FEDERAL COURT OF AUSTRALIA

Altintas v O’Dea Lawyers [2018] FCAFC 165

ORDERS

THE COURT:

1.    Declines to answer the reserved question on the basis that it does not have jurisdiction to do so.

2.    Directs that a Registrar of the Court provide a copy of the Court’s judgment to the Attorney-General for the State of South Australia and to the President of the South Australian Employment Tribunal.

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

REASONS FOR JUDGMENT

THE COURT:

1    This judgment concerns a question reserved to the Court by the South Australian Employment Tribunal (the SAET) on 14 December 2017.

2    The question concerns the jurisdiction of the SAET to hear and determine an appeal from an Industrial Magistrate exercising jurisdiction under the Fair Work Act 2009 (Cth) (the FW Act), in particular, whether such an appeal lies only to this Court. For the reasons which follow, we consider that this Court does not have jurisdiction to hear and determine the question and that it should, accordingly, refrain from doing so.

Background circumstances

3    It is convenient in the following description to use the designations which the parties have in the appeal in the former Industrial Relations Court of South Australia (the IRCSA), this being the appeal which gave rise to the referral.

4    In 2015, the Appellant filed an application in the IRCSA seeking orders that the Respondent pay amounts alleged to be due by him in respect of her employment in March and April 2015. She alleged that she was entitled to the claimed amounts by reasons of the Clerks – Private Sector Award 2010, an Award made under the FW Act. The total sum claimed by the Appellant was $3,189.30. In addition, the Appellant sought an order that the Respondent pay a pecuniary penalty. The Appellant’s summons indicated that she invoked the jurisdiction conferred on the IRCSA by ss 539, 545 and 546 of the FW Act.

5    The application was heard by an Industrial Magistrate in the IRCSA. He concluded that, other than in one relatively minor respect, the Appellant had not proven her claim: Altintas v O’Dea Lawyers [2017] SAIRC 7, at [83]. As the Respondent had conceded that he had not paid the Appellant for four hours which she had worked on 13 April 2015, the Magistrate said that he would make an order with respect to those hours (at [83]) and that he would hear from the parties further with respect to the application for the imposition of a penalty (at [86]). However, there has been no further hearing before the Industrial Magistrate. Indeed, it seems that there has not yet been any order at all giving effect to the Magistrate’s findings.

6    Despite that, on 9 March 2017, the Appellant filed a notice of appeal in the IRCSA. The judge to whom the appeal was allocated, Judge Farrell, was concerned as to the jurisdiction of the IRCSA to hear and determine the appeal. The Court was informed that Judge Farrell’s concern arose from the terms of s 565 of the FW Act. It provides (relevantly):

565 Appeals from eligible State or Territory courts

Appeals from original decisions of eligible State or Territory courts

(1)    An appeal lies to the Federal Court from a decision of an eligible State or Territory court exercising jurisdiction under this Act.

(1A)    No appeal lies from a decision of an eligible State or Territory court exercising jurisdiction under this Act, except:

(a)    if the court was exercising summary jurisdiction—an appeal, to that court or another eligible State or Territory court of the same State or Territory, as provided for by a law of that State or Territory; or

(b)    in any case—an appeal as provided for by subsection (1).

Appeals from appellate decisions of eligible State or Territory courts

(1B)    An appeal lies to the Federal Court from a decision of an eligible State or Territory court made on appeal from a decision that:

(a)    was a decision of that court or another eligible State or Territory court of the same State or Territory; and

(b)    was made in the exercise of jurisdiction under this Act.

(1C)    No appeal lies from a decision to which subsection (1B) applies, except an appeal as provided for by that subsection.

…

7    Section 565 establishes a scheme for the hearing and determination of appeals from decisions of eligible State and Territory courts exercising jurisdiction under the FW Act. Subsection (1) provides for an appeal to lie to this Court from such a decision. The effect of subs (1A) is that, if the State or Territory court was exercising summary jurisdiction, an appeal will also lie to that court or to another eligible State or Territory court, as provided for by a law of that State or Territory. The effect of subss (1B) and (1C) is that any appeal against a decision of an eligible State or Territory court made in the exercise of the subs (1A)(a) appellate jurisdiction will lie only to this Court.

8    The question concerning Judge Farrell was that of whether the Industrial Magistrate had been exercising summary jurisdiction when he determined the Appellant’s application. Her Honour appreciated that, if the Magistrate had not been exercising summary jurisdiction, the appeal from his decision did not lie to the IRCSA but instead, in accordance with s 565(1A)(b), to this Court.

9    It is apparent that there have been divergent views in the IRCSA as to whether an Industrial Magistrate hearing and determining a claim under ss 539, 545 or 546 of the FW Act is exercising summary jurisdiction. Judge Farrell considers that an Industrial Magistrate in that circumstance is not exercising summary jurisdiction, with the consequence that an appeal from the Magistrate’s decision lies only to this Court: Simon v The Bowen Family Trust (t/as Pod Squared Podiatry Centre) [2016] SAIRC 21; Bragg v GWA Group Holdings Ltd [2016] SAIRC 32. Judge Hannon, on the other hand, has concluded that an Industrial Magistrate in that circumstance is exercising summary jurisdiction: Pope Nitschke Pty Ltd (as Trustee for Pope Nitschke Unit Trust) v Parsons [2017] SAIRC 6.

10    After hearing from the parties in the present matter on 5 April 2017, Judge Farrell adjourned the matter to 4 May 2017 for directions by the Senior Judge of the IRCSA with respect to the future conduct of the appeal.

11    Senior Judge McCusker then held a case management hearing at which there was discussion of the means by which the issue as to the jurisdiction of the IRCSA to hear the appeal could be determined: a hearing by a Full Bench of the IRCSA or the referral by it of a question of law to this Court pursuant to s 26 of the Federal Court of Australia Act 1976 (Cth) (the FCA Act). It seems that the Senior Judge considered that the latter course was preferable. There was then some discussion and an exchange of correspondence concerning the framing of a question. By July 2017, the parties had agreed upon the form of the question.

12    However, there was no further hearing in the IRCSA. The next event after July 2017 appears to have been the referral on 14 December 2017 of the question to this Court. The substantive part of the document containing the referral is as follows:

Notice for a Question Reserved

With the consent of the parties a question reserved for the consideration of the Court from the South Australian Employment Court as set out in this Notice.

To the parties:

This Notice for a Question Reserved is made pursuant to section 26 of the [FCA Act].

Question reserved

1.    Has the South Australian Employment Tribunal, in Court Session as the South Australian Employment Court, jurisdiction to hear an appeal from the Industrial Magistrate in circumstances where the matter involves the entitlement under a federal award made pursuant to the Fair Work Act 2009 (Cth) and/or for the imposition of pecuniary penalties against the respondent for breaches of that Act?

2.    Attached are copies of:

2.1    Judgment of the Industrial Magistrate 24 February 2017;

2.2    Notice of Appeal 9 March 2017.

…

Date: 14 December 2017

(Signed)

Leah McLay – Registrar

South Australian Employment Tribunal

13    As can be seen, the referral does not emanate from the IRCSA but from the South Australian Employment Tribunal in Court Session (known as the South Australian Employment Court). There is, however, no indication that the SAET has ever convened to determine to make the referral. In fact, the referral seems to be constituted by an administrative act by the Registrar of the SAET.

14    The Appellant was represented at the hearing before this Court. The Respondent did not appear, although he had attended the case management hearing on 8 March 2018. He has not provided any explanation to the Court for his non-attendance.

This Court’s jurisdiction

15    The notice reserving the question to this Court indicates that the SAET considered that s 26 of the FCA Act authorised the referral. Section 26 provides:

26 Cases stated and questions reserved

(1)    A court from which appeals lie to the Court may state any case or reserve any question concerning a matter with respect to which such an appeal would lie from a judgment of the first-mentioned court for the consideration of the Court and the Court has jurisdiction to hear and determine the case or question.

(2)    Subject to any other Act, the jurisdiction of the Court under subsection (1):

(a)    if the court stating the case or reserving the question is a court of summary jurisdiction—must be exercised by:

(i)    a single Judge; or

(ii)    if a Judge considers that it is appropriate for the jurisdiction of the Court in relation to the matter to be exercised by a Full Court—a Full Court; or

(b)    if the court stating the case or reserving the question is not a court of summary jurisdiction—must be exercised by a Full Court.

(3)    A court referred to in subsection (1) shall not state a case, or reserve or refer a question concerning a matter referred to in that subsection, to a court other than the Court.

16    The effect of subs (1) is that, if an appeal may be made to this Court, the court from which the appeal lies may state a case or reserve a question concerning the matter in respect of which the appeal would lie. When a case is stated or a question reserved in those circumstances, this Court has jurisdiction to hear and determine the case or question. Conversely, if the matter is not one in which an appeal would lie to this Court, it does not have jurisdiction to hear and determine the question.

17    This means that, in the present case, this Court will have jurisdiction to hear and determine the reserved question only if an appeal would lie to this Court from a decision on the Appellant’s appeal by the SAET.

18    Section 565(1B) of the FW Act (set out earlier in these reasons) is the source of this Court’s jurisdiction to hear appeals from appellate decisions of eligible State or Territory courts. It provides that an appeal lies to this Court from a decision of an eligible State or Territory court which was “made on appeal” from a decision of the defined kind. This must be a reference to an appeal which the eligible State or Territory court had jurisdiction to hear and determine, in accordance with subs (1A). Subsection (1B) cannot sensibly be understood as referring to any other kind of appeal decision of an eligible State or Territory court.

19    For the reasons which follow, we are satisfied that, quite apart from the issue concerning the exercise of summary jurisdiction, the SAET does not have jurisdiction to hear and determine the appeal by the Appellant from the decision of the Industrial Magistrate.

The establishment of the SAET

20    In Kronen v Commercial Motor Industries Pty Ltd (trading as CMI Toyota) [2018] FCAFC 136, this Court considered the provisions concerning the establishment of the SAET and its jurisdiction. It is convenient to repeat presently some of the Court’s reasons in Kronen concerning these matters.

21    The SAET was established on 1 July 2015 by the South Australian Employment Tribunal Act 2014 (SA) (the SAET Act). Between 1 July 2015 and 30 June 2017, its jurisdiction had been confined to the hearing and determination of proceedings under the Return to Work Act 2014 (SA).

22    In 2016, the South Australian Parliament enacted the Statutes Amendment (South Australian Employment Tribunal) Act 2016 (SA) (the 2016 Amendment). Amongst other things, the 2016 Amendment provided for there to be a Tribunal in Court Session, known as the South Australian Employment Court, as part of the SAET (s 5). Sections 6-6B vested jurisdiction over specified matters in the Tribunal in Court Session. The 2016 Amendment also provided for another part of the SAET to act as an industrial relations commission. It came into operation on 1 July 2017.

23    Part 4 of the 2016 Amendment effected amendments to the Fair Work Act 1994 (SA) (the FW (SA) Act). In particular, it substituted a new Ch 2 for the existing Ch 2. Amongst other things, the SAET was thereby vested with jurisdiction to hear and determine monetary claims under industrial legislation, awards and instruments.

24    Part 4 of the 2016 Amendment contained a number of special provisions relating to monetary claims. It also contained transitional provisions in s 69. By s 69(2), the IRCSA and the Industrial Relations Commission of South Australia were dissolved. This occurred with effect from 1 July 2017. Other subsections in s 69 provided for proceedings which had, or could have, been commenced in the IRCSA to be commenced or continued in the SAET:

(11)    A determination of an industrial authority under the principal Act in force immediately before the relevant day will, on and from the relevant day, be taken to be a determination of the Tribunal.

(12)    A right to bring proceedings before an industrial authority in existence under the principal Act before the relevant day (but not so exercised before that day) will be exercised as if this Part had been in operation before the right arose, so that the relevant proceedings may be commenced before the Tribunal rather than the industrial authority.

(13)    Any proceedings before an industrial authority under the principal Act immediately before the relevant day will, subject to such directions as the President of the Tribunal thinks fit, be transferred to the Tribunal where they may proceed as if they had been commenced before that Tribunal.

(14)    The Tribunal may—

(a)    receive in evidence any transcript of evidence in proceedings before an industrial authority, and draw any conclusions of fact from that evidence that appear proper; and

(b)    adopt any findings or determinations of an industrial authority that may be relevant to proceedings before the Tribunal; and

(c)    adopt or make any determination in relation to proceedings before an industrial authority before the relevant day (including so as to make a determination in relation to proceedings fully heard before the relevant day); and

(d)    take other steps to promote or ensure the smoothest possible transition from 1 jurisdiction to another in connection with the operation of this section.

25    The term “principal Act” used in these provisions is a reference to the FW (SA) Act.

26    Counsel for the Appellant submitted that the relevant transitional provisions are those found in Schedule 1 to the FW (SA) Act. We do not accept that submission. The Schedule 1 provisions were enacted in 1994 to provide for the transition from the Industrial Relations Act 1972 (SA) to the Industrial and Employee Relations Act 1994 (SA), as the FW (SA) Act was then known. They have no application to the transition in 2017 from the IRCSA to the SAET.

27    The SAET has been declared by Regulation to be an eligible State or Territory court for the purposes of the FW Act – see the definition of “eligible State or Territory court” in s 12 of the FW Act and reg 1.05 of the Fair Work Regulations 2009 (Cth).

The jurisdiction of the SAET

28    The materials did not indicate how the SAET had come to regard itself as seized of the Appellant’s appeal to the IRCSA. It seems reasonable to suppose, however, that it had been thought by some that one of the provisions in s 69 of the 2016 Amendment had had the effect of transferring the Appellant’s appeal from the IRCSA to the SAET. In particular, subs (13) may have been thought pertinent. It provides for any proceedings (a term which would include appeal proceedings) before an “industrial authority” (a term defined to include the IRCSA) immediately before the relevant day to be transferred to the SAET, subject to such directions as the President of the SAET thinks fit, and then to proceed as if they had been commenced before the SAET.

29    In Kronen, this Court held that s 69(13) should be construed having regard to the limits of the legislative power of the Parliament of South Australia, at [52]-[53]. This led the Court to conclude that s 69(13) refers only to proceedings before an industrial authority exercising jurisdiction under the FW (SA) Act, at [57]. It does not refer to proceedings in which the IRCSA is exercising jurisdiction under the FW Act.

30    As already noted, in the present case, the IRCSA was exercising the jurisdiction vested in it by ss 539, 545 and 546 of the FW Act. Accordingly, s 69(13) of the 2016 Amendment cannot be regarded as the means by which the SAET became vested with jurisdiction to hear and determine the Appellant’s appeal.

31    For similar reasons, s 565(1A)(a) of the FW Act cannot be regarded as a source of jurisdiction of the SAET to hear the Appellant’s appeal. As previously noted, subs (1A)(a) provides that an appeal lies from a State or Territory court exercising summary jurisdiction over a matter under the FW Act to the same court or to another State or Territory court as provided for by a law of that State or Territory. On the construction of s 69(13) adopted in Kronen, it cannot be regarded as such a law. There is no other law of the South Australian Parliament providing for an appeal from a decision of the IRCSA, exercising jurisdiction under the FW Act, to lie to the SAET.

32    We have not overlooked s 69(11) of the 2016 Amendment, which provides that a “determination of an industrial authority” under the FW (SA) Act in force before the relevant day is to be taken to be a determination of the SAET. The term “determination” used in s 69(11) is not defined in the 2016 Amendment. We observe, however, that s 4 of the 2016 Amendment introduced into the SAET Act a definition of the term “decision” as follows:

decision, of a person or body (other than the Tribunal) under an Act includes a direction, determination or order of that person or body.

33    It seems therefore, that the term “determination” may have meaning which is broader than that of an order, and may encompass a decision or a finding. We are prepared to proceed on that understanding of the term, although noting that the Court did not receive any submissions on that question. However, that is of no consequence presently because, for the reasons given in Kronen, the determination cannot be regarded as a determination of the IRCSA in the exercise of jurisdiction under the FW (SA) Act.

34    Accordingly, we conclude that the SAET lacks jurisdiction to hear and determine the Appellant’s appeal. This means that an appeal would not lie to this Court from an order of the SAET on the Appellant’s appeal.

35    In Kronen, this Court held that the SAET has an implied jurisdiction under ss 545(3) and 546(1) to determine its own jurisdiction, and that an appeal from such a judgment may be to this Court. That remains the case. However, given that the jurisdiction of the SAET in the present circumstance was determined in Kronen, that implied jurisdiction cannot support the reservation of a question pursuant to s 26 of the FCA Act.

36    In accordance with the reasons in Kronen at [52]-[63], the Appellant’s appeal from the orders of the Industrial Magistrate (when made) will lie either to the IRCSA (s 565(1A)(a)) or directly to this Court (s 565(1)).

Conclusion as to jurisdiction

37    As an appeal would not lie to this Court from a judgment of the SAET on the Appellant’s appeal, the procedure under s 26 of the FCA Act is not available. Accordingly, this Court lacks jurisdiction to hear and determine the reserved question. Apart from saying that, on the basis of the submissions the Court did receive the reasons of Judge Hannon in Pope Nitschke appear to have some force, the Court declines to answer the reserved question.

38    In the light of [36] of these reasons, we will direct that a copy of this judgment be provided to the Attorney-General for the State of South Australia and to the President of the SAET.

Associate:

Dated:    27 September 2018