Verdura v Cooper Real Estate Pty Ltd
[2016] FCCA 1239
•12 May 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| VERDURA v COOPER REAL ESTATE PTY LTD | [2016] FCCA 1239 |
| Catchwords: INDUSTRIAL LAW – Orders made in default – applicant failed to appear – application in a case to set aside orders pursuant to Rule 16.05(2)(a) – explanation for failure to appear – whether reasonable explanation – no evidence from applicant –whether prejudice – application in a case dismissed. |
| Legislation: Fair Work Act 2009 |
| Cases cited: Clifford & Mountford [2006] FMCAfam 450 Alvaro v Legalwest Pty Ltd [2012] FMCA 1088 Postorino v Track ‘n’ Find & Anor [2012] FMCA 342 Wint v Medimobile Pty Ltd [2016] FCCA 102 Stollznow v Calvert [1980] 2 NSWLR 749 Andresakis v Alexus HoldingsPty Ltd [2006] NSWCA 294 Taylor v Taylor [1979] HCA 38; (1979) 143 CLR 1 Jess v Scott (1986) 12 FCR 187 Jowett v Kelly [2008] NSWSC 1009 Amos v Wiltshire [2014] QCA 218 |
| Applicant: | NICHOLAS VERDURA |
| Respondent: | COOPER REAL ESTATE PTY LTD |
| File Number: | MLG 2150 of 2015 |
| Judgment of: | Judge O'Sullivan |
| Hearing date: | 12 May 2016 |
| Date of Last Submission: | 12 May 2016 |
| Delivered at: | Melbourne |
| Delivered on: | 12 May 2016 |
REPRESENTATION
| Counsel for the Applicant: | Ms Zambelli |
| Solicitors for the Applicant: | Rosendorff Lawyers |
| The Respondent: | No appearance |
ORDERS
The Application in a Case filed on 6 November 2015 be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 2150 of 2015
| NICHOLAS VERDURA |
Applicant
And
| COOPER REAL ESTATE PTY LTD |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
Introduction
Before the Court today, 12 May 2016, is an application in a case filed on behalf of Nicholas Verdura (“the applicant”). The respondent to the application in a case is Cooper Real Estate Proprietary Limited trading as Cooper Real Estate (“the respondent”). The application in a case was filed on 6 November 2015. The application in a case is supported by an affidavit of the applicant’s solicitor Brett Anthony Samuel (“the solicitor”) affirmed 6 November 2015 (“the affidavit of the solicitor”).
Today at the hearing of the application in a case, Ms Zambelli of Counsel appeared on behalf of the applicant. There has been no appearance on behalf of the respondent. However, the wife of the director of the respondent did appear in Court. She told the Court that she is here today and had wanted to make an application for an adjournment because her husband is overseas. Counsel for the applicant confirmed that her instructor was aware of that proposed application and had been on notice that the respondent had wanted to make such an application. The applicant has not been able to provide the Court with any evidence that the application in a case had been served on the respondent. However, it appears from what the Court was told that the respondent had been aware of today’s Court date for some time.
It appears from what the Court has been told from the bar table today that the applicant’s solicitor had represented to the respondent that it was not necessary for them to be here. Ultimately, there has been no application to appear for nor any application for an adjournment filed by, or made on behalf of the respondent. There has been no evidence filed or put in support of any applications.
The applicant’s Counsel told the Court the applicant accepts that the respondent would object to the orders sought in the application in a case. The applicant also accepts that the respondent would claim that it would be prejudiced by the orders sought by the applicant, and ultimately it would be a matter for the Court to determine. In the circumstances I declined to consider adjourning the hearing, and the matter proceeded in the absence of the respondent.
Application in a case
Turning to the application in a case, the orders sought therein were as follows:
“1. The Order of the Court, dated 30 October 2015, is set aside.
2. The proceeding is listed for directions on a date to be determined by the Court.”
The affidavit of the solicitor affirmed on 6 November 2015 and filed in support of the application in case stated in paragraphs 1 through to 12 as follows:
“1. On 18 September 2015 I filed an application and form 2 to commence this proceeding on behalf of the applicant.
2. On 18 September 2015 the court made an order scheduling a first directions hearing in the proceeding to be conducted at 10 am on 30 October 2015 in the Federal Circuit Court.
3. On 28 October 2015 I wrote to the respondent with a copy of draft consent orders seeking whether the respondent would consent to the proposed orders. I did not receive a response from the respondent.
4. On 30 October 2015, the date of the hearing, due to an oversight I became preoccupied with my work in the morning and accidentally failed to attend the hearing. Later that evening as I was reviewing the day’s events, I realised my oversight. In part the mistake was caused by my failure to note the time and date of the directions hearing in my diary which I rely upon to organise my day.
5. On 30 October 2015, in the absence of the parties, the court made an order pursuant to rule 13.03C(1)(c) that the proceeding be dismissed.
6. In the interests of justice, I request the court to reinstate the proceeding pursuant to rule 16.05 which allows the Court to set aside an order made in the absence of a party, as the applicant instructed us to appear at the hearing and our failure to appear should not prejudice the applicant’s rights to pursue his claim when the proceeding has been struck out through no fault of the applicant.
7. Furthermore, the respondent would suffer no prejudice as they have incurred no costs or taken any steps in the proceeding and this application is being made immediately after the mistake was identified.
8. In my opinion the merits of the applicant’s application are sufficiently strong to warrant the reinstatement of the proceeding. The applicant was employed as a real estate representative and claims that:
a. The respondent too adverse action as described in section 342 of the Fair Work Act (“the Act”) by dismissing the applicant because the applicant exercised his workplace right in seeking payment of his commissions.
b. In terminating the applicant’s employment, the respondent also failed to comply with a number of other provisions of the Act. In particular:
i. the applicant claims that in the termination of his employment, no written notice was provided, in contravention of section 117(1) of the Act;
ii. the minimum notice period that the respondent was required to provide the applicant was one week. The applicant was neither paid during this period nor informed he would be paid one week in lieu of notice, in contravention of section 117(2) of the Act.
c. The respondent has also breached the Real Estate Award 2010 (“the Award”) and therefore section 45 of the Act as the respondent was never entitled to engage the applicant on a commission only agreement with the result that the Applicant was significantly underpaid in breach of the Award.
d. Given that the applicant could not be defined as a commission only employee, the respondent also breached a number of other provisions in the Award, including but not limited to:
i. Failing to pay the applicant the minimum wage entitlements;
ii. Failing to pay the applicant on a weekly, fortnightly or monthly cycle in breach of clause 21.1 of the Award;
iii Failing to pay the applicant overtime as the applicant often worked more than 38 hours per week;
iv. Failing to pay the applicant loadings or penalty rates for work conducted on weekends and public holidays.
9. In the applicant’s Form 2 filed on 18 September 2015 the applicant claims that he has been underpaid:
a. $18,734.78 in wages;
b. $6,263.43 in outstanding commissions;
c. Superannuation guarantee contributions;
d. Overtime;
e. Annual leave;
f. Petrol expenses;
g. Loadings and penalty rates;
h. Notice;
i. The applicant also seeks compensation for loss and damage arising from the loss of his employment.
10. Additionally, the applicant has also invested significant sums in both time and resources to advance his application. Due to extenuating circumstances, the applicant lodged his original general protections claim (Form F8) out of time and was therefore required to make an application for an extension of time pursuant to section 366(2) of the Act. In support of the application, the applicant filed a statement of evidence and submissions. Now produced and shown to me marked “BAS-1” is a copy of the applicant’s statement of evidence and submissions that were filed on 6 May 2015.
11. On 31 July 2015, Commissioner Gregory handed down his decision and granted the applicant an extension of time pursuant to section 366(1)(b). Now produced and shown to me marked “BAS-2” is a copy of Commissioner Gregory’s decision dated 31 July 2015.
12. Based on the evidence the applicant has provided to me, I believe the applicant has strong prospects of success in this proceeding and ask that the Court exercise its discretion and set aside the orders made on 30 October 2015.”
Background to application in a case
On 30 October 2015 the Court made orders in proceedings which had been commenced by application filed on 18 September 2015. In that application the applicant made allegations of contraventions by the respondent of the Fair Work Act 2009 (“the Act”). The applicant said that he had been employed by the respondent as a sales representative from September 2014 until March 2015.
On 30 October 2015 there was no appearance by or on behalf of the applicant. The respondent appeared represented by its director Mr Cooper. In the absence of the applicant (and as there was no explanation for the applicant’s absence, or that of his solicitor, no contact with the Court by or on behalf of the applicant to explain his absence or that of his solicitor) the provisions of rule 13.03C(1)(c) of the Federal Circuit Court Rules 2001 (“the Rules”) were applied and an order made dismissing the application filed 18 September 2015, as follows:
“1. The application filed 18 September 2015 be dismissed pursuant to Rule 13.03C(1)(c) of the Federal Circuit Court Rules 2001.”
What then ensued was as follows. On 2 November 2015 the solicitor sent the following email to the Court, which was copied to the respondent:
“Dear Associate,
The first directions hearing for matter MLG2150/2015 was scheduled for Friday 30 November (sic) before Justice (sic) O’Sullivan.
Our firm was engaged to appear on behalf of the applicant at the first directions hearing. Unfortunately, due to an oversight on my own behalf, I forgot to attend.
In addition to this communication, I am forwarding to the court communication between our firm and the respondent two days prior to the hearing with proposed consent orders.
My purpose in doing so is to inform the court that we were enlivened to the hearing last Friday and only failed to attend due to a mistake of our own doing.
I am of the understanding that the respondent also did not attend to the first directions hearing. I have reviewed the Federal Circuit Court Rules and am aware the court has the discretion to strike out the application if the applicant fails to appear at a directions hearing but ask the court to overturn those orders (if such an order has been made) and either:
1. Set the matter down for a reschedule first directions hearing; or
2. Make the orders as attached subject of course to written confirmation from the respondent that they consent to the proposed orders.
I sincerely apologise to the court for my failure to appear and any inconvenience caused. It is the first time such an incident has occurred to me as a practitioner (and hopefully the last) and ask that no orders be made that could prejudice my client (the applicant).
We look forward to your response.”
The following response was sent to the solicitor:
“Dear Sir/Madam,
We refer to the above matter and to your correspondence attached below.
We advise it is inappropriate for you to communicate directly with chambers without first obtaining the consent of the other party.
We can advise you that Orders were made on Friday 30 October 2015 which have now been processed and sent to parties in the mail.
We attach the Court's policy regarding communication with chambers.”
On 6 November 2015 the solicitor then filed the application in a case that is before the Court today and the affidavit of the solicitor.
On 16 November 2015 the solicitor sent further correspondence to the Court, which was copied to the respondent, which was:
“Dear Associate,
On 30 October 2015, orders were made to have this matter dismissed.
On 10 November 2015, the honourable court made orders for the hearing of an interlocutory application made by the applicant to have the matter reinstated.
The date scheduled for the interlocutory application is 12 May 2015 (sic).
The applicant has communicated with the respondent seeking its consent to communicate with the court and request the date be brought forward. The respondent has not responded.
The applicant requests the court bring forward the applicant’s interlocutory application to an earlier date, preferably by the end of 2015 or January 2016.
The applicant estimates that the application will take no longer than 15 minutes and intends on making very brief (if any) oral submissions in support of its application.
The affidavit in support of the interlocutory application is 2 pages in length.
Could his Honour O’Sullivan kindly indicate whether he would be willing to reschedule the applicant’s application to an earlier date.”
The following response was sent to the solicitor:
“Dear Mr Samuel,
We refer to your email below.
Please note that it is inappropriate to contact chambers without first obtaining consent from the other party.
It is also an inappropriate application to make directly to chambers.
We note however, the application filed on behalf of your client has been given the earliest date possible by the Registry and therefore will remain listed on 12 May 2016.”
There the matter lay until today.
Today Ms Zambelli has appeared on behalf of the applicant. Counsel identified that her client relied on the application in a case and the affidavit of the solicitor, both filed on 6 November 2015.
Counsel made submissions on the matters that were said to be relevant to the orders sought in the application in a case. Counsel identified that the applicant was seeking to invoke the provisions of r.16.05(2)(a) of the Rules, which provides as follows:
“(2) The Court may vary or set aside its judgment or order after it has been entered if:
(a) the order is made in the absence of a party;…”
Approach to application in a case
Counsel referred to a number of authorities including Clifford & Mountford [2006] FMCAfam 450 (“Clifford & Mountford”), and Alvaro v Legalwest Pty Ltd [2012] FMCA 1088. To those cases can also be added Postorino v Track ‘n’ Find & Anor [2012] FMCA 342 and Wint v Medimobile Pty Ltd [2016] FCCA 102. It was made clear that the Court would apply the principles enunciated by, as His Honour then was, Jarrett FM in Clifford & Mountford, the relevant paragraph of which is at paragraph 34 of His Honour’s decision and is as follows:
“34. From the abovementioned authorities, it seems to me that the following principles emerge in respect of applications under r.16.05(2)(a):
a. The discretion to be exercised is unfettered, but nonetheless to be exercised judicially and bearing in mind the public interest in there being an end to litigation.
b. There are three criteria, each of which should usually be demonstrated before a judgment or order is set aside under r.16.05(2)(a), namely:
i. a reasonable explanation for the applicant's absence at the trial or hearing;
ii. material arguments available to the applicant that might reasonably lead to the making of an order different to that sought to be set aside; and
iii. no prejudice to the party with the benefit of the orders sought to be set aside that is not able to be adequately addressed by the Court.
c. Matters relevant to the three criteria set out above will include, but will not necessarily be limited to:
i. Whether a party with notice of proceedings disregarded the opportunity of appearing at and participating in the trial;
ii. Delay, if any, in bringing the application to set aside and whether, if during the period of delay the successful party has acted on the judgment, or third parties have acquired rights by reference to it;
iii. the conduct of the applicant since the judgment or order sought to be set aside was made.”
Submissions
Counsel for the applicant accepted those were the relevant factors. Counsel made submissions in support of each of those identified matters. Counsel submitted that the application in a case filed on 6 November 2015 was made days after the orders of 30 October 2015. In the circumstances, it was submitted there had been no delay.
Counsel for the applicant relied on the affidavit of the solicitor. It was submitted that affidavit provided an explanation of what was said to be “an unfortunate error”. It was submitted that whilst the respondent was at Court on 30 October 2015 there appeared to have been no costs to the respondent in attending that hearing. Whilst it was noted that there has been an effluxion of time and the inconvenience caused by that, beyond this it was submitted that there was no prejudice to the respondent if the Court made the orders sought in the application in a case.
It was submitted that in the circumstances, given the nature of the claims made in the application filed on 18 September 2015, and that what had been sought was compensation in excess of $20,000, the applicant should not be shut out from pursuing that claim.
Consideration
Turning then to a consideration of the factors in light of the principles set out earlier in these reasons, and the submissions made in support of the orders sought by the applicant today.
It can be accepted that as a general proposition the fault of the solicitor should not be visited on the client (Stollznow v Calvert [1980] 2 NSWLR 749, Andresakis v Alexus HoldingsPty Ltd [2006] NSWCA 294). An order made at a hearing against a party in the absence of a solicitor due to the solicitor’s fault may breach a fundamental principle of natural justice and be liable to be set aside (Taylor v Taylor [1979] HCA 38; (1979) 143 CLR 1).
In Jess v Scott (1986) 12 FCR 187 in relation to whether an error by a solicitor as to the date of delivery of the judgment from which leave to appeal was sought constituted special reasons supporting the grant of leave. The Full Court of the Federal Court found that such an order did amount to special reasons, and ordered the respondent’s costs of the application be borne by the applicant’s solicitor personally. It is not an immediate answer to a party which asks the Court to set aside an order made against it in its absence, to say that it has a remedy against its lawyers because of incompetence or some other reason (Jowett v Kelly [2008] NSWSC 1009).
However, this matter is not analogous to a case where the evidence of the applicant is the error was made by a solicitor in failing to attend a hearing, or misapprehending a certain date. There is no evidence from the applicant about the circumstances regarding the hearing on 30 October 2015, the subsequent events, the error of the solicitor, or any prejudice because of that. Importantly, there is no evidence suggesting the applicant was not aware of the hearing on 30 October 2015 and no explanation from the applicant for his absence. The affidavit of the solicitor says nothing about why his client did not appear on 30 October 2015. Given the time that has elapsed since the orders were made, and the time that has elapsed since this matter was fixed for hearing, the explanation that has been provided is unsatisfactory.
In my view, that is a significant matter telling against there being a finding of a reasonable explanation for the absence of the applicant at the hearing. In terms of material arguments available to the applicant, I accept the submissions that have been made on behalf of the applicant by Counsel today. However, those are only a summary of the allegations made by the applicant.
The applicant would still have to establish the basis for the relief that he seeks on the balance of probabilities. A significant issue also telling against the orders sought by the applicant today, is the issue of prejudice. It has been accepted on behalf of the applicant today that the respondent would claim it was prejudiced if the orders made 30 October 2015 were set aside.
The submissions that have been made on behalf of the applicant in relation to that matter have been set out earlier. Insofar as it is an accepted proposition, that normally the fault of the solicitor should not be visited on the client, the case of Amos v Wiltshire [2014] QCA 218 (which had referred to Taylor v Taylor (supra)) at paragraph 19 said this:
“I would not wish, however, to encourage the view that incompetence, inefficiency or neglect must be endured by the innocent party and comes without sanction. There will be many cases in which delay alone, with or without the added burden of costs, may be a decisive factor against relieving a party from the consequences of its own error. Courts are increasingly conscious of the financial and emotional impact on parties of the avoidable prolongation of litigation and are thus more ready than in the past to infer prejudice for which costs cannot provide full compensation.”
This is such a case, and I am unable to find there would not be prejudice to the respondent for which costs were full compensation. It was not submitted that there were any other relevant matters for the purposes of the Court exercising its discretion under r.16.05(2)(a) of the Rules.
Conclusion
Therefore, and having considered all of the factors relevant to the exercise of the discretion, the material upon which the applicant relied and the submissions made on his behalf, I am not satisfied the orders made on 30 October 2015 should be set aside. For those reasons, the application in a case filed 6 November 2015 will be dismissed.
I certify that the preceding twenty-eight (28) paragraphs are a true copy of the reasons for judgment of Judge O'Sullivan
Associate:
Date: 20 May 2016
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