Industrial Relations Commission of New South Wales CITATION : Hall v Nambucca Valley Delivery Service [2001] NSWIRComm 157 PARTIES : Anthony Eric Hall Nambucca Valley Delivery Service FILE NUMBER: IRC 6718 of 1999 CORAM: Harrison DP Unfair dismissal - request by respondent to be excused from proceedings - proceedings ex parte -allegations of theft - allegations of bankruptcy of respondent - application for costs by applicant CATCHWORDS : Held - allegations of theft not made out - no proof of bankruptcy - dissmisal harsh unreasonable and unjust - compensation ordered - costs allowed to applicant LEGISLATION CITED : Industrial Relations Act 1996 Bankruptcy Act 1966 CASES CITED : Deighton v Cockle [1912] 1 KB 206 HEARING DATES: 06/19/2001 DATE OF JUDGMENT: 07/12/2001 APPLICANT Ms L Hendy, Solicitor Garrett Walmsley Madgwick Solicitors LEGAL REPRESENTATIVES: RESPONDENT No appearance JUDGMENT: - 14 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: HARRISON DP Thursday, 12 July 2001 Matter No IRC 6718 of 1999 ANTHONY ERIC HALL AND NAMBUCCA VALLEY DELIVERY SERVICE Application re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION 1 The application in this matter was filed on 8 December 1999 and first subject to preliminary hearing before Mr Commissioner Cambridge on 4 April 2000. 2 The preliminary hearing was preceded by correspondence from Ms Marian Duthie, Nambucca Valley Delivery Service, sent by facsimile to Commissioner Cambridge's assistant at Xerox House, Sydney at 4.58 pm on 3 April 2000 advising that she would not be able to attend the preliminary hearing as she was "going into bankrupt" and inviting the Commissioner's Assistant to contact her at telephone numbers provided if any further information was required. An adjournment or deferral of the proceedings was declined and the matter proceeded at Wauchope Court House on 4 April 2000. 3 Mr A Hall, the applicant, appeared on his own behalf. Mr M English, solicitor of Priest McCarron Solicitors, appeared on behalf of the respondent employer. 4 In those proceedings the applicant sought compensation for unfair dismissal to the amount of $9,630.00, after tax, and asserted an underpayment of wages arising from overtime worked and not paid to the amount of $3,531.00. The applicant was informed by the Commission that jurisdiction did not exist to deal with the application for recovery of unpaid overtime within the instant proceedings. 5 The Commissioner attempted conciliation in the matter, was informed by Mr English that his instructions, as recent as the previous evening, were that the respondent had no money whatsoever to pay, and that the proceedings established a potential creditor in the person of Mr Hall and that voluntary liquidation was anticipated by his client. 6 The Commissioner was reluctant to set the matter down for hearing on that occasion as he expressed a view that such proceedings would be a futility in the event of the respondent entering into bankruptcy and put by way of recommendation to the applicant that he, or someone on his behalf, should correspond expeditiously with the respondent concerning the likelihood of appointment of an administrator; and in the event that occurred, engage the administrator in discourse concerning the claims. 7 The Commissioner recommended that the applicant seek appropriate advice and consider the utility of further proceedings given the submissions of Mr English in respect to the respondent's capacity. 8 It was further recommended that the applicant take action to formally establish his position as a potential creditor and make a request that he be informed and advised of appropriate financial developments. 9 The applicant sought an adjournment of four weeks to another preliminary hearing to determine whether the respondent went into bankruptcy. In the event, the Commissioner adjourned proceedings without fixing a date for further proceedings and issued directions, putting that the options appeared to be that the respondent trade itself into commercial viability, thus giving purpose to the instant proceedings; or the appointment of an administrator, the proceedings being stayed by the applicable legislation. 10 There was some discussion between the parties at these proceedings as to whether the respondent was a company and accordingly fell within the Corporations Act, or whether the respondent was a sole trader in which case the Bankruptcy Act 1966 ('the Bankruptcy Act) would apply. 11 The directions issued included a requirement that Mr English inform his client that the Commission required specific advice from the respondent, its representative or administrator, if appointed, setting out the financial position of the respondent within 28 days of the proceedings of 4 April 2000 with a copy of that correspondence to the applicant. 12 The Commissioner determined that, should the financial report received in accordance with these directions reveal that the respondent remained operational and that the applicant required further proceedings, he would relist the matter on request. 13 Mr English confirmed that on his limited instructions he understood that the respondent was currently organising documents to file for voluntary bankruptcy and that the result should be known within the next two weeks, thus the 28 day time frame was appropriate. 14 There was no report furnished to the Commission. The matter was listed for further proceedings before Cambridge C on 5 September 2000. 15 Mr A Saunders, Solicitor of Garrett Walmsley Madgwick Lawyers (GWM), appeared on behalf of the applicant, whom Mr Saunders put was unable to attend as he had found other employment, but was available to Mr Saunders by telephone for the purpose of instructions. There was no appearance by or on behalf of the respondent. 16 The Commissioner caused enquiries to be made resulting in his Assistant speaking directly to Ms Duthie who offered her apologies on the basis that she was of the view that the matter had been listed in the next week. This is confirmed by Ms Duthie in a handwritten facsimile to the Assistant dated 5 September 2000 at 9.13 am in which she states: "I apologise with my confusion with the dates, I am will to travel to Sydney at the next available date if this is helpful." (signed Marian Duthie) 17 The transcript of proceedings of 5 September 2000 records a description of efforts by the Commissioner's staff to obtain the financial report subject to directions in earlier proceedings, which, the transcript records, elicited a promise from Ms Duthie to comply, but no report. 18 Mr Saunders sought directions to bring the matter to hearing, stating a preference that the matter be heard in the Port Macquarie region, even if that meant a delay. The matter was then listed for hearing on 26 and 27 March 2001, commencing at 2.00 pm on 26 March and continuing on 27 March as required. 19 Directions were issued, having regard to the then impending Olympic Games program, that the applicant file and serve witness statements and documentary evidence to be relied upon by close of business on Friday, 6 October 2000, with a requirement that the witness statements be in affidavit form. The respondent was directed to file and serve in similar terms by close of business on Friday, 3 November 2000. The applicant was afforded a further two weeks to close of business on Friday, 17 November 2000 to put any affidavit material in reply. 20 The matter was listed for further mention in Wauchope on 28 November 2000 at 2.00 pm, by which time the Commissioner required an undertaking pursuant to s90 of the Industrial Relations Act 1996 ('the Act') to be completed in appropriate form. The Commissioner further noted that the application was out of time by six days, informing the parties of the need for evidence to support an exercise of discretion to extend the time. 21 A notice of appearance was filed by Ms Loris Hendy, Solicitor (GWM) on behalf of the applicant on 7 September 2000. 22 The matter was subject to further proceedings in Wauchope on 28 November 2000 as scheduled by the Commissioner. 23 Ms Hendy appeared for the applicant. Mr English appeared for the respondent. 24 Mr English informed the Commission that he had received some documents in the matter and been accidentally informed of proceedings though had no contact with the respondent since the first proceedings on 4 April 2000, despite attempts by him to contact Ms Duthie. Mr English put that the documents he received were delivered to his office on the morning of 28 November 2000 by an unknown courier who had initially delivered them to another firm of solicitors. The documents were revealed to be affidavits in response to the affidavits filed by the applicant and were in an envelope marked " to be collected by the respondent Marian Duthie". 25 Mr English made application to withdraw from proceedings and was instructed that he should file the appropriate notice of ceasing to act, which was not opposed by Ms Hendy. A notice of ceasing to act was duly filed in the Industrial Registry on 1 December 2000. 26 The undertaking required pursuant to s90 of the Act was placed on the file. Ms Hendy put that she had two further affidavits to serve upon the respondent which she conceded were outside the directions issued, putting that the need for the additional affidavits had emerged fairly recently. The Commissioner expressed his concern at the inappropriate response of the respondent and the mounting costs for the applicant, directing that a comprehensive collection of material to be relied upon by the applicant be served on the respondent by registered post in order that the proceedings might properly be focused and to ensure the respondent had indeed received a complet set of relevant documents. 27 The Commissioner then issued amended directions that the applicant file and serve all witness statements and all documentary material no later than Friday, 15 December 2000; that a composite set of all witness statements and documentary materials be served by registered post or process server by that date; that the respondent file and serve all witness statements and documentary material no later than close of business on Friday, 2 February 2001; and that the applicant file any material in reply by Friday 16 February 2001. 28 The applicant was directed to convey these directions to the respondent by covering letter with the material to be served by 15 December 2000. 29 The matter was next before the Commissioner on Tuesday, 20 February 2001 as scheduled for further directions. Mr Franey, solicitor (GMW) appeared on behalf of the applicant. There was no appearance by the respondent. 30 Mr Franey sought leave to file an affidavit of service sworn by Ms Beverley Klingbiel on 18 December 2000, going to the service of documents upon the respondent, and an affidavit sworn by Mr Sheridan Koning on 19 February 2001 in respect to service of various documents in accordance with previous directions. Leave was allowed and the affidavits admitted and marked exhibits 1 and 2 respectively. 31 The matter remained scheduled for arbitration on 26 and 27 March 2001, Mr Franey undertaking to further inform the respondent by registered post of confirmation of proceedings. Mr Franey put that he was instructed to seeks costs in the matter, which was deferred subsequent to hearing of the substantive issues. 32 The matter was reallocated to the Commission as presently constituted on 13 March 2001 and subject to mention in Port Macquarie on 19 March 2001. 33 Ms Hendy appeared on behalf of the applicant. Ms Marian Duthie appeared on her own behalf. 34 Ms Hendy noted that all affidavits were in, with the exception of one affidavit which she sought to file in reply which had been delayed due to the late filing of Ms Duthie's evidence. 35 In the event, I was not able to hold the dates of 26 and 27 March 2001 in my list and alternatively 23 April 2001 was proposed. Given the history of proceedings and the fact that the occasion of 19 March 2001 appeared to be the first point at which the applicant's representative and the respondent had direct contact, a further attempt at conciliation was explored in accordance with the requirements of s86 of the Act. 36 In particular, the proposition was put to the parties as to whether compromise was available. 37 Ms Duthie put that she had dismissed Mr Hall from employment but that she had not considered compromise as she had not thought of it, putting that she should. A short adjournment was allowed with an offer to the parties that the Commission was available to assist then in private conference at their mutual request. No such request was made. On return to formal proceedings Ms Hendy reported that some discussion had passed between the parties and both were amenable to the notion of compromise if possible. Ms Hendy put that resolution by compromise was not possible at the present time as Ms Duthie had expressed a need to verify wage rates and records. Ms Hendy put that the parties had resolved to continue their discussions on the basis that the matter be set down for hearing in Port Macquarie on 19 June 2001 with a mention of proceedings on 23 April 01 in Port Macquarie to ascertain the progress in conciliation. 38 The matter was deferred by agreement between the parties to 2.00 pm on 23 April 2001 in Port Macquarie. On that occasion Ms Hendy appeared with and on behalf of the applicant. There was no appearance by the respondent. 39 Enquiries were made of Ms Duthie who was at the time of proceedings at her business premises in Coffs Harbour. The transcript records Ms Duthie's apology for her non attendance, having misunderstood or misconceived her obligation to the proceedings. The advice from Ms Duthie was that she had put an offer to Ms Hendy and heard no response. 40 Ms Hendy put that this was not the case and that no offer had been received. 41 The proceedings were suspended to allow Ms Hendy to speak by telephone to Ms Duthie. Ms Hendy subsequently reported that Ms Duthie had told her that she had not received correspondence setting out an offer of settlement and that in any event Ms Duthie's position was to offer an amount of one week's pay in settlement of the matter. Ms Hendy submitted that conciliation was not available on those terms. The matter was then adjourned to hearing as scheduled from 10.30am on 19 June 2001 in Port Macquarie. A formal advice was issued by the Industrial Registry to the parties to confirm those proceedings. 42 On 19 June 2001 Ms Hendy appeared with and on behalf of the applicant. There was no appearance by or on behalf of the respondent. 43 Ms Hendy submitted that Ms Duthie, operating Nambucca Valley Delivery Service as a sole trader, had entered voluntary bankruptcy pursuant to the Bankruptcy Act on 16 May 2001. Ms Hendy noted that a search had revealed that Nambucca Valley Delivery Service was not a registered business name. 44 Ms Hendy submitted that the matter was not prohibited from conclusion by s58(3) of the Bankruptcy Act as determination of the mattter was not, in Ms Hendy's submission, "taking a fresh step in proceedings" within the meaning of s58(3) the Bankruptcy Act, which states: Except as provided by this Act, after a debtor has become a bankrupt, it is not competent for a creditor: (a) to enforce any remedy against the person or the property of the bankrupt in respect of a provable debt; or (b) except with the leave of the Court and on such terms as the Court thinks fit, to commence any legal proceeding in respect of a provable debt or take any fresh step in such a proceeding. 45 Ms Hendy also sought an order for costs in the matter pursuant to s181(2) of the Act. Ms Hendy was directed to file written submissions in respect to both matters and, in particular, detail costs sought in the proceedings. 46 Written submissions were received in accordance with the directions in support of her initial submission that the matter was not estopped by the Bankruptcy Act; Ms Hendy put that the matter was set for hearing prior to the respondent entering voluntary bankruptcy. Ms Hendy put that there was no appearance by the respondent at the scheduled hearing and there is therefore nothing further that needs to be done by the applicant before judgment is given. Ms Hendy relied upon the judgment of Kennedy L J in Deighton v Cockle ([1912] 1 KB 206). 47 The costs in the matter are particularised at $6,367.01; being separated into fees rendered prior to 1 July 2000 of $230.00, fees rendered after 1 July 2000 of $5,428.00, and GST at 10% being $542.80, plus disbursements of $166.21. 48 I accept the submissions of Ms Hendy that the matter is not precluded to conclusion by the Bankruptcy Act and having regard to the conduct of the respondent in the proceedings the matter should be determined on the affidavit material filed. SUBSTANCE 49 The affidavit material filed by the applicant and the respondent is at odds on only one issue; that being whether the applicant was given permission to take a broken table from the Port Macquarie depot operated by Ms Duthie or whether he took the table without approval. 50 The facts as asserted in the affidavit of Ms Duthie earlier filed reveal the applicant commenced employment on 26 July 1999 pursuant to the Transport Industry (State) Award (315 IG 192) ('the Award'). The applicant was responsible for pick up and deliveries in the Sydney region which required him to load and unload his truck. The applicant averaged three trips a week to Sydney , being Monday, Wednesday and Friday. 51 Ms Duthie deposed that the applicant was dismissed from her employment for taking a table which had been broken several trips previously. Ms Duthie deposed that the applicant had never asked for the table, just assumed he could have it. Ms Duthie asserts that this was not the first occasion that the applicant was involved in taking things from the depot that did not belong to him. Ms Duthie relies on a statement from Mr Wallis filed in proceedings detailing some items said to belong to Mr Wallis said to be found in the applicant's possession, identified as a radio and CB aerials. In her affidavit Ms Duthie details further complaints concerning the applicant in terms of work performance and conduct. 52 Ms Duthie's affidavit concludes at point 7 thereto with the following statement: I am still experiencing severe financial difficulties and seek permission not to attend the tribunal hearings." 53 The affidavit filed by the applicant denies the allegation that he took the table without discussing the matter with Ms Duthie and refutes the assertion that he took anything other than with permission, and rejects the criticism of his work performance and conduct. 54 The applicant deposed that the work required of him by Ms Duthie was demanding in terms of time requirements and physically arduous, which he undertook to the best of his endeavours and completed satisfactorily. The applicant is supported in this contention by an affidavit filed by Mr Mark Grierson who states that in early October 1999 he was assisting the applicant to unload a truck in Port Macquarie and heard a conversation between the applicant and Ms Duthie concerning a broken table in which the applicant asked Ms Duthie "Can I have it", to which she was said to respond, "Yes, its stuffed anyway." 55 The applicant's position is further supported by an affidavit filed by Mr Michael Lynch, an employee of Ms Duthie engaged to manage the Port Macquarie depot. The affidavits, accepted by Cambridge C from Ms Klingbiel and Ms Koning (exhibits 1 and 2), detail service of document upon Ms Duthie and her receipt of them. CONCLUSION 56 Relying primarily on the evidence of Ms Duthie, the inescapable conclusion is that her repeated requests to be excused from proceedings must be taken as a desire that the matter be determined ex parte. 57 The restraint upon proceedings pursuant to the Bankruptcy Act is problematical. 58 There is no evidence or information before this Commission that Ms Duthie has in fact entered into bankruptcy and that the Bankruptcy Act applies. I have ascertained from the bar table from Ms Hendy that she has been informed of Ms Duthie's bankruptcy. This is not an acceptable standard of proof, particularly when taken against the earlier unfulfilled contentions of Ms Duthie that her bankruptcy was imminent but did not occur. 59 Ms Duthie was aware of these proceedings and would have on her an obligation to inform either the Commission of her bankruptcy, thus invoking any stay that may apply pursuant to the Bankruptcy Act; or to inform any administrator appointed who would then assume the responsibility of informing the Commission. No such action has been taken. 60 It does not fall to me to determine whether there is a restraint pursuant to the Bankruptcy Act or not; nor does it fall to me to determine whether conclusion of these proceedings is or is not a fresh step pursuant to s58(3) of the Bankruptcy Act. 61 I proceed to determine the matter on the information before me. 62 In consideration of the substance of the matter there is sufficient material to support the conclusion that the applicant took the table in question with the explicit approval of Ms Duthie Even if this were not true, there is clearly a tacit approval and, at worst, a misunderstanding. 63 There is nothing in the evidence which discloses any attempt by Ms Duthie to allow the applicant to provide an explanation for his conduct, no request for return of the item subject to the misunderstanding; nor any procedure for the disposal of damaged or unwanted goods. 64 The conduct of the applicant fails to satisfy the provision of s84 of the Act on all grounds. Section 84 requires: 84 Application for remedy by dismissed employee (1) If an employer dismisses an employee and the employee claims that the dismissal is harsh, unreasonable or unjust, the employee may apply to the Commission for the claim to be dealt with under this Part. (2) An application may be made on behalf of the employee by an industrial organisation of employees. (3) An industrial organisation may make one application on behalf of a number of employees who were dismissed at the same time or for related reasons. However, this subsection does not prevent the Commission from hearing a number of applications under this Part together or individually. (4) An application may be made under this Part even though the applicant does not specify the nature of the remedy sought or requests compensation only. However, this subsection does not affect the requirement under this Part that compensation is available only if the Commission considers that reinstatement or re-employment would be impracticable. 65 I find the termination of the applicant's employment harsh, unreasonable and unjust. I determine that reinstatement or re-employment are not practical and award compensation which I assess at $6,000.00 (six thousand dollars). COSTS 66 Costs are available in proceedings pursuant to s84 of the Act where a party has acted unreasonably in the conciliation process. 67 I am compelled to the conclusion that the respondent has deliberately and mischievously sought to delay, divert, and obfuscate proceedings. The conduct of the respondent detailed earlier in this decision supports an order of costs against her. 68 Costs are allowed in full to the amount of $6,367.01. 69 Matter No IRC 6718 of 1999 is so concluded. oo0oo INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: HARRISON DP Thursday, 12 July 2001 Matter No IRC 6718 of 1999 ANTHONY ERIC HALL AND NAMBUCCA VALLEY DELIVERY SERVICE Application re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 ORDERS 1. Pursuant to s89(5) of the Industrial Relations Act 1996 the Commission orders Ms Marian Duthie to pay Mr Anthony Eric Hall the amount of $6000.00 (six thousand dollars) within 21 days of this decision. 2. Pursuant to s181 of the Industrial Relations Act 1996 the Commission orders Ms Marian Duthie to pay the amount of $6,367.10 (six thousand three hundred and sixty seven dollars and ten cents) as costs in these proceedings to Mr Anthony Eric Hall within 21 days of this decision. I so order. R W HARRISON Deputy President 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.