Federal Court of Australia

Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Yatala Labour Prison Case) [2022] FCA 492

ORDERS

THE COURT ORDERS THAT:

1.    The oral application by the applicant for leave to file a further amended statement of claim in the form provided to the respondents at the time of argument is refused.

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

REASONS FOR JUDGMENT

O’SULLIVAN J

Introduction

1    This matter concerns an interlocutory application (“strike out application”) filed 9 February 2022 by the 2nd to 5th respondents (“respondents”) seeking to strike out a number of paragraphs of the statement of claim filed at the same time as the originating application in this matter.

2    It is necessary, at this stage, to say something about the status of the pleadings, in particular the statement of claim. The applicant filed an originating application and statement of claim on 10 January 2022. The respondents filed their strike out application and on 23 February 2022 the applicant filed an amended statement of claim. By affidavit sworn 7 March 2022, and filed 8 March 2022, the solicitor for the respondents deposed that as a result of the applicant filing its amended statement of claim some, but not all of the respondents’ concerns, had been addressed. Nonetheless, there remained a number of paragraphs in the amended statement of claim in relation to which the respondents pressed their strikeout application.

3    The strikeout application was listed for argument on 11 April 2022.

4    On 8 April 2022, the applicant provided a draft further amended statement of claim to the respondents which, it contended, addressed further the respondents’ complaints.

5    At the latest, the pleadings closed on 24 February 2022: rr 16.12, 16.33 of the Federal Court Rules 2011 (Cth) (“FCR”). Pursuant to FCR 16.51(1) the applicant had the right to file the amended statement of claim without leave. That being the case, the applicant required leave to file a further amended statement of claim.

6    When the matter was called on for argument on 11 April 2022, I was informed that with the exception of a limited number of paragraphs of the draft further amended statement of claim, the respondents had no complaint about the pleading. The applicant made an oral application for leave to file the draft further amended statement of claim as a further amended statement of claim. Subject to the identified paragraphs, the respondents, as well as the first respondent (“Union”), consented to the filing of the document. However, given the respondents were still pressing their application in relation to those limited number of paragraphs, I declined to grant leave to the applicant to file the further amended statement of claim without first hearing argument on the basis that if I decided to strike-out those paragraphs and/or further amendments to the pleading were required, it would be pointless for the document to be filed at this stage: Research in Motion Ltd v Samsung Electronics Australia Pty Ltd [2009] FCA 320; (2009) 176 FCR 66, [21]-[22] (Kenny J).

7    In the circumstances, I treat the application as an oral application by the applicant for leave to file the draft amended statement of claim as a further amended statement of claim pursuant to FCR 16.53 and 17.01(3). Accordingly, the issue is whether leave should be granted to the applicant to file the draft further amended statement of claim in its current form.

Documents relied upon

8    The respondents read, without objection from the applicant or the Union:

(i)    The affidavit of Michael Ats sworn and filed on 9 February 2022 (“first Ats affidavit”);

(ii)    The affidavit of Michael Ats sworn and filed on 10 February 2022 (“second Ats affidavit”); and

(iii)    The affidavit of Michael Ats sworn on 7 March 2022 but filed on 8 March 2022 (“third Ats affidavit”).

9    The respondents object to the following paragraphs of the draft further amended statement of claim:

(i)    [19A]-[19C] inclusive;

(ii)    [21A]-[21C] inclusive;

(iii)    [57A]-[57C] inclusive; and

(iv)    [58A]-[58C] inclusive.

Background

10    The background to this matter may be shortly stated. Where I describe the factual circumstances, it is taken from the draft further amended statement of claim and must be seen as me describing what has been alleged.

11    On 30 August 2021, officers of the Union visited a construction site at the Yatala Labour Prison (“Site”) situated at Northfield, South Australia. At the time, the Site was occupied by Mossop Group Pty Ltd as head contractor (“Contractor”) for the purpose of carrying out construction works relating to the redevelopment of Yatala Labour Prison pursuant to a contract with the State of South Australia.

12    There are other visits alleged but for the purposes of this application the only relevant visit is 30 August 2021.

13    The officers of the Union attending the site on 30 August 2021 were:

(i)    The second respondent, Wyatt Daniel Raymount (“Raymount”);

(ii)    The third respondent, Alexandria Jamie Russell (“Russell”);

(iii)    The fourth respondent, Travis Alton Brook (“Brook”); and

(iv)    The fifth respondent, Desmond Taivairanga Savage (“Savage”).

14    The paragraphs of the draft further amended statement of claim to which the respondents and the Union object concern only Raymount and Russell.

15    The employees of the Contractor alleged to be the subject of the actions of Raymount and Russell are:

(i)    Matthew Sweeney (“Sweeney”) the Safety Supervisor on the Site;

(ii)    Luis Simoes (“Simoes”) the State Quality Health Safety and Environment Manager; and

(iii)    Damian Gesuato (“Gesuato”), the Site Manager.

16    I will set out the allegations against Raymount and Russell in greater detail later in these reasons, however in general terms it is alleged against both of them during their visit to the Site on 30 August 2021, that they both engaged in conduct in contravention of s 500 of the Fair Work Act 2009 (Cth) (“Act”), and were both knowingly concerned within the meaning of s 550(2)(c) of the Act in the contravention of s 500 by the other.

Principles

17    Notwithstanding this is not, strictly speaking, a strike-out application, nevertheless the principles which apply to an application to strike-out an action or parts of a pleading are applicable and well-settled.

18    In Banque Commerciale SA (En Liquidation) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279, 286, Mason CJ and Gaudron J describe the function of pleadings in the following terms:

The function of pleadings is to state with sufficient clarity the case that must be met: Gould and Birbeck and Bacon v. Mount Oxide Mines Ltd. (In liq.) (25), per Isaacs and Rich JJ. In this way, pleadings serve to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him or her and, incidentally, to define the issues for decision.

19    The respondents rely on FCR 16.21(1)(d) and (e) which provide:

(1)    A party may apply to the Court for an order that all or part of a pleading be struck out on the ground that the pleading:

(a)    …

(b)    …

(c)    …

(d)    is likely to cause prejudice, embarrassment or delay in the proceeding; or

(e)    fails to disclose a reasonable cause of action or defence or other case appropriate to the nature of the pleading; or

(f)    ...

20    In Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552, [57], Gaudron, McHugh, Gummow and Hayne JJ said:

… Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way.

(Citations omitted)

21    In so doing, the High Court referred to the well-known statements in General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125, (“General Steel Industries”) 130 per Barwick CJ:

… in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand, I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed.

and Dey v Victorian Railways Commissioners [1949] HCA 1; (1949) 78 CLR 62, (“Dey”) 91 per Dixon J:

The application is really made to the inherent jurisdiction of the court to stop the abuse of its process when it is employed for groundless claims. The principles upon which that jurisdiction is exercisable are well settled. A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process.

22    Although the passages set out above from both General Steel Industries and Dey dealt with striking out actions which were frivolous and vexatious and an abuse of process, the same principles apply to other grounds upon which a strike-out is sought.

23    In Radisich v McDonald [2010] FCA 762; (2010) 198 IR 244, Gilmour J considered a number of authorities before stating at [20]:

The power to strike out pleadings or portions of pleadings is discretionary and should be employed sparingly and only in a clear case: Australian Competition and Consumer Commission v Pauls Ltd [2000] ATPR 40,641 (41-747) at [10] O'Loughlin J citing Brambles Holdings Ltd v Trade Practices Commission (1979) 40 FLR 364 at 365. Where such a case is made out the Court should not shrink from exercising its discretion to strike out the relevant pleading.

24    The respondents submit that the paragraphs in question are:

(i)    Likely to cause embarrassment in the proceedings (FCR 16.21(d)); and/or

(ii)    Failed to disclose a reasonable cause of action (FCR 16.21(e)); and/or

(iii)    Result in duplicity.

Embarrassment

25    Whether a pleading or part of a pleading is likely to cause embarrassment was considered by Collier J in Fair Work Ombudsman v Eastern Colour Pty Ltd [2011] FCA 803; (2011) 209 IR 263, [18], [19] (“Eastern Colour”). Although her Honour was dealing with the predecessor to FCR 16.21, nonetheless the principles remain applicable. Her Honour summarised and adopted the following relevant principles:

18.    So far as concerns the term “embarrassing”, the Full Court of the Supreme Court of Victoria in Meckiff v Simpson [1968] VR 62 at 70 explained that, in the context of pleadings, “embarrassing” includes defects resulting in the pleading being unintelligible, ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged against it.

19.    More recently in Spiteri v Nine Network Australia Pty Ltd [2008] FCA 905 at [22] Edmonds J said:

Embarrassment in the context of O 11 r 16 “carries the connotation of a pleading which is susceptible to various meanings, or contains inconsistent allegations or in which alternatives are confusingly intermixed or in which irrelevant allegations are made tending to increase expense. The list is not intended to be exhaustive”: Bartlett v Swan Television and Radio Broadcasters Pty Ltd (1995) ATPR 41-434.

A pleading which is internally inconsistent is embarrassing: Vasyli v AOL International Pty Ltd (NG 219/96) Lehane J, 19 August 1996, unreported. A pleading should assert the basic and constituent facts, not the evidence upon which those facts will or may be proved at trial. A pleading is defective if it simply asserts a conclusion to be drawn from the facts not stated: Trade Practices Commission v David Jones (Australia) Pty Ltd (1985) 7 FCR 109 at 114-115; and is not saved by using the words “[i]n the premises” to introduce the conclusion: Davids Holdings Pty Ltd v Coles Myer Ltd (1993) ATPR 41-227.

The pleading should enable the respondent to know, with sufficient clarity, the case which it is required to meet: Dare v Pulham (1982) 148 CLR at 664.

Failure to disclose a reasonable cause of action

26    The authorities make it clear that the power to strike-out a pleading because it discloses no reasonable cause of action is only exercised in plain and obvious cases, where it is clear no reasonable amendment can cure the alleged defect, and there is no reasonable question to be tried: see Allstate Life Insurance Co v Australia & NZ Banking Group Ltd [1994] FCA 636, (1994) 217 ALR 226 (reported Beaumont J 13/9/94); Polar Aviation Pty Ltd v Civil Aviation Safety Authority and Ors [2012] FCAFC 97, [40]-[43].

“Knowingly Concerned”

27    One of the complaints made by the respondents is the pleading in [19B], [21B], [57B] and [58B] that each of Raymount and Russell, as the case may be, was “involved” within the meaning of s 550 of the Act in the alleged contravention by the other of s 500 of the Act. Section 550 provides:

(1)    A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.

(2)    A person is involved in a contravention of a civil remedy provision if, and only if, the person:

(a)    has aided, abetted, counselled or procured the contravention; or

(b)    has induced the contravention, whether by threats or promises or otherwise; or

(c)    has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or

(d)    has conspired with others to effect the contravention.

28    The issue in relation to those paragraphs is the allegation that Raymount and/or Russell, as the case may be, were “involved” by being “knowingly concerned” in the contraventions of s 500: s 550(2)(c).

29    The respondents rely on Yorke v Lucas [1985] HCA 65; (1985) 158 CLR 661 (“Yorke v Lucas”). That case concerned accessorial liability for the purposes of s 75B of the Trade Practices Act 1974 (Cth) (“TPA”).

30    Section 75B provided that the reference to a person involved in a contravention of the TPA shall be read as a reference to a person who:

(a)    has aided, abetted, counselled or procured the contravention;

(b)    has induced, whether by threats or promises or otherwise the contravention;

(c)    has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention; or

(d)    has conspired with others to effect the contravention.

31    The issue before the Court included whether the respondent, Lucas, had been “knowingly concerned” in breaches of s 52 of the TPA and therefore liable for losses sustained as a person involved in the contravention.

32    Lucas was aware of the representations that had been made but had no knowledge of their falsity and did not participate intentionally in the conduct which amounted to the contravention of s 52.

33    The appellants contended that Lucas was liable on two grounds. The first being that he “aided, abetted, counselled or procured” the contravention within the meaning of s 75B(a), and the second that Lucas was “directly or indirectly, knowingly concerned in, or party to, the contravention” within the meaning of s 75B(c).

34    The appellant had submitted that there was no requirement in s 75B(a) or (c) of an intent on the part of Lucas based upon knowledge of material facts. Mason ACJ, Wilson, Deane and Dawson JJ rejected the submission that no intent was required for the purposes of s 75B(a), noting that the words “aided, abetted, counselled or procured” were taken from the criminal law where they were used to either designate participation in a crime as a principal or alternatively as an accessory before the fact. Their Honours noted that to be guilty of the offences of aiding, abetting or counselling and procuring an offence requires intentional participation and knowledge of the essential matters which go to make up the offence: Yorke v Lucas p 667.

35    As to s 75B(c) and being “directly or indirectly knowingly concerned in, or party to the contravention” their Honours said: Yorke v Lucas p 670:

… There can be no question that a person cannot be knowingly concerned in a contravention unless he has knowledge of the essential facts constituting the contravention.

Before concluding:

In our view. the proper construction of par. (c) requires a party to contravention to be an intentional participant, the necessary intent being based upon knowledge of the essential elements of the contravention.

36    In Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1293, White J considered the issue of whether officers of the Union were “knowingly concerned” in the contraventions alleged.

37    That matter involved contraventions by the Union and a number of its officials of, amongst other things, ss 348 and 500 of the Act across a number of building sites where LendLease was the head contractor. The Director alleged that one of the officials, Mr Lomax, contravened s 348 of the Act by acting as an accessory within the meaning of s 550 of the Act in the contravention of s 348 by other Union officials.

38    The Director relied on s 550(2)(a) and (c). His Honour dealt with s 550(2)(a) and what is required for aiding, abetting, counselling or procuring a relevant contravention, referring to Yorke v Lucas; Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213; (2002) 118 FCR 236 [159]-[160]; Rafferty v Madgwicks [2012] FCAFC 37; (2012) 287 ALR 437 [254]; and Giorgianni v The Queen (1985) 156 CLR 473, 506-7: at [109]-110].

39    His Honour then considered s 550(2)(c) and what is meant by “knowingly concerned” saying at [111]:

The notion of being “knowingly concerned” in a contravention has a different emphasis from that of “aiding, abetting, counselling or procuring” a contravention. To be knowingly concerned in a contravention, the person must have engaged in some act or conduct which “implicates or involves him or her” in the contravention so that there be a “practical connection” between the person and the contravention: Qantas Airways Ltd v Transport Workers’ Union of Australia [2011] FCA 470; (2011) 280 ALR 503 at [324]-[325]. See also Construction, Forestry, Mining and Energy Union v Clarke [2007] FCAFC 87; (2007) 164 IR 299 at [26].

Duplicity

40    A further complaint by the respondents in relation to the impugned paragraphs are that Raymount and Russell are alleged to be both primary offenders of and accessories to the same contravening conduct.

41    The respondents referred to the observations in Yorke v Lucas at pp 668-669 that the concept of being liable as an accessory in s 75B of the TPA is informed by the criminal law. However, the references to the criminal law by the High Court in that case were directed to s 75B(a) which is an aiding and abetting provision. In contrast, the respondents are alleged to have been “involved” by reason of s 550(2)(c) of the Act which is “knowingly concerned”. In Yorke v Lucas, the High Court did not deal with the application of the criminal law when dealing with the concept of “knowingly concerned” in s 75B(c) of the TPA.

42    The respondents also rely on Mallan v Lee [1949] HCA 48, (1949) 80 CLR 198. That was a case in which a company was charged with a contravention of s 230 of the Income Tax Assessment Act 1936-1944 (Cth) (“Income Tax Assessment Act”). The contravention alleged was that the company knowingly and wilfully understated the amount of its’ income in a return. In the same complaint, the appellant, Mallan, who had prepared the return, was charged with being “directly knowingly concerned in the commission of the offence” contrary to s 5 of the Crimes Act 1914-1946 (Cth) (“Crimes Act”).

43    The real question in Mallan was whether s 5 of the Crimes Act created a liability for the contravention of s 230 of the Income Tax Assessment Act. Dixon J held that rather than an offence against s 5, the provisions of s 230 were such that the actions of Mallan, by which the company was vicariously liable, also comprised a substantive offence on Mallan’s part. His Honour said: pp 213-214:

… The company's offence consists only in its vicarious responsibility for his alleged act in knowingly and wilfully understating on behalf of the company in its return the amount of income derived by the company. That act amounts in my opinion to an offence by him under s. 230 (1). The provision may be divided into two parts. The one part says that any person who in any return knowingly and wilfully understates the amount of any income or makes any misstatement affecting the liability of any person to tax or the amount of tax shall be guilty of an offence. The other part says that any company on whose behalf the public officer or a director servant or agent of the company in any return knowingly and wilfully understates the amount of any income or makes any misstatement affecting the liability of any person to tax or the amount of tax shall be guilty of an offence. A public officer cannot, I think, make his company responsible under the second part of the provision without himself becoming liable under the first part.

Before concluding on pp 215-216:

On the interpretation I have given to s. 230 (1), for more than one reason s. 5 of the Crimes Act cannot apply to a public officer so as to make him an accessory to the offence of the company. In the first place, the public officer's act on behalf of the company making it an offender ipso facto amounts to a substantive offence on his part under s. 230 (1). In the second place, the sub-section makes him the actor, the principal, for whose guilty conduct the company is responsible vicariously. It would be an inversion of the conceptions on which the degrees of offending are founded to make the person actually committing the forbidden acts an accessory to the offence consisting in the vicarious responsibility for his acts.

44    Relying on Mallan, the respondents submit that a person cannot be an accessory to his or her own acts.

45    The respondents also refer to s 556 of the Act which provides:

556 Civil double jeopardy

If a person is ordered to pay a pecuniary penalty under a civil remedy provision in relation to particular conduct, the person is not liable to be ordered to pay a pecuniary penalty under some other provision of a law of the Commonwealth in relation to that conduct.

46    They submit that s 556 does not extend to allowing a person to be liable both as a primary contravenor as well as an accessory for the same conduct.

47    In response, the applicant submits, first that the draft further amended statement of claim pleads contraventions of s 500 against each of Raymount and Russell in respect of their own individual conduct, and separately, contravention of s 500 by reason of their involvement in the contravening conduct of the other within the meaning of s 550(2)(c).

48    Second, the applicant submits that it is open to the legislature to create multiple offences arising out of the same or similar conduct. It refers to Esso Australia Pty Ltd v Australian Workers’ Union [2016] FCAFC 72; (2016) 245 FCR 39, [213] (Bromberg J) where his Honour said:

… It is open to the legislature to create multiple offences arising out of the same, or similar, conduct. It does not infringe some overriding imperative of our system of civil law to contemplate multiple findings of contravention.

49    Third, s 556 is directed at penalty, not contravention, and there is no reason why a party cannot be found liable for two contraventions arising out of the same conduct.

50    Fourth, the concept of duplicity is directed at ensuring that a party is given fair notice of which charge that party is facing arising out of the impugned conduct. It is for that reason why there are multiple counts on the one indictment. The applicant submits that the same principle applies in civil pleadings and the requirement to give fair notice of the case the respondent has to meet. It refers to Walsh v Tattersalls [1996] HCA 26; (1996) 188 CLR 77 and the judgment of Kirby J where his Honour considered previous decisions in which questions of duplicity in criminal proceedings had arisen. His Honour said: pp 104-105:

In order to resolve the point of principle presented by this appeal, it is useful to examine a number of previous decisions in which questions of duplicity in criminal pleadings have arisen:

1. The rule against duplicity has its origin in the history of English criminal procedure. It is a product of the accusatorial trial which has long insisted upon precision in the statement of the charge which the accused has to meet. Under the rule of precision, no one count of the indictment should charge the accused with having committed two or more separate offences. The rule has long been regarded by this Court as an important one. Even where the Court was satisfied that the accused, taking the point, had no substantive merits, except the legal merit of the objection to duplicity, the latter was held to be sufficient if the complaint as to form were made out. In that event, the count of the indictment would be bad for duplicity. It would have to be quashed.

51    The applicant submits that in any event, duplicity in this case either does not apply or if it does, it has a very limited role to play in civil proceedings. It refers to McSteen v Architects Registration Board of Victoria [2018] VSCA 96 [43], which was a case concerning disciplinary proceedings against an architect and the observations of the Court of Appeal that the underlying basis of the rule against duplicity has application to disciplinary charges.

52    Next, the applicant refers to Parker v Australian Building and Construction Commissioner [2019] FCAFC 56; (2019) 270 FCR 39 (“Parker”). Parker was recently considered by the High Court in Australian Building and Construction Commissioner v Kevin Pattinson and Anor [2022] HCA 13 but in the context of penalty, not accessorial liability and/or duplicity.

53    In Parker, the Full Court of this Court (Besanko, Reeves and Bromwich JJ) considered, amongst other things, accessorial liability under s 550 of the Act and the question of duplicity. The respondent Commissioner had cross-appealed, contending that at first instance, the primary judge had failed to determine an accessorial case pleaded against some of the individual appellants who were, in turn, respondents to the cross-appeal.

54    Besanko and Bromwich JJ (Reeves J agreeing) said: [244]-[246]:

244    The appellants' response is to point to longstanding authority of the High Court in Mallan v Lee (1949) 80 CLR 198 (Mallan v Lee) at 216 in a criminal law context, to the effect that a person cannot be an accessory to his or her own act. Mallan v Lee was applied by French J, when his Honour was a member of this Court, in the trade practices case of Wright v Wheeler Grace & Pierucci Pty Ltd [1988) ATPR 40-865 (Wright v Wheeler Grace) at 49,376-49,377. There is an immediate problem with the appellants' reliance on this decision: the finding on liability was overturned on appeal in Wheeler Grace & Pierucci Pty Ltd v Wright (1989) 16 IPR 189 (Wheeler Grace v Wright). The Full Court explicitly drew the distinction that was relied upon by the Commissioner, saying (at 206-209):

... His Honour considered such conduct could not be accessorial conduct with which s.75B of the Act was concerned. It was his Honour's view that separate and distinct conduct on the part of Collins was required before s.75B of the [Trade Practices] Act could apply and impose liability on Collins as a person involved in the contravention of the Act by the appellant.

Of course his Honour did not have the benefit of the recent statement of the High Court in Hamilton v. Whitehead [1989] 63 A.L.J.R. 80 delivered on 7 December 1988.

…

In Hamilton v. Whitehead it was pointed out that the relevant provisions of the Trade Practices Act 1974 were like provisions to s.169 of the Companies (Western Australia) Code, but unlike the provisions of s.230 of the Income Tax Assessment Act 1936 as considered in Mallan v. Lee in that a direct liability was imposed on the company for acts done by persons who embodied the company. There was no imposition of vicarious liability upon the company for actions of servants or agents of that company.

…

Accordingly, it must follow that the appellant was directly liable for its acts through Collins for any contravention of s.52 and that Collins was a person on whom s.75B of the Act could impose accessorial liability.

245    The Commissioner's reply, while not referring to the Full Court decision in Wheeler Grace v Wright, draws the same distinction between a case in which the principal offender - or contravener - is the individual also impermissibly said to be an accessory to his or her own contravening conduct, and a case in which the principal corporate or equivalent offender - or contravener - is directly liable by the actions of the individual, in which case the individual can be an accessory in a personal capacity to conduct carried out in that corporate capacity.

246    The Commissioner's submission finds strong support in Hamilton v Whitehead (1988) 166 CLR 121 (Hamilton v Whitehead) at 128, in which, as the Full Court noted in Wheeler Grace v Wright, was decided after French J's decision at first instance. In Hamilton v Whitehead, the situation was relevantly different so as to be distinguishable from Mallan v Lee, because the company was the principal offender, albeit via the actions of the individual charged as an accessory to the company's conduct. The High Court said of that situation:

There is nothing conceptually wrong in such a course since "it is a logical consequence of the decision in Salomon's Case [[1897] AC 22] that one person may function in dual capacities": Lee v. Lee's Air Farming Ltd. [[1961] AC 12 at 26]. In Reg. v. Goodall [(1975) 11 SASR 94 at 100] Bray CJ. discussed what his Honour described as: "some sort of metaphysical bifurcation or duplication of one act by one man so that it is in law both the act of the company and the separate act of himself as an individual" and expressed his conclusion as follows [at 101]: "my view is that the logical consequence of Salomon's Case ... is that the company, being a legal entity apart from its members, is also a legal person apart from the legal personality of the individual controller of the company, and that he in his personal capacity can aid and abet what the company speaking through his mouth or acting through his hand may have done." We agree with this view.

55    It is against that background that I now turn to the respondents’ complaints.

The impugned paragraphs

56    The respondents object to [19A]-[19C] inclusive, [21A]-[21C] inclusive, [57A]-[57C] inclusive, and [58A]-[58C] inclusive of the draft further amended statement of claim.

[19A]-[19C]

57    The respondents object to these paragraphs on the basis that they:

(i)    Fail to disclose a reasonable cause of action;

(ii)    Are likely to cause prejudice, embarrassment or delay; and/or

(iii)    Are duplicitous.

58    Prior to considering these objections it is necessary to set out this part of the pleading and certain of the paragraphs that precede it in order to give the pleading context.

59    The pleadings that relate to this section of the pleading commence at [11] and are as follows:

B.    30 AUGUST 2021

B.1    Arrival of Raymount, Russell, and Brook at the Project

11.    On 30 August 2021, at about 7:05am, each of Raymount, Russell, and Brook:

(a)    arrived at the Project’s Site Safety Office;

(b)    issued a notice of entry (NOE) under the WHS Act to Sweeney, each detailing reasonably suspected contraventions of the WHS Act;

(c)    produced their federal and state entry permits to Sweeney.

12.    In the circumstances, while at the Project on 30 August 2021, each of Raymount, Russell, and Brook:

(a)    were exercising, or seeking to exercise, rights in accordance with Part 3-4 of the FW Act; and

(b)    had knowledge that each of the other permit holders in their party were exercising, or seeking to exercise, such rights.

Particulars

•    The permit holders were exercising the right to enter the Project under s 494(2) of the FW Act to exercise a “State or Territory OHS right”.

•    The “State or Territory OHS right” of each of the CFMMEU officials is found in s 117 of the WHS Act, namely inquiring into a suspected contravention of the WHS Act that relates to, or affects, a relevant worker.

•    The knowledge of each of Raymount, Russell, and Brook pleaded in paragraph 12(b) is to be inferred from the whole of the surrounding facts and circumstances, including that they entered the Project together, issued a NOE in the presence of one another, and produced their permits in the presence of one another.

B.2    Improper conduct during site walk

13.    Between 7:05am to 8:30am, Raymount, Russell, and Brook:

(a)    entered the work site on the Project (the Site).

(b)    were accompanied by Sweeney or Gesuato (or both) throughout the period they were on Site;

(c)    walked around the outside of various buildings on the Site looking at access and egress.

14.    While looking at the access and egress:

(a)    Raymount said to Sweeney: “you’re useless”;

(b)    Russell said to Sweeney: “you should be ashamed of yourself” and “you’re incompetent”.

15.    Raymount and Russell each made multiple statements directed to Sweeney and Gesuato to the effect: “you’re shit at your job” and “you’re bloody useless”.

Particulars

•    These statements were made by each of Raymount and Russell on occasions: prior to the Site walk; while the parties were still at the Site Safety Office; during the Site walk; and while the parties were walking to and observing the access and egress on the Site.

16.    The statements made by Raymount and Russell, as pleaded in paragraphs 14 and 15, were abusive, derogatory, and offensive.

Particulars

•    The abusive, derogatory, and offensive nature of the statements are evident from their content.

17.    By reason of the matters pleaded in paragraphs 14 to 16 above, Raymount acted in an improper manner while exercising, or seeking to exercise, rights in accordance with Part 3-4 of the FW Act.

18.    By reason of the matters pleaded in paragraphs 14 to 16 above Russell acted in an improper manner while exercising, or seeking to exercise, rights in accordance with Part 3-4 of the FW Act.

Raymount contraventions

19.    By reason of the matters in paragraphs 14 to 17 above, Raymount contravened s 500 of the FW Act (Raymount direct s 500 contravention);

19A.    Further, Raymount participated in and failed to disassociate himself from the conduct of Russell as pleaded in paragraphs 14 to 16 herein.

19B.    By reason of the matters pleaded in paragraph 12(b), 13 to 15 and 19A above, Raymount was directly or indirectly, knowingly concerned in or a party to the Russell direct s 500 contravention referred to in paragraph 20 herein, and was, by operation of s 550(2)(b) of the FW Act, therefore “involved in” that contravention of Russell.

19C.    By reason of the above, and by operation of s 550(1) of the FW Act, Raymount himself contravened s 500 of the FW Act in respect of the Russell direct s 500 contravention (Raymount accessorial s 500 contravention).

(track changes deleted)

The Parties’ Submissions

60    The respondents submit that the pleading in [19A] that Raymount “participated in and failed to disassociate himself” from the conduct of Russell pleaded in [14]-[16] is a pleading in substitution for the statutory language of “knowingly concerned” used in [19B].

61    They point to [14] as being a problematic paragraph in the sense that although in that paragraph there is a direct pleading that Raymount said certain words to Sweeney which are alleged to amount to a contravention of s 500, it is not clear that when the applicant pleads accessorial liability, whether the applicant is relying upon what Raymount said to Sweeney, or upon Raymount’s presence when Russell said the alleged words to Sweeney. They submit that on one view, the applicant is pleading both principal liability and accessorial liability on the part of Raymount arising out of the same words said by him to Sweeney.

62    As to [15], the respondents point to the pleading that both Raymount and Russell made multiple statements directed to Sweeney and Gesuato but it is not clear how that relates to the pleading in [19A] that Raymount “participated in” Russell’s conduct pleaded in [14]-[16].

63    The respondents submit that the material facts necessary to support the allegation of Raymount being “knowingly concerned” in Russell’s acts had not been pleaded.

64    The respondents refer to Australian Building and Construction Commissioner v Hall and Others (2018) 261 FCR 347; [2018] FCAFC 83 at [19], [49]-[50] (Tracey, Reeves and Bromwich JJ) which was a case dealing with civil penalty provisions. At [19] the Court said:

… This means that, in a proceeding such as the present one, which was conducted on pleadings, an applicant is required to plead his or her statement of claim all the material facts concerning the contraventions alleged against the respondent. As French J said in Kernel Holdings Pty Ltd v Rothmans of Pall Mall (Australia) Pty Ltd (1991) 217 ALR 171 at 173, “[a] material fact is one which is necessary to formulate a complete cause of action. ... Material facts must be pleaded with the degree of specificity necessary to define the issues and inform the parties in advance of the case they have to meet.”

65    The applicant submits that as to the use of the word “participated” in [19A], the allegation is directed at the conduct of Raymount and Russell as from the time they entered the Site. To that extent, whereas the direct contravening conduct is readily identifiable and confined in the case of both Raymount and Russell to [14], [15], insofar as each of them is alleged to have participated in the conduct of the other contrary to s 550(2)(c) such as to found accessorial liability, the conduct is broader and goes back to the allegations commencing from [11].

66    In the case of Raymount, it is alleged he contravened s 500, and in addition participated in and failed to disassociate himself from Russell’s conduct, pleaded in [14] and [15], leading to the pleading in [19B] that Raymount was directly or indirectly knowingly concerned in or a party to Russell’s contravention of s 500 (pleaded in [20]). On that basis, the applicant submits that the material facts necessary to support the allegation against Raymount of being “knowingly concerned” have been pleaded.

Consideration

67    Although the respondents identify three specific categories of objection, with the exception of duplicity, the objections as to the pleading being embarrassing and not disclosing a reasonable cause of action overlap. I will, however, deal with each of the categories of objection separately.

Embarrassment

68    The pleading in [14] differentiates specifically between what was said by Raymount and Russell respectively. In [15], although specific words are not differentiated, it is clear the pleading refers to both Raymount and Russell each making multiple statements directed to Sweeney and Gesuato to the effect pleaded.

69    The pleading makes it clear that statements are being attributed to Raymount and/or Russell.

70    I do not consider the pleading is embarrassing in the sense that it is not unintelligible, ambiguous, vague or too general as to embarrass the opposite party who does not know what is alleged against: Eastern Colour Pty Ltd [2011] FCA 803; (2011) 209 IR 263, [18], [19] (Collier J).

71    A plain reading of these paragraphs of the draft amended statement of claim, with one exception to which I will come to below, reveals both allegations of direct contravening of s 500 on the part of Raymount, and accessorial liability on his part in the alleged direct contravening of s 500 by Russell.

72    The exception, to which I have referred, is the use of the word “participated” in [19A]. I accept the respondents’ submission that without further particularity, the use of the word is vague and requires the respondents to speculate as to what is being alleged as against Raymount. Accordingly, I would not grant leave to file the draft further amended statement of claim with [19A] in its current form. Counsel for the applicant accepted during argument that further particularity of the allegation that Raymount had “participated” was required. He said that the allegation that Raymount “participated” was a reference to the course of conduct of Raymount (and Russell as the case may be) on 30 August 2021 as pleaded from [11] and the following paragraphs of the draft further amended statement of claim.

73    In the event that sufficient particularity is provided, I consider that the pleading will no longer be embarrassing.

No reasonable cause of action

74    The complaint about the pleading not disclosing a reasonable cause of action is directed at the words “failed to disassociate” in [19A]. Although the respondents submit that “failed to disassociate” is being used in substitution for the words “directly or indirectly knowingly concerned”, which appear in s 550(2)(c), I do not accept that submission. It is clear to me on a plain reading of these paragraphs that the conduct alleged in [19A] is relied upon, in addition to the other paragraphs identified in [19B], and is alleging Raymount was “directly or indirectly knowingly concerned” in, or a party to, Russell’s direct contravention of s 500 of the Act.

75    Further, the pleading in [19A] of a “failure to disassociate” is self-evident. Adopting, with respect, White J’s statement of what comprises being “knowingly concerned” in Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1293, [111], the pleading clearly alleges that Raymount had engaged in conduct which “implicates or involves him or her” in the contravention such that there is a “practical connection” between Raymount to Russell’s direct contravention of s 500.

76    Accordingly, I consider that the relevant material facts have been pleaded such that I do not accept the respondents’ submission that there is no reasonable cause of action identified in these paragraphs.

Duplicity

77    As I set out above, my view is that the pleading differentiates between direct contravening on the part of Raymount and accessorial liability by Raymount in the direct contravening conduct of Russell.

78    Section 550(2)(c) operates to make a person involved in a contravention of a civil remedy provision as being taken to have contravened that provision. To that extent, the section operates to make Raymount a person who has contravened s 500 by being “involved” in Russell’s contravention of s 500, such that there is no duplicity.

79    Insofar as the Union is concerned, Mr Russell, who appeared for the Union, adopted Dr Gray’s submissions for the respondents. The Union submitted that it is alleged in [120] that by reason of ss 363 and/or 793 of the Act, the conduct of Raymount is the conduct of the Union. It observes that [120] pleads that by operation of these two sections, the Union was “knowingly concerned” in the conduct of, relevantly, Raymount and Russell and therefore “involved” in the contravention of ss 499 and 500 of the Act by Raymount and Russell (amongst others) within the meaning of s 550(2)(c).

80    The Union points to [121] which pleads:

[121]    In the premises, the CFMMEU was directly or indirectly, knowingly concerned in, or party to:

(a)    each of Raymount’s contraventions of ss 499 and 500 of the FW Act;

(b)    each of Russell’s contraventions of ss 499 and 500 of the FW Act;

(c)    each of Brook’s contraventions of ss 499 and 500 of the FW Act;

(d)    each of Savage’s contraventions of s 500 of the FW Act,

and is thereby pursuant to s 550(1) of the FW Act itself involved in and taken to have contravened the FW Act on each and every occasion alleged above.

81    The Union submits the pleading is bad for duplicity because it pleads that the Union is responsible both as a direct contravener and as an accessory to that contravention. It is for the same reasons I set out above, in relation to the respondents, that I do not accept that submission. The reference to ss 363 and 793 of the Act, is directed to the knowledge of the Union and the Union being “knowingly concerned” in the conduct of, amongst others, Raymount and Russell, and thereby “involved” in the contraventions of ss 499 and 500 by Raymount and Russell. The pleading clearly differentiates between the direct contravention of ss 499 and 500 by Raymount and Russell and the liability of the Union consequent upon the operation of s 550 of the Act.

82    The observations of Besanko and Bromwich JJ in Parker at [244]-[246], set out above, are applicable. This is not a case where the Union is vicariously liable for the actions of, amongst others, Raymount and Russell. As their Honours noted in Parker, in Hamilton v Whitehead [1988] HCA 65; (1988) 166 CLR 121, 128 (Mason CJ, Wilson and Toohey JJ) said:

… Counsel for the respondent sought to gain some comfort from the words of Dixon J. in Mallan v. Lee. But, as we have sought to explain, the inversion of which his Honour spoke has no application here. The company is not vicariously liable for the actions of the respondent. The company is the principal offender and the respondent is charged as an accessory. Franklyn J. thought that it was "wrong and oppressive" to prosecute the respondent for the identical acts and decisions as were relied on as the acts of the company. There is nothing conceptually wrong in such a course since "it is a logical consequence of the decision in Salomon's Case that one person may function in dual capacities": Lee v. Lee's Air Farming Ltd. In Reg. v. Goodall Bray C.J. discussed what his Honour described as: "some sort of metaphysical bifurcation or duplication of one act by one man so that it is in law both the act of the company and the separate act of himself as an individual" and expressed his conclusion as follows (26): "my view is that the logical consequence of Salomon's Case ... is that the company, being a legal entity apart from its members, is also a legal person apart from the legal personality of the individual controller of the company, and that he in his personal capacity can aid and abet what the company speaking through his mouth or acting through his hand may have done." We agree with this view.

(Footnote references omitted)

83    In Australian Building and Construction Commissioner v McDermott (No 2) (2017) 252 FCR 393; [2017] FCA 797, when dealing with the same point as the Union now submits, Charlesworth J said at [121]:

121    To the extent that it is necessary to show that CFMEU involved itself in some tangible way in the contraventions of its officials, there is no reason why s 793 should not facilitate proof of that requirement. Section 793 is premised on an accepted fiction that a body corporate is a separate legal entity from those who participate in it: Salomon v A Salomon & Co Pty Ltd [1897] AC 22. Accepting that fiction, it does not matter that the deemed physical acts of the secondary participant are the same acts in fact engaged in by the primary contravener. CFMEU did not make any submission to the contrary. Accordingly, the physical acts of Mr McDermott and Mr Cartledge are, in each instance, taken also to be the acts of CFMEU. That is sufficient to demonstrate CFMEU’s participation in each contravention.

[21A]-[21C]

84    These paragraphs (together with [20]) plead:

20.    By reason of the matters in paragraphs 14 to 16 and 18 above, Russell contravened s 500 of the FW Act (Russell direct s 500 contravention).

21A.    Further, Russell participated in and failed to disassociate herself from the conduct of Raymount as pleaded in paragraphs 14 to 16 herein.

21B.    By reason of paragraphs 12(b), 13 to 15 and 21A herein, Russell was directly or indirectly, knowingly concerned in or a party to the Raymount direct s 500 contravention referred to in paragraph 19 herein, and was, by operation of s 550(2)(b) of the FW Act, therefore “involved in” the contravention of Raymount.

21C.    By reason of the above, and by operation of s 550(1) of the FW Act, Russell herself contravened s 500 of the FW Act in respect of the Russell direct s 500 contravention (Russell accessorial s 500 contravention).

(Tracking omitted)

85    The respondents and the Union repeat their submissions made in relation to [19A]-[19C] for these paragraphs. It is for the same reasons, as I have set out above, that I would not grant leave to file the document without further particulars being provided of the allegation of participation by Russell in [21A]. Save for this item, I do not accept the submissions made by the respondents and the Union in opposition to these paragraphs.

[57A]-[57C]

86    These paragraphs cross-refer to [12(b)] and [53]-[55]. I have set out [12(b)] above at [59]. I set out [53]-[55] below:

53.    In addition to the matters pleaded above, during the remainder of the Site walk on 30 August 2021:

(a)    Raymount said to Simoes: “Luis you are fucking useless at your job, I can’t believe you call yourself a professional, you should be ashamed”;

(b)    Russell said to Simoes: “Completely fucking useless, you are going to kill someone”;

(b)    Russell said to Simoes: “Seriously aren’t you ashamed? It’s amazing how useless you are”;

(c)    Raymount walked directly up to Simoes and, while standing 30 to 40 cms away from him, said: “How can you get up every morning and do a shit job? Aren’t you ashamed?”

54.    Each of the statements made by Raymount and Russell that are set out in paragraph 53 herein made, were abusive, derogatory, and offensive.

Particulars

•    The abusive, derogatory, and offensive nature of the statements are evident from their content.

55.    By reason of each of the matters pleaded in paragraphs 53(a) and (d) and 54 herein, Raymount acted in an improper manner while exercising, or seeking to exercise, rights in accordance with Part 3-4 of the FW Act.

56.    By reason of each of the matters pleaded in paragraphs 53(b) and (c) and 54 herein, Russell acted in an improper manner while exercising, or seeking to exercise, rights in accordance with Part 3-4 of the FW Act.

Raymount contraventions

57.    By reason of each of the matters pleaded in paragraphs 53 to 55, Raymount: contravened s 500 of the FW Act (Raymount direct s 500 contravention).

57A.    Further, Raymount participated in and failed to disassociate himself from the conduct of Russell as pleaded in paragraphs 53 and 54 herein.

57B.    By reason of paragraphs 12(b), 53 and 57A herein, Raymount was directly or indirectly, knowingly concerned in or a party to the Russell direct s 500 contravention referred to in paragraph 58 herein, and was, by operation of s 550(2)(b) of the FW Act, therefore “involved in” the contravention of Russell.

57C.    By reason of the above, and by operation of s550(1) of the FW Act, Raymount himself contravened s 500 of the FW Act in respect of the Russell direct s 500 contravention (Raymount accessorial s 500 contravention).

(Tracking omitted)

87    The respondents observe that the pleading is similar in format to [19A]-[19C] and [21A]-[21C] but submit there is a difference in that [53] pleads under the heading “Additional Improper Conduct During Site Walk” allegations directed at both Raymount and Russell, but this time to Simoes. The respondents submit that the same problem exists for [57A]-[57C] as is the case for [19A]-[19C] and [21A]-[21C] in that there is no detail on how Raymount “participated”. On that basis, the respondents submit there is no material fact pleaded in [57B] as to how it is that Raymount was knowingly concerned in the contravention by Russell.

88    I have dealt with this issue earlier in these reasons in relation to [19A]-[19C]. I accept the respondents’ submission that the pleading of Raymount’s participation in [57A] is insufficient and further particulars of how Raymount “participated” need to be provided. Accordingly, I would not grant leave to file the draft further amended statement of claim without those particulars being provided. Save for that matter, I do not accept the balance of the respondents’ objections to these paragraphs.

[58A]-[58C]

89    These paragraphs together with [58] provide:

Russell contraventions

58.    By reason of each of the matters pleaded in paragraphs 53, 54, and 56 herein, Russell: contravened s 500 of the FW Act (Russell direct s 500 contravention).

58A.    Further, Russell participated in and failed to disassociate herself from the conduct of Raymount as pleaded in paragraphs 53 and 54 herein.

58B.    By reason of paragraphs 12(b), 53 and 58A herein, Russell was directly or indirectly, knowingly concerned in or a party to the Raymount direct s 500 contravention referred to in paragraph 57 herein, and was, by operation of s 550(2)(b) of the FW Act, therefore “involved in” the contravention of Raymount.

58C.    By reason of the above, and by operation of s 550(1) of the FW Act, Russell herself contravened s 500 of the FW Act in respect of the Raymount direct s 500 contravention (Russell accessorial s 500 contravention).

(Tracking omitted)

90    The respondents repeat their previous submissions in relation to these paragraphs.

91    Once again, I would not grant leave to file the draft further amended statement of claim in circumstances where the pleading of Russell’s participation in [58A] requires further particularisation. Save for that point, I do not accept the balance of the respondents’ submissions objecting to these paragraphs.

Conclusion

92    I refuse leave to the applicant to file the draft further amended statement of claim provided to the respondents and handed to the Court just prior to argument. I have identified those paragraphs of the pleading which require further particulars.

93    I will hear the parties as to any further orders they seek.

Associate:

Dated:    6 May 2022

SCHEDULE OF PARTIES