WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2012 WAIRC 00903

DELIVERED : WEDNesday, 3 October 2012

FILE NO. : B 49 OF 2012

Applicant

AND

FBM Corporation Pty Ltd

Respondent

Catchwords : Industrial Law (WA) - Claim of denied contractual benefit - Issues in relation to applicant’s conduct under the contract of employment - Whether employee acted in breach of his contract of employment a relevant consideration - Application to adjourn pending the outcome of related Supreme Court proceedings - Whether in the public interest for both jurisdictions to proceed considered

Legislation : Industrial Relations Act 1979 (WA) s 27(1)(c), (f)

Result : Adjournment granted

Representation:

Applicant : Mr C Parrella

Respondent : Mr N Marouchak (of counsel)

Case(s) referred to in reasons:

Myers v Myers [1969] WAR 19 at 21

Registrar v Metals and Engineering Workers’ Union – Western Australia and others (1993) 73 WAIG 557

Graham Sargant v Lowndes Lambert Australia Pty Ltd [2001] WAIRC 02603; (2000) 81 WAIG 311

Anthony Joseph Portolesi v Fini Group Management Pty Ltd (1997) 77 WAIG 506

Garth Jason Waters v Taipan Pumps Pty Ltd [2006] WAIRC 04233, (2006) 86 WAIG 1144

Case(s) also cited:

Mr Matthew Valentine De Pledge v Moulding Industries Pty Ltd [2004] WAIRC 11157

Reasons for Decision – Application for Adjournment

The Claim Before the Commission

1          Mr Parrella claims that he has not been paid salary, commissions, expenses and superannuation entitlements by his former employer.  FBM Corporation Pty Ltd conceded in a Notice of Answer dated 28 March 2012 that certain monies are owing to Mr Parrella, however the company now disputes that any monies are owing.  Further, FBM alleges that Mr Parrella caused damage to the business due to a breach of his duties as an employee and that the damage that he has caused FBM should be offset against any monies to which Mr Parrella may be entitled.  Mr Parrella’s claim is set down for hearing to commence on 11 October 2012.

FBM Pty Ltd’s Application to Adjourn

2          FBM now has filed an application to stay the hearing.  In substance it is an application to adjourn the hearing to await the outcome of related Supreme Court proceedings.  The application states that on 22 June 2012 FBM initiated an action in the Supreme Court of WA against Mr Parrella and seven other former employees or contractors generally seeking damages for loss said to have been incurred as a result of their actions.

3          Mr Parrella is the second defendant and the claim is that he terminated his employment without notice on 21 February 2012, that he took with him certain property of FBM, that he erased electronic data the property of FBM and that he contacted FBM’s customers and potential customers in a way that caused them to cancel or not proceed with contracts.  FBM alleges that Mr Parrella caused loss, business disruption, and lost and cancelled contracts, and FBM therefore seeks damages for breach of contract, interest and costs.

4          FBM informed the Commission that the hearing should be adjourned because the Supreme Court proceedings involve the same subject matter as the subject matter of Mr Parrella’s claim.  In particular, both this Commission and the Supreme Court would need to decide whether Mr Parrella was suspended by FBM or whether he abandoned his employment; whether he took FBM’s property and whether he divulged confidential information to third parties. 

5          The submission is that Mr Parrella and the other seven defendants colluded.  It would be inappropriate, costly, and inconvenient, for the Commission proceedings to continue because of the Supreme Court proceedings.  Also, it would be undesirable for those seven defendants to hear the evidence which will need to be given in the Commission before they give evidence in the Supreme Court.  It would be contrary to the public interest for two jurisdictions to determine the same facts.

Mr Parrella’s Reply

6          Mr Parrella strenuously opposes any adjournment of his claim in this Commission.  In his view, whether staff walked out or were suspended has nothing to do with whether he is owed an outstanding commission payment.  He points out that his claim in this Commission was made first and that FBM’s claim in the Supreme Court contains only allegations.  The Supreme Court proceedings may take years and it would be unfair for him to have to wait for his entitlements to be paid to him.  The proper process is for him to have his case heard now, and if he is successful in this Commission but unsuccessful at a later date in the Supreme Court, he would be able to re-pay the monies at that time.

The Law

7          The Commission has the power in s 27(1)(f) to adjourn a matter before it.  It is well settled that the test to be applied is that where the refusal of an adjournment would result in serious injustice to one party, an adjournment should be granted, unless in turn this would mean a serious injustice to the other party (Myers v Myers [1969] WAR 19 at 21; Registrar v Metals and Engineering Workers’ Union – Western Australia and others (1993) 73 WAIG 557).  The decided cases indicate that there is no fixed rule that the Commission will adjourn a matter if there is a corresponding matter in the Supreme Court; it will depend upon the circumstances of the case Portolesi v Fini Group Management Pty Ltd (1997) 77 WAIG 506; Waters v Taipan Pumps Pty Ltd (ACN 097 145 527) [2006] WAIRC 04233; (2006) 86 WAIG 1144.

Consideration

8          The two matters, Mr Parrella’s claim against FBM and FBM’s claims against Mr Parrella (and seven other former employees or contractors), each turn upon the same set of facts.  Both the Commission and the Supreme Court will need to consider the terms of Mr Parrella’s contract of employment with FBM and determine the facts of what occurred. 

9          Whether Mr Parrella acted in breach of his contract of employment will be an important consideration in both this Commission and in the Supreme Court proceedings.  It is directly raised in FBM’s Notice of Answer in this matter and it is central to the action taken by FBM in the Supreme Court.  Although this Commission will decide whether Mr Parrella has not been allowed by FBM benefits to which he is entitled under his contract of employment, his claim for an order that FBM pay him any benefits will be decided according to equity, good conscience and the substantial merits of the case (Sargant v Lowndes Lambert Australia Pty Ltd (2000) 81 WAIG 311; and the appeal which was dismissed:  [2001] WAIRC 02603; (2001) 81 WAIG 1149).  This means that if Mr Parrella did act in breach of his contract of employment and caused loss and damage to FBM, he does not come here with clean hands.  The Commission would be slow to order FBM to pay him a benefit due under the very contract of employment of which he himself was in breach which caused loss and damage to his former employer.

10       Significantly, in this case the allegation that Mr Parrella’s alleged breaches were done in collusion with other former employees or contractors leads me to conclude that a proper consideration of Mr Parrella’s conduct will be assisted by the knowledge of the conduct of the other former employees or contractors.  In my view this is more likely to be established in proceedings to which they all are parties, that is, the Supreme Court proceedings, rather than in these proceedings involving only Mr Parrella.

11       If the adjournment is refused, FBM will be obliged to present much the same case in support of its allegations against Mr Parrella in two different jurisdictions.  It will run the risk of having different findings being made in relation to Mr Parrella’s conduct. It will be unable to recover its costs of doing so in the Commission because costs are generally not awarded in this Commission and not for the services of a legal practitioner (s 27(1)(c) of the Act).  I regard these as a serious injustice.  

12       If the adjournment is granted, Mr Parrella’s claim will not be heard for some time, and that is a serious injustice to him, however his claim is unlikely to be able to be finally decided by the Commission in the absence of knowledge of the conduct of the other former employees or contractors with whom he is alleged to have colluded.  This knowledge will necessarily be known after the Supreme Court proceedings are dealt with, and not by dealing only with Mr Parrella’s claim in this Commission.

Decision

13       In my view, the injustice to FBM if the adjournment is not granted is greater that the injustice to Mr Parrella if it is granted.  The adjournment will be granted.

14       An order will issue that the hearing date of 11 October 2012 be vacated and the hearing of this matter be adjourned to a date to be fixed.  As set out in FBM’s application, the order will provide that the matter be listed for mention in three months’ time. 

15       One consequence of granting the adjournment will be that there will be a delay before the evidence can be brought about whether Mr Parrella is entitled to the payment of the commissions he claims.  Neither Mr Parrella nor FBM submitted that an adjournment until the outcome of the Supreme Court matter would have any effect on the evidence to be brought.  If that evidence includes oral evidence from third parties, as distinct from documentary evidence, consideration should be given by both FBM and Mr Parrella to having those persons make a statement of their evidence whilst their recollection of events is relatively fresh.  If necessary, FBM or Mr Parrella may raise this issue when the matter returns to the Commission in three months.

16       A minute of the Order now issues.  FBM and Mr Parrella are requested to advise the Commission by 12 noon on Thursday, 11 October 2012 whether they agree that the Minute accurately reflects the decision in this matter, or whether a change to it is necessary for it to do so; if no change is necessary, the Order will issue in the terms of the Minute.