AG2003/7137, Transcript of Proceedings [2003] AIRCTrans 4287 (30 September 2003)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS


O/N 4667
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER SIMMONDS

AG2003/7137

APPLICATION TO TERMINATE
AGREEMENT (PUBLIC INTEREST)

Application under section 170MH of the
Act by Belandra Trading Pty Ltd re
termination of Belandra Trading Pty Ltd
and the Australasian Meat Industry
Employees Union Agreement 2000

MELBOURNE

10.13 AM, THURSDAY, 11 SEPTEMBER 2003

PN1

MR C. O'GRADY: I seek leave to appear on behalf of Belandra Trading Pty Ltd.

PN2

MR L. ARMSTRONG: I seek leave to appear on behalf of the Australasian Meat Industry Employees Union.

PN3

THE COMMISSIONER: Thank you. On the presumption there is no objection, leave is granted. Mr O'Grady?

PN4

MR O'GRADY: Thank you, Commissioner. The position is that we have our application on foot. We filed with the Commission at the time of filing the application an affidavit of Mr Gilbert Cabral, and that is the evidence that Belandra Trading Pty Ltd proposes to rely on in relation to the application. Mr Cabral is here today available for cross-examination, and we wish to proceed with our application, Commissioner.

PN5

THE COMMISSIONER: Yes. I understand from correspondence there is at least a likelihood of an application for adjournment, so I had better deal with that.

PN6

MR O'GRADY: Very well, Commissioner, yes.

PN7

THE COMMISSIONER: Mr Armstrong?

PN8

MR ARMSTRONG: Indeed, Commissioner, there is a very high likelihood of an application for an adjournment. I take it, Commissioner, that you have had an opportunity to at least look at the correspondence that was sent by the union's solicitors. I understand there is also a reply to that correspondence from the solicitors acting for the company. The application that we foreshadowed in our correspondence, Commissioner, is an application, firstly, that the company's section 170MH application be adjourned generally pending the outcome of the Federal Court proceedings which have been foreshadowed in our correspondence.

PN9

The alternative application that we make is that the substantive hearing of the company's 170MH application not proceed today, and that the Commission today instead program this matter so that the substantive application can be progressed and ultimately heard by the Commission in an orderly way and in a way that ensures the Commission is fully apprised of all the circumstances which attend this application.

PN10

Commissioner, if I might firstly deal with the primary application we make, which is that today's 170MH application be stood over generally. Commissioner, do you have to hand a copy of the application that has been filed by the company?

PN11

THE COMMISSIONER: Yes.

PN12

MR ARMSTRONG: Yes. Now, Commissioner, you will see that the company in its application sets out the usual particulars of the date of the agreement, and notes that it expired several weeks ago on 16 August this year. Point 4 refers to the termination of the employment of former employees of the company in June 2001, and at points 5 and 6 the company informs the Commission that the grounds on which the application is made include that the company does not intend resuming operations in the future, and will not be employing any employees in the future.

PN13

Now, in support of that application, Commissioner, as my learned friend has pointed out, the company relies only on the affidavit of Mr Pierre Gilbet Cabral, which deals in some short order with the fire which occurred at the company's former operating site in Brooklyn, the subsequent termination of the employment of its former employees. And I should note, or just draw the Commission's attention to the fact that the company was engaged in small stock slaughtering at the Brooklyn site.

PN14

At paragraph 8 of the affidavit Mr Cabral refers to the company's initial intention to resume operations, but that the decision had been taken in September 2001 that, in fact, it would not resume slaughtering operations. At paragraph 9 he points out that Belandra Trading currently has no employees other than those receiving WorkCover. At paragraph 10, that Belandra Trading is not operating and has no intention of resuming operations. And at paragraph 11, an undertaking on behalf of Belandra to maintain certain entitlements.

PN15

Now, Commissioner, in my respectful submission this application is remarkable for what the Commission has not been told. We sought briefly in our letter addressed to your associate, Commissioner, dated 9 September 2001, we attempted to alert the Commission just briefly to some of the background circumstances to this application. Now, Commissioner, we refer in our letter to the fact that there is recently a decision of North J in the Federal Court of Australia, dealing with an application by the union against another company which is related to the present company. The other company is Belandra Pty Ltd.

PN16

Commissioner, if it is of assistance, I have a copy of that decision of the Federal Court which I can hand up. Now, before I take you to that decision in any detail, Commissioner, just to outline the facts briefly. Mr Cabral, the deponent of the affidavit relied on in support of this application, is a director of Belandra Trading Pty Ltd, he is also a director of a number of other companies which together are customarily described as the Tasman Group.

PN17

The Tasman Group, for present purposes, it should be noted includes a company called Industry Park Pty Ltd, Belandra Pty Ltd, Belandra Trading Pty Ltd, Tasman Group Services, or TGS Pty Ltd, and Tasman Group Holdings, or TGH Pty Ltd. The evidence that was given in the Federal Court proceedings, Commissioner, and which I don't understand is disputed at all, is that prior to the fire at Brooklyn the Tasman Group conducted a large and extensive abattoir and boning operation at its premises in Brooklyn.

PN18

The operation was structured as follows. Industry Park owned the premises, Belandra did the beef slaughtering, Belandra Pty Ltd did the small stock slaughtering - sorry, Belandra Trading Pty Ltd did the small stock slaughtering, Export Meat Processors did beef boning primarily to service a contract that Belandra Pty Ltd had with the Coles Supermarket chain, and Export Meat Packers did some beef boning and also small stock boning.

PN19

Now, the evidence in the Federal Court also dealt with the manner in which the companies were operated, Commissioner. As I indicated a moment ago, Mr Cabral is a director of Tasman Group Services, Tasman Group Holdings, Industry Park Pty Ltd, Belandra Pty Ltd, Belandra Trading Pty Ltd, Export Meat Packers and Export Meat Processors, as well as certain other companies which are relevantly related within the meaning of the Corporations Law.

PN20

The slaughtering operations of both Belandra and Belandra Trading Pty Ltd were overseen by one Sean Carroll. The boning operations of both Export Meat Packers and Export Meat Processors were overseen by Mr Cabral's brother, Bernie Cabral. Mr Cabral himself oversaw all of the operations at Brooklyn, and together with Mr Joseph Catalfamo was the senior director of the Tasman Group and each company within it.

PN21

The Federal Court has found, Commissioner, that, in fact, it was Mr Catalfamo who had the final say in decisions taken in respect of group companies and the way in which they operated. And for that reason, Commissioner, you will note that the Federal Court decision focuses primarily on Mr Catalfamo's state of mind.

PN22

Now, in June 2001, Commissioner, as Mr Cabral briefly mentions in his affidavit, there was a fire at the Brooklyn site. Following the fire the employees of Belandra - I beg your pardon, I should say that the fire destroyed the slaughtering facilities and destroyed the boning facility which had been operated by Export Meat Packers. There was another boning facility operated by Export Meat Processors which was only slightly damaged and, in fact, resumed work fairly soon after the fire itself.

PN23

Because of the destruction of the other facilities, the companies Belandra, Belandra Trading and Export Meat Packers exercised a power given to them by their respective certified agreements and terminated their employees other than employees in receipt of WorkCover benefits, on the basis that the employees would be re-employed. Under that power the company was entitled to withhold redundancy payments for eight months and, in fact, the companies did withhold those payments.

PN24

The evidence in the Federal Court, Commissioner, was that although the companies purported initially to intend to re-employ the workers who had been terminated under the eight month provision in the certified agreements, in September 2001, some three months after the fire, Mr Catalfamo together with Mr Cabral made a decision that the companies, in fact, would not re-employ those workers. Instead the companies embarked on a course of action which resulted in them proceeding with some earlier negotiations for the purchase of a disused abattoir at Altona, also in western Melbourne.

PN25

Through various corporate arrangements which are not presently relevant, the result was that the Altona premises passed into the hands of TGH. Mr Catalfamo and Mr Cabral then established TGS, not in an incorporation sense but in a sense of setting up TGS to operate an abattoir and some boning facilities at the Altona site. There were discussions between the directors of the Tasman Group companies and Mr Carroll, who, the Commission will recall, I mentioned a moment ago as the person who had formerly been the operations manager for the slaughtering operations at Brooklyn.

PN26

As a result of those discussions Mr Carroll incorporated another company called Larburg. TGS then engaged Larburg to act as the manager of its operations at Kyle Road. I should say that Kyle Road is the Altona site. Larburg is a company, the shares in which are owned by Mr Carroll. Its employees constitute at least some of the foremen and management staff at Altona. To the best of the union's information, the majority, if not all of those employees, are former foremen and management staff from the operations at Brooklyn, and, indeed, the Federal Court so held.

PN27

The Larburg company in turn is responsible for the conduct of the operations at Kyle Road. It has or had engaged a labour hire company known as ESP Tecforce, which I will refer to as Tecforce, to supply it with labour. It is a condition of employment with ESP Tecforce that any prospective employee sign an Australian Workplace Agreement. And evidence was given in the Federal Court that the conditions in the AWAs are very substantially inferior to the conditions in the certified agreement which previously applied at least in relation to the Belandra employees, that is, the beef slaughtering workers.

PN28

The structure therefore at Altona is that Tecforce supplies labour to Larburg, which manages the abattoir and also supervises the labour. In doing so it operates a slaughtering facility which is structured as the provision of slaughtering services by Larburg to TGS. TGS performs those services, it appears from the material given in evidence in the Federal Court Proceeding, TGS in turn provides those slaughtering services to Belandra for the purposes of Belandra's contract with Coles, and it seems TGS also services some third party unrelated companies, but those companies are themselves former clients and customers of Belandra and Belandra Trading.

PN29

The evidence and the findings in the Federal Court are that the decisions that were taken by Mr Catalfamo with Mr Cabral to embark on this course of action were taken by them in September 2001, were taken by them in their capacity as directors not only of Belandra but also of Belandra Trading and EM Packers. Affidavit evidence given by Mr Cabral in the Federal Court refers to the decision in relation to Belandra, and says that similar decisions were taken by the same directors at the same meeting in relation to the other companies, including Belandra Trading.

PN30

Now, the Federal Court has held, Commissioner, that the conduct that was undertaken by Belandra, which was the primary respondent to the Federal Court proceeding, was conduct engaged in, in contravention of section 298K of the Workplace Relations Act. The conduct constituted a refusal by the company to employ its former workers, and also an alteration of their position to their prejudice.

PN31

The Federal Court held that this conduct was undertaken for the reason or reasons including the reason that the company wished, to use the words of section 298L, for reason or reasons including the reason that the former workers were members of the union, the AMIEU, and also for the reason or reasons including the reason that the workers were entitled to the benefit of the certified agreement which applied to Belandra.

PN32

The Federal Court has made declarations that Belandra, by this conduct, contravenes section 298K, and has stood the matter over until 26 September this year, that is later this month, for further directions in relation to the question of relief. Now, Commissioner, I wish to emphasise that when we talk about Belandra in the context of the Federal Court proceeding, we are referring to decisions taken by individuals, and those individuals were Mr Catalfamo and Mr Cabral, the same Mr Cabral who has sworn the affidavit which is relied on by the company in support of its present application.

PN33

Now, I have attempted in some detail to describe the effect of the Federal Court in those circumstances. I am happy to take the Commission to particular paragraphs, if that is of any assistance. Alternatively, if the Commission is so minded, I am happy to rely on the summary which I have just given. But I will perhaps just draw the Commission's attention to several paragraphs. Firstly, Commissioner, paragraph 7 on page 5 of the Court's decision. The Court there refers to Mr Catalfamo having been the effective decision maker of the decisions which I have just described to you, Commissioner.

PN34

Paragraphs 5 and 6 describe the structure of the operations at Brooklyn, and I believe, Commissioner, I have accurately summarised the effect of the findings of the Court there. At paragraphs 14 and 15 the Court sets out the decisions that were taken by the company Belandra in relation to setting up operations at Kyle Road. And if I might perhaps just jump to page 84, Commissioner, at paragraph 5 of the quote set out on that page, his Honour, North J, is setting out a passage from Mr Catalfamo's affidavit material, and the final sentence of paragraph 5 page 84, in setting out Mr Catalfamo's purported reasons for the various decisions, Mr Catalfamo says explicitly:

PN35

Similar decisions were made by the directors of Belandra Trading and EM Processors in the period August-September 2001.

PN36

Now, I should note, Commissioner, that North J expressly rejected the evidence that had been given by Mr Catalfamo by way of purported innocent explanation for the decisions which had been taken, and the Court found that, in fact, the references in the company's evidence to corporate restructuring and wanting to set up a new business model, which was called the Westfield model, were a convenient fog obscuring the fact that the company no longer wished to deal with the union, no longer wished to have to deal with the consultative and other arrangements in the certified agreement, and no longer wished to employ union members.

PN37

Those findings are set out in some considerable detail on paragraphs 223 through to the end of the decision. I refer in particular to paragraphs 224, where the Court refers to Mr Catalfamo's musings as a convenient fog, and to paragraphs 231, where the Court refers to the history of industrial disputation at the Brooklyn site, and evidence given by Mr Paul Davey on behalf of the union. And his Honour then, at paragraphs 232 and 233, sets out at great length the viva voce evidence that had been given by Mr Catalfamo in which the true reasons for the decisions that he had taken in relation to Belandra and Belandra Trading are set out.

PN38

Now, Commissioner, in light of the evidence and the findings in the Federal Court, in our respectful submission there is already a very serious concern, a very serious question that Belandra Trading, in terminating the employees and now telling this Commission that it does not intend to resume operations and does not intend to employ anyone in future, is simply referring the Commission, in effect, to the consequences of the course of conduct that Belandra Trading embarked on in September 2001 as a result of a decision of its directors made in relation to it and the other companies in the Tasman Group.

PN39

That decision has already been found by the Federal Court of Australia to constitute a contravention of section 298K and freedom of association provisions of the Workplace Relations Act. As I mentioned at the outset, Commissioner, the Federal Court proceeding that I have just taken you to was an action against Belandra and some of its related entities, particularly TGS and TGH, but not against Belandra Trading.

PN40

As we indicated in our correspondence, Commissioner, the union does propose to bring an equivalent application in the Federal Court in relation to Belandra Trading. My friends make some play of the fact that that hasn't been done in the past. Commissioner, you can imagine the scale of the exercise that was involved in the existing Federal Court proceeding, and the decision deals with a number of areas which have been in the past the subject of some considerable discussion in earlier authorities.

PN41

In those circumstances it is not, in my respectful submission, surprising that the union has not taken action previously in relation to the Belandra Trading aspect of the matter, but certainly it could not be said that Belandra Trading has suffered any prejudice in not being sued earlier. Now, in my respectful submission, Commissioner, there are a number of issues which are thrown up by the circumstances which I have described to you, and thrown into stark relief by the application which the company now makes.

PN42

First of all, in light of the circumstances and the Federal Court decision, the Commission, in my respectful submission, might well consider that the affidavit is somewhat less than full and frank in telling the Commission about exactly what is going on with Belandra Trading and its related entities. The Commission might take the view that the affidavit is less than full and frank as to the intentions of the Tasman Group, and, in particular, what is going to happen at the Brooklyn abattoir.

PN43

The evidence that has been given in the Federal Court is that the Tasman Group, who knows which entity within the Group, but some entity has been rebuilding the small stock slaughtering facility at Brooklyn. It was substantially complete at the time of the Federal Court hearing in March this year. It appears, so far as we have been able to observe, to be now complete. And the company, or the directors of the companies, Mr Catalfamo and Mr Cabral, gave evidence in the Federal Court that it is the intention to return small stock slaughtering from Altona, the temporary operation at Altona, to Brooklyn once the Brooklyn slaughtering facility has been reinstated.

PN44

The evidence given in the Federal Court was that that was expected to be at the end of this year. There was also evidence given in the Federal Court that in June 2002, once the Tasman Group had acquired control of the Altona site, the group undertook sales of some of the land at the Altona site, the land comprised the former employee car park. Evidence given in the Federal Court, including by Mr Cabral, was that the contracts of sale in relation to those parcels of land included a provision that the abattoir facility at Kyle Road cease operations by the end of this year.

PN45

In those circumstances, Commissioner, for Mr Cabral in his affidavit to state somewhat blandly that Belandra Trading has no intention to resume operations and will not employ anyone in future, somewhat begs the question as to exactly what is going on in this group? That is the first point, Commissioner, that the Commission may well be concerned about the forthrightness with which the evidence given by the company is being given.

PN46

Secondly, Commissioner, in light of the surrounding circumstances the Commission, in my respectful submission, ought to feel a very serious concern that the conduct of Belandra Trading, tied as it is to the conduct and the decisions of Belandra Pty Ltd, raises an appearance at the very least of conduct in contravention of section 298K and the freedom of association provisions of the Act, in the same way as has been found to be the case in relation to Belandra Pty Ltd.

PN47

The Commission, in my respectful submission, ought to feel a very serious concern that Belandra Trading has structured its operations to give an appearance that it no longer conducts any slaughtering operations and will not employ anyone, and therefore this agreement no longer has any work to do, and having created that appearances comes to this Commission and says, well, look at what we show you, in those circumstances this agreement has no work to do, and it is not contrary to the public interest that the agreement be terminated.

PN48

Having done that, related companies, if not Belandra Trading itself, then returned from Altona to Brooklyn and resumed small stock operations, presumably now confident in the expectation that any arguments about transmission of business and the continued operation and application of the former Belandra Trading Certified Agreement have been excluded.

PN49

Commissioner, there are authorities in this Commission in relation to the exercise of jurisdiction under section 170MH, to the effect that where the applicant, for the termination of the certified agreement, appears to have engaged in conduct involving duress or to be contrary to the freedom of association provisions of the Workplace Relations Act, then that is a very serious matter going to the public interest. If I might paraphrase or perhaps go further and explain why that must necessarily be so.

PN50

It cannot be the case that a company can engage in conduct in contravention of section 298K or the other anti-coercion and anti-discrimination provisions of the Act, and then come to this Commission and say that having engaged in that conduct it has created a situation where the agreement or the employees which have been the target of the conduct, ought now to be the subject of orders from the Commission which further prejudice their position.

PN51

In the present case, a company which has gone to very great lengths to, by unlawful means, exclude the operation of its certified agreement, ought not be heard by the Commission to now say, well, having done all of that, the Commission ought look no further than what we say to you, and having looked no further, the Commission ought to terminate this agreement.

PN52

Can I hand up, Commissioner, two authorities on which we rely in support of that proposition. The first is a decision of his Honour, Munro J, in Joy Manufacturing Company Pty Ltd, regarding the Mossvale Certified Agreement, and the second is a very recent decision of Commissioner Whelan in September this year, in the Geelong Wool Combing case. If I could ask you firstly, Commissioner, to turn to the decision of Munro J in the Joy Mining Machinery Certified Agreement decision.

PN53

The Commission will see there that Munro J, from paragraph 8 through to paragraphs 22, describes what was a very extensive series of attempts at negotiation and ultimately industrial disputation in relation to the work site in that case. It is, of course, important to notice, Commissioner, that the Joy Manufacturing decision involved an application to terminate a certified agreement ostensibly for the purposes of negotiating a new certified agreement where there had been ongoing negotiations.

PN54

I should note that there is no such application in the present case. This is simply an application to terminate an agreement. There have been no attempts at negotiation with AMIEU in relation to a new agreement to apply at Brooklyn or, indeed, at Altona. At paragraph 34 of the decision, Commissioner, Munro J refers to the notion of public interest which arises under section 170MH. First, this, I might say, is discussed by Commissioner Whelan in the Geelong Wool Combing decision, and I think it could fairly be said to reflect the most narrow view of public interest for the purposes of section 170MH, but nonetheless it is indicative. About halfway through paragraph 34, Munro J says:

PN55

The concept of public interest does not, in my view, embrace considerations which are essentially derivative from the individual interest of the employer or employees. That is not to deny an individual interest may have an overlapping public interest dimension. The individual interest in freedom of association or in freedom from certain kinds of discrimination is an instance.

PN56

Thus, Commissioner, even on the most narrow view of what public interest means in the context of section 170MH, Munro J would include within the public interest concerns relating to freedom of association. At paragraph 59 of the decision on page 24 of the print that I have handed to you, Commissioner, Munro J again refers to the lack of prohibition in the Act on the form and procedure for agreement making, but that doesn't exclude conduct associated with attempts to make a new agreement from being found to be unfair, to be bargaining in bad faith, or perhaps even to the action of an employer not genuinely trying to reach agreement. And then over the page at paragraph 61, Commissioner, Munro J says:

PN57

It is not necessary to develop a detailed formulation of the principle I have outlined. It is sufficient for present purposes that there is a public interest concern with freedom of association, rights to effective and fair agreement making, an implicit duty to genuinely try and reach agreement.

PN58

Now, the last two aspects of that statement obviously are not relevant to the present case, because there is no attempt by this company to make a new agreement. But as I say, even on the most narrow formulation of public interest in the Joy Manufacturing decision, Munro J would include concerns relating to freedom of association. Commissioner, if I could also ask you to turn to the decision dated 5 September 2003 in the Geelong Wool Combing case.

PN59

The earlier part of the decision relates to a number of - or the application to terminate certain superseded agreements, and is not presently relevant. But on page 21 of the printout which I have handed to you, paragraph 184, Commissioner Whelan again refers to what I might loosely describe as a notion of unclean hands in relation to section 170MH applications. The Commissioner says that she is:

PN60

Satisfied that the Workplace Relations Act requires parties to engage in the bargaining process to behave fairly and to genuinely seek to reach an agreement. It does not require that the bargaining parties are on equal footing or that they are restrained from utilising provisions of the Act to exert pressure on each other. It may be that actions by a bargaining party, while lawful, can be illegitimate and amount to duress. It may be that actions taken for a purpose other than that of furthering claims made also amount to bad faith bargaining because the party is not genuine.

PN61

To skip paragraph 185, but continue at paragraph 186:

PN62

In my view, in the absence of duress or a finding that a party is not genuinely trying to reach an agreement, the Workplace Relations Act allows parties to engage in the kinds of tactics which are designed to induce the other party to concede. There is a point at which such tactics may become unfair to the extent that it would not be in the interest of the public to allow a party to benefit from such actions.

PN63

Now, Commissioner, the notion of unfairness in that context must surely embrace the notion of conduct in contravention of the express provisions of part XA and, indeed, other parts of the Workplace Relations Act. It is to be noted, Commissioner, that the objects of the Act include freedom of association. In my respectful submission, Commissioner, the circumstances in this case give rise to a very serious concern that this company has engaged in conduct in contravention of section 298K and, indeed, Commissioner, that this application to the Commission is, in effect, the final step in that course of conduct to ensure that this company is successful in escaping the effects and the ongoing operation of the certified agreement.

PN64

In some senses, Commissioner, I am reminded of the situation of the administrators in Patricks, who were placed in a position where they had little alternative but to terminate the employment of the union employees. The company in this case, by its restructuring, can be and it will be argued to have, in endeavouring to establish a situation where it appeared to the Commission that this agreement had no further work to do, and that it was therefore not contrary to the public interest for the agreement to be terminated.

PN65

In my respectful submission, in those circumstances the Commission, acting in the public interest, would not lend its aid to such an application. Now, turning to more practical matters, Commissioner. The evidence that the union would propose to rely on in support of its opposition to the company's application under a section 170MH, is going to be very extensive evidence. It will overlap very greatly, if not entirely, with the evidence that has already been given in the Federal Court proceedings. More importantly, it will overlap entirely with the evidence that will be given by the union in the Federal Court proceedings against Belandra Trading which have been foreshadowed in correspondence.

PN66

That evidence is likely to require some considerable number of days, as well as the issuing of a number of subpoenas, which I don't know whether the Commission is aware, but a number of those have already been lodged with the Commission with a request that they be issued in the context of this application in the event that the application were to be listed for substantive hearing. There will therefore, Commissioner, be a very extensive and expensive duplication of work in this Commission in connection with the MH application, and in the Federal Court in relation to the application against Belandra Trading under section 298K.

PN67

That duplication would be avoided if the Federal Court proceeding was first completed. On the other hand, it would not be avoided if the Commission were to proceed in the meantime. It would still have to be given in the Federal Court proceeding. There is also the danger, Commissioner, that two tribunals hearing the same evidence could potentially reach findings that were inconsistent with each other. And it is in the interests of comity between decisions of the Federal Court and decisions of this Commission that the Commission, in my respectful submission, adjourn this application by the company generally pending the outcome of the foreshadowed Federal Court proceeding.

PN68

The company's solicitors in correspondence have said that it is not clear that any outcome in this Commission would prejudice the Federal Court proceeding. It may not be clear, Commissioner, but it is likewise not clear that it will not prejudice the Federal Court proceeding. The application that has been made in the Belandra Federal Court proceeding includes an application for injunctive relief, in effect, restraining the Tasman Group from obtaining the services of meat workers other than the former Brooklyn employees, and further, restraining them from providing terms and conditions less favourable to those employees than the terms and conditions in the Belandra Certified Agreement.

PN69

The Commission can infer that similar relief will be sought in the Federal Court application against Belandra Trading. And if the Commission were to terminate the certified agreement, then the impact of that on the Federal Court's deliberations in relation to relief, for instance, is not clear, and could, indeed, prejudice the employees. Looking at it from the other side of the fence, as it were, Commissioner, even if the Commission were to take the view that the Commission proceedings might not influence the outcome of the Federal Court action, in my respectful submission the outcome of the Federal Court proceedings would very profoundly influence the Commission's consideration of the company's application.

PN70

If the Federal Court were to hold that the company's conduct, the subject of Mr Cabral's brief affidavit, was conduct in contravention of section 298K, and, indeed, potentially, Commissioner, to find that this application reflected the culmination of that conduct, then that would be a very serious matter for the Commission to take into account in working out whether it would be contrary to the public interest to terminate this agreement.

PN71

Lastly, Commissioner, if one accepts Mr Cabral's affidavit, then it is quite clear that there is no legitimate prejudice that Belandra Trading can point to if its application under section 170MH is deferred. If Belandra Trading does not intend to resume processing and will not employ anyone, then one may well ask, why is it bothering to make this application? On the strength of the company's own affidavit material, Commissioner, there is no urgency in this application, there is no need for it to be heard now or even any time soon, as opposed to it being adjourned for a considerable period, if not adjourned sine die, pending the outcome of the Federal Court proceedings.

PN72

In all of those circumstances, Commissioner, in my respectful submission it is appropriate that this application by the company be adjourned generally to await the outcome of the Federal Court proceedings. As I said, Commissioner, we don't resile from the fact that as at today those proceedings are only in the course of preparation. But if that was a concern to the Commissioner, I can say that the union has given instructions to institute those proceedings, and steps are being taken to do so, and we anticipate they will be instituted within a very short period, indeed.

PN73

Now, Commissioner, the alternative application that I wish to make, is that in light of the, as it were, preview, which I hope I have forwarded to the Commission, of the evidence that the union will propose to lead in opposition to the company's application, this matter ought not proceed today, but should instead be programmed so that steps can be taken in an orderly fashion to prepare the matter for hearing, and to ensure that the Commission is able to be fully apprised of all of the circumstances that attend the application, and not merely the blandest and baldest and most incomplete of statements which is currently before the Commission.

PN74

As I have indicated, Commissioner, we would be seeking to - well, we would be requesting the Commission to issue a number of summonses directed to the entities which are involved in the operations at Altona, and the Commission can readily infer that with the addition of Belandra Trading and the other entities, the various respondents to the Federal Court proceeding, and also Industry Park Pty Ltd. We would also be seeking to file what will be extensive witness statements from the union outlining the history of events at Brooklyn and at Kyle Road, and also it is, of course, appropriate that steps be taken, and, indeed, they must be taken under section 170MH, to obtain the views of the employees.

PN75

I omitted to mention earlier, Commissioner, that the need to obtain the views of the employees is mandatory under section 170MH, and that is another reason why it is appropriate for this application to be adjourned generally pending the outcome of the Federal Court proceeding. The Federal Court proceeding may very substantially change the definition of the group of persons who are to be treated as employees for the purposes of section 170MH.

PN76

In that regard, Commissioner, you may recall that in, I think it was January this year, there was an application under section 170MH by Export Meat Processors for the termination of the agreement which applied to it. That application was also opposed by the union. And if it is of any assistance to you, Commissioner, I can hand up the transcript of that application, and simply note that one of the reasons which you gave, Commissioner, for adjourning that application pending the outcome of the Federal Court proceeding in relation to that company, was that there was a need to obtain the views of the parties to the agreement, and the uncertainty as to who they might be pending the outcome of the Federal Court proceedings, and referred to the fact that the employees and the definition of the employees could be very seriously affected by the Federal Court proceeding.

PN77

I should also note, Commissioner, that we noticed in the correspondence that was sent to us late last night, and which I believe was also sent to your associate, that my learned friend's instructors refer to the application in relation to the EM Processors agreement, and also the EM Packers agreement, and say that the Commission ought to take judicial note, as it were, of the fact that the AMIEU consented to the applications to terminate that agreement.

PN78

Now, Commissioner, we regard that as a rather improper communication, because that consent by the AMIEU was pursuant to terms of settlement of the Federal Court proceedings. Now, I am not at the moment going to breach the confidentiality which is supposed to apply to those terms, other than to say that the terms authorise me to tell you that there were terms of settlement. Now, if my friends wish to press that point, then we will regard that confidentiality as waived, and would be quite happy to tell the Commission and provide a copy of the remainder of the terms, and not simply the bit whereby the AMIEU consented or agreed to the termination of those certified agreements.

PN79

I think, Commissioner, that that is all I wish to say in-chief in support of our application. That the company's application today, firstly, be adjourned generally to await the outcome of the foreshadowed Federal Court action. I should note that the Commission can, of course, provide liberty to apply in the event that the company forms the view that the Federal Court action, for instance, doesn't go to this present application. And, alternatively, if the Commission is not minded to adjourn the matter generally, then in that event, nonetheless not to deal with the substantive application today, but instead to simply program it for hearing at an opportune time, to ensure that the Commission can be fully apprised of all of the circumstances which attach to this application.

PN80

THE COMMISSIONER: Yes. If I wasn't convinced by either of those arguments, and wanted to proceed, you could make application for adjournment at the completion of the other side's case. Would you be in a position to - I presume, from what you have said, that you would want to cross-examine Mr Cabral - would you be in a position to proceed to that today? I guess my question is, if not, why not?

PN81

MR ARMSTRONG: Commissioner, I spent yesterday preparing to cross-examine Mr Cabral. I would be in a position to start the cross-examination today. I imagine that cross-examination would take at least one day, more likely close to two. I would prefer not to start it today, but I am in a position to do so if the Commission wants.

PN82

THE COMMISSIONER: No, I understand that. It is a matter that, I mean, goes to practicalities in a sense. This matter has only been listed for this morning, you might notice, and I have got other matters this afternoon.

PN83

MR ARMSTRONG: Yes, I did notice that, Commissioner. But certainly the Commission had indicated that it was listed for hearing. I have, to the extent that I am able to, subject to the subpoena or summonses question which I mentioned a moment ago, I am in a position to start the cross-examination of Mr Cabral in the absence of the documents, which, of course - I should say, Commissioner, that a number of the categories of documents relate to or are the same as documents which have been requested and in some cases provided in the Federal Court proceeding. But of course I am not able to use them in this proceeding. It would be helpful if we had them before I had to cross-examine Mr Cabral, because beyond those documents my ability to put propositions is, or certainly to challenge propositions, is limited. But if the Commission was - - -

PN84

THE COMMISSIONER: Has there been any approach to the other side for consent to use those documents?

PN85

MR ARMSTRONG: No, not yet, Commissioner.

PN86

THE COMMISSIONER: So we have fought it on the basis that they are going to be opposed so far? I appreciate that summonses have at least been foreshadowed, they may even been more than that, but I am not taking the action in regard to those, but my preference always is that the party - I mean, we get caught by legal practice a bit, and I want to try and avoid that as much as possible, and seek the cooperation of parties in expediting processes before the Commission, rather than the Commission having to use coercive powers, and I would encourage that. I do encourage that and continue to encourage it in this matter. Yes, thank you, Mr Armstrong. Mr O'Grady?

[11.12am]

PN87

MR O'GRADY: Thank you, Commissioner. The current proceeding involving Belandra Pty Ltd before North J does not involve Belandra Trading Pty Ltd as a party. There is no mention of Belandra Trading Pty Ltd in the application in the Federal Court proceeding before North J, nor is there any mention of it in the statement of claim. There have been no findings as against Belandra Trading Pty Ltd in the decision of North J. There has been no relief granted other than the declaratory relief in relation to Belandra Pty Ltd. And I am able to inform the Commission that Belandra Pty Ltd has given my instructors instructions to appeal against the decision of North J.

PN88

And, Commissioner, the ultimate relief that is sought in the current proceeding before North J, insofar as it relates to Belandra Pty Ltd, insofar as that relief is relevant, is that Belandra Pty Ltd be restrained from refusing to employ its employees under the terms of the Belandra Certified Agreement. There is two things I say about that, because it is relevant to any proposed application in relation to Belandra Trading, in respect of which the union says it will make application seeking the same relief.

PN89

The first is, a restraint from refusing to employ, does not in any way entail continued employment in the meantime, and second, there must be considerable doubt as to whether the Court could entertain an application for relief which requires the employer to employ the employees under the terms of the certified agreement which has since expired. Now, what we say, Commissioner, is this.

PN90

It is speculative, to say the least, that if such an application is commenced by Belandra Trading Pty Ltd, that, one, it will be successful, and two, not only will it be successful but it will require, or in some way impose an obligation on Belandra Trading to employ people under the terms of the agreement which is the subject of this application. We say, Commissioner, it is even more speculative when you have a look at the fact that it has always been open to the union to make application to the Federal Court under the freedom of association provisions in relation to Belandra Trading, or, alternatively, join it to the existing proceeding which has been on foot since, I think, early last year. I am happy to be corrected on that, Commissioner.

PN91

It didn't do so. And two days before this application is listed for hearing they pipe up and say, oh, oh, but hang on, we are going to go off to the Federal Court and get relief in relation to Belandra Trading. There must be a question about the genuineness of that position. And, Commissioner, it may well be that there is some estoppel argument available that stops the Federal Court proceeding from getting underway in any event. We also say this, Commissioner. There is nothing to establish any existing actual prejudice to the union or the employees in the event that this application proceeds.

PN92

The first point is this. The existing employees number 4, they are all on WorkCover, and there are undertakings given in relation to any accrued rights that they may have. And, Commissioner, you will recall the applications for the termination of the EM Packers and EM Processors agreements. That was the same situation in relation to those applications. There were undertakings given in relation to the existing employees who were on Workers Comp.

PN93

The second thing is this. Any employees who Belandra Trading might be restrained from refusing to offer employment at some stage in the future, one, are not currently employees and, two, never will be employees as at now. Their interests are not relevant to this application. And it would be wrong to delay the hearing of this application on the basis of some speculative possibility that at some stage in the future those other people might have an interest in this agreement.

PN94

Now, Commissioner, your ruling in relation to the adjournment of the application to terminate the EM Processors agreement to which Mr Armstrong referred, your might recall that on that occasion one of the arguments was put forward was that at issue was the extent to which the Commission had to make the inquiry. Did it have to make the inquiry as to the views of the then employees, or, alternatively, if it waited until after the Federal Court proceeding it would not have to worry about the views of the then employees, or it may not have had to worry about the views of the then employees.

PN95

You will recall that in that case there was an interlocutory injunction in place which took effect shortly before Christmas, and required the EM Processors to continue the employment of those employees. We are not in that situation. And I come back to what I said before, and that is, that the other employees, the employees outside those in the list attached to Mr Cabral's affidavit, will never be employed as at now. Now, the other thing about that is this. There is nothing to suggest that the interests of those employees could not be adequately attained through the union, or that the union could not adequately represent their interests.

PN96

It cannot be said, Commissioner, that at some stage in the future the union and the other employees who are not currently employed will have any greater interest in the agreement than they do at the moment. Things won't change. There is nothing to suggest that this is outside the normal run of events referred to by his Honour, Munro J, in Joy Manufacturing. And, Commissioner, I understand you have got a copy of Joy. If you could have a look at paragraph 46 of Joy, it is on page 16 of the copy I have, Commissioner.

PN97

THE COMMISSIONER: Page 18 of the other one.

PN98

MR O'GRADY: Yes, it is always the way, isn't it, that the various electronic copies come out with different page numbers. But paragraph 46, in particular, the second part of that paragraph:

PN99

The Act does not provide for an unconditional right to indefinite continuance of the terms and conditions of an expired agreement.

PN100

In this case, relevantly, no head of public interest which would be offended if the conditions of the agreement were to be set aside. One has to have regard to the scheme of the Act in relation to the operation of certified agreements, Commissioner. I will come back to some other references to Joy in a moment. But the starting point is, parties are entitled to make an agreement for a set period of time up to three years.

PN101

Now, in the normal course of events, if you put to one side what is in the legislation, that agreement would then expire. But the Act jumps in and says, well, look, agreements actually continue, in order to provide protection for the employees the agreement continues, and that is section 170LX. But to counterweight that and to ensure that the parties are not bound by an agreement forever and a day, in the words of Munro J, there is no unconditional right to indefinite continuation of the terms and conditions. And that is why section 170MH is available.

PN102

Now, the transmission of business issue that sort of seemed to find its way into the submission that is made on behalf of the union, is itself again speculative. It seems to be put on the basis that there has got to be some public interest in ensuring that the agreement stays so that it can transmit at some stage in the future. Well, Commissioner, there is an argument, or the original application in the proceeding before North J sought relief in relation to the transmission of the Belandra agreement. That relief has not been pursued.

PN103

We say, Commissioner, this. Such an application by Belandra Trading, even if made and ultimately successful, is not in any way prejudiced by this application or by the granting of this application. There is absolutely no need for this agreement to remain in certified form to enable the Federal Court to grant the relief that might be sought in a proceeding issued by Belandra Trading, if it issues it.

PN104

The Federal Court can grant relief without the agreement being certified. There is no reason whatsoever why the Federal Court could not fashion appropriate relief. And, Commissioner, I remind you that the relief sought in the existing proceeding against Belandra is not dependent in any way on the Belandra agreement being certified. All that is sought is an order that restrains Belandra from refusing to employ people, whoever they might be, on terms of the agreement.

PN105

And I come back to what I said before, and that is, that it is unlikely that the Court will grant relief which takes those employees who might be the subject of that relief, beyond the rights that they would otherwise have in the legislation. It does more than remedy the mischief. It gives them an entrenched right beyond that which the Act makes available. Having a look at the public interest, Commissioner, in Joy at paragraph 34, Mr Armstrong took you to a passage which he finished reading about three lines from the bottom of that paragraph, where his Honour was dealing with the individual interest. The last sentence in that paragraph is equally important:

PN106

However, in my view, it is necessary to examine whether a consideration does go in any material or substantive way to the public interest as distinct from the interests of the protagonists before the Commission.

PN107

Now, that reference to going to a material or substantive way to the public interest is again repeated at paragraph 38, the last line of paragraph 38, the last sentence:

PN108

The more fundamental considerations relevant to the public interest must be those which have most substance to what are perceived to be interests and welfare of the community.

PN109

And in paragraph 40, Commissioner, the second sentence:

PN110

I am unable in the circumstances of this case to discern in that consideration any substantive effect on the public interest the termination of the expired agreement would cause.

PN111

So the reality is that there has got to be some substantive adverse effect on the public interest before this Commission can refuse an application to terminate a certified agreement. Now, in this case, Commissioner, there is no issue of divestiture of accrued rights. No employees other than the Workers Comp employees have any such rights, and insofar as the Workers Comp employees do have any accrued rights, they are protected by the undertakings proffered in the affidavit of Mr Cabral.

PN112

So all that can be said is this. At its highest, Commissioner, the other employees have some elusively contingent right which may arise at some stage in the future if everything else falls into place. But what we say is, even that right is not interfered with, because the Federal Court can fashion the necessary relief. So what we say, Commissioner, is that the employees are in no different position to any employee who is facing the termination of the certified agreement, that is, falling back onto the award. And you will recall in paragraph 42 in Joy, his Honour says there has got to be something additional.

PN113

But the allegation here is that there is something additional, and that something is that it is a course of conduct in breach of the freedom of association provisions, or in contravention of the freedom of association provisions. That is what is being alleged.

PN114

MR O'GRADY: Commissioner, that is what is being alleged. But all that has happened is that there has been a repeat of the allegations that - - -

PN115

THE COMMISSIONER: No. Yes, I understand that it is a repeat of the allegation. But if I am to continue to hear the matter, then they are entitled to make that allegation out with evidence.

PN116

MR O'GRADY: That goes to the second application which Mr Armstrong has made in relation to directions and being entitled to hear.

PN117

THE COMMISSIONER: But it is not unimportant to the first one either, because there is the issue of comity. I mean, he is saying that there is a - you know, and I don't think you can dismiss it lightly, the instructions that have been received are to commence action. Now, I understand that that bit is not speculative. I understand it is speculative what the outcome of the action might be and, indeed, whether or not the action might be estopped, I understand that. But that element of it is speculative, and you are quite correct. But I don't think it is speculation to say that the action is going to commence. I think that would be quite improper at least.

PN118

MR O'GRADY: Well, I am not saying that.

PN119

THE COMMISSIONER: And I know you are not saying that, that is right. So we have got a situation where the action is going to be commenced against the party in this agreement, and there is an allegation involved in that of the breach of 298K and the freedom of association.

PN120

MR O'GRADY: One would have to question, Commissioner, how all of that relates to this application in any way whatsoever?

PN121

THE COMMISSIONER: Well, as I understand it, it is that this application forms part of that conduct.

PN122

MR O'GRADY: It is said this is the final chapter. Well, Commissioner, how can this be the final chapter? How can this in any way be said to be a final chapter in some - I presume, it is not said, but I am presuming it is some scheme to get the union out. It can't be anything to do with the agreement, because if that is the case then no person could come to this Commission and seek to have an agreement terminated.

PN123

THE COMMISSIONER: Well, it would depend on the circumstances, surely. I mean, they could come along and seek to have it, if a case could be made - and I am not saying that the case has been made at all - but if a case could then be made that the action in seeking to terminate the agreement was part of a course of conduct designed to exclude the union or exclude persons with union membership, then surely that would be a matter that went to the public interest?

PN124

MR O'GRADY: Well, we say there is an easy response to that, Commissioner, and that is this. How could it possibly have that consequence? The fallback is the award, the union has rights under the award, and - - -

PN125

THE COMMISSIONER: No. Well, I hear what you are saying, but as I hear the allegation, it is that falling back under the award would affect the capacity of the union to deliver services or the capacity of the employees to obtain the services of their union in negotiations with the employer.

PN126

MR O'GRADY: And how is that any different to the situation that Mr Munro J - - -

PN127

THE COMMISSIONER: No. But it is the reason for which it is done, that is the difference.

PN128

MR O'GRADY: Well, Commissioner, with respect, the question would be, what is the effect of the termination of this agreement, and how is it said to be adverse to the public interest?

PN129

THE COMMISSIONER: Well, as I understand how it is being said, is that it is part of a course of conduct that the employer is taking in breach or in contravention of the freedom of association provisions of the Act.

PN130

MR O'GRADY: Yes.

PN131

THE COMMISSIONER: And it would have to make that out clearly.

PN132

MR O'GRADY: Of course, Commissioner.

PN133

THE COMMISSIONER: And that that invokes the issue of the public interest, because the Commission ought not assist that process.

PN134

MR O'GRADY: Yes. Well, our response to that is, even if you accept all of that, it can't be said to be assisting that process by terminating the agreement.

PN135

THE COMMISSIONER: Well, why not? I mean, I am not sure, but it could be said that easily, that is the point I am making.

PN136

MR O'GRADY: Well, because all that it does is put the position back to the award.

PN137

THE COMMISSIONER: But that might be quite a significant prejudice in the employment.

PN138

MR O'GRADY: Well, with respect, no, Commissioner, because the authorities - - -

PN139

THE COMMISSIONER: Well, if someone is getting $100 a week over the award, and the termination of the agreement takes that $100 off them, that would be prejudice by anyone's standard.

PN140

MR O'GRADY: Well, the authorities say that that of itself is not enough. And we say, Commissioner, that there can be nothing of that sort because at the moment there are no employees. There may at some stage in the future be employees, and if there are employees it is entirely a matter for the Federal Court to decide the basis upon which those employees come back. And if the Federal Court decides that the basis those employees should come back is on the terms of this agreement, then it can fashion relief to do so.

PN141

THE COMMISSIONER: Yes, that might relate to those employees. What about future employees if there is a - I mean, there is a lot of ifs here, but, you know, this is where the union's interest comes in.

PN142

MR O'GRADY: Well, that again, we are now really getting into speculative territory.

PN143

THE COMMISSIONER: Well, I understand that. I understand that, and it is exactly for that reason it seems to me the problem that you are dismissing - and this is where I came in - that there is more than that. That if I am to proceed with this matter, then the Commission runs the risk of hearing exactly the same sort of evidence that will go before the Federal Court. There is the issue of comity.

PN144

MR O'GRADY: Well, we say that should not be an impediment, Commissioner.

PN145

THE COMMISSIONER: Well, how are you prejudiced by that, assuming that - I mean, I hear you say it is not an impediment.

PN146

MR O'GRADY: Commissioner, I can't point you to any substantive prejudice that we would suffer as a result of an adjournment over a lengthy period of time, other than to point to the public interest in this Commission dealing with applications of this nature efficiently and effectively. But what I do say is that there is no established prejudice on the other side, and it is their application for an adjournment.

PN147

THE COMMISSIONER: No. I accept that. The issue of prejudice seems to me to be absolutely neutral from what you have just said. I mean, there is this prejudice, I think, from the other side, and that is the expense element that was referred to, involved in the duplication of proceedings, which it brings on itself in a sense.

PN148

MR O'GRADY: Yes. Well, that wasn't a matter that I think you had any concern about in relation to the EM Processors application, Commissioner.

PN149

THE COMMISSIONER: No.

PN150

MR O'GRADY: And I would say it ought not be a matter that concerns you.

PN151

THE COMMISSIONER: Sorry, I was correct in my earlier comment, where I said I can't see there is prejudice either way, but then I said, well, there is - - -

PN152

MR O'GRADY: But it cuts both ways.

PN153

THE COMMISSIONER: Well, it affects both sides too.

PN154

MR O'GRADY: It cuts both ways.

PN155

THE COMMISSIONER: But that is another consideration of a separate sort. But I am more concerned about - I am expressing a view now that I am concerned about the comity issue.

PN156

MR O'GRADY: Well, my response to that is, that we are all mature industrial relations players and - - -

PN157

THE COMMISSIONER: But in the absence of any prejudice.

PN158

MR O'GRADY: Yes, in the absence of - well, in the absence of any prejudice, the comity issue cuts both ways. I mean, we all have to come here. But, Commissioner, we would be urging on you that this application is not one that supports some wild excurses into the long history of the operations of different entities that have operated the abattoirs and the various rooms at Brooklyn, and those which have done the same at Altona.

PN159

THE COMMISSIONER: Well, I guess if they are trying to make out a case that there is a course of conduct being involved in that is in breach of the freedom of association provisions, I can't really stop them. That is their case.

PN160

MR O'GRADY: That is their case, and if that is the way they want to run it - - -

PN161

THE COMMISSIONER: I mean, and matters that are relevant to that seem to me to be - - -

PN162

MR O'GRADY: - - - they bear the burden of running it, Commissioner.

PN163

THE COMMISSIONER: I accept that.

PN164

MR O'GRADY: Both here and the Federal Court, if that is what they want to do.

PN165

THE COMMISSIONER: The point wasn't in relation to that, the point was in relation to - because I thought you were saying that the application did not involve an excursus into the wider area, and I was responding to that proposition, that if someone is running a case that is on the freedom of association provisions, then so long as it is relevant to that, and they would be saying it is, I can hardly avoid that excursus, can I?

PN166

MR O'GRADY: Well, if we get down that path, Commissioner, there will be submissions made about how that can possibly be relevant and how necessary as it is.

PN167

THE COMMISSIONER: But it is not as simple - - -

PN168

MR O'GRADY: The other thing about this is this, Commissioner. I mean, we are talking about people who might be employed at some stage in the future. I mean, the reality is, your obligations under the Act in relation to section 170MH are the here and now. The transmission issue can only be relevant to employees who may have some entitlement to the agreement in the future. So we submit it is not a relevant consideration for you.

PN169

THE COMMISSIONER: Sorry, does it flow from that, are you saying, that the issue of - no, it can't flow from that, I don't think. I mean, I can accept that position as a bald statement. But you are not saying that that is a defence, are you, to the argument that this is part of a course of conduct by Belandra Trading to avoid - - -

PN170

MR O'GRADY: Well, no. I go back to my other propositions in relation to that, Commissioner.

PN171

THE COMMISSIONER: Yes. I am just making sure I didn't misunderstand you.

PN172

MR O'GRADY: And Mr Armstrong took you to some comments that fell from Commissioner Whelan in Geelong Wool Combing. Well, that case was quite remarkably different to the one that you are faced with, Commissioner. In Geelong Wool Combing - and I don't know whether you have had a chance to look at the decision, Commissioner. It concerned a number of applications to terminate a number of agreements. Relevantly the most recent agreement was the one which was refused, or the application in respect of the most recent agreement was refused. But the basis upon which it was refused was this. The Commissioner found that there was a course of conduct in the negotiation for a new certified agreement to replace the one that was the subject of the application, of intransigence on the part of the employer.

PN173

There are a number of sticking points, and the Commissioner found on the evidence that the employer was deliberately obstructive about those points so as to bring about a situation where this application could be made. In the background there are concerns over whether the company would continue to operate in Australia. One of the entitlements in the agreement was a more generous redundancy package.

PN174

So the Commissioner found that it was open to her to infer that the course of conduct showed in the lead up to and the application for termination of the agreement, a deliberate attempt by the companies to avoid paying out employees on the basis of the more generous severance payments. And that went straight to the loss of accrued rights which was identified in Joy. And we say we are not in any way in that league. There is no issue of accrued rights at all.

PN175

THE COMMISSIONER: And I think perhaps more importantly, the reference that I was taken to talks about the tactics being unfair in the context of tactics for negotiating a new agreement.

PN176

MR O'GRADY: Exactly, Commissioner.

PN177

THE COMMISSIONER: But it may be that it was an argument by analogy that people shouldn't benefit as a consequence of, well, unlawful action even, if it be unlawful.

PN178

MR O'GRADY: I am not sure what the identified benefit is there, Commissioner. I mean, it has been asserted that - - -

PN179

THE COMMISSIONER: Well, I guess it is avoiding any future obligation that might come about if this agreement is not terminated.

PN180

MR O'GRADY: The answer lies in the Federal Court proceedings, Commissioner. So the job for you, Commissioner, is this. To evaluate the alleged adverse public interest and assess whether it has any substance, whether it is substantive.

PN181

THE COMMISSIONER: That is right. And as I say, I expressed the concern about the comity issue. But if I am going to be hearing, and it sounds like I am going to be hearing an extensive debate about whether it is relevant anyhow, so I have got to go through all that process as well. But let's assume for the moment that the case proceeds as your opponents say, I hear the same sort of evidence that would be before the Federal Court in the foreshadowed application, with the potential that the Commission comes to a different conclusion.

PN182

MR O'GRADY: Well, Commissioner, that will be a matter subject of submission. But what we would say to that is, that there needs to be no findings about - - -

PN183

THE COMMISSIONER: No. But that has been put forward in the context of why we should adjourn.

PN184

MR O'GRADY: There needs to be no findings on the part of this Commission about that past history in any event.

PN185

THE COMMISSIONER: Well, that would be your argument, yes.

PN186

MR O'GRADY: Yes.

PN187

THE COMMISSIONER: But if you were unsuccessful with it, then the issue of comity does - I mean, there is a lot of speculation in all of this.

PN188

MR O'GRADY: Well, there is, Commissioner. And what we are talking about is, putting this application off for a long period of time, one would have to have regard to what the Federal Court will do with any proposed application, how will it treat the evidence in the Belandra proceeding in relation to this proposed proceeding, how will the evidence be run? So there is that issue. Then you have the issue of the evidence in this matter. So there is like quite a mix. And it may well be that the Federal Court says we are not going to touch this new application until the appeal in the other matter is dealt with. What happens then? This thing continues to go on, and there is no evidence at all anywhere.

PN189

THE COMMISSIONER: But there is no prejudice either.

PN190

MR O'GRADY: But, Commissioner, there is no established prejudice on the other side of the table.

PN191

THE COMMISSIONER: No. I accept that.

PN192

MR O'GRADY: The prejudice would be, there is a missed opportunity for this Commission to deal with the evidence.

PN193

THE COMMISSIONER: Yes, well, that is true, that is definitely true. That might not be the Commission's prejudice, of course, taking a very selfish point of view about it.

PN194

MR O'GRADY: So at the end of the day what we say is, why should we be forced to wait what might possibly be some years to deal with this application in the normal way in a situation where the case for the union will not get any better? In relation to the directions, Commissioner, well, we have had a discussion about evidence, etcetera. I think our position in relation to that is, well, look, whilst our preference would be to forge ahead, and that our evidence is that of Mr Cabral, I look at the practical reality.

PN195

THE COMMISSIONER: Well, the practical reality is getting more difficult.

PN196

MR O'GRADY: And see that nothing would be gained by putting Mr Cabral in the witness box today. So I see by weight of circumstance we are forced down the path of some sort of directions as to the future conduct of the matter. Those are the submissions.

PN197

THE COMMISSIONER: Yes. Mr Armstrong?

[11.47am]

PN198

MR ARMSTRONG: Thank you, Commissioner. To start with the last proposition first. My learned friend asks why the company should be forced to wait for what could be a substantial period of time before the Commission deals with this application? The short answer to that is, because there is a very real question before the Commission as to whether this company has unlawfully created a situation which it now seeks to utilise for its benefit.

PN199

He says that the union case won't get any better in the Federal Court. That is not so at all. If the union is successful against Belandra Trading in the Federal Court, then Belandra Trading, in point of law, will have been found to have engaged in this course of conduct unlawfully. And we say, on the strength of the authorities, and the Commission would be quite right to say that we referred to Geelong Wool Combing, for instance, as an argument by analogy, but on the strength of the authorities, this Commission ought not lend its succour to a company which has manufactured a situation unlawfully, where it creates an appearance of, for instance, there now only being four employees and them all being on WorkCover, and not having any intention of employing anyone in future, oh, but by the way, we won't tell you about what the rest of the group is doing, by Mr Cabral in conveniently forgetting a decision I made at the same time in my other hat as director of Tasman Group Services and Tasman Group Holdings and Industry Park Pty Ltd and Belandra Pty Ltd, and I am not going to tell the Commission about that, and by the way, the Commission ought not even ask about it, because we say it is not relevant, is the company's proposition.

PN200

The crux of what has been put to you, Commissioner, is that the Commission ought not regard as relevant at all the fact that a company might have engaged in grossly unlawful conduct in creating a situation where it comes before the Commission, asking the Commission to exercise its powers in the public interest, and says that it is not in the public interest for this Commission to have regard to potentially findings of the Federal Court that the applicant, in connection with the immediate matter, has engaged in unlawful conduct. That cannot, with the greatest respect, even be countenanced.

PN201

My friend sought to distinguish Geelong Wool on a couple of bases, pointing out that Commissioner Whelan in that case had, as is the case, concluded that the company there had been intransigent in its negotiations for the replacement agreement. And as I said at the outset, this is not a situation where a new agreement is being proposed, and the Commission's assistance is not being sought to enable the parties to reach a new agreement.

PN202

But to say that a company which was intransigent in its bargaining position is somehow in a worse position than a company which appears to have engaged in a long term very carefully planned and deliberate course of conduct designed to get rid of union employees and create a situation where they escaped the effect of their certified agreement, such a company is in a better position in terms of the Commission turning a blind eye to that earlier course of conduct.

PN203

My friend says that there is no established prejudice for our part if the Commission were to act to terminate this agreement now. Commissioner, as was the case in the Belandra Federal Court proceeding, the allegation is that Mr Cabral and Mr Catalfamo, through their companies, have engaged in this course of conduct for the purpose of escaping the certified agreement, and this application to the Commission to kill off the certified agreement is a natural logical and foreseeable consequence of a desire by the company to perfect its plans and ensure that the certified agreement is terminated.

PN204

THE COMMISSIONER: Look, I don't think he was talking about prejudice in that context. I think it was prejudice by if the proceedings went ahead, if these proceedings went ahead. I mean, you would still be able to present that argument and convince the Commission or not, as the case may be.

PN205

MR ARMSTRONG: Yes, Commissioner.

PN206

THE COMMISSIONER: So I think that is the logical point.

PN207

MR ARMSTRONG: Yes. We then get into the situation of the comity and the duplication of expense, and what have you.

PN208

THE COMMISSIONER: Yes. Well, it brings us back into that circle. But I think the context in which there was no prejudice suffered was not that you wouldn't have the opportunity of arguing your case, or have it decided.

PN209

MR ARMSTRONG: I accept that, Commissioner. And as my friend quite candidly put to the Commission, there is no prejudice to the company if the company's application is adjourned even for a long period. The company, if the Federal Court proceeding is successful, then the orders made by the Court might, for instance, be orders similar to those which are sought in the Belandra Federal Court proceeding, which are to the effect that the company there be restrained from refusing to employ. That doesn't mean that it has to offer employment to the union workers, it simply means that if it offers any work to anyone it has to offer it to them first, and that it be on the terms and conditions no less favourable than the certified agreement that they have been on in the past.

PN210

Now, if similar orders are sought in this case, then that is not going to preclude the company - for instance, if the Federal Court were to order that the certified agreement effectively continue to apply to the employees, the subject of the application, then the company has to continue to apply and observe the certified agreement in accordance with its terms and the Act. And the Act would allow it at that point in time to then come to the Commission, if it wished to, and make its application to terminate the agreement, and then the Commission would at that point in time be able to consider the effect and reasons for the decision given by the Federal Court. If there are appeals by the company, so be it.

PN211

And to paraphrase Munro Js considerations in Joy Manufacturing, to investigate whether the company has, by its conduct following the Federal Court action, purged itself of the wrongs that led to the Federal Court issuing the injunctive orders. The company, if the union is successful in the Court, then orders will be made which very clearly affect the certified agreement, and if the orders sought by the union are made, then it will operate to reinstate the certified agreement. That doesn't preclude the company from later applying to terminate it.

PN212

Nonetheless, if the company applies to terminate the agreement now, and is successful, then that could potentially be an impact or an influence on the deliberations of the Federal Court. So the union does potentially suffer a significant prejudice in the conduct of its application in the Federal Court. My friend referred to the expense of dual proceedings in this Commission and in the Court as cutting both ways. Well, in my respectful submission it doesn't cut both ways. It is two cuts, both in the same way.

PN213

For instance, the union is not put to the expense of having to run the case in the Commission and also the case in the Federal Court. Likewise, the company doesn't have to incur two sets of expense. If the Federal Court action runs, then the evidence is given there will not be open to challenge as between the parties when they come to the Commission, regardless of the outcome of the Commission proceedings, however. So I should say that there is therefore a potential for a very substantial cost and time saving to the Commission and to the parties in connection with the 170MH application.

PN214

THE COMMISSIONER: Yes, I think the business about cutting both ways was that it applies to both sides.

PN215

MR ARMSTRONG: If that is the way it was put, then certainly, Commissioner, yes.

PN216

THE COMMISSIONER: That is as I understand it. It is an equal prejudice, if you like.

PN217

MR ARMSTRONG: My friend also made the point that it is not clear exactly what form of orders the Federal Court has the power to make by way of injunctions restraining conduct in contravention of section 298K. If I understood the argument correctly, then I can respond to it by pointing out to the Commission that in a considerable number of cases now, including the EM Processors proceeding between the union and other Tasman Group companies, the Federal Court did issue an injunction requiring the company to not refuse to employ the workers, likewise that happened in Patricks v MUA, it happened in O'Connors, another AMIEU proceeding, and I believe - I haven't been able to check this obviously this morning, but I believe it happened in AMIEU v Peerless. It has happened in innumerable cases.

PN218

My friend also made the point that regardless of the outcome of the Federal Court proceeding, the employees who would be the subject of that proceeding will never be employees here and now. This is again an incident of the company's argument that the Commission should accept at face value the situation that has been manufactured by the company, and say, well, look at the consequences of our conduct in contravention of 298K? As a result of that conduct we have now only got four employees. Ignore the reason and the process by which that came about, just look at the fact that there are four employees, and disregard everything that has gone before, and hope that the Federal Court doesn't form the view later on that all of the other employees whose employment has been affected by this conduct in contravention of the Act, are not reinstated or somehow made - or reinstated to be persons who really are relevant to the Commission's deliberations in this application.

PN219

My friend says that the other employees, former employees, have no interest in the agreement, and therefore no interest in any application to terminate the agreement. An aspect of the finding that has already been made by the Federal Court is that at the time of the decisions of the conduct were made, the employees did continue to be entitled to the benefit of the certified agreement, it is readily to be inferred that a similar finding could be made by the Court in relation to Belandra Trading employees and the Belandra Trading Certified Agreement.

PN220

My friend made the point and referred to the various provisions of the Act dealing with the making of certified agreements and the ability of parties to make and terminate them. I simply refer, or note for the Commission's reference, section 3F of the Act, which is the objects section, which specifically refers to the object of the Act in maintaining freedom of association, and section 170LU(3)(a), which is a provision dealing with the making of certified agreements and, indeed, certification of certified agreements, and provides that the Commission must refuse to certify an agreement if it is satisfied that the employer has, in connection with negotiating the agreement, contravened the section, Part XA relevantly, of the Act.

PN221

Now, clearly from section 170LU, the freedom of association provisions are relevant to the Commission's discretion to certify an agreement, and in our respectful submission the same sorts of considerations are embraced within the notion of public interest which arises when the Commission is determining - - -

PN222

THE COMMISSIONER: Yes. But that seems to me to be less an argument about the adjournment, and more an argument about what the case is. Is that right?

PN223

MR ARMSTRONG: Yes, Commissioner, that is right, it goes to public interest. But the reason for the public interest being relevant to our application to adjourn is, because if the Federal Court finds that this company, in connection with the conduct that it now relies on to justify terminating the agreement, has contravened Part XA, then that finding must be relevant to the Commission's conclusions in relation to public interest. So it is all tied together.

PN224

THE COMMISSIONER: I mean, that is the difficulty, isn't it, that you can present the same information and invite the Commission to come to the same conclusion, and for it to act on it. It is just that you would not necessarily have to go through that process if there were an adjournment.

PN225

MR ARMSTRONG: Yes, Commissioner.

PN226

THE COMMISSIONER: Indeed, we would have to notice, wouldn't we, the decision in the Federal Court?

PN227

MR ARMSTRONG: Yes, Commissioner.

PN228

THE COMMISSIONER: Yes.

PN229

MR ARMSTRONG: And again it deals with the public interest, Commissioner, but the only final point I wish to make was, that my friend referred to there not being a public interest in ensuring that an existing certified agreement stayed in place. I don't need to address that point, but I can say that, for the reasons that I have advanced previously, there is a public interest in ensuring that a certified agreement is not removed on the strength of conduct which is in contravention of other very important provisions of the Act. If it pleases, Commissioner, those are the submissions in reply.

PN230

THE COMMISSIONER: There is just one matter which has peripheral bearing, but it might become critical. Is anyone in a position to judge when the outcome of an appeal would be likely? Probably not.

PN231

MR ARMSTRONG: No. No notice has yet been filed.

PN232

THE COMMISSIONER: I mean, that is another element, that in the same way as you foreshadowed your action, the other side has foreshadowed its action in regard to the original decision, and that leaves that up in the air too.

PN233

MR ARMSTRONG: Again, Commissioner, to that extent we come back to questions of prejudice, and I think the company has quite frankly said that there is none.

PN234

THE COMMISSIONER: Well, I mean, if the appeal goes against you, your case falls away, it seems to me, and that might be a stronger argument for at least adjourning to that point. Are you attracted at all by that, Mr O'Grady?

PN235

MR O'GRADY: Sorry, Commissioner, I was focusing on when the appeal documents had to be in by, and looking at the dates, and I didn't quite hear what you said.

PN236

THE COMMISSIONER: Well, the detail of that is not important. But what I am saying is, that should you be successful in the appeal, then I would suggest the opposition to your application in this matter falls away, and it might at the very least be useful in adjourning pending - - -

PN237

MR O'GRADY: Well, that is a matter for the other side.

PN238

THE COMMISSIONER: Yes, that is right. I mean, what is left?

PN239

MR O'GRADY: Well, it is difficult to predict what the consequences of the appeal would be, whether it has any impact on the other application.

PN240

THE COMMISSIONER: No. But if you were successful in your appeal against the decision in Belandra, then the other side is without a case. Well, they might have some other case, but the one that has been explained to me in the context of opposition to this application falls away.

PN241

MR O'GRADY: I think I have to accept that, Commissioner. We would, of course, be asserting that, if we are here some time down the track, and the appeal has dealt with the matter, we would naturally be asserting, well, there is no case against us.

PN242

THE COMMISSIONER: Well, I am just wondering whether at the very least an adjournment pending the outcome of that appeal is called for, because otherwise we really are running the risk of futility.

PN243

MR O'GRADY: Look, I am really not in a position to give you any guidance as to how long it is taking for appeals to be heard, but I would suspect it would be - - -

PN244

THE COMMISSIONER: No. I am just not assisted. No. Look, that was an unhelpful question even. The answer is obvious, we don't know. But it raises in my mind the question I have just put.

PN245

MR O'GRADY: Yes. I suppose our position is, well, it is still - - -

PN246

THE COMMISSIONER: Which is a different position than the one I have been asked to consider. I understand that.

PN247

MR O'GRADY: It is still long enough. The only saving really is that there is no putting on evidence in this Commission in the meantime, evidence which we are told really is a rehash of the evidence that has already been put, so is not something that would take a mountain of work to work up to put in a form that is before this Commission, and if the hearing goes - - -

PN248

THE COMMISSIONER: No. But then I reserve pending the outcome of the appeal. I mean, I wouldn't do anything else, would I?

PN249

MR O'GRADY: I think the only answer I can give you to that is, that the appeal, if successful, would be ..... for us in this application.

PN250

THE COMMISSIONER: Yes, I know. But from the point of view of the Commission, I mean, putting it at its very finest, essentially the argument would be relying by analogy on the outcome of the proceedings before his Honour, North J, and the findings he made in relation to those facts by analogy. And if it turned out that the Full Court was not with him - - -

PN251

MR O'GRADY: I accept that, Commissioner, subject to one qualification, and that is this. If the appeal has a consequence for Belandra Trading's application, where Belandra Trading's application is not proceeding in the Federal Court in the meantime, then we are in the same boat. But if things are running in the Federal Court in Belandra Trading, we are in the same position here.

PN252

THE COMMISSIONER: Yes, I understand that, but I am talking of Belandra. It seems to me that a very minimum it would - - -

PN253

MR O'GRADY: Because it is the Belandra Trading evidence that - - -

PN254

THE COMMISSIONER: The Belandra appeal seems to me to be a bottom line. I mean, I am having difficulty dealing with the argument in relation to Belandra Trading, and the potential Federal Court, because there is a lot of speculation there. That is not saying I have come to a view one way or the other about it, but I am conscious of the foreshadowed appeal and the relationship between the union's foreshadowed case in this matter that is before me right now, and the decision of his Honour, North J, in the Belandra matter, and the potential for that matter to have a different outcome as a consequence of your appeal.

PN255

MR O'GRADY: I have to accept the force of what you say in that regard, Commissioner, subject to what happens with Belandra Trading in the Federal Court.

PN256

THE COMMISSIONER: Yes. Well, how does Belandra Trading in the Federal Court even affect it?

PN257

MR O'GRADY: Well, it is the same material, supposedly the same material as would be put here.

PN258

THE COMMISSIONER: Yes. But if the appeal - well, the appeal seems to me to be critical in all of that.

PN259

MR O'GRADY: Well, if Belandra Trading is going ahead, then there is no additional effort in running this application really other than the hearing days, because the evidence - - -

PN260

THE COMMISSIONER: No, I am not talking about the effort. Sorry, you are misunderstanding. I think maybe I haven't explained myself. In running this case before the Commission - - -

PN261

MR O'GRADY: I think I understand what you are saying, Commissioner, the factual foundations is not there.

PN262

THE COMMISSIONER: It would take a lot to persuade me that I should come down with a decision in this matter, given the case that has been foreshadowed prior to the Appeal Bench giving its decision in your foreshadowed application.

PN263

MR O'GRADY: I have to accept that.

PN264

THE COMMISSIONER: And in those circumstances I think it is probably more appropriate that I adjourn the proceedings pending the outcome of that appeal.

PN265

MR O'GRADY: I have nothing further to say, Commissioner.

PN266

THE COMMISSIONER: Unless someone has got some view that I should take into account in relation to that, I think that is my decision.

PN267

MR O'GRADY: Very well, Commissioner.

PN268

THE COMMISSIONER: The proceedings are adjourned. They will be relisted. Sorry, I should, in fact, take that decision one step further. The proceedings will be adjourned pending the outcome of the foreshadowed appeal against the decision in Australian Meat Industry Employees Union v Belandra Pty Ltd, which is (2003) FCA 910. They will be relisted on application subsequent to that appeal decision, but the parties have got liberty to apply in the meantime.

PN269

MR O'GRADY: If the Commission pleases.

PN270

MR ARMSTRONG: If the Commission pleases.

PN271

THE COMMISSIONER: The proceedings are so adjourned. Thank you.

ADJOURNED INDEFINITELY [12.11pm]