FMV v TZB [2019] NZCA 282

FMV v TZB [2019] NZCA 282 [4 July 2019]NOTE: HIGH COURT ORDER PROHIBITING PUBLICATION OF NAMESAND IDENTIFYING PARTICULARS OF THE PARTIES EXCEPT INACCORDANCE WITH THE INTITULING OF THIS JUDGMENT REMAINSIN EFFECT.IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA320/2018[2019] NZCA 282BETWEEN FMVAppellantAND TZBRespondentHearing: 13 February 2019Court: Miller, Simon France and Peters JJCounsel: A D Sharp for AppellantT L Clarke and H J Musgrave for RespondentJudgment: 4 July 2019 at 2.00 pmJUDGMENT OF THE COURTA The appeal is dismissed.B Ms FMV must pay TZB's costs for a standard appeal on a band A basis withusual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Peters J)Introduction[1] The appellant, Ms FMV, was employed by the respondent, TZB, betweenFebruary 2009 and January 2010, when she resigned.[2] Until recently, Ms FMV had two sets of proceedings against TZB on foot, onein the High Court (CIV 3267) and the other in the Employment Relations Authority(Authority).1 In May 2018, and on TZB's application, Brewer J struck out CIV 3267and made the findings and/or orders giving rise to this appeal by Ms FMV. The agreedissues on appeal are:2(a) whether the Judge was correct to determine that the High Court did nothave jurisdiction to determine CIV 3267;(b) whether the Judge was correct to hold the High Court would not havejurisdiction even if Ms FMV were to amend her statement of claim inCIV 3267 to allege that TZB was liable in tort for breaching itsstatutory duties to her under the Health and Safety in Employment Act1992 (HSEA);(c) whether the Judge erred in finding that, if he were wrong as to (a) or(b), CIV 3267 constituted an abuse of process; and(d) whether the Judge acted on a wrong principle in granting permanentname suppression.Background[3] Ms FMV filed her notice of proceeding and statement of claim in CIV 3267 on22 December 2016. Ms FMV alleges that TZB, as her employer, owed her duties ofcare as regards the work she was required to perform and her working environment;to operate a safe system at work, and to ensure her health and safety at work; and to1 FMV v TZB [2018] NZHC 1131 [High Court Decision]; and FMV v TZB [2017] NZERA Auckland112 [Authority Determination].2 Court of Appeal (Civil) Rules 2005, r 42A(1).communicate with her in a full and frank manner. She alleges that TZB breached theseduties, causing loss for which she seeks damages.[4] The next day, on 23 December 2016, Ms FMV commenced proceedingsagainst TZB in the Authority. The Authority stayed this proceeding on 12 April 2017,for reasons to do with Ms FMV's health.3 The Authority also suppressed publicationof the parties' names.[5] On 20 December 2017, so almost a year later and just inside the one-yearperiod for service provided for in r 5.72(2) of the High Court Rules 2016, Ms FMVserved TZB with the notice of proceeding and statement of claim in CIV 3267.[6] On 21 February 2018, TZB applied to the High Court to strike out CIV 3267on the ground that the issues in the proceeding were in the Authority's exclusivejurisdiction. If it were wrong in that, TZB applied to strike out on the ground thatCIV 3267 was an abuse of process. TZB also sought permanent name suppression.Brewer J granted these applications, hence the appeal.Standard on appeal[7] Subject to the issue as to suppression, this appeal is by way of rehearing.4Ms FMV is entitled to this Court's view of questions of fact, law, and degree.5[8] The decision to grant permanent name suppression involved the exercise ofdiscretion.6 Accordingly, Ms FMV is required to:7... demonstrate that the Court below acted on a wrong principle, took intoaccount some irrelevant matter or failed to take into account some relevantmatter, or made a decision that was plainly wrong.3 Authority Determination at [33], citing Employment Relations Act 2000, s 160(1)(f) and 173(1).4 Court of Appeal (Civil) Rules, r 47.5 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141 at [16].6 Y v Attorney-General [2016] NZCA 474, [2016] NZAR 1512 at [24], citing May v May (1982)NZFLR 165 (CA) at 170. See also Opthamlogical Society of New Zealand Inc v CommerceCommission [2003] 2 NZLR 145 (CA) at 13; and Blackstone v Blackstone [2008] NZCA 312 at[8].7 Rochford v Attorney-General [2008] NZAR 404 at [17].Jurisdiction[9] The Authority has exclusive jurisdiction in respect of the matters reserved to itby s 161 of the Employment Relations Act 2000 (ERA). Those parts of s 161 relevantto this appeal are as follows:161 Jurisdiction(1) The Authority has exclusive jurisdiction to make determinations aboutemployment relationship problems generally, including—(b) matters related to a breach of an employment agreement:(e) personal grievances:(r) any other action (being an action that is not directly withinthe jurisdiction of the court) arising from or related tothe employment relationship or related to the interpretation ofthis Act (other than an action founded on tort):...(3) Except as provided in this Act, no court has jurisdiction in relation toany matter that, under subsection (1), is within the exclusivejurisdiction of the Authority.[10] "Employment relationship problem" is defined in s 5:employment relationship problem includes a personal grievance, a dispute,and any other problem relating to or arising out of an employmentrelationship, but does not include any problem with the fixing of new termsand conditions of employment[11] "Employment agreement" is also defined in s 5 and "employment relationship"includes the relationship between an employer and his, her or its employee.8 There isno dispute that there was an employment agreement between Ms FMV and TZB andthat they were in an employment relationship.8 Employment Relations Act 2000, s 4(2)(a).JurisdictionSubmissions[12] Mr Sharp, counsel for Ms FMV, submitted to the Judge, and to us, thatthe claim in CIV 3267 is not within the Authority's (exclusive) jurisdiction because itis an "action founded on tort" and therefore excluded by the final words in s 161(1)(r).[13] The gist of Mr Sharp's submission is that the Authority does not have, andindeed never has had, jurisdiction to determine a cause of action in tort. Moreover, tothe extent that an employee might sue their employer for breach of a term ofthe employment contract or in tort, as in this case, the employee may elect to proceedin the Authority on the contract or in the High Court on the tortious cause of action.In support of this submission, Mr Sharp referred us to Caldwell v Croft Timber Co Ltd,in which Paterson J declined to strike out Mr Caldwell's claim in the High Courtagainst his employer for exemplary damages and other relief, saying:9An employer's duty of care to an employee and, in particular, his duty toprovide a safe workplace for employees, gives rise to an obligation, a breachof which may support an action in tort or for breach of an implied term ofthe contract of employment. It is frequently pleaded under both alternativeswithout exception being taken. Normally it makes no difference whetherthe plaintiff brings his action in tort or breach of contract. However, in thisparticular case it does.If Mr Caldwell brings his action in contract based on a breach of an impliedterm, it is clearly within the exclusive jurisdiction of the Employment Court.If, as he has done in this case, he frames it in tort, it is not within the exclusivejurisdiction of that Court.The second cause of action is breach of statutory duty. Such a claim isa tortious claim. It is therefore not within the exclusive jurisdiction ofthe Employment Court.[14] In reliance on these passages, Mr Sharp submits that the relevant issue iswhether the cause of action is in tort "[e]ven if the underlying basis of the arrangementbetween the parties is one of an employment contract".10[15] Additionally, before Brewer J and before us, Mr Sharp raised the possibilitythat Ms FMV might amend her claim to plead another case in tort, to the effect that9 Caldwell v Croft Timber Co Ltd [1997] ERNZ 136 at 143.10 At 143.TZB had breached statutory duties owed to her under the HSEA. Mr Sharp submittedthat such a claim would clearly be outside the Authority's exclusive jurisdictionbecause s 161(1) does not make any provision for the Authority to determine sucha claim.[16] Mr Clarke, for TZB, submitted that the Authority has exclusive jurisdiction todetermine an "employment relationship problem". He submitted that Ms FMV'sclaim is such a problem and in fact falls within the specific categories in ss 161(1)(b),(e), and the opening words of (r). Mr Clarke submitted that the critical issue is whetherthe claim does concern an employment relationship problem, and not the cause ofaction pleaded. Brewer J accepted Mr Clarke's submission.Discussion[17] The opening words of s 161(1) give the Authority exclusive jurisdiction todetermine "employment relationship problems generally". Such problems includethe types of dispute listed in s 161(1).[18] Mr Sharp is correct that traditionally the Authority did not have jurisdiction todetermine claims that were framed in tort. This is because predecessor legislation tothe ERA limited its jurisdiction to claims founded on an employment contract.For instance, Caldwell to which we have referred was decided under the EmploymentContracts Act 1991, s 3(1) of which provided:This Act shall apply to all employment contracts and the Tribunal and[Employment] Court shall, subject to the provisions of this Act, have exclusivejurisdiction to hear and determine any proceedings founded on an employmentcontract.[19] The position changed under the ERA, with the foundation of jurisdictionbecoming whether the matter to be determined is an employment relationship problem.In JP Morgan Chase Bank NA v Lewis, this Court held that an employmentrelationship problem is one that "directly and essentially concerns the employmentrelationship" and that the essence of the claim must be employment related.11On the other hand, the claim should not be regarded as within the Authority's11 JP Morgan Chase Bank NA v Lewis [2015] NZCA 225, [2015] 3 NZLR 618 at [95] and [96].jurisdiction if the employment relationship is not a necessary component ofthe claim.12[20] Brewer J was satisfied that Ms FMV's claim in CIV 3267 was whollydependent on her former employment relationship with TZB, and that it therefore fellwithin the Authority's exclusive jurisdiction and outside the exception for tort ins 161(1)(r).[21] We agree. In CIV 3267 Ms FMV seeks relief for what she alleges was TZB'sfailure to meet its obligations as employer to her as its employee. Also, as the Judgesaid, much of what is pleaded in CIV 3267 replicates word for word the equivalent"statement of problem" in the Authority. In the words of JP Morgan, CIV 3267"directly and essentially concerns the employment relationship" and the essence ofthe claim is employment related. Moreover, the employment relationship is anecessary component of the claim.[22] Given these matters, Brewer J was correct to strike out CIV 3267 for want ofjurisdiction.Abuse of process[23] Strictly speaking this conclusion makes it unnecessary for us to considerthe issue of whether Ms FMV's proceeding in the High Court was/is an abuse ofprocess. That said, Brewer J was correct on this matter also. The Judge was satisfiedthat both proceedings traversed identical issues. The statement of claim in CIV 3267did not introduce any substantive issue not otherwise addressed in the statement ofproblem.[24] Ms FMV submitted that, if the Judge found the proceedings were a duplication,he should not strike out those in the High Court, as that was filed before the proceedingbefore the Authority. The Judge was not persuaded by that submission. He consideredthat Ms FMV had chosen to progress her proceeding in the Authority beyond that inCIV 3267, notwithstanding the latter was filed first. That being Ms FMV's choice,the Judge thought she should not be allowed to resile from it. Nor was the Judge12 At [97].persuaded that Ms FMV would be disadvantaged by a strike out of the High Courtproceeding. Again, we agree.[25] Mr Sharp referred us to Beattie v Premier Events Group Ltd.13 In that case,the employer, Premier Events, commenced separate proceedings in the Authority andin the High Court against former employees and/or directors of Premier Events.[26] The defendants in the High Court applied to strike out the High Courtproceeding on the ground that it was an abuse of process for Premier Events to haveproceedings on foot in both jurisdictions, and that they were being "vexed" twice inrespect of the same subject matter.[27] In the High Court, Ellis J declined to strike out the claim.14 This was becausethe issues in the two proceedings were different. The defendants to each proceedingwere sued in different capacities, and in respect of different (alleged) wrongs in respectof which the Authority did not have jurisdiction.15 This Court upheld Ellis J'sdecision.16[28] This case is different from Premier Events because the parties sue and are suedin the same capacity, and in respect of the same issues. This difference explainsthe different decisions.Suppression[29] The Authority made an order for suppression on 12 April 2017.17[30] Davison J made an interim order for suppression in CIV 3267 on 19 March2018. 18 On TZB's application, Brewer J made that order permanent, on the groundsthat it would be wrong in principle to undo the Authority's order in a High Courtproceeding that ought not to have been brought.1913 Beattie v Premier Events Group Ltd [2014] NZCA 184, [2015] NZAR 1413.14 Premier Events Group Ltd v Beattie [2013] NZHC 2755 at [24].15 At [18]16 Beattie v Premier Events Group Ltd, above n 13, at [48].17 Authority Determination, above n 1, at [1]−[6].18 FMV v TZB HC Auckland CIV-2016-404-3267, 19 March 2018 at [7].19 High Court Decision, above n 1, at [67].[31] Mr Sharp submitted we ought to set aside Brewer J's order, having regard tothe presumption of open justice, the fact that the Authority's suppression order wasattributable in part to the fact that at the time the parties had not attended mediation,and the fact that Ms FMV did not object to publication of her details.[32] There appears to be some confusion about whether or not the parties haveattended mediation. Mr Clarke advised us they had not. That being so, a principalreason for the Authority's order apparently remains. It considered that publicity wouldinhibit prospects for a successful mediation.[33] Regardless, we decline to interfere with the Judge's decision. We are notpersuaded that Brewer J erred. As he recognised, the open justice principle appliesand it is not displaced merely because a party, in this case TZB, may find publicityunwelcome or embarrassing.20 But it is appropriate to defer to the Authority incircumstances where we have agreed with the Judge that the High Court lackedjurisdiction. If Ms FMV wishes the issue of suppression to be reconsidered, it is openfor her to apply to the Authority to rescind its order.Result[34] The appeal is dismissed.[35] The High Court order prohibiting publication of the names of the parties exceptin accordance with the intituling of this judgment remains in effect.[36] Costs follow the event. Ms FMV must pay TZB's costs for a standard appealon a band A basis with usual disbursements.Solicitors:HDA Lawyers Limited, Auckland for AppellantBell Gully, Auckland for Respondent20 Erceg v Erceg [2016] NZSC 135, [2017] 1 NZLR 310 at [13].