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Federal Court of Australia |
Last Updated: 3 November 2008
FEDERAL COURT OF AUSTRALIA
CBI Construction Pty Ltd v Abbott [2008] FCA 1629
INDUSTRIAL LAW – interlocutory
injunction – respondents engaged in industrial action by failing to attend
work without authorisation
– continued to do so contrary to an order made
by the Australian Industrial Relation Commission - threats made to continue
to
strike – consideration of terms used in the Building Construction
Industry Improvement Act 2005 (Cth) - source of Courts power to grant
injunctions – serious issue to be tried – effect on applicant of
further industrial
action significant – respondents returning to work is
not a reason not to grant an injunction – other relevant considerations
-
balance of convenience strongly in favour of grant of injunction - injunction
granted.
Building Construction Industry
Improvement Act 2005 (Cth) s 3, 5, 36(1), 49(1), (3), (6)
Building and Construction Industry Long Service Leave Payments Act 1974
(NSW) s 4
Federal Court of Australia Act 1976 (Cth)
ss 23, 37, 38, 39
Income Tax Assessment Act 1997 (Cth)
s 83-175
Trade Practices Act 1974 (Cth) s 80(4)
ATO
draft Ruling TR 2008/D6
Belgrave
Nominees Pty Ltd & Ors v Barlin-Scott Airconditioning (Aust) Pty Ltd
[1984] VR 947 cited
Cahill v Construction Forestry Mining and Energy Union
(No 2) [2008] FCA 1292 cited
EPM Concrete Pty Ltd v Building and
Construction Industry Long Service Leave Payments Corp (1985) 23 IR 430
referred to
Davids Distribution Pty Ltd v National Union of Workers
[1999] FCA 1108; (1999) 91 FCR 463 cited
Evans Marshall & Co Ltd v Bertola SA and
Sherry Imports Ltd [1973] 1 WLR 349 cited
ICI Australia Operations Pty
Ltd v Trade Practices Commission [1991] FCA 527; (1992) 38 FCR 248 referred to
John
Holland Pty Ltd v Construction, Forestry, Mining and Energy Union (2005) 144
IR 418 referred to
Johns v R [1980] HCA 3; (1980) 143 CLR 108 cited
Kestrel
Coal Pty Ltd v Construction, Forestry, Mining and Energy Union [2001] 1 Qd R
634 referred to
Leighton Contractors Pty Ltd v Construction, Forestry,
Mining and Energy Union (2006) 154 IR 228 cited
Leighton
Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006)
149 IR 306 cited
Leighton Contractors Pty Ltd v Construction,
Forestry, Mining and Energy Union (2006) 149 IR 299
cited
Patrick Stevedores Operations Pty Ltd v Maritime Union of
Australia (1998) 82 IR 87 cited
Reid v Smith [1905] HCA 54; (1905) 3 CLR 656
cited
R v Thomson [1997] 1 Qd R 623 cited
United Group
Infrastructure Pty Ltd v Automotive, Food, Metals, Engineering, Printing and
Kindred Industries Union (2005) 148 IR 399 cited
CBI
CONSTRUCTORS PTY LTD (ACN 000 612 411)
WAD 230 of
2008
GILMOUR J
28 OCTOBER
2008
PERTH
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AND:
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|
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AND:
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AUSTRALIAN BUILDING AND CONSTRUCTION
COMMISSIONER
Intevener |
UPON THE APPLICANT UNDERTAKING
TO:
(a) Submit to such order (if any) as the Court may consider to be just for the payment of compensation to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of the interlocutory order made hereunder or any continuation (with or without variation) thereof; and
(b) Pay the compensation referred to in (a) to the person there referred to
THE COURT ORDERS THAT:
1. Until determination of the application or further order, each of the Respondents identified in the attached Schedule, while employed by the Applicant to work on the Stabiliser 6 or Vapour Return Line packages, be restrained from failing to attend for work and/or failing to perform work in the manner as customarily performed for the Applicant.
2. Without limitation as to other means of service, service of this Order as required by Order 37 Rule 2 of the Federal Court Rules is dispensed with and, instead, service of this Order on the Respondents is permitted by any one of the following methods:
(a) leaving an original or copy (including a facsimile copy) of the Order with or tendering an original or copy of the Order to the Respondent intended to be served;
(b) providing or forwarding by facsimile transmission an original or copy of the Order to the solicitors of the Respondent intended to be served; or
(c) leaving a copy (including a facsimile copy) of the Order with a person apparently over the age of 16 years at the residential address of the Respondent intended to be served, being the address provided by that Respondent to the Applicant and held by the Applicant as part of the personnel records of that Respondent.
3. Pursuant to Order 7 Rule 10 the Application and Notice of Motion and the affidavits of Stuart Kenneth Macaree sworn on 22 October 2008, Damien Peter Swingler sworn on 23 October 2008 and Marlon Nilan Gerard Cooray sworn on 22 October 2008 (Originating Documents) be taken to have been served when the Respondent intended to be served has been provided personally with copies of the Originating Documents or copies of the Originating Documents have been left with a person apparently over the age of 16 years at that Respondent's residential address, which is the address provided by that Respondent to the Applicant and held by the Applicant as part of the personnel records of that Respondent.
4. Pursuant to Order 4 Rule 11 and/or Order 19 Rule 3, the time for service of the Originating Documents be abridged so far as is necessary to enable the motion of which notice is hereby given to be heard on 28 October 2008.
5. Liberty to the Applicant to apply on such notice as a judge shall allow to discharge or vary this Order.
6. The directions hearing in the proceedings be otherwise adjourned to a date to be fixed.
7. The costs of and incidental to the interlocutory application be reserved.
SCHEDULE
Respondent Name
2. Louise Andrews
4. Moses
Asiata
7. Craig Bailey
9. Francisco Barraza
11. Richard
Bauer
13. Leon Becker
15. Peter Best
16. Patrick
Bird
17. Terrance Bishop
19. Romeo Boncato
23. Kristian
Brinkley
24. Dennis Brockmann
25. Robert Brown
32. Robert
Clark
35. Donald Colyer
39. Lance Cronin
42. Kenneth
Cumming
43. Alastair Cunliffe
46. Juliana Davies
50. Claude
Devos
51. John Dickson
54. Andrew Donnon
55. Daniel
Doyle
57. Michael Duggan
59. Johannes Duplessis
61. Don
Elcock
66. David Fergusson
67. Jose Ferreira
71. George
Fitzroy
72. David Fraser
73. Salvatore Fronte
76. Scott
Gardner
87. Nikola Grubic
92. Daryl Hendrick
95. Stephen
Honicke
98. Vincent Howes
108. Raymond Jones
110. Turipi
Karutjindo
112. Shaun Keily
113. Lenko Korljan
114. Vlado
Kukulj
115. Darrin Lane
116. Shane Lavelle
118. Charlie
Liness
120. Kenneth Logan
122. Michael Lord
123. Donald
Mackay
125. Allan Marold
126. Denis Marriner
130. Gregory
McCarthy
131. Paul McGeady
132. Russell
McGhie
134. Alastair McGuire
137. Dean Medland
141. Pasko
Mitreski
147. Jamie Nicolaou
148. James Odiam
150. Jonathon
Ott
152. Mandy-Lee Palmer
153. Brett Parry
154. Frank
Patteri
156. Andrew Peck
160. Sheree Pike
166. Baden
Richer
168. John Rogusz
171. Phillip Rowell
172. Mike
Rowlett
173. Tom Sabine
174. Wayne Salt
177. Anton
Saxer
183. Felix Smith
185. Dusko Sobot
186. Richard
Southern
187. Graeme Sowden
189. Graham
Sparke
190. Benjamin Spronk
191. Richard Stott
195. Ken
Thach
198. Bryan Tonkin
200. John Tuivasa
201. Greg
Uchwal
204. Mitchell Weir
205. David Whitehead
207. Simon
Young
208. Lesley Young
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal
Court Rules.
The text of entered orders can be located using eSearch on the
Court’s website.
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BETWEEN:
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CBI CONSTRUCTION PTY LTD (ACN 000 612 411)
Applicant |
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AND:
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BENJAMIN ABBOTT & ORS
Respondents |
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AND:
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AUSTRALIAN BUILDING AND CONSTRUCTION
COMMISSIONER
Intervener |
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JUDGE:
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GILMOUR J
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DATE:
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28 OCTOBER 2008
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PLACE:
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PERTH
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REASONS FOR JUDGMENT
INTRODUCTION
1 On 28 October 2008, I granted, amongst other orders, an interlocutory injunction restraining the respondents identified in the schedule from failing to attend work and/or failing to perform work in the manner as customarily performed by the applicant. At that time I gave short oral reasons but indicated that I would provide more extensive written reasons in due course. These are those reasons.
2 The application concerns industrial action by 209 employees of the applicant at the North West Shelf LNG Phase V Expansion Project (Phase V Project). Those employees are the respondents to the application (the respondents).
3 The notice of motion seeks interlocutory relief against 85 of the respondents named in a schedule to the motion, being those respondents upon whom the applicant has been able to serve copies of the application, notice of motion and supporting material up to and including Sunday 26 October 2008. None of those served has entered an appearance.
4 The applicant’s case in support of the notice of motion is that:
(a) there is a serious question to be tried that the industrial action which has occurred is in breach of s 38 of the Building Construction Industry Improvement Act 2005 (Cth);
(b) having regard to the industrial action which has occurred and to the threats which have been made, there is a risk of further industrial action;
(c) the balance of convenience favours the grant of interim relief, the more so when regard is had to the strength of the applicant’s case.
5 The application is supported by the affidavits of Stuart Kenneth Macaree sworn 22 October 2008 and 27 October 2008, Damien Peter Swingler sworn 23 October 2008 and 24 October 2008. I have also had the benefit of detailed written and oral submissions which I generally accept and adopt for the purpose of these reasons. The Intervener made submissions broadly in line with those of the applicant.
BACKGROUND
6 On 11 September 2006 the applicant entered into a contract with Woodside Energy Limited (Woodside) to perform construction work on the Project under the management of Foster Wheeler Worley Parsons (Contract 6421).
7 At the time of entering into Contract 6421 the applicant entered into the following collective agreements to apply to the work:
4.2.1 CBI Constructors Pty Ltd North West Shelf LNG Phase 5 Expansion Project (AMWU) Collective Agreement 2006, lodged with the Workplace Authority Director on 15 August 2006;
4.2.2 CBI Constructors Pty Ltd North West Shelf LNG Phase 5 Expansion Project (CFMEU & AWU) Collective Agreement 2006, lodged with the Workplace Authority Director on 15 August 2006.
8 The agreements are relevantly identical and each has a nominal term which expires 3 years from the date of lodgement. Each of the collective agreements contain in it issue resolution procedures.
9 On 23 November 2007 Contract 6421 was varied to include the construction of a sixth stabilizer unit (S6 package). On 19 August 2008 Contract 6421 was varied to include the construction of a second vapour return line (VRL package).
10 The respondents were initially part of a larger workforce of 1200 engaged by the applicant to perform other work on the Phase V Project and elected to stay on when the other work finished to work on the S6 and VRL packages. They are variously engaged in the classifications of mechanical fitter, boiler makers, structural riggers, scaffolders, crane operators and storepersons.
11 The respondents were initially engaged on the Phase V Project pursuant to standard contracts of employment which referred to the conditions of the applicable collective agreement. Prior to their agreeing to stay on to work on the S6 and VRL packages the respondents were informed that the work was a continuation of the Phase V Project and that their conditions of employment would continue uninterrupted.
12 The vast majority of respondents are likely to be members of the Australian Manufacturing Workers Union (AMWU) or Construction, Forestry, Mining and Energy Union (CFMEU). Since at least 1 October 2008 the respondents, through their union representatives, have demanded that the applicant terminate their employment, pay out their redundancy entitlements taxed at concessional rates and then immediately reemploy them to continue to work on the S6 and VRL packages (the Demand). The respondents, through their union representatives, say this should occur because, in their opinion, the S6 and VRL work does not form part of the Phase V Project.
13 The applicant has refused the Demand and has repeatedly pointed out to the respondents:
(a) that the S6 and VRL work is part of the Phase V Project;
(b) that, in any event, if the applicant were to terminate the employees, pay out their redundancy entitlements and immediately reemploy them, it would be breaching federal taxation laws because the redundancy would not be bona fide: as to which see s 83-175 Income Tax Assessment Act 1997 and ATO draft ruling TR2008/D6;
(c) that the respondents will be no worse off if they are not paid their redundancy entitlements until the end of their employment on the Phase V Project because those entitlements will continue to accrue and will then be able to be paid out at concessional rates;
14 On 1 October 2008, AMWU organiser John Windus, while accompanied by CFMEU organiser Brad Upton, threatened unlawful industrial action if the Demand was not met.
15 On 13 October 2008, following a mass meeting of employees, Upton, accompanied by an AMWU and a CFMEU delegate, met with the applicant’s representatives and repeated the Demand. Upton then said that unless the applicant agreed to the Demand by the end of that day:
(a) there would be one week stoppage of work commencing on or about Tuesday, 14 October 2008;
(b) the employees would return to work for one day; and
(c) there would be a further one week stoppage if the redundancies sought were not given;
16 On 14 October 2008, 157 respondents engaged in industrial action by failing to attend work without authorisation. Later that day, Deputy President McCarthy of the Australian Industrial Relations Commission (AIRC) ordered those employees of the applicant who were members of the AMWU or CFMEU and engaged to work on S6 and the VRL packages to return to work and not engage in industrial action (AIRC Order). The AIRC Order came into effect at 4.00 pm on Tuesday 14 October 2008 and has a term of one month. The AIRC Order stated that it would be sufficient service on the employees if a copy of the order was faxed to the 2 unions and a copy was placed on the notice board(s) usually used for communicating with the employees. The applicant served the AIRC Order personally on 155 of the respondents and in the manner described in the AIRC Order that same day.
17 On 15 and 16 October 2008 the respondents performed work as normal.
18 From 17 to 24 October 2008 the respondents engaged in industrial action by failing to attend work without authorisation. Industrial action was engaged in on;
(a) 17 October 2008, by 166 respondents;(b) 18 October 2008, by 145 respondents;
(c) 20 October 2008, by 153 respondents;
(d) 21 October 2008, by 152 respondents;
(e) 22 October 2008, by 149 respondents;
(f) 23 October 2008, by 155 respondents;
(g) 24 October 2008, by 153 respondents.
19 On 25 October 2008 a substantial number of
respondents returned to work. However 42 respondents still failed to attend
work without
authorisation.
20 The respondents are required to work 10
hours each day. On that basis since 14 October, approximately 12,720 hours have
been
lost.
BUILDING CONSTRUCTION INDUSTRY IMPROVEMENT ACT 2005 (CTH)
21 The main object of the Building Construction Industry Improvement Act 2005 (Cth) ("BCII Act") is set out under s 3:
(1) The main object of this Act is to provide an improved workplace relations framework for building work to ensure that building work is carried out fairly, efficiently and productively for the benefit of all building industry participants and for the benefit of the Australian economy as a whole.
(2) This Act aims to achieve its main object by the following means:
. . .
(b) promoting respect for the rule of law;(c) ensuring respect for the rights of building industry participants;
(d) ensuring that building industry participants are accountable for their unlawful conduct;
. . .
22 Consideration of the main object is a relevant consideration to the construction and application of the provisions of the BCII Act: United Group Infrastructure Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2005) 148 IR 399 at [23]-[25]; Cahill v Construction Forestry Mining and Energy Union (No 2) [2008] FCA 1292 at [50]- [51].
23 Section 38 of the BCII Act provides that:
A person must not engage in unlawful industrial action.24 Section 37 of the BCII Act provides that "unlawful industrial action" is constituted by "building industrial action" that is:
(a) industrially-motivated; (b) a constitutionally-connected action; and (c) not an excluded action.25 The expressions "building industrial action", "industrially-motivated", "constitutionally-connected action", and "excluded action" are defined in s 36(1) of the BCII Act.
"Industrially motivated"
26 The expression "industrially-motivated" as used in s 37 is defined in s 36(1) of the BCII Act to mean:
motivated by one or more of the following purposes, or by purposes that include one or more of the following purposes:(a) supporting or advancing claims against an employer in respect of the employment of employees of that employer;. . .
(d) disrupting the performance of work.
27 The action engaged in by the respondents has been motivated by the Demand and, it may be inferred, to disrupt the performance of work. It therefore falls within paragraphs (a) and (d) of the definition.
"Constitutionally connected"
28 The expression "constitutionally-connected action" is defined in s 36(1) of the BCII Act to mean:
building industrial action that satisfies at least one of the following conditions: . . .(b) the action is taken by a constitutional corporation, or adversely affects a constitutional corporation in its capacity as a building industry participant;
(c) the action is taken in connection with an industrial dispute;
(d) the action relates to work that is regulated by a Commonwealth industrial instrument;
29 The applicant relies on paragraphs (b) (c) and (d) of the definition.
"Not excluded action"
30 Section 36(1) of the BCII Act defines "excluded action" to mean "building industrial action that is protected action for the purposes of the Workplace Relations Act".
31 The action is not protected action for the purposes of the WR Act. There is no bargaining period in place. See also s 41 BCII Act.
"Building industrial action"
32 Section 36(1) of the BCII Act defines "building industrial action" to include, amongst other things:
(d) a failure or refusal by persons to attend for building work or a failure or refusal to perform any work at all by persons who attend for building work; .
Paragraphs (e), (f) and (g) of the definition contain certain exceptions, none of which are relevant here.
33 The respondents in this case have failed or refused to attend for work.
"Building work"
34 "Building work" is defined in s 5 of the BCII Act to include:
(a) the construction, alteration, extension, restoration, repair, demolition or dismantling of buildings, structures or works that form, or are to form, part of land, whether or not the buildings, structures or works are permanent;
(b) the construction, alteration, extension, restoration, repair, demolition or dismantling of railways (not including rolling stock) or docks;
(c) the installation in any building, structure or works of fittings forming, or to form, part of land, including heating, lighting, air-conditioning, ventilation, power supply, drainage, sanitation, water supply, fire protection, security and communications systems;
(d) any operation that is part of, or is preparatory to, or is for rendering complete, work covered by paragraph (a), (b) or (c), for example:
(i) site clearance, earth-moving, excavation, tunnelling and boring;(ii) the laying of foundations;
(iii) the erection, maintenance or dismantling of scaffolding;
(iv) the prefabrication of made-to-order components to form part of any building, structure or works, whether carried out on-site or off-site;
(v) site restoration, landscaping and the provision of roadways and other access works; . . .
Paragraphs (e), (f) and (g) of the definition contain certain exceptions, none of which are relevant here.
35 Section 5(5) provides:
In this section: land includes land beneath water.36 The work which the respondents have been engaged to perform on the S6 and VRL Packages is within paragraphs (a) and (d) of the definition of "building work".
37 Section 5(1)(a) refers to "the construction of . . . structures or works that form, or are to form part of land, whether or not the . . . structures or works are permanent".
38 Subsection 5(5) indicates that "land includes land beneath water".
39 The terms "structures" and "works" are not defined.
40 The Macquarie Dictionary relevantly defines "structure" to mean "something built or constructed; a building, bridge, dam, framework, etc."
41 In EPM Concrete Pty Ltd v Building and Construction Industry Long Service Leave Payments Corp (1985) 23 IR 430 the definition of "building and construction work" in s 4 of the Building and Construction Industry Long Service Leave Payments Act 1974 (NSW) was considered. The definition relevantly included the carrying out of the construction of "structures, fixtures or works".
42 Lusher J at p 433 said:
The word "structure" is of course used in a variety of senses in a variety of acts and its meaning is related to the context in which it is used and the purpose of the act in question. The essence of the word is related to the verb to build. The Oxford Dictionary which sets out various senses in which it may be used states inter alia:-- "that which is built or constructed, a building edifice of any kind". It also states "more widely: a fabric or framework of material parts put together." In Cardiff Rating Authority v Guest Keen Baldwin Iron & Steel Co Ltd [1949] 1 KB 385 at 396 Denning, LJ, as he then was said: "A structure is something which is constructed but not everything which is constructed is a structure. A structure is something of substantial size which is built up from component parts and intended to remain permanently on a permanent foundation . . ."43 The S6 and VRL packages are on the evidence before me arguably "structures" for the purpose of s 5(1)(a) of the definition of "building work".
44 Further, each is arguably also capable of being regarded as "works" for the purpose of the definition. The Macquarie Dictionary defines the word "work" as inter alia "an engineering structure, as a building, bridge, dock, or the like".
45 The next question for the purpose of s 5(1)(a) of the definition is whether the S6 and VRL packages can be described as structures or works "that form, or are to form, part of land" (including land beneath water).
46 Whether something which is annexed to the land forms part of land is a question which commonly arises in determining the rights of the owner of land to things affixed to or embedded in the soil. When an object is said to become part of the land it will be subjected to the same rights of property as the land itself. The answer will generally depend on the degree and object of annexation.
47 The degree of annexation test looks to the manner in which the object is attached to the land. If the object is attached to the land, other than by its own weight, there is a rebuttable presumption that it forms part of the land. The greater the degree of annexation, the stronger the presumption. If on the other hand, the object is attached only by its own weight, there is a rebuttable presumption that it is not part of the land, even if it has become embedded in the soil. In such a case the onus lies upon the person claiming that the object forms part of the land to prove that it was erected with the intention that it should become part of the land: Reid v Smith [1905] HCA 54; (1905) 3 CLR 656 at 668, 673-4, 675-6; Belgrave Nominees Pty Ltd & Ors v Barlin-Scott Airconditioning (Aust) Pty Ltd [1984] VR 947 at 950-1. The courts will infer the degree of annexation from the surrounding circumstances including the nature of the object and the nature of the interest held in the land by the owner of the object. The test is objective, namely, what a reasonable person would consider to be the reason for attaching the object to the land.
48 That test is modified in the case of the statutory definition of "building work" in the BCII Act by the proviso that while the structures or works must form part of land, they need not be permanent.
49 On the evidence before me the S6 and VRL packages are arguably structures or works which will form part of land.
50 It follows from the above that the respondents have arguably engaged in unlawful industrial action in contravention of s 38 of the BCII Act. The applicant has demonstrated that there is a serious question to be tried in this respect.
SOURCE OF POWER TO GRANT AN INJUNCTION
Section 39 BCII Act
51 Section 39(1) of the BCII Act provides that:
"If, on application by . . . any . . . person, an appropriate court is satisfied that unlawful industrial action is:then the court may grant an injunction in such terms as the court considers appropriate.(a) occurring; or(b) threatened, impending or probable;
52 In the present case the applicant submits that further unlawful industrial action is threatened, impending and probable.
53 That further unlawful industrial action is "threatened" and "impending" may, so submits the applicant, be inferred from:
(a) the threats by Windas on 1 October 2008 and by Upton on 13 October 2008; and
(b) the fact that the respondents have carried out the first part of that threat, notwithstanding the AIRC order issued on 14 October 2008.
54 The meaning of the word "probable" depends on the context in which it is used.
55 In Johns v R [1980] HCA 3; (1980) 143 CLR 108 Stephen J said at 121:
"Probable" may bear a variety of meanings. As Lord Reid observed in delivering the judgement of the Board in The Wagon Mound (No. 2) (1967) 1 AC 617, at pp 634-635:"It is used with various shades of meaning. Sometimes it appears to mean more probable than not, sometimes it appears to include events likely but not very likely to occur, sometimes it has a still wider meaning and refers to events the chance of which is anything more than a bare possibility."
56 In R v Thomson [1997] 1 Qd R 623 Fitzgerald P said at 627-8:
"probable" is another word of variable import which takes its meaning from the context in which it is used . . . In Johns v. R [1980] HCA 3; (1980) 143 CLR 108, Stephen J seemed to accept at 121 that "probable" might sometimes be satisfied by "anything more than a bare possibility"; while, as will be seen below, sometimes the degree of probability required must be "overwhelming"; however, the more usual debate is whether "probable" requires more than a "real or substantial possibility" . . . . To complete the circle, just as the meaning of "likely" is sometimes expressed by reference to what is "probable", the meaning of "probable" is sometimes related to whether an event or consequence is "more likely than not" . . . Sometimes "probable" and "likely" are treated as synonymous; sometimes "probable" is regarded as a stronger word than "likely"; and sometimes "likely" is regarded as a stronger word than "probable". [references deleted]57 In the present case the applicant submits that having regard to:
further industrial action is "probable" in the sense that it is more than a "real or substantial possibility".(a) the threat made on 13 October 2008 (to engage in a one week strike, followed by a return to work and then another one week strike if the respondent’s Demand was not met);
(b) the fact that on the last occasion the respondents returned to work for 2 days, they followed that with a one week strike;
(c) the preparedness of the respondents to engage in industrial action in direct contravention of the AIRC order; and
(d) the fact that the respondent’s Demand has not been met;
58 Section 39(2) provides that:
If, in the opinion of the court it is desirable to do so, the court may grant an interim injunction pending determination of an application under subsection (1).59 Section 39(3) provides that:
The power of the court to grant an injunction restraining a person (the defendant) from engaging in conduct may be exercised:(a) whether or not it appears to the court that the defendant intends to engage again, or to continue to engage, in conduct of that kind; and
(b) whether or not the defendant has previously engaged in conduct of that kind; and
(c) whether or not there is an imminent danger of substantial damage to any person if the defendant engages in conduct of that kind.
60 Section 39(3) is in the same terms as s 80(4) of the Trade Practices Act 1974 (Cth). In ICI Australia Operations Pty Ltd v Trade Practices Commission [1991] FCA 527; (1992) 38 FCR 248 Lockhart J (with whom French J agreed) said at 256-7:
Subsections (4) and (5) of s 80 are novel because they empower the court to grant injunctive relief notwithstanding that the defendant has not previously engaged in the prohibited conduct or does not intend to engage in it again or to continue to engage in it or there is no imminent danger of substantial damage. Yet these are the traditional requirements for equitable injunctive relief. . . . In my opinion subss (4) and (5) are designed to ensure that once the condition precedent to the exercise of injunctive relief has been satisfied (ie contraventions or proposed contraventions of Pts IV or V of the Act), the court should be given the widest possible injunctive powers, devoid of traditional constraints, though the power must be exercised judicially and sensibly. . . . This does not mean that the traditional equitable doctrines are irrelevant. For example, it must be relevant to consider questions of repetition of conduct or whether it has ever occurred before or whether imminent substantial damage is likely: but the absence of any one or more of these elements is not fatal to the grant of an injunction under s 80. That is the effect of subss (4) and (5) (subs (4) in relation to the prevention of conduct and subs (5) in relation to a mandatory injunction). Their presence is not an indication of a new statutory house, rather an old house with some modern extensions.Gummow J at 267 came to essentially the same conclusion.
Section 49 BCII Act
61 Section 49(1) and (3) of the BCII Act empower the Court to grant injunctions (including interim injunctions) in relation to a person who has contravened a civil penalty provision. Subsection 49(6) defines an eligible person to make an application under s 49(1) and (3) to include a person affected by the contravention. The applicant is a person affected by the alleged contraventions. Section 38 is a civil penalty provision as defined in s 4. Thus, s 49(1) and s 49(3)(a) empower this Court on the present application, to make an interim injunction in relation to a person who has contravened s 38.
62 Section 49(3) confers power to grant an interim injunction without reaching a final decision that a contravention has occurred: Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 149 IR 299 at [7], [8]; Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 149 IR 306 at [52].
63 The power to grant an injunction, including an interim injunction, under s 49 is additional to the Court’s power under s 39 and, unlike the power in s 39, is not predicated on the Court’s satisfaction that unlawful industrial action is occurring or is threatened, impending or probable. Rather, the Court may make any order "that it considers appropriate".
64 Significantly, as with subsection 39(3), subsection 49(4) also provides that:
(4) If the contravention is a contravention of section 38, then the power of the court to grant an injunction restraining a person (the defendant) from engaging in conduct may be exercised:
(a) whether or not it appears to the court that the defendant intends to engage again, or to continue to engage, in conduct of that kind; and
(b) whether or not the defendant has previously engaged in conduct of that kind; and
(c) whether or not there is an imminent danger of substantial damage to any person if the defendant engages in conduct of that kind.
65 The Court also has power to make interlocutory orders under s 23 of the Federal Court of Australia Act 1976 (Cth): Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; (1999) 91 FCR 463 at 480-1.
66 While the power to grant an interim injunction under s 49(3) should be exercised having regard to the principles applied by a court of equity, the main object of the BCII Act is also relevant consideration in applying its provisions: United Group Infrastructure Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2005) 148 IR 399 at [23]-[25].
67 In my view, the applicant has a strong prima facie case and the balance of convenience is all one way.
68 The effect on the applicant if there is further industrial action will be significant. The estimated wasted costs alone exceed $600,000 a week. There are further potential consequences of industrial action such as damage to the applicant’s reputation and loss of production.
69 The impact on third parties, in this case Woodside, is a relevant consideration: Patrick Stevedores Operations Pty Ltd v Maritime Union of Australia (1998) 82 IR 87 at 99-100.
70 Further the proper formulation of the test is not whether damages are an adequate remedy but whether it is just in all the circumstances that the plaintiff should be confined to his remedy in damages. The courts have recognised there may be cases in which it is unjust to confine a plaintiff to its remedy in damages because of, for example, the difficulty in estimating damages and damages which cannot be taken into monetary account such as loss of goodwill and trade reputation: Belgrave Nominees Pty Ltd v Barlin-Scott Airconditioning Pty Ltd [1984] VR 947 at 954-5, citing Evans Marshall & Co Ltd v Bertola SA and Sherry Imports Ltd [1973] 1 WLR 349.
71 In this case it may well be difficult for the applicant to quantify its damage to reputation and for Woodside to quantify any loss of production attributable to the industrial action engaged in by the respondents. Further, it is unlikely the respondents would have the capacity to pay any substantial damages caused by delays or production losses. It is estimated that the S6 package, once completed, will produce 23,000 barrels per day of condensate with a value of $75 per barrel. This translates to $1.725 million of product a day.
72 On the other hand, if the respondents are restrained from engaging in further industrial action they will be paid in accordance with their collective agreements, which is not a detriment.
73 It is also relevant that, in addition to being unlawful by virtue of s 38 of the BCII Act, the industrial action in which the respondents have engaged in to date has been:
(a) in breach of s 494 of the WR Act; and
(b) since 17 October, in breach of the s 496 order issued by Deputy President McCarthy of the AIRC on 14 October.
74 It is also relevant to the exercise of the Court’s discretion that the Demand is for the applicant to engage in conduct which is arguably in contravention of s 83-175 of the Income Tax Assessment Act 1997 (Cth): see also ATO draft ruling TR2008/D6.
75 The fact that the respondents have presently returned to work is not in this case a reason not to grant the injunction sought. First, on the last occasion on which employees returned to work, they did so for 2 days and then commenced a further 7 day strike. Second, the threat made by Upton on 13 October 2008 was of a one week strike followed by a return to work and then a further one week strike if the Demand was not met. Third, the applicant has not been given any assurances by the AMWU, the CFMEU or any of the respondents as to the basis of the return to work or for how long they are returning to work.
76 In Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 154 IR 228 Le Miere J, in circumstances similar to the present, granted an injunction under the BCII Act, notwithstanding that the workers had returned to work:
77 In John Holland Pty Ltd v Construction, Forestry, Mining and Energy Union (2005) 144 IR 418 the defendant submitted that because the industrial action had stopped the plaintiff needed to show that there was a "strong probability" that the defendants’ conduct would be the cause of serious damage, the threat of injury was immediate and substantial, and damages would not be a sufficient or adequate remedy if the damage did occur. In rejecting that submission and granting an interlocutory injunction, Le Miere J said at [77]:
The degree of probability of future injury is not an absolute standard. What is to be aimed at is justice between the parties, having regard to all the relevant circumstances: Hooper v Rogers at 50 per Russell LJ followed by the Full Federal Court in Magic Menu Systems Pty Ltd v AFA Facilitation Pty Ltd at 269-270. Provided that there is a real risk of wrongful conduct which would cause injury which is more than trivial, there may be no good reason to refuse quia timet relief . . .78 Similarly in United Group Infrastructure the Court granted interim injunctions notwithstanding that the employees had returned to work. Nicholson J said at [44] that he was particularly influenced by the judgment in Kestrel Coal Pty Ltd v Construction, Forestry, Mining and Energy Union [2001] 1 Qd R 634 at [22]–[30] particularly at [22], [28] and [30].
79 In Kestrel Coal Chesterman J said at [30]:
This is not a case of idle threats. The defendants have in the past acted unlawfully in violation of the plaintiffs’ rights. This factor makes the case different from those in which an injunction is sought because of conduct which is only apprehended. The principles applicable to quia timet injunctions are not entirely applicable. The fact that unlawful conduct has occurred makes the court more disposed towards ordering relief. See Dean and Chapter of Chester v Smelting Corporation Limited (1901) 85 LT 67 at 69 and Attorney-General v Beck [1980] 2 NSWLR 77 at 94–95.80 This also is not a case of idle threats. The respondents have made good their threat to engage in a week of industrial action and, on 13 October, threatened further industrial action if the Demand is not met. Further, the respondents have shown a preparedness to engage in industrial action in contravention of the AIRC Order. In all the circumstances, and having regard to the main object of the BCII Act, it is just that the respondents should be restrained from engaging in further industrial action until the application can be heard or further order.
Associate:
Dated: 31
October 2008
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Solicitor for the Applicant:
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Mallesons
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Counsel for the Respondents:
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No appearance
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Counsel for the Intervener:
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Mr S D Harben
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Solicitor for the Intervener:
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Clayton Utz
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URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/1629.html