Slattery v Canard Consolidated Pty Ltd (No 2)
[2023] FedCFamC2G 499
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Slattery v Canard Consolidated Pty Ltd (No 2) [2023] FedCFamC2G 499
File number(s): MLG 1636 of 2022 Judgment of: JUDGE SYMONS Date of judgment: 16 June 2023 Catchwords: PRACTICE AND PROCEDURE – application for leave under rule 11.02 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) to include a party to the proceeding – where applicant alleges that proposed party was “involved” in a contravention of the Fair Work Act 2009 (Cth) – no act or conduct positively asserted or identified that linked the proposed party to the contravention – no arguable case that the proposed party participated in or assented to the contravention – no arguable case that the proposed party had knowledge of the essential facts of the contravention - application dismissed Legislation: Fair Work Act 2009 (Cth) ss 340, 361, 550
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 1.04
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 rr 7.01, 11.02, 13.13
Cases cited: Bupa Australia Pty Ltd v iSelect (No 2) [2012] FCA 1277
Benjamin v Endeavour Industries Pty Ltd [2012] FMCA 488
Construction, Forestry, Maritime, Mining and Energy Union v Clarke (2007) 164 IR 299; [2007] FCAFC 87
Emwest Products Pty Ltd v Automotive Food, Metals, Engineering, Printing and Kindred Industries Union (2002) 117 FCR 588; [2002] FCA 61
EZY Accounting 123 Pty Ltd v Fair Work Ombudsman (2018) 360 ALR 261; [2018] FCAFC 134
Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365
Fair Work Ombudsman v Northcoast Security Services Group Pty Ltd & Anor [2016] FCCA 2499
Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346; [2015] FCAFC 37
Grant Lukies v S2V Consulting Pty Ltd (2018) 333 FLR 226; [2018] FCCA 1431
Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 154 IR 228; [2006] WASC 144
Sabapathy v Jetstar Airways (2021) 283 FCR 348; [2021] FCACF 25
Sienkiewicz (As Trustee for the Sienkiewicz Superannuation Fund) v Salisbury Group Pty Ltd [2013] FCA 977
Slattery v Canard Consolidated Pty Ltd [2023] FedCFamC2G 198
Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201
Yorke and Another v Lucas (1985) 158 CLR 661; [1985] HCA 65
Division: Division 2 General Federal Law Number of paragraphs: 46 Date of last submission/s: 26 April 2023 Date of hearing: 26 April 2023 Place: Melbourne Counsel for the Applicant: Mr D. Murphy Solicitor for the Applicant: Maurice Blackburn Lawyers First Respondent: Mr D. Dunn (Director) (with leave pursuant to r 9.04 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)) Second Respondent: In Person Third Respondent: Mr D. Dunn (Director) (with leave pursuant to r 9.04 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)) Counsel for the Proposed Fourth Respondent: Mr A. Denton Solicitor for the Proposed Fourth Respondent: HWL Ebsworth ORDERS
MLG 1636 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: CONNOR SLATTERY
Applicant
AND: CANARD CONSOLIDATED PTY LTD
First Respondent
DAVID DUNN
Second RespondentCANARD SOLUTIONS PTY LTD
Third Respondent
order made by:
JUDGE SYMONS
DATE OF ORDER:
16 June 2023
THE COURT ORDERS THAT:
1.The applicant’s application filed on 6 April 2023 be dismissed.
2.The proposed fourth respondent file and serve any application, affidavit and written submissions on the question of costs on or before 4pm on 14 July 2023.
3.The applicant file and serve any written submissions in reply on the question of costs, on or before 4pm on 11 August 2023.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE SYMONS:
INTRODUCTION
By an application filed on 6 April 2023, the applicant (Mr Slattery) seeks leave pursuant to r 11.02 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (the Rules) to include Christine Ann Dunn (Ms Dunn) as the fourth respondent to this proceeding. Ms Dunn opposes the application. Both Mr Slattery and Ms Dunn made submissions addressing their respective positions at a hearing held on 26 April 2023. None of the current named respondents wished to be heard on the application.
BACKGROUND
These proceedings were commenced by the applicant filing an originating application and statement of claim on 13 July 2022 which sought relief against the first respondent (Canard Consolidated) and the second respondent (Mr Dunn) related to alleged contraventions of the Fair Work Act 2009 (Cth) (FW Act) arising primarily from the termination of Mr Slattery’s employment. Relevant to this application, Mr Slattery alleges that he was dismissed by Canard Consolidated on 16 December 2021 in contravention of s 340(1) of the FW Act because he had and had exercised, workplace rights to make complaints and inquiries in relation to his employment.
On 16 March 2023 I made an order granting leave to Mr Slattery to include the third respondent (Canard Solutions) as a party to the proceeding and published reasons explaining my decision: Slattery v Canard Consolidated Pty Ltd [2023] FedCFamC2G 198 (earler decision). The earlier decision set out in some detail the nature of Mr Slattery’s substantive application and to that extent these reasons should be read with it.
THE APPLICANT’S CASE FOR JOINDER
Mr Slattery’s case acknowledges that as the first court date has passed, he requires leave to include Ms Dunn as a party (proposed fourth respondent) to the proceeding (r 11.02(2)). In making his application he relies upon an affidavit of lawyer Paul Sutton dated 27 January 2023 (the Sutton affidavit) and written submissions filed on 21 April 2023.
Mr Slattery alleges that Ms Dunn was “involved” within the meaning of s 550 of the FW Act in Canard Consolidated’s decision to dismiss him. Specifically he contends that Ms Dunn was “in any way, by act or omission, directly or indirectly, knowingly concerned in or party to” that decision, thereby engaging the language of s 550(2)(c) of the FW Act.
He submits that a person is “knowingly concerned” in a contravention where that person:
(a)is linked in purpose with the contravenor (referring to Construction, Forestry, Maritime, Mining and Energy Union v Clarke [2007] FCAFC 87 (Clarke));
(b)practically participates in, or assents to, the contravention (referring to EmWest Products Pty Ltd v Automotive Food, Metals, Engineering, Printing and Kindred Industries Union (2002) 117 FCR 588 (EmWest) at [34] and Clarke at [26]). The expression “concerned in” is of general import and covers a wide range of activities, including mere agreement with the conduct (referring to EmWest at [34] and Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 154 IR 228 at [29]); and
(c)has actual knowledge of the essential facts constituting the contravention (referring to Yorke and Another v Lucas (1985) 158 CLR 661 at 670).
Mr Slattery relies upon the following combination of facts to establish an arguable case for the involvement of Ms Dunn in the alleged contravention by Canard Consolidated of s 340(1) of the FW Act. These facts are said by Mr Slattery to be largely uncontroversial, including because in some cases they emerge from or are confirmed in the affidavit of Mr Dunn dated 1 February 2023:
·At the time of Mr Slattery’s dismissal, Ms Dunn was a director and 50 per cent shareholder of Canard Consolidated;
·At the time of Mr Slattery’s dismissal, Ms Dunn was a member of the executive of Canard Solutions and held out, online at least, as the head of client liaison of Canard Solutions;
·Between 2014 and 2020, Ms Dunn was the landlord of farm property leased by Canard Solutions;
·Along with her husband (the second respondent) Ms Dunn had funded Canard Consolidated and Canard Solutions through “various entities” and had decided, along with her husband to terminate funding of Canard Consolidated following receipt of Mr Slattery’s claim.[1]
·Ms Dunn was and remains a creditor of Canard Consolidated.[2]
[1] Relying on paragraphs 7 and 19 of the affidavit of David Dunn filed on 1 February 2023 (the Dunn affidavit).
[2] Refer Annexure “DD-3” to the Dunn affidavit.
Mr Slattery submits that these facts make clear that Ms Dunn was capable of making and did in fact make, important funding decisions about Canard Consolidated. He also characterises both Canard Consolidated and Canard Solutions as “small family-run businesses” with a small turnover which, in the case of Canard Solutions was controlled by an executive that comprised (at relevant times) of himself, Mr Dunn and Ms Dunn and sometimes the administration manager.[3] He notes, picking up the evidence of Mr Dunn, that he (Mr Slattery) was “a trusted member of the [Dunn] family” including in his capacity as General Manager of Canard Solutions Pty Ltd.[4]
[3] Refer paragraph 11(i) of the Sutton affidavit.
[4] Refer paragraph 17 of the Dunn affidavit.
Mr Slattery submits that it is arguable that there is an inferential case that a person in the position of Ms Dunn – who was personally, financially and professionally enmeshed in Canard Consolidated and Canard Solutions – would have known that Mr Slattery (an integral part of the Canard team, a member of the executive, her colleague and somebody Ms Dunn had worked with for a long period of time) was making complaints or inquiries in relation to his employment and was exercising workplace rights. It was submitted that there was an arguable case that Ms Dunn would have known that her husband (Mr Dunn) was going to dismiss Mr Slattery and that she shared in that purpose and assented to that decision.
Mr Slattery further submits that this inferential case is made stronger having regard to the reason offered by Mr Dunn for his termination, being that it was for misleading and deceptive conduct (which Mr Dunn described as serious misconduct). Mr Slattery submits that it could not sensibly be contended that Ms Dunn was ignorant to and/or did not participate in his dismissal when it had those purported characteristics, and he was performing the important role of General Manager of Canard Solutions.
Mr Slattery also relied upon an email that had been sent by Mr Dunn to Mr Slattery on 21 December 2021, this being five days after notice of termination was given, and in which Mr Dunn made statements that included: “As you know, Christine and I have treated you as part of our family for almost our entire life” and “Christine and I – who both have a substantial vested interest in both you and the company, do not want to ‘go to war’”.[5]
[5] Annexure “PS-10” to the Sutton affidavit.
Mr Slattery submitted that the email provided further support for the inference that Ms Dunn supported Mr Dunn’s decision to terminate his employment and that she was linked in purpose with Canard Consolidated and to that extent, participated in the decision.
As far as the purpose of the joinder was a factor to be taken into account, Mr Slattery identified that there were questions about the ability of either corporate respondent to meet any judgment debt if he was to enjoy success in the proceeding.
MS DUNN’S CASE IN OPPOSITION TO HER INCLUSION AS A PARTY IN THE PROCEEDING
Ms Dunn submitted that Mr Slattery’s proposed claim against her was hopeless and enjoyed no prospects of succeeding. This submission was responsive to Mr Slattery’s written submissions and to a proposed amendment to the pleadings that had been sent by Mr Slattery’s lawyer to the lawyers representing Ms Dunn. The proposed amended pleading was provided by Ms Dunn to the Court with the knowledge (although not agreement) of Mr Slattery.
In order to understand how Ms Dunn’s case is put, it is necessary to set out those parts of the proposed amended statement of claim that relate to her. They are as follows:
2B The Fourth Respondent (Ms Dunn) was:
(a)from 11 February 2011 to 11 January 2022, a director of Canard Consolidated;
(b)at all material times, a shareholder of Canard Consolidated;
(c)from 24 February 2018 and ongoing, held out in the position of Head of Client Liaison for Canard Solutions;
(d)at all material times, a member of the executive team at Canard Solutions;
(e)from an unknown date until early 2022, the lessor of a property to Canard Consolidated; and
(f)at all material times, a person who was empowered to make, and did make, funding decisions in respect of Canard Consolidated and Canard Solutions.
Particulars
As to sub-paragraph (a), Ms Dunn and Mr Dunn were in that period the only two directors of Canard Consolidated.
As to sub-paragraph (b), Ms Dunn and Mr Dunn were at all material times the only two shareholders of Canard Consolidated.
As to sub-paragraph (c), Ms Dunn was and is referred to as the Head of Client Liaison at Canard Solutions’ website, to sub-paragraph (d), the executive team comprised Mr Dunn, Ms Dunn and Slattery until Slattery’s dismissal as pleaded below at paragraph 32.
As to sub-paragraph (e) and (f), see paragraphs 6, 7, 19 and 21 of the affidavit of David Dunn dated 1 February 2023. A copy of this affidavit can be inspected on request at the offices of Maurice Blackburn Lawyers.
…
Accessorial liability of Ms Dunn
56E Ms Dunn:
(a)participated in and assented to the Dismissal; and
(b)had knowledge of some or all of the matters pleaded at paragraphs 6, 7, 21, 22(a), 22(b), 24, 26, 29(b), 31 and 32.
Particulars
Ms Dunn’s participation in and assent to the Dismissal, and knowledge, is to be inferred from the following facts:
1.at all material times including at the time of the Dismissal, Ms Dunn was:
a.along with Mr Dunn, one of two directors of Canard Consolidated, as pleaded at paragraph 2B above;
b. a shareholder of Canard Consolidated;
c. the lessor of a property to Canard Consolidated;
d.a person who was empowered to make, and did make, funding decisions in respect of Canard Consolidated and Canard Solutions;
e. a member of the executive team at Canard Solutions.
2.From 24 February 2018 and ongoing, was held out in the position of Head of Client Liaison for Canard Solutions, as pleaded above at paragraph 2B(c).
3.The Dismissal was a highly significant decision for both the businesses of Canard Consolidated and Canard Solutions, in circumstances where:
a.Slattery was one of only two managerial level employees, as pleaded above at paragraph 3(e);
b.Slattery was a member of the executive team at Canard Solutions, as pleaded above at paragraph 3(d);
c.Canard Consolidated and Canard Solutions were small business employers within the meaning of section 23 of the Act, as pleaded above at paragraphs 1(d) and 2A(b) respectively.
56FBy reason of the matter pleaded at paragraph 56E, Ms Dunn was, within the meaning of s 550(2)(c), a person involved in the Dismissal in that she was by her actions, directly or indirectly, knowingly concerned in or party to the Dismissal.
56GBy reason of the matters pleaded in paragraphs 56E to 56F above, Ms Dunn is deemed by operation of s 550 to have contravened s 340 of the FW Act.
Ms Dunn submitted that the proposed pleading and the claim against her was deficient in that it:
(a)Erroneously sought to establish that Ms Dunn was “concerned in” the alleged contravention on the basis that she had agreed with the conduct. It was submitted that Mr Slattery’s reliance on the decision of Kenny J in Emwest was, in this context, misplaced. That decision (it was said) concerned a different provision of the Workplace Relations Act 1996 (Cth) and not s 550 of the FW Act;
(b)Involved the assertion that Ms Dunn had actual knowledge of the essential facts constituting the contravention without first identifying the material facts to support the assertion;
(c)Identified a series of circumstances, none of which could positively establish that Ms Dunn was involved in, in any way, any employment decision relating to Mr Slattery, including a decision to dismiss him. In particular, the only action relied upon by Mr Slattery, being the decision by Ms Dunn and “companies in our group” to terminate funding of Canard Consolidated and to terminate the farm lease[6] was action that occurred well after Mr Slattery’s dismissal;
(d)Insofar as it pleaded at paragraph 56E(b) that Ms Dunn had some knowledge of some or all of the various matters pleaded in certain paragraphs of the statement of claim, those paragraphs were largely the complaints and inquiries alleged to have been contained within communications passing exclusively between Mr Slattery and Mr Dunn;
(e)Paragraph 56E was essentially a submission or statement without material facts and was liable to be struck out. The proposed pleading against Ms Dunn (as a whole) was incapable of being cured by amendment;
(f)Failed to articulate how Ms Dunn was alleged to have implicated herself in the conduct; the high watermark of the case against Ms Dunn was that because the dismissal was a “highly significant decision” it could be inferred that Ms Dunn had knowledge of the impugned conduct.
[6] As described in paragraph [19] of the Dunn affidavit.
In support of her argument, Ms Dunn referred the Court to the decision of a Full Court of the Federal Court in EZY Accounting 123 Pty Ltd v Fair Work Ombudsman (2018) 360 ALR 261 (EZY Accounting) where at [11] the Court highlighted a distinction between sections 550(2)(a) and 550(2)(c) of the FW Act by endorsing the reasoning of White J in Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365 where at [178] his Honour said (internal citations omitted):
The notion of being “knowingly concerned” in a contravention has a different emphasis from that of aiding, abetting, counselling or procuring” a contravention. To be knowingly concerned in a contravention, the person must have engaged in some act or conduct which “implicates or involves him or her” in the contravention so that there be a “practical connection between” the person and the contravention…
Ms Dunn also referred the Court to [13] of EZY Accounting where it was observed that:
To be “involved in” conduct there has to be some conduct which “implicates” a person in the offending conduct such that they become “involved in” or “associated with” that conduct: Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833 at [116]. It was said there that a person cannot be “involved in” conduct for the purposes of s 550 “merely by reason of his knowledge of the conduct being pursued”.
It was submitted by Ms Dunn that it was important when assessing the merits of Mr Slattery’s proposed case against her to bear in mind that s 361 of the FW Act (colloquially referred to as “the reverse onus provision”) did not apply to claims for accessorial liability under s 550 of the FW Act with the result that there was no onus on Ms Dunn to do anything in the proceeding. Indeed, she would be entitled to invoke the penalty privilege should she choose to do so. Mr Slattery’s case would therefore rise and fall on what was articulated by way of pleadings and adduced by way of evidence.
It was also submitted by Ms Dunn that where “state of mind” was an element of the primary contravention, she could not be an accessory to that contravention unless she also possessed that same “state of mind” or required knowledge. She cited in support of this proposition the majority reasoning of North and Bromberg JJ in Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 at [267] where their Honours observed:
[267]The need to establish an accessory’s knowledge of the primary contravener’s state of mind in an adverse action claim brought under s 340(1) of the FW Act, in which the contravener’s motive is an essential element of the contravention was considered by Bromberg J in Construction, Forestry, Mining and Energy Union v McCorkell Constructions Pty Ltd (2013) 232 IR 290 at [288]-[290], in a passage not dealt with subsequently in the reasons of the Full Court that considered that judgment. His Honour said:
[288]The CFMEU contended that whilst it is necessary to prove that the accessory knew what the principal contravener was doing, an accessory cannot know what the other person is feeling or thinking. It argued that whilst it was necessary for an accessory to have knowledge of the essential elements of a contravention, it was not necessary for an accessory to have knowledge of the principal contravener’s motive for the contravention.
[289]That submission must be wrong where a particular motive is a necessary element of the contravention. For instance, a person who assisted in the dismissal of an employee carried out by a contravener because of the employee’s race, could not be an accessory to the discriminatory conduct in the absence of having assisted knowing that the contravener’s conduct was motivated by race. Without the knowledge, it could not be said that the alleged accessory is “linked in purpose with the perpetrators”.
[290]An accessory will often know the principal perpetrator’s motive because the perpetrator will have revealed it. Alternatively, an accessory may know the perpetrator’s motive because their conduct is so intertwined, that the motive of one will be the obvious motive of the other.
In submissions in reply, counsel for Mr Slattery accepted that insofar as the challenge made by Ms Dunn operated on the proposed amended statement claim she made some valid points which would be addressed in the re-drafting exercise. However, counsel noted that the joinder application was not pursued on the strength of, or by reference to, that proposed pleading (which had not been filed). He submitted instead that the proper inquiry was to ask whether it was arguable, based on the uncontested facts that were before the Court, that Ms Dunn was involved in Canard Consolidated’s alleged contravention of the FW Act.
Mr Slattery was critical of what he described as the “artificial approach” adopted by Ms Dunn to his proposed case and pleading. He submitted that the collection of facts that he relied upon should be considered together as a “package” and evaluated from the point of view of determining whether it was at least arguable that there was an inferential case that Ms Dunn had practically participated in the impugned conduct and had the requisite knowledge. Counsel maintained his reliance on the decision of Emwest and the case of Clarke which at [26] had referred to the passage relied on from Emwest.
CONSIDERATION
Joinder principles
Rule 11.02 of the Rules does not speak in terms of “joinder” but instead contemplates that a party may “include” another person as a party.
It states:
(1)A party to a proceeding may include any person as a party by:
(a)naming the person as a party in the application, response or reply; and
(b)serving on the person a copy of the application, response or reply and all other relevant documents filed in the proceeding.
(2)A party must not include a person as a party after the first court date without the leave of the Court.
(3)The Court may at any time order a party who has included a person as a party to file and serve on each other party to the proceeding an affidavit setting out the basis on which the person has been included.
Rule 11.02, which is less prescriptive than its counterpart provision in the Federal Court Rules 2011 (Cth), is understood to provide this Court with an unfettered discretion to grant leave to join a party which should be exercised judicially and having regard to all the circumstances of the case.[7]
[7] Benjamin v Endeavour Industries Pty Ltd [2012] FMCA 488 (Endeavour Industries) at [15]
It has been recognised that r 11.02 is sufficiently wide to include circumstances provided for in the rules of other courts for the joinder of parties who are not necessary parties. However, deference to any such rules should not come at the expense of the objects of the Federal Circuit and Family Court of Australia Act 2021 (Cth) or the overarching purpose of the Rules (refer r 1.04). One such set of circumstances would be where all rights of relief that are claimed against the person that is sought to be joined arise out of the same transaction or event or series of events that give rise to the claims for relief the person seeking the joinder has against an existing party.[8]
[8] Fair Work Ombudsman v Northcoast Security Services Group Pty Ltd & Anor [2016] FCCA 2499 at [8].
The considerations that might be relevant to the determination of an application for leave to join a respondent to a proceeding will include: (a) the purpose of the joinder; (b) any delay in making the application for the joinder and the explanation for the delay; and (c) whether any relevant period of limitation has passed.[9]
[9] Endeavour Industries at [16].
Ordinarily, an applicant for joinder must show an arguable case against the parties proposed to be joined, at least to the standard of being able to resist an application for summary judgment.[10]
[10] Bupa Australia Pty Ltd v iSelect (No 2) [2012] FCA 1277 at [23]; see also Sienkiewicz (As Trustee for the Sienkiewicz Superannuation Fund) v Salisbury Group Pty Ltd [2013] FCA 977 at [38].
Section 550 of the FW Act
Section 550 of the FW Act provides:
Involvement in contravention treated in same way as actual contravention
(1)A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.
(2)A person is involved in a contravention of a civil remedy provision if, and only if, the person:
(a) has aided, abetted, counselled or procured the contravention; or
(b)has induced the contravention, whether by threats or promises or otherwise;
(c)has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d) has conspired with others to effect the contravention.
In the decision of Grant Lukies v S2V Consulting Pty Ltd [2018] FCCA 1431, Judge Lucev at [16] noted in respect of s 550 that it did not say who should be a party to an action and it certainly did not mandate that every person alleged to be accessorily liable at any stage of proceedings be made a party to those proceedings. His Honour did however acknowledge that it was a legislative provision which was a factor to be considered when determining whether a person should be named as a party, or joined as a party, and a factor which suggests that if otherwise appropriate, a person who is arguably accessorily liable for contravening conduct ought to be joined as a party.
As far as s 550(2)(c) is concerned, the cases emphasise that an allegation that a person was “knowingly involved” in a FW Act contravention and thus liable as an accessory under s 550 of the FW Act must be pleaded very carefully. Illustrative of this approach, Justice Thawley stated in Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201 at [29] (internal citations removed):
A pleading that a person is “knowingly concerned” in a contravention is a serious one, akin to a pleading of dishonesty…it should plead the material facts said to establish that the person was knowingly concerned in the contravention. This includes an express identification of the elements of the contravention and an express pleading that the person had knowledge of each of the essential elements constituting the contravention. It should identify the material facts said to establish knowledge or from which such knowledge is to be inferred. The pleading should generally also identify the material facts said to constitute the relevant acts or omissions of the person which are relied upon as establishing any practical connection with or link to the contraventions which are contended to establish the person was “knowingly concerned” within the meaning of s 550(2)(c).
Also relevant to the case that the applicant seeks to prosecute against Ms Dunn are the observations of a Full Court of the Federal Court in Sabapathy v Jetstar Airways [2021] FCAFC 25 where at [29] Logan, Flick and Katzmann JJ said:
One of the essential elements of the cause of action under s 340 was that Jetstar terminated Mr Sabapathy’s employment because he had made one or more of the relevant complaints or inquiries about his workplace rights. Actual knowledge of the “essential matters” which go to make up the events is an essential element of a cause of action based on s 550. That meant that it was a material fact and had to be pleaded. Yet nowhere in the amended statement of claim is it pleaded that any of the nine pilots alleged to be accessories to Jetstar’s contravention had actual knowledge that Jetstar terminated Mr Sabapathy’s employment for the reason he alleged.
CONSIDERATION
Although Ms Dunn was critical of the length of time it took for Mr Slattery to prosecute his application for leave to include her as a party in the proceeding, her principal complaint was directed at the viability of the cause of action that he proposed to bring against her. As noted above, the argument was made by reference to an amended statement of claim that was provided in draft to Ms Dunn’s lawyers and upon which Mr Slattery eschewed reliance for the purpose of his joinder application.
While I acknowledge that the application before me is not one made under r 7.01 of the Rules to amend a document, namely the statement of claim filed on 13 July 2022, and that in the event that leave was granted to include Ms Dunn, Mr Slattery would likely make some drafting changes to the document that was provided to Ms Dunn’s lawyers, I do not consider that the proposed statement of claim is a document that I should exclude from consideration. Indeed, I did not understand Mr Slattery to advocate for this course but rather that it should be understood in its proper context.
That context, it seems to me, is that it provides some insight as to the way Mr Slattery conceptualises his claim against Ms Dunn and identifies the material facts which he says go to establishing his admittedly wholly inferential case that Ms Dunn was an accessory to the alleged contravention by Canard Consolidated of s 340(1) of the FW Act. The circumstances identified by Mr Slattery in his written and oral submissions as giving rise to that inferential case mirrored those identified in paragraph 56E of the proposed amended statement of claim, which was the subject of strident criticism from Ms Dunn.
As will be recalled, Ms Dunn argued that the case articulated against her was so lacking in merit that it did not rise to the threshold of enjoying any prospect of success; as a result, it would not survive an application that it be summarily dismissed.[11] If Ms Dunn is correct in her assessment, then it would be contrary to the overarching purpose of the Rules and the Act as well as the principles that concern the inclusion of parties, that Mr Slattery be granted leave to include Ms Dunn as a party to the proceeding.
[11] Pursuant to r 13.13 (a) of the Rules, the Court may order that a proceeding be dismissed generally or in relation to any claim for relief in the proceeding if the Court is satisfied that the party prosecuting the claim for relief has no reasonable prospect of successfully prosecuting the proceeding or claim.
In evaluating the proposed claim against Ms Dunn, I have taken into consideration that the proceedings, despite being commenced in July 2022, have not progressed beyond the exchange of pleadings between Mr Slattery and the first and second respondents. That means that I cannot discount the possibility that further information germane to the case to be assembled against Ms Dunn might come to light, especially through any discovery. I must also proceed on the basis that a claim of accessorial liability may ultimately succeed notwithstanding it relies on the decision-maker drawing inferences that the alleged accessory had knowledge of the proscribed motive or reason for the impugned conduct. I am also prepared to accept, although the position is less clear, that an inferential case could be made with respect to establishing that a person engaged in the relevant act or omission relied upon as establishing the practical connection or link to the contravention.
The difficulty here is more fundamental. In particular, I am not persuaded that Mr Slattery has identified (or for that matter, pleaded) the material facts or circumstances sufficient to establish an arguable case that Ms Dunn through act or omission had a practical connection with or link to the alleged contravention.
It is submitted by Mr Slattery that the requisite relationship arises through the confluence of the positions held by Ms Dunn in each of Canard Consolidated and Canard Solutions, the character of each business as a “small family-run business” and the ability of Ms Dunn to make decisions about the funding of each entity, as well as the significance of the decision to dismiss Mr Slattery having regard to his position within this organisational and family-centric structure. However, apart from the suggestion that Ms Dunn participated in and assented to the dismissal no act or conduct is positively asserted or identified that links Ms Dunn to the contravention.
While the decision of Clarke contains an acknowledgement that an accessory may be implicated or involved in a contravention through their participation in or assent to such contravention that does not, in my opinion, relieve an applicant from identifying the basis upon which such participation or assent is said to arise. The collection of matters identified by Mr Slattery do not, in my view, establish an arguable case that Ms Dunn was implicated or involved in either of the two ways ascribed to her.
As far as the concept of assent is concerned, I do not accept that it is established merely by reason of knowledge of the conduct pursued. Instead, consistent with authority that emphasises that an accessory will have engaged in a specified act or conduct it connotes a positive and deliberate act.
This meaning is also consonant with the definition of “assent” contained in the Online Macquarie Dictionary (2023) which provides:
verb (i)1. (sometimes followed by to) to agree by expressing acquiescence or admitting truth; express agreement or concurrence: to assent to a statement.
The facts and circumstances identified by Mr Slattery do not establish that Ms Dunn expressed her agreement or concurrence to the decision taken by Canard Consolidated to terminate Mr Slattery’s employment. While it is the case that Ms Dunn enjoyed at relevant times the status of company director and shareholder of the employing entity and sat on the executive of Canard Solutions alongside Mr Slattery, these circumstances say nothing about Ms Dunn’s proximity to the matters at the heart of the contravention, including whether her work responsibilities in the positions and roles that she occupied trespassed on employment matters and/or that she was the controlling mind of Canard Consolidated. In this respect, the case against Ms Dunn can be distinguished from that which was made in support of the successful application by Mr Slattery to include Canard Solutions as a party.
Furthermore, I am not persuaded that Mr Slattery has identified an arguable case that Ms Dunn had knowledge of the proscribed reason attributed to Canard Consolidated for its decision to dismiss him.
There is nothing linking the communication of the complaints and/or inquiries to Ms Dunn. Indeed, on the facts and circumstances identified by Mr Slattery – being that the reason offered by Mr Dunn for his termination was that he engaged in misleading and deceptive conduct – the more likely inference is that Ms Dunn understood that the dismissal was motivated by this more benign (or at least non-proscribed) reason.
In these circumstances, the application to include Ms Dunn as a party to the proceeding must be dismissed.
I certify that the preceding forty-six (46) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Symons . Associate:
Dated: 16 June 2023
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