Consideration
35 The legislative purpose of imposing a duty on an administrative decision-maker to give reasons for a decision in the terms of ss 43(2) and (2B) of the AAT Act or its analogues is remedial. The statutory duty has the purpose of enabling a person affected by the decision to be supplied with findings and a reference to the evidence or other material on which those findings were based so that the person can shape the course of his, her or its future conduct on that basis: Dalton v Deputy Commissioner of Taxation (1986) 160 CLR 246 at 250 per Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ.
36 In Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at 224 [40], Gleeson CJ, Gummow and Heydon JJ said of a statutory duty of a Minister to give reasons:
In any event, the Parliament obliged the Minister, having reached a conclusion, to set out his reasons and, in order to discharge that duty, it was at least necessary for him to express the essential ground or grounds for his conclusion that the prosecutor had not satisfied him that he passed the character test and that the prosecutor's visa should be cancelled.
(emphasis added, footnote omitted)
37 In Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 346 [69], McHugh, Gummow and Hayne JJ said that the purpose of an analogous provision to s 43(2B) of the AAT Act is to require the decision-maker to set out its findings on the questions of fact that it considered to be material, so as to ensure that a person dissatisfied with the result at which the decision-maker had arrived could identify with certainty what reasons were for reaching that conclusion and that a court, asked to review the decision, would be able to identify the decision-maker's reasons and the findings he, she or it made in reaching the decision. They held that a court is entitled to infer that a matter that the decision-maker's statement of reasons did not mention was not considered by the decision-maker to be material. They said:
The Tribunal's identification of what it considered to be the material questions of fact may demonstrate that it took into account some irrelevant consideration or did not take into account some relevant consideration.
(emphasis in original, footnote omitted)
38 In Wonson v Comcare (2020) 276 FCR 613 at 635 [93] (see also at 634 [90]), Katzmann, Anastassiou and Abraham JJ said:
The Tribunal's duty to give reasons in conformity with s 43(2) similarly requires the Tribunal to disclose its path or process of reasoning in sufficient detail to enable a court to see whether it has made an error of law. That will necessarily involve making reference to the findings on material questions of fact and the evidence or other material on which those findings were based, but the duty is not discharged merely by including those references.
(emphasis added)
39 In Repatriation Commission v Holden (2014) 142 ALD 267 at 284 [78], Mortimer J said that the Tribunal's duty to give reasons under s 43(2B) required it to "explain what evidence it has accepted or rejected in making those findings". And, in a well-known passage in Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 280D-F, McHugh JA said that where there is an obligation to give reasons for a decision:
its discharge does not require lengthy or elaborate reasons … But it is necessary that the essential ground or grounds upon which the decision rests should be articulated. In many cases the reasons for preferring one conclusion to another also need to be given.
(emphasis added)
40 However, it is not enough for a decision-maker that he, she or it considered one or more matters, to which a statute requires the decision-maker to have regard, "in the sense of having looked at but discarded them" as Gummow and Hayne JJ held in East Australian Pipeline Pty Ltd v Australian Competition and Consumer Commission (2007) 233 CLR 229 at 256 [102], and see too at 244 [52] per Gleeson CJ, Heydon and Crennan JJ.
41 Brennan CJ, Toohey, McHugh and Gummow JJ explained in Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 272 the role of a court in reviewing an administrative decision. They said:
a court should not be "concerned with looseness in the language … nor with unhappy phrasing" of the reasons of an administrative decision-maker ([Collector of Customs v] Pozzolanic [Enterprises Pty Ltd] (1993) 43 FCR 280 at 287). The Court continued (Pozzolanic (1993) 43 FCR 280 at 287): "The reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error".
These propositions are well settled. They recognise the reality that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed (See McAuliffe v Secretary, Department of Social Security (1992) 28 ALD 609 at 616).
42 Their Honours also affirmed that a judicial review of an administrative decision is concerned with whether the decision-maker acted according to law in making the challenged decision and that this was not a review of the merits of the decision. That is because the merits are the sole concern of the administrative decision-maker under the legislation that the Parliament has enacted. In Plaintiff M64/2015 v Minister for Immigration and Border Protection (2015) 258 CLR 173 at 184-186 [23], [25], 195-196 [59]-[60], French CJ, Bell, Keane and Gordon JJ held that a decision-maker's reasons had to be read fairly as a whole and reemphasised the caution against engaging in merits review that the Court must adopt in reviewing administrative decisions.
43 Here, the Tribunal found the Grand Chapel agreement, and not the 2020 agreement, was the governing instrument for determining Mr Dooley's redundancy pay entitlement for his service prior to his redeployment to Warwick Farm under s 23 of the FEG Act. However, as the Secretary pointed out, that was an agreement between Ovato Print and the AMWU to which none of the employees was party. The document does not suggest that the Union was acting to make a contract on behalf of the employees, or as their agent, albeit that, of course, the Union was representing the interests of employees. Be that as it may, ordinarily, courts have been careful not to translate industrial agreements between an employer and a union as creating legal rights of employees, whom the union represented, against the employer that are enforceable as contractual rights: see, for example, Ryan v Textile Clothing and Footwear Union of Australia [1996] 2 VR 235 at 257-258 per Hayne JA, with whom Brooking and Tadgell JJA agreed, and Hanlon v Refined Sugar Service Pty Ltd [2002] FCA 1395 at [24] per Emmett J.
44 Although the Grand Chapel agreement was expressed in terms that may appear similar to a contract, including its description as an 'agreement', in the absence of evidence and findings as to its creation, purpose and what it dealt with, it is difficult to characterise it as intended to give rise to contractual relations between Ovato and the AMWU.
45 In Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 at 105 [24]-[25], Gaudron, McHugh, Hayne and Callinan JJ said:
24 "It is of the essence of contract, regarded as a class of obligations, that there is a voluntary assumption of a legally enforceable duty." (Australian Woollen Mills Pty Ltd v The Commonwealth (1954) 92 CLR 424 at 457, per Dixon CJ, Williams, Webb, Fullagar and Kitto JJ) To be a legally enforceable duty there must, of course, be identifiable parties to the arrangement, the terms of the arrangement must be certain, and, unless recorded as a deed, there must generally be real consideration for the agreement. Yet "[t]he circumstances may show that [the parties] did not intend, or cannot be regarded as having intended, to subject their agreement to the adjudication of the courts" (South Australia v The Commonwealth (1962) 108 CLR 130 at 154, per Windeyer J).
25 Because the inquiry about this last aspect may take account of the subject matter of the agreement, the status of the parties to it, their relationship to one another, and other surrounding circumstances (South Australia v The Commonwealth (1962) 108 CLR 130 at 154; Placer Development Ltd v The Commonwealth (1969) 121 CLR 353 at 367, per Windeyer J), not only is there obvious difficulty in formulating rules intended to prescribe the kinds of cases in which an intention to create contractual relations should, or should not, be found to exist, it would be wrong to do so. Because the search for the "intention to create contractual relations" requires an objective assessment of the state of affairs between the parties (Masters v Cameron (1954) 91 CLR 353 at 362, per Dixon CJ, McTiernan and Kitto JJ; ABC v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540 at 548-549, per Gleeson CJ) (as distinct from the identification of any uncommunicated subjective reservation or intention that either may harbour) the circumstances which might properly be taken into account in deciding whether there was the relevant intention are so varied as to preclude the formation of any prescriptive rules.
(emphasis added)
46 Moreover, in the context that both the 2020 agreement and the Grand Chapel agreement were made in an industrial context, it was important to have regard to the industrial purpose of each together with its respective commercial and legislative purposes as well as to the terms of the particular document as a whole: Energy Australia Yallourn Pty Ltd v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union (2018) 264 FCR 342 at 356-357 [56] per Rares and Barker JJ citing Kucks v CSR Ltd (1996) 66 IR 182 at 184 per Madgwick J.
47 Here, the obvious questions are what was the purpose of, subject matter of, and the consideration for, the "agreement" and how could the AMWU or an employee enforce it? The fact that the Grand Chapel agreement was not incorporated into either the 2018 or 2020 agreements would suggest that the AMWU and Ovato group did not intend it to be enforceable directly under the Fair Work Act.
48 The Tribunal had a body of evidence before it to which it did not refer in its reasons that may or may not have enabled it to come to the conclusion that it ultimately reached, namely that the governing instrument for Mr Dooley's entitlement to redundancy pay was the Grand Chapel agreement. But, in order to do so, it was essential that the Tribunal resolve at least one of the issues that it recorded that the Secretary had raised from the minutes taken by the AMWU of their meeting with Mr O'Connor on 21 March 2019, namely that:
Any MK [scil: Moorebank] staff that move to WF [scil: Warwick Farm] will have their redundancy calculation at the time of transfer grandfathered. This was designed to deal with staff who had worked on night shift for many years at MK [scil: Moorebank] and changed shift when moving to WF [scil: Warwick Farm] which would reduce value of redundancy (Agreed)
(emphasis added)
49 Yet, the Tribunal did not address this contextual statement of the purpose, presumably known to both Mr O'Connor and Ms Cassin when they "agreed" about the "grandfathering" or "freezing" of something to do with redundancy payments. Contracts are not made in a factual vacuum and their meaning can be, and often is, illuminated by what a reasonable person in the position of the parties would have understood from the words of the contract having regard to the surrounding circumstances, the aim, genesis and purpose of the agreement known to both parties: Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 462 [22] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ.
50 In the context known to the parties at the time at which the Grand Chapel agreement was struck on 21 March 2019, the Commission had approved the 2018 agreement just days earlier. It was binding on all of the employees, the PMP companies and the two unions by force of ss 51 and 52 of the Fair Work Act. Thus, there could be no doubt that all employees across the PMP group sites covered by the 2018 agreement were entitled to have uncapped redundancy pay based on four weeks' pay for every year of service, as provided in cl 22.8, and that shift loadings would be calculated on a base rate. As noted above, there may have been a difference in the calculations applicable to staff at Warwick Farm or who moved there and were to be assigned to different shifts as compared to those applicable to them or the shifts they worked at Moorebank. But, the question for the Tribunal was to what did the Grand Chapel agreement refer in the words "Grandfather / freeze redundancy entitlement for redeployed employees as at date of transfer"?
51 The Tribunal did not explain how the Grand Chapel agreement came to have the binding force of continuing in effect even after at least the majority of Ovato group's work force had voted in accordance with the requirements of the Fair Work Act to approve the 2020 agreement with the understanding that, if they approved it, it would significantly reduce their previous entitlements on redundancy. In particular, the Tribunal did not explain what the agreement in the Grand Chapel agreement was, who the parties to it were and how it came, as matter of contract, or because of a statutory foundation, to create a legally enforceable right that an employee in Mr Dooley's position could enforce.
52 In addition, the Tribunal had the evidence, to which it referred in par 20 of its reasons, where Mr Slaven had explained to employees how the draft 2020 agreement would affect their rights, and the explanatory document for that draft that gave an explanation under the heading 'Grandfathering of MBK [scil: Moorebank] packages?' that I have quoted at [18] above.
53 It was not sufficient for the Tribunal simply to assert, as it did, that the 2020 agreement did not contain or should have contained words that excluded the Grand Chapel agreement from operating. It mischaracterised its task in par 46 of its reasons by asking whether the 2020 agreement, properly interpreted, was inconsistent with the Grand Chapel agreement or whether that latter agreement could be honoured consistently with the 2020 agreement. The 2020 agreement's provisions relating to redundancy were directly inconsistent with previous corresponding provisions in cl 22 of the 2018 agreement because they were significantly reduced from payments of four to two weeks' pay for every year of service: East Australian Pipeline 233 CLR at 244 [52], 256 [102] per Gummow and Hayne JJ, Wonson 276 FCR at 635 [93] per Katzmann, Anastassiou and Abraham JJ, Soulemezis 10 NSWLR at 280D-F per McHugh JA.
54 The Tribunal did not make any findings about what the terms of the Grand Chapel agreement were, other than its general statement about redundancy payments. The Tribunal needed to make findings and give reasons for doing so as to what the particular terms of the Grand Chapel agreement were in circumstances where there was conflicting evidence and submissions about what was being grandfathered or frozen concerning redundancy payments that was not otherwise already covered by the 2018 agreement. The Tribunal failed to identify or explain in a reasoning process how the arrangement reflected in the Grand Chapel agreement between the AMWU and Ovato group enabled an employee in Mr Dooley's position to assert that it was a binding agreement and why they would have applied it to a subject already addressed in the 2018 agreement, namely the entitlement to four weeks' pay for every year of service. It did not explain why it found this was the subject of the grandfathering or freezing rather than something not addressed in the 2018 agreement (such as allowing transferring employees who moved to a less well paid shift at Warwick Farm to have their redundancy pay calculated on their previous rate of pay at Moorebank) which an employee could enforce, especially given its inconsistency with the 2020 agreement.
55 In order to understand what the terms of the Grand Chapel agreement were and what they meant, it was necessary for the Tribunal to construe it from the objective position of a reasonable person in the position of the parties and in the industrial context in which they found themselves and then to make findings and express a reasoning process to explain, first, how the Grand Chapel agreement created binding rights which were enforceable at the suit of an employee, such as Mr Dooley, secondly, precisely what those rights were and, thirdly, why it arrived at the construction that it did.
56 While the identification of the terms of a contract involves questions of fact, construction or application of those terms in any particular situation, so as to effect legal rights, is a question of law: see Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 260 CLR 1 at 14 [27]-[28] per French CJ, Kiefel and Bell JJ, 40 [131] per Keane J.
57 Because of the absence of any findings, and a reference to the evidence on which they were based, about what the terms of the Grand Chapel agreement were, beyond the Tribunal's assertion that they somehow, and for no identifiable purpose, grandfathered or froze what was already in the 2018 agreement about the use of four weeks' pay for each year of service to calculate redundancy pay, it is not possible to find that the ultimate result at which it arrived was not open to it.
58 There was evidence before the Tribunal that might have enabled it to find that Ovato had made some (unspecified) representation in the Grand Chapel agreement that had been communicated to employees, and, in particular, Mr Dooley, at the time it was made and that it comprised some form of offer, capable of acceptance by all the world, such as in Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256. However, the Tribunal did not make any findings or identify any evidence as to how Mr Dooley could be able to assert legal rights under the Grand Chapel agreement, and what those rights were, consistently with the industrial context in which the 2018 and 2020 agreements gave him and Ovato's other employees enforceable rights to redundancy pay under the Fair Work Act.
59 The Tribunal seems to have taken the view that the Grand Chapel agreement was and remained binding on employees and Ovato, despite the Fair Work Act entitling the Commission to approve the 2020 agreement, pursuant to being satisfied of the matters in ss 186-188, including that the employees genuinely had agreed to the 2020 agreement as required by ss 186(2) and 188. The 2020 agreement had the legal effect, in common with many other instances throughout Australia, of reducing employees' entitlements (with their agreement, by majority) because of the significant economic impacts on business as a result of the COVID-19 pandemic and lockdowns in many parts of Australia. Yet, the Tribunal asserted, without a reasoning process or fact finding, that somehow, at the time of approving the 2020 agreement, the Commission and the parties intended to leave extant the Grand Chapel agreement to override cl 22.7 of the 2020 agreement despite it significantly reducing the employees' redundancy entitlements. The Tribunal seems to have thought that it could act as it did because of what it described as "the essential nature of justice is informed by fairness no less than by hard reason".
60 In my opinion, the Tribunal failed to give any adequate reasons in accordance with its obligation under s 43(2) and (2B) of the AAT Act. It did not specify sufficient findings on material questions of fact and references to the evidence or other material on which those findings were based to enable a reasonable person to understand how it arrived at its conclusion that the Grand Chapel agreement was within the definition of 'governing instrument' under s 5 of the FEG Act so that it could have conferred a legal right that Mr Dooley could enforce. The Grand Chapel agreement was not any of the matters in pars (a), (b) or (d) of the definition, at least on the Tribunal's findings, to which Mr Dooley was a party and therefore gave him a redundancy pay entitlement. Although the Grand Chapel agreement might be capable of being described as a "written instrument" within par (c) of that definition, the Tribunal did not give reasons as to how that agreement applied as a governing instrument in the industrial context known to all parties by the time the Commission approved the 2020 agreement with the deliberate purpose voted on by the majority of employees of reducing their redundancy entitlements.
61 In my opinion, because the 2020 agreement significantly reduced the redundancy entitlements of all employees from their rights under the 2018 agreement, the Tribunal's reasons failed to make findings and identify the evidence it considered relevant to its asserted conclusion. It is impossible to understand from its reasons how the Tribunal arrived at its decision because it gave none about what were the terms of the Grand Chapel agreement and what they meant, did not explain how it arrived at its construction of whatever it was that the terms of that agreement contained in the context of the circumstances of the parties at the time.
62 However, it is not appropriate to make a finding, as sought by the Secretary, that the Grand Chapel agreement could not have been a governing instrument applicable to Mr Dooley's redundancy pay entitlement for the purposes of the FEG Act because of the Tribunal's failure to discharge its obligation properly to give reasons, make findings of fact and provide a reasoning process for its conclusion adequate to enable one to understand how it arrived at what, on its face, does not seem to be a logical conclusion on the limited factual material to which I have referred, which was not the whole of the facts before the Tribunal. The problem is that the Tribunal failed to make findings of fact in its reasons, including about Mr Dooley's evidence as to how he said the Grand Chapel agreement gave him rights, or what those were, or about anything that the witness he called said that he thought supported his account.