Airservices' primary submission
61 Airservices accepts that the existence of an accord and satisfaction is at the heart of whether or not a justiciable controversy remains, and that as the moving party it has the onus of establishing that there has been an accord and satisfaction such that any relevant justiciable controversy has been extinguished, and there is no "matter". I am not persuaded that there is no "matter" arising under the FWA.
62 First, in my view, Airservices' submissions misapply the principles applicable to the legal consequences of the determination of rights and liabilities by arbitration.
63 An arbitral award operates "as a satisfaction, pursuant to [the parties] prior accord of the causes of action awarded upon" (emphasis added): Dobbs at 653. In TCL (at [77]) the plurality endorsed the statement in Dobbs (at 653) that, "if, before the institution of an action, an award was made, it [the award] governed the rights of the parties and precluded them from asserting in the Courts the claims which the award determined" (emphasis added). As the plurality said in TCL (at [78]) "the making of the award…both extinguishes the original cause of action and imposes new obligations on the parties in substitution for the rights and liabilities which were the subject of the dispute referred to arbitration. The former rights and liabilities of the parties are discharged by an accord and satisfaction" (emphasis added). In my view, while an arbitral award extinguishes the parties' rights and liabilities in relation to "the claims which the award determined" it does not operate to extinguish their rights and liabilities in relation to claims which were not determined. Yet that is the result of Airservices' argument. In my view it is the parties' rights and liabilities in relation to the "original" cause of action or claim "awarded upon" which are extinguished by an arbitral award, and not the parties' rights and liabilities in relation to any cause of action or claim which was not "awarded upon". Any such cause of action or claim was not the subject of the arbitration.
64 In Letang v Cooper [1965] 1 QB 232 at 242-3 Lord Diplock explained that a cause of action is "simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person". To assert a cause of action is to assert that facts exist which, if proven, would constitute a contravention of a legal norm by another person. Such facts may, of course, constitute contraventions of more than one recognised legal norm, and there may exist more than one cause of action in respect of the same facts. That is significant in the present case because it is plain that not all of the causes of action or claims that Civil Air asserts were capable of being arbitrated by the FWC, and in my view it is plain from the FWC Decision that they were not all the subject of the arbitration.
65 It is trite that the FWC had no power to make declarations of contravention of s 50 of the FWA in relation to any failures to comply with any terms of the EA which it found, nor any power to order the imposition of a pecuniary penalty, nor (although not claimed in this proceeding) any power to order compensation to Civil Air or its members.
66 Section 545 of the FWA and s 21 of the FCA are the relevant sources of power to make declarations of contravention of s 50. Section 545 is headed "Orders that can be made by particular courts". Subsection (1) empowers the Federal Court or the Federal Circuit Court to make any order the court considers appropriate if the court is satisfied that the person has contravened or proposes to contravene a civil remedy provision. Section 50 of the FWA is a civil remedy provision. It provides that "a person must not contravene a term of an enterprise agreement". Section 545(2) of the FWA provides, without limiting s 545(1), that the available orders include: injunctive relief (s 545(2)(a)); orders requiring compensation to be paid by the contravening party for loss suffered (s 545(2)(b)); an order for reinstatement of a person (s 545(2)(c)). The FWA does not provide corresponding powers to the FWC.
67 Section 546 of the FWA is headed "Pecuniary penalty orders". Subsection (1) provides that the Federal Court, the Federal Circuit Court or an eligible State or Territory court may order a person to pay a pecuniary penalty if the Court is satisfied that the person has contravened a civil remedy provision. The FWC is not so empowered.
68 In my view the FWC could only determine that part of the justiciable controversy between the parties that went to arbitration, and not any part or parts which did not. By the making of the FWC Decision the parties' rights and liabilities in relation to the causes of action or claims "awarded upon" were extinguished and replaced by the arbitral award, but any other rights or liabilities beyond those were not extinguished. Thus, there remains a "matter" and the Court has jurisdiction.
69 At least in part, Airservices' argument that the entirety of the justiciable controversy between the parties was extinguished by a determination of what was, necessarily, only part of the controversy, seems to be based in a misconception as to the breadth of what may constitute a "matter". In Palmer at [26]-[27] the plurality explained:
A "matter", as a justiciable controversy, is not co-extensive with a legal proceeding, but rather means the subject matter for determination in a legal proceeding - "controversies which might come before a Court of Justice". It is identifiable independently of proceedings brought for its determination and encompasses all claims made within the scope of the controversy. What comprises a "single justiciable controversy" must be capable of identification, but it is not capable of exhaustive definition. "What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships".
The requirement that, for there to be a "matter", there must be an "immediate right, duty or liability to be established by the determination of the Court" reinforces that the controversy that the court is being asked to determine is genuine, and not an advisory opinion divorced from a controversy, and, further, that only a claim is necessary. A matter can exist even though a right, duty or liability has not been, and may never be, established.
(Emphasis in original. Citations omitted.)
70 A "matter" in the sense of a justiciable controversy is identifiable independently of a proceeding brought in relation to it, and it includes all controversies between the parties which might come before a court or courts. Different parts of the one justiciable controversy may be fought in different places. Thus a proceeding in one court might advance claims only in respect to a part of the justiciable controversy and another proceeding might advance claims in respect to another part. For there to be a "matter" there must be "an immediate right, duty or liability to be established by the determination of the Court" and only a claim is necessary.
71 To determine what comprises the justiciable controversy or "matter" in the present case it is necessary to consider what justiciable controversies exist between the parties which might come before a court. In the present case the immediate rights and liabilities to be established by a court are Civil Air's claim for, and Airservices' liability for, declarations of contravention of s 50 of the FWA Act and the imposition of pecuniary penalties. Those claims could not be brought before the FWC and could only be brought before a court of competent jurisdiction. The error in Airservices' argument is that it seeks to bundle up the parties' rights and liabilities in relation to the entirety of the claims Civil Air might make and say that they were all determined by the FWC Decision, and thereby extinguished, when some parts of the justiciable controversy could not be and were not determined by the FWC.
72 Nor do I accept Airservices' argument that the dispute decided by the FWC was relevantly broader than the Questions for Determination in Civil Air's Concise Summary. In asserting that the dispute was broader Airservices relied on the issues referred to in the Dispute Notification (see [53] above) and noted that the FWC Decision said (at [12]) that "[i]n characterising the nature of a dispute the Commission is not confined to the application filed to deal with the dispute". It also noted the FWC Decision (at [12]) which said that "[t]he character of the dispute is distinguishable from any relief which may be sought, or granted, following an arbitration of the dispute."
73 On a fair reading the Dispute Notification, the Concise Summary, Civil Air's Outline of Submissions and Airservices' Outline of Submissions all show that the dispute before the FWC for arbitration was not relevantly broader than the Questions for Determination. But even if Airservices' contention as to the breadth of the dispute be accepted, there is nothing in the Dispute Notification (or any of the other documents referred to) to indicate that the dispute before the FWC included a claim for contravention of s 50 of the FWA, for a declaration in that regard, or for the imposition of pecuniary penalties under s 546 of the FWA.
74 As the Full Court said in Duggan (at [63]) the extent of any material which constitutes an "award" is to be determined on a case-by-case basis. The Court should examine all of the circumstances with a view to determining whether the arbitrator intended that all or some of his or her reasons form part of the award, and other documents may also be incorporated by reference. In the present case, I consider the issues decided by arbitration were the Questions for Determination and not other issues. The FWC Decision is replete with examples where it decided the dispute only by reference to the Questions for Determination: e.g. at [8]-[9] and [150].
75 The focus in TCL and in Dobbs is not on the breadth of the justiciable controversy between the parties but on the claims made and the arbitral award made to determine those claims; that is, upon the causes of action "awarded upon". In that sense Dobbs, while distinguishable from the present case, is of assistance. In Dobbs the High Court was concerned with a deed of guarantee which included a term that a certificate issued by an officer of the respondent bank stating the balance of principal and interest due from the customer was conclusive evidence of the customer's indebtedness to the bank. The Bank sued the guarantor, relying on the certificate as proof of the customer's indebtedness. The guarantor denied that the customer was indebted. In seeking to avoid the operation of the certificate, the guarantor submitted that the term was void as it attempted to oust the jurisdiction of the courts upon an issue essential to the guarantor's liability.
76 The High Court rejected the guarantor's argument and held that parties could agree that "any issue might be submitted to arbitration, and upon that issue the award would be as conclusive upon the parties as an award upon the whole cause of action if that had been submitted" (emphasis added): Dobbs at 654. The reference to that issue is significant in my view. The High Court accepted that the certificate was binding in respect of the amount of the customer's indebtedness, but that did not resolve the entire dispute. The remaining elements of the bank's cause of action fell to be determined by the Court.
77 Similarly, in the present case the questions as to whether Airservices failed to comply with cll 7.2, 8.3, 8.10 and 10.1(g) of the EA were arbitrated by the FWC and it finally and conclusively determined those issues. They were the causes of action or claims "awarded upon". The parties' rights and liabilities in relation to the remaining parts of the justiciable controversy, Civil Air's claims for declarations of contravention of s 50 and for pecuniary penalties, fall to be determined by this Court.
78 It should also be kept in mind that while the claims in the originating application are based in the same substratum of facts as the Questions for Determination arbitrated by the FWC, the originating application does not seek that the Court decide precisely the same issues. The central questions raised by the originating application are:
(a) whether it is appropriate to make declarations pursuant to s 21 of the FCA and/or s 545 of the FWA that Airservices, by contravening cll 7.2, 8.3, 8.10 and 10.1(g) of the EA, has contravened s 50 of the FWA; and/or
(b) whether it is appropriate to order pursuant to s 546(1) and (3) of the FWA that Airservices pay pecuniary penalties for those contraventions, and if so, in what quantum and whether they should be paid to Civil Air.
Those issues are related to but different to the issues decided by arbitration in which, relevantly, the FWC determined whether in the circumstances of the case Airservices had an obligation to comply with cll 7.2, 8.3, 8.10 and 10.1(g) and whether it failed to do so.
79 I do not accept Airservices' contention that to decide the originating application the Court will necessarily be required to re-decide the issues determined by the arbitral award. Civil Air does not seek that the Court enter into a consideration of, or re-decide, whether in the circumstances of the case Airservices had an obligation to comply with cll 7.2, 8.3, 8.10 and 10.1(g) of the EA and failed to do so. Nor does it seek findings inconsistent with the FWC Decision. With one exception, Civil Air accepts that those issues were finally and conclusively determined by the FWC Decision, and at the hearing of the originating application it proposes to rely on the FWC's findings as to Airservices' failures to comply with those clauses.
80 Civil Air accepts that the Court will need to be satisfied that there has been a contravention of s 50 by reason of Airservices' failure to comply with those clauses before it may make the declarations sought, but notes that the parties are bound by the FWC Decision in respect to the findings of failure to comply and Airservices is prevented from responding to the originating application in a manner inconsistent with the FWC Decision. While the Court will not be required to re-decide whether or not Airservices in fact complied with the relevant clauses, before declarations of contravention could be made Civil Air must satisfy the Court as to any remaining elements of the alleged contraventions and show that it is appropriate in the circumstances to make the declarations. Then, if the Court finds that there has been a contravention of s 50, Civil Air must satisfy the Court that in the circumstances it is appropriate to impose a pecuniary penalty.
81 The exception (noted above) concerns Civil Air's claim for declarations and the imposition of pecuniary penalties in relation to the claim that, in withdrawing the Grey Day Guidelines, Airservices had an obligation to comply with the consultation obligation in cl 7.2 of the EA and failed to do so. Civil Air submits that the FWC did not decide this issue and relies on the following statements in the FWC Decision:
(a) (at [78]) that because of the finding the FWC made that consultation was required pursuant to cl 8.3(b) "it is not necessary to determine the status of the [Grey Day Guidelines] as either a policy or procedure pertaining to employment matters"; and
(b) at [86]:
There is insufficient evidence to make a finding that the [Grey Day Guidelines] had application beyond the Byron Group and particularly to other groups in Brisbane...
On that basis it argues that there has been no arbitral decision in relation to whether, by withdrawing the Grey Day Guidelines, Airservices had an obligation to comply with cl 7.2 and failed to do so. It therefore contends that it is not seeking that the Court re-decide an issue which has been finally and conclusively determined through the FWC Decision.
82 I do not accept Civil Air's submissions in this regard. At [78] the FWC Decision said the following:
Clause 7 stipulates that "Airservices' policies and procedures pertaining to employment matters" are not part of the Agreement but that there will be consultation about changes to "such policies". The Agreement does not particularly define those things which are policies and procedures. Having regard both to the whole of the 2017-2020 Agreement, as well as the [Grey Day Guidelines], it is doubtful that the [Grey Day Guidelines) could be regarded as a policy or procedure. At best, it appears to be a local practice. However, because of the finding I make below in respect of the consultation required by clause 8.3(b) in relation to Question for Determination A2, it is not necessary to determine the status of the [Grey Day Guidelines] as either a policy or procedure pertaining to employment matters.
(Emphasis added.)
83 At [89] the FWC Decision said:
In summary, my findings in relation to the first of Civil Air's questions for determination are that the second iteration of the 2017 [Grey Day Guidelines] has application only to the Byron Group and that changes or withdrawal to it were subject to the requirement for employees to be consulted about changes to their regular roster or ordinary hours of work.
That was a finding that Airservices had an obligation to consult in relation to the Withdrawal Decision pursuant to cl 8 of the EA. The FWC did not hold that Airservices was also required to consult pursuant to cl 7.2.
84 Importantly, at [90] the FWC Decision expressly held, in answer to Questions for Determination 1 and 2 in Issue A1, that Airservices was required to comply with cll 8.3(b) and 8.10 of the EA but not cl 7. 2, and had failed to comply with cll 8.3(b) and 8.10, but not cl 7.2. Those findings are central to my view that the FWC decided the issue.
85 Further, at [95], in relation to Questions for Determination 3 and 4 in Issue A2, which concerned the related but separate issue as to whether Airservices had an obligation to consult before rolling-out Grey Days in any particular location, the FWC Decision said:
For Civil Air to succeed in respect of its contentions about clause 7.2 it would first be necessary for the Commission to accept that indeed there was a policy or procedure pertaining to employment matters proposed for development or variation on the part of Airservices Australia… The context of this particular dispute appears to be an argument that the national use of Grey Day shifts fits within such a description with the roll-out being a policy or procedure pertaining to employment matters and that the development or later variation of such a policy would require the consultation set out within clause 7. The evidence does not support that the greater use of Grey Days is such a policy or procedure. The highest that the evidence leads in this respect is a finding that the 2017- 2020 Agreement permits the use of Grey Day shifts and that Airservices Australia proposes to use such shifts when it deems it necessary or desirable. In itself, a finding of such a nature does not advance Civil Air's case. An intentional greater use of Grey Days would not likely be a "policy" within the way the word is used in Clause 7, which suggests something altogether more formal than greater utilisation of an employment practice permitted elsewhere by the Agreement. Accordingly there is no finding to be made that Airservices Australia failed to comply with the provisions of clause 7.2 in relation to the second of the Questions for Determination.
(Emphasis added.)
86 In summary, the FWC Decision said (at [78]) that it was "doubtful" that the Grey Day Guidelines were a "policy and procedure pertaining to employment matters" and they were "at best" a practice which was local to the Byron Group. It said (at [86]) that the evidence was insufficient to find that the Grey Day Guidelines had operation beyond the Byron Group. Then, the FWC expressly held (at [90]) that in withdrawing the Grey Day Guidelines Airservices did not have an obligation to comply with cl 7.2 and did not fail to comply with that clause. In relation to the related question as to whether the FWC had an obligation to consult before any national rollout of Grey Days the FWC said (at [95]) that a decision to introduce a "greater use of Grey Days" would not likely be a "policy" within the meaning of cl 7.
87 The findings (at [90]) are in conflict with the statement (at [78]) that it is unnecessary to determine whether the Grey Day Guidelines were a "policy and procedure" within cl 7 of the EA, and as a result the FWC Decision is not entirely clear. But Civil Air's case before the FWC was that the Grey Day Guidelines were a "policy and procedure pertaining to employment matters" within that clause. There could be no failure to comply with cl 7.2 unless the FWC was satisfied, on the evidence, that the Grey Day Guidelines were such a policy or procedure. On a fair reading, and giving appropriate weight to the express findings at [90], it is tolerably clear that the FWC found that Civil Air failed, on the evidence, to make good its contention that the Grey Day Guidelines were a "policy and procedure" and on that basis that Airservices did not have an obligation to comply with cl 7.2 and had not failed to comply with that clause. The FWC having finally and conclusively determined that issue, the parties' rights and liabilities in relation to that issue were extinguished. In my view Civil Air is precluded from bringing a claim for declarations of contravention and pecuniary penalties in relation to the alleged non-compliance with cl 7.2 before the Court.
88 For completeness I also note that at the conclusion of the hearing, at the Court's invitation, Civil Air indicated that it proposed to withdraw the application for declarations and pecuniary penalties in relation to the claimed failure to comply with cl 7.2. I granted leave for it to do so, and subsequently Civil Air filed an Amended Statement of Claim abandoning those claims.
89 Contrary to Airservices' submissions, the present case is not on all fours with the decisions in Energy Australia or Prados. The facts in Energy Australia are that the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) and other unions (together, the Unions) were in dispute with Energy Australia in relation to the proper construction of cl 5.3 of the Energy Australia Yallourn Enterprise Agreement 2013 (the Yallourn EA). The dispute concerned whether cl. 5.3 provided for the casual loading of 25% for a casual employee be used as the base figure for calculating overtime when overtime was performed. The AMWU filed an application with the FWC for the dispute to be dealt with in accordance with the dispute settlement procedure in the Yallourn EA. Similarly to cl 10.1(e) in the present case, the dispute resolution procedure in cl 28 of the Yallourn EA provided for escalating procedures aimed at resolution of any dispute, and if such procedures were unsuccessful it then provided for referral to the FWC for conciliation or arbitration. It provided that where the FWC made a decision following arbitration it was final and binding on the parties subject to their right to appeal.
90 Following a private arbitration, Commissioner Gregory of the FWC was not satisfied that cl 5.3 intended that casual loading was to be included in the calculation of overtime and found in favour of Energy Australia's construction of the clause. The AMWU appealed to the Full Bench of the FWC. The Full Bench found in favour of the AMWU, determining that casual employees who worked overtime were entitled pursuant to cl 5.3 to be paid double time in addition to the casual loading: Energy Australia at [39]. Subsequently Energy Australia brought an originating application in this Court seeking a declaration that on its proper construction cl 5.3 has the effect that a casual employee who works overtime "is to be paid per hour two thirty-sixths of the weekly rate prescribed for the classification of work performed (double time) exclusive of any casual loading": Energy Australia at [1].
91 The AMWU and the other unions then brought an interlocutory application under rule 13.01 of the Rules seeking an order to set aside the originating application for want of jurisdiction. The Unions contended that there was no justiciable controversy in relation to the meaning and application of cl 5.3 because, although such a dispute previously existed, it was resolved by the private arbitration by the Full Bench of the FWC, the outcome of which bound each of the parties to the proceeding.
92 Bromberg J held (at [104]-[106]) that Energy Australia and the Unions were parties to a valid arbitration by the FWC and were bound by its outcome. That led his Honour to conclude that there was an accord and satisfaction between Energy Australia and the Unions such that the arbitral award by the FWC extinguished the justiciable controversy between them, with the result that the Court did not have jurisdiction to entertain the originating application. His Honour ordered that the originating application be set aside pursuant to r 13.01 of the Rules.
93 In Energy Australia appeal the Full Court upheld Bromberg J's decision to dismiss the proceeding for want of jurisdiction. The plurality described his Honour's decision in the following terms (at [46]):
…his Honour held that the decision of the Full Bench extinguished the justiciable controversy between Energy Australia and the five unions. That was a finding on the merits that Energy Australia could not re-agitate, in any forum, the controversy that the Full Bench's decision had quelled because, it no longer existed.
(Emphasis added.)
94 Their Honours said (at [70]-[71]):
Energy Australia's submission, that it and the five unions would not be bound by any decision of the Commission in an arbitration under cl 28, and that each of it and they were free to commence proceedings in the original jurisdiction of this Court to seek declarations inconsistent with the arbitration decision, is self-evidently untenable and must be rejected. It would be recipe for industrial chaos if none of the five unions was bound by a resolution arrived at in the dispute resolution process even though cl 28 appeared, in its terms, to seek to achieve such a resolution.
The consequence of Energy Australia's argument would be that, although the Commission had resolved a dispute between it and its employees in a binding decision given under s 739(4), somehow both it and any of the five unions could evade the result of that statutorily mandated dispute resolution process. Such an absurd outcome would represent the antithesis of a dispute resolution process of the kind required by s 186(6) of the Fair Work Act. Indeed, if Energy Australia's argument were correct, then the Yallourn agreement could not comply with s 186(6) because it would not:
provide a procedure that requires or allows the [Commission], or another person who is independent of the employers, employees or employee organisations covered by [it] to settle disputes … about any matters arising under the agreement.
(Emphasis in original.)
95 Their Honours held (at [92]) that Bromberg J was correct to find that:
…the Full Bench's arbitral decision extinguished the controversy between Energy Australia, its employees and the five unions as to the dispute on the interpretation and application of cl 5.3 of the Yallourn Agreement.
96 The essential difference between the facts in Energy Australia and those in the present case is that Energy Australia's originating application sought that the Court decide precisely the same question of construction of cl 5.3 as had been finally and conclusively decided by the FWC, and it sought a declaration that was inconsistent with the arbitral award. It asked the Court to decide afresh the proper construction of cl 5.3 and to set aside the construction found by the Full Bench of the FWC as if the arbitration decision had not been made. The Court concluded that it had no jurisdiction because the controversy between the parties as to the construction of cl 5.3 had been resolved by a final and conclusive determination, and there was thus no subsisting "matter".
97 That stands in contrast to the position in the present case. Putting to one side the exception in relation to cl 7.2, Civil Air accepts that the FWC Decision finally and conclusively determined whether Airservices failed to comply with cll 8.3, 8.10 and 10.1(g) of the EA. As I have said, it accepts that those questions were finally and conclusively determined by the FWC Decision, and does not seek that the Court enter into consideration of them. Rather it says that it will rely on the FWC's findings as to Airservices' failure to comply with those clauses and that Airservices will be bound by an issue estoppel which will prevent it from responding to the application in a manner inconsistent with the FWC Decision. The present case is not one where a party dissatisfied by an arbitral determination comes before a court seeking a declaration inconsistent with the arbitral award, and it is readily distinguishable.
98 The same can be said of the decision in Prados. In that case the applicant, together with other members of Victoria Police, had sought determination of their claims for payment of a Commuted Overtime Allowance (COT) based upon the terms of the applicable enterprise agreement. After negotiations, an agreed arbitral panel, designated as the Commuted Overtime Allowance Panel (the Panel), was established. The procedure expressly agreed in relation to the conduct of the arbitral process was that the Panel's decision was final and binding and that no appeal was open from its decision. The applicant was an active participant in the private arbitration. The Panel made a determination which partially vindicated the claims of the applicants and others but the applicant was dissatisfied with that outcome. He filed an application in the Federal Circuit Court alleging that non-payment of the COT Allowance contravened the applicable enterprise agreement and the respondent had therefore contravened s 50 of the FWA.
99 The Chief Commissioner of Police submitted, in substance, that by reason of the Panel's decision there was no justiciable controversy between the parties; for that reason there was no "matter" arising under the Act; and that the court therefore had no jurisdiction. Kelly J accepted that submission and said the following (at [150]-[151], [155]):
[150] The effect of the Panel's determination was to conclusively determine that the applicant has: (1) no entitlement to a COT Allowance for the period prior to 1 July 2012; (2) an entitlement to that allowance for the period prior from 1 July 2012 until the completion of his service with the Task Force. The entitlement so established is in substitution of the asserted causes of action which were extinguished by that determination.
[151] Once the Panel had delivered its decision, this extinguished the asserted causes of action for payment of a COT Allowance under the Enterprise Agreements. Such extinguishment necessarily denies the existence of any entitlement to payment of such allowance under those agreements. From this it must follow that there is nothing upon which an alleged breach of s 50 could be grounded. As a consequence, there is no civil matter capable of attracting the operation of s 566. There is no justiciable 'matter' upon which s 566 can operate to confer jurisdiction on this court. I conclude that the court has no jurisdiction under s 566 in respect of an alleged contravention of s 50 of the Act.
…
[155] Upon the principles considered above [from TCL], the applicant's claim to a COT Allowance ceased to exist upon the Panel giving is decision. The extinguishment of that claim meant that the applicant could not thereafter assert a breach of the Enterprise Agreements in respect of his claim for that allowance. The absence of any breach of those Enterprise Agreements necessarily meant that there was no basis on which to allege a contravention of s 50 and that being so there was no civil matter arising under the Act in relation to the erstwhile claim for a COT Allowance.
(Emphasis added.)
100 Again, the present case is not one where a party dissatisfied by an arbitral determination comes before a court seeking a declaration inconsistent with the arbitral award, and it is readily distinguishable.
101 It is noteworthy that his Honour said (at [150]) that it is the "asserted causes of action" which are extinguished by an arbitral award. At [151] his Honour however said:
From this it must follow that there is nothing upon which an alleged breach of s 50 could be grounded. As a consequence, there is no civil matter capable of attracting the operation of s 566. There is no justiciable 'matter' upon which s 566 can operate to confer jurisdiction on this court.
I do not understand his Honour to say that the parties' rights and liabilities in relation to causes of action or claims which were not capable of being determined by arbitration, and were not in fact determined, are extinguished by the arbitral award. But if the decision in Prados does stand for that proposition I would respectfully disagree for the reasons previously set out.
102 Second, I do not accept Airservices' submission that having regard to the scheme of the FWA it is not open for Civil Air to:
(a) notify a dispute to the FWC regarding whether Airservices was obliged to and had failed to comply with certain clauses of the EA;
(b) obtain a decision from the FWC by arbitration that in the circumstances Airservices was obliged to comply with some of the clauses but not others, and had failed to comply with those clauses;
and then subsequently;
(c) make an application to the Court for declarations of contravention of s 50 of the FWA in relation to the failures to comply found by the FWC and for the imposition of pecuniary penalties, in reliance on the findings in the FWC Decision.
103 The statutory scheme is as follows. Part 2-4 of the FWA provides for the making of enterprise agreements. Section 185(1) requires that if an enterprise agreement is made a bargaining representative must apply to the FWC for approval of the agreement. Section 186(1) provides that the FWC must approve an enterprise agreement if the requirements set out in ss 186 and 187 are met. Section 186(6)(a)(i) provides that before approving an enterprise agreement the FWC must be satisfied that an enterprise agreement includes:
…a term that provides a procedure that requires or allows the FWC, or another person who is independent of the employers, employees or employee organisations covered by the agreement, to settle disputes…about any matters arising under the agreement.
104 It is uncontentious that cl 10.1 of the EA is a term that provides a procedure for the FWC to settle disputes about any matters arising under the EA. It empowers the FWC to conciliate and arbitrate in relation to disputes "arising under this EA or in relation to the National Employment Standards between Airservices and an employee or employees whose employment is subject to the EA." Clause 10.1(e) authorises the FWC to arbitrate the dispute and provides that if it does so the FWC it can "make a determination that is binding on the parties, subject to either party exercising a right of appeal against the decision to a Full Bench of the FWC."
105 Sections 595 in Division 3 - Subdivision B - of Part 5-1 (which concerns "Conduct of matters before the FWC") is headed "FWC's power to deal with disputes". It relevantly provides:
(1) The FWC may deal with a dispute only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.
(2) The FWC may deal with a dispute (other than by arbitration) as it considers appropriate, including in the following ways:
(a) by mediation or conciliation;
(b) by making a recommendation or expressing an opinion.
(3) The FWC may deal with a dispute by arbitration (including by making any orders it considers appropriate) only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.
(4) In dealing with a dispute, the FWC may exercise any powers it has under this Subdivision.
(5) To avoid doubt, the FWC must not exercise the power referred to in subsection (3) in relation to a matter before the FWC except as authorised by this section.
(Emphasis added.)
106 Division 2 of Part 6-2 of the FWA is headed "Dealing with disputes". It includes s 738(b) which provides that the Division applies if "an enterprise agreement includes a term that provides a procedure for dealing with disputes, including a term referred to in subsection 186(6)." Section 739(3) provides that "[i]n dealing with a dispute, the FWC must not exercise any powers limited by the term", meaning the dispute settlement procedure term in the enterprise agreement. Section 739(4) in Division 2 provides that if in accordance with such a dispute resolution term the parties have agreed that the FWC may arbitrate the dispute, it may do so. If such a dispute resolution term requires or allows the FWC to deal with a dispute arising under the enterprise agreement, and in accordance with the term, then the FWC may arbitrate the dispute on application by a party to the dispute: ss 738(b), 739(1), 739(4) and 739(6).
107 The combined effect of ss 186(6), 595, 738 and 739 of the FWA, read together with cl 10.1 of the EA, is to confer power on the FWC to deal with a dispute between Civil Air and AirServices about any matter arising under the EA by means of mediation, recommendation, conciliation or another alternative dispute resolution process conducted by agreement of the parties, or arbitration. Consistently with cl 10.1 of the EA and s 595 of the FWA, the dispute resolution powers of the FWC are confined to those conferred upon it by the FWA.
108 Chapter 4 of the FWA is titled "Compliance and Enforcement". Part 4-1 is headed "Civil Remedies". In Division 2 of that Part:
(a) Subdivision A deals with, among other matters, applications for orders in relation to contraventions of civil remedy provisions: s 539. Relevantly, Item 4 of s 539, read together with s 540, provides that an employee, an employer or an employee organisation affected by the contravention or proposed contravention of s 50 (which concerns contravention of a term of an enterprise agreement) may apply to this Court, the Federal Circuit Court or an eligible State and Territory court for an order for the imposition of a pecuniary penalty. The Act does not provide for such applications to be made to the FWC.
(b) Subdivision B sets out the orders that can be made by the Federal Court, the Federal Circuit Court or an eligible State or Territory court in relation to a contravention of a civil remedy provision. Section 545(1) provides that the Federal Court or the Federal Circuit Court may make any order the Court considers appropriate if the Court is satisfied that a person has contravened a civil remedy provision (which includes s 50). This Court may therefore make a declaration of a contravention if it considers it appropriate. As set out above, s 545(2) provides that this includes power to order injunctive relief on an interim or final basis (s 545(2)(a)); that compensation be paid for loss caused by the contravening party (s 545(2)(b)); or reinstatement of a person (s 545(2)(c)). Section 546(1) of the FWA provides that the Federal Court, the Federal Circuit Court or an eligible State or Territory court may order a person to pay a pecuniary penalty if the Court is satisfied that the person has contravened a civil remedy provision. Section 546(3)(b) and (c) provide that the court may order that any such pecuniary penalty be paid to a particular organisation or person. The Act does not so empower the FWC.
109 Part 6-1 is headed "Multiple Actions". Division 2 imposes restrictions on the FWC where alternative action can be taken. Division 3 is headed "Preventing multiple actions". Section 724 deals with multiple actions in respect of equal remuneration applications, ss 725-733 deal with multiple applications in relation to dismissals, s 734 deals with multiple actions in respect of general protections claims. Using s 727 as an example, by reference to the "general rule" in s 725, it relevantly provides that a person who has elected to have the FWC arbitrate a general protections application cannot make an application to a court in relation to the same matter. As a result the court could not impose a civil penalty where the FWC had determined a general protections claim by arbitration. I accept that these provisions deal with different issues to the dispute resolution powers of the FWC that may, or may not, involve issues of non-compliance with an enterprise agreement and the enforcement mechanisms that the Court puts in place. Even so they tend to show that where the legislature intended to require a person seeking a remedy under the FWA to make an election between different processes the Act expressly provides for that choice.
110 Parts 2-4, 4-1, and 6-2 of the FWA must be read together, and harmoniously. Taken together, they show a statutory scheme that provides both for the resolution of disputes between parties in relation to matters arising under an enterprise agreement by conciliation, mediation, recommendation and by arbitration by third party arbitrators (including the FWC), and also for the determination and enforcement of the parties' rights and liabilities by the courts. The scheme recognises and gives effect to the distinction between the exercise of arbitral functions and the exercise of judicial power. There is nothing in the FWA which expressly provides, or otherwise shows, that when dealing with a dispute the FWC must be dealing with the entirety of the justiciable controversy between the parties. In my view the statutory scheme allows for the entirety of a dispute to be determined through the dispute settlement procedure in an enterprise agreement, or only part of it. The extent of what is determined may depend upon matters including the nature of the dispute, what is referred for arbitration, and the nature of the claims as there may be some claims that the FWC or another arbitrator is not empowered to determine. Where particular causes of action or claims are made by a party (such as, for example, claims for compensation under s 545 or for the imposition of a pecuniary penalty under s 546), those parts of the dispute can only be determined by a court of competent jurisdiction. In my view the statutory scheme recognises that such parts of a dispute will not be determined by the FWC.
111 On Airservices' argument, where a party to an enterprise agreement notifies a dispute regarding an alleged breach of a term of the agreement to the FWC and the dispute is determined by arbitration, it is impermissible for employees, employee organisations or employers affected by the alleged breach to apply to the courts seeking compensation under s 545 or for the imposition of a pecuniary penalty under s 546 of the FWA. Had Parliament intended to restrict the right or entitlement of such persons to assert their statutory entitlements only to those who had not earlier been party to a dispute resolution procedure before the FWC (as provided by an enterprise agreement) or to deprive the courts of jurisdiction to order pecuniary penalties or compensation where an arbitral award as to non-compliance with the enterprise agreement has been made, it would have done so expressly and in clear terms. There is little in the text, context and purpose of the FWA to show that the statutory scheme operates in the way Airservices' contends.
112 It is necessary also to understand that the corollary of Airservices' argument is that where one party to the EA notifies a dispute to the FWC which includes a claim alleging breach of a term of the EA and it is determined by the FWC, the other party (who did not notify the dispute) would lose its right or entitlement to seek compensation for losses suffered through any breach under s 545 and the imposition of a pecuniary penalty under s 546 through the courts. That is so because cl 10.1(e), like many dispute settlement terms, empowers the FWC to arbitrate the dispute if it is not resolved by conciliation. On Airservices' argument determination of the dispute will extinguish all the parties' rights and liabilities in relation to the entire justiciable controversy, even those parts which the FWC had no power to determine such as any entitlement to compensation or a pecuniary penalty. That would be an absurd result, and it would be likely to incentivise the party that breaches the EA to notify a dispute to the FWC so as to avoid the risk of an order for a pecuniary penalty or compensation by a court. That also points away from construing the statutory scheme in the way Airservices contends.
113 Airservices' contentions regarding the statutory scheme also sit poorly with the public policy purpose inherent in the regime under Part 4-1, particularly the promotion of the public interest in compliance with the terms of enterprise agreements that is evident in the availability of pecuniary penalties and compensation for contraventions and the importance attached to specific and general deterrence: see Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate; Construction, Forestry, Mining and Energy Union v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; (2015) 258 CLR 482 at [55] (French CJ, Kiefel, Bell, Nettle and Gordon JJ). Nor do they sit well with the object in s 3(e) of the FWA of "providing accessible and effective procedures to resolve grievances and disputes and providing effective compliance mechanisms". Those compliance mechanisms include the power of the courts to make declarations of contravention, impose pecuniary penalties or order compensation.
114 I do not accept Airservices' contention that if Parliament had intended that following resolution of an industrial dispute by arbitration it was open to a party to the dispute to then re-agitate part of it in the courts it would have said so expressly, including by putting in place mechanisms for preventing the abuse of such a process including the application of the rules of evidence. More particularly, I do not accept that absent such express words a contrary intention is to be inferred.
115 First, it is inappropriate for Airservices to characterise the present application as amounting to re-agitation when Civil Air does not seek that the Court construe the relevant clauses of the EA or venture into whether or not Airservices failed to comply with those clauses, and accepts that those questions have been finally and conclusively decided by the FWC; instead it seeks to rely upon the FWC Decision in that regard. Nor is it apt to say that Airservices faces 'double jeopardy' when: (a) no relief was imposed against Airservices for the failures to comply which were found by the FWC; and (b) the claims which Civil Air now seeks be decided by the Court involve some different questions that were not before, and could not have been put before, the FWC.
116 Second, the parties agreed on the dispute resolution procedure in cl 10.1 of the EA and it was open to them to select an independent person other than the FWC to settle any disputes that arose, and to agree upon the processes that would be used in any arbitration. The parties chose the FWC and must have known that the FWC could inform itself in such manner as it considers appropriate (s 590(1)), and was not required to follow the rules of evidence and procedure (s 591). It is appropriate to infer that the parties understood and were content with the manner in which any dispute that arose would be determined by the FWC, and content that any finding would be final and binding subject to their right to appeal to the Full Bench.
117 Further, to the extent that by this contention Airservices seeks to insinuate that the FWC's processes in the present case were somehow deficient, or that it did not receive procedural fairness, that must also be rejected. The Questions for Determination by the FWC were identified with precision, both parties were legally represented including by senior and junior counsel, evidence was adduced by way of witness statements provided in advance of the hearing and the witnesses were available for cross-examination. The FWC provided comprehensive reasons, and neither party appealed the result. In my view the parties enjoyed an abundance of procedural fairness.
118 For these reasons I consider there remains a subsisting justiciable controversy between the parties, and there remains a "matter" arising under s 562 of the FWA. In my view the Court has jurisdiction to hear the originating application.