Anthony Linnane v Monash University [1995] IRCA 649

INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 4689 of 1995 B E T W E E N : ANTHONY LINNANE Applicant AND MONASH UNIVERSITY Respondent Before:Judicial Registrar Murphy Place: Melbourne Date: 13 December 1995 REASONS FOR JUDGMENT The Court has before it a motion that pursuant to Order 20 Rule 2 of the Rules of Court that the Application be dismissed or alternatively permanently stayed. The grounds for the motion were that the Court had no jurisdiction because at the date of the issuing of the proceedings there had been no termination of employment at the initiative of the employer. A related argument was that because there had been no termination of employment the Court lacked jurisdiction as it could not grant a remedy. The final argument of the Respondent on the notice of motion was that the contract of employment between the parties was in any event for a fixed term and thus excluded pursuant to Regulation 30B of the Industrial Relations Regulations. Principles to be applied for summary dismissal of an application There is little dispute as to the approach to be applied by a court in determining whether to exercise its power to summarily dismiss an application under a provision like Order 20 Rule 2. Although the terminology used varies between the cases the approach is that the jurisdiction to summarily dismiss is only to be exercised in very clear cases, where the claim is clearly untenable, and with particular caution when dealing with legislation in an embryonic stage of development: see, eg Cooper v Darwin Rugby League Inc (1994) I IRCR 130, 131, Association of Professional Engineers, Scientists and Managers, Australia and Anor v David Graphics Pty Ltd (1994) 1 IRCR 193, 197, Barnes v Ranger Uranium Mines Pty Ltd (1993) 50 IR 38, 41-42 and Communications Electrical Electronic Energy Information Postal Plumbing and Allied Services Union of Australia v Western Australian Speciality Alloys Pty Ltd, (Industrial Relations Court of Australia, Madgwick J, 12 October 1995). The Respondent agrees to employ the Applicant until 30 December 1998 The Respondent is a body corporate established pursuant to an Act of Parliament. Under the relevant Act the Council of the University ("the Council") is the governing body of the University and has the power to appoint and dismiss academic staff. In 1975 the Council decided that academic staff should retire in the year in which they reach 65 years. The Council resolution also provided that in exceptional circumstances appointments beyond the age of 65 may be made where it is in the interests of the University to do so. The Council resolution also provided that the Council may authorise the Vice-Chancellor to appoint staff for a period of up to one year after the age of 65. Appointments for longer than one year could, pursuant to resolutions made by the Council, only be made by the Council. Those resolutions of the Council remained unchanged until 31 October 1994 when the Council authorised the Vice-Chancellor to appoint staff, on behalf of the Council, for a period of up to three years after the retirement age of 65. By letter dated 19 August 1994 ("the letter") signed by Susan E Harrison ("Harrison"), Director of the Personnel Services Division of the University, to the Applicant the Respondent offered the Applicant appointment as full-time Director of the Centre for Molecular Biology and Medicine ("the Centre") and Professor of the University from 1 September 1994 until 31 December 1995. The letter further offered the Applicant an appointment as Director "wholly within the Centre" for the period from 1 January 1996 until 31 December 1998. The letter was headed "Amended Offer" and was stated to replace two previous offers made. The letter noted that "this is a new appointment within the University" and went on to discuss a number of other issues relating to the operations of the Centre, secretarial and other assistance and remuneration. The Applicant signed the letter on 19 August 1994 agreeing to commence duties on 1 September 1994. The Applicant in August 1994 held a Chair in the Department of Biochemistry and Molecular Biology and was Head of the Department. Pursuant to the agreement contained in the letter he resigned as Head of Department, with effect from 31 August 1994, and became the full-time Director of the Centre. By letter dated 7 December 1994 the University gave the Applicant notice of an allegation of serious misconduct against him arising out of an incident on 21 November 1994. Pursuant to Clause 9(h) of the Australian Universities Academic Staff (Conditions of Employment) Award 1988 ("the Award") the Vice-Chancellor established a Committee of Investigation ("the Committee") to investigate the allegations. That Committee's investigation remains unconcluded. Pursuant to Clause 9(l) of the Award the Committee must, after hearing and considering the evidence and submissions made before it, report to the Vice-Chancellor. The Committee is required to make a recommendation about whether the Vice-Chancellor should exercise any powers available to him under Clause 9(e) of the Award. Clause 9(e) of the Award gives the Vice-Chancellor power to censure, withhold an increment in salary, demote or dismiss an employee. Under Clause 9(n) of the Award the Vice-Chancellor shall act on the Committee's findings. In letters between the parties dated 19 and 25 July 1995 the Respondent advised the Applicant's Solicitors that the Applicant's employment will terminate with the University on 31 December 1995 "unless an earlier termination should occur as a consequence of the findings of the Committee of Investigation". The letter of 19 July stated that after 31 December 1995 "the University will not thereafter enter into any contract of employment with Professor Linnane". An Affidavit sworn by Ms Susan Bath, the Policy and Legal Counsel of the Respondent indicates that at no stage has a proposal to appoint the Applicant for a period after 31 December 1995 been presented to the Council. The Affidavit further deposes that the Vice-Chancellor does not intend to exercise, in relation to the Applicant, the power granted to him by the Council in October 1994 to make appointments of staff after the age of 65 for periods up to three years, or to present to the Council a proposal to appoint the Applicant for any period after 31 December 1995. It is apparent from the material above that arguably, pursuant to "a formal contract of employment" dated 19 August 1994, Harrison, on behalf of the Respondent, agreed to employ the Applicant in the capacity of Director of the Centre for the period from 1 September 1994 until 30 December 1998. For the period 1 September 1994 to 31 December 1995 the Applicant would also be a Professor of the University. It further appears that at the time of the agreement, pursuant to previous resolutions of the Council, the proper procedures of the Council had not been followed in order to authorise Harrison, on behalf of the Vice-Chancellor, to reach such an agreement with the Applicant. It is further apparent that pursuant to the powers granted to the Vice-Chancellor by the Council in October 1994 the Vice-Chancellor does not intend to recommend that the Council offer to the Applicant any employment after 31 December 1995. This is irrespective of whether or not prior to that date the Applicant's employment ceases consequent upon the findings of the Committee. On 7 September 1995 the Applicant through his Solicitors issued proceedings under Section 170EA of the Act seeking "reinstatement and/or compensation". The Applicant remains in his positions, is still being paid his salary and is discharging the duties of his offices as Director of the Centre and Professor within the University. Was the Applicant entitled to commence this proceeding? Section 170EA(3)(a) provides that an employee may apply for a remedy in respect of the termination of his or her employment "within 14 days after the employee receives written notice of the termination". The meaning of the terms "termination of employment" and "termination at the initiative of the employer" has been considered in a number of leading cases including Siagian v Sanel Pty Limited (1994) 1 IRCR 1, APESMA v Skilled Engineering Pty Ltd (1994) 1 IRCR 106 and Mohazab v Dick Smith Electronics Pty Limited, (Industrial Relations Court of Australia, Lee, Moore and Marshall JJ, 28 November 1995). In APESMA (above), at 116 Gray J stated that for the purposes of Section 170EA(3) the giving of notice of termination was to be regarded as the "termination". In Mohazab (above) the Full Court said:- "In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentialy in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship". Applying these comments the Applicant has an arguable case that the proceedings will succeed for the following reasons. The letter makes no reference to the giving of notice to terminate the agreement between the Applicant and the University that he hold the position of Director or as Professor within the University. On its face however the letter envisages a contract of employment enduring until 31 December 1998. The letters by the University on 19 and 25 July 1995 purport to give notice of the termination of the Applicant's employment on 31 December 1995. It is clear that it is open for the Applicant to construe those letters as written notice of termination of employment. It can be argued to that extent that the Applicant should have commenced his proceedings within 14 days after receipt of either or both of those letters. The comments in the cases referred to show that for the purposes of the accrual of jurisdiction under the Act it is the actions of the employer rather than the legal validity of those actions that is relevant. The letters of 19 and 26 July are actions of the employer purporting to terminate the Applicant's employment on 31 December 1995. The existence of the letter signed by the parties agreeing to a contract of employment that continues after that date leads to the conclusion that the Applicant has an arguable case that should not be summarily dismissed. The second ground of the Respondent's argument was that because the Applicant remains in employment and was being paid then there was no remedy available to the Court pursuant to Section 170EE of the Act. This argument fails to address the comments made by Gray J in APESMA (above) at 116 when he said:- "Both the requirement that expressions in Div 3 of Pt VIA be given the same meanings as in the Convention and the form of the provisions of Div 3 therefore suggest that "termination" refers to what is done by an employer attempting to bring about the end of the employment. The legislative intention is to permit applications under s 170EA of the IR Act if an employer has done some act terminating or purporting to terminate the employment, irrespective of whether the act is effective to bring about the termination without some further act on the part of the employee. The "termination" referred to in s 170EA and in s 170EE is the act of the employer. If the act of the employer is effective to terminate the contract of employment, remedies appropriate to that situation can be granted. If the contract remains on foot, the Court still has the power under s 170EE(1) to "make such orders as it thinks appropriate in order to put the employee in the same position (as nearly as can be done) as if the employment had not been terminated. Such a remedy might involve declaring that the act of the employer was ineffective to determine the contract and the making of consequential orders requiring the employer to treat the contract as still on foot. In many cases, for practical purposes, it will be unnecessary to decide whether the contract remains on foot or not. The remedy of reinstatement, with compensation for any loss during the period prior to judgment, will usually be appropriate in either case. It is obviously intended by s 170EE that this combination of remedies will be the primary resort of the Court. It is the most obvious way to put the employee in the same position (as nearly as can be done) as if the employment had not been terminated. Of course, there is a discretion to grant other remedies, including compensation without reinstatement, in appropriate cases. I refer again to Art 10 of the Convention, which requires that the relevant court or tribunal have power "to declare the termination invalid and/or order or propose reinstatement". Reinstatement is contemplated as a remedy which might be granted to those whose employment is still on foot and to those whose employment has been brought to an end." Even if it may be accepted that the Respondent had no legal authority to make the agreement it made by the letter of 19 August 1994 the Applicant has an arguable case that he is entitled, by virtue of some ostensible authority of Harrison, to be treated as if he had a contract of employment that continued until 1998. In those circumstances, although APESMA (above) was decided before amendments to the legislation which altered the nature of the remedies available to the Court the Applicant may be entitled to a declaration to this effect under Section 170EE of the Act.. The final argument of Counsel for the Respondent was that the agreement between the parties here was a fixed term contract and thus was excluded under Regulation 30B of the Industrial Relations Regulations. In Cooper (above) Northrop J was considering a contract of employment for a fixed period. The contract, in contrast to the present agreement constituted by the letter of 19 August 1994, did contain provision for a notice of termination. In considering however whether in fact the contract was excluded under Regulation 30B Northrop J noted that the contract had been terminated by the employer. At 134 he said:- "The employment was not terminated by agreement of the employer and employee. It was not terminated by effluxion of the period of time specified in the contract of employment. In these circumstances, it is only fair that the issue of whether the termination was lawful or not depends upon all of the facts leading up the unilateral termination of employment by the respondent. The Court has not considered those facts". Here, the Applicant clearly has an arguable case that he has a contract of employment that continues until 31 December 1998. That contract has, by the letters of 19 and 26 June 1995 purportedly been terminated by the Respondent effective 31 December 1995. He has an arguable case that the termination was unlawful. On the authority of Cooper (above) that issue should be determined at the trial of the proceeding. The Respondent has failed to make out any of its arguments that this a clear case where the Applicant should not be entitled to proceed with his application. The notice of motion should be dismissed. MINUTES OF ORDERS THE COURT ORDERS: 1. The Respondent's motion is dismissed. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. I certify that this and the preceding seven (7) pages are a true copy of the reasons for judgment of Judicial Registrar Murphy. Associate: Dated: 13 December 1995 Solicitors for the Applicant: Messrs Slater & Gordon Counsel for the Applicant: Mr M Bromberg Solicitor for the Respondent: Ms Susan Bath, Policy and Legal Counsel Counsel for the Respondent: Mr N Green Date of hearing: 5 December 1995 Date of judgment: 13 December 1995