Minimum Conditions of Employment Act 1993 (WA), s 33, s 38

Brackenridge v Toyota Motor Corporation Australia Ltd (1996) 142 ALR 999

The Burton Group Ltd v Smith (1977) IRLR 351

Thickbroom v Newcastle Wallsend Coal Co Pty Ltd (1989) 83 IR 193

B G Gale Ltd v Gilbert [1978] ICR 1149

CFMEU v Oakbridge Pty Ltd, unreported; FedCt of NSW; 556 of 1998; 27 July 1998

Chapman v Christopher Ltd [1981] IRLR 440

Dalgety Australia Ltd v Rubin, unreported; SCt of WA; Library No 5485; 24 August 1984

Easling v Mahoney Insurance Brokers Ltd [2001] SASC 22; (2001) 78 SASR 489

Fryar v Service Systems Pty Ltd (1996) 137 ALR 321

Hospitals Contribution Fund of Australia v Hunt (1984) 44 ALR 365

Kimberley Downs Pty Ltd v Western Australia, unreported; SCt of WA; Library No 6414; 25 August 1986

Morton Sundour Fabrice Ltd v Shaw [1967] 2 ITR 84

Thomson v Orica Aust Pty Ltd [2002] FCA 939; (2002) 116 IR 186

1 MASTER SANDERSON: This is the return of two chamber summonses. The first in time is the plaintiff's chamber summons seeking to strike out the defence. Subsequent to the issue of that chamber summons, the defendant lodged a minute of proposed reamended defence and a chamber summons seeking leave to amend in terms of the minute. At the hearing, counsel were content to proceed on the defendant's chamber summons - it being implicit that the original defence required amendment. During the course of argument, counsel for the defendant conceded that further amendment to the defence was required. Subsequent to the hearing, a document entitled "Further Amended Defence was filed. Both counsel indicated they were content that the issues between the parties had been fully ventilated and the question of whether leave to amend in terms of the further amended defence could be determined without oral argument. The question, then, is whether leave ought be given to the defendant to amend in terms of the further amended defence (which I will refer to as the "minute").

2 As a consequence of discussions between the parties, the ambit of the dispute had been narrowed down to one paragraph in the minute. To understand the issue between the parties, it is not necessary to say much about the background facts and the nature of the dispute. It is sufficient if I say that the plaintiff was at one time employed by the defendant and her employment was terminated. She is suing for damages for breach of her employment contract.

3 The paragraph in the minute which is the subject of this dispute is par 11. It is in the following terms (I have omitted all of the marking-up and the deletions from the previous defence):

"11. The defendant denies the allegations in paragraph 9 of the Further Re-Amended Substituted Statement of Claim and says that on or about 27 September 2002 the plaintiff was given 12 months notice of the termination of the Employment Contract (the 'Notice Period') and says further that the Employment Contract terminated on or about 11 September 2003, by reason of the matters set out in paragraph 11A below, alternatively on or about 29 September 2003 by effluxion of the Notice Period.

(a) On or about 15 April 2002 the plaintiff was informed at a conference of managers of the defendant in Sydney that the position of Financial Services Manager Woolworths Supermarkets WA would cease to exist by October 2002.

(b) The plaintiff had discussions with Tony Parle on behalf of the defendant in or around May, June and August 2002 the effect of which was to reaffirm that the plaintiff's position of Financial Services Manager Woolworths Supermarkets WA would cease to exist by October 2002.

(c) On 27 September 2002 the Plaintiff went on a period of 12 months unpaid parental leave pursuant to s33 of the Minimum Conditions of Employment Act 1993 (WA) and the terms of the Employment Contract pleaded at paragraph 8A above, the period of leave commencing on 30 September 2002 with the plaintiff due to return to work on 29 September 2003;

(d) By reason of the matters set out in subparagraphs 11(a) to 11(c) above in or about 30 September 2002 the plaintiff commenced 12 months unpaid parental leave from the defendant with the certain knowledge that the position of Financial Services Manager Woolworths Supermarkets WA no longer existed and would not be open to her on her return so that on her return her Employment Contract would then terminate, and that her relationship of employment with the defendant would also end on her return, unless she accepted an alternative position with the defendant;

(e) The plaintiff was either unwilling to accept an alternative position or alternatively, was unwilling to accept any of the alternative positions with the defendant available to her; and

(f) The plaintiff voluntarily returned from parental leave on 1 September 2003 and received all pay and entitlements under the Employment Contract until 11 September 2003."

4 The first thing to note about par 11 is that material facts are pleaded as particulars. If this was a case where notice had been given on a particular day by an officer or agent of the defendant to the plaintiff, then a plea to that effect would be a plea of the material fact. Particulars of the material fact might then be provided. For instance, if the notice was contained in a letter written for and on behalf of the defendant and sent to the plaintiff, then that letter would be appropriately referred to in the particulars. But where, as here, the notice might be described as "constructive notice", the events that took place which lead to the conclusion that notice was given are material facts and ought be pleaded as such. For instance, par 11(a) is clearly a plea of material fact; it is not a particular. Of course, the description in the pleading of material fact as "particulars of notice" does not render the material fact as particulars. But it is confusing and it is bad pleading practice. Whatever else might be said of the pleading, its form is open to criticism.

5 The meaning and intent of par 11 is not easy to understand. It comprises a number of elements. First it is said that, on or about 27 September 2002, the plaintiff was given 12 months' notice of the termination of the employment contract. There is then a reference to the employment contract being terminated on 11 September 2003 by reason of the matters set out in par 11(a). With respect, that is rather a confusing way to plead what must be alternatives. Leaving that criticism to one side, the defendant then says that the contract of employment came to an end on 29 September 2003 "by the effluxion of the Notice Period". In other words, the plea is that the plaintiff received 12 months' notice on 27 September 2002 and her employment terminated at the conclusion of that notice period on 29 September 2003.

6 By par 11(a), it is said that, on 15 April 2002, the plaintiff was advised that the position of Financial Services Manager Woolworths Supermarkets WA (the position she occupied) would cease to exist "by October 2002". It is difficult to see how that paragraph is relevant to anything. But it can be assumed that it is a plea of background facts which relates to the giving of the notice on 27 September 2002. On that basis, the plea can stand.

7 Paragraph 11(b) is not relevant to anything. Even assuming that the discussions referred to took place, those discussions could not add to the fact situation as it existed after 15 April 2002. So par 11(b) has no relevance and ought not be in the pleading.

8 Paragraph 11(c) deals with the fact that the plaintiff, on 27 September 2002, took 12 months' unpaid parental leave. She was due back to work on 29 September 2003. That paragraph pleads material facts (which I understand from the submissions is not in dispute) and is clearly a proper plea.

9 It is worth pausing at this point to examine whether what is pleaded in par 11 is consistent with the plea in par 11(a) and 11(c). Clearly, it is not. In par 11, it is pleaded that the defendant gave the plaintiff notice on 27 September 2002. In par 11(a), it is pleaded that, on 15 April 2002, the plaintiff was informed that her position would cease to exist. On 27 September 2002, so it is pleaded in par 11(c), the plaintiff went on 12 months' parental leave. Thus, there is nothing in pars 11(a) or (c) which would support a plea that notice was given on or about 27 September 2002. It is to be assumed, then, that the position will be clarified by pars 11(d) through to (f). Against that background, it would seem that par 11(d) pleads some form of constructive notice. The date referred to in par 11(d) is 30 September 2002. Why, then, there should be a plea in par 11 of "on or about 27 September 2002" is unclear. It is also confusing. Paragraph 11(d) also seems to embody two separate concepts. On the one hand, what is said is that, as at 30 September 2002, the plaintiff knew that when she returned after parental leave, her position would no longer be open "so that on her return her Employment Contract would then terminate". That plea deals with when and why, on the defendant's case, the contractual relationship between the parties would come to an end. On the other hand, reference is made to the "relationship of employment". It is said that her relationship of employment would also end on her return "unless she accepted an alternative position with the defendant." These two aspects of par 11(d) require further discussion. However, it is convenient first to deal with the remaining pleas found in par 11(e) and (f).

10 Paragraph 11(e) is unexceptionable. It pleads a material fact that the plaintiff did not accept an alternative position with the defendant. That is the material fact and that is what should be pleaded. The use of the word "unwilling" is unhelpful, but does not work such mischief as to require its being struck out.

11 Paragraph 11(f) pleads that the plaintiff returned from parental leave on 1 September 2003 and was paid "under the Employment Contract" until 11 September 2003. That is a plea that is irrelevant to the case being made by the defendant. On the defendant's case, notice was given on 27 September 2002 (or 30 September 2002 if the plea in par 11(d) is preferred) and was to expire 12 months later. That means that the employment contract would terminate at the end of September 2003. That being so, what is pleaded in par 11(f) is irrelevant to the employment contract. If the plea is directed in some way at the termination of the relationship of employment - a relationship which is said in par 11(d) to end on her return to work rather than at the end of September 2003 - then some further plea would be required. At present, par 11(f) is left hanging and is of no relevance. It should be omitted.

12 It is appropriate, then, to return to this question of the distinction to be drawn between an employment contract and an employment relationship. This distinction is well recognised in employment law, although it is rarely a matter of concern. In Brackenridge v Toyota Motor Corporation Australia Ltd [1996] IRCA 628; (1996) 142 ALR 99, the Full Court of the Industrial Relations Court of Australia had reason to consider the distinction. The facts of the case were that the appellant had been demoted from her position with the respondent. The appellant contended that her demotion amounted to a termination of employment and sought both reinstatement and compensation for an alleged unfair dismissal. The Court (Wilcox CJ, von Doussa and Marshall JJ) put the position in this way, at 101:

"As will appear when we turn to the contractual claims in this case, we are of the opinion that the decision by Toyota to demote Ms Brackenridge involved a termination of her contract of employment as it chef supervisor. However, for the purpose of Div 3 of Pt VIA of the Industrial Relations Act, the relevant question is not whether there was a termination of the contract of employment but whether the applicant suffered 'termination of his or her employment': see s 170EA(1) of the Act. There is a conceptual difference between the two situations: see Siagian v Sanel Pty Ltd [1994] IRCA 2; (1994) 1 IRCR 1 at 13 - 20. Ordinarily, the conceptual difference does not matter: dismissal will ordinarily terminate both the particular contract of employment and the employment relationship. In this case, however, Ms Brackenridge continued to be employed by Toyota after 3 February 1995. The employment relationship continued albeit under a new contract of employment."

13 The difficulty with this present case is that it involves a rather unique fact situation. Assume for a moment that, pursuant to matters pleaded in par 11(a), the defendant gave the plaintiff notice of termination of her employment to take effect on 30 September 2002. (Lest there should be any misunderstanding in putting forward this assumption, I should make two points immediately. First, there is no plea that the defendant gave the plaintiff notice on 15 April 2002 that her employment was to come to an end on 30 September 2002. Rather, it is pleaded that notice was given to her either on or about 27 September 2002 (par 11), or on 30 September 2002 (par 11(d)). Second, the plaintiff says that, even on the most benign view of the pleading, the date upon which the plaintiff's employment was terminated was uncertain. It is submitted that that being so, no effective notice could have been given and the plea of such notice is bad. I will deal with that issue later in these reasons.)

14 Leaving to one side the prospect of other defects in the notice, the plaintiff's employment contract and her employment relationship would both have come to an end on 30 September 2002. The fact that there is a difference between the concepts of an employment contract and an employment relationship are of no consequence.

15 But what happened here is that the plaintiff decided to take parental leave. That she was entitled to do under s 33 of the Minimum Conditions of Employment Act 1993 (WA) ("the Act"). Her return to work after parental leave was governed by the provisions of s 38 of the Act. It is in the following terms:

"38. Return to work after parental leave

(1) On finishing parental leave, an employee is entitled to the position he or she held immediately before starting parental leave.

(2) If the position referred to in subsection (1) is not available, the employee is entitled to an available position -

(a) for which the employee is qualified; and

(b) that the employee is capable of performing,

most comparable in status and pay to that of his or her former position.

(3) Where, immediately before starting parental leave, an employee was acting in, or performing on a temporary basis the duties of, the position referred to in subsection (1), that subsection applies only in respect of the position held by the employee immediately before taking the acting or temporary position."

16 What, then, is the effect of s 38 of the Act in the circumstances of this case? Before answering that question, it might assist to look at what would be the case in the circumstances I have postulated - that is, assuming notice had been given on 15 April 2002 with the employment contract to terminate on 30 September 2002 with the plaintiff deciding to take parental leave on 27 September 2002. The answer to that question depends on whether or not what is preserved by s 38 is the employment contract or the employment relationship. The answer may be that the section affects both, depending upon the particular facts of the case. If the employee's former position is available, then s 38(1) will apply and the employment contract will continue on. If that position is not available, then the employment contract must have come to an end. However, s 38(2) requires that the employment relationship must continue with the employee being offered an alternative position and consequently a new employment contract. The alternative argument is that s 38(2) of the Act retains the contractual relationship with the contract varied to allow for the different positions held by the employee before and after the parental leave. That latter analysis does not sit happily with the Brackenridge decision, but for present purposes it is not necessary to determine whether or not such an argument is open.

17 The difficulty for the defendant in this case is to determine what effect s 38 has on any period of notice. On a pleading summons, it is inappropriate for me to attempt to answer that question. What can be said is that, based upon what is pleaded in par 11(d), the defendant has apparently decided that the plaintiff's decision to take parental leave, coupled with the knowledge that her position "would cease to exist by October 2002" means that notice was given on either 27 or 30 September 2002. There is no logical reason why that should be so. It would doubtless be arguable that the effect of any notice given on 15 April 2002 was to bring the employment contract to an end on 30 September 2002. That would not, I think, be inconsistent with s 38 of the Act. The employment relationship would then continue. How and when and, indeed, if that relationship came to an end would need to be pleaded.

18 As can be seen from what I have already said about this matter, it is clear that the pleading in its present form cannot stand. It is, with respect, confusing and does not appear to have any sound jurisprudential base. It is also clear that, with further consideration, it may be possible to plead a defence along the lines put in par 11. For that reason, the defendant should have leave to replead.

19 As I have indicated above, the plaintiff maintained that par 11 was bad in any event, because it did not plead notice which was certain. It was the plaintiff's contention that if the notice did not specify a certain period, it could not be effective and could not be relied upon by the defendant. In support of that proposition, reference was made to two decisions. The first was The Burton Group Ltd v Smith (1977) IRLR 351 and the second was Thickbroom v Newcastle Wallsend Coal Co Pty Ltd (1998) 83 IR 193. Based upon these two decisions, it would seem that a notice of termination is only effective if the party receiving the notice is advised as to the date on which the employment will terminate, or is able to ascertain that date by reference to the terms of the letter. Thus, by way of example, in Thickbroom a notice was held not to be effective because it was conditional upon the happening of the outcome of a particular event. In this case, the plaintiff says that the plea in par 11 as it stands suffers from uncertainty. It is submitted that advice that the plaintiff's position would cease to exist by October 2002 cannot amount to valid notice such as to bring the contract of employment to an end.

20 As I have already indicated, there are, in my view, difficulties in ascertaining from the present pleading when it is said notice was given and when it is said the plaintiff's employment was to come to an end. However, if the defendant says that the specified date for the termination of the employment was October 2002, because the plaintiff's position would cease to exist, then there is raised a question of fact to be determined at trial. The question can be put in this way: Did the notice state with sufficient certainty the date upon which the plaintiff's employment was to come to an end? In my view, it would be open to the defendant to raise that question and the alleged lack of certainty in the notice would not be sufficient to refuse to allow the plea to be made.

21 In summary, then, I would not allow the defendant to amend in terms of the present par 11. I would, however, allow the defendant a further opportunity to replead the matters raised in that paragraph.

22 Before leaving this matter, I wish to make some general comments about strike-out applications. This case well illustrates the difficulty facing counsel and a Master when an application is made to strike out a particular and limited section of a pleading. On the one hand, it might be considered an unnecessary interlocutory diversion which wastes both time and money. This is a case dealing with the alleged breach by the defendant of the plaintiff's employment contract. The facts, so far as they relate to the termination of the plaintiff's employment, are not seriously in dispute. Even allowing for the difficulties with par 11, why bother to strike it out? Counsel for the plaintiff conceded that par 11A would stand and that paragraph would require evidence which would bear directly upon the matters raised in par 11. In other words, the absence of par 11 from the pleading would make no difference at all to the way in which the trial was conducted. Nor, with respect, could the plaintiff and her legal advisers have had any doubt as to the nature of the claim put against them in par 11. They could not possibly have been taken by surprise at trial.

23 On the other hand, par 11 is clearly defective and is not a proper plea. Generally speaking, defective pleas ought be struck out and if the pleader will not concede the point, then the matter ought be put before a Master. One can imagine counsel at trial who points out the logical inconsistency or the inadequacy of a paragraph of the defence being subject to criticism by a Judge for not moving to strike the paragraph out. Counsel is placed in an invidious position.

24 Much the same can be said about the position of the Master hearing the matter. If counsel wants to plead a matter in a particular way, albeit in a manner that is defective when no false issue is raised and where the defects are not likely to delay the trial or increase the costs, why should the paragraph be struck out? Is there any purpose to be served in having a Master dance on the head of a pin to finetune a pleading? Or is the better option to deal with the matter so as to confront the parties with the real issues if for no other reason than, when it comes time to mediate the claim, each party will know with precision where they stand?

25 These are not easy questions. They are inevitably raised when counsel considers an opponent's pleading and decides whether a strike-out application ought be made. It is clear that overwhelmingly counsel moves to strike out. That approach has led to what might be described as an epidemic of pleading summonses. It has bedevilled litigation in this Court for years. As a consequence, pleading summonses clog up Masters' lists and occasion delay and expense to the detriment of all parties.

26 Against that background, it seems to me that this was a summons that ought not have been brought. In saying that, I am intending no criticism of counsel or the solicitors concerned. After all, I have determined that par 11 is defective and leave to plead in those terms ought not be granted. The position of the plaintiff's advisers has been vindicated. But, one might ask, to what end? Will the plaintiff have gained any advantage either materially or tactically? I think not. The deficiencies in this pleading could have been pointed out to the defendant's solicitors in correspondence (as they most likely were) and reiterated at the inevitable mediation conference. If the defendant saw fit to maintain its position through to trial, and the trial Judge pointed out the difficulties with the plea, counsel for the defendant could have referred to correspondence highlighting the deficiencies and explained the reasons for not taking out a pleading summons. Given the robust attitude taken by Judges to adjournments of trial these days, it is a fair assumption that the only party embarrassed by the defect pleading would have been the defendant. The almost three months which has passed since the date of the issue of this summons would not have been lost to the plaintiff.

27 I will hear the parties as to the precise form or orders and as to costs.