Textile Clothing and Footwear Union of Australia v Morrison Country Clothing Australia Pty Ltd - [2008] FCA 604 - FCA 2008 case summary — Zoe

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Textile Clothing and Footwear Union of Australia v Morrison Country Clothing Australia Pty Ltd

[2008] FCA 604

Federal Court of Australia|2008-09-05|Before: Tracey J

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Source facts

Court

Federal Court of Australia

Decision date

2008-09-05

Before

Tracey J

Source

Original judgment source is linked above.

Judgment (20 paragraphs)

[1]

REASONS FOR JUDGMENT 1 The Textile Clothing and Footwear Union of Australia ("the applicant") alleges that Morrison Country Clothing Australia Pty Ltd ("the respondent") and Mr Brian Morrison, the sole director, company secretary and sole shareholder of the respondent, are guilty of contempt of Court by reason of their failure to comply with paragraph 1 of orders I made on 28 September 2007.

[2]

BACKGROUND TO THE ORDERS OF 28 SEPTEMBER 2007 2 On 12 September 2006 Ms Elizabeth MacPherson, the President of the Victorian Branch of the applicant, attended the respondent's premises and inspected the respondent's work records. During the inspection Ms MacPherson completed a pro forma document entitled "Clothing Trades Award 1999 Part 9 (Contractors and Outworkers) - Inspection Sheet". She wrote on the inspection sheet: "Told to Supply A Sample of Invoices to each maker from 2005 - current (1 peR (sic) mth) …. Give (sic) until end of business thursday (sic) to provide this information as it was not available & they were not willing to provide the information at the time of inspection." By letter dated 15 September 2006, signed by Mr Mike Hayes, on behalf of the respondent, Ms MacPherson received "[a] sample of invoices from [the respondent's] makers who make Morrison designed garments..." (Emphasis added). 3 On 2 November 2006 the applicant filed a statement of claim in which it was alleged that the respondent had "given work out" within the meaning of the Clothing Trades Award 1999 but had failed to comply with certain provisions of that Award which related to outworkers, including the obligation to keep work records ("the principal proceeding"). 4 The respondent's participation in the principal proceeding has been intermittent at best. No appearance has been filed by the respondent and no defence has been filed. On occasion, the respondent has been represented by Mr Morrison. However, on numerous occasions the respondent has failed to appear at all. The respondent failed to appear at directions hearings held on 15 June 2007, 20 July 2007 and 28 September 2007 and two Court-ordered mediations scheduled for 7 March 2007 and 29 March 2007. A mediation was eventually held on 29 May 2007 but the matter did not settle. 5 On 20 July 2007 I ordered the applicant to provide the respondent with a request for categories of discoverable documents and the respondent to "give discovery of the documents requested by the Applicant by serving a list of documents to be required to be disclosed and an affidavit verifying the list of documents on or before 24 August 2007." 6 On 9 August 2007 Mr Morrison was personally served, and the respondent was served, with a copy of those orders and the applicant's request for categories of documents. The period specified in the request was 1 January 2005 to 12 September 2006, the date on which Ms MacPherson attended the respondent's premises. 7 The matter was next listed for directions on 28 September 2007. The respondent did not appear and had not complied with my orders of 20 July 2007. On 28 September 2007, I made the following orders: "1. Mr Brian Morrison, Director of the Respondent, give discovery of the documents requested by the Applicant (in its Request for Categories of Documents to be Discovered dated 9 August 2007) by serving a list of documents required to be disclosed and an affidavit verifying the list of documents on or before 19 October 2007. 2. That inspection of the discovered documents occur on or before 9 November 2007. …" The orders bore the following notice: "TAKE NOTICE THAT: Pursuant to the Federal Court Rules, you are notified that you are liable to IMPRISONMENT and/or SEQUESTRATION OF PROPERTY if you refuse or neglect to comply with - Order 1 of this Order on or before 19 October 2007, or - Order 2 of this Order on or before 9 November 2007. See Order 37 Rule 2(3) of the Federal Court Rules." 8 A copy of the orders I made on 28 September 2007 was served on the respondent on 3 October 2007 and was personally served on Mr Morrison on 4 October 2007.

[4]

THE CONTEMPT HEARING - Procedures and ADJOURNMENTS 10 The applicant's notice of motion was listed before me on 30 November 2007. Mr Morrison appeared on behalf of the respondent and on his own behalf. As at 30 November 2007, neither Mr Morrison nor anyone else on behalf of the respondent had served a list of documents (or any supporting affidavit) on the applicant, as required by the Order. 11 I asked Mr Morrison whether he was prepared to comply with the Order and explained that this required him to make a bona fide effort to locate all relevant documents and to make them available for inspection by the applicant. Mr Morrison confirmed that he was and told the Court that he would do so to the best of his ability. I adjourned the motion to 14 December 2007 to give both Mr Morrison and the respondent a further opportunity to comply with the Order. I advised Mr Morrison that, if he had not complied with the Court's order by that date, I would give directions to bring on a trial for contempt of Court. Mr Morrison confirmed that he understood the proposed course of action. 12 On 14 December 2007 Mr Morrison appeared on behalf of the respondent and on his own behalf. Despite the Court's indulgence on 30 November 2007, no list of documents (or supporting affidavit) had since been filed by the respondent. During the hearing, Mr Morrison indicated that he understood that he was in contempt of Court: "I was in contempt, your Honour …which I deemed to be serious …. and the last thing I wanted is to defy you or the court or not to provide what, if it was able to be provided, material that has been sought." He stated that he had been "negligent" in not providing an affidavit, but explained he had not done so because the affidavit "would have been almost a blank piece of paper with [his] name on it saying that [he had] searched." 13 I explained to Mr Morrison that the affidavit would require some considerable detail: when he started searching; where he searched, if he had searched at more than one premises, when he went to each of the premises, what he did there, how long he was there, what he searched for and what he found; how much time he devoted to the task; what enquiries he had made of other persons, for example Mr Hayes, who may have knowledge of whether the documentation requested by the applicant exists; and whether those persons were in possession of any documents. Mr Morrison stated that, as there had been hours of searching, there would probably be "hours of recording material, where [he had] searched, what [he] was looking for." 14 Towards the end of the hearing I reiterated that compliance with the Order required Mr Morrison to do more than look for documents and hand them to the applicant's solicitor. I explained that it required Mr Morrison to conduct a renewed search and provide an affidavit explaining what he had done, what he had found, whose assistance he had sought, and what assistance he received. Mr Morrison said that he understood what he was required to do and that he would do it. 15 The orders I made on 14 December 2007 specifically required Mr Morrison to set out in an affidavit the details of any enquiries he had made to comply with the Order: "1. On or before 6 February 2008, Mr Brian Morrison file and serve an affidavit deposing to: (c) The dates and times on which and places where he has undertaken searches; and (d) The details of any enquiries made by him in order to comply with paragraph 1 of the orders made herein on 28 September 2007." …." The notice of motion and the statement of charge were adjourned to 8 February 2008. 16 During the course of the hearing on 14 December 2007, Mr Morrison requested that the applicant provide him with a copy of the sample invoices Mr Hayes had sent to Ms MacPherson on 15 September 2006 (see paragraph [2] above) which he suggested would assist him to make further enquiries. On 19 December 2007 the applicant's solicitor sent Mr Morrison copies of the sample invoices. 17 On 25 January 2008, Mr Morrison swore an affidavit in which he deposed: "1. I, Brian Joseph Morrison, Director of Morrison Country Clothing Australia Pty Ltd, the Respondent to this proceeding, provide to you in this affidavit, all material I can locate requested by the Applicant Textile Clothing & Footwear Union of Australia. 2. I advise the two previous Production Managers of Morrison Country Clothing Australia Pty Ltd have left the employment of this company. Their records are not to be found other that (sic) what is provided by way of my Affidavit. 3. I have checked files, searched for records at length in the office occupied by the previous Production Managers, [and] no additional information is available other than what I am supplying. 4. I inform you that the two companies listed have both ceased trading: N & D Fashions Newtro Pty Ltd 9 Alex Avenue 64 Smith Street Morrabbin (sic) 3189 Kensignton (sic) 3031

[10]

Mr MOrrison's Evidence 28 Mr Morrison gave the following evidence: · He confirmed that he was a director of the respondent. He was not, however, the production manager. He spent eight months of the year out of the office and relied heavily on the team employed by the respondent. · At various times that team comprised Mr Michael Hayes, a part-time internal accountant, who was employed between approximately April 2006 and July 2007; Natalie Simpson, production manager, who was employed between approximately May 2005 and May 2007; and Dianne Maiden, production manager, who was employed between approximately May 2003 and May 2005. · Mr Morrison did not make any enquiries of Mr Hayes, Ms Simpson or Ms Maiden. · Between approximately 1996 and 2005, the records of the respondent were kept in a warehouse located at 31 Wangaratta Street, Richmond. At about Christmas 2005, a lot of the respondent's records were cleared out of 31 Wangaratta Street and were taken to the tip. · Mr Morrison acknowledged that Ms MacPherson said she inspected the respondent's work records in September 2006, after the warehouse at 31 Wangaratta Street had been cleared out, but the only records he could locate were the records he had provided to the applicant. · Mr Morrison was surprised by the applicant's assertion that the documents exhibited to his affidavit were identical to the "sample of invoices" Mr Hayes attached to his letter to Ms MacPherson dated 15 September 2006, a copy of which was provided to the respondent on 19 December 2007. · He had received external legal assistance in preparing the affidavit and assumed that what had been prepared was adequate. · He recalled being present in Court on 14 December 2007, when orders were made requiring him to do certain things in relation to those records, and acknowledged that he had been told, by me, that he should tell the Court on affidavit the dates and times and the places where he had undertaken searches. He thought the fact that he mentioned that he looked in the production manager's offices, "covered [him] for that." He did not give a date or a time for his searches "but it was obviously - it would have been on weekends between - probably over Christmas." · He had looked through the warehouse (which I took to be a reference to the warehouse at 27-29 Wangaratta Street then occupied by the respondent) but had not looked anywhere else. · The only person of whom Mr Morrison had made enquiries his wife. She had advised him that "the only place there would be any records is in the production room." · He made no other enquiries. 29 Under cross-examination Mr Morrison gave the following additional evidence: · He had checked the computers and the records of the "production ladies". · It had not occurred to him to ask Mr Hayes to give evidence. · He acknowledged that he had not set out the time or specific days on which he had searched or the time taken to conduct the searches.

[15]

Elements of contempt 35 In Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201 Gillard J identified the elements which it is necessary for a complainant to establish in order to make good a charge of civil contempt of court. His Honour said: "[31] In order to prove a civil contempt of court involving a breach of an order of the court, the plaintiff has to prove the following: (i) that an order was made by the court; (ii) that the terms of the order are clear, unambiguous and capable of compliance; (iii) that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of Court; (iv) that the alleged contemnor has knowledge of the terms of the order; and (v) that the alleged contemnor has breached the terms of the order. [32] It is necessary for the plaintiff to prove each element beyond reasonable doubt. In accordance with the principles of the criminal law, in proving element (v) it must be proven that the act or omission which constituted the breach of the order was deliberate and voluntary." 36 As noted by his Honour, the standard of proof required for each of the elements of a charge of contempt of this Court is proof beyond reasonable doubt (see: Witham v Holloway (1995) 183 CLR 525 at 534). 37 There is no dispute, and I am satisfied that: · Paragraph 1 of the orders I made on 28 September 2007 was an order of the Court. · The Order was clear, unambiguous and capable of compliance; · The Order was personally served on Mr Morrison on 4 October 2007 and was served on the respondent on 3 October 2007; and · Mr Morrison had knowledge of the terms of the Order. 38 It was not disputed that the respondent had knowledge of the terms of the Order. On the facts of this case, there can be no doubt that Mr Morrison's mind is the mind of the respondent (see: Hamilton v Whitehead (1988) 166 CLR 121 at 127 referring with approval to Tesco Supermarkets Ltd v Nattrass [1972] AC 153). I am, therefore, satisfied that the respondent had knowledge of the terms of the Order.

[16]

Breach of the Order 39 Mr Morrison has put in issue the question of whether, by filing the affidavit which he swore on 25 January 2008 (set out above at [17]), the Order had been complied with. 40 In Australian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 Gibbs CJ, Mason, Wilson and Deane JJ said (at 112 - 113) that: "…lying behind punishment for a contempt which involves wilful disobedience to a court order, is the very substantial purpose of disciplining the defendant and vindicating the authority of the court. … a deliberate commission or omission which is in breach of an injunctive order or an undertaking will constitute such wilful disobedience unless it be casual, accidental or unintentional." 41 It is clear that Mr Morrison's affidavit does not, in terms, comply with the Order. A breach of an order will be considered deliberate if it is not found to be casual, accidental or unintentional. The onus remains on the party seeking to prove the contempt to prove that the alleged contemnor's conduct is not casual, accidental or unintentional. 42 There is no evidence before the court which suggests that Mr Morrison's conduct was casual, accidental or unintentional. On the contrary, Mr Morrison was aware that, to comply with the Order, he was required to make reasonable enquiries to determine the existence or non-existence of documents requested by the applicant and set out the details of those enquiries and list the documents which he discovered and explain what had become of documents which had been in the respondent's possession but which could no longer be found. The list was to be verified by affidavit: cf Australian Competition and Consumer Commission v Goldstar Corporation Pty Ltd [1999] FCA 585 at [41]. Despite this, the only evidence before the Court of the steps Mr Morrison had taken to comply with the Order was that he had "checked files" and "searched for records at length in the office occupied by the previous Production Managers". His affidavit did not list or describe the documents which were in the respondent's possession, nor did it describe the documents which were no longer in the respondent's possession or state when the respondent parted with the documents and what had become of them, as required by Order 15 r 6 and Form 22 of the Federal Court Rules 1979 (Cth). 43 In his oral evidence, Mr Morrison added that he had also looked through the warehouse and had asked his wife if she had any knowledge about where the documents might be found. Mr Morrison did not contact either of the former production managers, or Mr Hayes, despite being aware of his obligation to make enquiries of people who may have had knowledge of the documents sought by the applicant. 44 I am by no means persuaded that Mr Morrison made a valiant effort, or, indeed, any serious effort, to search for documents. The only documents Mr Morrison has discovered or provided to the applicant are copies of the documents that were sent to him on 19 December 2007. I am unable to accept Mr Morrison's claim that he was surprised that the documents exhibited to his affidavit were identical to those he received from the applicant's solicitors in December 2007. He was well aware of the source of the documents and that he had not discovered any additional documents. He knew that additional documents existed (or had existed) which should have been discovered. I make due allowance for the fact that Mr Morrison did not have legal advice at all relevant times. 45 I am satisfied, beyond reasonable doubt, that Mr Morrison and the respondent wilfully disobeyed the Order, and that the non-compliance was not casual, accidental or unintentional.