Li v MW Toolbox Manufacturing

Note: The form of the order is subject to the entry in the Court's records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 24.04(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth)), or to record a variation to the order pursuant to r 24.04 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth).

1. The applicant, Mr Li, is a former employee of the first respondent, MW Toolbox Manufacturing (Vic) Pty Ltd (MW). The second respondent, Mr Wang, is the sole director of MW. Mr Li has an application before the Court alleging that MW contravened various provisions of the Fair Work Act 2009 (Cth) (Fair Work Act) and applicable awards during the course of his employment and that Mr Wang was involved in those contraventions. Broadly, the alleged contraventions relate to matters including, but not limited to, underpayments, failure to pay full superannuation entitlements, failure to appropriately classify Mr Li's level of employment under the relevant awards, failure to provide payslips, providing payslips which do not contain all relevant detail, requiring Mr Li to work additional hours, and failing to provide Mr Li with a Fair Work Information Statement. Mr Li also alleges that MW breached the employment contract. Mr Li's case is currently set out in a substituted statement of claim filed on 4 March 2025 (Substituted Statement of Claim).
2. The respondents filed an application in a proceeding seeking orders that the Substituted Statement of Claim be struck out in its entirety. In the alternative, the respondents seek orders that certain paragraphs of the Substituted Statement of Claim be struck out. It is the respondents' application in a proceeding which is presently before the Court for determination.
3. For the following reasons, I have decided to strike out the Substituted Statement of Claim. The applicant will be afforded an opportunity to replead the statement of claim, but I will hear further from the parties before making any order to that effect.

1. The respondents filed an application in a proceeding on 28 March 2025 seeking the following orders (strike out application):
   1. An order pursuant to rule 16.21(1)(a) of the Federal Court Rules 2011 (Cth), as picked up by rule 1.06(3) of the GFL Rules and Item 14 of Sch 1 to the GFL Rules, that that the whole of the Statement of Claim filed on 4 March 2025 be struck out.
   2. In the alternative to Order 1, an order pursuant to rule 16.21(1)(a) of the Federal Court Rules 2011 (Cth), as picked up by rule 1.06(3) of the GFL Rules and Item 14 of Sch 1 to the GFL Rule, that paragraphs 128, 129, and 130 of the SOC be struck out and that the claims against the Second Respondent be struck out.
   3. In the alternative to Order 1, an order pursuant to rule 16.21(1)(a) of the Federal Court Rules 2011 (Cth), as picked up by rule 1.06(3) of the GFL Rules and Item 14 of Sch 1 to the GFL Rules, that paragraphs 124 to 127 of the SOC against the First Respondent be struck out.
2. The evidence before the Court for the purposes of the strike out application comprises:

(a) an affidavit of David Baker, lawyer for the respondents, affirmed on 28 March 2025 and filed on behalf of the respondents;

(b) a further affidavit of Mr Baker affirmed on 25 November 2024 and filed on behalf of the respondents; and

(c) an affidavit of Jay Mohan Singh, lawyer for the applicant, affirmed on 14 May 2025 and filed on behalf of the applicant.

1. In their strike out application, the respondents refer to r 16.21(1)(a) of the Federal Court Rules 2011 (Cth) (Federal Court Rules). This allows a party to apply to the Court for an order that all or part of a pleading be struck out on the ground that the pleading 'contains scandalous material'. Since the application was filed, the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth) (GFL Rules) commenced. Rule 16.21(1)(a) of the Federal Court Rules is now reflected in r 13.15(1)(a) of the GFL Rules.
2. Although the strike out application relevantly refers only to r 16.21(1)(a) of the Federal Court Rules, in their submissions to the Court the respondents presented their strike out application as being based on the ground that it is likely to cause prejudice, embarrassment or delay in the proceeding. This ground for striking out a statement of claim reflects r 13.15(1)(d) of the GFL Rules.
3. The concept of embarrassment in the context of pleadings was explained by Tamberlin J in Shelton v National Roads and Motorists Association Ltd (2004) 51 ACSR 278; [2004] FCA 1393 at [18]:

"Embarrassment" in this context refers to a pleading that is susceptible to various meanings, or contains inconsistent allegations, or in which alternatives are confusingly intermixed, or in which irrelevant allegations are made that tend to increase expense. This is not an exhaustive list of situations in which a pleading may be embarrassing: see Bartlett v Swan Television & Radio Broadcasters Pty Ltd (1995) ATPR41-434. An example of an embarrassing pleading is where the pleading simply pleads a conclusion.

1. At the time the Substituted Statement of Claim was filed, r 16.02(1) of the Federal Court Rules required that a pleading must:

(a) be divided into consecutively numbered paragraphs, each, as far as practicable, dealing with a separate matter; and

(b) be as brief as the nature of the case permits; and

(c) identify the issues that the party wants the Court to resolve; and

(d) state the material facts on which a party relies that are necessary to give the opposing party fair notice of the case to be made against that party at trial, but not the evidence by which the material facts are to be proved; and

(e) state the provisions of any statute relied on; and

(f) state the specific relief sought or claimed.

1. This is now reflected in r 13.03 of the GFL Rules.

CONSIDERATION OF THE SPECIFIC COMPLAINTS ABOUT THE SUBSTITUTED STATEMENT OF CLAIM

The respondents' primary position is that the whole of the Substituted Statement of Claim should be struck out

1. The respondents submitted, as their primary position, that the pleadings transgressions are too numerous and widespread for any part of the Substituted Statement of Claim to be preserved: Sabapathy v Jetstar Airways (2021) 283 FCR 348; [2021] FCAFC 25 at [33].
2. The respondents advanced a number of reasons for this submission, which I address in turn.

First reason advanced: the Substituted Statement of Claim fails to plead only the material facts necessary to establish the pleaded cause of action

1. First, the respondents submitted that the Substituted Statement of Claim fails to plead only the material facts necessary to establish the causes of action pleaded. As Katzmann J explained in Dahler v Australian Capital Territory [2014] FCA 946 at [105]:

The obligation of the pleader is to state the material facts. That does not mean all the facts or all the relevant facts. A fact is material if it is essential to the cause of action. The expression refers to the fact or combination of facts that give rise to a right to sue: Do Carmo v Ford Excavation Pty Ltd [1984] HCA 17; (1984) 154 CLR 234 at 245 per Wilson J. The applicant's pleadings did not plead material facts, nor was it as brief as the nature of the case permitted. The statement of claim was discursive. It offended the rule about pleading facts, not evidence. The primary judge was correct to describe it as "replete with detailed matters of evidence". Numerous paragraphs contained detailed extracts from correspondence. No attempt was made to summarise the effect of the correspondence or to relate it to one of the elements of the cause of action. Nor was any made to plead the material facts. Many of the allegations were peripheral to the cause of action. Where inessential facts are pleaded, they are liable to be struck out as prejudicial and embarrassing to the fair trial of the action: Bernard Cairns, Australian Civil Procedure, 10th edition, LawBook Co, 2014 ("Cairns"), [6.180]. The observations that Dawson J made in East West Airlines (Operations) Ltd v Commonwealth of Australia [1943] ArgusLawRp 46; (1983) 49 ALR 323 at 326 ("East West") could equally have been made in the present case:

[E]ven if the statement of claim discloses a cause of action, it does so only in the course of pleading immaterial facts which at best are merely evidentiary and at worst are not relevant at all. The fair trial of the action would be delayed if the defendants were required to plead to these allegations and if other interlocutory procedures could be directed to them. There are also ... matters pleaded which are embarrassing in that they are not susceptible of being pleaded to by the defendants.

1. The respondents identified a significant number of paragraphs that were said to plead matters of evidence irrelevant to, and unnecessary for, establishing any pleaded cause of action. The respondents also identified two paragraphs which appear to plead to Mr Li's knowledge, feelings and state of mind, all of which are irrelevant to and unnecessary for establishing any pleaded cause of action.
2. I will not, in this judgment, set out every impugned paragraph of the Substituted Statement of Claim in full, due to the sheer number of impugned paragraphs. However, I make observations about the paragraphs referred to by the parties in their submissions.
3. In responding to the respondents' submission, Counsel for Mr Li submitted that there are background facts pleaded that provide context, which is potentially very helpful, and the Court should take a flexible approach and not strike them out.

1. Paragraphs 4, 5 and 6 set out background about Mr Li:

4. Leon arrived in Australia as an international student from China.

5. Leon's native language is Chinese.

1. Upon arriving in Australia, Leon had limited knowledge and understanding of the laws of Australia in respect of employment and superannuation.

1. Counsel for the respondents submitted that, while these matters may be relevant to penalty, they are not essential relevant matters or necessary matters to establish the cause of action. He submitted that where Mr Li has pleaded an accessorial liability case against Mr Wang and a serious contravention case against MW, state of mind will be in play from Mr Li's perspective. However, paragraphs 4-5 have nothing to do with the causes of action alleged, which relate to breaches of an award and breaches of a contract, which are strict liability in their nature.
2. Mr Li contends that these paragraphs set out the material facts establishing the seriousness of the contraventions.
3. The paragraphs do not, on their face, plead material facts necessary to establish the causes of action pleaded. It is unclear to me why Mr Li says these paragraphs are material facts for the purposes of establishing that the contraventions are serious contraventions. If the submission is that they are somehow relevant to characterising the alleged contraventions of the Fair Work Act as 'serious contraventions' for the purposes of ss 557A and 557B of the Fair Work Act, this is not evident from the Substituted Statement of Claim.
4. While the inclusion of these paragraphs means that the pleading is not as brief as the nature of the case permits, it is not clear that having to plead to these paragraphs would increase cost of the proceedings. I take this into consideration in exercising my discretion in this matter.

1. Paragraphs 10 and 12 relate to the job interview Mr Li attended with MW and that he was not told whether he would receive a written employment agreement.
2. Paragraphs 15 to 18 relate to the MW stores at which Mr Li worked and that, about a week after commencing employment, he asked whether there was a written contract for him to sign and was told that there was not.
3. Counsel for the respondents submitted that the non-mention of a written employment agreement and that Mr Li attended a second interview says nothing about the causes of action.
4. Mr Li submitted that paragraphs 10, 12 and 15 to 18 set out the material facts to establish a breach of contract.
5. The difficulty with these paragraphs is that they do not plead material facts, but rather plead evidence. It can be inferred from the paragraphs (as well as others in the Substituted Statement of Claim) that the material fact is to the effect that the employment contract was not in writing (at least for part of the period of employment). However, the pleaded matters such as the general manager of the Western Australia region not telling Mr Li in the interview whether there would be a written employment agreement, that there was a subsequent interview by telephone, that Mr Li asked the general manager of the Western Australia region whether he had drafted a written employment contract to sign and was told no are evidence that would support the Court making a finding that there was, at the relevant time, no written employment contract. The pleading of evidence rather than material facts contributes to a finding that the pleading is embarrassing.

1. Paragraphs 31 to 35 relate to Mr Li's meeting of and friendship with Mr Wang and the impact this had on Mr Li's desire to question MW's employment practices. The paragraphs also address Mr Wang telling Mr Li that he was the owner of MW and that Derek Dong was the CEO. Mi Li pleaded that his friendship with Mr Wang impacted on his desire to question the employment practices of MW, that Mr Wang remained at MW due to loyalty to Mr Wang and that Mr Li had the 'hopeful but false' understanding that he was appropriately and correctly remunerated for his work.
2. Counsel for the respondents submitted that these paragraphs contain irrelevant factual material that reads more as evidence than as paragraphs necessary to establish a cause of action. The development of the close friendship, frequent electronic communication and the frequency of playing video games together, which are referred to in the pleading, are not capable of establishing liability against the second respondent and it is unclear what work those paragraphs have to do.
3. Mr Li submitted that these paragraphs set out the material facts establishing Mr Wang's direct involvement in Mr Li's employment and Mr Wang allegedly committing serious contraventions.
4. Again, it is not clear to me how these paragraphs are material to the causes of action pleaded. The pleading does not elsewhere expressly connect these matters to the causes of action pleaded. It is not clear, for example, how the fact that Mr Wang and Mr Li played video games together is relevant to the accessorial liability of Mr Wang under s 550 of the Fair Work Act, or whether the contraventions are serious contraventions within the meaning of ss 557A and 557B of the Fair Work Act. The reason for the pleading that Mr Wang told Mr Li that Mr Dong was CEO is also unclear. Mr Dong, so far as I can see, is referred to at only one other place in the Substituted Statement of Claim, in the particulars to paragraph 30 as a person who was included in a WeChat message. If his position as CEO is a material fact (and I do not understand why it would be), then it is unclear why that would not be pleaded directly, instead of a pleading relating to a conversation between Mr Li and Mr Wang. If the conversation is the material fact, then it should be made clear how that relates to the pleaded causes of action.
5. I accept the respondents' submission that these paragraphs are embarrassing on the basis that they contain irrelevant factual material which is evidence rather than a material fact.

1. Paragraphs 55 to 57 relate to Mr Li's resignation notice, the end of his employment and the reasons for his resignation. These paragraphs read:
   1. On or around 10 November 2022, Leon gave notice to MW that he was resigning ("Resignation Notice").
   2. After giving the Resignation Notice, Leon continued to work for a period of 1 month or thereabouts until 10 December 2022.
   3. Leon gave the Resignation Notice due to the fact that Wang had broken his promise to him which he made to Leon around the time Leon started working in Victoria, as stated at paragraph 50.4 above, being a promise that at a later stage when the various Australian state borders were relaxed, that he would be transferred back to Perth, WA and be given the store manager role at the O'Connor Store.
2. Counsel for the respondents submitted that these paragraphs are irrelevant to the causes of action and would require delay to address them. Counsel for the respondents submitted that these are matters that might subsequently be relevant to submissions regarding penalty.
3. Mr Li submitted that these paragraphs set out the material facts establishing an alleged breach of contract by the respondents and the various contraventions.
4. While the cessation of employment might have been pleaded more succinctly, paragraphs 55 and 56 are adequate and would not need to be struck out.
5. Paragraph 57 is more complex, in part because it is difficult to see how it fits with the overall causes of action. Mr Li has elsewhere pleaded (at paragraph 48 of the Substituted Statement of Claim) that he agreed to a proposal of Mr Wang that Mr Li would continue his employment with MW in Victoria until the borders between states were reopened and would then return to the O'Connor Store (in Western Australia) and take over as general manager. He pleaded at paragraph 134.4 that this was a term implied into his contract. I am unable to locate any paragraph where it is expressly pleaded that this term of the contract was breached. If the purpose of paragraph 57 is to allege a breach of the contract, it should do so clearly and not by reference to Mr Li's reason for resigning. If there is no alleged breach of the alleged implied term (and having regard to the structure and content of the Substituted Statement of Claim as a whole, it does not appear to be alleged as a breach of an implied term), then it is unclear why Mr Li's reasons for resigning are a material fact in relation to any of the pleaded causes of action.

1. In their written submissions, the respondents referred to paragraphs 66 to 70, which relate to events after Mr Li resigned from MW. These paragraphs read:
   1. In or around 14 July 2023, after Leon had resigned from MW he suspected that MW might not have paid him correctly throughout his employment.

67.1 MW had not given him any pay slips, apart from two, in the year of 2018;

67.2 MW had not given him any pay slips for the period commencing from the start of 2019 to 21 July 2019; and

67.3 MW had only given him the timesheets for the period commencing 5 March 2018 to 21 July 2019, despite him being employed until 10 December 2022.

Particulars

Two payslips for pay periods:

14/05/2018 to 27/05/2018

28/05/2018 to 10/06/2018

68. Leon instructed lawyers to assist in his investigations.

69. After consulting with lawyers, Leon became aware that:

69.1 the 2010 and 2020 versions of the General Retail Industry Award ("the Retail Award") applied/covered his employment with MW;

69.2 MW as an employer had owed various obligations to him under the FW Act, FW Regulations and the Retail Award as set out later in these pleadings;

69.3 MW may have contravened the FW Act, FW Regulations and the Retail Award for its failures as identified in paragraph 67 above.

70. From further investigations, Leon discovered from pay slips provided that:

70.1 the two pay slips mentioned above at paragraph 67, did not specify his employee classification level;

70.2 each and every pay slip provided to Leon by MW:

(a) did not contain an hourly rate for his ordinary hours;

(b) did not contain any rates for his time worked on weekdays after 6PM, Saturdays, Sundays and public holidays;

(c) did not contain any penalty rates;

(d) did not contain any total sums paid as overtime, working on Saturday, Sunday and public holidays;

(e) did not contain any total penalties paid; and

(f) did not contain his annual leave accrual.

1. Counsel for the respondents submitted that these matters occurred after Mr Li's resignation from employment and deal with his alleged discovery of the claim that he has now brought. The paragraphs refer to the instruction of lawyers, consultation with lawyers and further investigations. The matters occurred after employment and cannot be said to have any relevance to the employment.
2. In oral submissions, Counsel for the respondents also referred to paragraph 71 in addressing these paragraphs, which pleads that MW provided timesheets to Mr Li for the period from 5 March 2018 to 21 July 2019. Counsel for the respondents submitted that this appears to be the basis for the underpayment claim. It refers to time sheets, but does not refer to the actual allegations made by Mr Li as to the hours he says he worked and the amounts he says he is owed.
3. In my view, the matters referred to in paragraphs 67.1 to 67.3, 69.1 to 69.3 and 70.1 to 70.2 are material facts. However, they are not directly pleaded as material fact and are rather pleaded as part of Mr Li's knowledge, instruction of legal representatives or discovery of the alleged contraventions. It is not clear why Mr Li's knowledge or discovery of the contraventions, including the steps taken to discover the alleged contravention, are material facts to the causes of action pleaded. The form of the pleading invites the respondents to plead to Mr Li's knowledge and discovery of the alleged contraventions, rather than to admit or deny the alleged contraventions themselves. This invites confusion and includes irrelevant matters in the pleading that would increase the cost of responding to it and is embarrassing on that basis.
4. Paragraph 71 does not fully put the respondents on notice of the case they are required to meet, but it needs to also be ready with other parts of the Substituted Statement of Claim. The respondents' concern about the failure to plead the hours worked and the amounts owed is addressed in a different context below.
5. To the extent that paragraph 71, read in context, does not put the respondents on notice of the case they are required to meet, this could be addressed by the provision of further particulars, rather than by striking out the statement of claim.

1. Paragraphs 84 to 87 relate to correspondence between Mr Li's lawyers and MW's lawyers prior to Mr Li commencing litigation. Counsel for the respondents submitted that these matters succeed the employment.
2. These paragraphs do not appear to be addressed by or on behalf of Mr Li. They do not appear to be a material fact to any cause of action. It appears that they have been included as matters relevant to costs, as there is a cross-reference to those paragraphs at paragraph 147. The complaints in relation to pleadings on costs are addressed (albeit briefly) below.

1. These paragraphs were referred to in the oral submissions advanced by Counsel for the respondents, but not in the written submissions.
2. Counsel for the respondents submitted that paragraphs 88 to 89 plead the law. He did not raise any concern with this per se, but submitted that the two paragraphs are simple recitations of the relevant award.
3. The paragraphs plead the obligations of MW under the relevant awards. I do not consider these paragraphs need to be struck out.
4. Counsel for the respondents acknowledged that the pleadings of the contraventions commences from 90, but submitted that it simply pleads the contraventions, without referring the material facts as to how each clause was contravened. Rather, the paragraph alleges bare conclusions. The respondents made the same complaints about paragraphs 91 to 101.
5. Counsel for Mr Li submitted that these complaints are bad complaints because the paragraphs are important for the purposes of classifying Mr Li under an award. Counsel for Mr Li characterised the respondents' complaints about these paragraphs as being that they are irrelevant and immaterial. That is not an accurate reflection of the concerns raised by Counsel for the respondents. The concerns raised were not that the paragraphs were irrelevant or immaterial, but rather that they do not contain sufficient facts as to how each provision is allegedly contravened, and rather are conclusory.
6. Counsel for Mr Li also submitted that a level of generality is permitted, particularly in relation to the calculation of how many hours Mr Li worked and what he is entitled to be paid. This is said to be particularly so in circumstances where Mr Li does not have all relevant information available to him.
7. I appreciate that Mr Li may feel that he does not have all relevant information at present and is hoping to obtain more information following discovery (which, as I reminded him at the hearing, is not available as of right in this Court). I infer that he does, however, have some basis for making the allegation, which is not particularised in the Substituted Statement of Claim. There are ways in which an applicant can put a respondent on notice of the case they are required to meet in relation to alleged underpayments, even if they do not have all possible records: see, for example, Gallagher v AAG Labour Services Pty Ltd [2020] FCA 1753 (Gallagher) at [13].
8. While I am of the view that more could be done to ensure the respondents understand the allegations against them, this is a matter that might be rectified with additional particulars, rather than striking out the relevant paragraphs of the Substituted Statement of Claim.

1. The paragraphs of the Substituted Statement of Claim that the respondents say plead irrelevant aspects of Mr Li's knowledge, feelings and state of mind are 14 and 58. These paragraphs read:
   1. At all material times:

14.1 Leon did not know that full-time hours mean that he was supposed to work a maximum of 38 hours per week.

14.2 Leon did not request that his employment be documented in writing because:

(a) he felt that he was not in a position to make such demands; and

(b) he did not know what his legal rights were under Australian Law.

14.3 Leon did not question the way in which his employment was confirmed because he felt it is considered improper for him to question a potential employer in the way in which it carries out its practice of hiring employees; and

14.4 MW was required to ensure that the job/role offered to Leon which he accepted, complied with the relevant modern award that was applicable to the job/role, the FW Act and the Fair Work Regulations 2009 ("FW Regulations").

58.1 Leon had trusted MW to pay him the correct wages and commission; and

58.2 MW and/or Wang took advantage of Leon's trust and lack of understanding of Australian law in order to gain a financial advantage.

1. In relation to paragraph 14, Counsel for the respondents submitted that the paragraph refers to what Mr Li understood, or what Mr Li did not do, based on his understanding. They do not relate to what the respondents did.
2. Mr Li submitted that pleading his knowledge, feelings and state of mind are necessary facts to establish the various contraventions and the seriousness of the contraventions. In oral submissions, Counsel for Mr Li submitted that the personal friendship, gaming, talking on the phone and meeting at restaurants are pleaded because they are important to establish the mental element for the purposes of s 550 of the Fair Work Act and the seriousness of the contraventions.
3. While the Court can understand why the matter in paragraph 14.4 is pleaded as a material fact, it is difficult to see how the other matters referred to in paragraphs 14 and 58 are said to be relevant to s 550 of the Fair Work Act or whether the contraventions are serious contraventions within the meaning of ss 557A and 557B of the Fair Work Act.
4. Section 550 is an accessorial liability provision that provided that a person who is involved in a contravention of a civil penalty provision is taken to have contravened the provision. When a person is 'involved in' a contravention is set out in explained in s 550(2), which provides:

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

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

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

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

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

1. Mr Wang's knowledge, feelings or state of mind might be relevant to determining whether he was 'involved in' any alleged contravention, but on its face, the application of s 550(2) does not turn on Mr Li's knowledge, feelings or state of mind. If it is said to somehow be relevant, then this needs to be better explained to put Mr Wang on notice of the case he has to meet. In this regard, I note that the pleading at paragraph 130 pleads in part that:

Wang through using his close relationship and/or friendship with Leon and understanding and/or knowledge of his employment with MW, induced the contraventions, whether by promises or otherwise.

1. I address paragraph 130 in more detail below. For present purposes, it is sufficient to note that if this is the purpose of pleading Mr Li's knowledge, feelings and state of mind, it needs to be more clearly articulated so that Mr Wang understands the case against him.
2. Sections 557A and 557B of the Fair Work Act provide:

557A Serious contravention of civil remedy provisions

(1) A contravention of a civil remedy provision by a person is a serious contravention if:

(a) the person knowingly contravened the provision; or

(b) the person was reckless as to whether the contravention would occur.

Note: For the liability of bodies corporate for serious contraventions, see section 557B.

Example: Generally, subsection 323(1) requires an employer to pay an employee the full amount payable to the employee in relation to the performance of work.

A contravention of subsection 323(1) is a serious contravention if the employer knowingly does not pay the employee in full or is reckless as to whether the failure would occur. It does not matter if the employer does not know the exact amount of the underpayment.

(2) For the purposes of subsection (1), a person is reckless as to whether a contravention would occur if:

(a) the person is aware of a substantial risk that the contravention would occur; and

(b) having regard to the circumstances known to the person, it is unjustifiable to take the risk.

Involvement in a serious contravention

(5A) A person (the involved person) who is involved in a contravention of a civil remedy provision by another person (the principal) commits a serious contravention of the provision only if:

(a) the principal's contravention was a serious contravention; and

(b) the involved person knew that the principal's contravention was a serious contravention.

Application for a serious contravention order and alternative orders

(6) If a person is applying for an order in relation to a serious contravention of a civil remedy provision, the person's application under subsection 539(2) must specify the relevant serious contravention.

(7) If, in proceedings for an order in relation to a serious contravention of a civil remedy provision, the court:

(a) is not satisfied that the person has committed a serious contravention against that provision; and

(b) is satisfied that the person has contravened that provision;

the court may make a pecuniary penalty order against the person not for the serious contravention but for the contravention of that provision.

557B Liability of bodies corporate for serious contravention

(1) For the purposes of subsection 557A(1), a body corporate knowingly contravenes a civil remedy provision if the body corporate expressly, tacitly or impliedly authorised the contravention.

(2) This section does not limit section 793.

1. How Mr Li's knowledge, feelings and state of mind are relevant to whether the contraventions are serous contraventions is not clear from the Substituted Statement of Claim and would require guess work on the part of the respondents.
2. I accept that paragraphs 14 and 58 are embarrassing.

Second reason advanced: conclusions pleaded based on unstated facts and intermixes submissions, evidence, scandal and irrelevance

1. Second, the respondents allege that the Substituted Statement of Claim pleads conclusions the truth of which rest upon unstated facts and intermixes submissions, evidence, scandal and irrelevance in a way that defies sensible response. They cite two authorities in support of their submission.
2. In McKellar v Container Terminal Management Services Ltd (1999) 165 ALR 409; [1999] FCA 1101 (McKellar), Weinberg J said at [23]:

A number of authorities support the proposition that a statement of claim must contain material facts, being the facts necessary for the purpose of formulating a complete cause of action, and that it is not sufficient simply to plead a conclusion drawn from unstated facts... A statement of claim which simply repeats the language of a provision of the Act, and then baldly asserts a contravention of that provision, without more, will be struck out.

1. In Weddell v Rasier Pacific Pty Ltd [2023] FCA 59, Snaden J struck out a statement of claim that he described at [74] as being:

... written in narrative, and occasionally loaded and emotional prose, as if for consumption not by legal practitioners or the court but by industry or media. It presents as a sprawling, discursive account of all manner of concerns that the applicants wish to ventilate. With very few exceptions, its constituent paragraphs intermix submission, evidence, scandal and irrelevance; virtually always in a long-winded way that defies sensible response.

1. The respondents identify examples of this in their written submissions. One such example given is paragraph 20 of the Substituted Statement of Claim. In paragraph 20, Mr Li pleads that his employment contract with MW 'by way of necessity and/or general law and/or under the provisions of the FW Act' included nine implied terms. The implied terms included 'that Leon's remuneration would be increased from time to time' and that 'Leon be properly remunerated for all his time worked'.
2. The respondents further submit that this particular pleading is inconsistent with well-established authority that the terms of industrial awards or industrial legislation derive their force from statute, not from contract: Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 (Byrne) at 419.
3. Counsel for the respondents confirmed in his oral submissions that the respondents take no issue with paragraph 20 being a pleading of law. Rather, the issue is that the paragraph does not plead the basis, or the material facts, as to how the terms are to be implied.
4. In response, Mr Li submitted that paragraph 20 conforms with 'general principles which govern a statement of claim based upon a breach of an agreement', by reference to McKellar. In McKellar, Weinberg J said at [123]-[126]:

123. Where such an action is brought the statement of claim should show whether the agreement relied on is in writing or made by word of mouth or is to be implied or inferred from the conduct of the parties. In all cases the date, the parties, and the general substance and effect of the agreement so far as is material must be set out.

1. In the case of a written agreement the document or documents which contain that agreement should be described sufficiently to identify it or them. In the case of an implied agreement the facts and circumstances from which the implication arises should be stated.

125. Consideration is, of course, necessary to the validity of a simple contract. It must, in general, be shown in the statement of claim. The material terms of the agreement which are relied upon must be set out.

126. After the terms of the agreement have been clearly stated, the plaintiff must show whether his claim is founded under or by virtue of the terms of the agreement, or whether it is founded upon a breach thereof.

1. Mr Li submitted that the paragraph is pleaded in sufficiently clear and precise words.
2. Not all of the submissions relating to Byrne made at the hearing are addressed in this judgment. The respondents' reference to Byrne relates to a finding that a debt that arose by way of an award owed its origin to statute and not to contract. While I acknowledge this submission, it is something that can be addressed in a defence rather than by striking out the statement of claim. To the extent that there are said to be other implied terms, in relation to which the basis of the implication is not sufficiently stated, I acknowledge the respondents' concern. This could potentially be addressed by the provision of further particulars.
3. Another example given is paragraphs 145 to 149 which make submissions in relation to penalty and costs.
4. The respondents submitted that these paragraphs are very difficult to respond to, in the usual way of 'admit', 'deny' or 'does not know therefore cannot admit'. Rather, Mr Li could simply plead that he seeks penalties or that he seeks costs and that would be sufficient.
5. Counsel for Mr Li submitted that there is no harm in explaining why remedies are needed in a pleading and the respondents simply need to admit or deny the entitlement to remedies.
6. I agree that some of the paragraphs relating to penalty and costs contain submissions and not material facts and can be seen as embarrassing. While it is appropriate in the pleading to indicate that the applicant seeks costs and penalties, the inclusion of submission (including, for example, that pecuniary penalties would 'serve to compensate Leon for the many years of service he dedicated to MW and/or Wang' and 'would be a fair and just means of compensating him for his damage and loss suffered') do make the pleading more difficult to respond to. To the extent that the pleading contains submission, it is embarrassing.

Third reason advanced: the pleading is vague and unintelligible

1. The third complaint about the Substituted Statement of Claim is that it is vague and unintelligible in relation to important matters. The respondents cite, in support of their submission, Fair Work Ombudsman v Eastern Colour Pty Ltd [2011] FCA 803 at [18], where Collier J referred to 'embarrassing' pleadings as including those with 'defects resulting in the pleading being unintelligible, ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged against it'.

1. The examples given of this include paragraphs 28 and 29, which read:
   1. During Leon's employment at MW, he found out that MW had expectations of him that he found to be unreasonable, and further that at all material times, such expectations of him were never disclosed to him during his interview:

28.1 he was constantly required to work long hours, beyond what he considered reasonable, which he would classify as being overtime hours; and

28.2 he was required to do tasks that were beyond a salesperson's role.

29.1 Leon felt that he had no choice but to submit and/or comply with MW's expectations otherwise he feared that he would lose his job; and

29.2 Leon worked beyond the hours at paragraph 11.6 above, almost every day, just so he could meet MW's expectations, and sometimes he would stay as late as 10:00PM (Western Australia Time "WST") on weekdays.

1. Counsel for the respondents submitted that it is unclear whether these paragraphs are said to be the basis of, for example, a contravention of the relevant award, which would be premised on the working of overtime hours without overtime pay being provided. It is then difficult to understand the references to Mr Li's subjective views: whether or not the hours are overtime is a simple binary fact based on the proper construction of the relevant award and the hours worked, not Mr Li's subjective views.
2. In relation to paragraphs 28 and 29, Mr Li submitted that the paragraphs set out the material facts establishing the contraventions and the seriousness of the contraventions. He further submitted that he has already provided further and better particulars in relation to these paragraphs.
3. These paragraphs purport to plead material facts and contraventions in a confusing way. If the intention is to plead that Mr Li worked overtime hours for which he was not, but ought to have been, paid at the overtime rate, then it would be appropriate to plead this clearly, without reference to Mr Li's subjective opinion.
4. As currently pleaded, these paragraphs are difficult for the respondents to respond to in a defence. For example, in relation to paragraph 28, it appears that the respondents are being invited to plead to whether Mr Li subjectively found MW's expectations to be unreasonable, rather than a fact that is material to an alleged contravention. I accept that these paragraphs can be characterised as embarrassing.

1. Another example given is paragraphs 44 to 50 and 53 to 54, which relate to Mr Li taking a period of leave and then travelling within Australia and working at different stores of MW, without pleading how such leave is to be treated in respect of the pleaded causes of action.
2. Counsel for the respondents submitted that paragraphs 44 to 50 are insufficiently clear, unintelligible submissions that go to important matters. They go to the working hours and the working months of Mr Li. While there is a reference to Mr Li returning from leave and moving about within Victoria, it is not clear whether it is alleged whether these periods do or do not fall into Mr Li's claim period for the breaches of the award.
3. In response, Mr Li submitted that these paragraphs set out the material facts establishing the applicant's continued employment with MW, and alleged breach of contract and the various contraventions.
4. Paragraphs 44 to 50 could be pleaded more concisely and more precisely. They are drafted in a way that makes it difficult for the respondents to understand the case against them. I do not know whether these paragraphs are somehow said to be relevant to the allegations of contraventions of the Fair Work Act (including contraventions of the awards), as that is not clear from the Substituted Statement of Claim. However, I acknowledge that at least some of the paragraphs are relevant to the alleged breach of contract. For example, the matter pleaded in paragraph 48.2, to the effect that Mr Li and Mr Wang agreed that Mr Li would return to the O'Connor store as general manager when the state borders reopened following Covid, was pleaded at paragraph 134.2 to be an implied term of the employment contract (presumably as a variation to the contract, in circumstances where it was pleaded at paragraph 50.1 that Mr Li remained an employee at all times, despite a period of approximately three months that he spent in China).
5. Counsel for the respondents submitted that paragraphs 53 and 54 are insufficiently clear to understand and to respond to.
6. I accept that these paragraphs are vague and that it will be difficult, albeit not impossible, to respond to them. Paragraph 53 pleads that before commencing work at the Dandenong store, Mr Li worked at 'a few MW stores temporarily' and paragraph 54 pleads that 'for most of Leon's employment with MW in Victoria' he worked at the Dandenong store, on 'a few occasions he worked at other MW stores within Victoria' and he worked at a '2-day four-wheel drive event in Victoria'.

Fourth reason advanced: the Substituted Statement of Claim is confusing and otherwise difficult to comprehend

1. The fourth reason the respondents submit that the Substituted Statement of Claim should be struck out in its entirety is because it is confusing and difficult to comprehend, insofar as it contains various different headings, subheadings, paragraphs, sub-paragraphs, sub-sub-paragraphs, circular cross references and fails to keep a linear path.
2. In oral submissions, Counsel for Mr Li suggested that many of the complaints in relation to the Substituted Statement of Claim, including what he described as a complaint that 'the entire statement of claim, first, pleads too many irrelevant facts, second, is too prolix, too long, too confusing, refers to too many parts of the pleading', are simply matters of style. Counsel for Mr Li described the style of the Substituted Statement of Claim as a narrative style and referred to following observations of Drummond J in State of Queensland v Pioneer Concrete (Qld) Pty Ltd [1999] ATPR 41-691; [1999] FCA 499, cited by Weinberg J in McKellar at [30]:

Authority acknowledges the blurring, in recent times, of the distinction between pleadings and particulars: see,. eg, Beach Petroleum NL v Johnson (1991) 105 ALR 456 at 466, where von Doussa J referred to the tendency now "towards narrative pleading as there is a growing concern that pleadings according to traditional rules do not adequately make known to the court and to the parties the nature of the opposing cases in complex matters." His Honour also commented that: "[t]echnical objections raised to pleadings on the ground of alleged want of form will be received with less enthusiasm today than in times past."

Notwithstanding O 11 r2(a), a respondent does not have an absolute right in every case to insist upon the applicant pleading in the statement of claim every material fact necessary to show the existence of a complete cause of action.

1. Counsel for Mr Li submitted that the Court should look at what is saving a claim, rather than trying to strike it all out.
2. There are a number of headings and subheadings in the Substituted Statement of Claim. In reply submissions, Counsel for the respondents confirmed that it was not the use of heading or cross referencing that was objected to in this case, but rather the application of them.
3. I acknowledge that different practitioners adopt different styles of pleading, and it may not be appropriate to strike out a pleading on the basis of style of form alone, except perhaps in an extreme case. The Substituted Statement of Claim takes significant effort to follow and attempt to comprehend. The extent of cross referencing in places requires significant effort to follow (the example below in relation to paragraph 112 gives some indication of this) and in other places there are general references to matters pleaded elsewhere in the pleading.
4. Despite the effort required to logically follow the Substituted Statement of Claim, I would not, in the circumstances of this case, exercise my discretion to strike out the whole of the pleading on this basis alone. Nevertheless, in circumstances where, for other reasons, I have decided to strike out the whole statement of claim, the legal team for Mr Li may wish to consider whether an alternative structure may lead to a clearer pleading.

Whether paragraph 112 does not meet the 'bare minimum' discussed in Gallagher

1. In their original submissions, the respondents did not raise any complaint about paragraph 112 of the Substituted Statement of Claim.
2. The paragraph was first raised in the respondents' reply submissions filed on 19 May 2025, in response to a submission by Mr Li that he has been 'unnecessarily accommodating' with the provision of further and better particulars and the documents referred to in the Substituted Statement of Claim to ensure the respondents well and truly know the case they have to meet. The respondents submitted that the particulars to paragraphs 112.1, 112.2, 112.7 and 112.8 of the Substituted Statement of Claim do not give adequate notice of the case to be answered and fail against the baseline criteria set out by Jackson J in Gallagher at [15]. The respondents submitted that the particulars do not shed light on the hours Mr Li says he worked and, in any event, the particulars were provided on the basis that Mr Li 'reserved the right to amend [them]'.
3. This issue became the subject of extensive oral submissions, particularly by Counsel for Mr Li. Despite the length of time spent on this issue by Counsel for Mr Li, I will not address it to the same level of detail as he did, as it was not advanced as a matter that goes to the heart of the strike out application. I also note that paragraph was addressed by Counsel for Mr Li in the context of the cross referencing in the pleading and I make some brief references to that.
4. In Gallagher, Jackson J considered a statement of claim alleging that the employer failed to pay the applicant for all the hours she worked while she was an employee. His Honour did not consider that the statement of claim adequately put the respondent on notice of the case it had to meet in circumstances where a total of hours worked for relevant periods was pleaded without articulating the basis for the calculation.
5. As I understand the respondents' position, it was that parts of paragraph 112, even when considered in the context of the particulars provided still do not clearly put them on notice of the case they have to answer.
6. By way of example, paragraphs 112.1 and 112.2 of the Substituted Statement of Claim read:
   1. MW contravened s 45 of the FW Act by having contravened cl 17 of the 2010 Award and cl 17 of the 2020 Award as pleaded above at paragraph 90.3:

112.1 by failing to pay Leon with the minimum wage as a Retail Employee Level 1 from 5 March 2018 to 30 June 2019; and

112.2 by failing to pay Leon with the minimum wage as a Retail Employee Level 4 from 1 July 2019 to 10 December 2022.

1. To understand the basis of this alleged contravention, it is necessary to refer back to paragraph 90.3. In this paragraph it is pleaded that MW contravened cl 17 of the 2010 Award and cl 17 of the 2020 Award by not paying Leon the minimum rates by reference to his employment level as identified from his duties and responsibilities as pleaded at paragraphs 23 to 25 and 52 above and 'further explained below'. Paragraphs 23 to 25 plead Mr Li's duties at various times and paragraph 52 pleads Mr Li's duties and responsibilities at the Dandenong store. The reference in paragraph 90.3 to 'further explained below' is possibly a reference to paragraphs 91 to 101. These paragraphs address why it is said that the awards apply to Mr Li's employment, the claimed employment level of Mr Li at various times with reference to his duties, the minimum wage that Mr Li was entitled to be paid under the Awards and a claim that he was no paid the minimum amounts under the Awards.
2. This does not fully put the respondents on notice of the entirety of the relevant parts of the case they have to answer, and the pleading does not rise to the level required in Gallagher. Both parties acknowledged that provided particulars on the basis that a party reserved the right to amend them was problematic.

Whether the Substituted Statement of Claim is embarrassing

1. While not every concern raised by the respondents demonstrates that the Substituted Statement of Claim is embarrassing, I have identified a number of paragraphs that are, in my view, appropriately characterised as embarrassing. These are sufficient in number and in significance that the entire Substituted Statement of Claim is liable to be struck out on the basis that it is embarrassing, subject to the consideration of discretionary matters, which I address below. This is the case notwithstanding that there were some paragraphs that I identified that, if considered in isolation, would not be struck out. However, before turning to the discretionary considerations, it is appropriate to address the paragraphs referred to in the respondents' alternative position.

The respondents' alternative position that certain paragraphs of the Substituted Statement of Claim should be struck out

1. The respondents' alternative position is that paragraphs 124 to 130 of the Substituted Statement of Claim should be struck out. These paragraphs read:

VIII. SERIOUS CONTRAVENTIONS

(a) MW

1. Each and every contravention pleaded throughout these proceedings are serious contraventions.

125. MW has contravened s 557A by reason of s 557B of the FW Act.

1. MW expressly, tacitly or impliedly authorised all the contraventions, being that:

126.1 every pay slip provided to Leon stated upon each document:

(a) the Australian Business Number (ABN) of MW; and

(b) the heading "MW Toolbox Manufacturing (VIC) Pty Ltd" or alternatively, a similar variation of the heading;

126.2 the Written Contract provided to Leon was on a company letterhead and had all the same details as the preceding paragraph 126.1 above.

Particulars

Further particulars may be provided after discovery.

126.3 at all material times, MW's officers, employees, agents and/or servants, who act on MW's behalf, authorised the contraventions:

(a) whether by act or omission; and/or

(b) by failures and contraventions under the Awards, FW Act and FW Regulations; and/or

(c) as pleaded in more detail throughout these pleadings.

1. Under s 793 of the FW Act, Wang's actions, conduct and/or omissions as described in the paragraphs below, is taken to have been also engaged in by MW.

(b) Wang

1. At all material times, Wang was aware of the circumstances of Leon's employment and the way in which MW was conducting its business.
2. From the period of 11 June 2019 to 18 August 2021, by a series of WeChat messages in the two group chats and a personal chat between Wang and Leon, Wang was directly involved in the operational aspects of MW and/or the daily managerial aspects of MW, and as such, Wang has and/or ought to have direct knowledge of, but not limited to, the following:

129.1 Leon regularly worked overtime on weekdays;

129.2 Leon regularly worked past 6:00PM on weekdays;

129.3 Leon regularly worked on Saturdays;

129.4 Leon worked on Sundays and on public holidays;

129.5 Leon was not getting paid appropriately for all the time he worked at MW;

129.6 Leon's base salary;

129.7 Leon's rate of commission

129.8 Changes to Leon's salary and commission;

129.9 MW's daily management of the stores in which Leon worked;

129.10 The weekly updates, monthly updates and reports produced by MW's store managers in relation to various MW stores; and

129.11 Leon's personal circumstances and troubles and/or concerns in the workplace.

Particulars

1. WeChat messages between Wang and Leon from 11 June 2019 to 29 July 2021;
2. WeChat group messages in chat group named "My Bosses" from 9 November 2019 to 19 March 2021;
3. WeChat group messages in a chat group named "YA Management Group" from 23 June 2019 to 18 August 2021; and

Further particulars may be provided after discovery.

1. By Wang's direct and/or indirect involvement as pleaded in paragraph 128 to 129 above:

130.1 Wang has contravened s 550 of the FW Act being that:

(a) Wang by being officer of the company and/or as sole director of MW and being the person in the company with the most authority, had aided, abetted, counselled or procured the contraventions;

(b) Wang through using his close relationship and/or friendship with Leon and understanding and/or knowledge of his employment with MW, induced the contraventions, whether by promises or otherwise;

(c) Wang for the reasons set out at paragraph 128.1 above, has been by his acts and/or omissions toward Leon and others in MW, directly or indirectly knowingly concerned in or party to the contraventions; and

(d) Wang has conspired with others at MW to effect the contraventions as pleaded in these proceedings.

Particulars

Same particulars as provided in particulars of paragraph 129 above.

Further particulars may be provided after discovery.

130.2 By contravening s 550 of the FW Act, Wang contravened s 557A making the contraventions he was involved in, serious contraventions:

(a) Wang being sole director of the Company, knowingly contravened the Awards, FW Act and FW Regulations, as pleaded throughout these pleadings;

(b) in the alternative, Wang was reckless to allow the contraventions as pleaded throughout these pleadings to occur:

(i) as it was reasonable that Wang as sole director, was at all material time aware of the substantial risk that the contraventions would occur; and

(ii) it was unjustifiable for Wang to take the risk.

Particulars

Same particulars as provided in particulars of paragraph 129 above.

Further particulars may be provided after discovery.

1. The respondents submitted that paragraphs 128 to 130 of the Substituted Statement of Claim contain rolled-up and conclusory allegations that do not disclose a reasonable cause of action against Mr Wang and, in parts, do no more than recite the statutory text of s 550 of the Fair Work Act. The respondents submitted that paragraphs 128 to 130 transgress the important requirements for a pleading that a person is 'knowingly concerned' in a contravention referred to in Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201, where Thawley J said at [29]:

A pleading that a person is "knowingly concerned" in a contravention is a serious one, akin to a pleading of dishonesty - see: Stefanovski v Digital Central Australia (Assets) Pty Ltd [2018] FCAFC 31 at [70]. A pleading that a person was knowingly concerned in a contravention, exposing them to personal liability and seeking the imposition of civil penalties, should be drafted with some considerable care. It should plead the material facts said to establish that the person was knowingly concerned in the contravention. This includes an express identification of the elements of the contravention and an express pleading that the person had knowledge of each of the essential elements constituting the contravention. It should identify the material facts said to establish knowledge or from which such knowledge is to be inferred. The pleading should generally also identify the material facts said to constitute the relevant acts or omissions of the person which are relied upon as establishing any practical connection with or link to the contraventions ... which are contended to establish the person was "knowingly concerned" within the meaning of s 550(2)(c).

1. The respondents further submitted that they cannot fairly plead to the claims in paragraphs 128 to 130 and that the survival of claims against Mr Wang would require Mr Wang to, personally, plead in response to the Substituted Statement of Claim, which would cause significant and undue prejudice to Mr Wang and delay in the conduct of the proceeding.
2. In oral submissions, Counsel for the respondents submitted that paragraph 128 is a conclusory pleading. Counsel for the respondents acknowledged that paragraph 129 was a better attempt to plead material facts, but was still insufficient. One of the concerns raised was that the pleading at paragraph 129 refers to a period of three years' worth of WeChat messages across three different groups, without particulars to shed light on the messages the respondents should examine to see if the allegation is made out. Rather, it appears that the respondents are to go through all the messages itself to work out what the position is. Counsel for the respondents submitted that paragraph 130 is likewise conclusory.
3. In response, Counsel for Mr Li submitted that the paragraphs are sufficiently particularised and clear and it is confusing as to why the respondents assert that they are conclusory and cannot be pleaded to as something that is admitted or denied. Counsel for Mr Li acknowledged that Mr Li's legal team could go through the WeChat messages and itemise the specific allegations as particulars or material facts, but the Substituted Statement of Claim is already over 30 pages long and it will be 60 or 100 pages long if they do that. Counsel for Mr Li questioned whether that would be absolutely necessary for Mr Wang to plead to the paragraph.
4. Counsel for Mr Li submitted, in relation to paragraph 130, that the present case is similar to Haire v WorkCo Australia Pty Ltd (No 2) [2024] FCA 1266 (Haire), where the Federal Court refused to strike out a similar paragraph. Counsel for Mr Li submitted that paragraph 130 goes beyond the paragraph considered in Haire because it provides clear particulars. Counsel for Mr Li submitted that the accessorial liability provision in s 550 of the Fair Work Act requires actual knowledge and paragraphs 128 to 130 of the Substituted Statement of Claim explain the basis on which actual knowledge was inferred. The personal relationship between Mr Li and Mr Wang, and the WeChat messages involving Mr Wang were said to be the most critical of the facts relied upon by Mr Li to establish that Mr Wang had actual knowledge.
5. I consider these paragraphs to be problematic, irrespective of any similarity that Mr Li seeks to draw with Haire.
6. While paragraph 128 on its own is conclusory, it should be read together with paragraph 129, which purports to explain the basis of Mr Li's knowledge. Paragraph 129 may go some way to pleading the basis of knowledge, but it is not wholly sufficient. The only basis on which Mr Wang is said to be directly involved in the operational aspects of MW and the daily management of MW is through his participation in group chats on WeChat and a personal WeChat conversation with Mr Li. It is not apparent from the Substituted Statement of Claim why this knowledge or level of involvement is sufficient to attract the operation of s 550 of the Fair Work Act.
7. The matters in relation to which Mr Wang is said to have direct knowledge refer to many of the alleged contraventions, but not all of them. To give one example, Mr Li pleads in paragraph 115 that MW contravened s 125 of the Fair Work Act by failing to provide him with a copy of the Fair Work Information Statement. Nothing in paragraph 129 addresses any knowledge that Mr Wang is said to have of that allegation, let alone explain how he was involved in the alleged contravention. By paragraph 124 of the Substituted Statement of Claim, this is said to be a serious contravention.
8. Both parties made submissions as to whether it is sufficient to particularise the claim by referring to years' worth of WeChat messages without being more specific. I am not in a position to address whether this would enable Mr Wang to understand the case against him without knowing the volume and nature of the messages.
9. Paragraph 130 is particularly problematic. Paragraph 130.1 purports to plead accessorial liability by using the language of each of the four limbs of the meaning of 'involved in' in s 550(2) of the Fair Work Act. However, in my view, the paragraph is conclusory and fails to plead sufficient material facts for Mr Wang to understand the case against him. It is pleaded that Mr Wang 'aided, abetted, counselled or procured the contraventions', but no act is pleaded that might amount to aiding, abetting, counselling or procuring. Rather, the pleading refers only to Mr Wang's position as an officer and director of MW and being the 'person in the company with the most authority', as well as his knowledge as pleaded at paragraph 129. It is pleaded that Mr Wang 'induced the contraventions, whether by promises or otherwise' through his close friendship with Mr Li and understanding or knowledge of Mr Li's employment with MW. No action that might amount to 'inducing' is pleaded and it is unclear how the matters pleaded might amount to inducement. It is pleaded that Mr Wang 'for the reasons set out at paragraph 128.1 above', by his acts and omissions toward Mr Li 'and others in MW' was directly or indirectly knowingly concerned in the contraventions. There is no paragraph 128.1 and if it is intended to refer to paragraph 128, this simply pleads that Mr Wang was aware of the circumstances of Mr Li's employment and the way in which MW conducted its business. None of the alleged acts or omissions to Mr Li are identified and the reference to acts and omissions to others in MW is entirely unclear. It is pleaded that Mr Wang conspired with others to effect the contraventions, without identifying the acts that are said to give rise to conspiracy.
10. Given the serious nature of the allegations, the pleading fails to put Mr Wang on notice of the case he has to answer and is embarrassing.

1. The respondents submitted that the allegations that each and every contravention pleaded is a serious contravention for the purposes of s 557A by reason of s 557B of the Fair Work Act are serious allegations in relation to which the respondents are entitled to receive clear and precise pleadings of all material facts. They submitted that paragraphs 124 to 127 are not of this kind.
2. The respondents submitted that an immediate difficulty with paragraph 124 is that numerous alleged contraventions are littered throughout the pleading. They submitted that the assertion in paragraph 126 that MW 'expressly, tacitly or impliedly authorised all the contraventions' is no more than a recitation of the statutory text. The respondents acknowledged that on a beneficial reading, the subsequent paragraphs purport to provide some limited explanation as to how MW so authorised the alleged contraventions. However, the respondents submitted that the pleading in this paragraph is circular, unintelligible and leads nowhere.
3. In oral submissions, Counsel for the respondents submitted that the paragraphs are conclusions without reference to material facts.
4. Counsel for Mr Li submitted that to the extent the paragraphs refers to phrases such as 'as pleaded in these pleadings', that is a standard phrase used in pleadings to avoid the need to repeat all the matters that have been referred to in the previous paragraphs. The reader simply has to read the whole claim to determine whether the contraventions are serious or not. That it will take a lawyer some time to read, with an associated increase in cost, is not, in the submission of Mr Li's Counsel, a reason to strike out the statement of claim.
5. I agree with the respondents that the pleadings in these paragraphs are largely conclusory. The language used in paragraph 126 reflects the language in s 557B of the Fair Work Act. The pleading at paragraph 126.3 is too broad to properly put MW on notice of the case it has to meet.
6. There is also some circularity in the pleading insofar as it refers to Mr Wang. Mr Wang's actions, conduct and omissions are said at paragraph 127 to have been engaged in by MW pursuant to s 793 of the Fair Work Act. But, for the reasons explained above in the context of paragraph 130 of the Substituted Statement of Claim, there are no meaningful allegations of actions, conduct or omissions made against Mr Wang.
7. Paragraphs 124 to 127 are liable to be struck out as embarrassing, especially given the serious nature of the allegations.

Submissions relating to delay and other matters going to discretion

1. In responding to the strike out application, Mr Li submitted that he is prejudiced by the delay in bringing the strike out application and that the Court should not grant the application for this reason and because it should be perceived as an attempt to stall the proceedings. Mr Li submitted that he has been unnecessarily accommodating with the provision of further and better particulars to ensure the respondents know the case they have to answer. Mr Li submitted that the respondents' previous representation that they would file a defence indicates that they know the case they have to meet and that the strike out application is a tactical move to delay the filing of a defence because there is no defence. Mr Li submitted that striking out the Substituted Statement of Claim would cause further delay and would be against the overarching purpose of the Court. At the hearing, Counsel for Mr Li suggested that the respondents should be required to file a defence and they can plead a denial to everything if they wish.
2. In oral submissions, Counsel for Mr Li submitted that Mr Li has been forthcoming with the provision of documents in relation to the Statement of Claim, when the respondents originally argued that they needed documents to better understand the claim. The applicant gave everything it has for the respondents to better understand the claim, but the respondents still cannot understand it. The second position of the respondents is that they can understand most of the claim, but cannot understand the serious contraventions. Counsel for Mr Li questioned why this is being raised now, rather than when the Substituted Statement of Claim was received. The Court can be flexible in dealing with these matters, such as ordering the exchange of evidence. Counsel submitted that Mr Li has given all documents already.
3. In response to Mr Li's submission that the applicant has provided further and better particulars when requested to do so by the respondents, the respondents submitted that the particulars do not cure the defects. This has been discussed above, to a degree, in relation to paragraph 112 and the Gallagher case.
4. I have reviewed the affidavit evidence which sets out the various correspondence between the parties. I acknowledge that the original statement of claim was filed some time ago and that there have been communications and an exchange of information between the parties to better assist the respondents to understand the case against them. I take these matters into account in exercising my discretion.

1. I have tried to avoid taking an overly technical approach to pleadings and I have considered whether there may be other tools available to the Court to address the defects I have identified in the Substituted Statement of Claim. On balance, however, I consider that the most appropriate course to strike out the whole of the Substituted Statement of Claim and to give Mr Li an opportunity to replead.
2. One reason for this is the significant number of paragraphs which I have found to be embarrassing. I have considered whether only paragraphs 124 to 130 should be struck out, in accordance with the respondents' alternative position. If I took this approach, other tools could be used to address some of the defects with other paragraphs. However, given the overall state of the pleading and the fact that the provision of documents and particulars has not so far enabled the respondents to understand the case against them, such an approach is likely to lead to more confusion and delay.
3. While I acknowledge the case management concerns raised on behalf of Mr Li, and the pain that may be occasioned by requiring Mr Li to replead his case, a clearer and more concise statement of claim is likely to reduce the future costs of the parties and enable this matter to progress more efficiently. A clearer statement of claim is also more likely to facilitate appropriate admissions and thereby narrow the issues in dispute.
4. While some of the deficiencies in the Substituted Statement of Claim, considered in isolation, could be addressed by way of particulars, Mi Li will now have an opportunity to prepare a new statement of claim. The provision of particulars would most appropriately be done in any new statement of claim.
5. There is no dispute between the parties that, in circumstances where I strike out the Substituted Statement of Claim, Mi Li should be given an opportunity to replead. I propose to hear from the parties as to the length of time they require, or otherwise give the parties an opportunity to confer, before making such an order.

1. The Substituted Statement of Claim will be struck out, with Mr Li having an opportunity to replead his case.

I certify that the preceding one hundred and thirty-one (131) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Ladhams.