FEDERAL COURT OF AUSTRALIA Director of the Fair Work Building Industry Inspectorate v O'Connor [2016] FCA 856 File number: SAD 253 of 2014 Judge: BESANKO J Date of judgment: 29 July 2016 Catchwords: PRACTICE AND PROCEDURE – whether applicant can read evidence taken in another proceeding – where other proceeding an application for contempt against a party in this proceeding – where common substratum of facts in both proceedings – where some parties not parties in other proceeding – where judge in other proceeding declared witness to be a hostile witness – where judge in other proceeding had significant reservations about reliability of witness and found his evidence inconsistent in some respects – Federal Court Rules 2011 (Cth), r 30.25 Legislation: Evidence Act 1995 (Cth) s 38 Fair Work Act 2009 (Cth) s 500 Federal Court Rules 2011 (Cth) r 30.25 Cases cited: Director of the Fair Work Building Industry Inspectorate v Cartledge [2014] FCA 1047 Director of the Fair Work Building Industry Inspectorate v Cartledge [2015] FCA 453 Date of hearing: 15 April 2016 Registry: South Australia Division: Fair Work Division National Practice Area: Employment and Industrial Relations Category: Catchwords Number of paragraphs: 21 Counsel for the Applicant: Mr I Neil SC with Mr D Chin Solicitor for the Applicant: Clayton Utz Counsel for the Respondents: Mr M Abbott QC with Mr M Ats Solicitor for the Respondents: Lieschke & Weatherill Lawyers ORDERS SAD 253 of 2014 BETWEEN: DIRECTOR OF THE FAIR WORK BUILDING INDUSTRY INSPECTORATE Applicant AND: JIM O'CONNOR First Respondent JACK MERKX Second Respondent CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION Third Respondent JUDGE: BESANKO J DATE OF ORDER: 29 July 2016 THE COURT ORDERS THAT: 1. The parties be heard as to the precise terms of the appropriate orders and directions in light of these reasons. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT BESANKO J: 1 This is an application by the applicant in this proceeding (SAD 253 of 2014) for the following orders: 4. Subject to Orders 12 and 13, the evidence from the hearing of the Applicant's Interlocutory Application dated 2 September 2014 in matter SAD 57 of 2014 (Contempt Hearing) be accepted as evidence in this proceeding. 5. Subject to any proper claims in respect of privilege against self-incrimination and self-exposure to penalty, the Respondents shall, four weeks prior to the trial, file and serve any affidavit(s) from witnesses, including themselves from whom they propose adducing evidence at trial. 12. The Second and Third Respondents shall be granted leave to cross-examine at trial any witness called by the Applicant to give evidence at the Contempt Hearing (subject to notification being provided pursuant to Order 7), but with such cross-examination being limited to any issue(s) which were not the subject of cross-examination by counsel for the First Respondent at the Contempt Hearing. (Emphasis added.) 13. The First Respondent is not otherwise at liberty to cross-examine any witness who was called by the Applicant to give evidence at the Contempt Hearing. 2 In paragraph 7 of the proposed orders, the applicant seeks an order that each party notify the other parties of any witnesses to attend at trial for cross-examination no later than 14 days prior to trial. 3 At the hearing of the application, counsel for the applicant told the Court that he did not press that part of Order 12 which I have emphasised and he also acknowledged that Order 13 would be of little practical effect if, as counsel for the respondents told the Court, all three respondents will be represented by the same solicitors and counsel. The burden of the applicant's application is that the evidence in the Contempt Hearing be accepted as evidence in this proceeding (see r 30.25 of the Federal Court Rules 2011 (Cth) which provides that a party may apply to the Court to read evidence taken in another proceeding). 4 The applicant to this proceeding is the Director of the Fair Work Building Industry Inspectorate, and the respondents are Mr Jim O'Connor, Mr Jack Merkx and the Construction, Forestry, Mining and Energy Union ("CFMEU"). The proceeding was commenced on 9 October 2014. The applicant seeks declarations of contraventions of a number of sections of the Fair Work Act 2009 (Cth) ("FW Act") and the imposition of pecuniary penalties. The contraventions are alleged to have taken place on 13 May 2014 at the site of the new Royal Adelaide Hospital project and to have involved a business called Bleasdale National Contractors. This proceeding has not progressed in the normal fashion because of events in another proceeding in the Court, being SAD 57 of 2014. 5 The applicant in SAD 57 of 2014 is the applicant in this proceeding. There were six respondents in the proceeding and they included Mr O'Connor (as second respondent) and the CFMEU, but not Mr Merkx. The proceeding was commenced on 24 March 2014 and involved a claim by the applicant that the respondents had contravened s 500 of the FW Act on 19 and 20 March 2014 at a construction project in Adelaide known as the "50 Flinders Street" project. On 25 March 2014, a judge of this Court made the following order: Until further order, each of the first respondent, the second respondent, the third respondent, the fourth respondent, the fifth respondent, and any other organiser of the sixth respondent employed in its Construction and General Division, South Australian Divisional Branch, be restrained from attending the Hansen Yuncken Pty Ltd (Hansen Yuncken) project at 50 Flinders Street, Adelaide, or the project for the construction of the new Royal Adelaide Hospital in which Hansen Yuncken is engaged as a head contractor, unless they are lawfully exercising or seeking to exercise rights in accordance with Part 3-4 of the Fair Work Act 2009 (Cth). (Emphasis added). 6 On 3 September 2014, the applicant issued an interlocutory application against Mr Jim O'Connor in which he sought the following orders: (1) a monetary penalty be imposed on Jim O'Connor for being in contempt of an order made by his Honour Justice Mansfield on 25 March 2014 by reason of his conduct on 13 May 2014 at the site of the project for the construction of the new Royal Adelaide Hospital at Port Road, Adelaide (the new RAH project) on which Hansen Yuncken Pty Ltd is engaged as a head contractor. (2) O'Connor pay the Director's costs of the interlocutory application on an indemnity basis. 7 Those orders were resisted by Mr O'Connor and went to hearing before Mansfield J. I will call this interlocutory application the Contempt Application and the hearing of the application as the Contempt Hearing. Meanwhile, the substantive application in SAD 57 of 2014 was disposed of by the making of final orders (Director of the Fair Work Building Industry Inspectorate v Cartledge [2014] FCA 1047). 8 Mansfield J delivered his reasons for judgment on the Contempt Application on 13 May 2015 (Director of the Fair Work Building Industry Inspectorate v Cartledge [2015] FCA 453). A number of matters about his Honour's decision should be noted. 9 First, his Honour explained the reasons he rejected the application that this proceeding, a civil penalty proceeding (SAD 253 of 2014), be heard at the same time as the Contempt Application. His Honour said at [23] and [24]): There is an obvious attraction to the Director's application. It would be efficient, because there is clearly a largely common substratum of facts. It would avoid the risk of there being inconsistent findings about what happened on 13 May 2014, if the two proceedings were heard separately. However, I considered that the contempt application should be heard and determined first. It was appropriate to allow O'Connor to decide, on the contempt application, whether he gave evidence at all and/or called Merkx or others in his defence. The same considerations might not apply to his decision to give (or call other) evidence in the civil penalty proceeding. In addition, there is the risk that either the CFMEU or Merkx might also call or give evidence in the civil penalty proceeding, and it would be very difficult to untangle or disregard that evidence from the admissible evidence against O'Connor in the contempt application. Indeed, either the CFMEU or Merkx might have called O'Connor to give evidence in the civil penalty proceeding, even though O'Connor chose not to give evidence in the contempt application, or they may have cross-examined witnesses in a way that O'Connor in the conduct of the contempt application may not have chosen to do so. At a more practical level, the Court was informed that counsel appearing for O'Connor on the date fixed for the hearing of the contempt application was not retained to appear for, or ready to appear on behalf of, the CFMEU or Merkx on the hearing of the civil penalty proceeding. 10 Importantly, his Honour said the following (at [27]): I indicated in the course of submissions that, subject to hearing from the parties at the time when the civil penalty proceeding comes on for hearing, the Court would anticipate that the evidence led on the contempt application should be tendered and received as evidence in the civil penalty proceeding, especially having regard to ss 37M and 37N of the Federal Court of Australia Act 1976 (Cth). Counsel for O'Connor agreed that O'Connor would find it difficult to resist that. Part of the efficiency urged by the Director would be achieved in that way. 11 Secondly, his Honour identified the witnesses called by the applicant and the evidence each of them gave. A critical witness was Mr N Bleasdale. The judge said that Mr Bleasdale's evidence was not consistent in all respects and, in fact, the judge acceded to an application by the applicant that he be declared a hostile witness (see s 38 of the Evidence Act 1995 (Cth)) (at [65]). He had significant reservations about Mr Bleasdale's reliability as a witness (at [136]). 12 Thirdly, his Honour recorded the fact that Mr O'Connor did not give evidence and nor did he call any witnesses (at [92]). 13 Fourthly, his Honour did accept some aspects of Mr Bleasdale's evidence which proved crucial. His Honour said (at [146]): The one qualification is the finding about the words used by O'Connor. The submission on his behalf is that N Bleasdale's evidence was so unsatisfactory that no such finding could or should be made. I do not accept that. It was a consistent proposition put forward by N Bleasdale in his evidence, despite his changes of evidence on other matters and despite the particular criticisms of his evidence which were made. I had the opportunity of seeing his evidence over three different days. I considered that, in that respect, what he attributed to O'Connor is accurate. In reaching that view, I have of course taken into account the apparent discrepancies in his evidence about the estimate of time the second conversation lasted and the time that it occurred. In the overall picture of the evidence, those matters do not really inform my decision about what happened because, in my view, they simply represent imprecise but understandably slightly different estimates or impressions. 14 Finally, his Honour found that Mr O'Connor had acted in contempt of the order he made on 25 March 2014. 15 The counsel and the solicitors who appeared for Mr O'Connor in SAD 57 of 2014 also appear for the three respondents in this proceeding. Counsel for the respondents told me that I could proceed on the basis that one counsel will act for all three respondents. As appears from the passage set out above, counsel for Mr O'Connor in SAD 57 of 2014 told Mansfield J that he would find it difficult to resist the proposition that the evidence led on the Contempt Application should be tendered and received as evidence in this proceeding. 16 As I have said, the applicant no longer presses for that part of paragraph 12 which would prevent the second and third respondents from cross-examining any of the applicant's witnesses as to any issue which was the subject of cross-examination by counsel for Mr O'Connor at the Contempt Hearing. That removes one of the grounds upon which the respondents oppose the orders proposed by the applicant. I would not make the order sought in paragraph 13 of the proposed orders. The respondents are entitled to be represented by the one counsel and it would be almost impossible in view of the common issues to determine when counsel for the respondents was cross-examining on behalf of the first respondent and not on behalf of the second and third respondents. 17 That leaves what I think is the principal objection of the respondents to the orders proposed by the applicant. They submit that Mansfield J's observations in SAD 57 of 2014 as to the receipt of the evidence in the Contempt Application in this proceeding have been overtaken by what they described as the "extraordinary developments" concerning Mr Bleasdale's evidence in the Contempt Application. They refer to Mansfield J's observations as to the unsatisfactory nature of aspects of Mr Bleasdale's evidence and the fact that his Honour declared him a hostile witness on the application of the applicant. I have already referred to his Honour's observations. I refer to one further passage from his Honour's reasons (at [136]): That lengthy description of the evidence of N Bleasdale in part explains why I have significant reservations about his reliability as a witness. It is clear that in important respects his evidence in chief and his cross-examination on the first hearing day differed from his evidence during cross-examination on the second day and on the third day. On the latter two periods, his evidence was directed to exculpating O'Connor from, or minimalizing his role and responsibility for the conduct during the second conversation which is said by the Director to support the present contempt application against him. It does not readily lie alongside his evidence in chief. 18 I am not prepared to accede to the applicant's application as far as Mr Bleasdale's evidence is concerned. I think that the Court should know and the respondents should know before trial exactly what evidence he will give by way of his evidence-in-chief. It is clear that he is a key witness whose credibility and reliability are under attack. The matter is likely to become very confused unless Mr Bleasdale's evidence-in-chief is quite clear. There should be an order that his proposed evidence-in-chief be reduced to writing before the trial. 19 I can see no reason why the order sought by the applicant in paragraph 4 should not be made in relation to the other witnesses called by the applicant at the Contempt Hearing. 20 I refer to two matters which, it should be noted, do not bear on this application. First, the applicant has pleaded in his Reply an issue estoppel against Mr O'Connor based on the findings made in SAD 57 of 2014. Secondly, Mr O'Connor claims that the claim against him for declaratory relief is an abuse of process because the relevant matters have already been determined in SAD 57 of 2014. 21 I will hear the parties as to the precise terms of the appropriate orders and directions in light of these reasons. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Besanko. Associate: Dated: 29 July 2016