John Porter v Environmental Recovery Services Ltd [1995] IRCA 147

IN THE INDUSTRIAL RELATIONS ) No. WI 356 of 1994 COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) BETWEEN: John Porter Applicant AND: Environmental Recovery Services Limited Respondent

BEFORE: Boon JR PLACE: Perth HEARING DATE: 14 February 1995 JUDGMENT DATE: 12 April 1995

REASONS FOR JUDGMENT

In this matter an application made in respect of the termination of the employment of the applicant was filed on 5 September 1994. A supporting affidavit by the applicant states at paragraph 1 (g) that: "1 (g) the date in which the employee received written notice of the termination was: none given". It is, however, now common ground that written notice of termination was given by the respondent to the applicant by letter dated 30 May 1994. By notice of motion filed 9 December 1994 the respondent seeks orders that: 1. the applicant's application dated 5 September 1994 be struck out for want of jurisdiction; 2. the applicant to pay the respondent's costs of this application to be taxed if not agreed.

The matter went to a Directions Hearing before Judicial Registrar Wheeler on 9 December 1994 who ordered that the applicant's application for an extension of time be filed within 7 days, and that the respondent's Notice of Motion be heard together with any application for extension of time. The applicant's amended application under Section 170EA of the Industrial Relations Act 1988 seeks: "1 (a) an order declaring the termination of the employer's employment of the employee to have contravened Division 3 of Part VIA of the Industrial Relations Act 1988 ('the Act"); (b) an order that the respondent pay compensation to the employee in respect of the following: i) damages for breach of contract; ii) damages for unfair dismissal; iii) unpaid production bonus at the rate of 3 cents per litre from 1 April 1990 (the date the still was fully operational)". An affidavit filed by the applicant states that the amount claimed by way of unpaid production bonus is some $60,000. Affidavits have been filed by both parties. They show that the applicant was employed by Solvent Waste Distillers of W.A. as a Plant Operator/Manager under an agreement comprised of a letter dated August 20 1990. The respondent took over the operations of Solvent Waste Distillers in September 1993. Between 10 May 1994 and 30 May 1994 the parties exchanged correspondence. Letters from the respondent and its solicitors notified the applicant of a change in working conditions as a result of a restructuring of the respondent's branch operation. Letters from the applicant and his solicitors stated that the applicant did not accept the respondent's proposed variations to his employment conditions; alleged a breach of contract by the respondent; sought reinstatement to the applicant's original position, and sought payment of the production bonus. By letter dated 30 May 1994 the applicant's employment was terminated. The applicant's solicitors by letter dated 20 June 1994 stated in part that: "We are of the opinion that our client has been unfairly dismissed, without reasonable notice, in addition to breach of contract by the company. Our client has instructed us to issue proceedings in respect of the above. Kindly advise whether you have instructions to accept service". The respondent heard nothing further in the matter until it was served with the substantive application in September 1994. By 29 June 1994 the respondent had appointed another person to the applicant's former position. By letter dated 15 September 1994 to the applicant's solicitors the respondent's solicitors raised the question that the application was filed out of time. However, it was not until Judicial Registrar Wheeler at the Directions Hearing on 9 December 1994 ordered that an application for extension of time be filed by the applicant that this was done. Counsel for the applicant stated at the hearing before me that when the substantive application was filed it was always envisaged that an application for extension of time would be filed. However, this was not done until 16 December 1994, more than three months after the filing of the substantive application. Affidavits were filed on behalf of the applicant in support of his application for an extension of time. The principal affidavit is that of a partner in the firm of solicitors formerly acting for the applicant. It states that one solicitor at the firm initially had the carriage of the matter. She left in July 1994 to go overseas on leave for an extended period and has not yet returned. The matter was then handled by another solicitor until it was passed to the applicant's present solicitor in mid-August 1994. At all times the relatively junior solicitors were under the partners' supervision. The applicant first attended for legal advice on 10 May 1994 and on 31 May 1994; the applicant instructed his former solicitor to commence proceedings for unfair dismissal. The applicant instructed his solicitors to make an application for legal aid and this was done by an application dated 20 June 1994. Aid was refused initially on 28 July 1994 and then was rejected on reconsideration on 19 September 1994 and finally by the Review Committee on 23 December 1994. The affidavit states that the applicant's former solicitor had considered commencing an action for unfair dismissal on behalf of the applicant in the District Court of Western Australia and drafted an appropriate writ of summons and statement of claim. These were sent to the applicant on 13 July 1994. Proceedings were, however, not initiated in the District Court of Western Australia and "on review of the matter a decision to commence proceedings in the Federal Industrial Relations Court for unfair dismissal was made." The affidavit states that "the cause of delay to the extent that there was resulted from the analysis of the applicant's rights and the determination of the appropriate cause of action and jurisdiction". An affidavit by the applicant's present solicitor states that she took over the carriage of this matter whilst in the employ of the applicant's former solicitors on 11 August 1994. She first spoke to the applicant's wife by telephone on 16 August 1994 and attended on the applicant and his wife on 24 August 1994 and 31 August 1994. She drafted an application under S170 EA of the Industrial Relations Act and accompanying affidavit and filed the same on 5 September 1994. She states that "given the complexity of the matter the delay has not been unreasonable". An affidavit by the applicant states that he had been waiting for his pay slip and that by 21 June 1994 he had still not been given his pay slip by his employer. He states that the prejudice he would suffer if this application for an extension of time were not granted would be great. The action has already proceeded for some months and has already been before the Industrial Relations Commission for conciliation. He states that the matter is almost ready to be entered for trial and that much of the work that has already been done by both sets of solicitors may well be wasted. Section 170EA(3) of the Industrial Relations Act 1988 states: "3. Time limit for applications: An application must be made: (a) within 14 days after the employee receives written notice of the termination; or (b) within such further period as the court allows on an application made during or after those 14 days." The applicant submits that a broad discretion exists in the court to extend time and that in the exercise of that discretion the court should have regard to the merit of the matters put forward by the applicant and the prejudice to each party in extending or not extending time (Hudson v Princetown Pty Ltd, VI 657 of 1994 per Parkinson J.R.). The applicant contends that the respondent has not been prejudiced by the late filing of the application whereas the prejudice the applicant would suffer if the extension of time were not granted would be great. In Pam Coker-Godson v National Dairies Ltd VI No. 262 at 94, Keely J referred to the principles listed by Wilcox J at p 348-349 of Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FLR 344 relating to an exercise of discretion under section II of the Administrative Decisions (Judicial Review) Act. His Honour stated: "1. Although the section does not, in terms, place any onus of proof upon an applicant for extension an application has to be made. Special circumstances need not be shown but the court will not grant the application unless positively satisfied that it is proper so to do. The "prescribed period" of twenty-eight days is not to be ignored (Ralkon Agricultural Co Pty Ltd v Aboriginal Development Commission (1982) 43 ALR 535 at 550). Indeed, it is the prima facie rule that proceedings commenced outside that period will not be entertained (Lucic v Nolan (1982) 45 ALR 411 at 416). It is a pre-condition to the exercise of discretion in his favour that the applicant for extension show an "acceptable explanation of the delay" and that it is "fair and equitable in the circumstances" to extend time (Duff at 485; Chapman v Reilly unreported (Federal Court of Australia, Neaves J., 9 December 1983) at 7). 2. Action taken by the applicant, other than by making an application for review under the Act, is relevant to the consideration of the question whether an acceptable explanation for the delay has been furnished. A distinction is to be made between the case of a person who, by non-curial means, has continued to make the decision-maker aware that he contests the finality of the decision (who has not "rested on his rights": per Fisher J in Doyle v Chief of Staff (1982) 42 ALR 283 at 287) and a case where the decision-maker was allowed to believe that the matter was finally concluded. Compare Doyle, Chapman, Ralkon and Douglas v Allen (1984) 1 FCR 287 with Lucic at 414-415 and Hickey v Australian Telecommunications Commission (1983) 48 ALR 517 at 519. The reasons for this distinction are not only the "need for finality in disputes" (see Lucic at 410) but also the "fading from memory" problem referred to in Wedesweiller v Cole (1983) 47 ALR 528. 3. Any prejudice to the respondent including any prejudice in defending the proceedings occasioned by the delay is a material factor militating against the grant of an extension: see Doyle at 287, Duff at 484-485, Hickey at 525-527 and Wedesweiller at 533-534. 4. However, the mere absence of prejudice is not enough to justify the grant of an extension: Douglas, Lucic at 416, Hickey at 523. In this context, public considerations often intrude (Lucic, Hickey). A delay which may result, if the application is successful, in the unsettling of other people (Ralkon at 550, Becerra at 12-13) or of established practices (Douglas) is likely to prove fatal to the application. 5. The merits of the substantial application are properly to be taken into account in considering whether an extension of time should be granted: Lucic at 417, Chapman at 6. 6. Considerations of fairness as between the applicants and other persons otherwise in a like position are relevant to the manner of exercise of the court's discretion: Wedesweiller at 534-535." Keely J stated in Pam Coker-Godson v National Dairies Ltd (without deciding the question) that the wording of S170 EA (3) is such that it may well be easier for an applicant, under that sub-section, to persuade this court to allow a "further period" than it is for an applicant, under S II of the Administrative Decisions (Judicial Review) Act, to persuade the Federal Court on the principles distilled by Wilcox J. In the present case, the applicant received written notice of termination on 30 May 1994. An application was not filed until 5 September 1994, more than 3 months outside the fourteen day time limit prescribed by S170 EA. An application for an extension of time was not filed until 16 December 1994, more than 3 months after the filing of the application. The primary reason put forward for the delay seems to be that the applicant's solicitors took a considerable time to analyse the applicant's rights and determine the appropriate cause of action and jurisdiction. McInerney J in Grumble v Killingsworth (1970) VR 161 at p176 stated that in most cases the courts have held that the client cannot disassociate himself from the delay of his solicitor and that the sins, by way of omission or delay, of his solicitor must be visited on the client. His Honour stated, however (at p 176):

"on the other hand, in cases where the question has been whether there was reasonable cause for the applicant's failure to give the notice of action formerly required by S34 of the Limitation of Actions Act 1958, the courts have held that reasonable cause was shown where the applicant had instructed an apparently competent solicitor but that solicitor had failed to give the notice". The reasons given for delay are not in my view adequate to explain the lack of action by the applicant's solicitors. I am reluctant, however, to dismiss the application on that ground alone as the applicant instructed his solicitors on 31 May 1994 to commence proceedings. Another reason given for the delay is that it took some time for the applicant's legal aid application to be processed. As Fitzgerald J states in Lucic v Nolan (1982) 45 ACR 411 at 417: "I am quite unpersuaded that an absence of legal aid at any time impeded the relatively formal step of the filing of an application which could later be expanded". Similarly, Lord Denning M R in Baker v Bowketts Cakes Ltd (1966) IWCR 861 at p865 considered that in considering whether to extend time "we must ignore legal aid"." As to the second of the principles listed by Wilcox J, in this case the applicant himself and through his solicitors, made it clear in the time leading up to termination that he did not accept the proposed variations to this contract of employment. By letter dated 20 June 1994, the respondent was advised that the termination would be challenged. The letter refers to unfair dismissal and breach of contract, but was sent to the respondent after the prescribed time period for filing an application under S170 EA had expired.

As to the third principle set out by Wilcox J, the respondent's submissions state that the prejudice that the respondent will suffer if the application for extension is granted is as follows: (a) it has been denied the opportunity to take statements from potential witnesses immediately after the termination on 30 May 1994 whilst the events were fresh in their minds; (b) some potential witnesses reside outside of the State of Western Australia and would need to be flown in from the Eastern States and South-East Asia; (c) the position of plant operator previously held by the applicant has been filled; (d) the respondent does not readily have access to the persons, or documents of Worton Services Pty Ltd, trading as Solvent Waste Distillers in Western Australia, the employer who first entered into the contract of employment with the applicant and who set the terms and conditions of such employment on or about August 1990 (see paragraphs 5 to 7 (inclusive) of the applicant's affidavit sworn 16 December 1994). The applicant is no longer seeking reinstatement so the fact that the position of plant operator previously held by the applicant has been filled no longer appears to have bearing on the matter. I am, however, satisfied that the delay will to some extent prejudice the respondent. If an extension of time is granted this is not a case where public considerations are likely to intrude in that other people are not likely to be unsettled, for the applicant is not claiming reinstatement. It is the intention of the legislation, however, that applications under S170 EA are dealt with expeditiously.

As to the fifth of the points raised by Wilcox J, the merits of the substantial application are particularly relevant in this case. The substantial application claims damages for breach of contract, damages for unfair dismissal, the unpaid production bonus and interest. By S170 EA (1) the employee may apply to the court for "a remedy in respect of termination of his or her employment". Under S170 EE (2) "if the Court thinks .... reinstatement is impracticable, the Court may make an order requiring the employer to pay to the employee compensation of such amount as the Court thinks appropriate". By sub-S 170 EE (3): "(3) Amount of Compensation: In working out the amount of the compensation for the purposes of the subsection (2) the Court is to have regard to the remuneration that the employee would have received, or would have been likely to have received, if the employer had not terminated the employment...." It seems to me that if this matter were to be proved, the main part of the applicant's claim, namely the amount of unpaid production bonus going back some years, may be doomed to fail as it does not come within the provisions of the Act relating to compensation. The amount claimed goes beyond the limits of this court's jurisdiction under the Industrial Relations Act. The applicant has found other employment and his solicitor's affidavit makes it clear that it is not disputed that the respondent paid 4 weeks pay in lieu of notice. The bulk of the breach of contract alleged dates back to 1990, some four years before the time the present provisions of the Act came into effect. In the case of Ardino v Count Financial Group Pty Ltd (1994) 126 ALR 49 Wilcox CJ held that ordinarily, a contract claim which arises out of the same substratum of facts as an unlawful termination could be litigated in the court, in reliance on S430 of the Industrial Relations Act. For the associated jurisdiction to arise, however, the statutory claim must be bona fide and arguable. In the case before me I do not consider that the bulk of the breach of contract claim arises out of the same substratum of facts as the unlawful termination claim and it would not be appropriate for the court to hear the matter under its accrued jurisdiction. In assessing prejudice to each party I have had regard to the fact that a District Court Writ of Summons and Statement of Claim have already been drafted by the applicant's solicitors. In balancing these competing factors, I do not consider it appropriate to exercise my discretion in favour of the applicant. The notice of motion by the applicant seeking an extension of time is dismissed. As to the question of costs, Moore J in the case of Canceri v Taylor (1994) 55 IR 31 found that this court has power to make an order for costs though the exercise of that power is limited by S347 to cases in which a party instituted the proceedings vexatiously or without reasonable cause. In this instance I am not satisfied that the applicant commenced the proceedings vexatiously or without reasonable cause and I am not prepared to make an order for costs.

I certify that this and the preceding ten (10) pages are a true copy of the Reasons for Judgment of Judicial Registrar Boon. Associate: Date:

Solicitors for the Applicant: G. Porter & Associates Counsel for the Applicant: Ms N. Mikhael Solicitors for the Respondent: Jackson McDonald Counsel for the Respondent: Ms M. Saraceni Date of Hearing: 14 February 1995. Date of Judgment: 12 April 1995

IN THE INDUSTRIAL RELATIONS ) No. WI 356 of 1994 COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) BETWEEN: John Porter Applicant AND: Environmental Recovery Services Limited Respondent

BEFORE: Boon JR PLACE: Perth HEARING DATE: 14 February 1995 JUDGMENT DATE: 12 April 1995 MINUTES OF ORDER

THE COURT ORDERS THAT: 1) The Applicant's application to extend the time for the making of the Applicant's substantive application up to and including 5 September 1994 be dismissed.

2) The Applicant's substantive application dated 5 September 1994 be struck out. 3) There be no order as to costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Industrial Relations Court rules.

CATCHWORDS

INDUSTRIAL LAW - Termination of employment - claim of unlawful termination - application filed out of time - application to strike out for want of jurisdiction - application for extension of time - application dismissed.

INDUSTRIAL RELATIONS ACT 1988 SS 170EA, 170EE Hudson v Princetown Pty Ltd, VI 657 of 1994, Parkinson JR Pam Coker-Godson v National Dairies Ltd, VI 262 of 1994, Keely J Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FLR 344 Grumble v Killingsworth (1970) VR 161 Lucic v Nolan (1982) 45 ACR 411 Ardino v Count Financial Group Pty Ltd (1994) 126 ALR 49 Canceri v Taylor (1994) 55 IR 31 JOHN PORTER v ENVIRONMENTAL RECOVERY SERVICES LTD No. WI 356 of 1994 BEFORE: Boon JR PLACE: Perth HEARING DATE: 14 February 1995 JUDGMENT DATE: 12 April 1995