FEDERAL COURT OF AUSTRALIA

BGC Contracting Pty Ltd v The Construction Forestry Mining & Energy

Union of Workers [2004] FCA 417

BGC CONTRACTING PTY LTD v THE CONSTRUCTION FORESTRY MINING & ENERGY UNION OF WORKERS

W 38 of 2004

CARR J

18 MARCH 2004

PERTH

THE COURT ORDERS THAT:

1.         Until further order, the respondent, whether by its officers or authorised representatives, be restrained from exercising, or purporting to exercise any right of entry to the site known as the Ammonia Plant Construction Project on the Burrup Peninsula, Karratha, in the State of Western Australia for the purposes of holding discussions with employees of the first or second applicants or for the other purposes referred to in s 49I of the Industrial Relations Act 1979 (WA) in relation to those employees or their employment.

2.         Until further order, the respondent, whether by its officers or authorised representatives, be restrained from taking any further steps in proceedings number CR13 of 2004 in the Western Australian Industrial Relations Commission in relation to costs or otherwise.

3.         The applicants file and serve any amended Statement of Claim by 26 March 2004.

4.         The respondent file and serve a Defence and Cross-Claim by 9 April 2004.

5.         The applicants file and serve any Reply to Defence and any Defence to Cross-Claim by 20 April 2004.

6.         The applicants may file and serve any further affidavits in support of the first applicant’s motion for continuing interlocutory relief and any further written submissions on or before 25 March 2004;

7.         The respondent may file and serve its affidavits in response and any further written submissions on or before 1 April 2004;

8.         The first applicant’s motion for continuing interlocutory relief be listed for hearing on a date to be fixed.

9.         Costs of today’s hearing be reserved.

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

REASONS FOR JUDGMENT

introduction

1                     On 20 February 2004, in an ex tempore judgment given on that date, I refused an application by the applicant for an interlocutory injunction.  The interlocutory injunction sought was to restrain the respondent, by its officers or authorised representatives, from taking any further steps in certain proceedings in the Western Australian Industrial Relations Commission (“the Commission”) and also to restrain them from exercising rights of entry which they claimed under the Industrial Relations Act 1979 (WA) (“the State Act”).  But, in refusing such relief I reserved liberty to the applicant to renew its application on two days written notice.  It has now done so and there are now three applicants. 

2                     In my ex tempore reasons of 20 February 2004 I set out the factual and procedural background of the matter to that date.  I will not repeat that narration.  But these reasons are intended to be read in conjunction with those reasons and shorthand expressions in those reasons have the same references as in these reasons, save that in these reasons I refer occasionally to “Lavalin” as “SNC” and also on occasions I shall refer to the respondent as “the Union”.   

3                     In summary, officers of the respondent sought in the Commission proceedings declaratory relief that they were entitled to exercise rights of entry under the State Act.  The respondents to that application (I shall sometimes call them “the Employers”), which initially included the applicant in this matter, amongst other things, contended that by reason of the fact that all of the relevant employees had entered into Australian Workplace Agreements (“AWAs”) registered pursuant to Part VID of the Workplace Relations Act 1996 (Cth) (“the Federal Act”) the relevant provisions of the State Act did not apply.  This was either because specific provisions of the Federal Act excluded the operation of any State Award during the period of operation of the AWAs, or because the provisions of the Federal Act [Part IX Div 11A], and in particular ss 285B and 285C, govern the rights of entry to the relevant premises.  The result, so those respondents contended, was that the corresponding provisions of the State Act were inconsistent with the Federal Act provisions and, by virtue of s 109 of the Constitution, were invalid to the extent of that inconsistency.  As I understand the applicant’s case on this point, it is that such invalidity arises either because the Federal Act provisions were intended to regulate the subject matter of entry and inspection of premises and the like completely, exhaustively or exclusively, or because the provisions of the State Act alter, impair or detract from the operation of the Federal Act in those respects.  If either of those circumstances is shown to exist, s 109 of the Constitution would operate.  It is worth remembering that s 109 of the Constitution provides as follows:

‘When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid.’

4                     As at 20 February 2004, the situation was that the applicant in these proceedings had informed the Commission that these proceedings had been commenced and that, like the proceedings before the Commission, they involved a matter arising under s 109 of the Constitution.  The applicant asked the Commission to stay its proceedings until this Court had heard this matter.  The Commission constituted by Commissioner S J Kenner, refused to do so. 

5                     On Monday of this week, 15 March 2004, Commissioner Kenner published his reasons for, amongst other things, refusing the stay.  He said: 

‘First, the constitutional issue said to be agitated by the notices of answer filed by the respondents, giving rise to consideration of s 109 of the Commonwealth Constitution, is a matter quite often raised in arbitral proceedings in industrial courts and Commissions, given the federal scheme, and was not in any sense unique.  Second, and in any event, significant State issues arise in the application concerning the construction of relevant provisions of the Act [a reference to the State Act], not capable of being determined by the Federal Court [Commissioner Kenner makes no reference to this Court’s accrued jurisdiction].  Third, matters of fact may need to be established, in particular the existence and extent of coverage of AWAs under the WR Act, [a reference to the Federal Act] and their operation and effect.  This was facilitated by the Commission listing the proceedings in Karratha so such evidence could be led conveniently by the parties.  Fourth, the Commission considered the circumstances in the Woodside case as being distinguishable.  There is not identity of parties in both sets of proceedings in these matters and that both of the proceedings in the Woodside case were prosecution proceedings.  More particularly, up until as late as 17 February 2004, only days before the hearing listed in Karratha was to commence, no issue was taken by the respondents as to the Commission being the proper forum in which the issues in dispute should be heard and determined.’

6                     The Commission recognised that the respondents’ answers in those proceedings raised a matter arising under the Constitution. 

7                     The Commission (initially at least) recognised its obligation under s 78B of the Judiciary Act 1903 (Cth), not to proceed in the matter until it was satisfied that notice of the Commission proceedings had been given to the Attorneys-General of the Commonwealth and of the States, in accordance with that section.  It is not entirely clear, but it appears [Mr Kucera’s affidavit of 20/2/04 para 19(a), Mr Hotchkin’s affidavit 3 March 2004 annexed transcript pp 85 onwards] that the Commission gave a direction that notices under s 78B were to be served by facsimile on that date (i.e. Thursday 19 February 2004).  Mr T R Kucera, a solicitor employed by the Union, swore an affidavit to the effect that the Commission directed the applicant in these proceedings to serve those notices.  But from what transpired before the Commission on 23 February 2004, it is quite possible that the Commission assumed that the applicant in these proceedings would prepare and serve the notices. 

8                     Section 78B(2)(b) provides, in effect, that in a situation to which s 78B(1) of the Judiciary Act applies, a court may direct a party to give notice in accordance with s 78B.  It is perhaps unfortunate that the Commission did not make such a direction.  In any event, on 23 February 2004 the applicant undertook to the Commission that it would cause such notices to be served and I understand that it or one of the other present applicants to these proceedings did so on that date.  By “present applicant to these proceedings” I mean one of the two remaining respondents in the proceedings before the Commission, probably SNC.  I return to the decision which I made on 20 February 2004 to refuse, at that stage, to grant the interlocutory relief sought by the applicant. 

9                     I did so after finding that the applicant’s case raised serious questions to be tried and after considering, simultaneously, the balance of convenience. 

10                  At that stage it appeared that the Commission, having re-constituted the matter as an arbitration, proposed to hear evidence on matters which would include whether all of the employees of Killarnee were in fact parties to the AWAs and whether the AWAs were validly made.  I referred to that in my earlier reasons as “the AWA evidence”.  The AWA evidence was to be heard on 23 February 2004.  The Commission then proposed to adjourn until Friday 27 February 2004 to hear the questions arising under s 109 of the Constitution. 

11                  In my ex tempore reasons I expressed concern that the Commission appeared to be proceeding at a somewhat unusually precipitous pace to a consideration of an important Constitutional point.  I also expressed my provisional view that in considering questions of interpretation and application of the statutory provisions of the Federal Act and the Constitutional question, the Commission would be a “Court of the State of Western Australia” within the meaning of s 39(2) of the Judiciary Act and thus invested with federal jurisdiction to decide those matters.  I expressed the further view that this Court would have jurisdiction under s 422 of the Federal Act to hear an appeal from any orders made by the Commission.  That was because I considered that the matters which the Commission intended to consider in the following week would each be a “matter arising under” the Federal Act within s 422 of that Act. 

12                  It seemed to me that it was appropriate to allow the Commission to make its factual findings and address the Constitutional point on the basis of those findings without there then being any interlocutory orders made by this Court.  Accordingly, I refused the applicant’s application for interlocutory relief, but gave it liberty to renew the application on 2 days written notice to the Union.  It is on that basis that the matter comes back to this Court. 

13                  In the meantime, it is clear that events in the Commission proceedings took a very different course to what was anticipated. 

14                  By a letter dated 20 February 2004 to the applicant’s solicitors the Commission advised them that it had purported to sever “the s 109 constitutional issue from the proceedings on Monday 23 February 2004, with such issue to be heard by the Commission on 27 February 2004.” 

15                  At the proceedings before it in Karratha the Commission conducted an inspection of the Site and heard evidence from one officer of the Union.  The respondents to the proceedings in the Commission then elected not to call any evidence.  It appears from the affidavit evidence before me that the respondents took that course because they were of the view that the Union had not placed before the Commission sufficient evidence even to give potentially a right of entry under the State Act and that accordingly there would be no need to consider questions of inconsistency with the Federal Act and the application of s 109 of the Constitution.  

16                  The transcript of the proceedings before the Commission in Karratha suggests that the Commission at one stage understood that to be the position.  It emerged subsequently that the Commission ruled differently to some extent on the basis of “evidence” which it had taken from one of the parties before the hearing.  It sought to extend procedural fairness later by disclosing that circumstance in a letter and reconvening the matter “for mention” in Perth at very short notice. 

17                  Mr Kucera submits in effect that the respondents to the Commission proceedings had their chance to put the AWA evidence but chose not to do so and are thus stuck with their election.  Mr Kucera put that submission more eloquently than I have summarised it.  I am not satisfied that that is an accurate characterisation of what took place.  My impression of what took place in Karratha is that the respondents put what amounted to a “no case to answer” submission without being put to an election not to call any evidence.  But that can be explored more fully when the matter of continuation or not of the interlocutory relief is considered in a week or so.

18                  In its reasons published last Monday it is quite clear that the Commission was well aware of the Constitutional issue raised by the respondents to those proceedings in their answers.  The Commission referred to the Constitutional issue on numerous occasions in its reasons and in fact, at paras 5 and 48, referred to those Constitutional contentions as being “the central contentions in dispute raised by the respondents”. 

19                  The Commission appears to have regarded the fact that the respondents in those proceedings did not call any evidence or make submissions about the Constitutional point as somehow causing the Constitutional issue or issues no longer to be live issues.  On 24 February 2004, Commissioner Kenner’s Associate, presumably on his instructions, wrote to the applicant’s solicitors in these terms: 

‘As a consequence of the proceedings held in Karratha on 23 February 2004, it has become apparent that the parties no longer wish to agitate any matters relating to s 109 of the Constitution.  As a result, Commissioner Kenner has vacated the hearing date of Friday 27 February 2004.’ 

20                  The applicant asserts that the view expressed to the effect that a Constitutional issue did not arise, was based on the failure on the Union’s part to establish a factual basis for the existence of any rights under the State Act.  The Commission found against the respondents on the evidence and as a matter of construction of the State Act. 

21                  There is no evidence that the respondents to those proceedings withdrew or abandoned those parts of their answers which raised the Constitutional issue.  There is no suggestion that the answers had been amended. 

22                  In any event, it is not the conduct of the parties which exclusively governs the question whether a matter arises under the Constitution: see Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd (1999) 95 FCR 292 and the cases there discussed, in particular the judgment of Burchett J in Narain v Parnell (1986) 9 FCR 479. 

23                  The evidence shows that the Commission proposes, subject to giving the parties an opportunity to speak to a minute it has prepared, to make a declaration that representatives of the Union holding the requisite authority under the State Act are entitled to enter the Ammonia Plant premises on the Site for the purpose of holding discussions with relevant employees of Killarnee.  It originally proposed to make that declaration tomorrow afternoon, but as I understand the position it has stood the matter over for submissions about costs and the terms of the declaration to be dealt with on two separate days early next week. 

24                  On the materials before the Court, I am satisfied that the proceedings before the Commission involved a matter arising under the Constitution and that that was a real and substantial Constitutional issue which remained as a live issue in those proceedings. 

25                  Accordingly, in my provisional view, the Commission should have complied with s 78B of the Judiciary Act and furthermore should, at an appropriate time, have considered the live Constitutional issue.  It has not done so, and, in my view, it thus falls to the Court, that is this Court, to decide what should be done in all the circumstances. 

26                  The Union has sought an adjournment of the application for interlocutory relief on the basis that its preferred counsel is unavailable until next week.  I have refused that adjournment and Mr Kucera has ably put all that could be put against the grant of any interlocutory relief.  I have already held that there are serious questions to be tried.  Given the manner in which this matter has been handled by the Commission to date I consider that there is a very real risk of injustice if the Union is allowed to proceed to obtain costs and declaratory orders from the Commission. 

27                  The applicants in these proceedings should not in all the circumstances be put in a position where they are either obliged to permit the entry onto their premises of persons who would otherwise be trespassers, or refuse to admit those persons and face possible enforcement proceedings under the regime provided by the State Act.  The Union has made it quite clear this afternoon that upon the declaration being made it will seek to enforce its rights, which it considers it has, under the State Act.

28                  I consider that in order to preserve what I consider to be the status quo until there is an opportunity for fuller argument on the points in issue, short-term interim interlocutory relief should be granted to restrain the Union and its officers from further proceeding in the Commission and from attempting to exercise any rights conferred under the State Act until further order.  I will also make directions for the filing of further affidavits and submissions and for the matter of the continuation, or otherwise, of this interim relief to be heard at a date mutually convenient to all parties, and to the Court.

Associate:

Dated:            15 April 2004