FEDERAL COURT OF AUSTRALIA

Maritime Union of Australia v Geraldton Port Authority [2001] FCA 236

INDUSTRIAL LAW – contravening conduct - application for orders varying judgment to impose penalty – power of court to so act pursuant to rules – whether change in circumstances sufficient to support exercise of discretion in all the circumstances – effect on discretion of knowledge by applicant for variation of possibility of change

PROCEDURE – power to vary orders previously made – whether power extends to permitting new order where change in circumstances on which final orders previously based - effect on discretion of knowledge by applicant for variation of possibility of change

Federal Court Rules O 35 r 7, O 36, O 37 r 6

Gamser v Nominal Defendant (1977) 136 CLR 147, applied

Gamser v Nominal Defendant [1976] 1 NSWLR 520, referred to

Bailey v Marinoff (1971) 125 CLR 529, distinguished

Permewan Wright Consolidated Pty Ltd v Attorney-General; Ex rel Franklins Stores Pty Ltd (1994) 35 NSWLR 365, considered

Coffs Harbour Environment Centre Inc v Minister for Planning (1994) 84 LGERA 324, referred to

QDSV Holdings Pty Ltd v Trade Practices Commission (1995) 59 FCR 301, referred to

Wentworth v Woollahra Municipal Council (1982) 149 CLR 672, applied

State Rail Authority of New South Wales v Codelfa Construction Pty Ltd (1982) 150 CLR 28, cited

Smith v New South Wales Bar Association (1992) 176 CLR 256 at 265, applied

Allstate Life Insurance Co v Australia & New Zealand Banking Group Ltd (1995) 133 ALR 267 at 677, cited

Autodesk Inc v Dyason (1993) 176 CLR 300 at 302, applied

Yenald Nominees Pty Ltd v Como Investments Pty Ltd (1996) ATPR 41 – 508 at 42362, applied

The Texas Company (Australasia) Limited v FCT (1940) 63 CLR 382 at 457, cited

Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union (2000) 74 ALJR 1034, applied

MARITIME UNION OF AUSTRALIA AND PETER WINCH-BUIST, PAUL ARTHUR, CLIVE LAURISTEN, STEVEN PENNEY V GERALDTON PORT AUTHORITY AND ERIC CHARLTON AND MURRAY CRIDDLE

WAG 98 and 101 of 1998

RD NICHOLSON J

16 MARCH 2001

PERTH

THE COURT ORDERS THAT:

The applicants’ motion dated 10 April 2000 be refused.

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

REASONS FOR JUDGMENT

1                     These reasons are to be read in continuity with the reasons delivered in this proceeding on 19 September 2000.  Those in turn followed reasons delivered on 5 July 1999 which had led to the final orders on 10 February 2000.  These reasons address the issue which was the subject of written submissions following orders made on 19 September 2000.  The second and third respondents played no part in this further aspect of the proceeding.

2                     The question addressed in the written submissions and to be resolved in these reasons is whether it is open to the Court to act pursuant to the Federal Court Rules (“FCR”) to vary or change the final orders.  In the reasons of 19 September 2000 the parties were invited to consider whether those orders could be amended so as to provide for a finite penalty on the GPA in respect of the contravening conduct and, additionally, the nature and quantum of any such penalty on the basis the requirement to make the employees available for hire stevedoring work would be removed from the final orders.  In the reasons delivered on 14 January 2000 the Court had refused to make an order imposing a penalty on the GPA because:

“The nature of the injury or prejudicial alteration to be addressed is the prospect of a reduction of overtime.  Provided relief dates from the point in time when that prospect arose, there is no actual injury or prejudicial alteration to the Second Applicants or the MUA employees”.

In the reasons of 19 September 2000 the Court said:

“I find that the effect of the methodology utilised by the GPA was to frustrate the final orders.  This was because the increased rates resulted in an application of the methodology did not result in the GPA’s stevedoring labour being utilised in the market place”.

It is the new event of increased rates occurring after the pronouncement of final orders which has given rise to the application for variation of final orders.

Whether O 37 r 6 permits variation

3                     In the first instance the motion to amend the final orders was supported by reference to O 37 r 6 of the FCR.  Relevantly, that rule provides:

“(1)     A person bound by a judgment may move the court for a stay of execution of the judgment, or for some other order, on the ground of matters occurring after the date on which the judgment takes effect and the court may make such order as the nature of the case requires.”

4                     The principal authority on O 37 r 6 and rules in similar form is the decision of the High Court in Gamser v Nominal Defendant (1977) 136 CLR 147.  There the plaintiff had, at first instance, been awarded $160,000.00 for damages for negligence causing personal injury.  The defendant appealed from that judgment and was successful, the New South Wales Court of Appeal reducing the award to $125,000.00.  After the decision of the Court of Appeal the plaintiff applied for an order that its judgment be set-aside on the ground that events occurring since judgment had caused his condition to deteriorate.  In making the application the plaintiff relied inter alia on Pt 42, r 12 of the Supreme Court Rules 1970 (NSW) which was in identical terms to FCR O 37 r 6.

5                     The Court of Appeal refused the application:  Gamser v Nominal Defendant [1976] 1 NSWLR 520.  Glass JA (with whom Moffitt P and Hutley JA agreed) held there were two reasons why the rule, upon its proper construction, failed to allow the order which the plaintiff sought.  He said at 522:

“In the first place, the phrase “a person bound by a judgment”, having regard to the appearance of similar phraseology in other rules in Part 42, headed “Judgments and Orders: Enforcement”, and, in particular, having regard to the contrast it affords with the phrase “a person entitled under a judgment” contained in Rule 11, would include the defendant in this case, but not the plaintiff.”

The second reason given by Glass JA was:

“The phrase “some other order”, having regard to the general character of Part 42, would not, in my opinion, include, upon its proper construction, an order setting aside a judgment regularly entered.”

6                     The plaintiff appealed to the High Court.  His appeal was dismissed.  Aickin J (with whom the other members of the Court agreed) agreed with Glass JA that Pt 42, r 12 did not confer power on the Court to make the orders sought by the plaintiff.  Aickin J found it unnecessary to decide whether the plaintiff was “a person bound by a judgment”:  Gamser v The Nominal Defendant (1976) 136 CLR 145. Aickin J said (at 153):

“Whether or not the appellant is a person bound by a judgment within the meaning of that Rule, the context makes it clear that the kinds of order contemplated do not include one setting aside a judgment regularly entered.”

In agreeing with the reasons of Aickin J, Gibbs J said:

“I regard it as unfortunate that the inherent power of an appellate court does not extend to varying its own orders when the interests of justice require it.  It is of course a most important principle, based on sound grounds of policy, that there should be finality in litigation.  However, exceptional cases may arise in which it clearly appears from further evidence that has become available that a judgment which is being given rested on assumptions that were false and that it would be manifestly unjust if the judgment were allowed to stand.  In my opinion it is desirable that the Court of Appeal should have a discretion – however guardedly it might have to be exercised – to reopen its judgments in cases such as that in which the needs of justice require it.  I agree, however, that the decision in Bailey v Marinoff shows that the Court of Appeal lacks that inherent power.”

7                     In Bailey v Marinoff (1971) 125 CLR 529 it was held by a majority of the High Court (Barwick CJ, Menzies, Owen and Walsh JJ, Gibbs J dissenting) that there was no inherent power in a court to deal further with an appeal which has already been dismissed by formal order, in conformity with an order pronounced, where the order was entered before an application to vary it was made.  Here, of course, the issue is not one of inherent power but of the scope of O 37 r 6.

8                     I accept the submission for the applicants that they clearly satisfy the description of persons bound by the judgment, even in the narrow sense outlined by Glass JA which was left open by Aickin J in the High Court. 

9                     The “other order” which the applicants seek to move the Court to make is the imposition of a penalty on the GPA.  This is exactly the same order as the applicants sought in their submissions dated 26 July 1999 and in later “Submissions of the Applicants in Reply to those of the First Respondent Regarding Relief”, pars 21 – 24.  It is apparent that if the Court made orders as moved on behalf of the applicants it could only do so by setting aside portion of the orders made on 10 February 2000.  For the GPA it is therefore submitted that this Court being bound by the decision of the High Court in Gamser, it cannot take that step because to do so would be to set aside a judgment which has been regularly entered.  Consequently it is said the applicants cannot invoke the aid of O 37 r 6. 

10                  For the applicants it is sought to distinguish Gamser from other authorities addressing the effect of rules in similar terms to O 37 r 6.  There are three such authorities relied on.

11                  The first, in date order, is Permewan Wright Consolidated Pty Ltd v Attorney General; Ex rel Franklins Stores Pty Ltd (1994) 35 NSWLR 365, decided on 11 December 1978.  The case considered Pt 42, r 12 of the Supreme Court Rules 1970 (NSW).  A motion sought the dissolution, variation or staying of an order of the Court of Appeal.  The order in question was an injunction relating to the use by the applicant company of certain land.  The Court held that it had power pursuant to the rule to stay or suspend the operation of its injunctive order on the ground of matters occurring after its date.  Reynolds JA at 367 said such stay or suspension was analogous to staying the execution of a judgment.  He accepted that the ratio of Gamser was that neither the power in the rule nor the inherent power of the Court extended so far as to allow the changing or dissolution of an order regularly made and entered (at 367).  There was therefore a distinction drawn between the changing or dissolution of an order, which was regarded within the ratio of Gamser, and the staying or suspending of the operation of an order.  The particular circumstances which arose in Permewan were that because of a change in the applicable planning law the injunction was no longer warranted.  Hutley JA approached the matter in a different way and did not decide the point.  Mahoney JA considered that the Court had power, by an appropriate order, to ensure that its order does not operate after the statutory basis upon which it was made ceases to exist.  He was inclined to the view that apart from the rules, the Court must have power in any event (at 374).

12                  The second authority is Coffs Harbour Environment Centre Inc v Minister for Planning (1994) 84 LGERA 324 Kirby P at 335, in considering whether the Court had jurisdiction to hear and determine an application to discharge or otherwise vary injunctive relief previously granted, referred to Pt 42 r 12(1) of the Supreme Court Rules 1970 (NSW) and the statement by Mahoney JA in Permewan.  He said (at 336):

“Although Permewan Wright concerned an appeal from the Equity Division of the Supreme Court, the suggestions put forward by Mahoney JA that the rule, and indeed the inherent jurisdiction of the Court, provide powers to vary orders after the conclusion of the hearing seems applicable to circumstances where an injunction is no longer warranted because of a change in the applicable planning law, as in the circumstances of this case.”

13                  The third authority is QDSV Holdings Pty Ltd v Trade Practices Commission (1995) 59 FCR 301.  Sackville J at 315 said:

“Moreover, the Court has jurisdiction to dissolve a permanent injunction in circumstances where legislation has removed the foundation for the grant of the injunction: Commonwealth Scientific and Industrial Research Organisation v Perry at 558; Coffs Harbour Environment Centre Inc v Minister for Planning (1994) 84 LGERA 324 at 335 – 336, per Kirby P.  Additionally, O 37 r 6 of the Federal Court Rules 1979 (Cth) makes specific provision for a party bound by a judgment to move the Court for orders on the ground of matters occurring after the date of the judgment.  This provision gives the Court jurisdiction to vary or dissolve a permanent injunction: Coffs Harbour at 335, per Kirby P.  Thus, if the Bill were ultimately passed by the Parliament in its present form, and if it were thought to authorise conduct by the appellant which is restrained by the Court’s order, it would be open to the appellant to apply to the Court to dissolve or modify the order.”

14                  For the applicants it is submitted that the present circumstances are no different in principle from the continuance of injunctions in circumstances where the legal foundation for them may have changed.  The basis of that submission is that there has been, here, a change in circumstances which has rendered nugatory those considerations which led the Court not to impose a penalty.  In my opinion this submission cannot be accepted on the basis of the authorities referred to.

15                  I accept the submission for the GPA that the decisions in the cases since Gamser are authority for the proposition only that a rule in the form of O 37 r 6 gives the Court power, on application by a party upon whom an injunction imposes obligations, to ensure that an injunction does not continue to operate where the statutory basis for its operation has ceased to exist.  The decisions in Permewan, Coffs Harbour and QDSV do not support an argument that O 37 r 6 empowers a court to set aside a judgment regularly entered.  That was made explicit by Reynolds JA in the passage previously referred to in Permewan at p 367.  Accordingly, I consider that it is not possible to distinguish the application of Gamser from the present application and that Gamser is a barrier to the Court making the “other order” as is sought for the applicants provided the judgment was “regularly entered”. 

16                  However, examination of the file in this proceeding discloses that the final orders have not in fact been entered.  The entry of judgments and orders is the subject of O 36 of the FCR.  The final orders were of a type which required entry pursuant O 36 r 8(2).  For the purposes of the application of the ratio in Gamser, the non-compliance with that rule has the consequence that the final orders were not “regularly entered”.  The result is that Gamser is not an obstacle to the application of that rule. 

17                  It is however, strictly unnecessary to further consider reliance on O 37 r 6 because the effect of the judgment not having been entered is that the provisions of another rule are more relevant.

Whether O 35 r 7 applicable

18                  Order 35 r 7 of the FCR sets out the circumstances in which a judgment or order may be set aside.  The rule draws a distinction between judgments or orders which have not been entered and judgments or orders which have been entered.  In relation to the former the Order provides “the Court may vary or set aside a judgment or order before it has been executed”.

19                  The authorities show that the circumstances in which the High Court will reopen a judgment which it has pronounced are “extremely rare”.  A relevant consideration in this regard is the public interest in maintaining the finality of litigation which necessarily means that the power to reopen to enable a rehearing must be exercised “with great caution”:  Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 684, citing State Rail Authority of New South Wales v Codelfa Construction Pty Ltd (1982) 150 CLR 28.  It is therefore a matter for the exercise of judicial discretion having regard to the appropriate circumstances as to whether the power in the rule should be exercised:  Smith v New South Wales Bar Association (1992) 176 CLR 256 at 265; Allstate Life Insurance Co v Australia & New Zealand Banking Group Ltd (1995) 133 ALR 267 at 677 per Lindgren J.  The appropriate tests have been formulated with different words and different scope in varying judgments.

20                  The formulations to which regard must be had are as follows: -

(1)               “Generally speaking, it [the discretion] will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard”:  Wentworth at 684 per Mason ACJ, Wilson and Brennan JJ, cited with approval by Mason CJ in Autodesk Inc v Dyason (1993) 176 CLR 300 at 302.  In Autodesk Brennan J at 308 said that a court should not pronounce a judgment against a person on a ground which that person has not had an opportunity to argue for to do so would be a denial of natural justice.

(2)               The power will only be exercised if there is “some matter calling for review”:  Smith at 265.

(3)               There may be more or less reluctance to exercise the power depending on whether there is an avenue of appeal:  Smith at 265, citing Codelfa at 38 – 39, 45 – 46 and Wentworth at 394 – 395.

(4)               The power will not ordinarily be exercised “to permit a general reopening”:  Smith at 265, citing Ritchie’s Supreme Court Procedure, New South Wales, vol 1, p 2855.

(5)               It is necessary for the court to consider whether it has proceeded on a misapprehension as to the facts or the law:  Autodesk at 302 per Mason CJ.  What must emerge, in order to enliven the exercise of the jurisdiction, is that the court has apparently proceeded according to some misapprehension of the facts or the relevant law and that is misapprehension cannot be attributed solely to neglect or default of the party seeking the rehearing:  Autodesk at 303 per Mason CJ.

(6)               The power is not to be exercised for the purpose of reagitating arguments already considered by the Court:  Autodesk at 303 per Mason CJ.

(7)               Nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put:  Autodesk at 303 per Mason CJ.

(8)               It will be relevant whether the decision has been given in ignorance or forgetfulness of some statutory provision or of some critical fact:  Autodesk at 310 per Brennan J,

(9)               What is at issue is the interests of justice and whether they require judgment to be set aside:  Autodesk at 322 per Gaudron J, citing Smith and adding that such circumstances will be extremely rare particularly if there has been an opportunity for full argument.

(10)           It will be appropriate to consider whether the review of the contemplated order is necessary so that the orders made deal more adequately with the matter as litigated by the parties before the Court:  Yenald Nominees Pty Ltd v Como Investments Pty Ltd (1996) ATPR 41 – 508 at 42362 per Lee J citing The Texas Company (Australasia) Limited v FCT (1940) 63 CLR 382 at 457 per Starke J.

21                  It is with these formulations in mind that I approach the exercise of the discretion arising either under O 35 r 7(1) (or O 37 r 6).

Whether discretion should be exercised in favour of amendment

22                  There is one new factual development since the making of the final orders.  On 12 January 2001 Vice President Ross made orders in proceedings between the first applicant, The Australian Maritime Officers’ Union and the GPA.  The effect of the orders, it is submitted for the GPA, was to terminate the operation of the Award and replace it with the Geraldton Port Authority Award 2001 (“the Varied Award”).  It is said the effect of that is that the employees are no longer employed by the GPA on the terms and conditions set out in the Award and the Agreement.  Therefore, it is said, the GPA is no longer required by the final orders to make the labour of its employees available for hire to stevedores operating in the Port of Geraldton.  Additionally it is said the provision of labour to stevedores by the GPA was underpinned by clauses 9 (the definitions of “Operational Agreement” and “Operational Employer”), 47 and, in particular, 48(2) of the Award.  These have been omitted in the Varied Award.  It is therefore submitted for GPA that it is inappropriate to vary the final orders because they have ceased to be effective and any obligation to provide labour imposed by the Award has ceased.

23                  I accept the submission for the applicants that the making of the Varied Award does not affect the determination of the motion before me.  The issue of penalty arises in relation to the time of the commission of the breach of s 298K and that predates the Varied Award.  Furthermore, the final orders do not require reliance on the Operational Agreement.  Additionally the making of the Varied Award occurred pursuant to item 51 to Pt 2 of Sch 5 of the Workplace and Other Legislation Amendment Act 1996 (Cth) which required the Commission to vary an award to remove provisions ceasing to have effect by virtue of item 50 of the Schedule.  I accept this required and led to a variation rather than the making of a new award:  cf. Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union (2000) 74 ALJR 1034.  It is therefore arguable that the employees did not, in terms of par 3(a) of the final orders, cease to be employed by the GPA on the terms and conditions in the Award.  As it is not necessary to do so, I make no final determination of that point.

24                  In my view there are significant circumstances which must weigh against varying or setting aside the orders made on 10 February 2000, namely:

(1)               The issue of whether a penalty should be imposed on the GPA in respect of the contravening conduct established was a (or the) central issue in the proceeding.  It was fully argued.  This is not a case where the issue the subject of the variation sought was not argued in all its aspects or not argued as well as it might have been put.  The application for variation is therefore in the category of being extremely rare. 

(2)               Because of the centrality of the issue of penalty to the proceeding, the variation sought would constitute a general reopening.  Certainly the variation would have the effect of regurgitating arguments already considered by the Court.

(3)               The applicants were aware of the possibility of fee increases before the final orders were made but did not bring this to the attention of the Court.  While the increase then known was smaller than that occurring after final orders, had the Court been aware of the possibility of the fee rates increasing it could have considered that aspect in shaping its orders.  The quantum of the latest increase cannot justify the Court reopening issues of which the applicants were aware in principle when the final orders were made.

(4)               This is not a case of a variation directed to crafting the orders to deal more adequately with the matters addressed in them.

25                  I therefore consider the weight of circumstances is against the exercise of the discretion arising under FCR O 35 r 7 (or O 37 r 6).  Accordingly, the applicants’ motion should be refused.

Associate:

Dated:              16 March 2001