Enright v The Batlow RSL Club Limited & Anor [2011] FMCA 507 (28 June 2011)

Last Updated: 15 July 2011

FEDERAL MAGISTRATES COURT OF AUSTRALIA

ENRIGHT v THE BATLOW RSL CLUB LIMITED & ANOR

[2011] FMCA 507

INDUSTRIAL LAW – Practice & procedure – respondents seeking preliminary trial of allegation of release by applicant – alleged informal agreement at Fair Work Australia conciliation – draft deed of release never signed by applicant – defences not properly pleaded – application for separate trial or summary judgment refused.

Fair Work Act 2009 (Cth) Federal Court Rules (Cth), Order.29 r.2 Federal Magistrates Act 1999 (Cth), s.17A Federal Magistrates Court Rules 2001 (Cth), r.13.10, Pt 17

Dr Payne v University of Sydney & Anor [2000] IRComm 102 Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353 Smarzak v Grimes Management Services Pty Ltd [2000] IRComm 73

Applicant:

PAULA JANE ENRIGHT

First Respondent:

THE BATLOW RSL CLUB LIMITED (ACN 001 034 117)

Second Respondent:

ROBYN BURNS

File Number:

SYG 743 of 2011

Judgment of:

Smith FM

Hearing date:

28 June 2011

Delivered at:

Sydney

Delivered on:

28 June 2011

REPRESENTATION

Counsel for the Applicant:

Mr S Meehan

Solicitors for the Applicant:

Kemp Strang

Counsel for the Respondents:

Mr B Cross

Solicitors for the Respondents:

Clubs NSW

ORDERS

(1) The respondents’ application in a case filed on 6 June 2011 is refused.
(2) The applicant’s application for costs in relation to that application is reserved.
(3) Order 3 made on 20 May 2011 is amended by extending the time for the filing of defences and cross-claims to no later than 8 July 2011.
(4) The applicant must file and serve any pleading by way of defence or reply, and all affidavits relied upon in chief, no later than 29 July 2011.
(5) The respondents must file and serve all affidavits relied upon no later than 26 August 2011.
(6) The applicant must file any affidavits in reply no later than
16 September 2011.
(7) The Orders made on 20 May 2011 are otherwise confirmed.

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY

SYG 743 of 2011

PAULA JANE ENRIGHT

Applicant

And

THE BATLOW RSL CLUB LIMITED (ACN 001 034 117)

First Respondent

ROBYN BURNS

Second Respondent

REASONS FOR JUDGMENT

(revised from transcript)

1. The present matter commenced with an application filed on 15 April 2011, in which Ms Enright seeks relief from her former employer, The Batlow RSL Club and an officer of that club. She seeks the imposition of pecuniary penalties for alleged contraventions of the Fair Work Act 2009 (Cth) in relation to obligations to pay a sum in lieu of accrued annual leave upon the termination of her employment on 15 July 2010. A pleading which accompanied the application includes a common law contractual claim, or consequential compensatory claim under the Fair Work Act, seeking damages for loss of entitlements under a written contract of employment, which had a specified term of five years from 22 July 2008. The pleading appears to me to competently plead comprehensible claims for relief, and is supported by affidavits filed by Ms Enright.
2. The matter came before me at a First Court Date on 20 May 2011, at which Ms Enright was represented by her solicitor, and the respondents were represented by Mr Cross of counsel instructed by the Club’s industrial organisation. A full timetable leading to a final hearing was ordered, providing for the respondents to file their defences on or before 24 June 2011, affidavits to be exchanged, referral to a mediation, and a three day trial to commence on 18 October 2011.
3. The respondents have not complied with the timetable in relation to filing their defences, but they filed an application in a case on 6 June 2011, which seeks the following orders:
   • 1. An ORDER that the First Respondent pay the Applicant Five Thousand Dollars ($5,000.00) less appropriate taxation.
   • 2. An ORDER that the Applicant’s claim against the First Respondent be dismissed.
   • 3. An ORDER that the Applicant’s claim against the Second Respondent be dismissed.
   • 4. An ORDER that the Applicant pay the costs of the First and Second Respondents of and incidental to this Notice of Motion on an indemnity basis.
   • 5. Such further or other orders as the Court considers appropriate.
4. An affidavit was filed in support by a workplace relations advocate,
   Ms Nicolle, who represented the club at conciliation proceedings in Fair Work Australia following Ms Enright’s termination. It deposes to events in a telephone conciliation proceeding on 13 August 2011, also involving an industrial officer representing Ms Enright and officers of Fair Work Australia. The affidavit alleges, but does not recount in admissible terms, conversations which are alleged to have given rise to a contractual obligation on Ms Enright to execute a broadly worded release encompassing Ms Enright’s claims in the present proceeding, in return for a promise to pay $5,000 less adjustments.
5. The documents attached to the affidavit show that, in fact, Ms Enright never signed a draft release, which was presented for her signature by the representatives of the Club subsequent to the conciliation conference. It is difficult to see how the assertion of a completed contract is at present supported either by Ms Nicolle’s account of the conversations at the conciliation conference or by her handwritten notes. However, as I must make clear, I am giving no opinions at this stage as to the merits of the asserted contract for release arising from the conciliation conference on 13 August 2010.
6. The application in a case was listed before me for directions on
   17 June 2011, at which time I suggested to the representatives of the parties that it appeared to me that the application in a case was brought under s.17A of the Federal Magistrates Act 1999 (Cth) and Federal Magistrates Court Rules 2001 (Cth), r.13.10, that is, as an application for summary dismissal of the application on the ground that Ms Enright “has no reasonable prospect of successfully prosecuting the proceeding or claim”, or the proceeding or claim “is an abuse of the process of the Court”, by reason of the existence of a binding or enforceable release. I did not detect any disagreement with my analysis, and I then set aside a relatively short period today to address what I envisaged to be a motion for summary judgment, indicating that I would hope that it could be decided on the affidavits filed without cross-examination.
   I directed a timetable for any additional affidavits.
7. No additional affidavits have been filed, except for one on behalf of
   Ms Enright going to issues of costs.
8. Shortly before today’s listing, Mr Cross filed an outline of submissions on behalf of the Club and the second respondent, suggesting that he was expecting, in effect, a preliminary full trial of the issue as to the existence of a binding contract on Ms Enright to release the Club from all causes of action encompassing the claims made by her in the present proceedings. His written submission referred me to Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353, and submitted that the evidence which he expected to elicit orally from Ms Nicolle and further witnesses under subpoena to give oral evidence, and which has not yet been foreshadowed to Ms Enright, would establish a binding oral contract within the first class of Masters v Cameron at page 360, rather than the third class being a non-binding agreement “in principle” subject to the entry of formal documents.
9. Mr Cross maintained this position today. He cited several decisions in the Industrial Relations Commission of New South Wales, in which it appears full blown preliminary trials were held as to the existence of binding contracts involving releases or estoppels, entered into in the course of proceedings in that body. In particular, he cited Smarzak v Grimes Management Services Pty Ltd [2000] IRComm 73 and
   Dr Payne v University of Sydney & Anor [2000] IRComm 102. However, it appears to me that the circumstances addressed by the Industrial Commission in both of those cases were very different to the circumstances sketched by Ms Nicolle in her affidavit. I gained little assistance from them in relation to the present matter, either in relation to the procedures to be followed in this Court, or the circumstances which could constitute a binding contract arising from an incomplete conciliation procedure.
10. When in the course of argument today, I pointed out that the Court did not have time available this afternoon to embark on a full blown preliminary trial of the contested legal and factual issues raised by his application, Mr Cross accepted that, in effect, he needed to persuade me to make an order by way of case management in the proceedings, whether under Part 17 of the Federal Magistrates Court Rules or under my general powers, for the hearing of a preliminary issue on a final basis, being the existence of a binding contractual release. I assume that the Court has power to give those directions.
11. However, in my opinion, even more than do superior courts in relation to their discretions to order a separate preliminary trial of contested factual and legal issues, this Court needs to approach the splitting of triable issues in a matter with considerable caution. It is the experience of all courts, and certainly my experience as a practitioner and on this bench, that the splitting of trials can often be more conducive to protraction of proceedings and added legal expenses to both parties, than otherwise. I have a considerable sympathy with the authorities extracted in the Butterworths Federal Court Practice and Procedure in relation to Federal Court Rules (Cth), Order 29 r.2, pointing to the essential concern of “efficient case management”, with the need for the Court to be firmly persuaded that there is likely to be a decisive point that can be decided shortly and conveniently, with clear prospects of bringing an early finality to the proceedings, and that there is “general undesirability of isolating a preliminary question” where the factual foundation for the determination is disputed and unclear.
12. In the present case, I have a fundamental difficulty with ordering a preliminary trial in the present situation, due to the absence of any pleading by the respondents of their defence, in particular, as to the precise circumstances and oral exchanges constituting the alleged oral contract, and, in particular, the exact terms of the release which is contended to have been promised. As was pointed out by counsel for Ms Enright, the affidavit of Ms Nicolle in this respect is far from providing a satisfactory substitute for a proper pleading of the allegation of a binding promise to give a release. Moreover, the relief which is claimed by the Club is also obscure, since on one view the present interim application appears to seek orders by way of specific performance. If so, in my opinion, this also should be properly pleaded by way of cross-claim. In short, the allegations of the respondents which they seek to have addressed at a preliminary trial, are far from properly prepared and presented to the Court to allow it to find attraction in that course.
13. I have taken into account all the submissions made by counsel for the respondents today. However, in my opinion, the proper case management of the present matter points towards endeavouring to retain the three day trial already appointed for September, as the occasion on which I would expect the parties to present all issues for trial, supported by proper pleadings and evidence on affidavit.
14. If I were to split the matter, as the application in a case proposes, and assuming that the separate issue could be prepared in time for trial in September, it is likely that if I were against the Club in relation to its suggested contractual point, then Ms Enright would face a further delay of up to six months before a trial of her claims would be appointed. This Court is under pressure at present in this registry in relation to court room and judge availability for trials exceeding two days, and will become even more so from the end of this year.
15. I am not persuaded on a highly provisional view of the evidence suggested in support of the Club’s defence by way of release, that it has such obvious or apparent merit as to deserve initial determination, in circumstances where that procedure would jeopardise Ms Enright’s claims being brought to trial this year. In this respect, I note that
    Mr Cross did not make submissions to me today to persuade me that Ms Nicolle’s affidavit allows the Court to conclude that Ms Enright’s claim has no reasonable prospects of success. In the absence of such persuasion, necessarily I could not be persuaded that its continuance against the respondents would be an abuse of the process of the Court.
16. I am therefore persuaded neither to order a separate trial of the projected grounds of defence raised by the respondents, nor that they are entitled to summary judgment on their interim application. In my opinion, the interim application should be refused, and the matter should proceed to trial in accordance with my previous directions, with some modification to the time-table.
17. I note that nothing in this judgment should be regarded as precluding the proper pleading by the respondents of a defence by way of release and the claiming of any relief by way of cross-claim that might be appropriately sought. Nor should anything that I have said in this judgment be taken as indicating that I have arrived at any conclusions as to the factual and legal issues which might arise, if a defence by way of release were properly pleaded and presented at trial.

I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of Smith FM

Associate:

Date: 11 July 2011