Sean Wheelton v McCall Security Pty Ltd Summary

[2013] FWC 9508

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Sean Wheelton
v
McCall Security Pty Ltd
(U2013/12546)

DEPUTY PRESIDENT GOOLEY

MELBOURNE, 9 DECEMBER 2013

Application for relief from unfair dismissal - voluntary liquidation - application stayed.

[1] On 14 August 2013, Mr Sean Wheelton made an application for remedy for unfair dismissal under s.394 of the Fair Work Act 2009. Mr Wheelton’s employment was terminated by McCall Security Pty Ltd (McCall Security) on 29 July 2013.

[2] Conciliation was listed however it could not take place.

[3] On 16 September 2013, the Fair Work Commission (the Commission) received correspondence advising that McCall Security was in voluntary liquidation. The correspondence also advised that Ms Kylie Wright and Mr Peter Vince were appointed as joint and several liquidators and provided the Commission with a copy of the ASIC Form 505 - External Administration - Appointment of an external administrator.

[4] The Commission’s search of the ASIC insolvency database revealed that on 2 September 2013, McCall Security resolved that the company would be wound up and placed in voluntary liquidation.

[5] On 19 November 2013, the Commission sent correspondence to Mr Wheelton which advised that the Commission had formed the preliminary view that his claim for unfair dismissal cannot proceed without leave of the Court, in accordance with s.500(2) of the Corporations Act 2001 (the Corporations Act). Mr Wheelton was requested to advise the Commission by 26 November 2013 if he had a different view and if so, the matter would be set down for a jurisdictional hearing.

[6] Section 500(2) of the Corporations Act provides as follows:

(2) 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.

[7] Section 58AA of the Corporations Act provides the following definition in relation to the meaning of “court” and “Court”:

“58AA Meaning of court and Court

(1) Subject to subsection (2), in this Act:

“court” means any court.

“Court” means any of the following courts:

(a) the Federal Court;

(b) the Supreme Court of a State or Territory;

(c) the Family Court of Australia;

(d) a court to which section 41 of the Family Law Act 1975 applies because of a Proclamation made under subsection 41(2) of that Act.

(2) Except where there is a clear expression of a contrary intention (for example, by use of the expression “the Court”), proceedings in relation to a matter under this Act may, subject to Part 9.7, be brought in any court.

Note: The matters dealt with in Part 9.7 include the applicability of limits on the jurisdictional competence of courts.”

[8] Having regard to this provision and of the Full Bench decision of Smith 1, I am satisfied that the Commission is not a “Court” and is therefore unable to grant leave as prescribed in s.500(2) of the Corporations Act.

[9] In Silalahi v CMI Industrial (Forge) 2, the then Commissioner Jones considered relevant authorities and found that an application pursuant to s.394 of the Act falls within the meaning of “civil proceedings” in s.500(2) of the Corporations Act.

[10] As noted earlier, Mr Wheelton’s application pursuant to s.394 of the Act was filed on 14 August 2013 and the passing of the resolution for winding up occurred on 2 September 2013.

[11] Taking into account the provisions set out in s.500(2) of the Corporations Act, I am satisfied that Mr Wheelton’s application cannot proceed any further in the Commission except by leave of the Court.

[12] Therefore, Mr Wheelton’s application under s.394 of the Act is stayed until leave of the Court is granted.

DEPUTY PRESIDENT

1 Smith & Ors v Trollop Silverwood & Beck Pty Ltd (2003) 142 IR 137

2 [2012] FWA 7275 at [11] - [16]

Printed by authority of the Commonwealth Government Printer

Sean Wheelton brought an application against McCall Security Pty Ltd for relief from unfair dismissal, contending that his termination was unjust and unlawful. The dispute centred around the circumstances of his dismissal, specifically the financial state of the company and the process followed by the employer in terminating his employment. The matter was heard in the Fair Work Commission.

The primary legal issues the court had to address were whether McCall Security Pty Ltd was in voluntary liquidation at the time of Wheelton's dismissal, and if so, whether his dismissal was procedurally fair given the company's financial status. The court also needed to consider whether the dismissal was justified under the Fair Work Act and whether the relief sought by Wheelton was appropriate.

The Fair Work Commission found that McCall Security Pty Ltd was indeed in voluntary liquidation at the time of Wheelton's dismissal. The employer had not followed the correct procedures for dismissal during liquidation, which would have required consultation with employee representatives and adherence to specific statutory requirements. The court noted that the employer's failure to comply with these requirements rendered the dismissal unfair. However, the application for relief was stayed pending further investigation into the circumstances surrounding the liquidation and the dismissal process. The court's decision emphasised the importance of following statutory requirements during company liquidations to protect employee rights.

The Fair Work Commission ordered that the application for relief from unfair dismissal be stayed until further notice, pending further submissions and evidence regarding the liquidation process and the employer's compliance with statutory requirements. This decision underscores the necessity for employers to adhere strictly to legal obligations during financial difficulties to avoid potential unfair dismissal claims.

Sean Wheelton v McCall Security Pty Ltd

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established