Shockthorap v Electricity Network Corporation

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FEDERAL COURT OF AUSTRALIA

Shockthorap v Electricity Network Corporation [2019] FCA 619

Appeal from: Application for extension of time and leave to appeal:  Shockthorap v Electricity Network Corporation (t/as Western Power) [2018] FCCA 1706
File number: WAD 329 of 2018
Judge: BANKS-SMITH J
Date of judgment: 6 May 2019
Catchwords: PRACTICE AND PROCEDURE - application for extension of time and for leave to appeal - where primary judge summarily dismissed application on the basis that the proceedings had no reasonable prospects of success - where basis of dismissal was settlement agreement - where applicant seeks to challenge any settlement on basis vitiated by incorrect legal advice - whether there is a genuine question as to whether advice given in the presence of first respondent's lawyers - where applicant claimed no settlement agreed as alleged - where applicant claimed any settlement agreement was abandoned - whether primary judge's decision is attended by sufficient doubt to warrant reconsideration - whether substantial justice would result if leave were denied - extension of time granted - leave to appeal granted in part
Legislation:

Fair Work Act 2009 (Cth)

Federal Circuit Court of Australia Act1999 (Cth) s 17A

Federal Court of Australia Act 1976 (Cth) s 24(1A)

Federal Circuit Court Rules 2001 (Cth) r 45.06, 45.07, 45.08

Federal Court Rules 2011 (Cth) r 35.13
Cases cited:

Cedar Meats (Aust) Pty Ltd v Five Star Lamb Pty Ltd [2014] VSCA 32

Decor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 844; (1991) 33 FCR 397

Dennis v Commonwealth Bank of Australia [2018] FCA 1908

Deputy Commissioner of Taxation v Revolve Limited [2012] FCA 555

Fazio v Fazio [2012] WASCA 72

Hunter Valley Developments Pty Ltd v Cohen, Minister for Home Affairs and Environment [1984] FCA 186; (1984) 3 FCR 344

Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited [2008] FCAFC 60; (2008) 167 FCR 372

Johnson Tiles Pty Ltd v Esso Australia Pty Ltd [2000] FCA 1572; (2000) 104 FCR 564

Masters v Cameron (1954) 91 CLR 353

McRae v Commonwealth Disposals Commission (1951) 84 CLR 377

Minogue v Williams [2000] FCA 125

NASB v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 24

National Australia Bank Limited v Sayed (No 4) [2015] NSWSC 420

Plankton Australia Pty Limited v Rainstorm Dust Control Pty Limited [2018] FCA 174

Plankton Australia Pty Limited v Rainstorm Dust Control Pty Limited [2018] FCAFC 205

Samsung Electronics Co Limited v Apple Inc [2011] FCAFC 156; (2011) 217 FCR 238

Taylor v Johnson (1983) 151 CLR 422

Vassallo Construction Pty Ltd v Andergrove Lakes Pty Ltd [2014] FCA 862

Wallera Pty Ltd v CGM Investments Pty Ltd [2003] FCAFC 279

Waters v Commonwealth of Australia (Australian Taxation Office) [2017] FCA 1199

Wills v Australian Broadcasting Corporation [2009] FCAFC 6
Date of hearing: Determined on the papers
Registry: Western Australia
Division: Fair Work Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 77
Counsel for the…
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Details
Case
[2019] FCA 619
Decision Date

CaseChat Overview and Summary

In the case of Shockthorap v Electricity Network Corporation, the applicant, Ms Shockthorap, sought an extension of time and leave to appeal against a decision of the primary judge who had dismissed her application on the grounds that it had no reasonable prospects of success. The primary judge's dismissal was based on the existence of a settlement agreement between Ms Shockthorap and Western Power. Ms Shockthorap sought to challenge this settlement on the basis that it was vitiated by incorrect legal advice. The court was required to decide whether there was a genuine question as to whether the advice was given in the presence of Western Power's lawyers, and whether the primary judge's decision was attended by sufficient doubt to warrant reconsideration.

The court found that there was a genuine question as to whether the advice was given in the presence of Western Power's lawyers, as the File Note arguably supported a reasonable inference that there was at least some discussion about access to the Federal Court in their presence. Additionally, the court found that the primary judge's decision was attended by sufficient doubt to warrant reconsideration, as the existence of an alleged mistake was not conclusively established and the potential impact of such mistake on the agreement could not be ruled out. The court also considered that substantial justice would result if leave were granted, as the short period of delay involved and the findings as to merits warranted an extension of time for leave to appeal.

In light of the above, the court granted leave to appeal but did not extend it to any argument that Western Power abandoned any agreement entered into between the parties in March 2014. The time for filing a notice of appeal was extended to 24 May 2019, and unless the parties filed submissions seeking different orders within seven days, the costs of the application for an extension of time and for leave to appeal were reserved for determination in the appeal.

Orders

Orders of the court

1. Leave to appeal is granted but does not extend to any argument that the first respondent abandoned any agreement entered into between the parties in March 2014.

2. The time for filing a notice of appeal is extended to 24 May 2019.

3. Unless the parties file submissions seeking different orders within seven days, the costs of the application for an extension of time and for leave to appeal be reserved for determination in the appeal.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

In this case, it cannot be disputed that the summary dismissal, whilst interlocutory, has a significant effect on the proceedings: it means that Ms Shockthorap is denied the ability to further pursue her claim.Facts In order to assess the merits of the prospective appeal it is necessary to set out in some detail the matters that came before the primary judge.Initial dispute with Western Power Ms Shockthorap was employed as a contractor to Western Power and had performed work in Western Power's contact call centre as a casual employee. On 19 February 2014, Ms Shockthorap filed a non‑dismissal general protections claim against Western Power in the Fair Work Commission (FWC) on the basis that she had been overlooked for permanent employment because of the amount of unpaid carer's and bereavement leave she had taken, and that she had later been dismissed because of that leave and because she had made a complaint.The mediation conference There was a mediated conferral between the parties in the FWC on 17 March 2014. Western Power was represented by two lawyers and a client representative. Ms Shockthorap did not have a lawyer present. Aspects of what occurred at that mediation are not in dispute. For example:(a)the mediation commenced with a joint session, and then the parties were separated for discussions with the Commissioner. Although not said expressly, it is apparent that there was then a further joint session (apparent from references in Western Power's evidence to matters said by the Commissioner to Ms Shockthorap, from references to matters said by Western Power's lawyers and from a file note referred to below);(b)the mediation concluded on the basis that Western Power offered to pay Ms Shockthorap a settlement sum of $5,000 (gross) on a non‑admission basis and provide a letter of regret in full and final settlement of Ms Shockthorap's claim;(c)Western Power's lawyer said that it would leave its offer open until 10.00 am the following day (there is a conflict in the evidence as to which lawyer made the statement but nothing turns on that for present purposes);(d)there would be a deed of settlement that would include 'the usual terms regarding confidentiality and non‑disparagement'; and(e)the Commissioner asked Ms Shockthorap to advise him if she accepted the offer. According to Western Power, the Commissioner also said that the purpose of the settlement deed was not to renegotiate the settlement but rather to reflect the common understanding of the parties. Ms Shockthorap's evidence before the primary judge included the following (Ms Pole being one of Western Power's lawyers):4.In relation to paragraph 19 of Ms Pole's Affidavit, I agree that [the Commissioner] asked me to advise his associate if I accepted the offer and made reference to a deed. However, I do not recall [the Commissioner] making comment on the purpose of the deed.5.I did not consider the offer to be fair.6.[The Commissioner] told me that if I did not accept the offer, I would have to initiate proceedings in Federal Court within 14 days of the conference to continue my claim.7.I was very confused about what to do, so I asked for some time to think about it. Ms Pole said I had until 10am the following day to accept the offer or it would be 'off the table'.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The subsequent negotiations between the parties covered a shifting ambit of claims and it is not surprising that Western Power put forward a range of proposals that might see all arguments resolved at once. Western Power made it clear from 10 April 2014 that it considered there was already a binding agreement. I do not consider the evidence would justify a finding that, having made its position clear, Western Power's later attempts to settle the ambit of disputes undermined the veracity of the pre-existing agreement. Having carefully considered the correspondence, I am not satisfied there is any reasonable prospect of a claim on the basis of abandonment succeeding and I would not grant leave to pursue an appeal point that relies on abandonment.Conclusion Having regard to the short period of delay involved and the findings as to merits, an extension of time for leave to appeal from the decision of the primary judge is granted. The proposed notice of appeal is in general terms. Cognisant that Ms Shockthorap is currently self‑represented but that such position may change, it may be that amendments or particularisation of the appeal grounds are sought. It should be clear that subject to any further order, the ambit of matters that might be raised on appeal in accordance with this grant of leave is not to extend beyond the issues summarised at [51]‑[52] and as addressed in these reasons, and is not to extend to the issue of abandonment. Unless the parties seek a different order within seven days, the costs of the application for an extension of time and leave to appeal are reserved to the determination of the appeal court.

Ratio Decidendi

Legal Principle Established

As to Ms Shockthorap's submission that Western Power's subsequent conduct represented an abandonment, Western Power submitted that Ms Shockthorap's argument does not alter the primary judge's finding that the subsequent negotiations did not result in a concluded agreement and therefore do not affect the existence of an existing agreement.Consideration of merits In my view whether leave should be granted to appeal the primary judge's finding that a contract was formed on 18 March 2014 is resolved primarily by consideration of the question of whether any alleged statement was made by the Commissioner in the presence of the Western Power representatives to the effect that Ms Shockthorap had only 14 days in which to bring an application in court. It is important to note Western Power's submissions on this issue before the Federal Circuit Court:30.The First Respondent submits that the facts in this matter do not support either of the above exceptions, because:(a)the guidance which the Applicant claims she received from the Commissioner occurred in a private conference, to which the First Respondent was not a party therefore it could not have known or become aware of the alleged mistake; and(b)the First Respondent did not induce or encourage the Applicant to hold any alleged mistaken belief.31.The First Respondent submits that the Court must make a finding that any misinformation the Applicant may have received from the Commissioner does not void the 2014 Agreement.(footnote omitted) In support of its submission at [30(a)], Western Power referenced the evidence of Ms Shockthorap referred to above, that:[The Commissioner] told me that if I did not accept the offer, I would have to initiate proceedings in Federal Court within 14 days of the conference to continue my claim. What is said at [30(b)] of the submissions is no more than a submission. A difficulty with the submission as cited by the primary judge is that read in the chronological context of all of the statements repeated at [20] of these reasons, and taking into account the File Note, it is by no means clear that Ms Shockthorap asserted that such conversation took place at a point in time of the mediation when the Western Power representatives were not present. Ms Shockthorap does not say it occurred in a private conference (or that there was a single conversation). The File Note (which was in evidence before the primary judge) arguably supports a reasonable inference that there was at least some discussion about access to the Federal Court in the presence of the Western Power representatives and it would not be unreasonable to infer that such discussion may have included a reference to the 14‑day time limit on such access (as to the drawing of reasonable inferences see in particular Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited [2008] FCAFC 60; (2008) 167 FCR 372 at [122]‑[135]). Western Power's affidavit evidence was otherwise silent on this factual issue. The primary judge in considering the question of whether Western Power was aware of the Commissioner's alleged statement recited the submission at [30] and [31] and then said (at [38] of the reasons):The applicant's evidence in her affidavit of 19 February 2018 (page 8) is that the first respondent was not present when the alleged advice concerning 14 days was given to the applicant by the Commissioner. There is no evidence to suggest that the first respondent was aware of the Commissioner's alleged guidance. There is, in these circumstances, no basis for a finding of unilateral mistake.