United Voice v Secom Australia Pty Ltd
[2015] FCCA 2358
•31 August 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| UNITED VOICE v SECOM AUSTRALIA PTY LTD & ANOR | [2015] FCCA 2358 |
| Catchwords: INDUSTRIAL LAW – Summary dismissal application – claims of underpayment of wages and failure to produce documents by security company – very poorly conducted case by union with little attention to detail which led to significant waste of court resources – further questions of standing of union raised – question of tactical considerations by union as opposed to whether litigation in the best interests of members – further time given to union to provide proper information regarding calculation of underpayments – other parts of amended statement of claim struck out – limited issues and no-complex questions of fact – partial award of costs. |
| Legislation: Fair Work Act 2009, ss.481, 482(1), 483(1), 483(4), 483AA , 503(1), 512, 518, 539(2), 540(2), 550, 570(2)(a) Fair Work (Transitional and Consequential Provisions) Act 2009, item 2(3) of Schedule 3; item 40 of Schedule 16 |
| Adnunat Pty Ltd v ITW Construction Systems Australia Pty Ltd [2009] FCA 499 Batistatos v Roads and Traffic Authority (NSW) (2006) 226 CLR 256 Boston Commercial Services Pty Ltd v GE Finance Australasia Pty Ltd (2006) 236 ALR 720 Helal v McConnell Dowell Constructors (Aust) Pty Ltd [2010] FCA 1462 Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd (2008) 167 FCR 372 J. Levingston, The Law of Affidavits (Sydney: The Federation Press, 2013) |
| Applicant: | UNITED VOICE |
| First Respondent: | SECOM AUSTRALIA PTY LTD |
| Second Respondent: | MARK IZZARD |
| File Number: | CAG 70 of 2014 |
| Judgment of: | Judge Neville |
| Hearing date: | 17 April 2015 |
| Date of Last Submission: | 22 May 2015 |
| Delivered at: | Canberra |
| Delivered on: | 31 August 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr Fagir |
| Solicitors for the Applicant: | [United Voice; by leave] |
| Solicitor/Advocate for the First & Second Respondents: | Mr McDonald |
| Solicitors for the First & Second Respondents: | Moray & Agnew, Sydney |
ORDERS
Limited to the issue of the standing of the Applicant, the summary dismissal Application is dismissed;
In relation to the challenge to the claim regarding the underpayment of wages:
(a)within 7 days of the date of these orders, the Union is to provide to Secom’s lawyer the calculations and all relevant details to explain and to substantiate the underpayments alleged in the Amended Statement of Claim;
(b)the information provided by the Union to Secom’s lawyer (as per Order 2(a)) is to be provided in an affidavit;
(c)if the requisite information is provided in full and within the time frame and manner specified, the parties are to attend mediation with a Registrar on a date and time to be arranged with the Registry of the Court, and the matter be adjourned to the list on 30th November 2015 at 9:30am;
(d)absent the information referred to in Order 2(a) being provided in full and within the time and manner specified, those parts of the Amended Statement of Claim that relate to “underpayment” (pars.8 – 11 inclusive) be struck out, and the costs of this part of the Application be paid by the Union to the Respondents on an indemnity basis.
Part C of the Amended Statement of Claim (pars.12 – 25 inclusive) be struck out. Costs of this part of the summary dismissal Application be paid by the Applicant to the Respondents, either as agreed or taxed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT CANBERRA |
CAG 70 of 2014
| UNITED VOICE |
Applicant
And
| SECOM AUSTRALIA PTY LTD |
First Respondent
| MARK IZZARD |
Second Respondent
REASONS FOR JUDGMENT
Introduction
By an Application in a Case, filed 14th January 2015, the Respondents seek orders, in the alternative, that (a) the Applicant’s Amended Statement of Claim (filed 12th December 2014) be set aside either in whole or in part, and/or (b) the claim be summarily dismissed, pursuant to Rule 13.10(a) of this Court’s Rules. Further in the alternative, the Respondents seek that certain, specified paragraphs in the Amended Statement of Claim be struck out. The Respondents also seek an order for costs against the Applicant.
The grounds for summary dismissal are that:
(a)the Applicant has no reasonable prospect of successfully prosecuting the claim (Rule 13.10(a);
(b)the Applicant has brought a frivolous and vexatious claim, pursuant to Rule 13.10(b); and
(c)the claim is an abuse of process of the Court, pursuant to Rule 13.10(c)
Leaving to one side for the moment (a) the Applicant’s failure to obtain leave of the Court to add a further sixteen parties (Applicants), and (b) the Applicant’s presumption regarding the Court granting leave, after the event, to add the said additional 16 Applicants,[1] in its latest iteration, the Amended Statement of Claim contends that there have been a series of under-payments of wages to a number of current and former employees of the First Respondent, and that certain documents have not been produced.
[1] See the Applicant’s letter to the First Respondent, dated 15 January 2014 [sic – it obviously should have been dated 15 January 2015], annexure SRU 3 to the affidavit of Mr Russell-Uren, filed 19th February 2015.
On the face of it these are very discrete claims, and matters that are not (or should not be) very complex, either as to law or facts. This is so also in relation to one of the more remarkable claims by the Union, namely that one of its members worked 125 hours per week for three months. This would amount to worker, over a seven day period, in excess of 17 hours each day. Upon checking with the Union as to the member’s identity, Secom checked its records and confirmed that the worker in question had not worked more than 41.5 hours each week. The Union never addressed Secom’s response according to its records and sworn evidence challenging the extravagant claim of 125 hours per week.
An issue also was ventilated regarding the standing of the Union to bring the claim, which was linked to the Union’s attempt to join an additional 16 Applicants – without the requisite leave of the Court pursuant to Rule 11.02(2) of this Court’s Rules, as I have said.
These reasons proceed as follows: (a) outline of principle, (b) procedural history, outline of the claims, defence and cross-claims, (c) outline of evidence, (d) submissions on each of the discrete issues, (e) consideration and disposition.
Summary Dismissal: Outline of Principle
In Three Rivers District Council v Governor and Company of the Bank of England (No.3) (“Three Rivers”),[2] which was cited with obvious approval by French CJ and Gummow J in their joint judgment in Spencer v Commonwealth,[3] Lord Hope said (internal citations omitted; emphasis added):
The method by which issues of fact are tried in our courts is well settled. After the normal processes of discovery and interrogatories have been completed, the parties are allowed to lead their evidence so that the trial judge can determine where the truth lies in the light of that evidence. To that rule there are some well-recognised exceptions. For example, it may be clear as a matter of law at the outset that even if a party were to succeed in proving all the facts that he offers to prove he will not be entitled to the remedy that he seeks. In that event a trial of the facts would be a waste of time and money, and it is proper that the action should be taken out of court as soon as possible. In other cases it may be possible to say with confidence before trial that the factual basis for the claim is fanciful because it is entirely without substance. It may be clear beyond question that the statement of facts is contradicted by all the documents or other material on which it is based. The simpler the case the easier it is likely to be to take that view and resort to what is properly called summary judgment. But more complex cases are unlikely to be capable of being resolved in that way without conducting a mini-trial on the documents without discovery and without oral evidence. As Lord Woolf said in Swain v Hillman, ... that is not the object of the rule. It is designed to deal with cases that are not fit for trial at all.
[2] [2003] 2 AC 1 at p.260-261 [95].
[3] (2010) 241 CLR 118 at pp.130 & 132 [21] & [26].
More summarily stated, Lord Hope may be taken, among other things, to distinguish between complex cases (e.g. as to matters of law, procedure and or facts) in contrast to necessary detail that is the warp and woof of litigation more generally.
The statutory basis upon which the Court exercises its power in relation to summary judgment is located in s.17A of the Federal Circuit Court of Australia Act1999. That section provides:[4]
[4] S.17A of the Federal Circuit of Australia Act 1999 mirrors s.31A of the Federal Court of Australia Act 1976.
(1) The Federal Circuit Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a) the first party is prosecuting the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully defending the proceeding or that part of the proceeding.
(2) The Federal Circuit Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a) the first party is defending the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.
(3) For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a) hopeless; or
(b) bound to fail;
for it to have no reasonable prospect of success.
(4) This section does not limit any powers that the Federal Circuit Court has apart from this section.
Rule 13.10 of this Court’s Rules also relevantly provides as follows:[5]
The Court may order that a proceeding be stayed, or dismissed generally or in relation to any claim for relief in the proceeding, if the Court is satisfied that:
(a) the party prosecuting the proceeding or claim for relief has no reasonable prospect of successfully prosecuting the proceeding or claim; …
[5] This Rule also provides for the summary dismissal of matters where they are considered to be frivolous or vexatious (Rule 13.10(b)), or an abuse of process (Rule 13.10(c)).
In Spencer v Commonwealth, the plurality judgment of Hayne, Crennan, Kiefel and Bell JJ said, at [56]:
Because s 31A(3) provides that certainty of failure (“hopeless” or “bound to fail”) need not be demonstrated in order to show that a plaintiff has no reasonable prospect of prosecuting an action, it is evident that s 31A is to be understood as requiring a different enquiry from that which had to be made under earlier procedural regimes. It follows, of course, that it is dangerous to seek to elucidate the meaning of the statutory expression “no reasonable prospect of successfully prosecuting the proceeding” by reference to what is said in those earlier cases.
And at [58] – [60], the plurality commented (internal citations omitted):
[58] How then should the expression “no reasonable prospect” be understood? No paraphrase of the expression can be adopted as a sufficient explanation of its operation, let alone definition of its content. Nor can the expression usefully be understood by the creation of some antinomy intended to capture most or all of the cases in which it cannot be said that there is “no reasonable prospect”. The judicial creation of a lexicon of words or phrases intended to capture the operation of a particular statutory phrase like “no reasonable prospect” is to be avoided. Consideration of the difficulties that bedevilled the proviso to common form criminal appeal statutes, as a result of judicial glossing of the relevant statutory expression, provides the clearest example of the dangers that attend any such attempt.
[59] In many cases where a plaintiff has no reasonable prospect of prosecuting a proceeding, the proceeding could be described (with or without the addition of intensifying epithets like “clearly”, “manifestly” or “obviously”) as “frivolous”, “untenable”, “groundless” or “faulty”. But none of those expressions (alone or in combination) should be understood as providing a sufficient chart of the metes and bounds of the power given by s 31A. Nor can the content of the word “reasonable”, in the phrase “no reasonable prospect”, be sufficiently, let alone completely, illuminated by drawing some contrast with what would be a “frivolous”, “untenable”, “groundless” or “faulty” claim.
[60] Rather, full weight must be given to the expression as a whole. The Federal Court may exercise power under s 31A if, and only if, satisfied that there is “no reasonable prospect” of success. Of course, it may readily be accepted that the power to dismiss an action summarily is not to be exercised lightly. But the elucidation of what amounts to “no reasonable prospect” can best proceed in the same way as content has been given, through a succession of decided cases, to other generally expressed statutory phrases, such as the phrase “just and equitable” when it is used to identify a ground for winding up a company. At this point in the development of the understanding of the expression and its application, it is sufficient, but important, to emphasise that the evident legislative purpose revealed by the text of the provision will be defeated if its application is read as confined to cases of a kind which fell within earlier, different, procedural regimes.
Subject to more recent guidance from the High Court and the Federal Court, it is convenient to note here the following cases which otherwise, respectfully, provide a convenient and helpful touchstone for the applications currently before the Court. Thus: White Industries Australia Ltd v Federal Commissioner of Taxation, Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd, and the Full Court decision in Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd.[6]
[6] White Industries Australia Ltd v Federal Commissioner of Taxation (2007) 160 FCR 298 (Lindgren J), Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd (2006) 236 ALR 720 (Rares J), and the Full Court decision in Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd (2008) 167 FCR 372 (Finkelstein, Rares & Gordon JJ). In the latter case, see especially the six principles set out by Gordon J at [123] – [134]. I am also conscious of Finkelstein J’s more recent helpful, and direct, discussion of Jefferson Ford in Imobilari Pty Ltd v Opes Prime Stockbroking Ltd (2008) 252 ALR 41. See his “dialogue”, especially at [7] – [9], of the distinction between summary judgment and strike out applications. In a non-statutory context, see also the principles set out by Kirby J in Lindon v Commonwealth of Australia (No 2) (1996) 136 ALR 251 at [14]. A number of these cases have most recently been considered and applied by the Full Court of the Federal Court in C v Commonwealth of Australia [2015] FCAFC 113 at [56] – [59].
It is helpful to note also the summary of principle by Sundberg J in Adnunat Pty Ltd v ITW Construction Systems Australia Pty Ltd.[7] At [37], his Honour said (emphasis added):
[37] In applying s 31A, the court does not conduct fact finding but must assess the strength of the allegations made by reference to the pleadings, affidavits and any other evidence adduced, in order to determine whether the claim is sufficiently strong to warrant a trial: see Jefferson Ford 167 FCR at [23] (Finkelstein J), [74] (Rares J) and [130] (Gordon J); see also Bradken Resources Pty Ltd v Lynx Engineering Consultants Pty Ltd [2008] FCA 1257 at [28] (Emmett J); Imobilari Pty Ltd v Opes Prime Stockbroking Ltd [2008] FCA 1920 at [6] (Finkelstein J). Ultimately, the court must consider whether there are any real, as opposed to fanciful, issues of fact or law that require proper determination at a trial.
o In assessing whether there are reasonable prospects of success, the court should draw all reasonable inferences (but only reasonable inferences) in favour of the non-moving party: see Jefferson Ford 167 FCR at [132] (Gordon J). Moreover, where the evidence on a summary judgment application is of an ambivalent character, there will be a real issue of fact and therefore reasonable prospects of success for the purposes of s 31A: see Boston 236 ALR at [45]; Jefferson Ford 167 FCR at [73] (Rares J) and [130] (Gordon J).
o The moving party bears the onus of persuading the court that its opponent has no reasonable prospects of success: see Jefferson Ford 167 FCR at [127] (Gordon J); Boston 236 ALR at [45]. However, where the moving party establishes a prima facie case for summary judgment, the opposing party must be able to point to “specific factual or evidentiary disputes that make a trial necessary”: see Jefferson Ford 167 FCR at [127] (Gordon J).
o As s 31A requires in effect a prediction as to the outcome of a claim, the court should be more reluctant to summarily dismiss a claim where real questions of fact and credit arise. In those cases, the court will not have all material evidence before it until trial, the credit of important witnesses will not have been tested and it will as a consequence be very difficult if not impossible to fairly assess the prospects of the claim: see Jefferson Ford 167 FCR at [20] (Finkelstein J); Dandaven v Harbeth Holdings Pty Ltd [2008] FCA 955 at [6] (Gilmour J).
[7] [2009] FCA 499. Much of the summary of principle here was set out in an earlier judgment of this Court: Amalgamated Commercial Holdings Pty Ltd v Compas Pty Ltd & Anor (2011) 203 IR 411.
Sundberg J’s remarks have been endorsed in subsequent cases, some of which are post the High Court judgment in Spencer v Commonwealth (noted below). Thus: Kenny J in Deputy Commissioner of Taxation v Southgate Investments Funds Limited, and Ryan J in Helal v McConnell Dowell Constructors (Aust) Pty Ltd.[8]
[8] Respectively, [2010] FCA 1298 at [22], and [2010] FCA 1462 at [12]. See also the comments of Bennett J in Australian Competition and Consumer Commission and Another v Link Solutions Pty Ltd (CAN 126 049 214) and Others (No 2) [2010] FCA 919, and by Gleeson J in Geneva Laboratories Ltd v Nguyen (t/as Health Line Pharmacy Sydney (2015) 110 IPR 295.
Further, in Spencer v Commonwealth, French CJ and Gummow J said, at [24]: “The exercise of powers to summarily terminate proceedings must always be attended with caution.” Their Honours further advised, at [25] – [26] (internal citations omitted):[9]
[25] Section 31A(2) requires a practical judgment by the Federal Court as to whether the applicant has more than a “fanciful" prospect of success. That may be a judgment of law or of fact, or of mixed law and fact. Where there are factual issues capable of being disputed and in dispute, summary dismissal should not be awarded to the respondent simply because the Court has formed the view that the applicant is unlikely to succeed on the factual issue. Where the success of a proceeding depends upon propositions of law apparently precluded by existing authority, that may not always be the end of the matter. Existing authority may be overruled, qualified or further explained. Summary processes must not be used to stultify the development of the law. But where the success of proceedings is critically dependent upon a proposition of law which would contradict a binding decision of this Court, the court hearing the application under s 31A could justifiably conclude that the proceedings had no reasonable prospect of success.
[26] Where an application under s 31A requires consideration of apparently complex questions of fact, then the caution uttered by Lord Hope is relevant. The importance of those considerations is amplified if the case involves resolution of issues of law and fact, or mixed law and fact.
[9] See, too, the earlier comments of Gleeson CJ, Gummow, Hayne & Crennan JJ in Batistatos v Roads and Traffic Authority (NSW) (2006) 226 CLR 256 at p.275 [46] (internal citations omitted): “Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way." These remarks from Batistatos were cited with approval in Spencer at pp.131-132 [24].
To the above, I simply note the Full Court’s brief observation in Davis v Insolvency and Trustee Service Australia,[10] at [18]: “… we do not read Spencer as requiring that summary relief be withheld where there are factual disputes about matters which are not material to the resolution of the litigation.”
[10] Davis v Insolvency and Trustee Service Australia [2010] FCAFC 141.
More recently still, in Ekes v Commonwealth Bank of Australia, the New South Wales Court of Appeal said, at [88] (Bathurst CJ; Beazley P at [176] and Emmett JA at [204] agreeing):[11]
[88] Although the principles are well known it is useful in the particular circumstances of the present case to refer to a summary of them by Emmett JA in New South Wales v Williams [2014] NSWCA 177 at [71], Macfarlan JA and Simpson J agreeing:
[71] The requirement for establishing that there is no triable issue is a demanding one and the power to strike out a pleading on the basis that it discloses no reasonable defence, or is an abuse of process, should be exercised only in plain and obvious cases. The power should not be exercised in cases of doubt or difficulty or where the pleading raises a debatable question of law. Once it appears that there is a real issue, whether of fact or law, and that the rights of the parties depend upon it, a court should not dismiss a defence raising such an issue, either on the basis that no reasonable defence is disclosed or as an abuse of process (see Dey v Victorian Railways Commissioners 78 CLR 62 at 91 ; [1949] HCA 1; General Steel Industries Inc v Commissioner for Railways (NSW) 112 CLR 125 at 129–130 ; [1965] ALR 636 at 638–9 ; [1964] HCA 69; Commonwealth v Griffiths 70 NSWLR 268 ; [2007] NSWCA 370 at [11]–[12] and Spencer v Commonwealth 241 CLR 118 ; [2010] HCA 28 at [54]).
[11] Ekes v Commonwealth Bank of Australia (2014) 313 ALR 665.
In the light of these principles, the following outline of evidence, and the later discussion, is considered.
Procedural History: Claims, Defences & Cross-Claims
On 21st October 2014, the Applicant (“United Voice” or “the Union”) filed an Application under the Fair Work Act 2009 (“the FW Act”) and a Statement of Claim. The Applicant sought relief in relation to alleged underpayment of wages pursuant to the Secom Security Employee Collective Agreement 2009 – 2014 (“the Agreement”) (Exhibit A). The employees of the First Respondent (“Secom”) who were allegedly underpaid, and the amounts claimed to have been underpaid, are set out in Schedules to the Statement of Claim.
A Response, Defence (by both Respondents/Defendants) and Cross-claim (by Secom against the Union), were filed on 17th November 2014. The Cross-claim named Mr Russell-Uren, an official of the Union, in relation to an accessorial liability claim under s.550 of the FW Act. Mr Russell-Uren was not, and never has been, a party to the proceeding.
The Cross-claim is set out in full later in these reasons, save for the accessorial liability claim against Mr Russell-Uren and Secom’s contentions regarding his involvement in the misrepresentations set out in the cross-claim.
On 2nd December 2014, the Union filed a Defence to the Cross-claim. On the same date, the Union also filed a Response to the Cross-claim (why it required a separate document, and was not included in the Defence to the Cross Claim, was not explained). Also on the same date (2nd December 2014) a further document was filed; it was styled “Second cross-respondent’s defence to the cross claim.” In a “footer” to the document, as opposed to the document itself, Mr Russell-Uren (who prepared the bulk of the documents on behalf of the Union) names himself as the Second Cross-respondent. He made no mention of Rule 28.03 of this Court’s Rules in relation to the effect of a person being named as a party to a cross-claim, and that person thereby becoming a party to the proceeding.
Pursuant to orders made on 1st December 2014, the Union filed an Amended Statement of Claim, which was filed on 12th December 2014. The Orders of 1st December 2014 were silent on the joining of extra parties. Rule 11.02(2) of this Court’s Rules provides that a party may not include a person as a party after the first court date without the leave of the Court. Unfortunately, this is exactly what the Union did.
Schedule A of the Amended Statement of Claim lists sixteen (16) additional Applicants. Further, both Schedule A and Schedule B to the Amended Statement of Claim are stated to be filed in the Federal Court of Australia, “District Registry, NSW.” Unfortunately, such errors or sloppiness are a not uncommon feature of documents filed on behalf of the Union. The Court should not have to point out such blatant errors. Having to correct and or otherwise deal with such errors wastes precious time and resources of everyone, including the public resources of the Court.[12]
[12] See AON Risk Services Australia Limited v Australian National University (2009) 239 CLR 175. In addition to the comments of French CJ at [5], [23] and [24], see also the general observations of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [112] – [113]. And further, see more recent comments in Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Limited (2013) 250 CLR 303 at [51], [56] & [57].
On 14th January 2015, Secom and Mr Izzard filed an Application in a Case. In general terms, that Application sought to have the Amended Statement of Claim set aside (in whole or in part) in relation to the purported joinder of the additional 16 Applicants because of (a) the Union’s failure to comply with this Court’s Rules, and (b) the Union’s failure to comply with the requirements of s.483AA of the FW Act in relation to access to non-member records (in this instance, a duty statement).
The Application also sought, pursuant to Rule 13.10, summary dismissal of the Amended Statement of Claim on the bases that “the claim” (a) has no reasonable prospects of being successfully being prosecuted, (b) is frivolous or vexatious, and (c) is an abuse of process. An order for costs was also sought.
In addition to the alleged under-payment of wages to which I have earlier referred, the Union also claimed in the originating Application that Secom breached right of entry provisions under the FW Act (e.g. ss.483 & 518). The Right of Entry Notices were issued in relation to the Union seeking access to certain documents (e.g. pay-slips, pay records, copies of tender documents, and the like).
Consequent on the breaches alleged, the Union sought declaratory relief and the payment of civil penalties against Secom, and against the Second Respondent, Mr Izzard, who is the Operations Manager for Secom.
Outline of Evidence
The Union’s Evidence
The evidentiary bases of the Union’s claims are set out in the affidavit of Mr Russell-Uren, filed 19th February 2015. Mr Russell-Uren is an industrial officer of the ACT Branch of the Union; he is legally qualified but not admitted to practice. From time to time in this and other matters before the Court, leave has been granted to allow him to appear. His affidavit dealt with three matters: (a) the low paid bargaining dispute before the Fair Work Commission (“the FWC”), (b) the ACT branch of the Union’s relationship with Secom, and (c) the current litigation.
Mr Russell-Uren deposed that, to the best of his recollection, the Union initiated a low paid bargaining application (“the LPB Application”) in 2013, which sought to establish an ACT specific enterprise agreement that covered a range of security companies, including Secom. In the conduct of the LPB Application, the deponent said that particular issues related to [contested] pay records and Union member access to collective bargaining. To this end, Mr Russell-Uren said that he cross examined Mr Gillani (from Secom) in the course of the LPB Application in relation to member payslips and the non-payment of overtime, but did not say what relevance to the current proceeding came from it.
Mr Russell-Uren said that the LPB Application was conducted between 19-22 May 2014. Oral and written submissions were also provided. He said that the decision of the FWC was handed down on 29th September 2014, but surprisingly, he did not disclose the outcome of the LPB Application. Rhetorically, one might reasonably ask: ‘why raise the Application before the FWC and not advise the Court of the outcome, and relevance, of it to the current matter?” In my view, this, and related information, was a significant omission from his affidavit. This is especially so since he seemed to imply, and therefore claim by innuendo, that his cross-examination of Mr Gillani was somehow evidence that was relevant to the matters before this Court. But apart from the aside that he cross-examined Mr Gillani, there is no other information about the Application before the FWC, its decision, and any relevant comments contained in it, or that the Appeal filed by the Union against the decision was also dismissed.
Indeed, it is only upon reading the affidavit of Mr Gillani (from Secom), filed 2nd February 2015, who annexed a copy of the FWC’s decision of 29th September 2014 (annexure SG2), that one learns that the LPB Application was dismissed.[13] Further, only Mr Gillani’s later affidavit, filed 19th March 2015 (par.14) discloses that leave to appeal from this decision by the Union was dismissed by a Full Bench of the FWC on 18th March 2015.
[13] See United Voice (B2013/1264) [2014] FWC 6441.
The FWC September decision was critical of much of the evidence put before it by the Union. Among other things, the Commission said, at [58] (internal citations omitted) (emphasis added):
On the evidence it can hardly be said that low-paid employees of Secom Security have not had access to collective bargaining. The recent history shows otherwise. …evidence that “no-one has ever come to us with an enterprise agreement that would lift wages … if Secom … came to us with a proposition to lift wages …” is not evidence that identifies any difficulty faced by low-paid employees. It is only evidence that Secom has not made an offer on wages that is acceptable to United Voice. It seems clear that such employees have had access to collective bargaining and continue to do so in relation to the current bargaining round. The only difficulty faced by the employees seems to be the desire of the ACT Branch of United Voice to have a territory-based agreement covering employees in the ACT rather than a national agreement. This is not a substantial difficulty bargaining at an enterprise level faced by low paid employees. Such coverage and scope disputes are common to collective bargaining.
At [83], the Commission said: “On the whole the quality of evidence available in this proceeding from which a sensible assessment of the relative bargaining strength of the relevant employees and Respondent Employers might be made is poor …” And in the conclusion to the reasons, at [131], the Commission said: “… the case for authorisation made out by United Voice was weak.”
At [108], the FWC said: “… United Voice has failed to establish any basis upon which it could be said that the grant of an authorisation would assist in identifying improvements to productivity and service delivery in the enterprises operated by the Respondent Employers.”
At [128], the Commission said:
… the evidence of Ms Ryan [on behalf of United Voice] is suggestive of a campaign by United Voice in the ACT over some significant period to engage in multi-enterprise bargaining. This does not fill me with confidence that United Voice would readily consider proposals from particular Respondent Employers that would result in a single-interest enterprise agreement.
As I have said, details of the FWC proceedings should have been provided to the Court by the Union. It did not do so. Having raised the FWC matter, the Union should have properly informed the Court of relevant detail in relation to it, and the relevance (if any) of the findings, comments and ultimate result. None of this happened.
The next part of Mr Russell-Uren’s affidavit dealt with the ACT Branch’s relationship with Secom. Cast in these general terms, and given the imprecision of the material relied upon, it is difficult to see how the “relationship” between the parties is directly relevant to the matters before the Court. For example, at par.12 of his affidavit, Mr Russell-Uren said:
The branch is often called to advise members on whether or not they are being paid correctly. United Voice’s coverage includes hospitality, cleaning and security. Those industries are ones in which I understand there are high levels of industrial non-compliance.
Although no formal objection was taken to this paragraph, its level of generality helps the Court in no relevant respect. And among other matters, the basis for the deponent’s “understanding of the levels of non-compliance”, across a range of areas, is not relevantly set out.
The deponent also set out his belief of the consequences that flowed from an undated decision of this Court (which was not properly referred to or referenced more generally), and his “belief” (par.15) that “the company [Secom] failed to compensate the workers despite being found to have contravened the Award contributed to the Branch’s decision to launch proceedings.” This assertion (or these assertions) is not clear. There appears to be a conflation of past litigation and the current litigation. I could be wrong in this understanding; however, it should not be necessary for the Court to guess what a deponent, such as an industrial officer, should or should not mean as expressed in an affidavit.
Next, at par.16 of his affidavit, Mr Russell-Uren set out what he said was his understanding of the effect of the Secom enterprise agreement.
Then at pars.17-18, he set out, in general terms, (a) his understanding (stated to be “some recollection”) of a request for tender issued by “DHS for security services”, (b) his check of a specified website regarding the request for tender, and (c) copies of letters (annexed to this affidavit) that related to Secom providing security services to the Department of Human Services. The letters annexed are correspondence between Ms Lyndal Ryan (on behalf of the Union) and Senator Carr.[14] There is a third annexure that is considered later in these reasons. It is sufficient to note the following from Senator Carr’s letter to Ms Ryan, dated 11th October 2012.
[14] The annexure notes to this affidavit are inadequate and do not comply with standard requirements for such documents. Because of the regular problems – formal and otherwise – with affidavits filed in the current matter (and regularly in other matters involving the Union), apart from reference to the relevant Rules of Court in relation to affidavits, one may profitably consult J. Levingston, The Law of Affidavits (Sydney: The Federation Press, 2013); in relation to “annexures”, see Chapter 13 “Attachments: annexures and exhibits.”
First, Senator Carr advised that the “recent procurement of security guarding services” by the Department of Human Services (“DHS”) was properly undertaken by that Department’s property services provider (Jones Lang LaSalle: “JLL”), with full compliance with, among other things, Fair Work principles.
Secondly, Senator Carr confirmed that the successful tenderer “complied with the requirements of the tender documentation.”
Thirdly, in relation to alleged under-payment of security guards it was noted by the Fair Work Ombudsman and taken up with JLL and Secom. The Senator confirmed that the allegations of under-payment were being investigated by DHS.
Finally, Senator Carr confirmed that in tender processes in relation to cleaning and security services, it was mandatory that, among other things, there be certification of compliance with both Fair Work principles, notification of any findings or judgments against the tenderer in the two years prior to the date of lodgement of the tender, as well as “conformance” with Commonwealth Procurement Rules (“CPRs”).
In my view, these confirmations by Senator Carr are significant. I return to them later in these reasons.
Returning then to Mr Russell-Uren’s affidavit, at pars.19 and 20, he said that in 2013 and 2014 Secom and the Union sought to agree upon an agreement that, in his words “replicated the terms and conditions of the 2009 agreement.” Details of that 2009 agreement were not provided in his affidavit or otherwise. As earlier noted, it became Exhibit A (it was tendered by Secom). He confirmed that the ACT Branch of the Union (and its members) objected to that agreement. He set out very briefly the grounds of that objection: primarily a belief that it would reduce the take-home pay of the members. He also confirmed that the 2014 Agreement was approved by Commissioner Gregory in December 2014. He said that a notice of appeal to that decision had been filed; but again, unfortunately no further detail was provided.
In relation to the current litigation in this Court, Mr Russell-Uren said that the proceedings arose out an investigation he had conducted in relation to payment of overtime by Secom. The investigation arose out of complaints from two members, one of whom said that he had worked in excess of 125 hours per week for a period of three months, toward the end of which (he said) the worker suffered a heart attack. He said this report was made to him in December 2013.
He said further that there appeared to be no payment of overtime to the two workers in question, and that the workers had brought the situation to the attention of Secom. He said that “we” “created the calculations” (use of the word “created” is perhaps an unfortunate description), and then “sought various opinions.” I take this to be taking advice from Counsel, rather than casual conversations between non-experts: again, the Court should not have to guess what actually occurred because of the imprecise terminology used in affidavits.
Mr Russell-Uren said, at par.23, that “in around June it became apparent that the underpayments were more endemic ….” How such an opinion was formed was not explained.
“In around August 2014” the deponent said that he entered several buildings at which Secom provided security services, after which he issued a “section 483 notice” that required Secom to provide documents which were not available at the time of entry to the premises inspected. No mention was ever made as to whether there was compliance with s.483AA FW Act by the Union in obtaining an order from the FWC in relation to the production of non-member records.
At par.26, Mr Russell-Uren deposed that Secom provided “a first batch of documents”, but he could not recall the date on which this occurred (because the date had been deleted). He recalled sending a threatening email, on a date he cannot recall, after which the documents sought were provided. He complained about having to spend time on a weekend to sort out the documents that he said had been shuffled.
He further said that not all documents requested/demanded (by threatening email) had been provided, which led to sending a letter to Secom on 1st August 2014, giving Secom “a further extension of time until 1st September 2014 to provide the remaining documents.” He deposed (par.28): “To the best of my recollection all of the remaining documents other than the ‘tender documents’ and ‘duty statements’ were provided.”
By way of observation only at this stage: given the number of times the deponent relies upon his “best recollection”, rather than proper or regular business records, and or having made proper inquiry, the Court may draw an inference about the poor state of such records, which could (at some later period) lead to some further inference about the reliability of the deponent’s recollection, particularly if it was to be challenged by ordinary business records from Secom or the Commonwealth/DHS.
At par.29, Mr Russell-Uren explained how calculations had been completed between 1st September and mid-October 2014, and that by 17th October, “the original statement of claim had been amended to include additional members and the right of entry breaches.” It is for later comment that there was in fact (as noted earlier in these reasons) a later amended statement of claim filed on 12th December 2014, which further amended the claims. Given the apparently poor records (or poor record-keeping) of someone, the later details were missed or not available in the earlier amendments to the [draft] statement of claim that was filed on 21st October 2014.
The deponent said (par.32) that the proceedings brought against Secom seek to recover a sum “around $200,000.” He also said that “we concluded” that Secom needed to be held to account for their actions.
Mr Russell-Uren said he accepted that the LPB case, the enterprise agreement appeal, and the current litigation “have not contributed to a happy relationship between the ACT Branch of the United Voice and Secom Australia.”
Finally, Mr Russell-Uren provided (annexure SRU3) a copy of a letter sent to Secom’s lawyers, dated 15th January 2015 in which he pointed out certain deficiencies in Secom’s Application in a Case filed the previous day.
Leaving to one side both the previously highlighted formal deficiencies in the annexure note, and that it refers to the Application in a Case, “filed 2 February 2015” (it was in fact filed on 14th February 2015), it is sufficient to note one particular aspect of the letter. In its “third reason” why, in the Union’s view, the summary dismissal Application was misconceived, Mr Russell-Uren said (emphasis added):
… in any case, to the extent that leave is necessary, it will be sought and we cannot conceive of any reason why it should be refused. If you are aware of any such reason we invite you to identify it and we will duly consider it.
Respectfully, the presumption about what the Court would do in “rubber-stamping” the leave required under the Rules, but not sought by the Union, is remarkable and alarming. Giving relevant allowance for a non-practitioner (the deponent) but who has lawyers available to him on the staff of the Union, as well as the Union regularly briefing Counsel, the comments to Secom’s lawyers are completely inappropriate in every respect. The comments also suggest that Mr Russell-Uren did not, or does not, comprehend the role of and the need to comply with the Rules of Court.
Contrary to usual practice in summary applications of the kind currently before the Court, at the request of Secom’s solicitor, I allowed brief cross-examination of Mr Russell-Uren. This occurred after noting (more than once) that summary applications, by their nature and in accordance with long-standing authority (referred to earlier in these reasons), are customarily dealt with (a) without embarking on a fact-finding exercise, and (b) by reference [usually or only] to the affidavit evidence filed and submissions of the parties.
To speak generally, in my view, the cross-examination of Mr Russell-Uren did not take matters very much further than what is set out in the affidavit material and in the detailed submissions filed. It is sufficient to note the following from his limited evidence.
First, there was confirmation, of sorts, that the appeal against the FWC’s approval of the latest enterprise agreement with Secom, referred to in Mr Russell-Uren’s affidavit, was unsuccessful.[15]
[15] See Transcript (17th April 2015) pp.17-18. Hereafter, references will simply be “T” followed by the relevant page number.
Secondly, in the light of matters set out at pars.27 and 29 of his affidavit, Mr Russell-Uren was asked questions about calculations he had done based on material provided by Secom. Among other things, he said that he may have inadvertently included in his calculations regarding annual leave periods of workers’ compensation; he confirmed that he also included annual leave, personal carer’s leave, and some unpaid leave, all as part of the calculation of annual leave and entitlements related thereto. He also confirmed that it was possible in these calculations that he may have included “annual leave cash out payments” if they were indistinguishable from annual. He further confirmed that he was aware that there can be “averaging” for these matters over a period of twelve months.[16]
[16] T 20-21.
Unfortunately, the vagueness and imprecision of his evidence (both in his affidavit and orally) gives the Court significant concern about the accuracy and the general foundation for the claim with respect to the underpayments alleged, among other claims.
Thirdly, lest it not have been plain in the affidavits, Mr Russell-Uren confirmed that the Union did not/does not regard Secom as having a good industrial reputation.[17]
[17] T 24.
Fourthly, Mr Russell-Uren said that he was aware that Secom had undertaken a reconciliation of payments in relation to overtime and any claimed shortfall in relation to it. He also said that he could not recall when he made inquiries of union members about any alleged overtime under-payments and whether such inquiries took place before or after the proceedings were instituted in this Court.[18]
[18] T 25.
He did recall that he only sought approval from the members of the Union who the Union now sought to have joined as additional Applicants after the Statement of Claim had been filed.[19] This evidence further confirms the Court’s concerns about the proper attention to this Court’s Rules. They seem to have been treated as unnecessary trivialities. They are anything but.
Secom’s Evidence
[19] T 26.
As earlier noted, a Response and Defence were filed by the Respondents, and a Cross-Claim by Secom, on 17th November 2014.[20] Summarily stated, the Respondents say:[21]
(a)They deny the breaches alleged, inter alia, because the breaches alleged by the Union (under s.539(2) of the FW Act), and which are not particularised, do not give the Union relevant standing because no employee is affected by the contravention pursuant to s.540(2) of the FW Act;
(b)Further, although any alleged under payment would affect an employee, it does not relevantly affect the Applicant Union;
(c)Secom does not admit that the Union official who has brought the Application on behalf of the Union has standing to do so, nor has that official particularised his authority to do so;
(d)Among other things, the Respondents do not admit that Secom was properly served;
(e)In relation to the right of entry claims, and in particular those that concern access to certain specified documents (e.g. pay slips) at named premises, the Respondents challenge the basis of the breaches alleged on the grounds that the Department of Human Services (“DHS”) and the Japanese Embassy were occupiers of the relevant premises. Secom was contracted to provide services at the said premises. The Respondents said (par.15): “Entry to these premises to request such documents is not authorised under section 481 of the FW Act, because it is not reasonable to suspect that the requested documents would be available at these premises.”
(f)Certain tender documents provided to DHS sought by the Union are not, said the Respondents, directly relevant as required by s.483(1) of the FW Act;
(g)Further, the Respondents say that because Secom did not tender to the DHS, it has no tender documents in its possession (or that of the Second Respondent) as alleged by the Union.
[20] Unfortunately, the pleadings filed by the Respondents do not comply with the Rules of Court in relation to font size and spacing. Given the significant detail of the claims made and denied, this is particularly unfortunate. As well, each new part of the Defence begins with paragraph “1”. The non-sequential numbering makes referencing in argument and in this judgment more difficult than it should be. See Federal Circuit Court Rules 2001, r. 2.01(1)(g).
[21]The heading of the document filed on 17th November 2014 clearly confirms, as does Part F of it, that the cross-claim is brought only by Secom and not by Mr Izzard.
In addition to the above, the Respondents say in opposition to the relief sought in the Statement of Claim, as set out in Part D of the Defence and Response:
The first and second respondents oppose the orders sought in paragraph 26 of the applicant’s claim on the following basis:
a) The first respondent did not breach subclause 4.2.3 of the Agreement or item 2(2) of Schedule 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) as it has paid overtime penalties to the persons identified in Schedule A of the applicant’s claim;
b) The first respondent has paid overtime penalties to persons identified in Schedule A of the applicant’s claim;
c) The first respondent did not breach subclause 4.2.3 of the Agreement or item 2(2) of Schedule 16 of the Transitional Act, therefore there are no grounds to order a penalty;
d) The first respondent did not breach subsection 483(4) of the FW Act by failing to produce the Tender documents as no Tender documents were provided to the DHS by the first respondent;
e) The second respondent was not involved in any breach of subsection 483(4) of the FW Act by failing to produce the Tender documents as there are no Tender documents provided to the DHS by the first respondent;
f) The first respondent did not breach subsection 483(4) of the FW Act, therefore there are no grounds to order a penalty;
g) The second respondent was not involved in any breach of subsection 483(4) of the FW Act, therefore there are no grounds to order a penalty; and
h) There have been no breaches, therefore no penalty can be levied to the applicant.
After seeking to have the Statement of Claim dismissed, as already noted, the Respondents seek an order for costs under s.570(2) FW Act on the basis that the proceedings were instituted vexatiously or without reasonable cause, and were/are an abuse of process.
The First Respondent’s cross-claim is as follows. Relevantly, it is in two parts: the first relates to claims against the Union, among other things, in which Secom contends that there has been a series of misrepresentations, which contravene s.503(1) FW Act. Secondly, there is a claim, pursuant to s.550 FW Act, of accessorial liability which is directed against Mr Russell-Uren. It is as well to set out the cross-claim in full:
1) The first respondent has standing to make this cross-claim pursuant to item 25 of subsection 539(2) of the FW Act, as it is “a person affected by the contravention” and Rules 28.01 and 28.03 of the Federal Circuit Court Rules 2001.
2) On 13 August 2014, the applicant issued to the first respondent the First Notice pursuant to section 481 of the FW Act and sent copies to:
a. the first respondent;
b. the DHS; and
c. the Japanese Embassy.
3) The First Notice was signed and issued by Mr Russell-Uren and Ms Erryn Cresshull.
4) The First Notice is required to:
a. contain the requirements provided under section 518 of the FW Act; and
b. to be in a form prescribed by Schedule 3.3 of the Fair Work Regulations 2009 (FW Regulations).
PARTICULARS
i. section 521 of the FW Act that states: “the regulations may provide for, and in relation to, the following:
(a) the form of…entry notices”.
ii. Rule 3.27 of the FW Regulations that states: “for paragraph 521(a) of the Act, the form of an entry notice is set out in Form 2 in Schedule 3.3”.
iii. Form 2 of Schedule 3.3 of the FW Regulations.
5) The First Notice states, amongst other things:
“I note that this is not Secom’s first contravention of The Fair Work Act 2009 and that Secom is a repeat offender. I also note that this was brought to your attention in the Low Paid Bargaining proceedings. Despite that: it remains unaddressed.”
6) The first respondent has not previously been found to have breached the FW Act (Statement 1).
7) Statement 1 was made in circumstances where:
a. it was not a matter required or authorised to be made in an entry notice under the FW Act;
b. the applicant would have been aware, or ought to have been aware, that the statement was not authorised or required to be made;
c. the applicant would have been aware, or ought to have been aware, that the statement would convey to the recipients that this alleged ‘previous conduct’ founded the reasonable suspicion of a contravention of the FW Act; and
d. the applicant made the statement in an attempt to damage the reputation of the first respondent to its major clients.
8) Statement 1 constitutes a misrepresentation in contravention of subsection 503(1) of the FW Act in that it was made with the intention of giving the impression, or reckless as to whether the impression is given that the statement formed part of the suspected contravention of the FW Act.
9) The statement to the effect that “this is not Secom’s first contravention of The Fair Work Act 2009” and that “Secom is a repeat offender” was brought to the first and second respondents attention in the Low Paid Bargaining proceedings is false (Statement 2).
10) Statement 2 was made in circumstances where:
a. it was not a matter required or authorised to be made in an entry notice under the FW Act;
b. the applicant would have been aware, or ought to have been aware, that the statement was not authorised or required to be made;
c. the applicant would have been aware, or ought to have been aware, that the statement would convey to the recipients that this alleged ‘previous conduct’ founded the reasonable suspicion of a contravention of the FW Act; and
d. the applicant made the statement in an attempt to damage the reputation of the first respondent to its major clients.
11) Statement 2 constitutes a misrepresentation in contravention of subsection 503(1) of the FW Act in that it was made with the intention of giving the impression, or reckless as to whether the impression is given that the statement formed part of the suspected contravention of the FW Act.
12) On 14 August 2014, Mr Russell-Uren, on behalf of the applicant, entered the premises referred to in paragraph 15 of the applicant’s claim, and sought to exercise rights to inspect documents pursuant to subsection 482(1) of the FW Act.
13) Whilst at each of the premises Mr Russell-Uren, requested to inspect Tender documents provided to the DHS by the first respondent.
14) Notwithstanding that the Tender documents to the DHS do not exist, it is not reasonable to expect that such documents would be stored at a location that the first respondent does not occupy. Alternatively, if the Tender documents to the DHS did exist, they could not have been directly relevant to the suspected contravention of unpaid overtime.
15) The applicant was not authorised to request the Tender documents to the DHS, as they were not directly relevant, and has therefore contravened subsection 482(1) of the FW Act.
16) The request for Tender documents to the DHS constitutes a misrepresentation in contravention of subsection 503(1) of the FW Act in that it was made with the intention of giving the impression, or reckless as to whether the impression is given that the request was authorised by section 482 of the FW Act.
17) On 14 August 2014, Mr Russell-Uren, on behalf of the applicant, sought access to the Tender documents to the DHS by a written notice (Second Notice) pursuant to subsection 483(1) of the FW Act.
18) Notwithstanding that the Tender documents to the DHS do not exist, they are not directly relevant to the suspected contravention of unpaid overtime.
19) The applicant was not authorised to request the Tender documents to the DHS in the Second Notice, as they were not directly relevant, and has therefore contravened subsection 483(1) of the FW Act.
20) The request for Tender documents to the DHS in the Second Notice constitutes a misrepresentation in contravention of subsection 503(1) of the FW Act in that it was made with the intention of giving the impression, or reckless as to whether the impression is given that the request was authorised by section 483 of the FW Act.
Accessorial liability
21) Pursuant to section 550 of the FW Act, a person is involved in a contravention of a civil remedy provision if the person:
a. has aided, abetted, counselled or procured the contravention; or
b. has induced the contravention, whether by threats of promises or otherwise; or
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.
22) Mr Russell-Uren was involved in the contraventions of subsections 503(1), 482(1) and 483(1), within the meaning of section 550 of the FW Act, as:
a. he is an industrial officer in the employ of the applicant who has, or ought to have, actual knowledge of the right of entry provisions of the FW Act;
b. he is a permit holder and holds an entry permit within the meaning of section 512 of the FW Act;
c. he was knowingly concerned in the contravention of subsection 503(1) of the FW Act, as he personally signed and issued the First Notice, and had, or ought to have had actual knowledge that Statement 1 and Statement 2 were false, and therefore knowingly made misrepresentations in the First Notice;
d. he was knowingly concerned in the contravention of subsection 482(1) of the FW Act, as he entered the premises referred to in paragraph 15 of the applicant’s claim to requested documents and knew, or ought to have known, that it was a requirement under subsection 482(1) of the FW Act that any requested documents be directly relevant to the suspected contravention and therefore knowingly made misrepresentations, in contravention of subsection 503(1) of the FW Act, about his authority to request such documents; and
e. he was knowingly concerned in the contravention of subsection 483(1) of the FW Act, as he personally signed and issued the Second Notice referred to in paragraph 19 of the applicant’s claim, including the request for Tender documents to the DHS, and had, or ought to have had the knowledge that it was a requirement under subsection 483(1) of the FW Act that any requested documents be directly relevant to the suspected contravention and therefore knowingly made misrepresentations, in contravention of subsection 503(1) of the FW Act, about his authority in the Second Notice.
The relief sought in the Cross-claim, summarily stated, is for certain declarations to be made against both the Union and Mr Russell-Uren, as well as civil penalties against the Union and Mr Russell-Uren.
Three affidavits were filed on behalf of Secom; by Mr McDonald (Secom’s lawyer), filed 14th January 2015; and two by Mr Gillani, filed 2nd February and 19th March 2015. Mr McDonald filed a second affidavit on 2nd February 2015, but the body of it is incomplete, although it appears to replicate most of what is in his earlier affidavit. But its annexures are different to his earlier affidavit.
I will deal with Mr Gillani’s affidavits first. He is the Human Resources Manager of Secom.
In his first affidavit he deposed to Secom having a troubled relationship with the Union. All parties are agreed on this.
He said that Secom had been trying to negotiate a new enterprise agreement for its Australian operations since 2012. He said that the ACT Branch of the Union had resisted attempts to negotiate such an agreement because the Union (he said) wished to enter a multi-enterprise agreement with other major security providers.
After the proceedings noted earlier in these reasons regarding the Union’s Application for low paid bargaining, at which Mr Gillani said he gave evidence on 13th August, on that same date Right of Entry Notices were served on Secom, although they bear the date of issue as 13th July 2014. On 14th August, Mr Gillani said that Mr Russell-Uren and Ms Cresshull (also from the Union) entered the premises of the Japanese Embassy and DHS. On that same date, Mr Russell-Uren issued a Request for Documents to the Company. Mr Gillani said that Secom provided the documents requested.
On 29th August 2014, Mr Russell-Uren sent an email to Mr Izzard (of Secom) in the following terms (a copy of the email is annexure SG1 to this affidavit):
… if these documents are not provided by close of business today United Voice will institute proceedings against Secom and you personally by Tuesday.
As already noted, the FWC dismissed the Union’s LPB Application on 29th September 2014. On 21st October, the Union commenced the current proceedings in this Court.
Mr Gillani said (par.13) that negotiations continued with the Union regarding the new enterprise agreement, and contrary to the Union’s advocated position, “the overwhelming majority of employees voted in favour of the approval of the new enterprise agreement.”
Further to this, Mr Gillani said (par.14) that Mr Russell-Uren opposed the approval of the agreement, but notwithstanding this opposition the FWC approved it. Mr Gillani confirmed (par.15) that Ms Ryan, the Secretary of the ACT Branch of the Union, filed a Notice of Appeal in relation to that approval.
At par.16, Mr Gillani set out parts of the Right of Entry Notice (“ROE Notice”), dated 13th July 2014.[22] As set out in the affidavit, and in addition to seeking documents specified in the Notice, it said, in part:
a) On 14 August 2014, Mr Russell-Uren and Ms Cresshull would enter the Japanese Embassy, and DHS premises;
b) “this is not Secom’s first contravention of the Fair Work Act 2009 and that Secom is a repeat offender. I also note that this was brought to your attention in the Low Paid Bargaining proceedings”, and
c) “given Secom’s character and industrial conduct United Voice will not hesitate to launch proceedings against the company and any other person involved.”
[22] Mr Gillani said that the relevant Notice was annexure SG3 to his affidavit; it is in fact annexure SG4.
Mr Gillani deposed that he understood that similar Notices had been sent to the Japanese Embassy and to DHS in Canberra.
Among documents sought were (a) copies of the tender documents provided to DHS, and (b) “any duty statement for any employee responsible for ensuring compliance with the Fair Work Act 2009.”
In relation to the request for documents, Mr Gillani said that while Secom provides security services at some DHS locations, those services are not by way of a contract with DHS but rather pursuant to a company (JLL) that provides facility services to DHS. He confirmed that Secom did not submit a tender to DHS for the provision of security services. Accordingly, he said, Secom had/has no documents (because none exist) that come within the description contained in the relevant Notice.
Further, he said that no Secom employee has the responsibility for ensuring regulatory compliance under the FW Act; that is left to senior managers generally, with no specific person responsible as suggested by the Notice.
Until recently, he said that employees of Secom were employed under a 2009 employee collective agreement, to which the Union was not a party. He said that all employee entitlements under that 2009 agreement had been paid, including overtime; he also said that the amounts payable had been double-checked and any shortfall was paid to any employee in or about October 2014.
In Mr Gillani’s second affidavit (filed 19th March 2015), he replied to various matters to which Mr Russell-Uren had deposed.
First, he objected generally to assertions in that affidavit and considered various statements by Mr Russell-Uren to be “misleading, exaggerated or simply untrue.”
In more detail, he said that the LPB issue was not a dispute but simply an application by the Union for bargaining to occur with the major security contractors. This application (as earlier noted) was rejected by the FWC.
Secondly, in relation to the comments by Mr Russell-Uren regarding alleged under-payment of workers, Mr Gillani said that the error in payment that was the subject of proceedings brought in this Court in 2013 was as a result of an error regarding the correctly applicable instrument.[23] That error was corrected, and a self-audit was conducted by Secom which rectified any under-payments.
[23] See Fair Work Ombudsman v Secom Australia (ACT) Pty Limited [2013] FCCA 649.
Further, as noted by Mr Gillani, Mr Russell-Uren asserted that employees were not paid pursuant to the 2013 decision to which I have just referred. Mr Gillani noted that in that judgment, it was clearly stated that “there is no dispute that the underpayment has been rectified.”
For abundant caution, at [23] of that decision, I said (emphasis added):[24]
There is no dispute that the underpayment has been rectified. Nor is there any dispute that the Respondent has cooperated with the Applicant in relation to the investigation. Further, there is no evidence that the Respondent has previously engaged in similar conduct.
[24] Fair Work Ombudsman v Secom Australia (ACT) Pty Limited [2013] FCCA 649 at [23].
I have emphasised part of those reasons in relation to there being no relevant history of conduct of underpayment by Secom because of the contention by Mr Russell-Uren in the ROE Notice that Secom was “a repeat offender.” Clearly this was not the view of the Fair Work Ombudsman in the 2013 proceedings before me. In the light of the comments by this Court in 2013, the assertion by Mr Russell-Uren in his affidavit should not have been made.
Thirdly, (and without going through each of the comments in reply), Mr Gillani noted again that there were no tender documents in answer to the Union’s Notice because Secom’s contract is with JLL, and not with DHS.
Fourthly, Mr Gillani confirmed that the appeal against the FWC’s latest approval of the latest Secom collective agreement was dismissed by the Full Bench of the FWC on 18th March 2015.
Finally, Mr Gillani confirmed (pars.15-19) that in relation to the allegation by Mr Russell-Uren regarding an employee who was said to have worked for 3 months at 125 hours per week, he had checked Secom’s records. Leaving aside statements of incredulity that anyone would, or any employee would, allow such extensive hours, Mr Gillani confirmed that the Secom records show the employee in question (whose identity he had later checked with Mr Russell-Uren) worked on average 41.5 hours per week when he was employed by Secom, and that this employee had never worked 125 hours per week, “or any hours approximating that figure.” In later submissions, this extravagant claim by the Union, and the evidence of Mr Gillani, were never addressed by the Union. In my view, this was another significant omission by the Union.
Mr McDonald’s first affidavit (filed 14th January 2015) dealt firstly with the claims in the original Statement of Claim, and noted Secom’s defence to them, namely (a) that the Applicant does not have standing to bring the claim, (b) any underpayments to employees regarding overtime have been paid, and (c) Secom did not tender to DHS, and in consequence there are no tender documents that Secom has in response to the Notice/Request issued by the Union.
Secondly, other than referring to procedural matters, Mr McDonald referred to (a) the Union not having sought leave to join the additional sixteen Applicants, and (b) the Amended Statement of Claim adding a further contravention claim, said to arise out of Secom’s failure to produce any duty statement requiring any employee to ensure compliance with the FW Act.
In relation to this further contravention, Mr McDonald deposed that s.483AA FW Act permits a permit holder to apply to the FWC for an order allowing that permit holder to access “non-member records.” He said that no such order had been provided by the Union to Secom.
Again I note that this claim of [non] compliance with s.483AA FW Act has never been addressed by the Union.
In his second (but incomplete) affidavit (filed 2nd February 2015), Mr McDonald annexed copies of correspondence between himself and the Union (Mr Russell-Uren). Among other things, that correspondence (a) sought copies of the calculations done by the Union that founded the claim for the underpayments alleged,[25] (b) challenged the Union to provide any evidence about Secom having any relevant tender documents with DHS (he repeated the evidence of Secom that it does not have any such documentation), and (c) also challenged the Union to provide copies of any order in compliance with s.483AA FW Act to access any relevant duty statement (which he also, again, denied that Secom had in any event). He invited the Union to discontinue the proceeding, and that failure to do so would lead to an application for costs.
[25] In Submissions filed 2nd March 2015, pars.32-34, Secom said that its lawyer wrote to the Union on 22nd January 2015 requesting copies of the calculations that the Union had performed that founded its claim for the alleged underpayments. It was confirmed in those submissions that the Union never replied to the letter requesting these details, and in consequence, the calculations requested have never been provided.
This completes the outline of evidence.
Submissions Generally
The Union’s submissions were in three parts: primary submissions, filed 18th March; an outline of argument, filed 14th April, and Supplementary Submissions, filed 8th May 2015. Unsurprisingly, there is some overlap between them. The main arguments are outlined below, all of which, the Union says, should lead to the Court dismissing Secom’s summary dismissal Application with costs.
Regarding summary dismissal applications generally, the Union noted that, according to principle, considerable caution was required in exercising power to dismissed proceedings summarily.[26] Further, in addition to the onus being on the moving party, the exercise of significant caution is heightened even more if there are disputed issues of fact or law. It was also submitted that there could be no finding of ‘no reasonable prospect of success’ where there is a real issue of fact.
[26] It is unnecessary to record the various authorities referred to, by either party, because they were discussed earlier in these reasons.
The Union also submitted that the power to dismiss proceedings on the ground of abuse of process was an exceptional power that would be exercised only in exceptional circumstances.
Procedurally, the Union said it was not clear whether the summary dismissal application was brought under s.17A of the Federal Circuit Court of Australia Act 1999, or under Rule 13.10 of the Federal Circuit Court Rules 2001.[27]
[27] See also Rule 13.07, which deals with “summary judgment.”
Section 17A refers to “summary judgment”, while Rule 13.10 refers to “summary dismissal.” Plainly, in law, there is a clear distinction. However, respectfully, certainly in this instance, this is a distinction without any practical difference because the end result will essentially be the same. Moreover, the authorities cited by both parties invariably refer to the Federal Court’s cognate provision (s.31A Federal Court of Australia Act 1976) to s.17A of this Court’s enabling legislation.
More substantively, the original submissions deal with three issues: (a) standing, (b) the merit of the substantive application (regarding alleged underpayments), and (c) abuse of process predicated on the Union having ill-will towards Secom, and that it is this animus that gives rise to the proceedings.
Procedurally, given how discrete and limited the issues are, it seems both more efficient and expedient if, rather than outline each and every submission then go back over the issues in dispute, I will (a) outline the competing submissions in relation to each issue, (b) detail my consideration of each issue and (c) make a determination in accordance with the process undertaken, the evidence available, and by reference to the applicable principle.
The issues to be determined, and noted below, are (a) the standing of the Union to bring the current proceeding (included here is the joinder of extra Applicants), (b) the merit of the Union’s claim regarding alleged underpayments by Secom, (“the merit issue”; the “abuse of process” aspect will be addressed in the course of consideration of this claim), and (c) the production of documents sought by the Union (“the production of documents issue”).
The Standing Issue:
The Union’s Submissions
The Union says that the issue of standing is governed by s.405 of the Workplace Relations Act 1996 (“WR Act”), which section operates by virtue of item 2(3) of Schedule 3 of the Fair Work (Transitional and Consequential Provisions) Act 2009. The Union then outlines the operation of s.405 WR Act, which in general terms details who has standing with respect to civil remedies.[28]
[28] S.405(3) refers in particular to the requirements that apply to unions before commencing proceedings on behalf of an employee. These include that an employee has requested the union to take the action on that person’s behalf.
Paragraph 1(c) of the Amended Statement of Claim states that the Union –[29]
by virtue of sections 539(2) (item 40) and s.540(2) of the Fair Work Act 2009 (Cth) (FW Act), has standing to apply for relief claimed in the application filed with this statement of claim.
[29] I have not noted any of the items deleted from the original statement of claim that are struck through in the amended statement of claim.
As helpful as this paragraph is, at least in part, it is also incomplete, precisely because (so far as the Court can tell) the “item 40” referred to is in fact item 40 of Schedule 16, not of the FW Act, but of the Fair Work (Transitional and Consequential Provisions) Act 2009, which deals generally with “compliance” and the items in that schedule refer specifically to “standing, jurisdiction and maximum penalties.” It would have been helpful, not to mention appropriate, if the proper and complete citation had been given, rather than (again) the Court having either to guess or to correct errors and omissions in material presented to the Court.
Given the number of times such a comment has been made in these reasons, apart from the sheer tedium of having to plough through such consistently inaccurate and sub-standard work, one hopes that the Court’s concern about the lack of attention to relevant detail is clearly if not painfully on display in the current matter. It has wasted much time and resources of the Court in having to deal with such shoddy work.
In the Outline of Argument, filed 14th April, the Union simply stated that it was clear that the Union had standing to bring the proceeding, and in any event, by the joinder of the additional [worker] Applicants, any deficiency regarding standing would be remedied.
In the Supplementary Submissions filed on 8th May, there was a slight change of tack by the Union. It said that (a) according to Secom’s submissions, s.718 WR Act would provide standing for the Union to bring this proceeding, and (b) while s.405 deals with standing with respect to breaches of workplace agreements and other matters in Part 8 Division 11 of the WR Act, s.718 (which is in Part 14 of the WR Act) is concerned with penalties and other remedies for breaches for contravention and standing to sue for them.
Accordingly, said the Union, s.718 WR Act is the relevant provision that gives the Union standing to bring the current action.[30]
[30] I need not detail anything further in relation to the proposed joinder of additional Applicants.
What is more than a little curious, as well as unhelpful, is that in none of the written submissions provided by the Union is there any reference to ss.539 and or 540 FW Act, as pleaded in its Amended Statement of Claim. In my view, too much attention was placed on the WR Act and transitional provisions at the expense of provisions in the FW Act which are more directly relevant.
Secom’s Submissions
Secom filed submissions on 2nd March (of 17 pages), 14th April (1 page), 1st (9 pages) and 22nd May (5 pages).
In relation to standing, over many paragraphs, Secom stressed that the Union has not properly explained, or pleaded accurately, the base or bases for its standing, either under the WR Act (and transitional legislation), or under the FW Act. For example, because (it says) that the Union is not/was not a party to the employment agreement that was lodged with the FWC, it did not have standing to bring the current proceeding in relation to any alleged underpayments pursuant to that agreement.
Secom further said that s.405 WR Act did not apply because (as I presume the submission to intend) there is no evidence of any request for the action by a relevant employee as required by the section. Similarly, there is no standing afforded to the Union, it was submitted, under s.539(2) FW Act. Curiously, there was no submission in relation to s.540(2) FW Act.
In the submissions filed on 1st May, Secom focussed on the applicability of s.405 WR Act, and said that because there was an apparent inconsistency between this section and s.718 of the same Act, and because s.405 was the more specific of the two sections, it should apply rather than s.718.
Secom submitted that, because there has been no proper pleading of its standing, the action brought by the Union should be struck out.
Standing: Consideration & Disposition
For the reasons that follow, the challenge by Secom to the Union’s standing must fail, in the light of (a) general law principles in relation to standing (which no submission addressed), (b) the interpretation and application of legislation in relation to standing, and (c) the contention that the standing of the Union was not properly pleaded.
By way of general propositions or statements of principle, the following may be stated.
First, in Bateman’s Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd, Gaudron, Gummow and Kirby JJ said, at [50], that what was required to satisfy “standing” was that there be “a sufficient material interest in the subject matter. Reasons of history and the exigencies of present times indicate that this criterion is to be construed as an enabling, not a restrictive, procedural stipulation.”[31]
[31] Bateman’s Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247.
Secondly, in Truth About Motorways Pty Limited v Macquarie Infrastructure Investment Management Limited, at [92], Gummow J said that under a system of strict common law pleading, the question of the plaintiff’s standing merged with the legal merits.[32]
[32] Truth About Motorways Pty Limited v Macquarie Infrastructure Investment Management Limited (2000) 200 CLR 591.
Thirdly, in Hussein v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs, Graham J said, at [46]:[33]
It will be appreciated that the rules relating to standing are designed to ensure that applicants only litigate their own business. For an applicant to have standing demands a connection between the applicant’s interests and the relief sought. As a general rule the Court will not recognise busybodies who interfere in things that do not concern them.
[33] Hussein v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs [2006] FCA 286.
Fourthly, there are decisions of general and particular significance involving unions who have been granted standing to bring proceedings on behalf of their members. These decisions include Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (Gummow J – as his Honour then was), and by the High Court in Shop Distributive and Allied Employees Association v Minister for Industrial Affairs.[34]
[34] Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 71 ALR 73; Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (1995) 183 CLR 552. For present purposes, I need not comment on further distinctions between enforcement of public as opposed to private rights, or the particular detail of the cases to which I have referred and the legislation under consideration in some of those cases.
These general principles, applied to the current matter, in my view, readily give the Union standing to bring the proceeding.
In terms of particular legislation that relates to standing in industrial matters, it is sufficient to note the following.
In Health World Ltd v Shin-Sun Australia Pty Ltd, the High Court (French CJ, Gummow, Heydon and Bell JJ) said, at [21] (internal citations omitted):[35]
… the meaning of a general expression like “aggrieved” will depend on an examination of the language of the particular statute in which it appears. That examination will reveal the subject, scope and purpose of the statute, and the meaning of “aggrieved” may vary as the subject, scope and purpose varies.
[35] Health World Ltd v Shin-Sun Australia Pty Ltd (2010) 240 CLR 590.
That case involved a contest in relation to whether the Appellant was “aggrieved” under the Trade Marks Act 1995. Later, the Court said, at [31]:
The legislation has not defined “aggrieved” in ss 88 and 92, and many courts have eschewed any attempt to do so. Rather they have proceeded to deal with the particular problem before them, leaving it to later courts to deal with different problems in the light of their own peculiar circumstances. It is desirable to employ that technique in this case as well.
In the current matter, I should be taken generally to accept the submissions of the Union regarding legislative provisions concerning standing. That said, as with much in this matter, there was much also to confuse and especially in relation to the evidence, opaqueness and lack of attention to detail were often the hallmark or defining characterisation of them. I will not repeat the concerns expressed earlier in these reasons.
Notwithstanding the submission from Secom that former employees may not be relevantly affected so as to come within the terms of the sections, in my view ss.539 and 540 FW Act are more than sufficient to give standing to the Union to bring the current proceeding(s). As poorly drafted as much of the material put before the Court by the Union is, and as already noted, while there is much that is erroneous or at least less than helpful in the wider material, those sections of the FW Act are pleaded in the Amended Statement of Claim. The fact that they are so pleaded is also sufficient answer to Secom’s contention that the standing of the Union was not properly or sufficiently pleaded.
One further issue in relation to standing needs to be addressed.
The Union says that, even in the event that there are genuine questions in relation to the Union’s standing, the addition of the extra [Union member] Applicants would resolve any matter surrounding standing. And further, (it was submitted) it would be the most expeditious course to grant standing because all that would otherwise occur is that the Applicant workers would bring fresh proceedings, which would be a waste of time and resources.
Respectfully, in large measure I accept the second of these submissions. However, in relation to the addition of extra Applicants and the lack of an Application for leave for this to occur, the letter to which I have earlier referred that is annexed to Mr Russell-Uren’s affidavit in which he states, matter-of-factly to Mr McDonald that he could not conceive of the Court not granting leave as required by the Rules, is both disrespectful to and presumptuous of the Court. Accepting that he is not admitted to practice (although legally qualified), in my view the letter nonetheless showed both a cavalier approach to proper procedure under the Rules of the Court that require leave to be sought for the addition of extra parties, and a presumption that leave would be granted, effectively making the Court into little more than a “rubber stamp”. It was remarkable that the letter was attached to the affidavit. Presumption of a Court is a very dangerous (as well as a discourteous) attitude.
In the circumstances, because of the Court’s ruling in relation to standing, strictly speaking I do not need to make any ruling in relation to the additional proposed Applicants. However, in the light of the comments I have made, it might be reasonable to assume that, if such an application had been made (which certainly never occurred prior to the filing of the Amended Statement of Claim, or since) I might not so readily grant leave under the Rules, as Mr Russell-Uren presumed. As always, I would need to be persuaded by the relevant evidence.
The Merit Issue: Underpayments or Not?
There was here much more heat than light, to which both parties contributed to varying degrees. This issue, as with all, occupied a disproportionate amount of time and resources.
Put shortly, the Union claims a range of underpayments that are owed to workers by Secom. Secom says that it has done its own audit and that it has made good any underpayments. The Union says that it has done its own calculations, based on Secom’s own records, which establish that there have been underpayments. Secom says that it wrote to the Union seeking to be provided with copies of those calculations, but has had no response to that request.
The Union says that because this issue necessarily involves a contested issue of fact (e.g. construction of whether periods of leave should be included) and law, it cannot be appropriate to dismiss this claim summarily. It must be tested in the usual way at a trial.
Secom treated this issue essentially as part of the abuse of process contentions. It said that, in the light of the evidence (albeit untested) of Mr Gillani that any and all underpayments were paid in October 2014, to proceed with the underpayment claim in the current proceeding amounted to an abuse of process. It further contended that the abuse of process submission was established on the basis that the underpayment claim(s) made by the Union cannot be established.
Secom sought to rely, among other things, on the evidence of Mr Russell-Uren given at the interlocutory hearing to the effect that he was aware of claims made by some of the members of the Union that there had been repayment of some outstanding overtime. Further, as noted earlier, Mr Russell-Uren could not recall any relevant detail as to what was and what was not included in the calculations regarding the alleged underpayments.
Secom also relied upon comments by the High Court in Jeffery & Katauskas Pty Limited v SST Consulting Pty Ltd regarding what might be comprehended by the description “abuse of process.”[36] At [28] in Jeffery & Katauskas, the High Court said (internal references omitted):
The term “abuse of process” as used in Australia today, is not limited by the categories mentioned above or those which constitute the tort. It has been said repeatedly in the judgments of this Court that the categories of abuse of process are not closed. In Walton v Gardiner the majority adopted the observation in Hunter v Chief Constable of the West Midlands Police that courts have an inherent power to prevent misuse of their procedures in a way which, although not inconsistent with the literal application of procedural rules of court, would nevertheless be “manifestly unfair to a party to litigation ... or would otherwise bring the administration of justice into disrepute among right-thinking people.” This does not mean that abuse of process is a term at large or without meaning. Nor does it mean that any conduct of a party or non-party in relation to judicial proceedings is an abuse of process if it can be characterised as in some sense unfair to a party. It is clear, however, that abuse of process extends to proceedings that are “seriously and unfairly burdensome, prejudicial or damaging” or “productive of serious and unjustified trouble and harassment".
[36] Jeffery & Katauskas Pty Limited v SST Consulting Pty Ltd (2009) 239 CLR 75.
Consideration & Disposition: The ‘Merit Issue’
In my view, because of the competing contentions by both parties, it is not possible for the Court to form a view about the veracity and or accuracy of the claim(s) made by the Union. That said, what is particularly troubling is that the Union’s claim about alleged underpayments (a) is not on oath (other than very generalised comments by Mr Russell-Uren and his lack of clarity or recollection as to how they were calculated), (b) is not particularised in any relevant respect in the sense that, other than stating in a Schedule to the Amended Statement of Claim, what the Union claimed as having been un- or under paid, no details have been forthcoming about how those calculations were made and (c) despite a specific request in writing by Secom’s lawyer to provide the calculations, the Union has not only not done so but has not even replied to that request. In these respects, the conduct of the Union is unacceptable. Indeed, absent any proper and detailed explanation, the errors are of such a kind that, in my view, they come within the general principles articulated by Sheppard J in Colgate-Palmolive Company v Cussons Pty Ltd that otherwise can lead to an order for the payment of indemnity costs.[37]
[37] Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 at pp.233-234. See also comments by Tracey J in Australian and International Pilots Association v Qantas Airways Ltd (No.3) (2007) 162 FCR 392 at [39].
I also note the comments in Construction, Forestry, Mining and Energy Union v Clarke, where (relying upon and endorsing the comments of Tracey J in Pilots Association) the Full Court said, at [29]:[38]
As the authorities indicate, there is a distinction between a party who pursues arguments which are ultimately abandoned or rejected by the Court and a party who commences a proceeding which is misconceived in the sense of being incompetent or unsupportable. … Simply because a party does not conduct its litigation in the most efficient way does not mean that the Court should exercise its discretion in s 824(2) of the WR Act to make a costs order. … while courts should use the discretion in s 824(2) to ensure that parties to litigation arising from the WR Act do not engage in unreasonable acts and omissions which put the other party to undue expense, they should also be careful not to exercise the discretion with too much haste, given that such haste may discourage parties, for fear of an adverse costs order, from pursuing litigation under the WR Act in the manner which they deem best.
[38] Construction, Forestry, Mining and Energy Union v Clarke (2008) 170 FCR 574; 176 IR 245.
In the current matter, the Union has had more than ample time to provide details in support of the underpayment claim. It is now being afforded a further opportunity to fill this obvious and needless void. In a worst case scenario, if it is unable or unwilling to provide the information long sought by Secom, it will likely fall into the category of proceeding (or claim) described by the Full Court where “a party who commences a proceeding which is misconceived in the sense of being incompetent or unsupportable.” Obvious consequences would flow from such a finding or course of conduct by the Union.
Further, it is of some significance, in my view, that the remarkable claim regarding a member having worked (so it was said) 125 hours per week for three months, and in particular its challenge by Secom that, according to its records the worker in question had never worked more than 41.5 hours per week, has never been addressed further by the Union. Subject to any further evidence and submissions, this unusual claim, of itself, could provide sufficient evidence for a finding of abuse of process on the Union’s behalf if it proves to be as fanciful as Secom’s records suggest. If so, it would also likely show up the Union’s lack of due and proper inquiry before filing the statement of claim. Otherwise, at this stage, I do not propose to make any other comments on the abuse of process claim levelled by Secom against the Union.
In my view, the proper course in relation to this issue is to order that
(a)within 7 days of the date of these orders, the Union is to provide to Secom’s lawyer (as previously requested) the calculations and all relevant details to explain and to substantiate the underpayments alleged in the Amended Statement of Claim;
(b)the information provided by the Union is to be provided in an affidavit;
(c)if the requisite information is provided, the parties are to attend mediation on a date and time to be arranged with the Registry of the Court, and the matter be adjourned to the list on 30th November 2015 at 9:30am;
(d)absent this information being provided in full and within the time specified, and subject to other orders herein, those parts of the Amended Statement of Claim that relate to “underpayment” (pars.8 – 11) be struck out, and the costs of this part of the Application be paid by the Union on an indemnity basis.
Production of Documents Issue: Submissions
This matter goes, primarily, to the Union seeking the production of documents, which it says Secom must have, namely tender documents and a duty statement (both documents particularised earlier in these reasons).
Secom says in response that (a) the letter from Senator Carr (attached to Mr Russell-Uren’s affidavit) to the Union confirms that Secom was not a party to the tender process that involved DHS, and therefore it has no documents to produce in response to the request from the Union, (b) Secom otherwise says that it has no such documents either in relation to the tender or in relation to a duty statement that purportedly goes to requiring a nominated employee to ensure compliance with FW Act standards because such compliance issues are dealt with by other staff of Secom, and (c) the Union has not complied with FW Act requirements both as to pleading and otherwise regarding the relevance of the documents to any contravention alleged, as well as the failure to comply with the requirements of s.483AA FW Act.
Consideration & Disposition: The Production of Documents Issue
As with other matters, arguments from the parties regarding the dismissal application are conflicted and (unsurprisingly) polarised. Tellingly, however, the Union simply asserts matters, including an assumption that Secom must have documents from the company (JLL) managing the DHS property; the Union further assumes, in my view inappropriately, that Secom must have generated the tender documents for JLL and its tender to DHS. On the other hand, Secom (a) has the benefit of Senator Carr’s letter, which was provided by the Union, in which the Senator confirms compliance with all tender requirements and with FW Act principles, and (b) sworn (but still untested) evidence by Mr Gillani that Secom does not have any of the documentation that the Union simply asserts it has.
Further, as already noted, the Union never addresses Secom’s contentions about compliance with s.483AA FW Act, and that (per s.483(1) FW Act) the documents sought must be “directly relevant” to the contravention alleged. Nor does the Union address the submission by Secom that it is not reasonable to expect that the documents sought would be stored at a location that Secom does not occupy. This latter submission, in my view, not only has not been addressed, but it seems to be unarguable in response by the Union.
In my view, because (a) the Union has had ample opportunity to make good the direct connection/relevance between the documents sought and any of the claims against Secom but has not done so, (b) a fair reading of Senator Carr’s letter confirms that Secom did not tender to DHS for the provision of security services, and (c) the tender was compliant with FW Act principles, at its highest, the claim against Secom by the Union in this regard must necessarily be considered very weak. Even if such documents were found to exist, it is unclear how or in what respect they would be “directly relevant” to the claims against Secom, as required by s.483(1) FW Act. As already stated, the Union has never explained the connection. In my view, simple assertion (as well as assumption about the creation and or location of the tender documents) does not, without more, make for an appropriate claim for production of documents that Secom has consistently sworn it does not have. Nor has the Union addressed at all the s.483AA requirements regarding obtaining the pre-requisite order from the FWC for access to non-member documents.
For these reasons, those parts of the Amended Statement of Claim that relate to the right of entry by the Union and the production of documents should be struck out, namely Part C of the Amended Statement of Claim (pars.12 – 25).
Conclusion
I remind myself of the cautions outlined by the High Court in Spencer in the joint judgment of French CJ and Gummow J at [25] (emphasis added):
Section 31A(2) requires a practical judgment by the Federal Court as to whether the applicant has more than a “fanciful" prospect of success. That may be a judgment of law or of fact, or of mixed law and fact. Where there are factual issues capable of being disputed and in dispute, summary dismissal should not be awarded to the respondent simply because the Court has formed the view that the applicant is unlikely to succeed on the factual issue.
Their Honours, at [26], also referred to caution in summarily dismissing matters where there are “apparently complex questions of fact.” In my view, that is not the situation with the present matter. The factual matters, while highly contested, are not complex. Many of them could have been readily resolved, for example, by the provision of basic information that had been sought by Secom from the Union regarding what was included in its calculation of the alleged underpayments. The Union has never provided that information, even when asked specifically for it. And in cross-examination, Mr Russell-Uren could not provide any further light or clarity on the issue.
In the light of these circumstances, it is a very significant indulgence for the Court to allow the Union yet more time to provide this basic information, which should have been provided months ago. Not to have provided it has resulted in the waste of significant resources by the Court, and doubtless by others. I need not repeat, but simply refer to, the stern comments by the High Court regarding the waste of the public resources of courts in AON Risk Services Australia Limited v Australian National University and Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Limited.[39]
[39] AON Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 at [5], [23] and [24] (French CJ) and at [112] – [113] (Gummow, Hayne, Crennan, Kiefel and Bell JJ); Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Limited (2013) 250 CLR 303 at [51], [56] and [57] (French CJ, Kiefel, Bell, Gageler & Keane JJ).
In a contest in a different forum involving these parties (and others), the Fair Work Commission was critical of the Union regarding the weakness of its case, and seemed also to question whether the Application was in the interests of the Union’s members, but rather more in the interests of the Union. In quite a number of respects, the claims made by the Union in this Court warrant similar comments. Generally, the claims are weak. They are poorly presented, with significant inattention to relevant and basic detail. The poverty of presentation and lack of attention to proper detail has led to a waste of Court resources, among other things. The Union has also shown a decided lack of enthusiasm to provide material that properly should have been provided both before it was requested, but especially so when it was so asked by Secom.
It may be that many of the same procedural and other issues to which I have referred would not have arisen had the Union been represented by solicitors who are both experienced and well versed in matters of this kind, rather than simply to continue to rely upon “in-house” legal work. The independent mind brought by experienced solicitors to litigation, who are not employed by the Union, may have altered very significantly the conduct of the matters before the FWC and before this Court. One would hope also that a more independent mind might have brought a less tactically antagonistic and obfuscatory or obdurate approach than appears to have been the case in the current matter, and seemingly so in the proceeding before the FWC. Of course, it is a matter for the Union whether it takes up this unsolicited advice.
In any event, in short, the summary dismissal application has not been completely successful. There has been some success on both sides.
Parts of the Amended Statement of Claim have been struck out. And the Court has noted on a number of occasions the very poor evidence of the Union more generally which has led to a greater than necessary expenditure of Court resources. In such circumstances, subject to what happens in relation to the production (under oath or affirmation) of its calculations and the reasons for them regarding the alleged underpayments and the consequences that would flow if that does not occur, Secom should have its costs of the strike out application, (which was run in the alternative to the summary dismissal application) which was successful in relation to the production of documents issue.
On this subject of costs, I am conscious of the terms and requirements of s.570, and the jurisprudence that surrounds it.[40] It is sufficient to note that, in Australian and International Pilots Association v Qantas Airways Ltd (No.3), at [36], it was held that “prosecution of any incompetent or hopeless case can be regarded as ‘an unreasonable act’.” This case also dealt with striking out an amended statement of claim. In detail, Tracey J said:
In dealing with an application for costs under s 347(1) of the Act, in Standish v University of Tasmania [1989] FCA 166; (1989) 28 IR 129, Lockhart J was called on to decide whether the proceeding had been instituted “without reasonable cause.” His Honour drew a distinction between the pursuit of an argument which does not succeed and the institution of a proceeding which is misconceived in the sense of being incompetent: see at 138-9. This distinction may, in my view, assist in determining whether conduct is unreasonable for the purposes of s 824(2). The prosecution of any incompetent or hopeless case can be regarded as “an unreasonable act" within the meaning of s 824(2). Conversely, in my opinion, the pursuit of a contentious, and ultimately unsuccessful, argument is not an unreasonable act.
[40] In this regard, I simply refer without any necessary discussion to the Federal Court of Australia decisions in Construction, Forestry, Mining and Energy Union v Clarke (2008) 170 FCR 574; 176 IR 245; and Australian and International Pilots Association v Qantas Airways Ltd (No.3) (2007) 162 FCR 392; 165 IR 464.
In my view, precisely because of (a) the extremely shoddy manner in which the Union has conducted its case, (b) the obvious weaknesses on almost every front of it, (c) very significantly, the Union has had many opportunities to explain and or to provide relevant particulars and material to support the claims it alleges against Secom but has not done so, an order for costs should be made against it, at this time, at least with respect to the production of documents claim. Absent any further Application in relation to costs, I would propose that the appropriate order in this regard is that costs be paid as agreed or as taxed in relation to the discrete issue of the production of non-member documents. I note again that it risks a further costs order, and on an indemnity basis (for reasons given earlier), if there is further failure to provide the calculations and all other relevant information to Secom to substantiate the claims in relation to the alleged underpayment of workers.
It was agreed that the issues to be determined are as set out in these reasons: standing, the merit of the underpayment claim (including abuse of process counter claim), and production of documents. Nonetheless, given that the Cross-claim specifically alleged misrepresentation by the Union in relation to the underpayments, the Court may have at least expected that some mention of that claim would be made, and likewise some reference to the accessorial liability claim against Mr Russell-Uren. Neither issue was referred to in submissions, even in passing. In my view, these were omissions; they should have been traversed, even in the most summary form, to the degree that they impacted on the primary issues to be determined by the Court. Moreover, Secom dealt with these matters in its submissions, but again, there was nothing in response in the Union’s submissions. All of this said, I do not make any other or further comment on the Cross-claim and its various component parts.
In all of the circumstances, and in addition to the costs orders I have made, I will make further orders that, once the underpayment issue has been ventilated with the documents produced and further examined, the parties attend mediation on a date and time to be arranged with the Registry. The matter will be re-listed to the November general federal law list as set out in the orders.
The Court so orders.
I certify that the preceding one hundred and seventy-two (172) paragraphs are a true copy of the reasons for judgment of Judge Neville
Associate:
Date: 31 August 2015
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