary complexity there is stronger force to serving the subpoena at an earlier stage: Hughes v Western Australian Cricket Association (1986) 66 ALR 541.

o) In Dorajay Pty Limited v. Aristocrat Leisure Limited [2005] FCA 588 at paragraph [17], Stone J noted the observations of Waddell J in Spencer Motors Pty Ltd v. LNC Industries Ltd [1982] 2 NSWLR 921 at 927, summarising the views of Moffitt P in National Employers’ Mutual General Association Ltd v. Waind & Hill [1978] 1 NSWLR 372 to the effect that whether subpoenas are oppressive or an abusive process depends on whether "it is reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case". Her Honour said at paragraph [18]:

"These authorities show that the criteria by which one determines whether a subpoena should be set aside, in whole or in part, may be expressed in different ways but ultimately, they all come down to whether such action is required to prevent an abuse of the processes of the court to prevent injustice. As Deane and Gaudron JJ recognised [Hamilton v Oades [1989] HCA 21; (1989) 85 ALR 1 at p.11] in the comments quoted by Beaumont J [in Trade Practices Commission v. Arnotts Limited], various terms may be used in focusing these concerns on the circumstances of a particular case. In this case, whether the documents are relevant (in the sense used by Beaumont J) will determine the issue provided that the requirements of the subpoena are not otherwise oppressive."’

[13] See also: Coates Hire Pty Limited T/A Coates Hire Limited v Australian Manufacturing Workers’ Union; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; Transport Workers’ Union of Australia[2013] FWC 1585.

[14] For my own part, I am a little uncomfortable in ordering the production of documents which deal with ‘without prejudice’ settlement negotiations in the context of substantive unfair dismissal proceedings. If such a course was to become widespread, it could well act as a disincentive to parties to willingly and frankly engage in ‘without prejudice’ negotiations and unduly restrict propositions by parties to settle matters knowing that they may be later used against them. Given the policy emphasis in the Act on the settlement of claims for unfair dismissal, such a course should not be widely encouraged. I also consider there to be some force to the Union’s argument that communications between its officers and the Union’s members would ordinarily be strictly confidential. To allow access to an employer involved in a dispute over the same subject matter, should be eschewed.

[15] However, these concerns are outweighed by the following factors:

1. The applicant herself has raised the issue of the settlement negotiations and in some detail. She did so in the context of pressing her primary argument that she had no other option than to resign or be dismissed (applicant’s supplementary statement, paras [5]-[16]).

2. It is plainly relevant for the purposes of establishing whether the applicant voluntarily resigned, or had no other option but to resign, or be dismissed, that documents which may corroborate one party’s version of the true position be produced. I am satisfied that such documents have a legitimate forensic purpose in that respect. The call for their production is not a ‘fishing expedition’: See: Re: Clerks’ (Alcoa of Australia - Other Than Mining & Refining) Consolidated Award 1985 [1988] AIRC 391 per Munro J.

3. There can be no doubt that the applicant’s resignation was given in the context of negotiations for a settlement and contemporaneously with those negotiations. In this sense, documents relevant to these negotiations may well deal with the issue of the applicant’s resignation. I am satisfied that ‘it is on the cards’ that the documents will materially assist the School’s case; See: Regina v Saleam [1999] NSWCCA 86. They have a legitimate forensic purpose.

4. The Union no longer represents the applicant and seeks no involvement in the substantive matter.

5. There is no issue raised as to the order being ‘oppressive’ or unable to be complied with. Indeed, Mr Koulouris had prepared the material and made it available to the Commission. I have taken the opportunity to view the material.

[16] The application to set aside the notice to produce to the Union, dated 1 November 2013, is dismissed.

DEPUTY PRESIDENT

Appearances:

Mr G Johnson of Counsel for the Applicant.

Mr S Koulouris for the NSW ACT Independent Education Union.

Mr P Moorhouse of Counsel with Mr L Scandrett for the Respondent.

Hearing details:

Sydney.

2013:

13 November.

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