George Murrell v South Eastern Sydney Area Health Service

Unfair Contract - Interlocutory proceedings - Notice of Motion - Whether strikeout motion in reliance on s108A of the Industrial Relations Act 1996 should be heard as a preliminary issue - Whether complex question of fact and novel legal issues precluded hearing of strike out motion prior to substantive proceedings - Principles relating to threshold challenges to jurisdiction - Different issues to be determined in strike out motion from those in substantive proceedings - Whether opening words of s 108A compel early consideration of strike out application - Application by applicant to defer consideration of strike out motion until substantive hearing refused - Costs reserved. CATCHWORDS: Practice and procedure - Interlocutory proceedings - Notice of Motion - Whether strikeout motion in reliance on s108A of the Industrial Relations Act 1996 should be heard as a preliminary issue - Whether complex question of fact and novel legal issues precluded hearing of strike out motion prior to substantive proceedings - Principles relating to threshold challenges to jurisdiction - Different issues to be determined in strike out motion from those in substantive proceedings - Whether opening words of s 108A compel early consideration of strike out application - Application by applicant to defer consideration of strike out motion until substantive hearing refused - Costs reserved.

LEGISLATION CITED: Industrial Relations Act 1996

Aveling v UBS Capital Markets Australia Holdings Ltd (2004) 135 IR 98 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 Euphoric Pty Limited v Ryledar Pty Limited and Anor (2002) 117 IR 1 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Lahoud v Lahoud (2003) 127 IR 243 Majik Markets Pty Ltd v Brake and Service Centre Drummoyne Pty Ltd (1991) 28 NSWLR 443 CASES CITED: Nagle (T/as W D and J L Nagle & Sons) v Tilburg (1993) 51 IR 8 NRMA Insurance Ltd v A W Edwards Pty Ltd (NSWCA, 11 November 1994). Preston v Star City Pty Ltd [1999] NSWSC 1273 Virtue v NSW Department of Education and Training (1999) 92 IR 428 Williams & Humbert v W & H Trade Marks (Jersey) Ltd [1986] 1 AC 368

APPLICANT Mr J L Trew QC with Mr S A Wells of counsel Solicitor: Mr P Knudsen The Hargreaves Practice LEGAL REPRESENTATIVES:

RESPONDENT Mr R F Crow of counsel Solicitor: Mr M Paul

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: BOLAND J Friday 4 February 2005

Matter No IRC 906 of 2003 MURRELL v SOUTH SYDNEY AREA HEALTH SERVICE

Application under section 106 of Industrial Relations Act 1996

Matter No IRC 5562 of 2004 MURRELL v SOUTH SYDNEY AREA HEALTH SERVICE

Application under section 106 of Industrial Relations Act 1996

1 George Anthony Calvert Murrell, Associate Professor of Medicine, is employed by the South Eastern Sydney Area Health Service ("the respondent") as the director of the Department of Orthopaedic Surgery at St George Hospital and director of the Orthopaedic Research Institute associated with St George Hospital. In February 2003 Dr Murrell filed a summons for relief under s 106 of the Industrial Relations Act 1996 seeking certain orders varying his contract of employment and certain ancillary orders.

2 For the purpose of these interlocutory proceedings the background to the summons may be stated reasonably briefly. In 1992, in response to an advertisement, Dr Murrell applied to St George Hospital for appointment as the Conjoint Professor/Associate Professor of Orthopaedics. Following a series of interviews, the applicant entered into a contract of employment in or about August 1995. A dispute arose out of the respondent's decision to terminate this contract. The dispute was settled and led to an agreement between the applicant and the respondent dated 4 August 1997. The agreement, which was titled "Contract of Employment" "South Eastern Sydney Area Health Service and Dr George Anthony Calvert Murrell", provided, inter alia, that: 2.2 Dr Murrell is employed with all the rights and privileges and obligations of a Professor. This Agreement will continue, subject to the termination provisions of the Agreement, until the earlier of: (a) such time as Dr Murrell is employed by the University of new South Wales as Professor of orthopaedic Surgery; or (b) 1 September 2002. … 3.4 SESAHS, in consultation with the University of New South Wales, will create and continue to fund the position of Professor of Orthopaedic Surgery, such position to be commensurate in status and remuneration to other full professorial positions within the Faculty of Medicine of the University of New South Wales. 3.5 The SESAHS will use its best endeavours to secure Dr Murrell an appointment to this position as soon as practicable.

3 The summons then states: When the agreement of 4 August 1997 was reached between the parties, it was the Applicant's best expectation based upon what had been said to him, that the agreement would be replaced because soon thereafter and certainly well before 1 September 2002, the Applicant would have been employed by the University of New South Wales as Professor of Orthopaedic Surgery. Despite that expectation and reliance upon what had been said to him, the Applicant still has not been appointed as the Professor of Orthopaedic Surgery.

4 It appears the respondent took the view that the 1997 contract of employment with the applicant expired on 1 September 2002 and the applicant was advised that it was the respondent's intention to pay the applicant as a Level 1 Staff Specialist in accordance with the applicable award from 1 January 2003. It was alleged in the summons this would have amounted to a significant decline in the applicant's remuneration and "may have had a significant effect on his professional responsibilities and duties".

5 The summons contended: It is unfair conduct on behalf of the Respondent not to have expeditiously arrived at the matter contained in clause 3 of the agreement and it is further unfair to revert the Applicant to a lower position and lower pay scale on account of its failure to expeditiously pursue the matters referred to in clause 3 of the agreement. The actions of the Respondent are without the consent of the Applicant and the agreement of August 1997 ought fairly continue in its terms and conditions until it is properly replaced by the consent of the parties.

6 Discussions between the parties continued, with the applicant seeking to have the decision to place him under an award deferred until agreement could be reached on a new contract to replace the 1997 agreement. In February 2003, however, the applicant received a letter from the respondent the effect of which he complained was to negate an earlier in-principle agreement the parties had apparently reached to resolve the matter and to diminish the terms and conditions of the applicant's employment.

7 On 26 July 2004 the applicant filed an amended summons for relief that contended: On or about the 30 September 2003 the Respondent unilaterally and without the consent of the Applicant terminated the Applicant's employment contract and placed the Applicant under the terms and conditions of the Senior Medical Practitioners (State) Award.

In or about May 2004 the Respondent commenced to conduct a "review" of the space occupied by the Applicant in the ORI building with a view to terminating the right of the Applicant to use the said space in breach of previous agreements between the parties.

Further, in or about May 2004 the Respondent instructed a private investigator to interview various personal staff members of the Applicant about matters concerning the space which the Applicant occupies in the ORI. This took place without the consent of the Applicant.

8 On 12 August 2004 the respondent filed a notice of motion seeking: 1 An order that the application by George Anthony Calvert Murrell made 21 February 2003, as amended on 26 July 2004 and contained in proceedings number IRC 906 of 2003 cannot be made.

2 An order that proceedings number IRC 906 of 2003 be struck out.

3 An order that the applicant in those proceedings pay the respondent's costs of those proceedings and the applicant's costs of this notice of motion.

9 On 15 September 2004 the applicant filed a further summons for relief (matter No IRC 5562 of 2004). In the summary of matters of fact and law the applicant stated: 1 On or about 4 August 1997 the Applicant entered into a contract of employment with the Respondent. Inter alia, the contract provided for the payment of a salary of $173,269, appointment to directorships, establishment of and funding of an Orthopaedic Research Institute.

2 The Applicant repeats the paragraphs found in Part B of the Applicant's Amended Summons filed 26 July 2004 IRC 906 of 2003.

3 On or about 30 September 2003 the Respondent, without the consent of the Applicant, ceased paying the Applicant the salary as agreed under the said contract of employment. The Respondent reduced the applicant's remuneration to $147,788. 4 The Applicant claims that the arrangement under which the respondent pays the applicant's remuneration is unfair within the meaning of s 105 of the Industrial Relations Act 1996.

10 The applicant subsequently moved the Court to join matter Nos IRC 906 of 2003 and 5562 of 2004 and that was done on 14 December 2004. On that date the Court also heard an application by the applicant that the respondent's strike out motion in matter No IRC 906 of 2003 not be heard independently of the substantive proceedings. That strike out motion relied on the proposition that the applicant's remuneration exceeded the cap of $200,000 as provided by s 108A of the Act and that consequently the applicant could not make the application in matter No IRC 906 of 2003.

11 Accordingly, the matter to be determined in these interlocutory proceedings is whether the respondent's strike out application should be adjourned and dealt with in the course of the substantive proceedings.

12 Section 108A of the Act is in the following terms: 108A Employment contracts in respect of which applications cannot be made (1) An application cannot be made for an order under this Division if the application relates to a contract of employment under which: (a) a remuneration package that exceeds the remuneration cap is paid or received (or is payable or receivable) during the period of 12 months immediately before the application is made (or, if the application concerned relates to a contract that has been terminated, immediately before the termination), or (b) a remuneration package is paid or received (or is payable or receivable) during a period of less than 12 months immediately before the application is made (or, if the application concerned relates to a contract that has been terminated, immediately before the termination) that would, if the remuneration package had been paid or received (or been payable or receivable) for a period of 12 months, have exceeded the remuneration cap. (2) An application cannot be made for an order under this Division by a person who is a partner carrying on a business if: (a) the application relates to a contract between that partner and the other persons carrying on that business in partnership, and (b) the share of the net profits, or payments contingent on the net profits, of the business that are paid to or received by (or payable to or receivable by) the applicant during the period of 12 months immediately before the application is made (or, if the application relates to a contract that has been terminated, immediately before the termination) exceed: (i) $200,000, or (ii) if an amount is prescribed for the purposes of paragraph (b) of the definition of "remuneration cap" in subsection (3) - that amount. (3) In this section: contract of employment means any contract or arrangement under which work is done by a person in the capacity of an employee, and includes a related condition or collateral arrangement with respect to such a contract. employment benefit means a benefit provided to an employee at the cost of his or her employer (being a benefit of a private nature) and, without limitation, includes: (a) contributions payable to a superannuation scheme by an employer in respect of the employee, including any liability of that employer to make any such contributions or to pay costs associated with that scheme, or (b) the provision by an employer of a motor vehicle for private use by the employee, or (c) any other benefit prescribed by the regulations for the purposes of this definition. monetary remuneration includes any performance-related bonus or incentive payment. remuneration cap means: (a) $200,000, except as provided by paragraph (b), or (b) any greater amount prescribed by the regulations (being a regulation that increases the amount by reference to increases in the amount referred to in section 83 (1) (b)). remuneration package means the total value of monetary remuneration and employment benefits payable or receivable under a contract of employment.

13 Mr J Trew QC with Mr S Wells of counsel appeared for the applicant. Mr Trew indicated there were two bases upon which the hearing of the strike out application should be deferred to the substantive hearing: 1 Hearing of the application separately lacked utility as matter No 906 of 2003 had been joined with matter No IRC 5562 of 2004; the respondent in respect of the second matter had filed no strike out application; 2 The strike out application involved the determination of complex questions of law and fact.

14 In respect of the first point the applicant submitted that in relation to the summons in matter No IRC 5562 of 2004 there was no question that his remuneration was less than the cap prescribed by s 108A following the reduction in the applicant's remuneration to what he claimed was $147,788. That being the case and given that the proceedings had been consolidated by the joinder of matter Nos IRC 906 of 2003 and 5562 of 2004 there was no utility, it was submitted, in hearing the respondent's strike out application prior to the substantive proceedings.

15 In respect of the second point Mr Trew submitted that he believed this was the first case of its kind in relation to s 108A; it was factually complex and should not be dealt with as a preliminary issue. It was submitted there were extensive differences between the parties in relation to the facts of the matter. For instance, the applicant contended that in relation to a motor vehicle provided to him he reimbursed the respondent for private use of that vehicle. In relation to travel expenses the applicant contended that certain expenditures in that respect could not properly be regarded as remuneration; they were expenses incurred in the performance of the applicant's duties as a director of the Orthopaedic Surgery Department and director of ORI. As to the provision of a clinical secretary it was submitted the secretary was provided "for the purposes of organising the functions of the department and the research institute for which he [the applicant] is reimbursed by the respondent and which should not properly be taken into account in determining his remuneration." A similar situation applied in respect of clinical costs, staff and supplies it was submitted.

16 In relation to the provision of clinical rooms, Mr Trew submitted the evidence would show the rooms were not provided by the respondent and could not therefore be regarded as an employment benefit. But even if the provision of such rooms were not to be regarded as a private benefit the rooms were part of a "system … set up so that the patients participate in the education of medical students, University of New South Wales, and fellows attached to the Institute."

17 As to questions of law, Mr Trew submitted an important issue and one not yet determined, was whether in relation to the operation of s 108A in circumstances where an employee has been paid certain moneys arising out of the employment and these moneys exceed the cap, a distinction can be drawn between what could properly be regarded as remuneration and what has been paid for other purposes. In other words, as I apprehend Mr Trew's submission, is the provision of clinical rooms for example, used not only by the applicant but also by students and fellows attached to the Institute for educational and research purposes, a benefit of a private nature as referred to in s 108A(3) in the definition of "employment benefit" and to be regarded as part of the "total value of monetary remuneration and employment benefits payable or receivable under a contract of employment", or is the amount of money attributable to the provision of clinical rooms to be wholly or partly discounted from the monies received by the applicant in calculating his "remuneration package"?

18 The applicant referred to the Full Bench judgment in Lahoud v Lahoud (2003) 127 IR 243, which contains reference to Nagle (T/as W D and J L Nagle & Sons) v Tilburg (1993) 51 IR 8, Majik Markets Pty Ltd v Brake and Service Centre Drummoyne Pty Ltd (1991) 28 NSWLR 443, Virtue v NSW Department of Education and Training (1999) 92 IR 428 and Euphoric Pty Limited v Ryledar Pty Limited and Anor (2002) 117 IR 1, which in turn contain important statements regarding the principles to be applied by a court entertaining a challenge to jurisdiction in a preliminary or threshold way.

19 The applicant submitted there were important questions of fact yet to be determined and that, as was the case in Lahoud, further evidence and argument was necessary before any determination as to jurisdiction could be made.

20 Reference was also made to the well known passage in Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91 where Dixon J stated: 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.

21 Mr Trew submitted this was not a simple case; there was significant conflict over the facts that needed to be resolved as part of the substantive proceedings. Mr Trew referred to Preston v Star City Pty Ltd [1999] NSWSC 1273 and the cases referred to therein at [29], [30], [35] and [39] where it was emphasised amongst other things that: there was a need for caution in emerging areas of the law; the strike out power was not appropriate in a case where the issue primarily relates to a conflict as to matters of fact or of credit, and; "… the more complex and arguable is the legal point, and the more dependent it may seem to be upon debatable factual premises, the less likely is it that the peremptory relief sought by a party will be appropriate in the circumstances of the case, particularly where it would have the consequence of terminating proceedings altogether or terminating them forever against one party": NRMA Insurance Ltd v A W Edwards Pty Ltd (NSWCA, 11 November 1994).

22 Mr R F Crow of counsel appeared for the respondent. Mr Crow referred to Aveling v UBS Capital Markets Australia Holdings Ltd (2004) 135 IR 98 at [30] where it was stated: …s 108A not only precludes, but prevents, an application being made in respect of a contract with the indicia specified in the section; that is, it prevents an application being made of the relevant class or classes from the time the section operated.

23 It was submitted these words raise a threshold jurisdictional question of a character different to those discussed in cases such as Majik Markets, Nagle v Tilburg, Virtue and Euphoric. In those cases it was submitted, the jurisdictional questions included: (1) whether orders sought under s.106 or its predecessors would be inconsistent with a federal law, and invalid, (2) whether orders sought under s.106 or its predecessors would be inconsistent with another State law, (3) whether the contract was one whereby work was performed.

24 Mr Crow submitted these questions were not raised by an express injunction in the Act as was the case with s 108A. Mr Crow contended the opening words of s 108A compel consideration of the remuneration cap as a threshold or preliminary matter. Similarly, the words of s 108B show that the Commission must be satisfied that an application has been lodged within time before it can proceed to deal with the application.

25 Mr Crow submitted: This construction is consistent with the purposive approach to statutory construction to which s.33 of the Interpretation Act 1987 gives effect. The purpose of ss.108A appears in the Second Reading Speech for the amending Act that introduced it. The relevant extract from this speech is set out in the judgment of Haylen J in Lozevski v Goodman Fielder Consumer Foods Pty Ltd. [2004] NSWIRComm 314 at [50]. The purpose of the section is to exclude from the jurisdiction highly paid executives and to avoid their use of the jurisdiction as " an avenue to excessive enrichment ". Their contractual claims are to be pursued in the common law courts. Such persons would still be able to utilise the jurisdiction, and occupy a much greater proportion of the hearing time of this court, if the identification of the jurisdictional threshold of their remuneration cap could be postponed to a final hearing. The words of s.108A contrast with those in s.109A. The latter section commences with the words " This Division does not apply to …" This formulation directs attention to the remedies for which the Division provides. It does not mandate consideration of jurisdictional questions at any particular stage of proceedings. A different intent must be imputed to Parliament from its avoidance of this formulation and its choice of the words in ss.108A and 108B. As a Full Bench of the Commission in Court Session said of s.108A in Commander Australia Ltd. v Kerr (2004) 134 IR 160 at [30]: It may be observed that the legislature has imposed a particular limit on the jurisdiction of the Commission in relation to s 106 proceedings and has done so in, relatively speaking, peremptory terms. Significantly, the limitation is expressed not in respect of the capacity or power of the Commission to hear, or to hear and determine, or to make orders in, proceedings under s 106. Once raised, the determination of the question whether the application can be made cannot be left to the final hearing, whether on the ground of convenience or otherwise.

26 The respondent submitted that in proceedings under s 106 in which it is alleged that the Commission lacks jurisdiction by reason of ss 108A and 108B, a two-stage process is engaged; the first stage is to determine whether the application can be made and the second is to deal with the application pursuant to the Act.

27 Mr Crow submitted that even if the two-stage process were not required by the proper construction of s 108A, it would be appropriate as a discretionary matter in this case. Section 162(2)(a) required the Commission to act as quickly as is practicable. The separate hearing of the motion was practicable it was submitted and the delay sought by the applicant would contravene s 162(2)(a).

28 It was submitted most of the evidence for the motion has been filed. The circumstances permitted the early and separate hearing of the objection and substantial costs are likely to be saved by so doing.

29 In relation to the second proceedings in 5562 of 2004 Mr Crow submitted that there was no reason for delaying or postponing the hearing of the respondent's motion on the grounds that to hear it separately would lack utility. He foreshadowed a further motion to dismiss the second proceedings was imminent and indicated the respondent would also be relying on s 108B of the Act. Mr Crow submitted the two motions could be heard together.

30 A significant issue in these proceedings is whether in light of the provisions of s 108A of the Act the applicant can make an application for relief under s 106, it being contended by the respondent that the applicant's remuneration exceeds the permissible cap of $200,000. The respondent contends that the Court should consider this issue in a preliminary or threshold way. The applicant submits otherwise and asks that it be deal with it as part of the substantive proceedings.

31 The applicant relies on what it considers to be the differences between the parties as to the relevant facts, the complex factual and legal situation, the novelty of the issue from a legal perspective and the general reluctance of courts to exercise the strike out power where there is a conflict as to matters of fact.

32 In Virtue, Wright J, President collected seven principles relating to threshold challenges to jurisdiction. The principles were adopted in Euphoric and in Lahoud. The principles were as follows: (1) The discretion of a court to determine a case at an early stage, when appropriate, has been repeatedly accepted.

(2) As a general rule it is desirable that an objection to jurisdiction be determined as early as circumstances will conveniently admit so that the tribunal does not embark on a hearing which it lacks authority to conduct. The course of a court entertaining a challenge to jurisdiction in a preliminary or threshold way is often a sensible one where a party has a substantial threshold argument which, if it succeeds, will knock out the claim and save the costs and inconvenience that attend a protracted hearing of proceedings on the merits. (3) However, a further general proposition is that all issues arising should be dealt with in the substantive proceedings unless the basis for a challenge, either on jurisdictional grounds, or for lack of a reasonable cause of action, be clearly demonstrated.

(4) Threshold relief of the kind sought here must be conserved to a clear case where it is plain that the invocation of the jurisdiction impugned is wholly misconceived or, upon analysis, lacks an arguable legal foundation. (5) Necessarily, refusal of relief at the threshold will not finally determine that jurisdiction exists for any order which the Court might make between the parties. This is because, to secure relief, the claimants must demonstrate that no order could be made which would be within jurisdiction. The resulting burden is a heavy one. (6) Accordingly, whilst it is desirable for a case to be determined at an early stage it is only open to do so at the appropriate stage of the proceedings. That is, where the facts, either established by evidence or plainly agreed in terms, enable the Court to determine what the contract or arrangement is or, at least, the parameters of the contract or arrangement. In other words, unless the facts are sufficiently established to enable the Court to be satisfied it has the necessary material to reach a clear and final decision on the question then the appropriate stage has not been reached for such a determination to be made.

(7) Similarly, the jurisdiction to terminate an action summarily for want of a cause of action is to be sparingly employed and ought not to be used save where the lack of the cause of action was clearly demonstrated.

33 In Lahoud, which the applicant relied upon by way of analogy, the Full Bench determined that the trial judge erred because she did not provide the appellants with the opportunity of adducing evidence as to the issue of whether the "Terms of Settlement" was a contract whereby work is performed in an industry. The appellants had sought to bring evidence that the Terms was a contract within jurisdiction in one of three alternative ways but Glynn J, without receiving evidence as to the alternatives, accepted the characterisation of the Terms submitted by the respondents.

34 The situation in Lahoud was quite different to that with which the Court is presently concerned. Most of the evidence as to the applicant's remuneration has been filed and where it has not that can be overcome by simple directions. Further, it seems to me that if a jurisdictional objection is detached or detachable from the factual and legal issues in the substantive proceedings then in the context of a provision such as s 108A, which provides that an application cannot be made if the remuneration exceeds the prescribed cap, the appropriate stage to deal with the objection is at the threshold.

35 In the present case the applicant seeks relief because he contends the respondent has, in effect, reneged on an agreement it made with him in 1997 and he has suffered loss as a consequence. The respondent submits that the applicant cannot make the application for relief because at the relevant time he received a remuneration package in excess of $200,000. The issue in the substantive proceedings is quite different from the issue raised in the strike out motion and the evidence necessary to support the application for relief does not seem to me to have any overlap with the issue for determination in the respondent's motion.

36 What the respondent has to demonstrate is that no order could be made which would be within jurisdiction. Although as it was said in Majik Markets and followed in Virtue that the resulting burden is a heavy one, the issue for determination is relatively clear and separate from the main proceedings: Is the applicant prevented from making the application for relief on the grounds that his remuneration package exceeded the statutory limit? That the facts may not be agreed as to his remuneration or that the facts are complex or that the issues raise novel legal questions are not, in my opinion, grounds to defer consideration of the strike out motion to the substantive proceedings given that if the respondent is successful it will "save the costs and inconvenience that attend a protracted hearing of proceedings on the merits": Majik Markets per Kirby P at 446; 170.

37 Where a strike out application involves a "prolonged and serious argument" it has been held that it should not be entertained unless the judge not only considers it likely that the court will reach the conclusion that the pleading should be struck out but also that such an order would obviate the necessity of a trial, or will so reduce the burden of preparing for a trial or simplify it as to make it worthwhile to proceed with the application: Williams & Humbert v W & H Trade Marks (Jersey) Ltd [1986] 1 AC 368 per Lord Templeman and Lord MacKay. 38 Mr Trew submitted, in effect, that is the case here. I am not, however, left with the impression that the argument will be prolonged. As to the likelihood of the summons being struck out, I have formed no opinion in that respect because, as Mr Trew submitted, there are aspects of the issue that are new and it will be necessary to hear argument about how the provisions of s 108A are to be applied to the facts, although it could not be said the respondent's case, on the face of it, has no chance of success. The benefit, however, of hearing the strike out application is the savings in terms of time and costs that will accrue if the respondent is successful.

39 The fact there might be novel aspects to the argument would not compel me to defer dealing with the strike out application unless in addressing those novel aspects it was necessary to hear the whole case. I do not consider that necessity arises because the threshold issue is a discrete one; its resolution is not contingent in any way on, or relevantly connected to, the issue in the substantive proceedings.

40 That the courts might be reluctant to entertain strike out applications in emerging areas of the law is not a relevant consideration here. There is nothing especially novel about the substantive issue in these proceedings so that if I were to entertain the strike out motion I could not be accused of "stifling the development of the law": Preston v Star City at [29]. On the contrary, there being new issues relating to the application of s 108A, the respondent's motion provides an opportunity to deal with them.

41 The final important point, although not determinative in itself, about whether it is appropriate to deal with the strike out application as a preliminary issue is that s 108A provides that "An application cannot be made for an order under this Division if the contract of employment … (my emphasis)" provides for a remuneration package which exceeds the remuneration cap. I consider the opening words of the section makes a challenge to jurisdiction under s 108A a strong candidate for treatment as a threshold or preliminary matter, subject to a consideration of the principles in Virtue.

42 It is apparent from the opening words of s 108A that the legislature's intention was to preclude the making of applications where an employee received in excess of the prescribed remuneration cap. That is, by introducing s 108A into the Act the Parliament was intending that not only could the Commission in Court Session not make an order under s 106 but also that the employee was prevented from making the application in the first place. The prohibition is something of a fiction because it may not become apparent that the employee's remuneration exceeds the cap until after the application is made and the Court rules on the matter. However, the opening words of s 108A serve to indicate that an application by an employee receiving in excess of the prescribed remuneration cap should not even enter the court system because no relief will be available.

43 That being so, where the Court has before it a strike out application in reliance on s 108A and the facts are sufficiently established to enable the Court to be satisfied it has the necessary material to reach a final decision on the question of whether the remuneration package paid or receivable under the relevant contract during the 12 months preceding the application exceeded $200,000, the opening words of s 108A compel an early consideration of the application.

44 That the application of the facts might be complicated or involve extensive argument is no reason why the determination of the strike out motion should be deferred. As Barwick CJ stated in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 130 "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." 45 As to the applicant's contention that there is no utility in hearing the strike out application before the substantive hearing because 906 of 2003 had been joined with 5562 of 2004 where it is claimed s 108A could not be an issue, the respondent has indicated its intention to file a further motion in relation to the second proceedings. That motion, as I understand it, will rely on s 108A and s 108B. The utility seems to me to lie in hearing both motions together.

46 I do not propose to adjourn the hearing of the respondent's strike out motion in matter No IRC 906 of 2003 until the hearing of the substantive proceedings. The applicant's application in this respect is, therefore, refused. Unless it has already done so the respondent is directed to file and serve its notice of motion in matter No IRC 5562 of 2004 within 14 days of this decision. Both notices of motion will be listed for directions once the notice in the second proceedings has been filed and served. Costs are reserved.

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