Millan v Burswood Resort

Federal Court of Australia|1999-11-26|Before: Nicholson J

REASONS FOR JUDGMENT 1 This is an application for interlocutory relief. The proposed orders seek to restrain the respondent from closing certain offers to employees that an employee entering into an Australian workplace agreement ("AWA") will receive back pay to 16 August 1999 and, further, from restraining the respondent from closing the offer to employees to make the AWA. 2 The interlocutory relief is sought in the context of an application which contains a claim by the applicant for declarations, injunctions and the imposition of a penalty on the respondent pursuant to ss 170VV and 170VZ of the Workplace Relations Act 1996 ("the Act"). The foundation of the relief sought is a claim that the respondent had contravened s 170WG(2) of the Act by knowingly making a false or misleading statement to the members of the employee group with the intention of persuading those persons to make an AWA. 3 Section 170VZ reads: "An eligible court may grant an injunction requiring a person not to contravene, or to cease contravening, this Part". That is a reference to Part 6D of the Act. Section 170WG provides in subs (2): "A person must not knowingly make a false or misleading statement to another person with the intention of persuading the other person to make, or not to make, an AWA or ancillary document".

Background circumstances 4 The applicant is an employee of the respondent. He is a person to whom an offer has been made of an AWA. Although he brings the claim in his own name, he makes the claim on behalf of a group of members who have been similarly affected by the offer of AWAs. However, none of those other persons has joined in the action. 5 The circumstances in which the application is brought and the interlocutory relief now sought are ones which involve some history of disputation among employees of the respondent. Until relatively recently, both the Federated Liquor and Allied Industries Employees Union of Australia, WA Branch, Union of Workers ("the LTU") and also the Australian Liquor Hospitality and Miscellaneous Workers Union, West Australian Branch ("the LHMU") had interests in the workforce of the respondent. Those were divergent interests. 6 The workforce was governed by an industrial agreement which expired on 16 August 1999 but which, however, continues to have force and effect by reason of subs 41(6) of the Industrial Relations Act 1979 (WA) ("the WAIR Act"). 7 On 3 September 1999, a Commissioner of the Western Australian Industrial Relations Commission issued an order having the effect of preventing for the time being the respondent from commencing or becoming a party to any application to the commission to register a new industrial agreement with the LTU. Only the LTU was the union party to the prior and continuing industrial agreement. The order also required the respondent to attempt to conciliate the dispute with the LHMU concerning the proposed new industrial agreement. 8 On 22 September 1999, a ballot of the employees at the respondent's business was declared, which resulted in a majority of the employees who voted favouring the proposed new industrial agreement. 9 On 4 October 1999, a new secretary treasurer assumed office in the LTU. He wrote to the respondent seeking further discussions concerning the proposed agreement. 10 On 7 October 1999, the respondent replied, stating it was prevented by order of the Commissioner from progressing the new industrial agreement. 11 On 12 October 1999, the respondent wrote to its employees. That letter stated the result of the ballot and said the respondent was currently prevented from seeking registration of the new agreement because of the order of the commission. It said that consequently the respondent was unable to have the Commission endorse the employees' pay rise. The letter acknowledged that employees may feel very frustrated with these circumstances and said that the respondent shared their concern. It concluded by stating the respondent was confident it would be able to present the employees with a solution to the conflict shortly. 12 On 13 October 1999, the LHMU wrote to the Commissioner seeking cancellation of the order made on 3 September 1999. On 22 October 1999, the respondent's solicitors also wrote to the Commissioner, the effect of which was to oppose the cancellation of the order. 13 On 26 October 1999, the respondent wrote again to its employees. This is an important document because it is this document by which it is claimed that the respondent has knowingly made a false or misleading statement contrary to subs 170WG(2) of the Act. 14 The letter of 26 October 1999 started by stating: "On 12 October 1999, we wrote to you regarding the difficulties that were facing us in seeking to implement the agreed wage increases and improvements in employment conditions. As noted in our letter, we understand the frustration you have felt at not being able to receive the pay rises that were endorsed by the employee ballot". I describe that as "the first passage" in that letter. 15 In its conclusion in the letter, it was stated: "It is our belief that the use of AWAs will permit those employees who want the pay rise they voted for to receive it, without any further interference from third parties". I call that "the second passage" in the letter. 16 Subsequently, on 29 October 1999, the Commissioner issued an order varying the order of 3 September, the variation having the effect of lifting any prohibition on the registration of an industrial agreement. 17 Those are the essential facts providing the context in which the present application for interlocutory relief arises. I accept the submissions for the applicant that it is necessary to look at the context and to take it into account.

Basis for injunctive relief 18 It is well established in relation to an application for interlocutory relief that two matters must be established. The first is the existence of a serious question or questions to be tried and the second is that the balance of convenience must favour the grant of the interlocutory relief: Epitome Pty Ltd v Australian Meat Industries Employees Union No 2 (1984) 3 FCR 55 at 58. The two items are not entirely unconnected because the strength of the questions to be tried is able to be weighed in the assessment of the balance of convenience: Bullock v. Federated Furnishing of Australasia No 1 (1985) 5 FCR 464 at 472.

Existence of serious question to be tried. 19 I turn, therefore, firstly to whether there is a serious question to be tried. 20 For the applicant it is contended that any fair reading of the first passage of the letter of 26 October 1999 taken in the context which I have outlined is false or misleading because it is to be understood as carrying forward the contents of the letter of 12 October 1999. This, it is said, is false or misleading or will be seen to be such in the resolution of the application, because the consequence is that the employees, including the applicant, had represented to them that the signing of an AWA was the only means by which the respondent could deliver wage increases. 21 That, it is said, is false because the respondent had already agreed to the registration of the proposed new industrial agreement by which the same wage increases would have been paid to employees. It is said that in that context the respondent should be seen as having used as a pretext for not going forward the fact that there had been an order staying the registration of the prior industrial agreement made by the commission. It is said the true facts were that the respondent's continuing refusal to consent to the lifting of the order was the reason for the continuance of it. 22 It is also submitted on behalf of the applicant that these are important circumstances and raise serious questions because any employee to whom an AWA had been offered would enter into it without knowledge of the true facts. However, having entered into it, the agreement would be in existence and he or she would be bound by it. 23 In support of these submissions, it is said for the applicant that this court should follow the approach to subs 170WG(2) of the Act such as that taken by Moore J in Schanka v Employment National (Administration) Pty Ltd [1999] FCA 1334. There, Moore J emphasised the importance of preserving an atmosphere of free bargaining and of not construing s 170WG(1) so narrowly as to exclude from examination conduct occurred during a process of negotiation. That submission is not contested for the respondent and I approach the subsection in the manner which the applicant's case would have the court do. 24 For the applicant's case to raise a serious question to be tried, it is necessary for the first passage in the letter of 26 October 1999 to be able to be read in the manner contended for on behalf of the applicant. In my view, that construction is simply not open. It seeks to draw far too much out of the simple reference in the first paragraph to the fact that in the past, on 12 October 1999, the letter had been written. I accept the submission for the respondent that the sentences in the first paragraph are simply statements of historical fact. I am unable to see any strength in the contention that there can be extracted from that passage the impressions for which the applicant's case contends. 25 This view is strengthened by regard being had to the balance of the letter between the first and second passage in portions which I have not attempted to summarise. It is clear from those passages that what the respondent is stating is that it considers the best method of implementing the wages and conditions package is through the offer of AWAs. It is not the respondent's statement in the letter that the only way for that to be achieved is by AWAs. 26 It is that belief which is reflected in the second passage. Accordingly, there is nothing in the content of that passage, on which the applicant's case relies, which can arguably provide a serious question to be tried. 27 It follows that I am unable to conclude that there are serious questions that the respondent knowingly made a false or misleading statement in either of the two passages relied upon in the letter of 26 October 1999. 28 If I be in error in that view, I would not hold the view that the applicant's case could rise above the level of being a weak one.

Balance of convenience 29 I turn to the balance of convenience. The starting point of course is that there is no strength in the serious questions to be tried to be taken into account in weighing the balance. There are other matters, however, which weigh heavily in the respondent's favour. 30 The respondent has more than 2000 employees. Although the application is brought as a representative one, it is brought by only one employee. The effect of an order of the character sought being granted would be that the respondent would be obliged to keep open its back pay incentive offer. That would have significant commercial impact, as the affidavit of George Wilson sworn 26 November 1999 supports. I do not place reliance in that respect on impact of inconvenience; rather, I place reliance on the impacts relating to the major difficulties of commercial management and cash flow control if an order were made in those terms. 31 Furthermore, the respondent's employees have been informed by various means that the orders which restrain the respondent and the LTU from executing and registering a new industrial agreement have been discharged. It is not necessary to canvas the detail of those communications. I do not accept the submission for the applicant that because those communications occurred after the letter of 26 October 1999 they cannot be taken into account. The relevant thing is that the employees have received those communications prior to the closing date at which they must decide whether or not to accept an AWA. 32 I also accept the submissions for the respondent that, given the context and long history of industrial disputation to which I have previously referred, an interlocutory order of the nature sought would indeed bring uncertainty to industrial relations in this particular workplace. 33 I also take into account that the applicant brings this application on the eve of the closing of the back pay incentive offer. It is apparent, however, that the applicant has known of all the facts giving rise to this alleged cause of action since 26 October 1999. It is argued that I should infer the applicant has chosen to delay. Clearly the application has not been brought as expeditiously as possible and that alone weighs in the respondent's favour in all these circumstances. 34 Other arguments were addressed to me on behalf of the respondent to the effect that in any event the relief sought was not relief which could fall within the compass of s 170VZ. As against that, it was contended for the applicant that once the level of injunctive relief is reached the general powers of the court pursuant to s 23 of the Federal Court of Australia Act come into play and that relief sought could be supported through those powers. In the view which I take of the facts, however, it is not necessary for me to further examine those submissions. 35 It follows from the above reasons that I am of the opinion that the applicant has failed to establish that there are serious questions to be tried or that the balance of convenience favours it. For those reasons, I therefore refuse the application for interlocutory relief. I certify that the preceding thirty-seven (35) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice R D NICHOLSON J.

Associate: Dated: 26 November 1999 Counsel for the Applicant: Mr J W Nolan

Solicitor for the Respondent: Mallesons Stephen Jaques

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Judgment (7 paragraphs)

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