Medcalf v The Greens NSW

Uniform Civil Procedures Rules

1. Rule 4.15 sets out the court's powers to deal with scandalous matter in documents. It reads: "4.15 Court's power to deal with scandalous matter in documents (cf SCR Part 38, rule 8, Part 65, rule 5; DCR Part 30, rule 8, Part 47, rule 7; LCR Part 25, rule 8, Part 36, rule 8) (1) If any matter contained in a document on the court file is scandalous, frivolous, vexatious, irrelevant or oppressive, the court may order: (a) that the matter to be struck out of the document, or (b) that the document be placed in a sealed envelope on the court file, or (c) that the document be taken off the court file. …"
2. Counsel for the defendant referred to Darling v Palm Springs Ltd [2002] NSWSC 793 ("Darling") and Thomas & Ors v SMP (International) Pty Ltd & Ors [2010] NSWSC 822 ("Thomas"). In both these equity cases paragraphs of certain affidavits were struck out prior to the hearing.
3. In Darling, Campbell J referred to Part 38 rule 8 of the Supreme Court Rules 1970 (NSW). Campbell J stated at [35] and [36]: "35 In so far as the Lithgow Valley events were put to him, his response is material which could be relevant to an assessment of what the truth was concerning those Lithgow Valley events. In so far as other matters of complaint were put to him, however, they seem to me to have no relevance. The complaints which were made were that he was incorrectly charging expenses to the company, taking holidays at inappropriate time, and a collection of other complaints about his performance. I cannot see that any of these matters, whether true or not, will assist the court in deciding whether Mr Darling has unclean hands in making his claim for rectification. 36 The second additional type of material which Mr Darling seeks to have struck out is material which is of an introductory or background nature but so remote that it does not affect the probabilities of matters in issue. There were several matters in the present affidavits which go back to events in the eighties; there were events in the nineties which are recounted which lead absolutely nowhere so far as a decision in this case is concerned. It would be a waste of Mr Darling's time and money to have to reply to this material in these circumstances where it leads nowhere. It is appropriate that this type of material is struck out."
4. In Thomas, Pembroke J stated at [9] to [11]: "9 Against the background of that reasonably orthodox structure involving a relatively clearly pleaded statement of the material facts coupled with causes of action that are conceptually recognisable, the plaintiffs seek to read the affidavit of John Leslie Sullivan sworn 15 December 2009. Although certain concessions have been made this morning, to which I will come, I have to say that, to use the most neutral language, that affidavit is inappropriate, confusing and unhelpful. It is a prolix examination of minutiae carried out without any lawyerly discrimination. The majority of it is irrelevant to the resolution of the particular factual and legal issues that I must decide. 10 It can be fairly described as a gallimaufry - difficult to understand and impossible to disentangle. It is a jumble that masks rather than illuminates the facts that are necessary to determine the issues in dispute. The sheer length of the affidavit is oppressive. It consists of 6,657 paragraphs spread over nearly 500 pages. There are 63 pages of detailed objections by the defendants. Page after page explains in agonising detail the life and times of Mr Sullivan, Mr Thomas and Mr Willett. Dozens and dozens of persons who have no serious involvement in the issues for determination are introduced in cameo roles in the narrative. Minor celebrities and rugby league identities feature frequently. Little attempt has been made to meaningfully correlate the narrative recounted in the affidavit with the particular facts that have been pleaded. 11 The affidavit bears the hallmark of a deponent who is deeply imbued with every step and every detail of his own case. It is clear that Mr Sullivan feels that his trust and confidence have been abused and his money taken wrongfully. He may be right. I will be in a position to determine the correctness of his claims when the evidence supporting them has been elicited clearly and rationally."

Background facts

1. It is common ground that the plaintiff had a fixed term of employment with the defendant in the position of executive officer commencing on Monday, 23 June 2014 and ending on 22 June 2016.
2. On 11 November 2015, the plaintiff applied to the Fair Work Commission in relation to a dispute regarding her employment.
3. On 16 May 2016, the parties entered into a deed of settlement and release ("the deed"). Pursuant to clause 2.2(e) of the deed, the defendant was obliged to pay the plaintiff the sum of $91,902.19 and the plaintiff's employment would voluntarily come to an end before the end of the fixed term being 22 June 2016. Hence, the plaintiff was still an employee of the defendant for a period of a further four weeks after the deed was signed.
4. On 18 May 2016, the defendant advised the plaintiff of an allegation that she was guilty of serious misconduct. The alleged serious misconduct constituted a demand to subordinate Greens staff to be paid out an amount of $17,000 for claimed annual leave, in addition to the sum due under the deed, when she was not entitled to it. The sum of $91,902.19 has not been paid to the plaintiff.
5. By letter dated 28 May 2016, the defendant advised the plaintiff that it had determined to terminate her contract immediately.
6. The defendant admits the deed, the termination and the failure to pay money under the deed.

The pleading in the amended statement of claim

1. By amended statement of claim ("ASC") filed 18 October 2016, the plaintiff seeks declaratory relief, specific performance and other relief in respect to the interpretation of the deed of settlement and release. In the alternative the plaintiff seeks to plead the termination of her employment with the defendant as a common law wrongful dismissal. The plaintiff also seeks damages, including aggravated and exemplary damages in relation to the termination of her employment.
2. The ASC sets out the pleadings under a number of topics. They are (A) the parties and the deed; (B) the termination of employment and the requirement for payment per the deed; (C) the plaintiff's appointment to the position as the defendant's executive officer; (D) the plaintiff encounters problems with Mr James Ryan; (E) Mr Ryan's elevation to the position of "Campaign Co-ordinator"; (F) need for variation of the plaintiff's employment contract; (G) the internal ostracism of the plaintiff following the appointment of Mr Ryan to the position of election campaign co-ordinator and the plaintiff's application concerning the enterprise agreement; (H) the unlawful determination of the plaintiff's employment amounting to wrongful dismissal; (I) Mr Greenland's allegation that the plaintiff had instructed the finance officer to pay her more money than what the deed provided for; and finally, (J) the extraneous and improper purpose concerning the termination of the plaintiff's employment and the intentional injury inflicted by the defendant upon the plaintiff.

The affidavits

1. The portions of the affidavits and the reasons that the defendant seeks them to be struck out are as follows.

The affidavit of Carole Medcalf dated 8 January 2017

Paragraphs 40 to 44 (including annexure L)

1. Paragraphs 40 to 44 relate to a complaint made about the plaintiff by another employee of the defendant.
2. The defendant says that these paragraphs are irrelevant as it is not contended that the defendant relied upon the conduct of the plaintiff during her employment until 18 May 2016 as the basis for the termination of the plaintiff's employment on 28 May 2016. The defendant submitted that requiring it to adduce evidence about such conduct is vexatious and oppressive.

Paragraphs 47 to 61 (including annexures N to P)

1. Paragraphs 47 to 61 relate to the plaintiff's appointment, her previous employment, her qualifications and the general performance of the plaintiff.
2. The defendant says that these paragraphs are irrelevant as there is no dispute that the plaintiff was employed or when she was employed. Nor is it in dispute that the plaintiff was previously employed or had qualifications. There is no dispute that the plaintiff and the defendant entered a deed of settlement and release under which the plaintiff would resign her employment. Nor is there a contention that the defendant relied on the conduct of the plaintiff at the time of her employment or at any time during her employment until the alleged incident of 18 May 2016, which was the basis for the termination of her employment. The defendant submitted that leading evidence about the particular circumstances of that conduct and requiring the defendant to adduce evidence in reply is vexatious and oppressive.

Paragraphs 65 to 101 (including annexures Q to R)

1. These paragraphs relate to the plaintiff's relationship with James Ryan and a settlement discussion before the Fair Work Commission. The defendant submitted that there is no contention that the plaintiff's relationship with Mr Ryan and his appointment as campaign co-ordinator was relied upon by the defendant as the basis for the termination of the plaintiff's employment on 28 May 2016 and that the source of funding for Mr Ryan's position is irrelevant to the plaintiff's termination. The defendant says that the resignation of Mr Synge and the filling of the planning and environmental law position also had no bearing on the termination of the plaintiff's employment
2. The defendant submitted that the number of alleged persons involved in the circumstances as set out in paragraphs 65 to 101 are very large and are not relevant, vexatious and oppressive.

Paragraphs 106 to 117 (including annexure I)

1. These paragraphs discuss the plaintiff's alleged ostracism during the election campaign. The defendant submitted that it is irrelevant whether or not the plaintiff was ostracised prior to entering into the deed or prior to her termination. The defendant says that the alleged details of the costs or conduct of the plaintiff's election campaign are irrelevant and scandalous and requiring the defendant to adduce evidence about such matters is vexatious and oppressive.

Paragraphs 124 to 125

1. These paragraphs also relate to Mr Ryan. The defendant submitted that it is not contended that Mr Ryan's non pre-selection for a casual vacancy in the NSW Legislative Council, or the names of his alleged supporters had any bearing on the plaintiff's termination and that the plaintiff and defendant entered the deed and are therefore vexatious and oppressive.

Paragraph 128 (including annexure Y)

1. This paragraph makes reference to the defendant's finances.
2. The defendant submitted that there is no contention that a treasurer's report, provided six months following the termination of the plaintiff's employment, had any bearing on the decision to terminate her employment. The defendant says that the alleged details of the costs or conduct of the plaintiff's election campaign are scandalous, vexatious and oppressive.

The affidavit of Christopher Harris dated 19 January 2017

Paragraphs 18 to 19 (including attachment B)

1. These paragraphs are in relation to the resignation of Mr Harris from his elected positions.
2. The defendant submitted that the resignation of Mr Harris is irrelevant to the decision to terminate the plaintiff's employment and that the hearsay evidence of Mr Harris of the circumstances of the termination is inadmissible. Once again it is not disputed that the plaintiff and defendant entered the deed and as such these paragraphs are irrelevant, vexatious and oppressive.

Paragraphs 20 to 65 (including attachments C to L) and paragraphs 110 to 113 (including attachments CC, DD and EE)

1. These paragraphs relate to the performance of the plaintiff and the finances of the defendant.
2. The defendant submitted that there is no dispute that the plaintiff was employed, or when. Nor is it disputed that the plaintiff and the defendant entered into the deed. It is not contended that the defendant relied on the conduct of the plaintiff at any time during her employment until 18 May 2016, as the basis for the termination of the plaintiff's employment on 28 May 2016. The defendant says that these paragraphs are irrelevant, scandalous, vexatious and oppressive.

The affidavit of Carol Vernon dated 17 January 2017

Paragraphs 10 to 18 (including annexures A to H)

1. These paragraphs relate to the plaintiff's appointment.
2. The defendant submitted that there is no dispute that the plaintiff was employed, or when. Nor is it disputed that the plaintiff and the defendant entered into the deed. It is not contended that the defendant relied on the conduct of the plaintiff at any time during her employment until 18 May 2016, as the basis for the termination of the plaintiff's employment on 28 May 2016. The defendant says that these paragraphs are irrelevant, vexatious and oppressive.
3. The defendant submitted that evidence as to discussions during mediation would be excluded pursuant to s 131 of the Evidence Act 1995 (NSW). This may be correct.

Fair Work Act - costs prejudice?

1. Counsel for the defendant also referred to s 570 of the Fair Work Act 2009 (Cth) that limits the making of costs orders in proceedings arising under that Act.
2. Section 570 of the Fair Work Act reads: "Costs only if proceedings instituted vexatiously etc (1) A party to proceedings (including an appeal) in a court (including a court of a State or Territory) in relation to a matter arising under this Act may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2) or section 569 or 569A. Note: The Commonwealth might be ordered to pay costs under section 569. A State or Territory might be ordered to pay costs under section 569A. (2) The party may be ordered to pay the costs only if: (a) the court is satisfied that the party instituted the proceedings vexatiously or without reasonable cause; or (b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs; or the court is satisfied of both of the following: (i) the party unreasonably refused to participate in a matter before the FWC; (ii) the matter arose from the same facts as the proceedings."
3. In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v ALS Industrial Australia Pty Ltd (No 2) [2015] FCAFC 166; 235 FCR 366, the Full Federal Court held that the limitation on costs is broad. The Full Court stated at [16]: "Even if an applicant makes claims in a proceeding which are founded on common law or other statutory causes of action, the proceeding remains one in relation to a matter arising under the FW Act provided that at least one of its claims arises under that Act..."
4. The limitation applies both to a claim and to a defence where the party relies upon the Fair Work Act: see National Union of Workers v Davids Distribution Pty Ltd [1999] FCA 1109, (1999) 91 FCR 513, 165 ALR 595 at [21].
5. I accept that the plaintiff refers to a breach of an enterprise agreement (ASC [37] and [38]) being an industrial instrument created under the Fair Work Act. The plaintiff claims reasonable notice of termination (ASC [51]). The defendant submitted that this matter is dealt with specifically in s 117 of the Fair Work Act. The defendant raises the enterprise agreement being made under the Fair Work Act. (AD [38(b)]). I also accept that the defendant raises a specific defence under the Fair Work Act as to the doctrine of reasonable notice. (AD 41(iv)). Hence the defendant submitted that it has specifically raised the question of s 570 of the Fair Work Act. (AD [54]).
6. Counsel for the defendant submitted that costs should not be awarded in this case except in the narrow circumstances set out in s 570 of the Fair Work Act. It says that should the matter be left to the trial judge it will have to respond to large slabs of irrelevant material with little chance of having any of the costs of that work being recompensed through the making of a costs order.
7. Overall, the defendant submitted that while the plaintiff has every right to litigate her case, she should not be allowed to do so in a scattergun way when the matter can be narrowly confined. Therefore, the Court should strike out the identified paragraphs.

The plaintiff's submissions

1. The plaintiff submitted that matters of relevance are usually a matter for the trial judge and that it is unusual for a party to seek to have passages of an opponent's affidavit evidence rejected by way of an interlocutory motion. Therefore, the Court should be slow to do so except in the clearest of cases.
2. The plaintiff says that there are clear reasons why the identified paragraphs may be relevant to the facts and issues of this case. The plaintiff has pleaded that the defendant had ulterior and disingenuous motives for terminating her employment. The plaintiff asserts that the defendant contrived a "misconduct" allegation against her two days after agreeing to pay her the sum of $91,902.19 upon the termination of her employment thereby not honouring the deed.
3. The plaintiff pleads that the real reasons for her termination are not those set out in the defendant's termination letter dated 28 May 2016 and that from the appointment of Mr Ryan to the position of campaign co-ordinator and the lodging of her application with Fair Work Australia, she was internally ostracised by the defendant and its committee of management.
4. The plaintiff submitted that she is entitled to put on evidence of the back story relating to issues in her employment prior to the deed and prior to the summary dismissal 10 days later. The plaintiff says that all of this background information helps to inform the Court of the real reasons behind the defendant's decision to summarily terminate her employment and dishonour the deed. According to the plaintiff, the ASC also raises various other issues including the denial of procedural fairness, which is relied upon in terms of there being a requirement upon an employer summarily dismissing a worker to exercise its contractual powers reasonably.
5. Counsel for plaintiff referred to Bartlett v Australia & New Zealand Banking Group Ltd [2016] NSWCA 30. In Bartlett Macfarlan JA (with Meagher and Simpson JJA agreeing) found that Mr Bartlett was entitled to damages for the bank's breach of contract in wrongfully dismissing him. The plaintiff submitted that the identified paragraphs were of the nature that could directly or indirectly affect the assessment of the probability of the existence of one or more of the facts in issue in the proceeding. Those matters include the existence of an ulterior motive for termination and the credibility of the defendant's witnesses. The plaintiff submitted that she has met the test in s 55 of the Evidence Act and the Court should dismiss the defendant's notice of motion.
6. Section 55 of the Evidence Act sets out the evidence that is relevant in proceedings. It reads: "55 Relevant evidence (1) The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding. (2) In particular, evidence is not taken to be irrelevant only because it relates only to: (a) the credibility of a witness, or (b) the admissibility of other evidence, or (c) a failure to adduce evidence."

Conclusion

1. The trial judge in this common law matter has not been allocated to hear this matter. In equity, the trial judges hold pre hearing directions so they are in a position to make interlocutory rulings in proceedings because they will ultimately hear and determine it.
2. Unlike the circumstances in Darling and Thomas, the identified paragraphs in the affidavits filed by the plaintiff cannot, in my view, be described as a gallimaufry. Those paragraphs in my view are not clearly irrelevant.
3. The vice of the arguments put forward by the defendant is its narrow characterisation of the issues in these proceedings, being the termination of the deed and whether there had been serious wilful misconduct on the plaintiff's part. On this narrow point there are credit issues that arise between the plaintiff and the financial officer with the Greens NSW, Suwadee Phiakhaeo. Ms Phiakhaeo's evidence is that the plaintiff allegedly asked her to pay the plaintiff an amount of approximately $19,000 which were moneys that exceed the amount of money that is referred to in the deed. The plaintiff denies ever having made any such request of Ms Phiakhaeo or of any person within the employment of the defendant, or of any other person at all. I might add the issues that relate to credit are permitted to be pleaded pursuant to s 55(2)(a) of the Evidence Act.
4. It is my view that the plaintiff's pleaded case is much broader than the defendant's narrow categorisation of the claim. It covers declaratory relief, specific performance and other relief in respect to the interpretation of the deed or in the alternative, the plaintiff seeks to plead the termination of her employment as a common law wrongful dismissal and that the reasons for doing so were contrived.
5. The topics covered in the ASC included the termination of employment and the requirement for payment per the deed; the plaintiff's appointment to the position as the defendant's executive officer; the plaintiff's problems with Mr James Ryan; Mr Ryan's elevation to the position of "Campaign Co-ordinator"; the need for variation of the plaintiff's employment contract; the internal ostracism of the plaintiff following the appointment of Mr Ryan to the position of election campaign co-ordinator and the plaintiff's application concerning the enterprise agreement; the unlawful determination of the plaintiff's employment amounting to wrongful dismissal; Mr Greenland's allegation that the plaintiff had instructed the finance officer to pay her more money than what the deed provided her; and the extraneous and improper purpose concerning the termination of the plaintiff's employment and the intentional injury inflicted by the defendant upon the plaintiff. The plaintiff and the other deponents address each of the pleaded topics in the ASC in order. I should add that the defendant filed an earlier notice of motion seeking to strike out the statement of claim. As a consequence, the plaintiff repleaded her statement of claim. The defendant has not taken any issue with the pleadings in the ASC. I accept some of the evidence may be ruled as irrelevant but this is best done by the trial judge at the hearing.
6. So far as the defendant's costs argument is concerned, it is not clear that s 570 of the Fair Work Act is applicable. While I agree that the interpretation and breach of the deed falls under the Fair Work Act, the common law allegations may not be considered "in relation to a matter arising under" the Fair Work Act: see Stanley v Service to Youth Council Inc (No 3) [2014] FCA 716, (2014) 225 FCR 357, [2015] ALMD 1588 at [20].
7. I decline to make an order that the paragraphs of the following affidavits be struck out. a. Affidavit of Carole Medcalf dated 8 January 2017: i. Paragraphs 40 to 44 (including annexure L) ii. Paragraphs 47 to 101 (Including annexures N to R) iii. Paragraphs 102 to 104 (including annexure S) iv. Paragraphs 106 to 117 (including annexure I) v. Paragraph 124 to 125 vi. Paragraph 128 (including annexure Y) b. Affidavit of Christopher David Harris dated 19 January 2017 i. Paragraphs 18 to 65 (including attachments B to L) ii. Paragraphs 110 to 113 (including attachments CC, DD and EE) c. Affidavit of Carol Vernon dated 17 January 2017 i. Paragraphs 10 to 18 including annexures A to H).
8. Therefore, the defendant's notice of motion filed 23 March 2017 is dismissed.
9. Costs are discretionary. Costs usually follow the event. The defendant is to pay the plaintiff's costs on an ordinary basis.

The Court orders that: (1) The defendant's notice of motion filed 23 March 2017 is dismissed. (2) The defendant is to pay the plaintiff's costs on an ordinary basis.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 01 June 2017