Industrial Court New South Wales Medium Neutral Citation: Rail Corporation of New South Wales v David Elleray [2015] NSWIC 6 Hearing dates: 18 February 2015 and 26 March 2015 Date of orders: 21 May 2015 Decision date: 21 May 2015 Before: Kite AJ Decision: I order that this matter be referred to the Industrial Registrar for the commencement of proceedings under section 180 of the Industrial Relations Act 1996 (NSW) for punishment of the respondent's contempt of the Commission. Catchwords: CONTEMPT – failure to comply with order of Industrial Court - standing of party to commence prosecution – jurisdiction to direct Industrial Registrar to commence prosecution – test to be applied for such direction; PROCEDURE – absence of rule not determinative – power to make appropriate direction Legislation Cited: Courts and Crimes Legislation Further Amended Act 2008 Criminal Procedure Act 1986 Industrial Relations Act 1996 Industrial Relations Amendment (Industrial Court) Act 2013 Industrial Relations Commission Rules 2005 Industrial Relations Commission Rules 1996 (superseded) Supreme Court Rules 1970 Uniform Civil Procedure Rules 2005 Cases Cited: Crewdson v Director-General NSW Department of Community Services (No 2) [2006] NSWIRComm 336 Elleray and Rail Corporation of New South Wales [2013] NSWTAB 3 Elleray v Rail Corporation of New South Wales [2013] NSWTAB 7. Rail Corporation of New South Wales v Elleray [2013] NSWIRComm 86. Elleray v Rail Corporation of New South Wales [2014] NSWIRComm 45 Uniting Church in Australia Property Trust (NSW) v Industrial Relations Commission (NSW) (2004) 60 NSWLR 602 Wyszenko v Wyszenko [2012] NSWSC 732 Category: Principal judgment Parties: Rail Corporation of New South Wales (Applicant) David John Elleray (Respondent) Representation: Counsel: N L Sharp of counsel (Applicant) Solicitors: Marque Lawyers (Applicant) John Stonham & Co Lawyers (Respondent) File Number(s): IRC 177 of 2014 Judgment 1. This is an application for orders in connection with an alleged contempt of the Industrial Relations Commission of New South Wales ("the Commission"). Rail Corporation of New South Wales ("applicant") alleged that Mr David Elleray ("respondent") had failed to comply with orders made by the Commission. Factual Background Procedural History 1. The respondent was dismissed from his employment with the applicant on 9 July 2012. He made an appeal to the Transport Appeals Board ("the TAB") against that decision. His appeal was successful. By order of the TAB (constituted by Commissioner Tabbaa) he was to be reinstated: see Elleray and Rail Corporation of New South Wales [2013] NSWTAB 3. 2. The applicant appealed to the Industrial Court and sought a stay of the reinstatement order pending determination of the appeal. Orders were made and subsequently varied, in each case by consent, staying the reinstatement order pending the outcome of the appeal. 3. The relevant terms of the orders were as follows: 1. The orders of Commissioner Tabbaa of the Transport Appeal Board in matter TAB 255 of 2013 reported as David John Elleray and Rail Corporation of New South Wales ("RailCorp") [2013] NSWTAB 3 dated 7 May 2013, be stayed until further order of the Court, pending the outcome of this Appeal. 2. Within 7 days from the date of these orders, the Appellant will make a payment to the Respondent representing the wages that he would have received from the Appellant had the Appellant reinstated the Respondent to his former position effective from the start of the next shift roster following 7 May 2013, calculated on a base rate of pay of $2,285.10 gross per fortnight (less applicable taxes). 3. Thereafter, until further order of the Court, the Appellant will pay to the Respondent, in the ordinary pay cycle and into the bank account into which his wages were ordinarily paid, the amount that the Respondent would have received from the Appellant had the Appellant reinstated the Respondent to his former position, calculated on a base rate of pay of $2,285.10 gross per fortnight (less applicable taxes). 4. If the Respondent generates income from the performance of work during the period related to orders 2 or 3 of these orders: 1. the Respondent must disclose to the Appellant, on a fortnightly basis, the quantum of any amounts received by the Respondent for the performance of work; and 2. the Appellant is entitled to reduce amounts otherwise payable to the Respondent pursuant to orders 2 or 3 of these orders by the amounts that the Respondent has received from the performance of work. 1. In the event that the Appellant is ultimately unsuccessful in the Appeal, the Appellant will: 1. pay to the Respondent's nominated superannuation fund the minimum superannuation contributions that would have otherwise been payable under superannuation guarantee legislation had the Appellant reinstated the Respondent to his former position effective from the start of the next shift roster following 7 May 2013; and 2. the Appellant will credit the Respondent with the amount of annual leave that would have otherwise been accrued by the Respondent had the Appellant reinstated the Respondent to his former position effective from the start of the next shift roster following 7 May 2013. 1. In the event that the Appellant is ultimately successful in the Appeal, the Respondent is required to pay back to the Appellant all amounts paid by the Appellant to the Respondent pursuant to orders 2 or 3 of these orders under a monthly repayment plan of $1,000 per month. Order 3 subsequently was amended by consent to make provision for payment into a different bank account. 1. The appeal to the Full Bench of the Industrial Court was successful: Rail Corporation of New South Wales v Elleray [2013] NSWIRComm 86. The Full Bench directed the matter be remitted to the TAB to be determined according to law. The decision was dated 30 September 2013. 2. The TAB (constituted by Commissioner Newall) disallowed the appeal: Elleray v Rail Corporation of New South Wales [2013] NSWTAB 7. The decision was dated 16 December 2013. 3. The respondent appealed the decision to the Industrial Court (constituted by Justice Walton, President). I note that following the passage of the Industrial Relations Amendment (Industrial Court) Act 2013 ("IR (IC) Act') such appeals could be heard by a single member. His Honour dismissed the appeal: Elleray and Rail Corporation of New South Wales [2014] NSWIRComm 45. The decision was dated 28 August 2014. Payments Made 1. In the period between the making of the orders and the determination of the application by Newall C the applicant made payments totalling $25,095.42. 2. Following the Commissioner's decision, the applicant's solicitors wrote to the respondent's solicitors requiring repayment in accordance with Order 6. A particular bank account was nominated into which the payments could be made. There was no direct response to this correspondence and no repayments were made at that time. Instead on 3 January 2014 the respondent initiated his appeal to the Industrial Court. No stay was sought. 3. Further correspondence seeking repayment was sent by the applicant's solicitors. The letters were dated 7, 22 and 29 January 2014. On 30 January 2014 the respondent's solicitor replied. Relevantly the letter provided: "we are instructed that our client is in the process of attempting to raise the funds necessary to commence making repayment to your client in accordance with the orders of His Honour Justice Walton, Vice President made on 19 June 2013. … … we respectfully request your client defer from relisting the matter or taking adverse steps to our clients [sic] interests for a further period of twenty-eight (28) days pending our client's efforts to obtain employment." 1. On 11 March 2014 the applicant initiated these proceedings for contempt. No repayments had been made up to that time. 2. In response to the motion initiated by the applicant the respondent filed an affidavit in which he deposed that he had commenced making payments and that he intended to continue making payments at the rate of at least $250 per week until the monies owed were repaid in full. 3. In light of this development the applicant agreed to adjourn the contempt application. Consent orders were made by the Court adjourning the proceedings until 18 June 2014. Further consent orders were made by the Court adjourning the proceedings until 26 August 2014. 4. Between April and August 2014 the respondent made repayments totalling $5,250.00. 5. On 25 August 2014 consent orders were made by the Court adjourning the proceedings until 3 November 2014. The respondent then ceased to make repayments after August 2014. 6. The applicant sought to relist the contempt proceedings. The Court made directions requiring an amended application to take account of the repayments made and for the filing of evidence by the respondent. 7. Although later than directed, the respondent filed and served an affidavit in relation to the application. 8. At the hearing of the matter on 18 February 2015 the applicant sought leave to further amend its application. The respondent neither consented to nor opposed either the grant of leave to file in court or to amend. The draft further Amended Application had been served on the respondent on 13 February 2015. In view of the nature of the amendment and the attitude of the respondent, leave was granted. It will be necessary to return to the terms of the amendment in due course. The Evidence at Hearing 1. The applicant read: 1. An affidavit of Amber Leigh Sharp filed 11 March 2014; and 2. An affidavit of Lawrence Brunello filed 19 December 2014. 1. Ms Sharp deposed as to the history of the course of proceedings (which I have already recounted), the orders and the attempts made by the applicant to seek repayment. Mr Brunello deposed as to the repayments made between April and August 2014. Neither witness was required for cross-examination. 2. The applicant also tendered, without objection, correspondence from its solicitors dated 24 April 2014, attaching another letter dated 16 April 2014 also from its solicitors, seeking the adjournment by consent of the contempt proceedings referred to in [14] above. 3. The respondent read two affidavits of Mr Elleray. The first filed on 11 April 2014 and the second by leave filed in court on 18 February 2015. There were no objections to the affidavits but Mr Elleray was required for cross-examination. 4. In view of a submission made by the respondent it is necessary to recount in some detail Mr Elleray's evidence. 5. In his first affidavit the respondent deposed to giving instructions to consent to the orders now sought to be enforced. He said that at the time of giving these instructions he intended to comply with the orders. 6. Mr Elleray deposed that he had not been in receipt of any income between March 2013 and the determination of Newall C in December 2013, other than the payments made to him by the applicant. He began to seek employment from about February 2014. The respondent said he was prevented from seeking employment during January 2014 because he was required to care for his brother and he and his brother needed to visit their father who was ill. After that he took his mother on a brief trip. 7. He secured some casual employment from about 10 March until 24 March 2014. He had at the time of swearing that affidavit an intention to undertake a short course to qualify him to work in mining. 8. The respondent also deposed to the break-up of his relationship with his long term partner. The break-up led to him (and her) vacating their home which he owned. He said he was unable to let the property because his former partner had left many of her belongings behind. 9. As a result of the break-up of the relationship the respondent was left with "numerous debts". He was able to pay these debts and his mortgage because his mother loaned him $8,000 and he sold his motorbike for $5,000. His mother had continued to assist with the mortgage repayments. 10. Mr Elleray said that in about February 2014, he informally approached his bank seeking to refinance his property to raise funds to repay the applicant. However, it was indicated that such an application would not be successful. 11. The respondent deposed to having made payments between March and April 2014 of $250 to $300 per week and that he intended to continue to do so. He indicated that, at that time, he was receiving $1100 per month rent for his property. 12. In his second affidavit he deposed to having made further payments since his first affidavit at the rate of $250 per week until 15 August 2014. He said he was unable to continue making payments after that date because: I was unemployed, engaged in family law property proceedings with my former de facto partner, Ms Vanessa McGrath, and was reliant on financial support from members of my family, including my mother, Wendy to make payments 1. Mr Elleray said that all rents received were applied to loan repayments which were $3500 in arrears at that point. He said he'd not been employed since March 2014 and that he was unable to seek employment because of his father's illness and subsequent death and the need to care for his brother and mother. The need to care for his father on an irregular basis had prevented him from committing to any regular employment. His father's suicide in December 2014 had left him shattered. He was also not coping well following the death of a long-time friend in late January 2015. 2. Mr Elleray deposed to now being able to make repayments of $100 per week commencing immediately upon acceptance of that offer. He denied it was ever his intention "to intentionally be in contempt" or renege on orders of the Commission. 3. Under cross-examination the respondent: 1. Accepted that he had an obligation pursuant to the orders to repay the applicant; 2. acknowledged that he was the sole registered proprietor of the property at 59 Farnsworth Street, Campbelltown (the property); 3. assumed that the property had a value between $350,000 and $400,000 but had not done a valuation; 4. acknowledged that he has a mortgage to Westpac in respect of the property of approximately $150,000; 5. said the property is rented out at a current weekly rent of $300; 6. stated and restated that it had not crossed his mind to sell the property; 7. stated that he had $80,000 in joint accounts (with his former partner) in superannuation; 8. agreed that when he ceased to make payments to the applicant he made no attempt to negotiate a revised schedule and made no representations to it concerning his incapacity to pay; 9. agreed that he always had the capacity to pay $100 per week but regarded his estimate of $250 per week as too much; and 10. said that his mother was his brother's primary carer but she was assisted by other carers under a government assistance package (in respect of which his mother knows the details) but he also assists with caring for his brother. The Further Amended Application 1. The applicant originally sought an order to the effect that the respondent was guilty of contempt of the Commission. For reasons which will become apparent it sought to amend the application to add an additional order in the following terms: 1A. an order that the matter be referred to the Industrial Registrar for consideration for the commencement of proceedings under section 180 of the Industrial Relations Act 1996 (NSW) for punishment of the respondent's contempt of the Commission 1. Notwithstanding that the effect of the amendment was to seek the additional order as one of two alternatives, counsel for the applicant advised that, if the amendment were permitted, the respondent would move only for that order. In short, counsel submitted that there was an issue as to the standing of the applicant to initiate a prosecution for contempt. Following the grant of leave to amend the applicant followed that course. The Legislative Framework 1. In order to resolve issues as to the jurisdiction and power of the Commission to make the order sought, it is necessary to traverse a number of legislative provisions. It is convenient to set them out. 2. Sections 151A, 153 and 162 of the Industrial Relations Act 1996 (IR Act) provide: 151A Name of Commission in Court Session to be the Industrial Court of New South Wales The name of the Commission in Court Session is to be the Industrial Court of New South Wales, and a reference in this Act (or any other Act, statutory instrument or document) to the Commission in Court Session (whether enacted or made before or after the commencement of this section) is taken to include a reference to the Industrial Court of New South Wales. … 153 Jurisdiction of Commission in Court Session (1) The following functions of the Commission are to be exercised only by the Commission in Court Session: (a) proceedings for an offence taken before the Commission (including proceedings for contempt), … 162 Procedure generally (1) The Commission may, subject to this Act, determine its own procedure. (2) The Commission: (a) is to act as quickly as is practicable, and (b) is to conduct its proceedings publicly or, if it considers it necessary, privately, and (c) may require the presentation of the respective cases of the parties before it to be limited to the periods of time that it determines are reasonably necessary for the fair and adequate presentation of the cases, and (d) may require evidence or argument to be presented in writing and decide on the matters on which it will hear oral evidence or argument, and (e) may sit at any place, and (f) may require a document to be served outside the State, and g) may adjourn proceedings to any time and place (including for the purpose of enabling the parties to negotiate a settlement), and (h) may dismiss at any stage any proceedings before it if it considers the proceedings are frivolous or vexatious, and (i) may exercise, on its own initiative, any function exercisable by it on application (except when it is in Court Session), and (j) may, on its own initiative, inquire into any industrial matter. 1. Sections 164 and 180 of the IR Act deal with contempt of the Commission. They relevantly provide: 164 Powers of Commission as to the production of evidence, perjury and contempt … (2) The Commission in Court Session may exercise the functions of the Supreme Court in relation to the apprehension, detention and punishment of persons guilty of contempt of the Commission (including disobedience of any order made by or process issuing out of the Commission). … 180 Contempt of Commission—offence (1) A person in contempt of the Commission is guilty of an offence. Maximum penalty: 500 penalty units in the case of a corporation or, in any other case, 50 penalty units or imprisonment for 6 months, or both. (2) For the purposes of subsection (1), conduct is a contempt only if the same conduct in relation to the Supreme Court would be a contempt of the Supreme Court. (3) Proceedings for an offence against this section may be taken only before the Commission in Court Session. 1. Sections 397, 398 and 399 of the IR Act provide: 397 Summary procedure for offences under this Act or regulations (1) Proceedings for an offence against this Act or the regulations are to be dealt with summarily: (a) before the Local Court, or (b) before the Commission in Court Session. … (3) The maximum penalty that may be imposed in those proceedings by the Commission in Court Session is the maximum penalty provided in respect of the offence. 398 Time for instituting proceedings (1) Proceedings for an offence against this Act or the regulations (other than an offence under section 180 or an offence referred to in subsection (2)) may be commenced not later than 12 months after the offence was alleged to have been committed. Note. Proceedings for an offence under section 180 must be commenced not later than 6 months after the offence was alleged to have been committed (see section 179 of the Criminal Procedure Act 1986). … 399 Authority to prosecute (1) Proceedings for an offence against this Act or the regulations may be instituted only: (a) by the Minister or by a person with the written consent of the Minister, or (b) by an inspector, or (c) by a person, or a person of a class, prescribed by the regulations. (2) In any such proceedings, a consent to institute the proceedings, purporting to have been signed by a person authorised to give a consent under this section is evidence of that consent without proof of the signature or authority of the person. (3) Any such proceedings instituted by an officer of a Government Department may be prosecuted on his or her behalf by any officer of that Department. (4) This section does not limit any function that may be exercised by the Commission under section 164 (2) with respect to any contempt of the Commission. 1. The relevant provisions of the Criminal Procedure Act 1986 provide: 3 Definitions … indictable offence means an offence (including a common law offence) that may be prosecuted on indictment. … summary offence means an offence that is not an indictable offence. … 5 Certain offences to be dealt with on indictment (1) An offence must be dealt with on indictment unless it is an offence that under this or any other Act is permitted or required to be dealt with summarily. (2) An offence may be dealt with on indictment if it is an offence that under this or any other Act is permitted to be dealt with summarily or on indictment. 6 Certain offences to be dealt with summarily (1) The following offences must be dealt with summarily: (a) an offence that under this or any other Act is required to be dealt with summarily, (b) an offence that under this or any other Act is described as a summary offence, (c) an offence for which the maximum penalty that may be imposed is not, and does not include, imprisonment for more than 2 years, excluding the following offences: (i) an offence that under any other Act is required or permitted to be dealt with on indictment, (ii) an offence listed in Table 1 or 2 to Schedule 1. (2) An offence may be dealt with summarily if it is an offence that under this or any other Act is permitted to be dealt with summarily or on indictment. 1. Sections 153 and 164 were amended by the IR (IC) Act. Section 398 was amended by the Courts and Crimes Legislation Further Amended Act 2008. It is convenient also to the set out these provisions as they were prior to those amendments so as to understand the context in which the authorities to which I will shortly refer to were decided. 153 Jurisdiction of Commission in Court Session (1) The following functions of the Commission are to be exercised only by the Commission in Court Session: (a) proceedings for an offence taken before the Commission (including proceedings for contempt), … (3) Subject to subsection (4), the functions of the Commission relating to proceedings for contempt of the Commission may be exercised only by a Full Bench of the Commission in Court Session. (4) The functions of the Commission relating to the commencement of proceedings for contempt of the Commission may also be exercised by a judicial member. … 164 Powers of Commission as to the production of evidence, perjury and contempt … (2) The Commission in Court Session may exercise the functions of the Supreme Court in relation to the apprehension, detention and punishment of persons guilty of contempt of the Commission (including disobedience of any order made by or process issuing out of the Commission). (3) Without limiting subsection (2), a judicial member may exercise the functions of the Supreme Court in relation to the commencement of proceedings for contempt of the Commission. Note. Section 153 (4) provides that the functions of the Commission relating to the commencement of proceedings for contempt of the Commission may also be exercised by a judicial member. … 398 Time for instituting proceedings Proceedings for an offence against this Act or the regulations may be commenced not later than 12 months after the offence was alleged to have been committed. 1. Division 2 of the Industrial Relations Commission Rules 2009 relevantly provides: Division 2 Motion or proceedings for punishment 18.5 Application This Division applies to any contempt of the Industrial Court for which proceedings are not taken under Division 1. 18.6 Procedure generally (1) An application for punishment of contempt committed in connection with proceedings before the Industrial Court must be made by notice of motion in the proceedings. (2) An application for punishment of contempt committed otherwise than in connection with proceedings before the Industrial Court must be commenced by application. 18.7 Statement of charge A statement of charge (that is, a statement specifying the contempt of which the offender is alleged to be guilty) must be included or filed with the notice of motion or application. 1. Rule 237 of the Industrial Relations Commission Rules 1996 ("former Rules") was not replicated when the rules were revised in 2009. That revision had three aspects: the former rules were repealed; the Industrial Relations Commission Rules 2005 (IR Rules) were made; and the Uniform Civil Procedure Rules (Amendment No 31) was made. This last had the effect of applying the Uniform Civil Procedure Rules 2005 (UCPR) (except to the extent specified in Schedule 1) to the civil proceedings of the Commission. 2. For present purposes, rule 237 of the former Rules provided: 237 Motion or proceedings by the Registrar (1) Where it is alleged, or appears to the Commission on its own view, that a person is guilty of contempt of the Commission, the Commission may, by order, direct the Registrar to apply by motion for, or to commence proceedings for, punishment of the contempt. (2) Subrule (1) does not affect such right as any person other than the Registrar may have to commence proceedings for punishment of contempt. 1. I note that the UCPR does not deal with the procedures for proceedings for Contempt of the Supreme Court. Those procedures continue to be prescribed in Part 55 of the Supreme Court Rules 1970. Although there is a significant body of authority on the nature of contempt proceedings, as to whether they be civil or criminal, it is unnecessary to traverse that issue in this matter because proceedings for an offence against s 180 of the IR Act are clearly criminal proceedings. Therefore the UCPR will not apply to such proceedings. 2. Counsel for the applicant was not able to assist, despite her researches, with why no analogue to rule 237 of the former Rules was included in the IR Rules. Equally my own researches have not discovered a reason. The Authorities 1. The question of the standing of a party to commence proceedings for contempt was considered in Crewdson v Director-General NSW Department of Community Services (No 2) [2006] NSWIRComm 336. The Full Bench held that only persons who met the criteria in s 399(1) of the IR Act were able to commence proceedings for contempt. They said at [28]-[30]: [28] We are satisfied that s 399 deals expressly with the question of who has standing to commence proceedings for an offence against the Act. There are no relevant regulations to consider. Mr Crewdson is plainly not one of the persons specified in ss 399(1). He argues nevertheless, that he has the right to bring contempt proceedings at common law, given his standing as a party to the proceedings to which the contempt related. On his approach, ss 399(4) preserves his right to do so. The scheme of the Act is to confer upon this Court the same powers as that of the Supreme Court in relation to the conduct here in question. Mr Crewdson relied upon the approach of the Court of Appeal in European Asian Bank AG v Wentworth and Ors (1986) 5 NSWLR 445 in support the construction urged. [29] Were this a common law court, Mr Crewdson would undoubtedly have standing to bring contempt proceedings, given that he was a party to the proceedings in which the alleged contempts occurred. (See R v Dunbabin; Ex parte Williams (1935) 53 CLR 434.) Subsection 399(4) makes clear, however, that its purpose is to confirm, by reference to ss 164(2), that the Court has power to 'exercise the functions of the Supreme Court in relation to the apprehension, detention and punishment of persons guilty of contempt of the Commission (including disobedience of any order made by or process issuing out of the Commission)'. Subsection 399(4) does not create a wider class of persons who may initiate a prosecution in relation to the offence of contempt, than those earlier specified in ss 399(1). Had that been the intent of the subsection, it would have said so expressly, by making reference, for example, to such proceedings being able to be commenced by parties to the litigation in which the alleged contempt occurred. [30] Subsections 399(4) and 164(2) of the Act are concerned to ensure that the creation of the statutory offence of contempt and the provision made in the Act for the initiation of such offence proceedings by the persons identified in ss 399(1), does not limit the Court's power itself to act in relation to a contempt. The Act also seeks to ensure that, as a superior court of record, the Court is adequately armed with the powers necessary to deal with any contempt which arises before it or the Commission. This was achieved by the various references made to the Supreme Court and the exercise of its functions in relation to contempt. 1. The applicant submitted, quite properly and correctly in my view, that the effect of Crewdson was that the applicant did not have standing itself to commence a prosecution for contempt. 2. The applicant's submissions continued as follows: [31] On the clear words of s.164(2) of the IR Act, the Commission in Court Session has the power to exercise functions of the Supreme Court in relation to the "punishment of persons guilty of contempt of the Commission." "Punishment" naturally enough extends to the initiation of the punishment process, through the invocation of the Court's jurisdiction. This is supported by the Court of Appeal's view of s.164(2) in Uniting Church as being concerned with ancillary functions which make the Court's power under s.180 effective. 1. In Uniting Church in Australia Property Trust (NSW) v Industrial Relations Commission (NSW) (2004) 60 NSWLR 602 at 609, Mason P held that the Commission's jurisdiction to hear proceedings for the offence created by s 180 of the IR Act was conferred by s 180(3). Ancillary powers necessary to make s 180(3) effective were conferred by s 164(2). 2. As I have noted, proceedings for contempt of the Supreme Court are regulated under Pt 55 of the Supreme Court Rules. Rule 11(1) provides: Where it is alleged, or appears to the Court on its own view, that a person is guilty of contempt of the Court or any other court, the Court may, by order, direct the registrar to apply by motion for, or to commence proceedings for, punishment of the contempt. 1. The essence of the applicant's submission is that the Commission has power, found in s 164(2) of the IR Act, in like manner to the Supreme Court, to direct the Industrial Registrar to commence proceedings for contempt. 2. In support of that proposition the applicants submissions continued [33] To make good the submission that s 164(2) of the IR Act includes the power to direct the Industrial Registrar to commence contempt proceedings, which is a question of statutory construction, it is necessary to have regard to the statutory context. Until 20 December 2013, s 164(3) of the IR Act provided: "Without limiting subsection (2), a judicial member may exercise the functions of the Supreme Court in relation to the commencement of proceedings for contempt of the Commission". (emphasis added) [34] Section 164(3) was repealed on 20 December 2013 by Sch.1 [14] of the Industrial Relations Amendment (Industrial Court) Act 2013 (NSW) ("Industrial Court Amending Act"). At the same time, the Industrial Court Amending Act repealed ss.153(3) and (4) of the IR Act, which had provided: "(3) Subject to subsection (4), the functions of the Commission relating to proceedings for contempt of the Commission may be exercised only by a Full Bench of the Commission in Court Session. (4) The functions of the Commission relating to the commencement of proceedings for contempt of the Commission may also be exercised by a judicial member." [35] It is submitted that s.164(3) stood as a clear indication that the power conferred by s.164(2) included the power to exercise the same powers as those available to the Supreme Court relating to the commencement of contempt proceedings. The only reason why s.164(3) was repealed was as a consequence of the suite of amendments to the IR Act that had the effect that the jurisdiction of the Commission in Court Session could only be exercised by a single judge rather than by a Full Bench. There was therefore no longer a need to specify which powers of the Commission in Court Session could only be exercised by a Full Bench and which could be exercised by a single judge. The repeal of s.164(3) of the Act did not serve to narrow the power conferred upon the Commission in Court Session by s.164(2). [36] It is worth noting that s.153(4) and s.164(3) were only introduced into the IR Act on 1 January 2004 by Sch.4 of the Courts Legislation Amendment Act 2003 (NSW) to address the mischief identified by the Full Bench in Industrial Registrar v Uniting Church in Australia (2002) 120 IR 370. At the time of that decision, the power to direct the Industrial Registrar to commence a contempt prosecution could only be exercised by a Full Bench of the Commission in Court Session. Such a direction had previously been made by the Full Bench. The Industrial Registrar duly filed a motion to initiate a contempt prosecution and the defendant then applied to the Full Bench to disqualify itself on the grounds of apprehended bias. The defendant submitted that where one Full Bench had directed that the contempt proceedings be instituted, a differently constituted Full Bench must hear the matter. The Full Bench acceded to the disqualification application and also pointed out the difficulties of the then statutory scheme, which left it to the Full Bench to direct the Registrar to commence contempt proceedings. The Full Bench said at [7]-[8]: "there are some unsatisfactory features of the present statutory scheme to which reference should be made. The Full Bench in the Statement issued on 20 March 2002 accepted that the scheme, because of the terms of ss 153(2) and 164 of the Industrial Relations Act 1996 (NSW), required that any order made under r 237 be made by a Full Bench. Consistently with that view, any further proceedings pursuant to such order would also have to be heard by a Full Bench. Although the policy rationale for such proceedings being determined by a Full Bench is clear, and this is analogous to the similar situation in the Supreme Court, there is no apparent reason why the making of an order to commence proceedings should of necessity be made by a Full Bench. This situation is not analogous to that in the Supreme Court and it raises practical difficulties not there arising. This Court is comprised of a relatively small number of judges and if the basis of the respondents' arguments were correct, although we have not accepted it, the situation could easily develop where proceedings, such as those before the Court with some prior history within the jurisdiction, could not be heard by a sufficient number of judges to constitute a Full Bench. In this event resort may need to be made to the doctrine of necessity. We commend this matter for consideration by the Legislature, particularly as to whether the Act should be amended to enable the commencement of proceedings pursuant to r 237 to be dealt with by a single judge." [37] It was after those recommendations that s.154(3) and 164(3) were added to the IR Act. 1. With the exception of one matter (which is of no consequence in the current circumstances) I accept these submissions of the applicant. The point of departure is in relation to the limitation contained in [35] and highlighted above. I accept that it was the intention that the jurisdiction could be exercised by a single judge but in my view it did not preclude a Full Bench from exercising the jurisdiction. 2. The respondent sought and was granted an adjournment to put his submissions in writing. Those submissions, and subsequent oral submissions, did not contend that the Commission lacked power to direct the commencement of such proceedings. The respondent's submissions proceed on the inherent premise that such power exists. He contended that it should not be exercised. 3. While it is intriguing that the current rules do not contain an equivalent to the former rule 237, I do not consider that can detract from the construction of the statute itself. The IR Rules are designed to facilitate the efficient conduct of proceedings before the Commission. It is the statute which grants and limits the Commission's jurisdiction. 4. The power to make Rules is governed by Chapter 4 Part 6 of the IR Act. Section 185C(1), which is within that Part, empowers the Commission to give directions: … with respect to any aspect of practice or procedure not provided for by or under this Act, the Criminal Procedure Act 1986, the Civil Procedure Act 2005 or any other Act 1. The absence of a specified procedure in the IR Rules is therefore able to be accommodated by the making of an appropriate direction. In my opinion that is what is being sought in this matter. 2. It follows from my acceptance of the applicant's submissions that I find that the Commission has power to direct the Industrial Registrar to commence such proceedings. Test to be Applied 1. As to this aspect Ms Sharp of counsel submitted: In Rocks v Uniting Church in Australia (2002) 115 IR 256 at 260, the Full Bench noted that the Court had a discretion (then under r.237 of the IRC 1996 Rules) as to whether to refer a contempt matter to the Industrial Registrar. The test applied was whether the evidence provided a "sufficient basis for the allegations to be considered". It was also noted that the application was not frivolous or vexatious. In Emibarb Pty Ltd t/as the Lagoon Seafood Restaurant v Matters [2005] NSWIRComm 312 ("Emibarb"), the Court made an order (then pursuant to s.237 of the IRC 1996 Rules) directing the Industrial Registrar to commence proceedings for contempt. The test applied for making the referral was again stated as being whether the material placed before the Court provided a "sufficient basis for the allegations of contempt to be considered" (at [32]). The Court also noted that there was not an innocent explanation for what had transpired and that the drawing of the allegations to the Court's attention was not frivolous or vexatious (at [31]). 1. Mr Stonham for the respondent submitted: [24] In order for the Court to make the orders sought by the Applicant, the Applicant must establish a prima facie case that each of the following elements can be proved beyond reasonable doubt: a. That there has been a wilful breach of an Order or Undertaking by which a person is bound; and, b. Of which the person has notice. 1. I consider the formulation of the test as stated in Rocks and applied in Emibarb is both binding on me and, in any event, the appropriate measure by which to determine this aspect. Sufficient basis 1. The respondent relied on a decision of the Supreme Court in Wyszenko v Wyszenko [2012] NSWSC 732 per White J in support of the contention that the breach which had admittedly occurred was not wilful. In particular he relied on [17] and [20] of the judgment: [17] The question is not whether the defendant acted recklessly or deceitfully in agreeing to the orders of 11 October 2011. The question is whether her failure to make the payment of $40,000 required by 25 October 2011 was deliberate or wilful. In my view, her failure to make that payment could not be so described if, as I have found, she was unable to make the payment. … [20] I accept the defendant's evidence that she hoped that moneys would be forthcoming with which to make the payment in time, although I am not satisfied that there was a reasonable basis, at the time when she consented to the order, for that hope. That does not mean that her failure to comply with the order within time was deliberate or wilful. For these reasons, the contempt is not established. 1. There are two significant differences in my view between this matter and that considered by his Honour. First, I am of course considering a different issue. It is not for me to decide whether an offence has been committed. I need to determine whether there is a sufficient basis to justify the order sought. 2. Second, there is also a considerable factual difference between this case and that considered by his Honour. In Wyszenko the defendant had only 14 days to acquire the funds to discharge the order. Mr Elleray has had a considerable period of time to make arrangements that would permit him to comply with the order (or some agreed variation of it had he pursued that course). He has a property asset in which it appears he has more than sufficient equity to discharge the debt to the applicant and satisfy the order made against him. He has not considered that alternative. 3. There is another matter which was not addressed by either party but to which I should give consideration. The limitation period for commencement of the prosecution is six months. That raises issues as to the construction of the order. 4. The relevant order is as follows (emphasis added): (6) In the event that the Appellant is ultimately successful in the Appeal, the Respondent is required to pay back to the Appellant all amounts paid by the Appellant to the Respondent pursuant to orders 2 or 3 of these orders under a monthly repayment plan of $1,000 per month. 1. One question is what is to be understood by the phrase "ultimately successful in the Appeal". Does it refer simply to the date of decision by the Full Bench or to the decision of Newall C? The third possibility is that it relates to the date of the President's decision on the appeal from Newall C. I don't consider it necessary to decide that issue. Rather having regard to the test of sufficient basis I should proceed on the basis most favourable to the respondent. That is the date of decision on the applicant's appeal being 30 September 2013. 2. The order however requires monthly repayments (at the rate of $1,000 per month). Therefore there is an obligation under the order arising each and every month until the sum is repaid. Given that the amount to be repaid is in excess of $25,000 the order has a life of at least 25 months. If the correct commencement date is 30 September 2013 there is a sufficient basis for me to conclude that the obligations under the order continue until on or about 30 October 2015. 3. Having regard to these considerations I am satisfied that a sufficient basis exists to justify making the order sought. Order 1. I order that this matter be referred to the Industrial Registrar for the commencement of proceedings under section 180 of the Industrial Relations Act 1996 (NSW) for punishment of the respondent's contempt of the Commission. ********** Amendments 22 May 2015 - Paragraph numbering corrected. 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. Decision last updated: 22 May 2015