FEDERAL COURT OF AUSTRALIA Johnson v Monti-Haitsma Enterprises Pty Limited (in external administration) [2014] FCA 906 Citation: Johnson v Monti-Haitsma Enterprises Pty Limited (in external administration) [2014] FCA 906 Parties: DEBRA JOHNSON v MONTI-HAITSMA ENTERPRISES PTY LIMITED (IN EXTERNAL ADMINISTRATION) File number: NSD 713 of 2014 Judge: EDMONDS J Date of judgment: 26 August 2014 Catchwords: PRACTICE AND PROCEDURE – application for extension of time to file notice of appeal from judgment of Federal Circuit Court of Australia – principles to be applied – where merits of appeal the important consideration – no reasonable prospects of success – application dismissed Legislation: Fair Work Act 2009 (Cth) ss 16, 20, 294(1), 294(2) Federal Court Rules 2011 r 36.05 Cases cited: Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 cited Kerr v Jaroma Pty Ltd t/a Treasury Motor Lodge (1996) 70 IR 469 cited Parker v The Queen [2002] FCAFC 133 cited Date of hearing: 13 August 2014 Place: Sydney Division: GENERAL DIVISION Category: CATCHWORDS Number of paragraphs: 22 Counsel for the Applicant: Mr R De Meyrick Solicitor for the Applicant: CBD Law Counsel for the Respondent: Mr B Cross Solicitor for the Respondent: Australian Business Lawyers & Advisors IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 713 of 2014 BETWEEN: DEBRA JOHNSON Applicant AND: MONTI-HAITSMA ENTERPRISES PTY LIMITED (IN EXTERNAL ADMINISTRATION) Respondent JUDGE: EDMONDS J DATE OF ORDER: 26 AUGUST 2014 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The Application be dismissed. 2. The applicant pay the respondent's costs of the Application. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 713 of 2014 BETWEEN: DEBRA JOHNSON Applicant AND: MONTI-HAITSMA ENTERPRISES PTY LIMITED (IN EXTERNAL ADMINISTRATION) Respondent JUDGE: EDMONDS J DATE: 26 AUGUST 2014 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This is an application for an extension of time under r 36.05 of the Federal Court Rules 2011 ("FCR") to file a notice of appeal from a judgment of the Federal Circuit Court of Australia ("FCCA") (Johnson v Monti-Haitsma Enterprises Pty Ltd [2014] FCCA 259) ("Application"). Background 2 The background to this Application is summarised below. 3 The FCCA (Judge Driver) delivered judgment on 20 June 2014. Consistent with its reasons for judgment, the FCCA ordered that the applicant's application, as amended on 1 August 2013, be dismissed. 4 The last day for the applicant to file a notice of appeal in this Court was 11 July 2014 (r 36.03 of the FCR). 5 The Application was filed on 17 July 2014 and was not served on the respondent, in accordance with r 36.06 of the FCR, until 1 August 2014. No explanation for this latter delay was given. 6 The Application was supported by an affidavit of John Hamish Giles Finney ("Mr Finney") sworn 16 July 2014 and filed 17 July 2014 (Ex 1); a draft notice of appeal filed 17 July 2014; and a further affidavit of Mr Finney sworn 8 August 2014 and filed 12 August 2014 (Ex 2), to which was attached a copy of the reasons for judgment below. 7 The Application was opposed by the respondent. In support of its opposition the respondent relied on an affidavit of Alana Louise Paterson sworn and filed on 12 August 2014 (Ex A). 8 In Ex 1, Mr Finney deposed to following narration of circumstances and events as providing the explanation for the failure to file a notice of appeal in accordance with the requirements of r 36.03 of the FCR: 1. I am the Solicitor for the Applicant. 2. I refer to the judgment of his Honour Driver J of the Federal Circuit Court of Australia handed down on 20 June 2014. Judgment was received by my city agents, City Mentions Practice that day. 3. I received a short report from my agent on 20 June 2014 with the judgment and a letter on 25 June 2014. 4. Following the judgment, my employed Solicitor, Marcus Frangos had a discussion with the Applicant. Following those instructions, Counsel was requested to draft grounds of appeal. 5. Whilst the originally correct last date for appeal of 11 July 2014 was noted by Mr Frangos, due to an administrative oversight the date in my diary was entered as 18 July 2014. 6. Mr Frangos then went on an overseas holiday on 4 July 2014 and has not returned. In the meantime I acted under the misapprehension that the date before which the appeal needed to be filed was 18 July 2014. 7. Counsel was absent from chambers from 27 June 2014, returning on 7 July 2014. Telephone calls were made and emails sent to Counsel in relation to the notice of appeal which was drafted and forwarded on 15 July 2014. 8. It did not come to my attention that the time for appeal was in fact the week earlier until the grounds of appeal drafted by Counsel were reformatted for filing in the Registry. 9 Ex 2 was nothing more than Mr Finney's summary of the applicant's employment history with the respondent; the claims she made against the respondent; the issues before the FCCA; questions/issues to be raised on the appeal if the Application is granted; certain findings of the primary judge and details of certain evidence before the FCCA. It does not contribute to, or assist the Court in reaching, a just determination of whether the Application should be granted. 10 By Ex A, Ms Paterson deposed that prior to the applicant filing her application in the FCCA, the respondent was placed into external administration as its business had been sold and it had ceased trading. Ms Paterson deposed that her instructions had been received from the administrator and that following the passing of time for filing a notice of appeal, viz., 11 July 2014, the administrator was proceeding to wind the respondent up and distribute its assets to its shareholders. She then deposed at some length to the inconvenience and difficulty that had been experienced by the respondent and its legal representatives as a result of the failure of the applicant to file her notice of appeal on a timely basis and to the delay (up to two weeks) in effecting service of the Application and supporting documents on the respondent. This inconvenience and difficulty seemed to go to, and make good, oral submissions made on behalf of the respondent that some prejudice had been caused to it by this failure and delay, although any such prejudice was clearly ephemeral and not of a permanent kind. There was a suggestion that the winding up of the respondent would be delayed if the Application were granted, but any such prejudice would be no more than the prejudice suffered had the notice of appeal been filed on a timely basis. Consideration 11 The discretion given to the Court to extend time for filing a notice of appeal is a wide one, but the exercise of the discretion is conditioned by the purpose for which the discretion is given namely, to do justice between the parties. There is no longer a requirement, as there was under the former Rules (O 52 r 15(2)), that an applicant show "special reasons" – that "takes the case out of the ordinary" (Jess v Scott (1986) 12 FCR 187 at 195) – but the considerations guiding the exercise of the Court's discretion set out in Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 at 348–349, and adopted by the Full Court in Parker v The Queen [2002] FCAFC 133 at [6] are still relevant: (1) Applications for an extension of time are not to be granted unless it is proper to do so; the legislated time limits are not to be ignored. (2) The applicant must show an "acceptable explanation for the delay"; it must be "fair and equitable in the circumstances" to extend time. (3) Other action taken by the applicant to challenge the decision is relevant to the consideration of the question whether an acceptable explanation for the delay has been furnished. (4) Any prejudice to the respondent in defending the proceeding that is caused by the delay is a material factor militating against the grant of an extension but the mere absence of prejudice will not justify the grant of an extension. (5) The merits of the appeal are to be taken into account. The considerations referred to in (2), (4) and (5) are relevant to this Application. 12 Mr Finney's explanation for the delay is not "acceptable". To say that the entry in his diary of 18 July 2014 was due to "administrative oversight" says nothing about the circumstances that led to that entry being made rather than the correct date of 11 July 2014; it says nothing as to who made the entry, and as to what documents were relied on for making the entry. Apparently, Mr Frangos got it right, but went overseas on 4 July 2014 and had not returned at the time of filing the Application. There was no evidence as to what transpired between Mr Frangos and Mr Finney prior to the former's departure overseas as to the filing of a notice of appeal. 13 On the other hand, the delay in filing the Application was not long (six days) although the delay in serving it (two weeks) is totally inexplicable. 14 Nevertheless, any inconvenience or difficulty suffered by the respondent as a result of these delays was only ephemeral; there is no permanent prejudice over and above what would be suffered had the notice of appeal been timely filed. 15 The important consideration in the present Application is the merits of the applicant's proposed appeal. In my view, it has no merit and if the Application were granted, the appeal would inevitably fail. 16 The draft notice of appeal filed in support of the Application contained ten grounds. Ground One 17 This ground asserts that the primary judge erred in finding that the Motels Accommodation and Resorts (State) Award ("the MAPSA") did not apply to the terms and conditions of the applicant's employment. His Honour dealt with this matter at [27]–[33] of his reasons ("R") and the relevant finding is made at R [32]. His Honour held, correctly in my view, that his finding was consistent with the decision of the Industrial Relations Court of Australia in Kerr v Jaroma Pty Ltd t/a Treasury Motor Lodge (1996) 70 IR 469 esp. at 471–472. I agree. There is no error in his Honour's finding, or his reasons for so finding, on this issue. Ground Two 18 It is asserted that his Honour erred in finding that the Hospitality Industry (General) Award 2010 ("The Modern Award") did not apply to the terms and conditions of the applicant's employment. His Honour dealt with this matter at R [34]–[37] and the relevant finding is made at R [35] and [37]. Again I am unable to discern any error in his Honour's reasons and none is identified in the draft notice of appeal. Ground Three 19 It is asserted that his Honour should have held that the applicant was underpaid in respect of the minimum rates of pay mandated from time to time by the National Minimum Wage. His Honour dealt with this matter at R [38]–[40]. His Honour accepted the respondent's submission, correctly in my view, that the minimum wage does not involve any calculation of overtime (at R [39]). He did this on the basis of the relevant provisions of the Fair Work Act 2009 (Cth), in particular sub-ss 294(1) and (2); the definition of "base rate of pay" in s 16, a term used in s 294(2); and the definition of "ordinary hours of work" in s 20, a term used in the definition of "base rate of pay". Again I can see no error in his Honour's process of reasoning and none is identified in the draft notice of appeal. Grounds Four – Six 20 These grounds assail his Honour's rejection of the applicant's evidence as to her hours of work; his Honour's failure to make any findings as to what were the applicant's hours of work; and his Honour's failure to make any findings concerning whether time spent merely being available to work if required constituted work attracting remuneration. In my view, these grounds have no possibility of success having regard to his Honour's findings as to the applicant's evidence at R [17] and [18]. Grounds Seven – Ten 21 These grounds seek to assail his Honour's rejection of the applicant's submission that the employer had breached its lawful obligation to maintain records of the applicant's hours of work; erred in visiting upon the applicant the blame for the failure of either party to produce written records of the applicant's hours of work; erred in not holding that the employer was in breach of its legal obligations to maintain and produce records of the applicant's hours of work and in such circumstances the Court should have also held that the failure to tender such records was no impediment to the applicant maintaining her claim based on such evidence that was reasonably available to present; and erred by in effect reversing the onus to maintain and produce written records of employee hours of work. These grounds are effectively directed to his Honour's reasons at R [43] and, to a lesser extent, R [44]. At R [43] his Honour said: The fact that Ms Johnson was not entitled to overtime payments is not a complete answer to her claim. There remains the question of what were her ordinary hours of work. The controversy between the parties at the trial of this matter centred upon the hours actually worked by Ms Johnson. It was conceded by counsel for Ms Johnson that if she could not establish that she worked more than 38 hours a week, she could not succeed in her claim. Although Ms Johnson and her legal representatives have striven mightily to establish that the working hours of Ms Johnson exceeded that figure, they have not been able to do so. The reality is that Ms Johnson fixed her own hours of work according to what the management of the Ashwood required from time to time and what suited her convenience. There are no reliable records of her hours of employment. Ms Johnson asserts that this is a breach of the employer's duty to maintain such records. However, this overlooks the reality of the basis upon which the Ashwood operated. That reality was that the representative of the managing company lived at a considerable distance and had no involvement of the day to day running of the motel. In many respects, Ms Johnson acted as the representative and agent of the owner. It was she who maintained the business records for the day to day operations of the Ashwood and recorded the hours of employment of the staff that she engaged. It follows, in my view, that it was her responsibility to record the hours of her own employment. No such records have been produced. (Emphasis added.) At R [44] his Honour said: The national minimum wage is based upon a 38 hour week in the absence of any agreement as to the hours of work between an employer and employee. The employment agreement between Monti-Haitsma and Ms Johnson did not specify her hours of employment. It is not disputed that Ms Johnson has received upon her termination her entitlements under the national minimum wage on the basis of a 38 hour week. 22 In my view, the applicant has no reasonable prospects of succeeding with an appeal on these grounds if the Application is granted. No other grounds were put forward in oral submissions on the hearing of the Application and, in those circumstances, the Application must be dismissed. I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds. Associate: Dated: 26 August 2014