Shreea v Ezy Mart Pty Ltd - [2019] FCCA 3050

FEDERAL CIRCUIT COURT OF AUSTRALIA

SHREEA v EZY MART PTY LTD & ANOR

[2019] FCCA 3050

Catchwords:
INDUSTRIAL LAW – Procedure – application in a case to strike out amended statement of claim – amended statement of claim brings substantially different and inconsistent claims – discontinuance against parties formerly claimed to be employers – new claim first respondent is employer, addition of further respondent – orders made striking out the amended statement of claim and dismissing proceedings – costs awarded under s.570(2)(a) of the Fair Work Act 2009 (Cth).

Legislation:

Fair Work Act2009 (Cth), ss.550, 557C, 570(2)(a)

Federal Circuit Court of Australia Act 1999 (Cth), s.17A(2)

Federal Circuit Court Rules 2001 (Cth), rr.13.01(4), 13.022, 13.10

Federal Court Rules 2011 (Cth), r.16.21

Migration Act 1958 (Cth), ss.235, 245AG

Cases cited:

Aon Risk Services Aust Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175

Ellis v Wadjemup Trading (No.3) [2018] FCCA 3075

Ghimire v Karriview Management Pty Limited and Sharma [2018] FCCA 2157; (2018) 336 FLR 153
Hussein v Secretary of the Department of Immigration and Multicultural Affairs (No.2) [2006] FCA 1263; (2006) 155 FCR 304
Ritter v Ritter and Anor [2019] FCCA 782
UBSAG v Tyne as trustee of the Argot Trust [2018] HCA 45

Applicant:

ABDEL RAHMAN AREF ABU SHREEA

First Respondent:

EZY MART PTY LTD

Second Respondent

SADDAM MAGABLEH

File Number:

SYG 724 of 2018

Judgment of:

Judge Baird

Hearing date:

4 September 2019

Date of Last Submission:

27 August 2019

Delivered at:

Sydney

Delivered on:

4 September 2019

REPRESENTATION

Solicitors for the Applicant:

Mr C. McArdle, McArdle Legal

Counsel for the First Respondent:

Mr O. Fagir

Solicitors for the First Respondent:

Zouki Lawyers

Counsel for the Second Respondent:

Ms J. Stuckey-Clarke

Solicitors for the Second Respondent:

Kennedys Law

ORDERS

PURSUANT to r.13.10 of the Rules that the proceeding against EzyMart Pty Ltd and Saddam Magableh be summarily dismissed as I am satisfied the Applicant has no reasonable prospects of success.
ORDERS the Applicant pay the First Respondent’s costs pursuant to s.570(2)(a) of the Fair Work Act 2009 (Cth).
ORDERS the Applicant pay the Second Respondent’s costs of the Application in a case.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 724 of 2018

ABDEL RAHMAN AREF ABU SHREEA

Applicant

And

EZY MART PTY LTD

First Respondent

SADDAM MAGABLEH
Second Respondent

REASONS FOR JUDGMENT

(Ex Tempore, Revised from Transcript)

Introduction

By an Amended Application in a Case dated 12 April 2019, the First Respondent, Ezy Mart Pty Limited, seeks orders, pursuant to r.16.21(2) of the Federal Court Rules 2011 (Cth) (FCRules), that the amended statement of claim (ASOC) (in mark-up dated 15 November 2018, and in changes accepted format handed up to the Court on 12 July 2019), be struck out on the ground that it is an abuse of process (r.16.21(1)(f) of the FCRules), and, I apprehend from the course of submissions before me, on the ground that it also fails to disclose a reasonable…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Shreea v Ezy Mart Pty Ltd

Details

AGLC: Shreea v Ezy Mart Pty Ltd [2019] FCCA 3050
Case: [2019] FCCA 3050
Decision Date: 4 September 2019

CaseChat Overview and Summary

This matter concerned an application by the Applicant, Mr Shreea, against Ezy Mart Pty Ltd (the First Respondent) and Saddam Magableh (the Second Respondent), and other respondents not relevant to this summary. The dispute arose from claims of underpayment of wages. The Applicant sought to enforce an award, but the First Respondent sought to strike out the Applicant's Amended Statement of Claim (ASOC) as an abuse of process. The proceedings were heard in the Federal Circuit and Family Court of Australia before Judge Baird.

The primary legal issues before the court were whether the Applicant's ASOC constituted an abuse of process, and consequently, whether the proceeding should be summarily dismissed. The court also considered submissions regarding the strict liability offence provisions of the Migration Act 1958 (Cth) and the broad definition of "work" under that Act, which the First Respondent argued rendered any claim based on illegal work void and unenforceable. However, the court noted that these submissions were not directed to the enforceability of an award, which was central to the Applicant's case.

Judge Baird concluded that the changes made by the Applicant in the ASOC from the original statement of claim were so significant and inconsistent that they were likely a device to maximise recovery against the respondents, made without a proper basis and for perceived forensic advantage. The court found that the Applicant had no reasonable prospect of successfully prosecuting the proceeding and that the claim against the First Respondent was an abuse of process. Accordingly, the court ordered that the ASOC be struck out and that the proceeding against Ezy Mart Pty Limited and Saddam Magableh be summarily dismissed. The court also ordered that the Applicant pay the First Respondent's costs of the application.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

In relation to striking out a claim (noting Mr Fagir’s submissions have primarily focussed on striking out the ASOC in the present case as being an abuse of process), in Ellis at [36], Judge Lucev observed that the Rules do not provide for a specific power to strike out pleadings, but noted that if in a particular case the Rules are insufficient, the Court may apply the FCRules in whole or in part as necessary: r.1.05(2) of the Rules. His Honour then summarised the principles applicable to the power to strike out a claim or portions of a claim at [37] and [38], referring to r.16.21 of the FCRules. Overview of conclusion I have come to the conclusion - and I do not lightly come to this conclusion - in short, that the changes the Applicant has made in the ASOC from the claims that the Applicant previously contended in the statement of claim are so significant and inconsistent with the previous pleading, that I am entitled to, and do, infer that the change in the allegations to those now pleaded is a device intended to permit the Applicant to maximise his recovery against the various respondents, and that the fresh allegations made in the ASOC against the present respondents are made without a proper basis, and for reasons of perceived forensic advantage, namely in order to maximise prospects of his overall recovery. Below I expand upon why I have come to this conclusion.Applicant’s claimed employment history and hours worked It is useful to summarise the allegations that the Applicant made in his original statement of claim. The claim was filed on 16 March 2018. It contained 23 short paragraphs of “facts and assertions” (numbered [1] – [21], repeating numbers [18] and [19]), and relief claimed in 5 further paragraphs. Attached was a letter of demand dated 19 February 2018 in which McArdle Legal stated that “Mr Shreea has consulted us and provides the following details”, and set out the Applicant’s claimed history of employment by the Ezy Mart Respondents, and the Third respondent (Ezy Mart 300 George Street), the hours worked, rates at which he claims to have been paid, and the claimed underpayment. Whilst the hours are summarised, the total hours worked in each financial year are precisely specified. In his original pleading the Applicant contended that he was employed variously:(a)by “Ezy Mart 58 Pitt Street” on a part time basis from June 2014 to March 2015 (claim, at [10] – “permanent part time employment with the Second Respondent controlled by the Seventh Respondent”); (b)by “Ezy Mart 300 George Street” from March 2015 to March 2016 (claim, at [11] – “the Applicant transferred to the Third Respondent controlled by the Sixth and Eighth Respondents”); (c)by “Ezy Mart The Rocks Harrington Street” from March 2016 to August 2017 (claim, at [12] - “the Applicant transferred to the Fourth Respondent controlled by the Seventh Respondent and resigned on 10 August 2017”). The Applicant went on to plead that:(a)he was underpaid a total of $103,143 (claim, at [16]–[18]); and (b)the First Respondent, is the Franchisor to multiple Ezy Mart stores in Australia, including that conducted by the Second Respondent, is a “Responsible Franchisor entity”, and was liable for underpayment contraventions by various other entities (claim at [1]-[3]). The Applicant did not plead that the First Respondent was his employer.

Ratio Decidendi

Legal Principle Established

Ms Stuckey-Clarke draws attention to s.235(1) of the Migration Act 1958 (Cth), which sets out a strict liability offence. She also draws attention to s.245AG of the Migration Act, which has a very wide definition of “work”, not limited to contract. Ms Stuckey-Clarke submits that the act of work itself by a person in the Applicant’s situation is illegal, and any claim based upon that illegality would be void and unenforceable. Ms Stuckey-Clarke refers to Ghimire v Karriview Management Pty Limited and Sharma [2018] FCCA 2157; (2018) 336 FLR 153, in which Judge Lucev in turn reviews several of the authorities, and also the decision of Graham J in Hussein v Secretary of the Department of Immigration and Multicultural Affairs (No.2) [2006] FCA 1263; (2006) 155 FCR 304. Whilst both decisions concern the concept of “work” and the act of work and the provisions of s.235 of the Migration Act, however, I note that neither decision was directed to the question of enforceability of an award, which is what is relied on in the present case. I do not, for the purposes of today’s application, need to decide whether Ms Stuckey-Clarke’s submissions are made good in the context of the claim now purported to be brought by the Applicant. I note that Mr McArdle has assured me from the Bar table that the provisions of the Migration Act would not prevent the claims the Applicant seeks to bring for enforcement of the award. Suffice to say that I consider there are real difficulties in such a case being brought in the present circumstances, apart from the question whether s.235 of the Migration Act applies to the Applicant’s claim. In sum, I have concluded that it is appropriate to make orders as sought in [1] of the amended Application in a Case, striking out the ASOC. As the consequence of that strikeout, in the present circumstances it is appropriate that I make a second order that, pursuant to r.13.10 of the Rules, the proceeding against Ezy Mart Pty Limited and Saddam Magableh be summarily dismissed, as I am satisfied that the Applicant has no reasonable prospect of successfully prosecuting the proceeding. There are subsidiary orders that the First Respondent seeks. The matter of security for costs falls away. That leaves application for the directions in terms of paragraph 3 of the amended Application in a case, and the order sought in paragraph 4. I am not persuaded, in the present instance, that it is appropriate to make a direction under r.13.03(2) as permitting the Ezy Mart Respondents to make an application for costs more than 28 days after the proceeding was discontinued against them. Given that I have found that the claim as against the First Respondent is an abuse of process, it follows that I am persuaded it is appropriate to order costs to be paid pursuant to s.570(2)(a) of the Fair Work Act. Accordingly, I will make an order that the Applicant pay the First Respondent’s costs of the Application in a case, as sought in paragraphs [2] of the Application in a case.