FEDERAL COURT OF AUSTRALIA

Zhao v TTS & Associates Pty Ltd [2020] FCA 922

ORDERS

THE COURT ORDERS THAT:

1.    The applicant’s application for leave to appeal filed 6 April 2020 is dismissed.

2.    The respondent file and serve written submissions in relation to costs (if sought) by 4pm, 10 July 2020.

3.    The applicant file and serve any reply to the respondent’s submissions in relation to costs (if sought) by 4pm, 17 July 2020.

4.    Orders as to costs be made in chambers upon consideration of those written submissions, subject to either party requesting a further hearing.

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

REASONS FOR JUDGMENT

SNADEN J:

1    The applicant is a former employee of the respondent’s. She was dismissed from her employment as a senior accountant in July 2018. By a proceeding that she commenced in the Fair Work Commission (hereafter, the “FWC”) and, later, the Federal Circuit Court of Australia (hereafter, the “FCCA”), she sought to challenge that dismissal. She alleged that it was effected in contravention of various statutory injunctions contained within pt. 3-1 of the Fair Work Act 2009 (Cth) (hereafter, the “FW Act”). She claimed that she had been dismissed because she was pregnant, and because she had possessed or exercised a workplace right or rights (within the meaning given to that term by s 341 of the FW Act).

2    Before an employee (or former employee) can prosecute a suit in the FCCA arising from a dismissal in breach of pt 3-1 of the FW Act, they must first apply to the FWC to have their dispute “deal[t] with”: FW Act, s 370. The FWC has jurisdiction to “deal with” such disputes by means of private conciliation and, in limited circumstances, arbitration: FW Act, ss 368, 369. If, despite all reasonable attempts, conciliation fails to resolve the dispute, the FWC must issue a certificate to that effect: FW Act, s 368(3). Once such a certificate is issued, the former employee may commence a proceeding in the FCCA in respect of the dispute to which it pertained. Such a proceeding must be commenced within 14 days of the certificate’s being issued: FW Act, s 370(a).

3    That process occurred in the present matter without controversy. On 21 November 2018, the applicant filed an application in the FCCA alleging that the respondent had terminated her employment in contravention of pt 3-1 of the FW Act (or of various of the provisions contained therein). The matter was listed for hearing—most likely for some kind of interlocutory or case-management hearing—on 25 February 2019. Notice of that listing was provided to the applicant but, regrettably, she overlooked it. On that day, neither the applicant nor the respondent attended at the court and the proceeding was dismissed for want of appearance.

4    Nearly a year later, the applicant contacted the FCCA to enquire about the progress of her matter. Upon being told that it had been dismissed on 25 February 2019, she made an application to set that dismissal aside. That application (hereafter, the “Interlocutory Application”) was the subject of a hearing conducted on 4 March 2020. On 23 March 2020, the FCCA dismissed that application and published reasons for doing so: Zhao v TSS & Associates Pty Ltd [2020] FCCA 595 (Judge Burchardt). It is from that judgment (hereafter, the “Primary Judgment”) that the applicant now seeks leave to appeal.

5    For the reasons that follow, leave to appeal is refused.

The primary judgment

6    The Interlocutory Application was not put before me but its nature was not obviously controversial. By it, the applicant sought an order to set aside the orders that were made on 25 February 2019 dismissing her substantive proceeding. It is apparent that that Interlocutory Application, whatever might have been its form, proceeded as an application under r 16.05 of the Federal Circuit Court Rules 2001 (Cth) (hereafter, the “FCCA Rules”).

7    Rule 16.05 of the FCCA Rules relevantly provides as follows:

16.05 Setting aside or varying judgments or orders

….

(2)    The Court or a Registrar may vary or set aside a judgment or order after it has been entered if:

(a)    it was made in the absence of a party; or

…

(c)    it is interlocutory; or

…

8    In dismissing the Interlocutory Application, the FCCA took account of three broad considerations: the applicant’s explanation for her non-attendance at the hearing of 25 February 2019, the prospect that her substantive application might succeed if reinstated and the prejudice that would befall the respondent in that event.

9    As to the applicant’s explanation for her non-attendance, the court recorded the following observations (Primary Judgment, [16]-[17]):

There can be no doubt in the face of the applicant’s candid admission that her failure to attend the proceedings in February 2019 was because she negligently failed to pay proper attention to the sealed documents that the Court sent to her. She is a highly intelligent, professional person, and she ought to have paid better regard to the materials with which she was provided. Furthermore, and this is only because she has not put the matter herself on affidavit, it is not clear whether the advice that she says she received from the community legal centre to the effect that there would be nothing happening for a year was before or after the receipt of those sealed documents.

Notwithstanding these reservations, however, I note that the applicant moved extremely promptly when she finally did discover that her application had been dismissed. Although it took her approximately a week to serve the respondent, the fact is that she did so forthwith when it became apparent to her that she was required to do this. Given the applicant’s strongly expressed desire to continue with the matter, I think that her explanation is at least sufficiently plausible for this not to count heavily against her. However, it does need to be borne in mind that the failure on her part to attend arose solely through her own inadvertence.

10    The FCCA next considered the merits inherent in the applicant’s substantive case. Of present significance is its observation (Primary Judgment, [19]-[20]) that:

Although it is clear that the respondent informed the applicant that her employment was terminated for poor performance (“the firm said I was sacked due to performance”), it would seem to me that on a fair and necessarily impressionistic reading of the applicant’s case, if the facts she asserts were made out, it might well give rise to a cause of action properly pursuable in the Court.

It is self-evidently impossible to make any more detailed assessment of the application’s merits at this time.

11    The FCCA then addressed the issue of the prejudice that would befall the respondent in the event that the matter were reinstated. It is convenient to set out in full the court’s observations on that score (Primary Judgment, [21]-[26]):

The area of difficulty that this application most profoundly raises, however, is the last of the three primary criteria, which it should be noted are not an all-inclusive or exhaustive list of considerations. The events in question appear to go back to June 2018. The narrative in the Form 2 goes back as far as late 2017. That narrative would be relevant to the trial because it would be the applicant’s case that her performance was excellent and that the dismissal was therefore not performance-related. The events of late 2017 are now over two years ago.

By the time the matter gets on to trial, it would be reasonable to suppose that there will have been a three-year delay, given the Court’s current listing pressures. I note that even looking at the applicant’s Form 2 narrative, it would seem highly likely that the respondent would be required to call a number of witnesses. This would mean that the case might well involve a not insignificant number of days, which would mean that the time it takes to get on for trial would perhaps be delayed yet further.

More to the point, I have been informed by counsel on her instructions that at least one witness that the respondent would wish to call is no longer employed. While, of course, it is possible that such a person might be subpoenaed or might even, indeed, volunteer to give evidence, as a matter of practical politics, once a person leaves their employment, it is my experience that they become markedly disinclined to further involve themselves in the affairs of their former employer. While I obviously cannot evaluate with certainty whether or not the departed employee would or would not give evidence, it is immediately apparent that the position of the respondent is prejudiced.

Furthermore, the regrettable delay of over a year before this application effectively gets filed at all is of itself prejudicial to the respondent. There are time limits for applications of this character. There is a 14-day limit from the filing of the certificate. Of their nature, applications of this sort must be taken to be intended to be addressed at least as urgently as is practicable. A superimposed delay of one year through the negligence of the applicant is, in my view, a decisive consideration.

I accept that the applicant is bitterly disappointed, to say the least, about what she perceives to have occurred to her. I note that she is in employment and suspect that the motivation that impels her is more to do with her sense of injustice than any singularly pecuniary limited one.

Nonetheless, litigants are responsible for their own actions.

12    Weighing those considerations together, the FCCA concluded (Primary Judgment, [27]) that it was “inappropriate to reinstate the proceeding” and dismissed the Interlocutory Application.

The present application

13    The present application for leave to appeal from the Primary Judgment was filed on 6 April 2020. It is supported by three affidavits, all affirmed by the applicant herself. The respondent agitated several objections to various parts of those affidavits but it is unnecessary to explore any of them presently.

14    Contrary to the requirements of r 35.12(2)(d) of the Federal Court Rules 2011 (Cth), the applicant has not supplied a draft of the notice of appeal that she proposes to file in the event that her application succeeds. The applicant was self-represented (with the assistance of a McKenzie friend, Mr Morris), both before this court and before the FCCA. It is appropriate to (and I do) forgive a degree of unfamiliarity on her part with the requirements of the rules. It is apparent—from her application for leave to appeal and from the submissions that she advanced in support of it—that the appellant considers that the FCCA’s decision to dismiss her Interlocutory Application was the product of error, specifically in that:

(1)    the FCCA misunderstood (in a manner apt to artificially or wrongly inflate) the true nature of the prejudice that reinstatement of her substantive proceeding would visit upon the respondent;

(2)    the FCCA misunderstood (again, in a manner apt to artificially or wrongly inflate) the applicant’s culpability for missing the 25 February 2019 hearing;

(3)    the FCCA took account of an irrelevant consideration en route to making its decision (specifically, that the applicant has since secured alternative employment); and

(4)    the FCCA denied the applicant procedural fairness insofar as it required that she address at the hearing (as opposed to some later point in time) what the respondent advanced on the question of prejudice.

15    The considerations relevant to the exercise of the Court’s discretion to grant or not grant leave to appeal are well established. They include whether or not an appeal would have any reasonable prospects of success and whether the applicant would suffer substantial injustice if leave were refused: Decor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397, 398-399 (Sheppard, Burchett and Heerey JJ); Iannuzzi v Federal Commissioner of Taxation (2019) 268 FCR 349, 351 [3] (Kenny, Jagot and Banks-Smith JJ); and Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (the costs of the Cup of Tea Case) [2019] FCAFC 36, [2] (Flick, Reeves and O’Callaghan JJ).

16    For reasons that might shortly become apparent, I will address those considerations in reverse order.

Substantial injustice

17    In the event that leave to appeal from the Primary Judgment is not granted, the applicant will effectively be prevented from ventilating her substantive causes of action against the respondent. Assuming, momentarily, that the Primary Judgment is attended by doubt sufficient to warrant its reconsideration by this court, there is little doubt that the applicant would suffer substantial injustice in the event that leave to appeal were not granted. The respondent properly conceded as much.

Is the primary judgment attended by sufficient doubt?

18    The Primary Judgment involved an exercise of judicial discretion. If the applicant is to overturn it on appeal, she will need to demonstrate that that discretion miscarried in any one or more of the ways to which the High Court of Australia referred in House v R (1936) 55 CLR 499. There, it was observed (at 504-505; Dixon, Evatt and McTiernan JJ):

The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so.

19    Helpfully, in an affidavit that she affirmed on 6 May 2020, the applicant identified the ways in which she felt that the Primary Judgment involved error of the kinds to which their Honours referred. It is convenient to address in turn each of the species of discretionary error so alleged.

Wrong principle

20    The applicant accepts that the Primary Judgment does not rest upon the application of any wrong principle.

Irrelevant or extraneous matters

21    The applicant submits that the FCCA wrongly took account of the fact that, since her employment with the respondent ended, she has secured alternative employment elsewhere. That fact is recorded in the Primary Judgment (at [25]; above, [11]). It was not, she submits, a circumstance that could properly inform the discretion that was reposed in the FCCA; and, by taking account of it, the FCCA should be understood to have “allow[ed] extraneous or irrelevant matters to guide or affect [it]”.

22    Respectfully, the applicant makes more of what is recorded at [25] of the Primary Judgment than she should. She may well be correct to submit that “the motivation that impels her” (as the FCCA there recorded it) was not a circumstance by which the FCCA’s discretion was properly to have been informed; but nor was it something that factored in any apparent way in what the FCCA decided. Read fairly, the FCCA’s observations at [25] of the Primary Judgment simply recorded the court’s view that the applicant’s grievance was genuinely held. There can be (and is) no suggestion that it might have been any less so because of her securing of alternative employment. Respectfully, the FCCA’s speculation about the applicant’s motivation in wishing to prosecute her action was, at worst, unnecessary; but it cannot fairly be impugned as an irrelevance upon which its decision materially turned. It was, to descend to the vernacular, a throw-away line.

23    That being so, I do not consider that there is any realistic prospect that the applicant will be able to establish that the FCCA erred, in a House v R sense, by making the observation upon which she fixes.

Mistakes of fact

24    The applicant submits that the FCCA mistook the facts in material ways and, having done so, erred in such a manner that its discretion miscarried. I address in turn each of the factual mistakes that the applicant alleges. Some of the errors so advanced were also said to amount to a failure on the part of the FCCA to take account of relevant or material considerations—for reasons that will become apparent, it is not necessary to address those contentions more than once.

The prejudice to the respondent

25    The applicant submits that the FCCA misunderstood the nature and/or degree of the prejudice that the reinstatement of her substantive proceeding—or, perhaps more accurately, the circumstances that have led to her application to reinstate it—would visit upon the respondent.

26    The FCCA, in its reasons for judgment, recorded the submission that the respondent made as to the potential availability of witnesses. It appears to have accepted (in the orthodox way) what counsel submitted: namely, that at least one of the witnesses that the respondent would wish to call to give evidence at the trial (were the matter to be reinstated) was no longer in its employ. The applicant submits that it was wrong to accept that indication. Having recently checked the respondent’s website, she suggests that there is nobody whom the respondent might need to call to give evidence in the substantive proceeding that isn’t still an employee.

27    With respect, there is no substance to the applicant’s complaint. The FCCA’s reasoning on the issue of prejudice is plain: it concluded that the effluxion of more than a year from the point that the applicant’s substantive matter was scheduled for hearing to the point that her Interlocutory Application was determined was a circumstance that would prejudice the respondent’s defence of her claims. It was plainly open to the court to reason in that way. It did not reason that the Interlocutory Application should be dismissed simply because there was a witness whom the respondent intends to call whose employment is no longer extant.

28    Even had it done so, the FCCA was entitled to treat the indication that it received from counsel precisely as it did. There was no basis upon which the FCCA should have doubted what it was told. The applicant did not call it into question, nor suggest that she should have an opportunity to interrogate for herself, what was said. It would be most unusual for any such opportunity to be granted. Even assuming, as the applicant now submits, that the indication given to the FCCA was wrong—a possibility that I entertain only for the purposes of analysis—it is difficult to see how the FCCA might be understood to have erred. It is not an error to proceed upon an unchallenged indication from counsel about an issue that would not typically be the subject of evidence.

29    The applicant submits that the FCCA ought to have approached the issue of prejudice in a more inquisitive way; that is, that it ought to have probed the indication that was given to it about witness availability. Respectfully, I do not accept that it laboured under any such obligation. In the absence of its having some reason to doubt what it was told, the FCCA’s approach to the issue strikes me, with respect, as entirely orthodox and appropriate.

30    The applicant also raised, in relation to the issue of prejudice, the fact that, prior to her dismissal, she was not warned about any poor performance (which was the reason that the respondent gave for her dismissal). She submitted that there was little or nothing inherent in the effluxion of time or in the potential unavailability of witnesses that might prevent the respondent from leading evidence about why no such warning was given. Again with respect, that submission is without substance. If the respondent were to maintain the narrative that it dismissed the applicant because of her performance, it would very likely seek—and, in any event, would almost certainly be entitled—to lead evidence about that performance. Such evidence is common (although not strictly required) in proceedings under pt 3-1 of the FW Act. The existence or otherwise of any pre-existing warning about the applicant’s performance would not affect anything in that sense.

31    The applicant has little, if any, prospect of convincing the court that the FCCA’s analysis of the issue of prejudice was affected by House v R error. Likewise, she has little, if any, prospect of establishing that the FCCA’s discretion to dismiss her Interlocutory Application miscarried on account of that analysis.

The applicant’s culpability for missing the 25 February 2019 hearing

32    The applicant submitted that the FCCA erred by concluding that she was at fault for her failure to attend the 25 February 2019 hearing. Although she accepts a degree of culpability in that regard, she submitted that the FCCA had not properly understood the circumstances surrounding her failure to appear on that date.

33    Before me, the applicant maintained that she should not be held at fault, or perhaps substantially at fault, for having missed the 25 February 2019 hearing. That, she said, is so because:

(1)    she is (and was) a self-represented litigant, unfamiliar with the niceties of court processes;

(2)    she has not been able to afford her own lawyer;

(3)    she had received advice (it appears from more than one source) to the effect that her matter would not be heard for at least 12 months (and, hence, she did not expect that it would be listed for a hearing when it was);

(4)    she did not understand the difference between a “sealed” document and an “unsealed” document (the significance of which being that the 25 February 2019 hearing date was recorded on the sealed copy of her originating application in the FCCA, which was given to her after she filed it); and

(5)    she had not, contrary to reasonable expectation, received any separate notice from the court that a hearing had been scheduled for that date.

34    It bears noting that the FCCA accepted that the applicant had an explanation for her non-attendance at the 25 February 2019 hearing that was “…at least sufficiently plausible for this not to count heavily against her”. It is plain from the Primary Judgment that the FCCA did not consider the reason or reasons for which the applicant failed to attend the 25 February 2019 hearing weighed heavily in favour of or against the reinstatement of her substantive proceeding.

35    Respectfully, none of the submissions that the applicant advanced before me is such as might warrant a finding that the FCCA’s discretion miscarried. It was open to the FCCA to form and act upon the view that it formed (namely, that the applicant was negligent, or otherwise at fault, inasmuch as she failed to appear at the 25 February 2019 hearing, but that that didn’t much bear upon the determination of the Interlocutory Application). What the applicant seeks to do is convince this court that a different conclusion as to the level of her culpability ought to have been preferred. It is not—and, were leave to appeal granted, would not be—for this court to form such a view. At issue is whether it was open to the FCCA, upon a proper appreciation of the facts, to form the view that it did. It was.

36    It follows that I do not consider that the applicant has much, if any, prospect of establishing that the FCCA’s discretion to dismiss her Interlocutory Application miscarried because of the conclusion that it drew about the extent to which her non-attendance at the 25 February 2019 hearing was a function of her own negligence.

Denial of procedural fairness

37    The applicant submitted that the FCCA’s discretion to dismiss her Interlocutory Application miscarried because its exercise was premised upon a denial of procedural fairness. That denial, she claimed, was a function of the fact that she was not afforded, or invited to request, an opportunity to test the indication that the respondent, through its counsel, gave about potential witness availability. The significance of that indication has already been addressed.

38    That the applicant was self-represented (accompanied by Mr Morris) at the hearing of the Interlocutory Application is, of course, accepted. But that does not confer upon the FCCA some obligation to afford her what she now maintains that she was denied. There was nothing unusual about the exchange that the FCCA had with counsel for the respondent. The FCCA was not obliged to assume that there was, nor to provide the applicant (in the absence of request, no less) an adjournment or any other procedural indulgence on account of it.

39    It follows that I do not consider that the applicant has any realistic prospect of convincing this court that the FCCA denied her procedural fairness in the manner that she alleges.

Conclusion as to the merits of the appeal

40    The appeal that the applicant hopes to prosecute lacks merit. There is little to no prospect that she will be able to establish that the FCCA’s discretion to dismiss her Interlocutory Application miscarried.

Disposition

41    Taking account of the considerations relevant to the issue (namely the merits of the proposed appeal and the prejudice that will befall the applicant in the event that leave is denied), I am not persuaded that leave to appeal should be granted. The application will, for that reason, be dismissed.

42    Section 570(1) of the FW Act likely prohibits the awarding of costs in the present application. Nonetheless, the respondent indicated a wish to be heard on that issue. In addition to dismissing the present application, I will make orders giving the respondent until 10 July 2020 to file, should it wish to, written submissions on the question of costs; and for the applicant to file submissions in reply by 17 July 2020. Subject to either party requesting otherwise, I will make further orders with respect to costs on the papers.

Associate:

Dated:    3 July 2020