FEDERAL COURT OF AUSTRALIA

United Group Resources Pty Ltd ABN 17 114 888 201 v Calabro (No 2) [2010] FCA 71

THE COURT ORDERS THAT:

1          Upon the applicants having given the usual undertaking as to damages, until 5.00 pm on 18 February 2010 or further order, pursuant to s 39 and/or s 49(1)(c) of the Building and Construction Industry Improvement Act 2005 (Cth) each respondent is restrained from:

(a)        engaging in or being a party to or in any way associated with or otherwise involved in any of the following actions in relation to building work on the Pluto LNG Project at Burrup Peninsula (Project):

(i)         failing or refusing to attend work on the Project or failing or refusing to accept or perform work on the Project at all;

(ii)        performing work on the Project otherwise than in accordance with the terms of his employment contract;

(iii)       performing work on the Project in a manner different from that in which it is customarily performed, or adopting any practice in relation to work on the project, the result of which is a restriction or limitation on, or a delay in, the performance of that work;

except where such actions:

(i)         are authorised or agreed to by the respondent’s employer; or

(ii)        are based upon the respondent’s reasonable concern about an imminent risk to the respondent’s health or safety and the respondent has not unreasonably failed to comply with the directions of the respondent’s employer to perform other available work, whether at the same or another workplace, that was safe and appropriate for the respondent to perform;

(b)        interfering with or in any way disrupting the performance of work on the Project by any of the following means:

(i)         imposing, maintaining or aiding, abetting, encouraging, directing, procuring, inducing, advising or otherwise being involved in any bans, limitations, restrictions or delays on the performance of work or the acceptance of work by any of the applicants’ other employees to be performed under their terms of employment or in a manner which work is customarily performed with the applicants; and

(ii)        imposing, maintaining or aiding, abetting, encouraging, directing, procuring, inducing, advising or otherwise being involved in the taking of days off by any of the applicants’ other employees otherwise than in accordance with rosters specified by the industrial instruments and employment contracts regulating their employment with the applicants.

2          Any further application for an interlocutory injunction be listed for hearing at 10.00 am on Thursday 18 February 2010 together with a directions hearing.

3          Any person affected by the restraints imposed by the injunctive relief has liberty to apply on 48 hours written or electronic notice to the applicants or the Australian Building and Construction Commission.

4          Costs be reserved.

5          Without limitation as to other means of service, it will be sufficient service of this Order upon each of the respondents if a copy of this Order is:

(a)        posted to each respondent at their known address;

(b)        placed on the notice board(s) usually used for the purpose of communicating with the respondents at the workplace; and

(c)        provided by email or fax to the representatives of the Construction, Forestry, Mining and Energy Union (CFMEU), the Australian Manufacturing Workers Union (AMWU) and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union (CEPU) who have been attending the workplace.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

1                          On 5 February 2010, I made the orders published with these reasons.  Having given short oral reasons, I indicated that I would produce more detailed written reasons.  I now do so. 

INTRODUCTION

2                          On 27 January 2010, in United Group Resources Pty Ltd ABN 17 114 888 201 v Calabro [2010] FCA 22 (United Group No 1), an ex parte interim injunction for 9 days in terms similar to those published with these reasons was ordered.  The applicants have sought an interlocutory injunction extending those orders until trial.  I was not prepared to extend the orders until trial but did grant an extension of the orders for 13 days until 18 February 2010. 

3                          The applicants served the original interim injunction order against the many respondents between 29 and 31 January 2010.  Most of the respondents returned to work following service of that order.

4                          There are, as indicated in United Group No 1, in excess of 1500 respondents.  No affidavits have been filed by any of the respondents.  One of the main concerns in relation to granting an interlocutory injunction until trial was that none of the respondents has been given express notice of the intention to apply for such an interlocutory injunction today.  In normal circumstances, but for the considerations which appear elsewhere in these reasons, on that basis alone I would have been disinclined to grant further relief, let alone an interlocutory injunction until trial.  However, given the history disclosed on the evidence, I was persuaded that limited further orders should be made. 

5                          As reflected in United Group No 1, I am satisfied on the evidence that there is an arguable case that the respondents have engaged in ‘unlawful industrial action’ (as defined there and below) at the Pluto LNG Project at the Burrup Peninsula (the Project) in contravention of the Woodside Pluto LNG Project 2009 No. 2 order of Fair Work Australia dated 23 January 2010 and in breach of the Building and Construction Industry Improvement Act 2005 (Cth) (BCII Act) and the Fair Work Act 2009 (Cth). 

BACKGROUND

6                          The evidence relied upon by the applicants, at least at a prima facie level, does establish that:

·          the applicants are building contractors engaged to carry out the construction of the Project, currently the biggest construction project in the North West of Western Australia;

·          the respondents are building workers employed by the applicants in connection with the construction of the Project;

·          over 1600 respondents were on strike between 22 January 2010 until 30 January 2010 in protest over changes to their accommodation arrangements;

·          their action disrupted the performance of the work on the Project and caused significant direct and immediate financial loss to the applicants and the owner¸ Woodside Burrup Pty Ltd, presently estimated to be around $500,000 per day of the strike.  Other losses are also likely to be suffered in due course arising from the delays to the Project caused by the strike;

·          on 23 January 2010, orders were made by Commissioner Cloghan of Fair Work Australia for employees of the applicants (other than the thirteenth applicant) who were union members to return to work, such orders to remain in force until 28 February 2010; and

·          the order of Commissioner Cloghan was not complied with as the respondents continued their unlawful strike until 30 January 2010;

7                          There is additional but not unequivocal evidence that:

·          on 28 and 29 January 2010, some of the respondents organised picket lines on the access road to the Project site.  The picket lines caused significant disruption, with vehicles banked back approximately 3 – 4 kilometres at certain times during the day;

·          media reports quoting senior union representatives indicate that there was a possibility of further industrial action if the respondents’ demands are not met; and

·          no undertakings have been given by the respondents or their representatives that further unlawful industrial action will not be taken.

JURISDICTION

8                          The Court has jurisdiction under s 39 and s 49 of the BCII Act to grant injunctive relief to prevent the respondents from engaging in ‘unlawful industrial action’.  That action is defined in s 37 of the BCII Act as being building industrial action that is:

(a)        industrially motivated;

(b)        constitutionally connected; and

(c)        not ‘excluded’.

9                          Relevantly, s 39 and s 49 BCII Act respectively provide as follows:

39        Injunction against unlawful industrial action

(1)        If, on application by the ABC Commissioner or any other person, an appropriate court is satisfied that unlawful industrial action is:

(a)        occurring; or

(b)        threatened, impending or probable;

then the court may grant an injunction in such terms as the court considers appropriate.

(2)        If, in the opinion of the court it is desirable to do so, the court may grant an interim injunction pending determination of an application under subsection (1).

(3)        The power of the court to grant an injunction restraining a person (the defendant) from engaging in conduct may be exercised:

(a)        whether or not it appears to the court that the defendant intends to engage again, or to continue to engage, in conduct of that kind; and

(b)        whether or not the defendant has previously engaged in conduct of that kind; and

(c)        whether or not there is an imminent danger of substantial damage to any person if the defendant engages in conduct of that kind.

(4)        In this section

appropriate court means the Federal Court, the Federal Magistrates Court, a Supreme Court of a State or Territory or a District Court, or County Court, of a State.

49        Penalties etc. for contravention of civil penalty provision

(1)        An appropriate court, on application by an eligible person, may make one or more of the following orders in relation to a person (the defendant) who has contravened a civil penalty provision:

(a)        an order imposing a pecuniary penalty on the defendant;

(b)        an order requiring the defendant to pay a specified amount to another person as compensation for damage suffered by the other person as a result of the contravention;

(c)        any other order that the court considers appropriate.

…

(3)        The orders that may be made under paragraph (1)(c) include:

(a)        injunctions (including interim injunctions); and

(b)        any other orders that the court considers necessary to stop the conduct or remedy its effects, including orders for the sequestration of assets.

(4)        If the contravention is a contravention of section 38, then the power of the court to grant an injunction restraining a person (the defendant) from engaging in conduct may be exercised:

(a)        whether or not it appears to the court that the defendant intends to engage again, or to continue to engage, in conduct of that kind; and

(b)        whether or not the defendant has previously engaged in conduct of that kind; and

(c)        whether or not there is an imminent danger of substantial damage to any person if the defendant engages in conduct of that kind.

(5)        A pecuniary penalty is payable to the Commonwealth, or to some other person if the court so directs. It may be recovered as a debt.

(6)        Each of the following is an eligible person for the purposes of this section:

(a)        the ABC Commissioner;

(b)        an ABC Inspector;

(c)        a person affected by the contravention;

(d)        a person prescribed by the regulations for the purposes of this paragraph.

…

10                        Section 38 of the BCII Act provides that a person must not engage in unlawful industrial action.  As previously determined in United Group No 1, I am satisfied for present purposes that there is an arguable case that the industrial action is unlawful.  It is clear from s 49(3) of the BCII Act, that the Court may grant an interlocutory injunction in relation to the respondents who have contravened civil penalty provisions of which s 38 of the BCII Act is one. 

SHOULD RELIEF BE GRANTED WHEN RESPONDENTS HAVE RETURNED TO WORK, CEASING THEIR UNLAWFUL INDUSTRIAL ACTION?

11                        As previously observed in United Group No 1, s 49(3) of the BCII Act confers power to grant an interlocutory injunction without reaching a final decision that a contravention has occurred:  Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 149 IR 299 (at [7], [8]); Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 149 IR 306 (at [52]).  As with s 39(3), s 49(4) of the BCII Act provides, in effect, that if the contravention is a contravention of s 38, then the power of the Court to grant an injunction restraining conduct may be exercised whether or not it appears to the Court that the defendant intends to engage in again or to continue to engage in conduct of the kind prohibited by s 38.  The power to grant an injunction including an interlocutory injunction under s 49 of the BCII Act is additional to the Court’s power under s 39 of the BCII Act.  It does not require the Court to be satisfied that unlawful industrial action is occurring or is threatened, impending or probable.  It is open to the Court under s 49 of the BCII Act to make and order that ‘it considers appropriate’.

12                        The power to grant an interim injunction under s 49(3) of the BCII Act will be exercised having regard to the principles applied by a court of equity, nevertheless noting that the main object of the BCII Act is a relevant consideration:  United Group Infrastructure Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2005) 148 IR 399 (at [23]-[25]).  As previously observed in United Group No 1, the main object of the BCII Act is set out in s 3.  Section 3(1) provides:

3          Main object of Act

(1)        The main object of this Act is to provide an improved workplace relations framework for building work to ensure that building work is carried out fairly, efficiently and productively for the benefit of all building industry participants and for the benefit of the Australian economy as a whole.

13                        Subsection (2) spells out that the main object is to be achieved by the following means amongst others:

·          promoting respect for the rule of law;

·          ensuring respect for the rights of building industry participants;

·          ensuring that building industry participants are accountable for their unlawful conduct.

14                        As observed in United Group No 1, there is also an arguable case at present that in addition to the conduct being unlawful by virtue of s 38 of the BCII Act, the industrial action in which the respondents have engaged to date contravenes s 417(1) and s 421 of the Fair Work Act.  Importantly, it also contravenes a breach of the order of Commissioner Cloghan of Fair Work Australia of 23 January 2010. 

15                        The dialogue directly between the applicants and the respondents on this industrial issue appears to be relatively limited.  There does not appear to have been any undertaking given to the applicants that further unlawful industrial action will not occur.  However, there is evidence that dialogue has been ensuing between the Unions of which the respondents are members (on the one hand) and (on the other), Foster Wheeler WorleyParsons, which supervises the Project.  This has occurred with the helpful assistance of the Hon Deputy President BP McCarthy of Fair Work Australia. 

16                        I have had concerns as to the appropriateness of continuing an injunction in circumstances where the respondents have not been given specific notice of the intention to apply for an interlocutory injunction.  That said, I do note counsel for the applicants’ assurance that the respective unions representing the various workers covered in the schedule of respondents were notified of the intention to bring the application and have not notified the Court or the applicants of any wish to be heard or heard on behalf of the respondents.  

17                        Nevertheless, express notification to the respondents of the intention to apply for an interlocutory injunction is the more preferable course before seeking or granting that relief without notice. 

18                        Although there is a strong arguable case that contraventions have occurred in the past, the strength of the case as to ‘probable’ future contraventions is, nevertheless, not great as the majority of the respondents have returned to work.  While there is evidence that the dispute is not resolved, the evidence that the respondents will resume unlawful industrial action between now and 18 February 2010 is very limited. 

19                        Several previous decisions have addressed the question of whether or not the fact that unlawful conduct has ceased should in itself be sufficient to decline the grant of an injunction sought.  It has been determined that the fact the unlawful industrial action has ceased is not of itself a reason not to grant an injunction.  Examples of such decisions include Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 154 IR 228; John Holland Pty Ltd v Construction, Forestry, Mining and Energy Union (2005) 144 IR 418; United Group Infrastructure; CBI Construction Pty Ltd v Abbott (2008) 177 IR 134; and Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2009] FCA 1092.

20                        Specifically in John Holland, Le Miere J held at [77]:

[77]      The degree of probability of future injury is not an absolute standard. What is to be aimed at is justice between the parties, having regard to all the relevant circumstances: Hooper v Rogers at 50 per Russell LJ followed by the Full Federal Court in Magic Menu Systems Pty Ltd v AFA Facilitation Pty Ltd at 269-270. Provided that there is a real risk of wrongful conduct which would cause injury which is more than trivial, there may be no good reason to refuse quia timet relief: CGM Investments Pty Ltd v Chelliah (No 2) [2003] FCA 305 at [4] per Finkelstein J.

21                        Likewise, also Nicholson J in United Group Infrastructure (at 44), held as follows:

[44]      The balance of convenience then requires consideration. I accept the submission that the strength of the case of the arguability of the serious issues to be tried does weigh to some degree in the balance of convenience. I am influenced by the reference to Kestrel Coal Pty Ltd v Construction, Forestry, Mining and Energy Union [2001] 1 Qd R 634 at [22]-[30] particularly at [22], [28] and [30] which I will not repeat here.

22                        In that decision cited by Nicholson J (Kestrel Coal Pty Ltd v Construction, Forestry, Mining and Energy Union [2001] 1 Qd R 634), Chesterman J said (at [30]):

[30]      In this context it is relevant that the defendants maintained their unlawful obstruction for several weeks and only permitted free access after the interlocutory injunction was ordered.   This is not a case of idle threats.  The defendants have in the past acted unlawfully in violation of the plaintiffs' rights.  This factor makes the case different from those in which an injunction is sought because of conduct which is only apprehended.  The principles applicable to quia timet injunctions are not entirely applicable.  The fact that unlawful conduct has occurred makes the court more disposed towards ordering relief.  See Dean and Chapter of Chester v. Smelting Corporation Limited (1901) 85 LT 67 at 69 and Attorney General v. Beck [1980] 2 NSWLR 77 at 94-95. 

23                        The Full Court has also held that the question of repetition of unlawful conduct is relevant to the exercise of discretion, but relevance is set in the particular context of public interest injunctions as distinct from those related only to private proprietary interests:  ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 at 256-257 per Lockhart J; at 267 per Gummow J and 268 per French J.

BALANCE OF CONVENIENCE

24                        The balance of convenience strongly favours short term relief being extended.  On the basis of the evidence at present, the effect on the applicants and the owners of the Project, Woodside Burrup Pty Ltd (Woodside), of further industrial action is most significant with an estimated direct cost alone exceeding $500,000 a day.

25                        Additionally, there are potential consequences of industrial action such as damage to the reputation of the applicants and liquidated damages for delay.  Woodside, in turn, would, if the delay continued, face potential losses arising from loss of revenue due to production delay.  These considerations, extending as they do, to third parties, are nevertheless relevant:  Patrick Stevedores Operations Pty Ltd v Maritime Union of Australia (1998) 82 IR 87.

26                        The prospect of the respondents being able to meet an award in damages for such loss is unrealistic. 

27                        Moreover, the proper formulation of the test concerning the adequacy of damages is not whether they are an adequate remedy but whether it is ‘just in all the circumstances’ that the applicants should be ‘confined to a remedy in damages’:  CBI Construction Pty Ltd v Abbott per Gilmour J (at [70]). 

28                        Underlying this dispute is said to be the issue concerning ‘motelling’ discussed in United Group No 1.  There is evidence that some or all respondents who fly in, fly out to their work site, oppose a circumstance in which they are required to return to different temporary accommodation from that occupied on the previous work interval.  While it might be thought that some practical measure could be adopted to address concerns arising from this complaint, the prospect of ‘motelling’ for a short term appears to be the only possible adverse consequence of restraining the respondents from engaging in further unlawful industrial action.  On the other hand, they will at least, by returning to and remaining at work, be paid in accordance with Workplace Agreements. 

29                        For those reasons, as the balance of convenience strongly favours the orders being extended for a finite period, with liberty to apply being granted, I made orders for a brief period of time.  These will preserve the status quo. 

SERVICE

30                        For service under 0 7 of the Federal Courts Rules, the respondents’ proper addresses are their home addresses rather than their addresses at the work site.  However they travel from their home addresses to the work site which they occupy while employed at the site.  The injunction primarily concerns their conduct at the work site.  Wide publicity has surrounded this dispute including the making or these and previous orders.  The Unions of which the respondents are members are and will be well aware of these and the previous orders in United Group No 1.  In accordance with the power in O 7 r 9 of the Federal Court Rules I have made provision for substituted service of the orders that are made below, as the circumstances of the case require prompt service and personal service is impractical. 

31                        The orders I make are as follows:

1          Upon the applicants having given the usual undertaking as to damages, until 5.00 pm on 18 February 2010 or further order, pursuant to s 39 and/or s 49(1)(c) of the Building and Construction Industry Improvement Act 2005 (Cth) each respondent is restrained from:

(a)        engaging in or being a party to or in any way associated with or otherwise involved in any of the following actions in relation to building work on the Pluto LNG Project at Burrup Peninsula (Project):

(i)         failing or refusing to attend work on the Project or failing or refusing to accept or perform work on the Project at all;

(ii)        performing work on the Project otherwise than in accordance with the terms of his employment contract;

(iii)       performing work on the Project in a manner different from that in which it is customarily performed, or adopting any practice in relation to work on the project, the result of which is a restriction or limitation on, or a delay in, the performance of that work;

except where such actions:

(i)         are authorised or agreed to by the respondent’s employer; or

(ii)        are based upon the respondent’s reasonable concern about an imminent risk to the respondent’s health or safety and the respondent has not unreasonably failed to comply with the directions of the respondent’s employer to perform other available work, whether at the same or another workplace, that was safe and appropriate for the respondent to perform;

(b)        interfering with or in any way disrupting the performance of work on the Project by any of the following means:

(i)         imposing, maintaining or aiding, abetting, encouraging, directing, procuring, inducing, advising or otherwise being involved in any bans, limitations, restrictions or delays on the performance of work or the acceptance of work by any of the applicants’ other employees to be performed under their terms of employment or in a manner which work is customarily performed with the applicants; and

(ii)        imposing, maintaining or aiding, abetting, encouraging, directing, procuring, inducing, advising or otherwise being involved in the taking of days off by any of the applicants’ other employees otherwise than in accordance with rosters specified by the industrial instruments and employment contracts regulating their employment with the applicants.

2          Any further application for an interlocutory injunction be listed for hearing at 10.00 am on Thursday 18 February 2010 together with a directions hearing.

3          Any person affected by the restraints imposed by the injunctive relief has liberty to apply on 48 hours written or electronic notice to the applicants or the Australian Building and Construction Commission.

4          Costs be reserved.

5          Without limitation as to other means of service, it will be sufficient service of this Order upon each of the respondents if a copy of this Order is:

(a)        posted to each respondent at their known address;

(b)        placed on the notice board(s) usually used for the purpose of communicating with the respondents at the workplace; and

(c)        provided by email or fax to the representatives of the Construction, Forestry, Mining and Energy Union (CFMEU), the Australian Manufacturing Workers Union (AMWU) and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union (CEPU) who have been attending the workplace.

Associate: 

Dated:         12 February 2010

RESPONDENTS’ SCHEDULE A