Manning v Arafura Pearls Holdings Ltd [2010] FMCA 829 (17 September 2010)

Last Updated: 7 December 2010

FEDERAL MAGISTRATES COURT OF AUSTRALIA

MANNING v ARAFURA PEARLS HOLDINGS LTD

[2010] FMCA 829

INDUSTRIAL LAW – Application for production of documents for examination – contest as to whether document produced – application for leave to cross examine applicant on his affidavit in interlocutory application – basis for exercise of discretion to refuse leave – application to split case for trial of separate issue.

Bankruptcy Act 1966

Freehill Hollingdale & Page v Bandwill Pty Ltd & Anor [2000] WASCA 150 Wik Peoples v The State of Queensland (1996) 141 ALR 129 Wu v Avin Operations Pty Ltd (No.3) [2006] FCA 1321

Applicant:

RAMAH MANNING

Respondent:

ARAFURA PEARLS HOLDINGS LTD

File Number:

BRG 206 of 2010

Judgment of:

Burnett FM

Hearing date:

17 September 2010

Date of Last Submission:

17 September 2010

Delivered at:

Brisbane

Delivered on:

17 September 2010

REPRESENTATION

Counsel for the Applicant:

Mr Hibble

Solicitors for the Applicant:

Stevenson McNamara Lawyers

Counsel for the Respondent:

Mr Roper

Solicitors for the Respondent:

De Silva Hebron Lawyers

ORDERS

(1) That the application be dismissed.
(2) That the costs of and incidental to the application be costs in the cause.
(3) That the Respondent make any application for security for costs, if any, on or before 4 pm on 7 October.
(4) That the matter be listed for mention at 9.30am on 19 October 2010.

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE

BRG 206 of 2010

RAMAH MANNING

Applicant

And

ARAFURA PEARLS HOLDINGS LTD

Respondent

REASONS FOR JUDGMENT

(Ex Tempore)

Introduction

1. This is an application brought by the respondent, Arafura Pearls Holdings Ltd, seeking directions that the applicant, Ramah Manning, produce to it the original letter addressed to the applicant and signed by one Chris Bernard, dated 28 July 2007, within seven days of these orders and in the alternative that these proceedings be dismissed and/or permanently stayed.

Background

2. The principal application is one brought by the applicant employee seeking reinstatement. I expect now the claim is going to one for compensation, in respect of an alleged unlawful termination of employment. The employee had allegedly been employed by the employer on certain terms, and it seems that the terms revolve around an offer contained in a letter said to have been forwarded by the employer to the employee and dated 28 July 2008, which incorporated various terms. In particular, it stated:
   • “Ramah,
   • Furthermore to our discussions regarding your employment with Arafura Pearls Holdings, I’d like to offer you a position as a Master 5. As discussed, Arafura Pearls Holdings would like to offer you a daily rate $A300 per working day based on a 10 hour working day, working a six week on, two week off roster. Your starting date will be 7 August 2008. I would like to take this opportunity and welcome you aboard and look forward to a long and rewarding working relationship.
   • Regards,
   • Chris Bernard.”
3. Employment commenced, but the employee contends that the terms and conditions were significantly different to those which are outlined in the letter of Chris Bernard of 28 July 2008. The employee contends that, apart from a difference in the rate of pay, there was also a difference in the working arrangements, with the work being four weeks on, two weeks off and so forth.
4. The real issue in this case revolves around the terms of the offer made by the employer to the employee as contained in the letter of offer of 28 July 2008. That particular letter gives rise to the first of the employee’s complaints of unlawful termination; it being said that he was unlawfully terminated because he refused to work for terms other than those that he says were agreed between he and the employer; and second, a claim for compensation in respect of outstanding pay for duties performed up to the time of termination and then for some time afterwards. Presently, it is not necessary for me to descend into further detail concerning those matters.
5. The real issue, as I have noted, however, concerns the offer. At an early stage, the respondent employer identified concerns about the letter of offer. He was concerned that the letter of offer was not authentic and did not reflect the terms of any offer made by the employer to the employee. Those matters were agitated early in the application, and orders were made by me on 2 June 2010 directing the applicant to produce the original letter to the respondent, for the purpose of the respondent subjecting the letter to forensic examination. The order required that that was to occur by 22 June 2010.
6. The evidence is that the employee complied with the order and did forward to the employer’s solicitors that document. In an affidavit filed on 31 August 2010, he says that he complied with the order by forwarding the letter required for forensic investigation by registered mail on 9 June 2010. Although somewhat loosely expressed, I take that to mean that the letter was incorporated in the envelope which was forwarded by registered mail on 9 June.
7. The respondent employer’s solicitors received an envelope on 11 June 2010. Ms Lambourne, who is a receptionist employed by the employer’s solicitors, has sworn to having recorded the receipt of the mail sent by the employee to the employer’s solicitor, Mr de Silva. She opened the envelope to stamp and mark the enclosed correspondence, which was in accordance with her usual practice. She said that upon opening the envelope from Mr Manning, she noted there was nothing inside.
8. It would seem, on the basis of the evidence before me, that Mr Manning says he forwarded the original letter, but that somehow, between the time of it being forwarded by post by Mr Manning and its receipt by Ms Lambourne a number of days later, the contents of the envelope have been removed. That, of course, is one possible explanation. Another, of course, is that Mr Manning never included or placed the original letter in the envelope; and finally of course, another possibility is that some other person has removed the original letter from the envelope to keep it from the employer. They appear, at least, to be the three most plausible explanations consistent with what are otherwise the facts as asserted by each of the parties in their respective affidavits.
9. Accepting Mr Manning’s affidavit at face value, it would seem that he has complied with the court’s order made on 7 July 2010, and it would follow that there is no utility in making any further order in terms of the order sought in the application. It is for that reason, subject to one matter that I will address shortly, that the application must fail. However, the applicant says I should determine the issue concerning the existence of this letter now as a discrete point.
10. That, of course, leads to the next issue, which underlies the real issue in this application, and that is the question of the reliability and credibility of each of the employee, Mr Manning, and the receptionist, Ms Lambourne. If I were to resolve that matter immediately, then I would perhaps be in a position to determine the application in a case on its merits rather than simply on the papers. That would require the granting of leave to cross examine on affidavits in an interlocutory application. It is well settled that such leave is granted sparingly; Freehill Hollingdale & Page v Bandwill Pty Ltd & Anor [2000] WASCA 150 at [29]; Wu v Avin Operations Pty Ltd (No.3) [2006] FCA 1321. However, in this case there are good policy reasons why it would not be appropriate, I think, for me to determine that particular point at this time.
11. First, it seems to me that credibility of the applicant employee particularly is going to be important in the resolution of this proceeding. Given that context and given the limited nature any cross-examination that might occur and any findings that might arise from cross-examination in respect of this discrete application on an interlocutory point, it may prejudice my capacity to proceed to determine the application generally; the risk being that parties may feel that I have prejudged issues of credit that should be at large, rather than limited to one discrete point.
12. Furthermore, as matters presently stand, this particular application is being conducted by video-link which, from my experience, is a very poor medium for the assessment of credibility in cases where issues of credit are fine and have to be assessed, particularly by reference to the manner in which witnesses answer questions and their general demeanour. So it follows that, for that reason, I am not inclined to entertain an application to cross-examine witnesses and make findings in relation to the truth or otherwise of the two competing versions in this limited context. Again, that supports my view that the application ought to fail.
13. That, however, is not the end of it, because the suggestion has been made that what I ought to do is consider entertaining a trial of this matter as a separate point. The Court has the power to order for the determination of separate decisions or questions; insofar as this court applies the rules of the Federal Court, where its own rules are deficient, order 29 of the Federal Court Rules comes into play. It provides in order 1 that:
    • “In this order, question includes any question or issue in any proceeding, whether of fact or law or partly of fact and partly of law, and whether raised by pleadings, agreement of the parties or otherwise.”
14. Rule 2, then, materially proceeds to provide:
    • “The Court may make orders for:
      • (a) the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings; and
      • (b) the statement of a case and the question for decision.”

The Court therefore has the power to entertain an application of this kind.

15. As to how the Court exercises that power is addressed by any number of decisions referred to in the CCH High Court and Federal Court Practice, volume 2, annotations to order 29, the most useful of which can be found in the summary extracted from the judgment of the Wik Peoples v The State of Queensland[1]. There, Drummond J said this:
    • “The procedure can be appropriate even though a decision on a preliminary issue or issues will not determine the litigation. It is enough if the determination will substantially narrow the field of controversy. Whether the procedure is appropriate in a particular case will in large part depend upon the court being satisfied that, even if it will not put an end to litigation, a determination of the preliminary issue in one way will substantially shorten the trial or result in a significant saving in time or money. The attitude of the parties is also relevant in deciding whether to use the procedure.”
16. As I have noted, there are a number of single judge decisions which exemplify the application of those principles but, by and large, it seems to become a question of economy and convenience.
17. In this case, it is agreed between the parties that if the trial were to run its full length, it would probably run for two to three days. It is also agreed that the preliminary hearing will require at least one day and, on my very quick assessment, it may even trickle into a second, as much of the evidence in the preliminary application and substantive application will be common. The parties reside in Townsville and Darwin, respectively, and it is likely that the Court will travel from Brisbane to one of those locations for the trial. In any event, irrespective of whether the trial is done by me or by someone else resident in Townsville, the fact remains that witnesses and parties will have to travel to one or the other of those two venues for the conduct of the trial. It will be an expensive exercise. Obviously, if the matter is determined in favour of the principal applicant, then there may be further hearings involved. No doubt, if the principal applicant fails, that may well be the end of the proceeding. But, notwithstanding, there may be a saving of only one day’s court time, but not the travel costs associated with the return for the second day. It really seems to me that, unlike many of the cases that can be seen in the annotations to Order 29, this is a case where there will be little difference between the inconvenience occasioned by perhaps an extra day’s hearing involved for the full trial of a matter, compared to the hearing at the preliminary point, which may take one and perhaps trickle into a second day. On that basis it seems to me that, as a matter of economy, the preferred course is to dispose of the matter as part of the overall proceeding. I am conscious that the matter can be disposed of separately, but I think, having regard to that overriding feature, it should not be disposed of separately in this instance and so I will not make any orders for the splitting of the trial.
18. I am, however, mindful of the respondent’s position in this application and of what appears to be good grounds for its suspicion concerning the authenticity of this document. That is particularly raised by reference to independent material; that is, its evidence about the relevant addresses at the time that the purported letter was signed by or said to have been signed by its managing director. They are significant issues which have not been fully addressed in the material submitted today by the employee.
19. The employee’s affidavit material addresses the address point; however, it is worth noting that the letter which is produced by the employee predates the relevant letter by approximately 12 months, and in the absence of anything to the contrary, I have no reason to doubt the evidence of Mr Hewitt, who is the Chief Executive Officer for the respondent, that as at the relevant dates, those addresses, that is, the addresses contained in the letter of July 2008, were not the then addresses of the corporation. It follows that although I will make orders in relation to the trial, I will permit the respondent employer sufficient time to bring an application for security for costs, so that if it chooses to do so, it can seek to secure its position, pending any trial of the matter.
20. So far as costs are concerned, having regard to the contest which is alive today, I propose to make an order that the costs of today’s application be costs in the cause. That way the costs will follow my determination on the authenticity or otherwise of the letter in question.

I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of Burnett FM

Date: 2 November 2010

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[1] (1996) 141 ALR 129