Morris Valentine Fawcett v Lime Industries Pty Ltd [1995] IRCA 121

C A T C H W O R D S INDUSTRIAL LAW - Termination of employment - complaint of unlawful termination practice and procedure - delay in filing affidavits - power of the court upon default - content of affidavits - whether affidavits should be removed from Court file - costs. INDUSTRIAL RELATIONS ACT 1988, S 170EA. INDUSTRIAL RELATIONS COURT RULES, Order 10 rule 7, Order 14 rule 8 Canceri v P J Taylor (1994) 55 IR 31 Lenjimar Pty Ltd v AGC (Advances) Limited (1990) 98 ALR 200 Charles v Shepherd (1982) 2 QB 622 Termijtelen v Arkel and Anor (1974) 1 NSWLR 525 Fuji Restaurants Pty Ltd v Port of Melbourne Authority, Federal Court of A, Heerey J, 13/6/91, unreported. Rossage v Rossage (1960) 1 WLR 249 MORRIS VALENTINE FAWCETT v LIME INDUSTRIES PTY LTD - WI 289/94 Judicial Registrar: BOON JR Place: Perth Date: 9 February 1995 IN THE INDUSTRIAL RELATIONS) COURT OF AUSTRALIA ) WESTERN AUSTRALIA ) DISTRICT REGISTRY ) No. WI 289 of 1994 B E T W E E N MORRIS VALENTINE FAWCETT - Applicant -v- LIME INDUSTRIES PTY LTD - Respondent COURT: BOON JR PLACE: PERTH DATE: 9 February 1995 REASONS FOR JUDGMENT Delivered Ex Tempore The applicant in this matter has applied by Notice of Motion under Order 19, rule 2 of the Industrial Relations Court Rules for orders that: (1) judgment be entered for the applicant (2) the respondent pay the applicant's costs to date. The applicant's solicitors have filed an outline of submissions on their notice of motion. As to the first part of the application, that is that judgment be entered for the applicant, the outline of submissions reads as follows: -2- "(1) The trial in this action is listed for 20 February 1995. (2) On 18 November 1994 at the directions hearing, the respondent's affidavits were ordered to be filed by 12 January 1995. The applicant's affidavits were filed and served on 15 December 1994. The respondent's affidavits were not received by the applicant's solicitors until after 5 pm on Friday, 27 January 1995. (3) The respondent's affidavits should be removed from the court file because they contain scandalous and oppressive material; Order 14, rule 8. (4) The court has a discretionary power to enter interlocutory or final judgment, Charles v Shepherd [1892] 2 QB 622 at 644, affirmed by the New South Wales Court of Appeal in Termijtelen v Arkel and Another (1974) 1 NSWLR 525. Removal of the respondent's affidavits leaves the respondent without any basis upon which to resist the application. (5) The interests of justice demand that the applicant knows in good time the basis of the respondent's resistance to the application otherwise there is a real risk of the trial on 20 February 1995 being a trial by ambush. -3- That is one of the main purposes of the order, for the timely filing of affidavits. (6) There is a real risk of prejudice and injustice to the applicant as a result of the late filing of the respondent's affidavits and the scandalous and oppressive nature of the contents of the respondent's affidavits. (7) Judgment, therefore, should be entered for the applicant with costs. Counsel for the applicant argued that as the respondent's affidavits were filed 15 days after the time stipulated at the directions hearing, this matter concerns procedural fairness. It is argued that injustice has been occasioned to the applicant because of: (1) the late filing of the affidavits by the respondent and (2) the fact that the respondent's affidavits contain material which is scandalous and oppressive, hearsay and irrelevant and are, therefore, not proper affidavits within the meaning of the Rules. It is argued on behalf of the applicant that the affidavits filed by the respondent should be removed from the court file pursuant to Order 14 rule 8 of the Industrial Relations Court Rules because they contain scandalous and oppressive material. If such an order is made, there would be no material left on the court file to show what the respondent's case is. -4- It was argued that because a trial in this matter has been set down for 20 February 1995 it is not possible for the respondent to file fresh affidavits with sufficient time for the applicant and his solicitors to prepare for trial. Counsel for the applicant argued that there is a very real risk of prejudice to the applicant in that he does not know the exact issues to be dealt with at the trial and that the hearing would in effect be one of "trial by ambush". Counsel for the applicant submitted that because of prejudice suffered by the applicant as a result of this, it was in the interests of justice that this court should enter judgment for the applicant. He argued that Moore J, in the decision of Canceri v P.J. Taylor, (1994) 55 IR 31, found that there was a power to award costs and it was in the interests of justice that the respondent should pay the applicant's costs in this case. Counsel for the respondent, who indicated that he had only been instructed in this matter in the last 24 hours, submitted that the relief sought by the applicant is manifestly harsh and should only be granted in the most extreme cases. As to the late filing of the respondent's affidavit, counsel for the respondent pointed out that although the affidavits were filed 15 days after the date on which they had been ordered to be filed at the directions hearing, the solicitors for the applicant had agreed to an extension of time to 20 January 1995. The affidavits were filed on 27 January 1995, one week later than agreed. Counsel for the respondent pointed to the affidavit of Philip George Brunner, sworn 6 January 1995 and filed herein. Mr Brunner had been acting as the representative for the respondent. This affidavit shows that the reasons for the delay in filing the respondent's affidavits included -5- (a) the respondent's premises closed down for a week over Christmas, (b) Mr Brunner himself was engaged on a number of other matters involving court appearances and industrial disputes, (c) there were substantial administrative difficulties at Mr Brunner's place of work on at least two occasions. The respondent's outline of submissions states that there was no suggestion in this matter that the respondent has deliberately failed to comply, nor is there any suggestion that the respondent is unwilling to cooperate in the litigation. The respondent's outline of submissions states that the court's powers to enter judgment under Order 10, rule 7 may be exercised where a party has demonstrated an unwillingness to cooperate in the litigation, for example by non-compliance with directions of the court, Lenjimar Pty Ltd v AGC (Advances) Limited (1990) 98 ALR 200. The outline of submissions states that in considering the exercise of this power, the court will consider any history of non-compliance with directions and whether there has been a deliberate failure to comply; Fuji Restaurants Pty Ltd v Port of Melbourne Authority, (Fed Ct of A, Heerey J 13 June 1991 unreported) Bourke v Young, (Fed Ct of A, Hill J 10 February 1993 unreported). It was argued by a counsel for the respondent that the delay in filing the affidavits has not been occasioned by wilful neglect or default on behalf of the respondent. As the affidavits were filed only one week beyond the time agreed to by the applicant for filing, the applicant will not suffer any material prejudice and has ample time in which to prepare its case. -6- It is submitted that there is nothing in the affidavits supporting the notice of motion establishing any real and material risk of prejudice and injustice to the applicant. As to the question of scandalous or oppressive matter in the respondent's affidavit, it was submitted for the respondent that this is a matter of discretion for the court. Counsel for the respondent acknowledged that some of the material in the respondent's affidavit is clearly problematic. The decision in Rossage v Rossage (1960) 1 WLR 249 at 252 was referred to. There is a distinction between material that is scandalous but relevant and material that is scandalous but irrelevant. It was submitted that the court should not strike out matters simply on the grounds that they are scandalous if the material is relevant to the matters in issue between the parties. The court may order under Order 14 rule 8 that affidavits be taken off the court file where there is scandalous or oppressive matter in an affidavit. However, counsel for the respondent argued that this court has an inherent power to strike out the scandalous or oppressive material and should exercise its power in this instance. The respondent's submission is that the respondent should not be deprived of its defence in the matter by the removal of its affidavits from the court file. There are clearly justiciable issues between the parties and it would be unconscionable for the applicant to obtain judgment without trial of the matter. As to the question of costs, the respondent's submission is that the court has the power to award costs in prescribed circumstances, Canceri v P.J. Taylor. The respondent argues that the exercise of the costs power by the court is limited by section 347 of the Act to proceedings instituted vexatiously or without reasonable cause. -7- It is submitted that it would be inappropriate to award costs in this matter as there is nothing to suggest that the proceedings had been instituted or defended vexatiously or without cause. The power of the court upon default. Order 10, rule 7 of the Industrial Relations Court Rules deals with procedure on default. Rule 7 states in part as follows: "7(1) If a party fails to comply with an order of the Court directing that party to take a step in the proceeding, any other party may move the court on notice: (a) ... (b) If the party in default is a respondent - for judgment or an order against the respondent; (c) ... 7(2) The Court may make an order of the kind mentioned in subrule (1) or any other order or may give such directions, and specify such consequences for non-compliance with the order, as the court thinks just." Order 10, rule 7, gives this court a fairly wide discretionary power upon default. The applicant relies on two decisions in support of his application to enter interlocutory judgment, Charles v Shepherd and Termijtelen v Van Arkel and Another. The combined effect of these two decisions seems to be that the Court does have a discretion in exercising its powers. There is a discretion to enter an interlocutory judgment which requires to be worked out subsequently. However, Charles v Shepherd also makes it clear that the court has a discretion to refuse to make the order asked for if there is reason to doubt whether injustice may not be done by giving judgment. (See Lord Esher, MR at page 624). -8- Counsel for the respondent referred to the decision in Lenjimar Pty Limited and Others v AGC (Advances) Pty Ltd in which order 10, rule 7 of the Federal Court Rules was discussed. That rule is couched in terms almost identical to order 10, rule 7 of the Industrial Relations Court Rules. Wilcox and Gummow, JJ, stated at page 208: "It is to be noted that the power given by this rule is conditioned on one circumstance only: the failure of a party to comply with an order of the court directing that party to take a step in the proceeding. There is no requirement of intentional default or contumelious conduct although the attitude of the applicant to the default and the court's judgment as to whether or not the applicant genuinely wishes the matter to go to trial within a reasonable period will usually be important factors in weighing the proper exercise of the discretion conferred by the rule. There is no requirement of `inordinate and inexcusable delay' on the part of the applicant or the applicant's lawyers although any such delay is likely to be a significant matter. There is no requirement of prejudice to the respondent although the existence of prejudice is also likely to be significant. The observations which we have just made about the scope of Order 10, rule 7 are not intended to convey the impression that any failure to comply with a procedural direction will appropriately result in the dismissal of the proceeding. On the contrary, the rules must be administered sensibly and with an appreciation both of the fact that some delays are unavoidable and unpredictable by even the most conscientious parties and their lawyers and of the likely serious consequences to an applicant of staying or dismissing a claim." And at page 209: "If when the court looks at the matter, the direction has already been complied with, the defaulting applicant may be ordered to pay any wasted costs but it would be difficult to justify the dismissal of the proceedings solely because of that default."