Jeffrey Roy Charles Morton v Truefeat Pty Limited and Others [1995] IRCA 266

CATCHWORDS INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - JURISDICTION - Identity of Employer - Corporations Law - Requirement for Leave to Proceed. Industrial Relations Act 1988 ss170EA, 170CD Corporations Act 1989 ss 444D, 444E Brash Holdings Limited and Others -v- Kaytile Pty Limited and Another (1994) 12 ACLC 472 Jeffrey Roy Charles Morton -v- Truefeat Pty Limited and Others No. AI 0224 of 1994 to 0237 of 1994 inclusive COURT: LINKENBAGH JR PLACE: SYDNEY DATE: 2 JUNE 1995 INDUSTRIAL RELATIONS COURT OF AUSTRALIA NEW SOUTH WALES REGISTRY No. AI 0224 OF 1994 - AI 0237 OF 1994 INCLUSIVE BETWEEN: JEFFREY ROY CHARLES MORTON Applicant AND: TRUEFEAT PTY LTD and OTHERS Respondent BEFORE: LINKENBAGH PLACE: SYDNEY DATE: 2 JUNE 1995 REASONS FOR JUDGMENT (Ex Tempore judgment revised from transcript) The judgment is in each of the proceedings listed before the Court today including the matters which were listed for directions and the matters listed for hearing on preliminary issues. These are applications brought by the applicant pursuant to section 170EA of the Industrial Relations Act 1988. In each application he seeks a remedy in respect of what he alleges is termination of employment on 4 July 1994. The matters raised several complex and interesting issues of law and are listed today for the purpose of considering preliminary matters as to whether the Court may entertain a hearing of the substantive merits of the applications. I propose to address some of the issues that have been raised. The order that I will make in each matter is that the application be dismissed and my reasons are as follows: The applications were filed on 25 November 1994 alleging, a last date work of 4 July 1994. There were strictly no written reasons given for the termination except that on that date there were orders made in the Federal Court at Sydney in proceedings in which the applicant in these proceedings was described as the first respondent. Those proceedings were numbered NG 378 of 1994. The orders which were made by that Court on that day followed on from interlocutory orders which were made on 23 June 1994 in the same proceedings. The effect of the orders of the Court was to restrain Mr Morton from being further involved in the business of Truefeat Pty Limited and effectively as well Budlyre Pty Limited and Benelan Pty Limited. Mr Morton was a party to those proceedings in the Federal Court and is subject to the orders of the Court. I treat those proceedings in the Federal Court as effectively the act of termination of any employment which may have existed in relation to the three companies that I have named. The proceedings in this Court are substantially out of time if any act which constitutes written notice occurred on 4/7/94. I find that the orders of the Federal Court constitute written notice. The applicant was ordered by me on 5 May 1995 to file and serve affidavits setting out the evidence he seeks to rely on by 4pm on 12 May 1995 and on the same day he was notified, and he was present in Court before me, that the matters would be listed today for the hearing of preliminary legal matters as to the jurisdiction of the Court to entertain to the applications. The applicant did not comply with the direction. The applicant was further ordered to file and serve any submissions in reply to submissions of the respondent by 31 May. The respondent filed its submissions on 15 May within the time allowed by me and the applicant has not filed any submissions. The applicant filed voluminous affidavit material yesterday and this morning. I find that all of the material filed by the applicant is irrelevant to these proceedings and I do not take any account of it on that basis and also the basis that a large part of material is prima facie prejudicial to the interests of parties who are in no way connected with these proceedings. I am not satisfied that he applicant has explained sufficiently his delay in bringing his applications before this Court. He told the Court today that he has proceedings in other jurisdictions and has been very busily involved in those proceedings and did not have time to file his applications in this Court within the time required by the rules. I do not accept that that is a sufficient reason. I turn to the question of the jurisdiction of the Court under section 170CD of the Act. The applicant has not brought any evidence before me as to the identity of his employer or employers and there is no evidence before me provided by the applicant to substantiate his assertion that he was employed by each of the 15 respondents in the proceedings before me. The only evidence on which I can rely in relation to the identity of the employer and the existence of a employer/employee relationship is the annexure to the affidavit of the solicitor of the respondent which is annexure A to Ms Redfern's affidavit of 15 May 1995. That is a Group Certificate indicating that Geoffrey Roy Morton was employed by Truefeat Pty Limited trading as Champions Video, ACN 053684010 from 1 July 1993 to 30 June 1994. That group certificate shows a gross income by way of salary, wages, bonus, etcetera, of $60,008. The applicant's employment terminated on 4 July 1994 and he is therefore subject to the limitation which was included in section 170CD(2) of the Act by the amendments which came into effect on 30 June 1994. In respect of the employment with Truefeat Pty Limited he is outside of the upper limit provided by that section and the jurisdiction of the Court is therefore denied on that basis. In relation to the other companies, as I have said, there is no evidence before me that he was an employee of any of those companies. Another matter which has been raised by the respondent is the question of whether or not the termination of any employment by any of the companies was in fact at the initiative of the employer. I have found that the employer was Truefeat Pty Limited, and even if there were not the other reasons for denying the Court's jurisdiction to the applicant on the evidence before me, on a substantive hearing in this matter the Court would be unable to, in my view, find that this was a termination at the initiative of the employer within the ordinary meaning of those words. The applicant was the managing director of the Truefeat Pty Limited and that company was an administration company for the other companies who are named as respondents in the proceedings. The applicant's relationship with Truefeat Pty Limited was brought to an end by reason of the orders made by the Federal Court on 4 July 1994. In those circumstances I do not believe that this Court would be able to reasonably find that there was a termination of the initiative of the employer within the meaning of the Industrial Relations Act. One further reason for the applicant's difficulties in being able to proceed with any of these matters is the requirement of section 444E of the Corporations Law. I address this matter as it has been raised by the respondent. Section 444E(3) provides that: A person cannot begin or proceed with a proceeding against a company whilst there is in existence a Deed of Arrangement in respect of that company's affairs. In relation to Truefeat Pty Limited, which I have found was the employer, a Deed of Arrangement was entered into on 21 December 1994. Section 444E therefore comes into play in respect of any persons having proceedings against the company. It might be said that the applicant in proceedings of this kind is not a creditor of a company so that the provisions of the Deed of Arrangement do not apply to him. In Brash Holdings Limited and Others v Kaytile Pty Limited and Another, a decision of the Full Court of the Supreme Court of Victoria reported in (1994) 12 ACLC 472, the Court gave the meaning of the word, creditor, in section 444D of the Corporations Law a wide meaning. I am satisfied that an applicant in proceedings before this Court falls within the definition of creditors who are bound by a Deed of Arrangement under section 444D of the Corporations Law. The effect of that is that Mr Morton is precluded from carrying on these proceedings unless he has the leave of the Court pursuant to section 444E(3). He concedes today that that leave has not been sought or granted and that is another reason for which he is incompetent to bring an application before this Court. For all of those reasons, my order in each of these matters is that the application be dismissed. I certify that the proceeding five (5) pages are a true and correct copy of the reason for judgement of Judicial Registrar Linkenbagh. Associate: Caroline Sternberg Date: 20 June 1995 Appearances: Applicant: Self Solicitor for Respondent: Ms Jan Redfern, Hunt & Hunt