Industrial Court of New South Wales CITATION: Simmons v South Western Sydney Area Health Service and ors (No 2) [2005] NSWIRComm 128 APPLICANT Giselle Simmons FIRST RESPONDENT South Western Sydney Area Health Service PARTIES: SECOND RESPONDENT Health Administration Corporation THIRD RESPONDENT New South Wales Health Department FILE NUMBER(S): 5499 of 2004 CORAM: Marks J CATCHWORDS: Unfair contract - interlocutory proceedings - application to amend summons - proposed amended summons failed to specify in summary the matters of fact which formed the basis of the application - held third respondent inappropriate entity as party to contract or arrangement - held rule 18A not complied with - motion to amend dismissed in part - application to amend against first respondent allowed - summons against second and third respondents struck out. Crown Proceedings Act 1988 s 3 Health Administration Act 1982 s 16(1) Health Services Act 1997 s 16 LEGISLATION CITED: Industrial Relations Act (Amendment) Act 2005 Industrial Relations Act 1996 ss 106 108B Industrial Relations Commission Rules 1996 r 18A CASES CITED: Simmons v South Western Sydney Area Health Services & Ors [2005] NSWIRComm 32 HEARING DATES: 08/30/2005 DATE OF JUDGMENT: 12/23/2005 APPLICANT Mr A Cheshire Solicitor: Ms R Tidswell McLaughlin & Riordan, Solicitors and Attorneys LEGAL REPRESENTATIVES: RESPONDENTS Mr M Kimber SC Solicitors: Ms J Healy Phillips Fox Lawyers JUDGMENT: - 9 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: MARKS J Friday 23 December 2005 Matter No IRC 5499 of 2004 GISELLE SIMMONS v SOUTH WESTERN SYDNEY AREA HEALTH SERVICE AND ORS (No 2) Application under s 106 of the Industrial Relations Act 1996 JUDGMENT ON FURTHER APPLICATION TO AMEND PROCEEDINGS [2005] NSWIRComm 128 1 In judgment delivered 3 June 2005 (Simmons v South Western Sydney Area Health Services [2005] NSWIRComm 32) I dealt with an application to amend the proceedings brought by the applicant during the course of hearing a strike-out application. 2 It is convenient to repeat paragraphs [1] to [6] of that earlier judgment, which were as follows: "[1] By summons filed on 13 September 2004 the applicant, Giselle Simmons, sought certain relief under s 106 of the Industrial Relations Act 1996 ("the Act") against three named respondents. They are, respectively, South Western Sydney Area Health Service (first respondent), Health Administration Corporation (second respondent) and New South Wales Health Department (third respondent). The summons sought orders directed to "the contracts or arrangements between the applicant and the respondents (hereafter called "the contract") whereby the applicant performed work for the respondents in the health care industry, and any contracts or arrangements collateral thereto" and asked that they be found to be unfair. Consequential orders were sought varying the contracts or arrangements and for the payment of compensation, costs and interest. [2] The summons, as is required by the rules of this Court, contained a summary of matters of fact and law upon which the applicant relied. There is, within the matters of fact recited in the summons, a history of the applicant's career as a registered nurse dating back to 1987. When read in conjunction with the material under the heading "matters of law" it is plain that there are allegations that the applicant's contract or arrangement with the respondents became unfair, harsh and unconscionable by reason of certain events which occurred whilst the applicant was working first at Fairfield Hospital and later at Liverpool Hospital. The matter proceeded on the basis that both those hospitals were within the first respondent's area. The summons asserted that the first respondent was "the actual employer" of the applicant, that the second respondent "is the corporate arm of the Department of Health in New South Wales and is, for the purposes of litigation, the employing body of the applicant", and that the third respondent "is the State Department of Health and was the ultimate employer of the applicant". [3] It was also common ground for the purpose of these interlocutory proceedings that the applicant last worked for a hospital within the South Western Sydney Area Health Service on 4 September 2003. On 20 August 2003 she signed a document entitled "notice of resignation" which gave two weeks notice of resignation from the applicant's "present position". The reason for resignation was given as "family". Under a sub-heading "entitlements on termination" the applicant indicated that she was transferring to the Illawarra Area Health Service and that she wished to transfer her annual leave, long service leave and sick leave entitlements. [4] The respondents sought, by notice of motion, to have the proceedings dismissed because they were commenced more than twelve months after the date of termination of the contract of employment which was the basis for the applicant's summons. In doing so the respondents relied on s 108B of the Act which is in the following terms: s 108B Time for making application (1) An application for an order under this Division in relation to a contract that has been terminated must be made not later than 12 months after the termination of the contract. (2) The Commission does not have jurisdiction to extend the time for making any such application or to accept an application made after the time prescribed by subsection (1). [5] The applicant resisted the notice of motion on three essential bases, being: 1. The applicant was not in fact an employee of the South Western Sydney Area Health Service but of either the Health Administration Corporation or the New South Wales Health Department, and her contract of employment had not come to an end but she had merely transferred positions and remained subject to the same contract of employment. 2. That in any event the applicant's claim was based on an arrangement between all of the respondents and that that arrangement persisted. 3. That this was not the appropriate time at which to consider the strike-out application, and that such consideration should only be given when all of the evidence was before the Court, presumably in the substantive hearing. All of these matters were fully argued. [6] During the final stages of argument the applicant sought an adjournment so that she could seek to amend the summons so as to avoid it being caught by s 108B. This interlocutory judgment deals with a notice of motion seeking to amend the summons subsequently filed, which was opposed by the respondents". 3 The applicant was refused leave to amend the summons because the form of summons did not comply with Rule 18A of the Rules of this Court. 4 By motion filed 24 June 2005 the applicant sought leave to further amend the summons in a manner which I shall shortly describe. The application was fully argued on 30 August 2005. At the conclusion of the hearing that day both parties were given leave to provide further written submissions with respect to a particular matter which had arisen during the course of argument. The applicant's submissions were filed on 26 September 2005. It appears that the respondent, the applicant on the notice of motion, had served submissions some few days earlier but had neglected to provide a copy to the Court. These were not filed until 7 December 2005 after receipt of an inquiry from my Associate. I refer to these matters as explanation for what otherwise might be seen to be an unseemly delay in dealing with the matter. 5 The proposed amended summons for relief elaborated on the identity of the named third respondent "New South Wales Health Department". As I pointed out in paragraph [15] of my earlier judgment, the proceedings had been considered on the basis that the third respondent was in effect the "New South Wales Health Service" described by s 16 of the Health Services Act 1997. The applicant has now made it clear in submissions that it is intended that the third respondent is in fact the Department of Health, established as a department of government by s 6(1) of the Health Administration Act 1982. It is clear from such references as are contained within the Health Services Act that the Department of Health is, in effect, an arm of government involved in overall matters of policy affecting health services in New South Wales. Indeed, as was submitted by the respondents, it will be inappropriate to name the third respondent as the Department of Health. By reason of s 3 of the Crown Proceedings Act 1988, the correct third respondent should have been named as "State of New South Wales". 6 The respondents submitted succinctly that as an arm of government "there is simply no foundation for suggesting that there was an arrangement between the applicant and the State of New South Wales whereby the applicant performed work in an industry". 7 The proposed summons as amended contains a number of matters seeking to justify the inclusion of the third respondent in the proceedings. It asserts that it "pays the applicant and issues policy determinations and directions on its letterhead and published with its authority to the first respondent, to and through the second respondent, and to the applicant, which relate to, amongst other things, the recruitment and selection of the applicant, incident reporting, bullying and harassment, mobility between the area health services and other public sector organisations, the determination of staff establishment requirements in hospitals and area health services, the formulation of entitlements in relation to …leave…and the application of merit and equity principles in employment". The assertion contained in the proposed summons is that when the applicant transferred from one hospital to another within an area health service, she did so pursuant to policies and procedures established by the third respondent, when she took leave she did so in accordance with the policies and directions of the third respondent and that overall the conditions of employment had "been determined by the second respondent and the policies and procedures under which she has worked have been determined and were enforceable by the third respondent". There is cited a number of circulars issued by the third respondent which were published through the second respondent to the first respondent which impacted upon the applicant's employment. These circulars covered a wide range of areas, including conditions of employment, managing parental leave, creating and grading of positions, public sector staff mobility, recruitment and selection, mandatory policy on bullying, harassment and discrimination, effective incident response, reporting of incidents and the like. 8 There is asserted in the proposed summons that representations were made to the applicant by way of the published policies of the third respondent concerning her terms and conditions of employment. 9 In written submissions, the applicant indicated that she would seek to further amend the proposed amended summons by adding two additional paragraphs. These are paragraphs [48A] and [48B], which are in the following terms: "[48A] In the premises, from about 1987 to 4 September 2003 the Applicant was employed or engaged by the First Respondent under an initial contract with variations to that contract or contracts collateral thereto over time whereby she performed work in the health care industry,. Insofar as these may not have been contracts, the Applicant contends that they were arrangements. From about 4 September 2003 to date, the Applicant has been employed or engaged by the First Respondent on a casual basis, thus varying the existing contract or contracts or creating a contract or contracts collateral thereto or a further contract or contracts. Insofar as these may not have been contracts, the Applicant contends that they were arrangements. Further or in the alternative, if and insofar as these may have been arrangements, the Applicant will contend that they were collateral to the contracts or arrangements set out in paragraph 48B. [48B] In the premises, from about 1983 to date, the Applicant has been employed or engaged by the Second and/or Third Respondents under an initial contract with variations to that contract or contracts collateral thereto over time whereby she performed work in the health care industry. Insofar as these may not have been contracts, the Applicant contends that they were arrangements. Further or in the alternative, if and insofar as these may have been arrangements, the Applicant will contend that they were collateral to the contracts or arrangements set out in paragraph 48A" 10 With respect to the third respondent, the applicant's allegations are directed in effect to the impact that certain formulations of policy made by the department of health had on her contract of employment with either the first or second respondent. As I have indicated, there was a reference to "representations" made by the third respondent in the context of circulars and other memoranda issued by it from time to time. In my earlier judgment, I referred at some length to what constituted an arrangement for the purpose of s 106 of the Industrial Relations Act 1996 ("the Act"). There is no suggestion that there was in existence a contract of employment between the applicant and the third respondent. Accordingly, in order to succeed against the third respondent the applicant needs to establish some arrangement pursuant to which she would perform work in the health industry to which she and the third respondent were parties, involving also the first and second respondents. I concluded in my earlier judgment that in order to seek to sustain such a case the applicant had to assert within the summons that there was some degree of understanding or mutuality of purpose shared between all of the parties to the arrangement. For there to be an arrangement and for there to be a factual basis for any arrangement there must be some indicia of discussion, negotiation, contact or understanding between representatives of each of the parties to the arrangement. No such assertion is contained within the proposed amended summons. At its highest, the assertion is that there was a body of pronouncements which regulated the employment of all persons within the New South Wales health service, including the applicant. However, the mere fact that there is an overarching code or aggregation of policies and memoranda is not of itself indicative of the existence of an arrangement. An example is provided by industrial awards established by industrial tribunals. Whilst these awards apply to and affect employment relations, it cannot be said that there is any degree of understanding made between the industrial tribunal and any individual employee. 11 The proposed amended summons and the current summons do not contain any material which would be indicative on a prima facie basis of any contract or arrangement between the applicant and the proposed third respondent, and therefore fails to comply with rule 18A of the Rules of this Court, the provisions of which I have discussed in my earlier judgment. 12 The proposed amended summons describes the second respondent as being "responsible for the terms and conditions of employment of the applicant, and other employees in the NSW health service; is taken to be the employer of the employees in the NSW health service for the purposes of any determination by a competent tribunal of those conditions and is for the purpose of any proceedings before a competent tribunal having power to deal with industrial matters, taken to be the employer of the employees in the NSW health service". 13 In the narration of the matters of fact and law which are summarised in the proposed amended summons, there is a reference to the applicant's conditions of employment having been determined by the second respondent and an allegation that the second respondent "failed in its duty to appropriately determine the conditions of employment to apply to the applicant's employment". Similar criticisms of the second respondent are made under the heading "Matters of Law" contained within the proposed amended summons, including references to the unfairness which this allegedly created. However, as I pointed out in paragraph [37] of the earlier judgment, "there is no assertion that there was any discussion, negotiation, contact or understanding with any person involving or representing the second respondent…". It therefore follows that there is no requisite mention of any matter of fact which touches upon the existence of any arrangement to which the applicant and the second respondent were a party. The same situation prevails in the current summons. 14 I conclude also that there is no matter of fact or law which touches upon the existence of any contract or arrangement to which the applicant, the first respondent, the second respondent and the third respondent were all parties. Nor was there said to be any relevant contract or arrangement between the applicant and any of the respondents save for the first respondent. There is also a failure to comply with rule 18A in this respect. 15 Even if I were incorrect in reaching these conclusions it would be necessary for the applicant to establish that any such contract or arrangement involving all or some of the respondents, apart from any contract between the applicant and the first respondent, was one whereby work was performed in an industry. Such a contract must directly lead to performance of work and must both "envisage the performance of work and have an impact upon the conditions of such performance" (per Spigelman CJ, New South Wales Court of Appeal in Solution 6 Holdings v Industrial Relations Commission of New South Wales and ors (2004) NSWCA 200 at [58], Mason P and Handley JA agreeing). 16 The conclusions which I have reached are sufficient to dispose of the proposed paragraph [48B] which I have earlier set out, because this is limited to contracts or arrangements between the applicant and the second and/or third respondents. Paragraph [48A] however, is confined to a contract or arrangement between the applicant and the first respondent. 17 Proposed paragraph [48A] asserts that the applicant has been employed or engaged by the first respondent on a casual basis from about 4 September 2003. This assertion was made in aid of the proposition that there was a contract or arrangement which continued after the applicant resigned. 18 In order to support this assertion the applicant relied on an affidavit sworn by her solicitor on 10 February 2005. That affidavit annexed, among other things, a copy of a clearance certificate from MacArthur Health Service, which appears to relate to the applicant, indicating a termination date of 4 September 2003. There is also a copy of a facsimile transmission within the MacArthur Health Service dated 5 September 2003 which appears also to relate to the applicant and which seems to convert "permanent employment" by the applicant to "casual". The affidavit asserts on instructions that at the time the applicant completed her notice of resignation form she was working in a permanent/part-time capacity at Camden Hospital. In or about May 2003 she made an application for inclusion in "the casual pool". From around 30 June to 4 September 2003 the applicant worked casual shifts at Campbelltown Hospital. She was appointed to a full-time position at Illawarra Health Service on 1 September 2003. The affidavit asserts that at that time it was the applicant's intention "to remain as a casual employee of the South Western Sydney Area Health Service in order to accept shifts as and when available and convenient…To the best of the applicant's recollection, she was contacted by telephone six or seven times by staff of the emergency department at Campbelltown and/or Camden Hospitals between September and approximately November 2003 requesting her to work. She was unable to avail herself of this opportunity due to commitments at Illawarra Health Service…The applicant has not received any letters of termination from the South Western Sydney Area Health Service…The applicant is willing and able to undertake casual shifts with the first respondent as her other working and living arrangements allow". 19 On the basis of this evidentiary material the applicant submitted that there was "a continuing relevant arrangement" between her and the first respondent "until the arrangement is terminated by either party". As I understand it, the arrangement was said to be one whereby the applicant was available to perform casual work if and when required by the first respondent if and when she was able to undertake that work. 20 It will be seen from the way in which the proposed paragraph [48A] has been drafted that there is reliance firstly on a contract or arrangement covering the casual work that might be performed by the applicant for the first respondent as and from 4 September 2003 and furthermore an allegation that this contract or arrangement constituted a variation of the initial contract of employment. In this way it is claimed, presumably, that s 108B would not operate because the original contract of employment continued to subsist, albeit in a varied form. 21 Of course, whether and to what extent the applicant may succeed in any such contention cannot be resolved until all of the appropriate evidence has been filed in the proceedings, at least that evidence which covers this issue. 22 There is well-established authority in this Court dealing with the basis upon which proceedings may be dismissed on jurisdictional grounds at an interlocutory stage. I refer in particular to Nagel, W D v Tilberg, J T & Tilburg C J [1993] NSWIRC 72 and Euphoric Pty Limited v Ryledar Pty Limited and Anor [2002] NSWIRComm 136 and the cases therein cited. The respondents' burden in this regard is a heavy one. As Kirby P (as his Honour then was) said in the New South Wales Court of Appeal in Majik Markets Pty Ltd v Brake Service Centre Drummoyne Pty Ltd (1991) 28 NSWLR 443 at 446, it has to be "plain that the invocation of the jurisdiction impugned is wholly misconceived, or, upon analysis, lacks an arguable legal foundation". 23 On the basis of the matters raised in the proposed paragraph [48A], I am unable to conclude that the invocation of the jurisdiction is wholly misconceived or lacks any arguable legal foundation. Of course, the applicant may be required to deal with an argument by the first respondent that the unfairness alleged in the summons relates to matters which occurred before 4 September 2003 and an argument that the contract as varied may not lead directly to performance of work, but these, it seems to me, are matters for the substantive hearing. 24 Accordingly, I am not persuaded that the applicant should not be permitted to amend the proceedings against the first respondent in the manner indicated in the proposed amended summons for relief which was the subject of these interlocutory proceedings, together with the inclusion of the proposed paragraph [48A]. 25 In all other respects, however, I would conclude that the invocation of the jurisdiction of this Court under s 106 against the second and third respondents lacks any arguable legal foundation on the basis of the matters of fact and law contained within the proposed amended summons for relief, including the proposed paragraph [48B] and in the matters of fact and law contained within the summons by which the proceedings are currently constituted. It must follow, therefore, that the applicant is not permitted to amend the summons in the manner sought against the second and third respondents and that the applicant's claim, brought against the second and third respondents as constituted by the summons currently before the Court should be dismissed. 26 After the motion was filed, s 108B of the Act was amended by the insertion of subsection (3), such amendment taking effect on 9 December 2005. Subsection (3) allows the Court to accept an application under s 106 within 3 months of the time otherwise proscribed by subsection (1) in certain circumstances. Both parties accepted that this amendment would not impact upon the determination of these proceedings, and I have proceeded accordingly. 27 The applicant asks that costs be reserved and I shall accede to this request. 28 ORDERS: 1. The applicant is granted leave to amend the summons against the first respondent in the manner set out in the proposed amended summons for relief, including the proposed paragraph [48A]; 2. The grant of leave to amend the summons against the second and third respondents in the manner set out in the proposed amended summons for relief, together with the inclusion of proposed paragraph [48B] is declined; 3. So much of the summons as is directed to the second and third respondents is dismissed; 4. Costs are reserved with liberty to apply; 5. The applicant is directed to file and serve an amended summons on or before 14 February 2006; 6. The parties are directed to file consent directions for the further progression of the proceedings with the Deputy Industrial Registrar on or prior to 14 February 2006, with liberty to apply. 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