Sweeney & Vandeleur Pty Ltd and anor v Robert Angyl and ors - [2004] NSWIRComm 194 - NSWIRComm 1997 case summary — Zoe

NSWNSWIRComm

Sweeney & Vandeleur Pty Ltd and anor v Robert Angyl and ors

[2004] NSWIRComm 194

Industrial Relations Commission (NSW)|1997-06-20|Before: Haylen J, Wright J, Hungerford J, Peterson J

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Source facts

Court

Industrial Relations Commission (NSW)

Decision date

1997-06-20

Before

Haylen J, Wright J, Hungerford J, Peterson J

Source

Original judgment source is linked above.

Judgment (43 paragraphs)

[1]

Industrial Relations Commission of New South Wales in Court Session

[2]

CITATION : Sweeney & Vandeleur Pty Ltd and anor v Robert Angyl and ors [2004] NSWIRComm 194 PARTIES : Sweeney & Vandeleur Pty Ltd and anor v Robert Angyl and ors FILE NUMBER: IRC No 2951 of 2004 CORAM: Haylen J Industrial Relations Act 1996 s 106 - unfair contract - interlocutory relief sought by notice of motion - consideration of nature of power to grant interlocutory relief - whether damages will usually provide adequate relief - dispute arising in administration and operation of barristers' chambers - work alleged to be performed by counsel and chamber's employees - whether arguable case for substantive relief - balance of convenience - peculiar nature of relationship and its breakdown a discretionary consideration - interlocutory orders refused. CATCHWORDS : Practice and procedure - Industrial Relations Act 1996 s 106 - consideration of nature of power to grant interlocutory relief - whether damages will usually provide adequate relief. Cardile v LED Builders Pty Ltd (1999) 198 CLR 380. Collison v Hewston and ors [2001] 103 IR 403 CSR Limited v Signa Insurance Australia Ltd (1997) 189 CLR 345 at 391 Cyanamid Co v Ethicon Ltd [1975] AC 396 at 408 Darvall v NZI Securities Australia Ltd (1990) 39 IR 215 Francom v Mirror Group Newspapers Ltd [1984] 1 WLR 892 Gough & Gilmour Holdings Pty Ltd and ors v Caterpillar of Australia Ltd and anor (No 9) [2001] NSWIRComm 260 Hill v C A Parsons and Co Ltd [1972] Ch 305 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 Kenoss Contractors Pty Ltd v Allied Constructions Pty Ltd (2001 104 IR 66 per Wright J CASES CITED : Maiden and ors v New Zealand Natural Pty Ltd and anor (unreported NSWIRComm 109 Hungerford J 20 June 1997 Maharaj v 7 Eleven Stores Pty Ltd (unreported IR Comm 1150/97 Peterson J 4 April 1997) Patterson v BTR Engineering (Australia) Ltd (1989) 8 NSWLR 319 Patrick Stevedores Operations No 2 Pty Ltd v The Maritime Union of Australia (1998) 195 CLR 1 at 32 Selman v Sweet [2003] NSWIRComm 14 Sea Acres Rainforest Centre Pty Ltd v The State of New South Wales (2001) 109 IR 56 Stevenson v Barham (1977) 136 CLR 190 TAB Agents' Association of NSW v TAB Ltd [2003] NSWIRComm 316 TeleTech International Pty Ltd v Medical Benefits Fund of Australia No 2) [1998] NSWIRComm 534 Brisbane South Regional Health Authority v Taylor (1997) 168 CLR 541 at 549 Turner v The Australasian Coal and Shale Employees Federation and Elcom Collieries Pty Ltd (1985) 6 FCR 177 HEARING DATES: 05/27/2004 DATE OF JUDGMENT: 07/14/2004

[16]

9 The Summons for Relief spelt out in some detail the deterioration of the relationship between the parties. As this aspect is of some significance in the ultimate determination of the application, the following paragraphs of the Summons for Relief indicate the bitterness of the dispute between the parties: 24. The respondents refuse to meet with the second applicant or to discuss his complaints and insist that he make payment of the full amount charged by the corporate respondent for not only rent but for all other outgoings of the corporate respondent whether or not reasonably required by him. 25. Following the rising of the disagreements referred to, the respondents began [to] engage in conduct calculated to harass, embarrass and humiliate the second applicant with a view to disrupting the peaceful use by the second applicant of his chambers and of driving him from his chambers. 26. On 14 April 2004, the corporate respondents served a notice requiring the payment of money said to be owing. The notice failed to give credit for the amount standing to the credit of the first applicant in the corporate respondent's account. The notice claimed for monies which were not owing. 27. The notice did not state or disclose the respondents' contention that in the event of failure to completely and fully comply with the notice by its due date, the respondents would excluded the applicants from their chambers and treat themselves as holding an irrevocable transfer notice to dispose of the applicants' shares in the corporate respondent. ... 29. On 20 April 2004, the corporate respondent by the second respondent by a formal and peremptory notice purported to require access to the applicants' chambers at 9.30 am on 22 April 2003 "pursuant to the Articles of Association of the Company". The purported requirements stated no factual reason or cause for such requirement. 30. The purported requirement was not authorised by Clause 11 of the First Schedule of the Articles or at all. ... 31. On 21 April 2004, the corporate respondent by the first and second respondents by a formal and peremptory letter stated that the assertions in the second applicant's letter of 20 April "are rejected" and asserted that "failure to comply with the requirements stated in my letter yesterday would be a breach of the Articles of Association". The letter indicated the respondents had paid no regard for the feelings and sensitivities of the applicants but instead had determined upon a course of conduct calculated to humiliate and harass the applicants and to seriously erode and diminish their quiet enjoyment of the premises. The letter was not a genuine response to the expression of applicants' concerns but an abuse or excess of power over the applicants by the respondents. 32. The conduct of the respondents in relation to the notice did not meet the standards of being just and faithful to the applicants. 33. The conduct of the respondent in relation to the notice did not meet the standard of discharging the respondents' fiduciary duties to the applicants but instead represented an abuse or excess of power occasioned by the position of the respondents in relation to the applicants. 34. The conduct of the respondents in relation to the notice was high handed and outrageous, abusive, insulting, oppressive, dismissive and contemptuous. 35. On 22 April 2004, the respondents entered the chambers of the applicants without the consent of the applicants and contrary to the refusal of the applicants to consent to the entry. 36. The entry was unlawful, high handed, outrageous, abusive, oppressive, dismissive, contemptuous and an invasion of privacy. 37. The entry was effected by falsely informing the Clerk to the floor that the respondents had made an arrangement with Mr Sweeney QC to enter his chambers and by obtaining keys and access for that false pretence. 38. The entry was by reason thereof an unlawful breaking and entering by each of the respondents. 39 The entry was observed by members and employees of the floor and others, it having occurred at the busiest time of the day. 40. The entry was calculated to humiliate the applicants. 41. The entry constituted grave professional misconduct by the personal respondents as barristers and constituted a breach of their fiduciary obligations to the applicants and a breach of their duties to be faithful and just to the applicants. 42. Prior to the entry, the respondents had clandestinely engaged a private inquiry agent or investigator to conduct an investigation of the applicants and to examine the telecommunications facilities connected for the benefit of the applicants' chambers to the telecommunications board in the premises. 43. The engagement and investigation was a breach of the fiduciary duty which the respondents owed to the applicants and a breach of their duty to be faithful and just to the applicants, was high handed, outrageous, oppressive and constituted professional misconduct. ... 48. The respondents contend that the Articles of the corporate respondent formed the basis of a contract which entitles them to dispossess the applicants from the premises despite the fact [that] a credit balance exists in their favour. 49. The respondents have threatened and continue to threaten to change the locks and exclude the applicants from their chambers seven days from 14 May 2004. 50. Exclusion from the chambers would prevent the second applicant from carrying on work in an industry namely as a barrister from the chambers. 51. The applicants contend that if the terms of the contract and arrangement do authorise the respondents to remove the applicants from the premises they are unfair and unconscionable. ... 55. The applicants contend to the extent to which the terms of the contract permitted the respondents to engage in humiliating and harassing conduct towards the applicant they are harsh and unconscionable.

[27]

20 These approaches, particularly as expressed in Sea Acres, have more recently been considered by Peterson J in TAB Agents' Association of NSW v TAB Ltd [2003] NSWIRComm 316. His Honour appears to accept the earlier authorities such as Maiden and ors v New Zealand Natural Pty Ltd and anor (unreported, NSWIRComm 109, Hungerford J, 20 June 1997) as establishing that the types of interlocutory orders able to be made by the Court were not limited to Mareva type orders. His Honour noted that on one view there was a clear split in the approach adopted in the line of cases culminating in Kenoss Contractors Pty Ltd v Allied Constructions Pty Ltd (2001) 104 IR 66 per Wright J and the approach taken by Boland J in Collison and in Gough & Gilmour (No 9) and Haylen J in Sea Acres. He noted that central to the reasoning was the power of the Court extending to ensuring final relief would not be frustrated and that any order may be made to protect the Court's jurisdiction. While those two statements could be accepted on their face as correct, both of them derived from authorities dealing solely with Mareva type injunctions such as Jackson v Sterling Industries Ltd (1987) 162 CLR 612; Patterson v BTR Engineering (Australia) Ltd (1989) 8 NSWLR 319 and Cardile v LED Builders Pty Ltd (1999) 198 CLR 380. Peterson J then made the following points: (a) the types of interlocutory orders made by the Court have been limited to Mareva type orders although Hungerford J in Maiden held that the jurisdiction was not limited to such orders; (b) how far the power would extend seemed to remain an open point; (c) save for situations where the applicant has a contractual right to remain, a right which the respondent is seeking to interfere with, an interlocutory order which has the effect of preventing the respondent from terminating a contractual relationship has some hallmarks of specific performance; (d) it was now beyond argument that the source of power to grant interlocutory orders, in the context of s 106 proceedings, is in the implied rather than the inherent power to grant orders to protect the Court's jurisdiction; (e) there was no basis for considering that the source of power to grant Mareva type orders in s 106 proceedings was any different or more limited in respect of a different kind of order seeking the preservation of the status quo in a relationship between the parties pending the final hearing of the matter.

[28]

21 In considering these matters his Honour then concluded: [49] ... The reconciliation of the seemingly conflicted views as to what may come within that power may lie in what Haylen J described in Sea Acres as a case in which '... damages are not an adequate or appropriate remedy as the pleadings and evidence presently stand'. It seems to me that the termination of a contractual relationship, whether one of employment or one more akin to a commercial relationship under which work is performed, is always likely to be, perhaps necessarily, compensable by a money order. It is difficult to conceive, although I do not reject the possibility of, a situation where a money order would not be adequate compensation. ... [50] However, in Sea Acres Haylen J referred to compensation as being not 'adequate or appropriate'. Those terms are not synonyms and I consider the addition of the alternative of 'appropriate' possibly goes beyond the scope of the relevant power. ... [53] I emphasised the sentence in Cyanamid dealing with the object of the interlocutory injunction to be the protection of a right for which the plaintiff could not be 'adequately compensated in damages recoverable in the action'. This observation does not raise any consideration of appropriateness but rather only adequacy. This seems to me to be important in s 106 proceedings which necessarily relate to contracts or arrangements which will always be terminable in an appropriate manner. [54] Further, to utilise mandatory orders to preserve a contractual relationship pending the hearing, would be more in the nature of specific performance, or an injunction to restrain a party from acting lawfully pursuant to his contractual rights. Where the statutory power of the Court includes avoidance of a relevant contract, or its variation, ab initio or from some other time, there seems to me ample power to ensure, at least in the usual case, that a money order under s 106(5) will be able to adequately compensate in such circumstances. ... [57] In a context where there is no power to grant specific performance it is, in my view, immaterial that the contract may be terminated, in the interim, always provided that an alternative money order may be made. That is usually the case with general interlocutory relief: the very principles applied contemplate that, if damages are an adequate remedy, then interim relief is refused. ... [59] I can envisage the possibility that a case may warrant interlocutory orders where an applicant seeks variation of a contract which is within its contractual terms and where no apparent lawful basis for its termination exists. There the potentially unlawful act of the respondent may truly threaten the jurisdiction of the Court in the sense that the availability of relief by money may be inadequate. [60] It has only been in limited circumstances, such as Teletech, that the powers under s 106 have been accepted as extending to the forced retention of a contractual relationship which one party wishes to bring to an end. Such termination, whether involving notice in accordance with the terms of the contract, or elements of breach of those terms, or the assessment of appropriate notice, are always capable of compensation by money order. I can see no reason why the Commission in Court Session ought to be thought to have, pursuant to s 106, a power to compel the continuance of a contractual relationship in circumstances where one or other of the parties wishes it to end.

[33]

26 The discussion in Sea Acres was framed so as to bring together a variety of authorities in this evolving area. Having established the court's power to enable it to act effectively within its jurisdiction (the same basis which gives rise to a Mareva order), and the inappropriateness of referring to these orders as "injunctions" as granted in courts of equity, necessarily meant that the usual tests attending the granting of such an injunction may well be inappropriate in the exercise of this type of power. It was in this context that authority was cited for the proposition that, while the traditional question was - "are damages an adequate remedy?", that question could be rephrased as - "is it just in all the circumstances that the plaintiff be confined to his remedy in damages?". When this Court is faced with an application for the exercise of this implied power, not only is it inappropriate for the Court to be confined to the usual principles applicable to injunctions granted by the Supreme Court in Equity but, as Kirby J said in Cardile, the circumstances in which such an order may be made are not to be circumscribed or "hedged by immutable principles". It is also to be borne in mind that the essence of s 106 (and its predecessors) is the capacity to re-write contracts and arrangements and to create new rights, a power quite foreign to the usual jurisdiction exercised by common law judges or courts of general jurisdiction. The width of remedies available in this court necessarily informs the scope of an interlocutory order to prevent the frustration of the Commission's due process: thus, there may be many cases where confining the applicant to "damages" will not do justice between the parties. Even the term "damages" is misleading when used in reference to the power of this Court to make a money order in relation to unfair contracts. The term "damages" is generally eschewed as an apt description of the power, and the power to make a money order is itself consequential upon the Court finding unfairness in the arrangements.