Industrial Relations Commission of New South Wales in Court Session CITATION : Michael John Burgess and others v Mount Thorley Operations Pty Limited [2002] NSWIRComm 290 APPELLANTS: Michael John Burgess, Geoffrey Ian Bright, Ross Allen Brown, John Douglas Cuddigan, Barry Fong, Leslie James Irvine, William Robert Hoye, Rodney William Jones, Charles Anthony Mitchell, Michael Matthew Phillips, Michael Bruce Sampson, Marvyn Smith, Frederick George Veigekl, Raymond Gordon Wills PARTIES : RESPONDENT: Mount Thorley Operations Pty Limited FILE NUMBER: IRC3321 - 3334 of 2002 CORAM: Walton J Vice-President CATCHWORDS : Appeal - Stay - Practice and procedure - Jurisdiction to grant stay of proceedings - Jurisdiction of Full Bench to determine costs at first instance in absence of prior determination - Principles to be applied to granting of stay - Filing of appeal per se not sufficient - Test whether demonstrate adequate reason for stay to warrant exercise of discretion - Balance of convenience - Prospects of success - Whether hearing on indemnity costs could prejudice remittal - Costs and inconvenience - Desirability of all matters including costs to be determined at first instance before appeal heard - Stay declined Federal Court of Australia Act 1976 (Cth) ss21 22 23 Industrial Relations Act 1988 (Cth) LEGISLATION CITED : Industrial Relations Act 1996 ss184 190 191 192 Judiciary Act 1903 (Cth) s39 Workplace Relations Act 1996 (Cth) ss152 153 412 BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 Burgess and Others v Mount Thorley Operations Pty Limited [2002] NSWIRComm 106 Burgess and Others v Mount Thorley Operations Pty Ltd (No 2) (1999) 100 IR 260 Campbells Cash & Carry v National Union of Workers, New South Wales Branch (2001) 104 IR 400 Mount Thorley Operations Pty Limited v Raymond Gordon Wills & Others [1999] NSWIRComm 482 CASES CITED : Mt Thorley Operations Pty Limited v Burgess & Ors (2001) 103 IR 184 Re Marks: Australian Conciliation and Arbitration Commission ex parte Australian Building Construction Employees' and Builders Labourers' Federation (1981) 147 CLR 417 Re Transport Industry - Waste Collection and Recycling (State) Award (2000) 102 IR 192 HEARING DATES: 08/30/2002; 09/09/2002; 09/16/2002 DATE OF JUDGMENT: 11/01/2002 APPELLANTS: Ms L Doust RL Whyburn & Associates LEGAL REPRESENTATIVES: RESPONDENT: Mr BKB Cross of counsel SOLICITOR: Ms J Glynn Freehills JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Walton J, Vice-President 1 November 2002 Matter No. IRC 3321 of 2002 MICHAEL JOHN BURGESS V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Michael John Burgess for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3614 of 1998 Matter No. IRC 3322 of 2002 GEOFFREY IAN BRIGHT V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Geoffrey Ian Bright for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3618 of 1998 Matter No. IRC 3323 of 2002 ROSS ALLEN BROWN V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Ross Allen Brown for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3625 of 1998 Matter No. IRC 3324 of 2002 JOHN DOUGLAS CUDDIGAN V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by John Douglas Cuddigan for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3627 of 1998 Matter No. IRC 3325 of 2002 BARRY FONG V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Barry Fong for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3620 of 1998 Matter No. IRC 3326 of 2002 LESLIE JAMES IRVINE V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Leslie James Irvine for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3621 of 1998 Matter No. IRC 3327 of 2002 WILLIAM ROBERT HOYE V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by William Robert Hoye for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3622 of 1998 Matter No. IRC 3328 of 2002 RODNEY WILLIAM JONES V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Rodney William Jones for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3617 of 1998 Matter No. IRC 3329 of 2002 CHARLES ANTHONY MITCHELL V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Charles Anthony Mitchell for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3619 of 1998 Matter No. IRC 3330 of 2002 MICHAEL MATTHEW PHILLIPS V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Michael Matthew Phillips for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3626 of 1998 Matter No. IRC 3331 of 2002 MICHAEL BRUCE SAMPSON V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Michael Bruce Sampson for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3624 of 1998 Matter No. IRC 3332 of 2002 MARVYN SMITH V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Marvyn Smith for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3616 of 1998 Matter No. IRC 3333 of 2002 FREDERICK GEORGE VEIGEKL V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Frederick George Veigekl for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3623 of 1998 Matter No. IRC 3334 of 2002 RAYMOND GORDON WILLS V MOUNT THORLEY OPERATIONS PTY LIMITED. Application by Raymond Gordon Wills for leave to appeal and appeal against a decision of Justice Schmidt on 21 May 2002 in matter No IRC 3615 of 1998 JUDGMENT [2002] NSWIRComm 290 Background to the Appeal 1 Mr Michael John Burgess and thirteen others (the applicants and present appellants) were employed by Mount Thorley Operations Pty Limited (the respondent in these proceedings), which operated a large open cut mine at Singleton. The appellants' employment was regulated by terms of an award made by the Coal Industry Tribunal, the Coal Mining Industry (Supervision and Administration) Interim Consent Award 1990, New South Wales and Tasmania ("the Award") and by the terms of an enterprise agreement, the Mount Thorley Operations Enterprise Agreement 1996 ("the EA") certified by the Australian Industrial Relations Commission ("the AIRC") under the provisions of the Industrial Relations Act 1988 (Cth) ("the 1988 Act"). The appellants' employment was brought to an end in November 1997, after a restructure at the mine, which led to the redundancy of some 250 employees. 2 The appellants each commenced proceedings seeking orders pursuant to s106 of the Industrial Relations Act 1996 ("the Act") that the contracts, arrangements or collateral arrangements under which they performed work for the respondent and under which they received termination payments: (a) be declared void in whole or in part; (b) were unfair, harsh or unconscionable and contrary to the public interest; (c) be varied to provide 12 months' termination notice, and, in the case of redundancy, an additional payment equivalent to four weeks' notice for each completed year of service; (d) be varied to incorporate a remedial procedure in the case of termination for unsatisfactory performance requiring warnings in writing and a minimum six month period for retraining, or for the employee to redress any concern raised; and seeking orders for consequential monetary relief. 3 The jurisdiction of this Court to entertain these applications was challenged in various proceedings, but ultimately fell to be determined by this Court at first instance. In a judgment given by Marks J in Burgess and Others v Mount Thorley Operations Pty Limited (No 2) (1999) 100 IR 260, his Honour concluded that it was premature to consider the jurisdictional point raised by the respondent at that stage of the proceedings by notice of motion. The respondent's appeal from that decision was dismissed by a Full Bench of the Court in Mount Thorley Operations Pty Limited v Raymond Gordon Wills & Others [1999] NSWIRComm 482 on the basis that, although there was doubt as to the Court's jurisdiction to grant all of the claims made, the decision of Marks J was available as a matter of discretion. 4 The respondent approached the Federal Court for declaratory orders under s39B(1A)(c) of the Judiciary Act 1903 (Cth), ss152, 153 and 412 of the Workplace Relations Act 1996 (Cth) and ss21, 22 and 23 of the Federal Court of Australia Act 1976 (Cth), in relation to the orders sought in these proceedings. It was argued that the relief sought, if granted, would be inconsistent with the terms of the EA and hence invalid. Moore J, in Mt Thorley Operations Pty Limited v Burgess & Ors (2001) 103 IR 184, declined to entertain the declaration sought, taking the view that it was premature to do so before this Court had made any orders in the initial proceedings, because any potential inconsistency could not arise until such orders were made. The Federal Court proceedings were thus stayed, with liberty to the parties to have them relisted. 5 The decision which is the subject of these appeal proceedings was given by Justice Schmidt on 21 May 2002 in Burgess and Others v Mount Thorley Operations Pty Limited [2002] NSWIRComm 106 and was based primarily on the following conclusions: (a) It was common ground that the applicants had been made redundant as a result of restructuring and were not terminated for reasons connected with their conduct or performance; (b) Neither the Award nor the EA formed a part of the applicants' employment contracts and this finding was sufficient to dispose of the applicants' claims as advanced. There was no evidence that the parties had expressly agreed to incorporate the EA or the Award as terms of the employment contracts, or that they even turned their minds to this issue. Nor could the Award or the EA be implied into the employment contracts as, following BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266, the contracts were effective without such an implication. Finally, such an implication could not be made on the basis of custom, practice or course of dealing. (c) To the extent that the applicants' claims depended upon a determination that the respondent breached its obligations under the EA and Award, the claims must fail. This Court did not have the jurisdiction to make such a determination, as the Workplace Relations Act 1996 prescribed a code for the management of such complaints before the Federal Court. (d) The applicants' claims as advanced suffered an insurmountable difficulty: the final relief sought directly concerned subjects dealt with comprehensively by both the Award and the EA - termination of employment and the amount of money to be paid upon such termination. If the Award and EA were to be incorporated into the employment contracts and the Court acceded to the applicants' supplication any resultant order would be inconsistent with the requirements of the Award and EA. The Award and EA, stemming as they do from federal legislation, must prevail in the case of any inconsistency. An application brought under the Act could not properly be used to circumvent the enforcement provisions for award breaches contained in federal legislation. 6 Her Honour made the following order at paragraph [200]: For all of these reasons, I have concluded that the basis upon which the applicants advanced their claims was not made out, as to ground a basis for the relief sought, and that the Court has no jurisdiction to entertain the orders sought in any event. Accordingly, the applications are dismissed. The usual order as to costs would be that the applicants should bear the respondent's costs, as agreed or assessed. If no agreement is reached within 21 days of this judgment as to the appropriate costs order, the parties have liberty to approach. 7 The respondent then applied for costs on an indemnity basis. 8 The appellants filed Applications for Leave to Appeal and Notices of Appeal on 11 June 2002 seeking: leave to appeal; that the judgment at first instance be set aside; that the matter be remitted to Justice Schmidt; costs of the appeal; and "a stay". On 19 June 2002 the appeal proceedings were listed for hearing of the appellants' stay application and for directions. The appellants advised the Court that, at that stage, they did not press for an order to stay the proceedings at first instance, but may, in the event of an adverse costs order, seek a stay of that order. The application for leave to appeal and the appeal were listed for hearing before the Full Court for two days from 10 February 2003. 9 On 21 June 2002 the respondent's application for indemnity costs was listed for directions; Schmidt J listed the matter for argument on 13 December 2002, with directions for the filing of evidence and submissions in the interim. The appellants foreshadowed enlivening their application for a stay of the proceedings before her Honour, pending the appeal process. The appellants advised this Court that Justice Schmidt directed that no step be taken in accordance with the directions until the application for a stay was determined. 10 On 1 July 2002 the appellants confirmed to this Court that they intended to pursue their application for a stay of the proceedings at first instance in order to restrain Schmidt J from hearing the question of costs. By consent, the parties agreed to forgo an oral hearing and the stay application proceeded by way of written submissions filed on behalf of the appellants on 19 August 2002 and on behalf of the respondent on 28 August 2002 and 9 September 2002. The appellants filed short submissions in reply on 16 September 2002. 11 Although the application for leave to appeal and notice of appeal does not enunciate a specific order, it does make the following reference to a stay at paragraph J, under the list of orders sought in relation to the appeal: J. A stay is sought because costs should not be ordered until determination of the appeal. 12 This judgment concerns the appellants' application for a stay, as clarified in proceedings before the Court on 1 July 2002. In addition to the arguments by the parties in relation to whether the Court should exercise its discretion to grant a stay, the respondent made two submissions which challenged the jurisdiction of this Court to grant the type of stay sought by the appellants. In view of the basis upon which I will resolve this matter, I propose to refer briefly to these submissions at the outset. Jurisdictional issues raised by the respondent 13 In submissions, the respondent raised two important preliminary jurisdictional issues as to the stay application, neither of which was answered (to any extent) by the appellants. 14 Firstly, the respondent submitted that the jurisdiction of the Full Bench pursuant to s190 of the Act is limited to the granting of stays of decisions under appeal, pending determination of that appeal. This jurisdiction does not extend to the granting of a stay of proceedings which are pending or underway. 15 Section 190 provides: If an appeal is made under this Part to a Full Bench of the Commission, the Full Bench or the Commission constituted by a Presidential Member may, on such terms as it considers appropriate, order that the decision concerned be wholly or partly stayed pending determination of the appeal or until further order of the Full Bench or Commission. 16 The distinction between a stay of an order or decision and a stay of proceedings is a well established one, and has been the subject (in different contexts) of many decisions in different jurisdictions, including the decision of the High Court in Re Marks: Australian Conciliation and Arbitration Commission ex parte Australian Building Construction Employees' and Builders Labourers' Federation (1981) 147 CLR 417. 17 Clearly the respondent's submission raises important issues of statutory interpretation and the extent of any inherent jurisdiction of the Commission in Court Session in relation to a stay of proceedings in an appeal matter. I am reluctant to make a decision on these matters in the absence of comprehensive argument, particularly when I consider that, as a discretionary matter (for reasons I shall explain) the stay should not in any event be granted. I simply note, without needing to decide the matter, that the respondent's submission is arguable. 18 For similar reasons, it is also unnecessary to decide the second jurisdictional issue raised by the respondent: whether the Full Bench has the power under s192 of the Act to determine the question of costs at first instance in the absence of any determination of that issue by Justice Schmidt. I have some reservations about this argument (see s181(4) of the Act) but it is presumably arguable when one has regard to ss191 and 192(2) which confine the scope of the Commission's powers in appellate review. However, as I have mentioned, it is not necessary for me to decide the issue in order to dispose of this stay application. Relevant Principles 19 The principles which govern the exercise of discretion in considering an application for a stay in appeal proceedings have been elucidated in two comparatively recent decisions: Re Transport Industry - Waste Collection and Recycling (State) Award (2000) 102 IR 192 and Campbells Cash & Carry v National Union of Workers, New South Wales Branch (2001) 104 IR 400. The appellant is required to establish or demonstrate a sufficient and proper basis for a stay. The decision as to whether to grant a stay is a discretionary one, to be made by the Court after considering, among other factors, the balance of convenience and the rights of the parties. In certain cases, it may be appropriate to consider (as a very preliminary assessment) whether an appellant has a reasonably arguable ground of appeal or whether there is a serious question to be tried. 20 I respectfully agree with the following principles which were succinctly stated in Re Transport Industry at [19]: 19 I consider that the following considerations derived from the discussion in the Cambridge Credit case are those relevant to apply in this matter: (1) The mere filing of an appeal will not of itself provide a reason or demonstrate an appropriate case nor will it discharge the onus which the applicant bears. (2) A court has an appropriate discretion whether or not to grant the stay and as to the terms that would be fair if a stay be granted. (3) The onus is upon the applicant for a stay to demonstrate a proper basis for a stay that will be fair to all the parties. (4) In the exercise of its discretion all considerations including the balance of convenience and the competing rights of the parties need to be considered and weighed. (5) Where there is a risk that the appeal will prove abortive or nugatory if the stay is not granted then the normal exercise of discretion will result in the grant of a stay. (6) Although, generally speaking, it is inappropriate in relation to an application for a stay to speculate as to the appellant's prospects of success, this does not prevent a court, in the context of considering the specific terms of the stay that will appropriately and fairly adjust the interests of the parties, from making a preliminary assessment as to whether the appellant has an arguable case. Consideration 21 The appellants have not made out a sufficient basis that would, in my view, warrant the grant of the stay sought. In particular, I have come to that conclusion having regard to what is fair to all parties in the circumstances of this matter and the balance of convenience (see the Transport Industry case). 22 The bulk of the appellant's submissions in support of a stay amount to little more than a statement that the matter is on appeal (which is specifically noted in the Transport Industry case as being insufficient to warrant a stay) and that the appellants have an arguable appeal case. In some cases it will be appropriate to consider the strength of an appeal as a preliminary assessment, in order to properly assess the balance of convenience and fairness to the parties (see Campbells Cash & Carry). This will often be in circumstances where the appeal may not reasonably be arguable, or has poor prospects of success, in which case a stay may well be unfair (for example, to a judgment creditor) or not be warranted upon an assessment of the balance of convenience. That is not to say that the converse is a matter of equal consideration. 23 I am prepared to accept, without detailed evaluation and in a purely preliminary way, the appellants' submission that the appeal is arguable, for the purposes of assessing this stay application. I note, however, the doubts expressed by the Full Court in Mount Thorley Operations Pty Limited v Raymond Gordon Wills & Others [1999] NSWIRComm 482 as to the Court's jurisdiction to grant all of the claims made by the appellants in the summonses for relief. 24 In Campbells Cash & Carry I found that the balance of convenience was not strongly in favour of the appellant, the real impact of a refusal of a stay being the effect on the appellant's administrative arrangements (namely, cost and possible inconvenience). The same determination must apply in this case, where, despite submissions on different issues (dealt with below), the appellants have demonstrated only that the refusal to grant a stay may result in cost and possible inconvenience - which would probably be incurred anyway, it being necessary at some stage to argue the costs of the proceedings at first instance in the absence of agreement. 25 In fact, considerations of cost and inconvenience weigh against this application for a stay. The granting of the stay may well expose the parties to greater cost, demands on time and resource and inconvenience, creating, as it would, the potential for additional appeal proceedings arising out of a later costs order (made after an unsuccessful appeal), rather than allowing the Full Bench to deal with any appeal as to the award, nature or amount of any initial costs order in the present appeal proceedings. As a general principle, it is desirable both from the point of view of efficiency and justice between the parties to have all matters determined at first instance before an appeal is heard. There are strong policy reasons in favour of streamlining the appeal process to allow for one, comprehensive appeal, to conclude all matters (often overlapping) which may arise from initial determinations. This outcome is also consistent with the usual practices of the Commission. In the assessment of the balance of convenience, this will be an influential factor mitigating against a stay of proceedings (assuming of course, the jurisdiction to grant such a stay). 26 The appellants made three additional submissions which I will deal with in turn. Firstly, the appellants submitted that Justice Schmidt should not determine costs at first instance because, following the appeal, the matter may be remitted to her Honour for further hearing. The argument is at best insubstantial. If the appeal were to be upheld, there is no reason necessarily to assume that the matter would be remitted to Justice Schmidt. Even if the matter were to be remitted to Justice Schmidt, the appellants have neglected to advance any reason as to why the prior hearing of an indemnity costs application would necessarily present any difficulties in such a remission, other than baldly stating that the matters raised in an indemnity costs application would be prejudicial to a rehearing. No reason was advanced as to why prejudice would necessarily follow and, indeed, the identification of any prejudice is not clear cut in circumstances which would require speculation as to whether Justice Schmidt would award indemnity costs and, if so, whether in doing so she would make any findings which may prevent her from hearing further aspects of the proceedings. Without any substantive evidence or submission as to the nature of any such matters which may be raised in relation to an indemnity costs application, and why they would be prejudicial to any matters which may require further hearing, I am not in a position to accept this submission. 27 Secondly, the appellants submitted that the respondent's prospects of obtaining indemnity costs are poor. No evidence was put before the Court to substantiate this submission. I cannot see the relevance to the present application and consider, if anything, that this submission mitigates against the granting of a stay. Justice Schmidt, having the most detailed knowledge of the proceedings at first instance, would be the judicial member most appropriate to assess the respondent's application. 28 The only submission made by the appellants which remains to have any bearing on an assessment of the balance of convenience, and of the rights between the parties, is their submission that the claim for costs would require evidence, take time to determine and would incur further costs. No doubt the respondent has a similar concern about the appeal and that is precisely why it seeks to finalise costs at first instance. 29 The balance of convenience plainly lies in having all matters resolved before the matter comes before the Full Bench. The other issues raised by the respondent, and the fact that the appellant ignored them, only strengthen the reasons for refusing this application to stay. 30 The application to stay the proceedings before Justice Schmidt, currently listed for hearing on 13 December 2002, is refused. The costs of the stay are reserved. Submissions as to that matter should be incorporated in the parties' written submissions on the appeal. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.