Director of the Fair Work Building Industry Inspectorate v Cartledge

IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION SAD 57 of 2014

BETWEEN: DIRECTOR OF THE FAIR WORK BUILDING INDUSTRY INSPECTORATE

JUDGE: MANSFIELD J DATE OF ORDER: 14 AUGUST 2015 WHERE MADE: ADELAIDE

1. The Second Respondent, Jim O'Connor, pay a monetary penalty for being in contempt of an order of this Court in the sum of $12,000.
2. The Second Respondent, Jim O'Connor, pay the Applicant's costs, reasonably incurred, of the interlocutory application dated 3 September 2014 on a solicitor own client basis. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION SAD 57 of 2014

BETWEEN: DIRECTOR OF THE FAIR WORK BUILDING INDUSTRY INSPECTORATE

JUDGE: MANSFIELD J DATE: 14 AUGUST 2015 PLACE: ADELAIDE

Introduction 1 This is an interlocutory application by the applicant, the Director of the Fair Work Building Industry Inspectorate, for an order that: A monetary penalty be imposed on Jim O'Connor for being in contempt of his Honour Justice Mansfield on 25 March 2014 by reason of his conduct on 13 May 2014 at the site of the project for the construction of the new Royal Adelaide Hospital at Port Road, Adelaide (the new RAH project) on which Hansen Yuncken Pty Ltd is engaged as a head contractor. 2 Order 8 of the orders made on 25 March 2014 ('the injunction') stated: Until further order, each of the first respondent, the second respondent, the third respondent, the fourth respondent, the fifth respondent, and any other organiser of the sixth respondent employed in its Construction and General Division, South Australian Divisional Branch, be restrained from attending the Hansen Yuncken Pty Ltd (Hansen Yuncken) project at 50 Flinders Street, Adelaide, or the project for the construction of the new Royal Adelaide Hospital in which Hansen Yuncken is engaged as a head contractor, unless they are lawfully exercising or seeking to exercise rights in accordance with Part 3-4 of the Fair Work Act 2009 (Cth). 3 On 13 May 2015, the Court found that the second respondent, Mr O'Connor, by reason of his conduct at the new Royal Adelaide Hospital (RAH) on 13 May 2014, had acted in contempt of the Court by not complying with that order as he was not attending the site of the RAH project and lawfully exercising or seeking to exercise his rights in accordance with Pt 3-4 of the Fair Work Act 2009 (Cth) (FW Act). The context of this interlocutory application and the reasons for that decision are outlined in Director of the Fair Work Building Industry Inspectorate v Cartledge [2015] FCA 453 (the Contempt Decision). The circumstances of this conduct are discussed in more detail below. 4 This matter was then adjourned for hearing on the appropriate final orders which should be made in light of those findings. These reasons concern why those orders are now made.

CONSIDERATION 5 There is no issue about the Court's power to punish a contempt of Court under s 31(1) of the Federal Court of Australia Act 1976 (Cth) which reflects the High Court of Australia's power under s 24 of the Judiciary Act 1903 (Cth). This includes the power to order the contemnor to pay a fine: r 11.04.1(a) of the High Court Rules 2004 (Cth). 6 The relevant considerations to the determination of an appropriate penalty for contempt of Court were identified at [6] in Bovis Lend Lease Pty Ltd v Construction Forestry Mining and Energy Union (No. 2) [2009] FCA 650 (Bovis) citing Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98, Construction, Forestry, Mining and Energy Union v BHP Steel (AIS) Pty Ltd (2003) 196 ALR 350, and Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494 at 501-502, they are: the contemnor's personal circumstances; the nature and circumstances of the contempt; the effect of the contempt on the administration of justice; the contemnor's culpability; the need to deter the contemnor and others from repeating contempt; the absence or presence of a prior conviction for contempt; the contemnor's financial means; and whether the contemnor has exhibited general contrition and made a full and ample apology. 7 The application of each of these factors to the present circumstances is discussed below.

The nature and circumstances of the contempt 8 The circumstances and facts surrounding the contempt which should be given the most weight are not agreed between the parties. Mr O'Connor submits that the relevant circumstances of the contempt are the findings outlined in the Contempt Decision only. The Director submits that the nature and relevant circumstances of the contempt should not be confined in this way, and instead that they should extend to the proceedings in which the injunction was granted and the findings in relation to that matter.

The principal claim 9 As outlined in the Contravention Decision at [2], the contempt application was issued in proceedings then on foot in the Court alleging that the Construction, Forestry, Mining and Energy Union (CFMEU), an organisation of employees registered under the Fair Work (Registered Organisations) Act 2009 (Cth) and five of its officers, including Mr O'Connor, variously contravened s 500 of the FW Act on 19 and 20 March 2014 at a construction project in Adelaide known as the "50 Flinders Street" project (the principal claim). The second respondent, Mr O'Connor, is the person named in the contempt summons. The facts concerning the alleged contraventions in the principal claim were agreed without a hearing, and on 2 October 2014 judgment was given making declaratory and other orders, including the imposition of pecuniary penalties, on each of the CFMEU and its five officials in respect of the contravening conduct as found: Director of the Fair Work Building Industry Inspectorate v Cartledge [2014] FCA 1047 (the Principal Decision). 10 In the Principal Decision it was found that Mr O'Connor contravened s 500 of the FW Act on two separate occasions. The first occasion was on 19 March 2014. On that date it was found that Mr O'Connor entered the 50 Flinders Street project without providing an entry notice as required by s 487 of the FW Act. The second occasion was on 20 March 2014. On that date, Mr O'Connor sought to enter the 50 Flinders Street project with another union official, Mr Pitt. Mr O'Connor approached a site manager, Mr Nuzzo, and became involved in a physical altercation forcibly pulling Mr Nuzzo away from the Access Gate. He then entered the 50 Flinders Street project without providing an entry notice as required by s 487 of the FW Act. Orders 3(b) and 3(c) of the orders made on 2 October 2014 required Mr O'Connor to pay pecuniary penalties for each contravention in the amount of $1500 and $4500, respectively. 11 It was in the context of the Union allegations in the principal claim (subsequently found to have been proved as recorded in the Principal Decision) that on 25 March 2014 an interim injunction, in substantially the same terms as the injunction, was granted and that on 2 October 2014 the injunction was granted. The injunction, and the conduct constituting the contempt, took place before the Principal Decision.

The contempt 12 Hansen Yuncken Pty Ltd in a joint venture with Leighton Contractors Pty Ltd was the head contractor for the project for the construction of the new Royal Adelaide Hospital (RAH) project. Bleasdale National Contractors - South Australia (BNC) was engaged as a subcontractor to perform work on and in connection with the new RAH project. In about early May 2014, Mr O'Connor, in his capacity as an official of the CFMEU, requested a meeting with Nicholas Bleasdale, the Manager of BNC, with a view to asking Mr Bleasdale to employ a member of the CFMEU executive, Jason Clark. 13 It is clear that Mr O'Connor was, by the injunction, clearly informed that he should not attend, that is be present at, the site unless he was there lawfully exercising or seeking to exercise his lawful entry rights: the Contempt Decision at [55]. 14 On 9 May 2014, Mr O'Connor gave notice to Hansen Yuncken that, pursuant to his permit, he would enter the new RAH project on 13 May 2014 for the purpose of holding discussions with employees pursuant to s 484 of the FW Act. Pursuant to that notice he attended the RAH project at about 6.15 am on 13 May 2015. At about 12.15 pm he spoke to Mr Bleasdale about several matters, including the request that Mr Bleasdale find a job for Mr Clarke, and said words to the effect of: "You don't want to go to war with us. You know how it works, Nicko". As the Contempt Decision records, these words constituted a threat by Mr O'Connor to Mr Bleasdale to engage in industrial activity if Mr Bleasdale did not find a job for Mr O'Connor. This threat was unlawful by reason of s 348 of the FW Act, which provides that a person must not threaten or organise to take any action against another person with intent to coerce the other person to engage in industrial activity. Consequently, it was found that Mr O'Connor was acting in contempt of the injunction. 15 The Director submits that the contraventions of the FW Act that are the subject of the Primary Decision, demonstrate a firm and significant disregard for the entry provision. The Court found that he "simply did not care about complying with the entry provisions" and "chose deliberately not to comply with them" which was a flagrant abuse of Mr O'Connor's rights and responsibilities and that Mr O'Connor failed to express contrition for these acts: see the Principal Decision at [64], [71], [92] and [96]. 16 The Director further submits that the contempt is egregious because: (a) Mr O'Connor was clearly informed of the injunction, its operation and the time, and therefore, that the contempt was knowing and wilful; (b) the contempt constitutes part of a pattern of conduct by Mr O'Connor involving a flagrant disregard for his legal obligations at the Project and the RAH site; (c) the threat to engage in industrial activity if a member of the CFMEU Executive was not found a job, so it was not motivated by concern for the industrial interests of ordinary CFMEU members or other employees at the RAH site; (d) Mr Bleasdale was sufficiently concerned about Mr O'Connor's threat to speak to his father about it, make a record of it, react to Mr O'Connor shortly afterwards in an uncommunicative and unresponsive way and to make a complaint about it to Hansen Yuncken; and (e) the fact that Mr Bleasdale sustained no loss or damage as a result of Mr O'Connor's contempt is not a factor that weighs significantly in his favour in the determination of a penalty: Bovis at [16]-[17]. 17 Mr O'Connor submits it is significant that he gave proper notice of his intention to enter the RAH site on 13 May 2014 for the lawful and legitimate purpose of conferring with the workers on the site about matters that were relevant to his role as an organiser for the CFMEU and that he did not enter the site for the purpose of, or with the intent to, breach the injunction. He further submits that the context of the threat was that he was enquiring about the welfare of Mr Clarke, who was then unemployed, and whether Mr Bleasdale had been able to find a job for him. 18 I proceed on the basis that there is a relevant difference between the circumstances (alleged, and then proved) in which the contraventions of the FW Act by Mr O'Connor occurred as found in the Principal Decision and the conduct constituting the contempt. Clearly, on the occasion of the contempt, he followed the entry procedures required (unlike the conduct constituting the contraventions). I also accept that participating in a conversation with Mr Bleasdale in which he sought a job for Mr Clarke, was not outside the legitimate activities he could pursue whilst he was at the RAH site on 13 May 2014. 19 The contempt occurred by the way in which he pursued Mr Clarke's interests: see the Contempt Decision at [161]-[170] and [172]. I do not, therefore, consider the contempt is part of a pattern of behaviour reflecting a flagrant disregard of his legal obligations at the RAH site. Nor do I take into account, adversely to Mr O'Connor, that he was pursuing the particular interests of Mr Clarke at the time, rather than the more generic interests of employees at that site. 20 However, the threat was made. It was a voluntarily and deliberate statement. I will not repeat the findings in the Contempt Decision referred to in the preceding paragraph. There is no evidence providing an explanation for why it was made. Counsel for Mr O'Connor submitted that the threat was just "blurted out" and was a "spur of the moment" thing at the lower end of the scale. But Mr O'Connor has not provided any evidence of that, and I do not draw from the sequence of the conversation or the topics addressed or the relatively brief time this part of the conversation occupied that the threat was not intentionally made to emphasise the desirability of Mr Clarke being found a job. I do not draw from the evidence that Mr O'Connor made the threat in a flat and non-emotive tone, or that the threat was not intended to be made. Nor do I draw such a conclusion from the evidence that the meeting itself ended on an apparently amicable way. It had a real effect upon Mr Bleasdale: see the Contempt Decision at [143]. There is, moreover, no evidence that Mr O'Connor did not intend that the threat he had made should have no real menace, either because he did not intend to give effect to it or for any other reason. 21 I am, however, prepared to proceed on the basis that Mr O'Connor, when he made the threat, did not at that precise time consciously and explicitly decide to do so realising it was a breach of the injunction. It is accepted that he made the threat voluntarily and deliberately. With a moment's focus, making that threat would have been identified as a breach of the injunction. But the period of time that Mr O'Connor had been at the RAH site on that day, the earlier brief conversation with Mr Bleasdale which he observed, and the fact that the threat appears to have been made only as a close to final step in the process of trying to secure a job for Mr Clarke does not lead me to conclude that Mr O'Connor made the threat consciously thinking at that time that he was doing so an breach of the injunction. On the other hand, his conduct was not inadvertent or involuntary, so he is accountable for that conduct as a contempt: Australian Competition and Consumer Commission v INFO4PC.com Pty Ltd (2002) 121 FCR 24 at [10]. 22 It follows that I accept the Director's contention that Mr O'Connor's conduct was undertaken either by being careless or unreasonably indifferent to his obligations to comply with the injunction, or did not diligently attempt to comply with it in the course of the conversation with Mr Bleasdale: cf Construction Forestry Mining and Energy Union v BHP Steel (AIS) Pty Ltd (2003) 196 ALR 350 at [39].

Mr O'Connor's personal circumstances 23 I accept what was advanced about Mr O'Connor's personal circumstances: his training and experience, his long and good work record, his level of earnings; and his family commitments. I accept that this finding, and the penalty to be imposed, will impact significantly upon him. I accept that his family has been affected by this finding and by the finding about his contraventions of the FW Act recorded in the Principal Decision. 24 I note that his right of entry was suspended on 4 May 2015 for six months, and expires (so that he must apply for it to be renewed) on 13 May 2016. That suspension was not promoted by the Contempt Decision, as it preceded that decision. Nevertheless, I accept that to some degree it puts Mr O'Connor's present employment into some uncertainty as an entry permit and the activities it enables are important elements of his present employment.

Other factors 25 It is necessary to impose a penalty which recognises and gives effect to the need for both specific and general deterrence: Bovis at [38]-[40]. Mr O'Connor will be able to use his entry permit again from 4 November 2015. 26 Having regard to the character of Mr O'Connor's contraventions of the FW Act as found in the Principal Decision, and the fact that at the time of the contempt those findings had not been made, I do not take into account adversely to Mr O'Connor any attitude he may have (or is said to have) to compliance with the legal obligations under the FW Act. 27 On the other hand, there is no basis for that discounting that which would otherwise be an appropriate penalty for any expression of penitence or for any prompt acknowledgement of the contempt, although there is no additional adverse weighting because Mr O'Connor chose to contest the contempt charge. Nor is there reason to alter the appropriate penalty because of the position he occupies in the Union.

conclusion 28 Having regard to the matters to which submissions were directed, and in the light of the consideration of particular aspects as noted above, in my view the appropriate penalty for the contempt is a fine of $12,000.

costs 29 The Director also seeks costs of the interlocutory application of 3 September 2014 for an order that Mr O'Connor be punished for contempt. That is resisted first because, it is said, s 570(2) of the FW Act applies so that no such order as to costs can be made, and alternatively, because the proper exercise of any discretion would lead to there being no order as to costs. 30 Section 570 of the FW Act provides: (1) A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A. Note: The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 569A. (2) The party may be ordered to pay the costs only if: (a) the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or (b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs; or (c) the court is satisfied of both of the following: (i) the party unreasonably refused to participate in a matter before the FWC; (ii) the matter arose from the same facts as the proceedings. 31 I accept the contentions of the Director that the application for a monetary penalty for contempt of the injunction is not a proceeding "in relation to a matter arising under" the FW Act. The principal claim had that character, including the application for the injunction itself. It was to get an interlocutory order to prevent or stop the effects of possible or potential contraventions of s 500 of the FW Act in the light of the conduct alleged (and subsequently proven) in the principal claim. 32 Although, procedurally, the application for a monetary penalty for contempt was brought within the principal claim, it is of an entirely different character. It invokes the jurisdiction of the Court under Pt III of the Federal Court of Australia Act 1976 (Cth) to enforce an order of the Court. It does not enliven or assert a claim in relation to a matter arising under the FW Act. Rather, it is to vindicate the authority of the Court and the public interest in the due administration of justice: Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 112-113. It is not a claim under or related to a claim under the FW Act, so as to fall within the "matter" which is the principal claim: cf Stanley v Service to Youth Council Inc (No 3) (2014) 225 FCR 357 at [28] (Stanley). 33 It is necessary to say a little more about that conclusion, and about the decision of Stanley. That decision helpfully refers to the legislative history of s 570 and its ancestors, and to the Second Reading Speeches concerning the significant changes to that section and its ancestors. I shall not repeat that, and I gratefully adopt it. 34 In Stanley, the issue was whether s 570 applied where the claims under consideration were made under the FW Act and under the Sex Discrimination Act 1984 (Cth). The conventional starting point taken by White J was to accept that the "matter" included all claims before the Court: Fencott v Muller (1983) 154 CLR 570; Re Wakim; Ex parte McNally (1999) 198 CLR 511. Then White J took the appropriate steps of considering whether the current wording of s 570 dictated any different result. His Honour considered that it did not do so. That conclusion is, of course, consistent with the decision of the Full Court in Commonwealth of Australia v Construction, Forestry, Mining and Energy Union (2003) 129 FCR 271, concerning s 347 of the Workplace Relations Act 1996 (Cth) (WR Act). There it was held that s 347 of that Act applied to the interlocutory disputes within the "matter" or controversy between the parties. 35 In this instance, the procedural path for the interlocutory application is r 42.11(1) of the Federal Court Rules 2011 (Cth) as the contempt clearly was committed in connection with a proceeding in the Court. Otherwise it would require a separate originating proceeding: r 42.11(2). 36 As I have indicated, in my view, this is a different "matter" from the issues or controversy which the principal claim concerned. 37 It remains to considers whether it is "in relation to a matter arising under the FW Act". That is an issue upon which, as presently advised, there is no directly applicable earlier decision of the Court. 38 In Shackley v Australian Croatian Club Ltd (1996) 141 ALR 736, when considering s 347 of the WR Act, the Full Court of the Industrial Relations Court addressed a similar question, and in essence in the sequence and upon the basis discussed above: see especially per Wilcox CJ (with whom von Doussa J agreed) at 745-746. The significant point of difference is, as counsel pointed out, the addition of the words "in relation to". 39 However, these words concern the "matter", and it is necessary therefore to apply them to the present proceeding and the controversy it addresses. In my view, that is not a matter arising under the FW Act. It is correct that the conduct contravening the injunction is conduct which is (or may have been) in contravention of s 348 or 500 of the FW Act. It is also correct that it was because of (then alleged) conduct in contravention of the FW Act that the injunction was granted. 40 The ultimate step is that the matter addressed by the Contempt Decision is not a matter arising under the FW Act, notwithstanding the introduction of the expanding words "in relation to" as discussed by White J in Stanley at [23]-[27]. 41 It is not therefore necessary to address the criteria in s 570(2). The Director relied on National Australia Bank v Juric (No 2) [2001] VSC 398 at [67]-[70] for the normal rule that in contempt cases, a litigant who must come to court to enforce an order which has been breached by contempt, should not be out of pocket. In that case, the Court ordered costs to be paid on a solicitor and own client basis. The fact that Mr O'Connor may have acted reasonably (as many litigants do) in his opposition to the application is not itself a reason to depart from such an order. It was his conduct which prompted the application. I see no reason why the Director should not recover costs of the application. It is an application to enforce an order of the Court. It is therefore also appropriate that he pay the Director's costs of the application on solicitor client basis, with the usual constraint limiting these recoverable costs to costs reasonable incurred. 42 There will be orders accordingly. I certify that the preceding forty-two (42) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Mansfield.