FEDERAL COURT OF AUSTRALIA

Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2014] FCA 652

THE COURT ORDERS THAT:

1.    Leave be given to the first respondent to file and serve by 10 July 2014 such amended defence as it may be advised.

2.    The applicant do file and serve by 25 July 2014 if the first respondent files and serves an amended defence in accordance with Order 1 hereof and otherwise by 29 August 2014 a list of the documents in the Director’s custody, possession or power in the following categories:

(1)    Any transcript of interview of either Emanuel Milatos or Michael Milatos conducted by the Director’s representative, recording what they or either of them said about any of the events referred to in the Statement of Claim.

(2)    Any other document recording any communication between any Fair Work Building Industry Inspectorate representative and either Emanuel Milatos or Michael Milatos recording what they or either of them said about any of the events referred to in the Statement of Claim.

(3)    Any notebook, diary, log, workbook record, note or other document made by either Emanuel Milatos or Michael Milatos, or by any employee, servant or agent of Reday, on the basis of information provided by either Emanuel Milatos or Michael Milatos, recording any information about any of the events referred to in the Statement of Claim and which is materially adverse to the allegations in the Statement of Claim or which may materially assist the respondents in the conduct of their case (other than the documents already provided) to the respondents or discovered by the Orders (1) to (3) of this paragraph.

(4)    Any notebook, diary log, workbook record, note or other document which records information provided by any employee of Reday who saw any of the events referred to in the Statement of Claim, and which is materially adverse to the allegations in the Statement of Claim or which may materially assist the respondents in the conduct of their case (other than documents already provided) to the respondents or discovered by the Orders (1) to (3) of this paragraph.

3.    The parties shall file and serve any affidavit containing the evidence in chief of any witness whom that party proposes to call to give evidence at trial, save that in respect of the occasions referred to in paragraphs 17, 18, 19, 20 and 26 June 2013 referred to in the Statement of Claim, that party may refer to each such occasion, those present and the substance of what occurred and indicate that he or she will give oral evidence concerning it, save that Mr Pearson and Mr Olsen may to the extent necessary to exercise their privilege not to disclose information which may expose them to a pecuniary penalty not refer other than to the occasion itself:

(a)    the applicant by 25 July 2014;

(b)    the respondents by 15 August 2014.

4.    Each party shall file and serve an index of the documents that party proposes to rely on at the trial in the following sequence:

(a)    the applicant by 25 July 2014;

(b)    the respondents by 15 August 2014.

5.    On or before 10 September 2014 each party shall file and serve the book of documents which that party proposes to adduce in evidence.

6.    The proceeding be listed for trial in Darwin at 10:15 am on 17 September with an estimate of two days.

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

REASONS FOR JUDGMENT

1    The applicant (the Director) seeks declaratory orders and monetary penalties against the respondents for contraventions of the Fair Work Act 2009 (FW Act) in respect of their alleged conduct at a construction site in Darwin where Reday Pty Ltd (Reday) was building and developing an apartment block (the project).

2    On 15 June 2013, it is alleged, the first respondent (CFMEU) sent to Reday 19 right of entry notices for 19 CFMEU employees, including the second respondent (Mr Pearson) seeking to enter the site for the purposes of s 484 of the FW Act.

3    The significant conduct is said to have occurred on 17, 18, 19, 20 and 26 June 2013. That conduct is said to have led to Mr Pearson and the third respondent, Mr Olsen contravening s 500 of the FW Act.

4    At present the defence of the respondents, apart from some obviously appropriate admissions, simply denies the facts alleged. Mr Pearson and Mr Olsen say they cannot plead their case further because, to do so, would infringe their privilege against being exposed to pecuniary penalties: see Australian Competition and Consumer Commission v FFE Building Services Limited (2003) 130 FCR 37 at [13]; Australian Securities and Investments Commission v Mining Projects Group Ltd (2007) 164 FCR 32 at [13].

5    The CFMEU has also pleaded in that way, as it says it cannot plead further because Mr Pearson and Mr Olsen have claimed the privilege against exposure to penalties.

Is the CFMEU Defence adequate?

6    In my view, the CFMEU Defence is not adequate. It is not entitled to use the privilege of Mr Pearson and Mr Olsen so it does not otherwise have to comply with the pleading rules: Federal Court Rules 2011 (Cth), rr 16.02(1)(d), 16.03, 16.04, 16.07 and 16.08. See also Rule 16.41 and Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at [31].

7    It is not for the Court to direct how its case should have been pleaded. The “do not know and cannot admit” plea is, of course, available: see r 16.07(3), but the form of the CFMEU pleading at present seems to exclude that option, especially as the three respondents are represented by the same solicitors. I note also that there are alleged to be other persons than Mr Pearson and Mr Olsen who were variously present when the asserted conduct was engaged in, and as persons acting for the CFMEU they may have provided the CFMEU or the solicitors with information about the allegations of the Director. I note also that the pleading by the CFMEU is not able to be used as an admission against either Mr Pearson or Mr Olsen. I note further that it is not claimed by the CFMEU that it has any privilege against a proper pleading on its behalf because it may be exposed to a monetary penalty.

8    I therefore propose to allow the CFMEU to file an amended defence in such terms as it may be advised, and I fix 10 July 2014 as the date by which it must do so. I indicate that it is not necessary for the CFMEU to amend the existing defence as well, as it will be read subject to this ruling.

Should an order for discovery against the Director be made?

9    The Director has provided to the respondents the full witness statements of the two persons on behalf of Reday who had dealings with Mr Pearson and Mr Olsen and others on the dates referred to.

10    The respondents nevertheless seek further discovery. An extensive schedule of documents to be discovered was sent with a letter from the respondents’ solicitors of 23 May 2014. That schedule is now not fully pursued. The categories of document now sought are:

(1)    Any document recording any communication, or what transpired at any meeting, between any FWBII representative and Reday, its officers, staff members, employees, servants or agents in relation to any SOC matter.

(2)    Any transcript of interview conducted by an FWBII representative relating to any SOC matter.

(3)    Any notebook, diary, log, work book, record, note or other document containing information entered or made by any FWBII representative or any employee, servant or agent of Reday or Cento about conduct at the Project between 15 June 2013 and 26 June (inclusive), including but not limited to the diary notes of Emanuel Milatos.

(4)    Any document recording what was said or done at each of the meetings alleged to have been attended by the respondents and/or representatives of the CFMEU as pleaded in the Statement of Claim.

Those documents are said to be available, or likely to be available, in an Investigation File of the Director.

11    In my view, certain of those documents are discoverable. To an extent they will be provided by the order I propose to make for the way the hearing should progress. Beyond that, as counsel for the respondents acknowledged, the purpose of seeing that material is in essence to test the veracity of the two proposed witnesses to be called by the Director (as presently advised). As that is the purpose of the discovery sought, I do not accede to the request that discovery be given before the completion of pleadings.

12    Moreover, if there is no amended defence by the CFMEU, it may be that the Director will apply to strike out parts of the present defence in the light of this ruling.

13    The material of which I propose to order discovery is more limited than the current requests. Internal investigative memoranda or summaries of material provided by others cannot be of direct relevance. I consider the discovery should be limited to documents which represent records of Reday held by the Director which directly record or report on the alleged events and being the primary recollection of the two proposed witnesses, or records of interview by officers of the Director of those two persons, confined to information provided by those two persons. That is because the respondents’ counsel identified the assessment of their credit as the potential issue for which discovery is sought. If there are other persons who witnessed those events and who made a record, or gave a statement, concerning them, and it is material, Order 2(4) will encompass such documents.

14    Accordingly, there will be an order that the Director within 14 days of service of any amended defence of the CFMEU provide such discovery. If there is no amended defence, this order will not be enlivened until after the filing and service of witness statements on behalf of the respondents in accordance with the orders as to the mode of trial set out below, that is by 29 August 2014.

15    The order for further discovery will be in respect of the following documents:

(1)    Any transcript of interview of either Emanuel Milatos or Michael Milatos conducted by the Director’s representative, recording what they or either of them said about any of the events referred to in the Statement of Claim (SOC).

(2)    Any other document recording any communication between any FWBII representative and either Emanuel Milatos or Michael Milatos recording what they or either of them said about any of the events referred to in the SOC.

(3)    Any notebook, diary, log, workbook record, note or other document made by either Emanuel Milatos or Michael Milatos, or by any employee, servant or agent of Reday, on the basis of information provided by either Emanuel Milatos or Michael Milatos, recording any information about any of the events referred to in the SOC and which is materially adverse to the allegations in the SOC or which may materially assist the respondents in the conduct of their case (other than documents already provided) to the respondents or discovered by the Orders (1) to (3) of this paragraph.

(4)    Any notebook, diary log, workbook record, note or other document which records information provided by any employee of Reday who saw any of the events referred to in the SOC, and which is materially adverse to the allegations in the SOC or which may materially assist the respondents in the conduct of their case (other than documents already provided) to the respondents or discovered by the Orders (1) to (3) of this paragraph.

The mode of trial.

16    I do not propose to require the Director to withdraw or recast the witness statements already provided to the respondents.

17    I agree with counsel for the respondents that oral evidence of any witness about the contested events in the case is preferable. I am told the events as alleged will be disputed. I propose, nevertheless, to require witness statements or affidavits to be filed, which will provide any background and apparently uncontentious material but which will otherwise simply identify the occasion about which oral evidence will be given. It is accepted by Mr Pearson and Mr Olsen that they were present on the occasions they are said in the SOC to have been present. If there are other persons who the respondents propose to call about those events, as they are not themselves said to have contravened the relevant provisions of the FW Act, their statements should get to the point of identifying the occasion, the time, the place and those present, and (to the extent there is a dispute) the fact that there is a dispute about the facts as asserted concerning that occasion and briefly describing in broad terms the substance of what then occurred.

18    I will also expect both the witnesses called by the Director to give oral evidence about those events, notwithstanding their full witness statements. They do not need to revise them. If the Director proposes to call further witnesses as to those events, they should adopt the regime referred to in the preceding paragraph.

19    I accordingly direct that the parties shall file and serve any affidavit containing the evidence in chief of any witness whom that party proposes to call to give evidence at trial, save that in respect of the occasions which occurred on 17, 18, 19, 20 and 26 June 2013 referred to in the SOC, the deponent may refer to the occasion or occasions, identifying those present and the substance of what occurred and indicate that he or she will give oral evidence concerning it, save that Mr Pearson and Mr Olsen may to the extent necessary to exercise their privilege not to disclose information which may expose them to a pecuniary penalty not refer other than to the occasion itself in the following sequence and by the specified date:

(a)    the Director by 25 July 2014;

(b)    the respondents by 15 August 2014.

20    In addition, I propose to require each party to serve an index of the documents that party proposes to rely on at the trial in the following sequence and by the specified date:

(a)    The Director by 25 July 2014;

(b)    The respondents by 15 August 2014.

21    On or before 10 September 2014 each party shall file and serve the book of documents which that party proposes to adduce in evidence.

22    The proceeding be listed for trial in Darwin on commencing at 10:15 am on 17 September 2014, with an estimate of two days.

23    It remains to indicate that the filing of an affidavit of a proposed witness does not commit the party filing that affidavit to call that witness.

Associate:

Dated:    19 June 2014