Robert Bruce Henman v Westpac Banking Corporation [1995] IRCA 101

CATCHWORDS INJUNCTION - application for interlocutory injunction to restrain termination - power to grant - refusal on discretionary grounds TERMINATION OF EMPLOYMENT - interlocutory injunction to restrain termination Industrial Relations Act 1988, ss 170EH, 362, 419 and 431 Dunham v Randwick Imaging Pty Ltd (1994) 1 IRCR 54 Tognolini v Burnett Petroleum Distributors Pty Ltd (1994) 1 IRCR 25 Automotive Food Metals and Engineering Union v Northern Iron and Brass Factory (1994) 126 ALR 106 Association of Professional Engineers Scientists and Managers Australia v Skilled Engineering Pty Ltd (1994) 1 IRCR 106 Grout v Gunnedah Shire Council (1994) 125 ALR 355 Canceri v Taylor (1994) 123 ALR 667 ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 110 ALR 47 Saraswati v The Queen (1991) 172 CLR 1 Australian Building Construction Employees' and Builders Labourers' Federation v Master Builders' Association of New South Wales (1986) 18 FCR 18 No. NI 1406 of 1995 ROBERT BRUCE HENMAN v WESTPAC BANKING CORPORATION MOORE J SYDNEY 17 MARCH 1995

IN THE INDUSTRIAL RELATIONS ) ) COURT OF AUSTRALIA ) No. NI 1406 of 1995 ) NEW SOUTH WALES DISTRICT REGISTRY) BETWEEN: ROBERT BRUCE HENMAN Applicant AND: WESTPAC BANKING CORPORATION Respondent JUDGE: Moore J PLACE: Sydney DATE: 17 March 1995 REASONS FOR JUDGMENT On Friday, 10 March 1995 I refused to grant an interlocutory injunction in this matter and I said I would publish my reasons for doing so as soon as I could. These are my reasons. On 28 February 1995 an application was filed in apparent conformity with Form 132 of the Industrial Relations Court Rules as an application under s170EA of the Industrial Relations Act by Mr Henman ("the applicant") though it was not apparent from the application that there had been a termination or that written notice of termination had been given. The remedy sought was identified as: "Declaration that the termination of my employment on 10 March 1995 contravenes/will contravene Division 3 of Part VIA of the Industrial Relations Act. Order that the respondent refrain from terminating the applicant's employment." When the application was filed, the applicant appears to have believed he was to have his employment with the Westpac Banking Corporation ("Westpac") terminated on 10 March 1995. As events unfolded it appears this belief has a basis in fact though Westpac has submitted there existed an agreement between it and the applicant that his employment would terminate on that day. Also filed on 28 February 1995 was a notice of motion seeking an order that Westpac refrain from terminating the applicant's employment. That notice of motion was made returnable before me on 1 March 1995. At the hearing on that day the parties consented to mediation which was then scheduled for 3 March 1995. Allowing for the contingency that mediation was unsuccessful, which proved to be the case, I listed the matter for directions on 7 March 1995 on the basis that I would hear the application for the interlocutory injunction on 8 March 1995. At the hearing on 1 March 1995, counsel for Westpac indicated that it would contend that the Court has no jurisdiction to entertain the substantive application under s170EA but it would not raise that issue in the context of the interlocutory application if it could reserve its right to argue it in due course. This was agreed to by counsel for the applicant. I gave directions that written submissions concerning the interlocutory application be filed and served before the hearing scheduled for 8 March 1995 if the hearing became necessary which it did. At the hearing on 8 March 1995, counsel for the applicant submitted that I had jurisdiction to grant the interlocutory injunction and should do so. The written submissions of the applicant filed the previous day, and oral submissions made on 8 March 1995 appeared to proceed on the basis that not only was there before the Court a statutory claim made under s170EA but a common law claim based on alleged breaches of contract maintained in the associated jurisdiction of the Court: see s430. However the pleadings did not, in terms, raise any common law claim. In due course an application was made to amend the application to raise a common law claim. The application was granted in part. The further claim thus raised was an alleged breach by Westpac of a contractual term requiring it to seek to find alternative employment for the applicant within Westpac in the circumstances in which he then was. A draft statement of claim prepared at my direction and filed the following day raised further claims of alleged breach of contract including a breach by Westpac of an implied contractual obligation to comply with its disciplinary procedures. The pleadings were amended to raise this allegation. Against this background I had to consider whether jurisdiction existed to grant an interlocutory injunction and whether I should. The applicant is 40 years old and has worked with Westpac for 23 years in a range of positions. From July 1990 until December 1994 he held the position of Manager, trading and portfolio management, short term interest rate risk in the Australian financial markets group. From December 1994 he occupied the position of Manager of short term interest rate risk in the Australian financial markets group. The following narrative is taken from affidavit evidence of the applicant filed in these proceedings that was not put in issue by Westpac for the purposes of the interlocutory application. I am not presently making findings of fact based on all relevant evidence or at a point when the affidavit evidence has been tested in exhaustive cross examination. In early December 1994, the applicant was advised that he would be transferred to a position in the futures trade head desk and was informed he had no choice about the move. The transfer appears to have followed an adverse appraisal of his performance during the preceding 12 months. The applicant was not given an opportunity to discuss the transfer prior to being told it would occur. On 5 January 1995 the applicant spoke to a more senior employee about losses the applicant had recently incurred in trading undertaken in the position he then occupied. A meeting with more senior employees occurred later that day, a minute of which is signed by the applicant. The minute refers to loss of confidence by the applicant in his ability to trade. It records a discussion to the effect that the applicant wanted other employment within the bank and asked for two months to enable other employment to be found. On Friday, 6 January 1995 the applicant was informed that his request for two months to find other employment within the bank was agreed to, though his salary would be reduced from $110,000 to $65,000 per annum. It was indicated that if other employment had not been secured by him after two months, Westpac would expect his resignation or, if not proffered, it would terminate his employment. He was given the weekend to think about it. A minute of a meeting on Monday, 9 January 1995 records further discussion about the matter and the same minute records that at a further meeting on 10 January 1995, 10 March 1995 was set as the date by which the applicant would have to secure other employment within the bank. It also records that it was expected that if other employment was not found the applicant would then resign or his employment would be terminated. While the minutes are signed by the applicant, he denies he agreed to resign at any time on 6, 9 or 10 January 1995. He says in his affidavit that he has not, since early January 1995, been offered other employment within the bank by its Human Resources Division though the applicant describes one incident where a suggestion is made of possible employment in another area of the bank's operations, but nothing materialised. In late February 1995 the applicant's solicitors sought undertakings from Westpac not to terminate his employment on 10 March 1995 but no undertaking to that effect was forthcoming. The applicant tendered notes made by a Westpac employee who appears to have discussed the possibility of employment of the applicant elsewhere in the bank with other employees who are described in a variety of ways as human resources managers employed in a range of organisational areas of the bank. Also tendered was the bank disciplinary code and reference was made to a section dealing with summary dismissal. The respondent submitted the Court lacks jurisdiction to make the interlocutory order which is a matter I now address. In support of this submission reference was made to Dunham v Randwick Imaging Pty Ltd (1994) 1 IRCR 54 per Wilcox CJ, Tognolini v Burnett Petroleum Distributors Pty Ltd (1994) 1 IRCR 25 per Spender J and Automotive Food Metals and Engineering Union v Northern Iron and Brass Factory (1994) 126 ALR 106 per Spender J. However in Association of Professional Engineers Scientists and Managers Australia v Skilled Engineering Pty Ltd (1994) 1 IRCR 106, Gray J said at 117: "It should also be noted that the construction which I have adopted assists in giving meaning and effect to s 170EE(4). In cases in which the 'termination' be the employer has not succeeded in bringing to an end the contract of employment, it would in my view be open to the Court to grant appropriate interim and interlocutory relief. In expressing this view, I am respectfully differing from the view expressed by the learned Chief Justice in Dunham v Randwick Imaging Pty Ltd (1994) 1 IRCR 54. Division 3 of Pt VIA of the Act is legislation giving rights, not taking them away. The fact that it does not extend to contraventions of Subdiv B the power to grant a statutory injunction pursuant to s 431 of the IR Act (as to which see s 170EH) is not an indication that it has taken away whatever rights might exist to injunctions or other orders that could have been granted by a court of equity, independently of the statutory power. Section 419 of the IR Act gives to this Court the fullest power to grant orders of all kinds, including interlocutory orders. That power is expressly preserved by s 170EE(4) in the case of applications under s 170EA. It must be borne in mind, however, that the granting of such orders is discretionary. The availability of the remedies of reinstatement and compensation will no doubt be a factor in the exercise of the Court's discretion. So also will be whatever ability the Court may have to provide an early hearing of a claim lodged under s 170EA." As to Div3 of PtVIA being beneficial legislation to be construed liberally: see Grout v Gunnedah Shire Council (1994) 125 ALR 355 at 372. The power to grant an interlocutory injunction restraining termination might be thought to arise in at least three ways. Firstly, as the exercise of the express statutory power conferred by s431 to grant an injunction to restrain an employer contravening the Act. Secondly, as the exercise of a power impliedly arising from the constitution of the Court as a Court of equity under s361(2): see Canceri v Taylor (1994) 123 ALR 667, together with s419 to restrain a breach of a statutory duty imposed on an employer by Div3; as to the difference between the statutory and equitable injunction: see ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 110 ALR 47 at 63-64 per Gummow J. Thirdly, as the exercise of a power arising under s419 and s361(2), to restrain a breach of contract in a cause of action arising in the Court's associated jurisdiction brought in conjunction with the application under s170EA. As to the first, for the reasons given by Wilcox CJ and Spender J in the cases to which I earlier referred, it is, in my opinion, the plain intention of s170EH to deny the Court power that might have otherwise arisen under s431 to restrain an employer from terminating employment because the termination was, or would be, in contravention of the Act. As to the second, the grant of the special power in s431, conditioned by the provisions of s170EH, must limit the scope of the general powers arising under ss361(2) and 419: see Saraswati v The Queen (1991) 172 CLR 1, even if s361(2), by investing the Court generally with power to issue injunctive relief that may be issued by courts of equity, together with s419 can be taken to confer a power to restrain contravention of the Act: see Equity Doctrines and Remedies, Meagher, Gummow and Lehane, 3rd Edition, par2133 et seq. As to the third, my tentative view is that for the reasons advanced by Gray J in APESMA, supra, s170EH should not be construed as depriving the Court of such powers as it has to restrain a breach of contract in a cause of action arising in its associated jurisdiction. However it may be accepted this construction would permit the grant of interlocutory injunctive relief when the Court has derived its jurisdiction to do so from the institution of proceedings based on a statutory cause of action in which the Court is precluded by s170EH from issuing injunctive relief with at least the same practical effect. While this might be thought to enable the Court to do indirectly what it is precluded by the Act from doing directly: see Australian Building Construction Employees' and Builders Labourers' Federation v Master Builders' Association of New South Wales (1986) 18 FCR 18 at 27, the interests the injunction is protecting are not necessarily of the same character. However, given the view I formed that no injunction should issue on discretionary grounds, it was open to me to assume I had jurisdiction to grant the relief sought. I made that assumption. The reason for refusing to grant the injunction was the existence of the statutory remedy of reinstatement. If, as appeared likely to be the case, the applicant's employment was terminated on 10 March 1995, and the applicant succeeds in his application under s170EA and secures an order for reinstatement, it would place him in essentially the same position as he is presently in. His counsel did not point to any feature of his present employment which established that this would not be so. I accept that it is likely that the applicant will have endured the anxiety associated with prospective termination and its demoralising effect if it has occurred and his position will remain uncertain until his application under s170EA is heard and determined. However these matters do not, of themselves, provide, in the circumstances, a basis for granting the relief sought in this matter.