FEDERAL COURT OF AUSTRALIA

Commonwealth Bank of Australia v Finance Sector Union of Australia [2003] FCAFC 212

PRACTICE AND PROCEDURE – leave to appeal – whether to stay enforcement of award proceeding pending determination of an application to vary the award – whether trial of a separate question in form proposed by the respondent should proceed – prospect of application to vary the award being heard by the Australian Industrial Relations Commission - whether substantial injustice if leave were refused

Workplace Relations Act 1996 (Cth) s178

In re the Will of F B Gilbert (dec) [1946] 46 SR (NSW) 318, referred to

Adam P Brown Male Fashions Proprietary Limited v Philip Morris Incorporated (1981) 148 CLR 170, referred to

Decor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397, referred to

Community & Public Sector Union v Crown in Right of Victoria (1999) 90 IR 16, referred to

COMMONWEALTH BANK OF AUSTRALIA v FINANCE SECTOR UNION OF AUSTRALIA AND JOSEPH ADAMS

N1068 OF 2000

WILCOX, MARSHALL AND MERKEL JJ

22 AUGUST 2003

SYDNEY

THE COURT ORDERS THAT:

The applications for leave to appeal be dismissed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

WILCOX J:

1                     There are before the Court two applications for leave to appeal from interlocutory orders made by Moore J.  The applications arise in a proceeding pending in his Honour's list involving a claim by the Finance Sector Union of Australia (‘the Union’) and Joseph Adams for relief in respect of the alleged non-compliance with an industrial award by the Commonwealth Bank of Australia (‘the Bank’).  The Bank is the applicant for leave to appeal.

2                     In my view, the applications must be dismissed for quite pragmatic reasons.  I bear in mind that each of the decisions made by his Honour was a matter of practice and procedure, and a discretionary judgment.  It seems to me, and with respect to his Honour, that not only was the view that he took open to him, but also it would have been extremely difficult for him to have reached any other view having regard to the circumstances with which he was confronted.

3                     In order to justify that statement I should refer briefly to the history of the matter.  I am assisted by a chronology of events which has been prepared by counsel for the applicant.

4                     On 5 October 2000, the proceeding was instituted in this Court, being N1068 of 2000.  On 3 April 2001 and, admittedly, in response to the proceeding in this Court, the Bank made an application to the Australian Industrial Relations Commission (‘the Commission’) pursuant to section 113(2) of the Workplace Relations Act 1996 (Cth) to vary the award provision that was the subject of the application in this Court.  The Commissioner assigned to that application the number C2001/1820.

5                     One week later, the Bank made an application by way of notice of motion in this Court that proceeding N1068 of 2000 be stayed pending final determination of application C2001/1820 by the Commission.  Before that motion could be considered by the Court, a decision was made by Senior Deputy President Duncan in the Commission that proceeding C2001/1820 should be adjourned generally.

6                     Proceeding N1068 of 2000 happened to have been allocated to my docket, but I became aware that there was pending in the docket of Moore J a proceeding which has been generally referred to as the ‘Macey proceeding’ involving the same parties and requiring construction of at least some of the same provisions of the relevant award.  Taking the view that it was undesirable that there be two separate proceedings dealt with by different judges at the one time, and with the concurrence of the parties and Moore J, I transferred N1068 of 2000 to his Honour's list.  That was done on 9 July 2001.

7                     On 1 August 2001, Moore J decided to adjourn N1068 of 2000 pending the outcome of the Macey proceeding.  As that case went to a Full Court, there was some delay in that outcome.  In the meantime, on 4 April 2002, Senior Deputy President Duncan had been asked to proceed with proceeding C2001/1820.  However, on 4 April 2002, and for reasons which he gave, he declined to take that course.

8                     On 27 August 2002, the Union and Mr Adams decided to proceed with proceeding N1068 of 2000 having regard to the decision of the Full Court in the Macey proceeding.  There was an application by the Bank for a trial of a separate question in that proceeding.  On 20 November 2002, Moore J dealt with two issues.  First, whether there should be a stay of proceedings in N1068 of 2000 and, second, whether there should be any separate question and, if so, its form.  On 7 February 2003, his Honour handed down a judgment in which he refused the Bank's application for an order staying the proceedings.

9                     After a later hearing on 23 April 2003, his Honour made a decision about the separate question.  His judgment was given on 27 May 2003.  It was after that date, namely on 11 June 2003, that Senior Deputy President Duncan decided to ‘un-adjourn’ proceeding C2001/1820.  The Senior Deputy President has subsequently set down that matter for hearing before him over six days in September; that is to say, in a few weeks time.  In the meantime, Moore J has fixed the hearing of N1068 of 2000 to commence upon 8 March 2004.

10                  It seems to me that the situation with which Moore J was confronted when he dealt with each of the matters, the subject of the current applications for leave to appeal, was that although an application had been made to the Commission as long ago as April 2001, by the deliberate decision made on two separate occasions of Senior Deputy President Duncan, the Commission was not proceeding with the hearing of that application.  The reason, apparently, was that Senior Deputy President Duncan took the view - rightly, or wrongly - that it was better for the proceeding in this Court to be heard first.

11                  Moore J, of course, had no control over the actions of the Commission.  He was confronted with a situation that there was no immediate prospect of the Commission dealing with the variation application, on the one hand and, on the other, that he had before him applicants who were entitled to come to the Court to take action to enforce the award and were anxious to press on with the matter and obtain a hearing.  It seems to me that it was not only open to Moore J to take the view that under those circumstances it would be wrong to stay the matter before him; but also, as I have said before, that I think he could not responsibly have come to any other conclusion.

12                  The separate matter concerning the form of the separate question is conceded by Mr Walker, senior counsel for the Bank, to involve, really, the same point.  It is unnecessary to go into the details of the form of the question propounded by his client, as compared with the form of the question propounded by the Union and Mr Adams and which was favoured by his Honour.  Mr Walker's concession that this really comes down to the same point about a stay, relieves me from going into that area.

13                  It is worth emphasising that even as recently as the time when his Honour dealt with the separate question, the matter in the Commission had yet to be un-adjourned.  In my view this is not a case for the Court to give leave to appeal.

Associate:

Dated:              1 September 2003

REASONS FOR JUDGMENT

MARSHALL J:

14                  The two applications before the Court for leave to appeal from two interlocutory judgments of Moore J may be described as follows.

15                  The first application concerns his Honour's refusal to stay a proceeding in his docket (“the substantive proceeding”) pending the determination of an application to vary the industrial award, which is being sought to be enforced in the substantive proceeding. 

16                  The second application concerns his Honour's decision pursuant to O29 r2 of the rules of Court to order the trial of a separate question, in a form proposed by the respondents and opposed by the applicant.

17                  The current question for determination is whether leave to appeal should be given in respect of the two interlocutory judgments of his Honour refusing to stay the substantive proceeding and framing a separate question in accordance with the proposal by the respondents. 

18                  The substantive proceeding is an application made under s178 of the Workplace Relations Act 1996 (Cth) (“the Act”) to enforce a consent award (“the award”) made by the Australian Industrial Relations Commission (“the Commission”).  The substantive proceeding is also a representative proceeding which is brought by the respondents as representative parties on behalf of a class of persons alleged to have been affected by the asserted breach of the award (“the group members”).  In addition, the application alleges breach of contract in reliance upon the accrued jurisdiction of the Court.

19                  The respondents filed the substantive proceeding on 5 October 2000. They claim that the applicant was in breach of its obligation to make redundancy payments to the group members. 

20                  On 3 April 2001, the applicant filed in the Commission an application to vary the award pursuant to s113 of the Act.  The application sought to relieve the applicant from any liability to make redundancy payments to the group members. 

21                  On 10 April 2001, the applicant filed a notice of motion in the Court seeking that the substantive proceeding be stayed pending determination by the Commission of the award variation application.  That motion was not heard until 20 November 2002.

22                  In the meantime, on 20 June 2001, the Commission granted an application by the first respondent to adjourn generally the award variation application. 

23                  On 1 August 2001, the substantive proceeding was adjourned generally pending the outcome of a related proceeding. 

24                  On 26 September 2002, the applicant filed a motion seeking a hearing of a separate question under O29 r2 of the rules of Court.  The separate question posed by the applicant, in summary, sought a determination of whether the applicant was obliged to treat the group members as being in a redundancy situation for the purposes of the award.  Subsequently on 13 March 2003, the respondents sought the hearing of a differently framed separate question.  That question, in summary, sought a determination of whether on a true construction of the award the group members are entitled to severance pay from the applicant.

25                  On 20 November 2002, Moore J heard the applicant's stay application.  His Honour published his reasons for rejecting that application on 7 February 2003.  At [9] of his reasons for judgment, Moore J said:

“In my view, the appropriate approach is not to stay the principal application. Whatever rights are presently conferred and liabilities imposed by the Award will be determined in the principal application. The Court has a duty to determine that application: see the judgment of Gray J inMcGarry v Boonah Clothing Pty Ltd (supra) and the authorities referred to and Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at [19]. It is not appropriate to refrain from exercising that duty simply because one party wishes to take steps, potentially, to alter the rights and liabilities of the parties to the litigation in the Court. If, as the applicants contend, Mr Adams and group members were entitled to redundancy pay under the Award (as it was framed at the relevant time) when they left the employment of the Bank, that is a legally enforceable right the applicants are entitled to vindicate by proceedings in the Court. Assuming the existence of such a right and that the Commission can and would wish to alter those rights on the application of the Bank, that is a matter for the Commission. There is no reason why the Commission cannot, in the course of dealing with any application to vary the Award and for the purpose of determining such an application, interpret the Award. However even if the Commission took the view that it should hear the Bank´s variation application (notwithstanding its earlier decision to adjourn the variation application generally though made apparently by reference to a position then adopted by the Union which has altered) the Court´s duty would continue to be to hear and determine the principal application. If the Award was varied before judgment was given then the legal effect of the variation would, if raised as an issue which was relevant, have to be determined in the principal application.”

26                  On 23 April 2003, Moore J heard the motions dealing with the request of the parties for separate questions to be heard and determined pursuant to O29 r2.  On 27 May 2003, his Honour published his reasons for judgment on the separate questions issue.  At [8] of his reasons for judgment, Moore J said:

“…The question formulated by the Bank invites determination of the question of whether there is a redundancy situation but not the determination of residual issues if that question is not answered in the Bank´s favour. It is, in a sense, a threshold question, the answer to which determines whether other questions arise and need to be answered. The question formulated by the applicants requires consideration of not only that threshold question but, if the threshold question is answered in a particular way, other questions. Those other questions, when answered, would determine whether the members of the representative group follow a path leading to an entitlement to severance pay. The controversy between the parties is ultimately whether there was such an entitlement.”

27                  On 11 June 2003, the Commission decided to list the award variation application for programming.  On 2 July 2003, at the programming mention, the Commission set the award variation matter down for hearing on various dates in mid to late September 2003.

28                  Each judgment of Moore J, subject to the application for leave to appeal, was an interlocutory judgment.  The judgment in the stay application essentially amounted to a decision not to indefinitely adjourn the substantive application.  The judgment in the separate question application essentially amounted to an exercise by a docket judge of his discretion on an issue concerning the proper management of the proceeding.  Each judgment is one which concerns issues of practice and procedure and in respect of which leave to appeal ought not be lightly given; see In re the Will of F B Gilbert (dec) [1946] 46 SR (NSW) 318 at 323 and Adam P Brown Male Fashions Proprietary Limited v Philip Morris Incorporated (1981) 148 CLR 170 at 177.

29                  Leave to appeal will be granted if the decision below is attended with sufficient doubt to warrant it being reconsidered by a Full Court and it would occasion substantial injustice if leave were refused, supposing the decision to be wrong; see Decor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 at 398-400.

30                  No substantial injustice arises as a result of the challenged decisions. The significance of Moore J’s failure to stay the substantive proceeding has largely been overtaken by the decision of the Commission to list the award variation application for hearing next month.  It is highly likely that the matter will be heard and determined prior to the commencement of the hearing of the substantive matter. 

31                  In any event, Moore J was correct to refuse to stay the substantive application.  At the time Moore J refused to stay the substantive application, the award variation application was adjourned generally in the Commission.

32                  The role of the Court in award enforcement proceedings is a different one to the role of the Commission in award variation applications.  The task of each body is significantly different; see Community & Public Sector Union v Crown in Right of Victoria (1999) 90 IR 16 at 17-18, [1999] FCA 744 at [11] and [12].  In addition, in the instant circumstances the substantive proceeding concerns a question of alleged breach of contract which arises in the accrued jurisdiction separately from the award enforcement claim.

33                  No question arises concerning competing claims in respect of identical issues in separate courts.  The Commission is not a court. It is an administrative tribunal. It has no judicial role.  Reference to judgments concerning one court staying its proceedings to enable another court to deal with the matter before it is entirely beside the point.  References to judgments concerning the Industrial Relations Commission in New South Wales in court session are not analogous to issues in which the Commission has a function because the New South Wales body, when sitting in court session, exercises a judicial function.

34                  An answer to the separate question which his Honour intends to hear in March 2004 will, if unfavourable to the applicant, not result in any monetary orders being made against it.  It will be open to it to appeal from any adverse judgment in that regard prior to Moore J having to deal with issues which may arise under s178(6) of the Act, let alone any damages arising from breaches of contract.  No immediately foreseeable prejudice is occasioned to the applicant by his Honour dealing with that question.

35                  Moore J’s judgment to favour the separate question posed by the respondents is unexceptional.  As his Honour noted at [8], the question posed by the applicant may lead the necessity for further questions to be asked beyond a mere threshold question.  In any event, it may be that the hearing of the separate question by Moore J in March 2004, and indeed the timing of it, may require further consideration pending the outcome of the award variation application.  In a real sense this demonstrates the premature nature of the application for leave to appeal and the inherent lack of unfairness to the applicant if the judgments, subject to the application for leave, are left to stand.

36                  I would order that each application for leave to appeal be dismissed.

Associate:

Dated:              1 September 2003

REASONS FOR JUDGMENT

MERKEL J:

37                  I agree that the application for leave to appeal should be refused.  The primary judge was confronted with the possibility of prejudice to the applicant if he refused to grant the orders it was seeking and with the possibility of prejudice to the respondents if he granted the orders the applicant was seeking.

38                  His Honour was required to exercise his discretion in relation to how best to proceed in that situation.  I am not satisfied that his Honour’s decisions to refuse to make the orders sought by the applicant staying the proceeding and trying the question proposed by the applicant are attended by sufficient doubt to warrant the grant of leave to appeal.

Associate:

Dated:              1 September 2003