DECISION NO: 183/96 C A T C H W O R D S INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - PRACTICE AND PROCEDURE - APPLICATION to joint third party to PROCEEDING Industrial Relations Act 1988 s170EA Industrial Relations Court Rules 05 r8 CASES: McGrath v Council of the Municipality of Fairfield (1985) 156 CLR 672 Lister v Romford Ice & Storage Co Ltd [1957] AC 555 Mahnken v Saunders Logging Pty Limited (1994) 57 IR 237 ROBYN-JANE ROSS -v- NULAB AUSTRALIA (MELBOURNE) PTY LTD No. VI 1067 of 1995 Before: Judicial Registrar Murphy Place: Melbourne Date: 23 April 1996 INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 1067 of 1996 B E T W E E N : ROBYN-JANE ROSS Applicant AND NULAB AUSTRALIA (MELBOURNE) PTY LTD Respondent MINUTES OF ORDERS Judicial Registrar Murphy 23 April 1996 THE COURT ORDERS: 1. Paragraph 1 of the Notice of Motion is dismissed. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 1067 of 1996 B E T W E E N : ROBYN-JANE ROSS Applicant AND NULAB AUSTRALIA (MELBOURNE) PTY LTD Respondent Before: Judicial Registrar Murphy Place: Melbourne Date: 23 April 1996 EX-TEMPORE REASONS FOR JUDGMENT By Notice of Motion, filed 21 March 1995, the respondent seeks, pursuant to Order 5 rule 8(1), to join Mr John Reid Dowell the party to the proceeding to claim "damages or contribution or indemnity" against him arising out of the application. The application is opposed by both the applicant and Mr Dowell. In support of the motion the respondent filed two affidavits by its managing director, Mr Warshall and an affidavit by an industrial relations consultant, Mr Reiffel. Mr Dowell filed an affidavit in opposition. The first affidavit by Mr Warshall alleges that there may have been collusion by the applicant with Mr Dowell in relation to the termination of the applicant's employment, and that Mr Dowell may have wilfully failed to comply with instructions given to him by Mr Warshall as to the manner in which he was to carry out the termination of the applicant's employment. Mr Dowell in his affidavit denied any collusion and said that proper procedures, as instructed by Mr Warshall, were followed. In opposition to the motion, counsel for Mr Dowell argued that the proposed claim by the respondent was not recognised at law. The argument was that there could be no contribution by Mr Dowell against any liability of the respondent to the applicant's claim because there was no vicarious liability, such as applied in Lister v Romford Ice & Storage Co Ltd [1957] AC 555. He further argued that there was no basis to claim indemnity as the scheme of Part VIA of the Industrial Relations Act is to impose liability on employers and it would be contrary to good industrial relations to seek to allow employers to shift responsibility for their obligations under the Act to employees through contribution or indemnity proceedings. He referred to the decision of the High Court in McGrath v Council of the Municipality of Fairfield (1985) 156 CLR 672, which dealt with legislation to remove the effect of the decision in Lister v Romford Ice (above). Counsel also referred to the difficulty of ascertaining the actual liability of the respondent in the proceedings to then shift to Mr Dowell. In Mr Warshall's affidavit he is alleging that Mr Dowell may have failed to effect the termination of the applicant's employment in a procedurally proper manner. There is merit in the submissions. I am satisfied that if the respondent was allowed to agitate these issues in this proceeding it would unbalance the proceeding which is the application pursuant to s170EA by the applicant for a remedy for a breach of the Act. The whole basis of Part VIA of the Act is to implement the Convention on the Termination of Employment. The Convention is designed to give certain rights to the parties associated with the termination of employment at the initiative of the employer. The primary remedy of the Act is reinstatement. It is only when it is held to be impracticable that an order for compensation can be made. It would unnecessarily complicate the hearing of proceedings if the Court allowed the respondent to agitate proceedings internal to its operations in third party proceedings. I refer to the decision of Mahnken v Saunders Logging Pty Limited, (1994) 57 IR 237 where Northrop J said: "These are in circumstances where Parliament has created a new type of remedy, a remedy which should be made available as quickly as possible where an employee's employment has been terminated. Reinstatement may be an order that is made. If such an order is to be made, it should be made as speedily as possible." A further consideration in this particular case is Exhibit JRD1 to Mr Dowell's affidavit, which is an "Executive Employment Agreement" between himself and the respondent and another company. Clause 13 of the agreement provides that if there is a dispute between the parties in relation to "the performance or obligations of the parties" then the parties are required to refer the matter to arbitration in accordance with the provisions of the Commercial Arbitration Act. There is a good argument that the respondent is precluded from agitating the liability of Mr Dowell in these proceedings on the basis of the provisions of the Executive Employment Agreement. There are also strong policy grounds for not allowing the speedy and primary remedy of reinstatement to be displaced by arguments within an employer as to liability associated with the termination of employment. It follows from this that I propose to refuse the Notice of Motion and find that on policy grounds, on balance of convenience grounds and on the basis of the material relating to the Executive Employment Agreement, it is not proper to allow leave to the respondent to join Mr Dowell as a third party to these proceedings. Paragraph 1 of the Notice of Motion is dismissed. MINUTES OF ORDERS THE COURT ORDERS: 1. Paragraph 1 of the Notice of 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 three (3) pages are a true copy of the reasons for judgment of Judicial Registrar Murphy. Associate: Dated: 23 April 1996 Solicitors for the Applicant: Holding Redlich Counsel for the Applicant: Mr Leigh A Johns Solicitors for the Respondent: Gary Katz & Associates Counsel for the Respondent: Mr Gary Katz Solicitors for Respondent to Notice of Motion Anthony D Goldsmith Counsel for Respondent to Notice of Motion Mr L W Maher Date of hearing: 23 April 1996 Date of judgment: 23 April 1996