[2013] FWC 1585 |
FAIR WORK COMMISSION |
REASONS FOR DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Coates Hire Operations Pty Limited T/A Coates Hire Limited
v
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; Transport Workers’ Union of Australia
(C2012/6545)
COMMISSIONER BULL |
SYDNEY, 3 APRIL 2013 |
Order to produce documents – application to set aside order requiring production of documents - relevance and confidentiality – abuse of process.
[1] This is an application to set aside three orders for the production of documents issued at the request of Coates Hire Operations Pty Limited T/A Coates Hire Limited (Coates Hire) by the Commission on 15 February 2013 (the Orders). The Orders are directed to the Australian Manufacturing Workers’ Union (AMWU), U-Cover Pty Limited (U-Cover) and Hannover Life Re of Australasia Ltd (Hannover). The Orders provided that a party could apply to have them set aside or varied.
[2] I handed down a determination in respect of the Hannover Order at the conclusion of the hearing held on 13 March 2013. These are the reasons for that conclusion and a determination on all other outstanding matters.
Background
[3] The Orders were served in the context of a notification of dispute pursuant to s.739 of the Fair Work Act 2009 (the Act) and in particular the application of clause 21 - Income Protection of the Coates Hire Operations Pty Limited National Agreement 2012 (the Enterprise Agreement) which has a nominal expiry date of 31 March 2016.
[4] Clause 21 of the Enterprise Agreement provides that Coates Hire shall provide income protection insurance for all employees covered by the Enterprise Agreement through a product known as Wageguard which is provided by UCOVER Pty Limited or another insurance provider approved by the parties. Approval to use another provider is not to be “unreasonably” withheld by a party.
[5] The parties to the Enterprise Agreement are described at clause 3 as being Coates Hire, the AMWU, the Transport Workers Union of Australia (TWU), and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU).
[6] Coates Hire has sought approval from the three union parties to the Enterprise Agreement to use another insurance provider as required under clause 21 of the Enterprise Agreement. The request is made on the basis that alternate and equivalent income protection insurance can be obtained by Coates Hire at a lower premium. The current premium paid by Coates Hire is said to be $1.2 million per annum. 1
[7] The three unions have not agreed to a change of insurance provider, and the required income protection insurance is still being provided through U-Cover. Coates Hire argues that the three unions are withholding their approval to use another insurance provider contrary to clause 21 of the Enterprise Agreement that such approval not be “unreasonably” withheld.
[8] The question of the reasonableness or otherwise of the unions position not to grant approval is the issue in dispute listed for hearing before the Commission commencing on 13 May 2013.
[9] As a preliminary matter, Coates Hire have sought the production of documents pursuant to s.590(2)(c) from the AMWU the principal respondent union to the dispute and the two insurer entities, U-Cover and Hannover.
[10] Coates Hire was represented by Mr Herbert of Counsel who submitted that the documents sought are directly relevant to the question of unreasonableness.
[11] Documents are sought relating to the commercial and financial relationship between the AMWU and U-Cover. U-Cover is said by Coates Hire to be a joint venture entity owned by Coverforce Pty Ltd which the AMWU has ownership of approximately 50 per cent.
[12] Documents are also sought relating to the claims history under the Wageguard policy which are said to be relevant to the resolution of the dispute. Mr Herbert argued that unreasonable behaviour for the purposes of the Enterprise Agreement clause may arise from the closeness of the financial relationship between the AMWU and U-Cover (PN280).
[13] Documents are also sought which evidence any profits made by the AMWU relating to the Coates Hire group income protection scheme managed by U-Cover.
[14] Mr Herbert points to the 2011 annual financial report of the AMWU contained on the Commission’s website which states that the National Council received income of $1.164m from its associate U-Cover Pty Ltd (see transcript at PN 283). 2
[15] The AMWU represented by Ms Howell of Counsel oppose an order issuing requiring the production of documents not only against the AMWU but also against U-Cover and Hannover. The thrust of the AMWU opposition is that the categories of documents sought against themselves and the other parties are either:
● not relevant to the dispute or go beyond what is relevant;
● are commercial in confidence;
● amount to a fishing expedition; and/or are
● oppressive.
[16] U-Cover represented by Mr Gray of Counsel opposes the order made on the basis that compliance would be oppressive in the sense of the cost and effort required to comply. It is further argued that they are not a party to the dispute and are in the legal sense, strangers to the application.
[17] While U-Cover and Hannover are not direct parties to the dispute they clearly have an interest with U-Cover being the named provider in the Enterprise Agreement of the income protection insurance and Hannover being the insurer.
[18] The jurisdiction of the Commission to make an order for the production of documents arises from s.590 of the Act, and in particular 590(2)(c). The Act states:
590 Powers of the FWC to Inform Itself
....
590(2)...
(c) by requiring a person to provide copies of documents or records, or to provide any other information to FWC;
[19] In exercising its discretion to issue an order to produce documents, the Commission as stated by Munro J in Clerks (Alcoa) Case 3: will generally be guided by what applies in courts of law:
In its exercise of a broad discretion and judgement over use of the power, the Commission will have regard to practice followed in courts of law where a judicial discretion has been applied to regulate use of a subpoena to produce documents. Any such subpoena must specify with reasonable particularity documents which are required to be produced. It may be sufficiently specific to identify documents to be produced by reference to the subject matter to which they relate.
...
The documents sought must be of a nature capable of being relevant to an issue which might legitimately arise on the hearing of the matters in dispute.
...
A party will not be required to produce documents where to do so would be oppressive; or where the demand for production is a `fishing expedition’, in the sense that it is an endeavour not to obtain evidence to support a case, but to discover whether there is a case at all. Where the proper use of legal compulsion to produce documents is in issue, the tribunal will need to carry out an exercise of judgement upon the particular facts in each case. That judgement requires a balance on the one hand of the reasonableness of the burden imposed upon the recipient, and of the invasion of private rights, with on the other hand, the public interest in the due administration of justice and in ensuring that all material relevant to the issues be available to the parties to enable them to advance their respective cases.
[20] The issue of balancing the various rights of the parties was considered by Clarke J in Southern Pacific Hotel Services Inc v Southern Pacific Hotel Corporation Ltd 4:
If a court is called upon to rule that a subpoena is an abuse of process (ie oppressive) in this sense, it will need to carry out an exercise of judgment upon the particular facts in each case, including but not limited to the terms of the subpoena, bearing in mind the need to balance the reasonableness of the burden imposed upon the recipient and the invasion of his private rights with the public interest in the due administration of justice and, in particular, that all material relevant to the issues be available to the parties to enable them to advance their respective cases. There is, in every case, a clash between these competing interests and whilst the balancing exercise to which I have referred must be carried out, it is the latter interest which is predominant. If the needs of justice require or could require that a stranger be obliged to carry out a very burdensome task in the collection, transportation and production of a large number of documents, then a subpoena calling upon the stranger to produce those documents will be upheld.
[21] Confidentiality issues are also important to whether production of documents should be ordered. In Apache Northwest Pty Ltd v Western Power Corporation 5 a decision of the West Australian Court of Appeal referred to the balance between the need for confidentiality and the administration of justice.
The next issue is that relating to confidentiality. There is, no doubt, some need in this matter to balance competing interests. In the end, however, the public interest in the administration of justice should prevail - “[T]he risk to the confidentiality of the information must be tolerated in the interests of the administration of justice”, per King CJ in Alliance Petroleum Australia NL v The Australian Gas Light Company (supra), at 239, and see also at 238-239.
[22] The subject of confidentiality was addressed in the Santos Ltd v Pipelines Authority (SA) (No 2) 6 where Perry J, stated:
Absent such a claim [an arguable claim for privilege or other legally recognised objection to production], the courts have consistently set their face against the assertion that documents are not liable to be produced because of their commercial sensitivity. It does not matter whether the argument arises in the context of inter parties discovery, discovery against a third party, or as is the case here, in the context of an application to strike out a subpoena directed to a stranger to the proceedings.
The stand which the courts have consistently taken is that there is no immunity from production attaching to documents only because of their commercial sensitivity, although where thought fit, the court or tribunal to whom they are produced will take all reasonable steps so far as is possible to keep such documents confidential.
Hannover Life Re of Australasia Ltd
[23] The third entity from whom production of documents is sought by Coates Hire is Hannover, the named insurer for the purposes of the income protection insurance. By way of correspondence dated 28 February 2013, addressed to the Commission, Hannover have purported to comply with the production of documents order with the supply of two computer disks said to contain the requested documents.
[24] In respect of the documents sought from Hannover there is clearly no objection to their production by Hannover, rather the objection to their production is made by the AMWU.
[25] The order that was issued by the Commission to Hannover on 15 February 2013, requires the production of the following documents.
1. All documents evidencing claims made and circumstances notified by or on behalf of Coates Hire Operations Pty Limited or an Insured Person for the period since 1 July 2011 to date under all “Wageguard” group income protection insurance products purchased by Coates Hire Operations Pty Limited as managed by U-Cover Pty Limited and/or Coverforce Pty Limited, including documents evidencing details of whether each claim or circumstance is open or closed, the nature of each claim or circumstance and payments made by the insurer in respect of each claim. (In this paragraph “Insured Person” has the same meaning as that expression is defined in the Wageguard by U-Cover Pty Limited Group Income Protection for Employees Master Policy Document Issue Date 1 July 2011 (Updated 3 August 2012).)
[26] As can be seen from the above, the documents sought, relate to the claims history as it applies to Coates Hire employees. This information is said to have been previously provided by U-Cover to Coates Hire but the practice ceased in July 2012. It is difficult to appreciate how the claims history could be considered ‘commercial in confidence’ when such information, was up until recently provided to Coates Hire and Hannover have not objected to its release.
[27] I accept the position put by the AMWU that they have standing to object to an order directed to an entity not a party to the dispute and further that an order should be set aside where it involves an abuse of process or is not relevant to the dispute. 7
[28] In considering the opposition by the AMWU to the Hannover production of documents order, I start from the position that all material available to support each party’s respective position should be made available to ensure a just outcome subject to balancing the burden forced upon Hannover together with the issues of relevancy and confidentiality. (see Southern Pacific Hotel Services Inc v Southern Pacific Hotel Corporation Ltd 8.
[29] It is noted also that the Commission will generally exercise its discretion in favour of an order for production of documents unless it appears that an order would be an abuse of process. (see R v Marks; Ex parte Australian Building Construction Employees Builders Labourers’ Federation 9).
[30] As the documents have already been provided by Hannover to the Commission without objection, the issue of their relevance can be the only substantial point of contention.
[31] Coates Hire submits that the claims history of its employees is materially relevant and would normally be provided as a matter of course. Such information is of necessity used by an insurer to establish an appropriate premium. Coates Hire argues that the premium demanded by U-Cover compared to that offered by two proposed alternate insurers is relevant as to whether the objection to alternate insurers is reasonable.
[32] In my view the necessary relevance is made out by Coates Hire in seeking production of the documents relating to the claims history. As such, the order against Hannover will remain and inspection of the documents will be facilitated by the Commission for any party to the dispute.
AMWU
[33] Subsequent to the hearing of this matter on 13 March 2013, Coates Hire has submitted a revised set of orders applying to the AMWU and U-Cover.
[34] At the hearing of this matter the AMWU opposed the production of documents on the grounds outlined above. During the hearing Coates Hire suggested a number of amendments to the proposed order to accommodate the AMWU’s and U-Cover’s concerns. At the conclusion of the hearing the Commission requested that the AMWU, U-Cover and Coates Hire attempt to reach agreement where possible and advise the Commission of any remaining areas of disagreement.
[35] The Commission was subsequently advised that the parties had not reached a consensus and that a determination by the Commission was required.
[36] In this matter the AMWU argue that the production of documents in the proposed orders submitted by Coates Hire are oppressive and tantamount to a fishing expedition. The changes to the orders proposed by Coates Hire do not satisfy the AMWU who in correspondence to the Commission dated 27 March 2013, maintained their objections to the orders being sought.
U-Cover
[37] The submissions of Mr Gray on behalf of U-Cover went to the onerous and oppressive nature of the orders sought, which was said to be magnified as U-Cover is not a party to the dispute. U-Cover maintain opposition to the word “evidencing” used in the original orders as requiring a search of all documents that could take months as per the affidavit of Mr Jim Angelis Managing Director of U-Cover. Mr Gray submitted that U-Cover did not oppose complying with any reasonable order to produce documents. 10
[38] In an email to Coates Hire from U-Cover’s solicitors dated 22 March 2013, a request was made that should any further order be made relating to income and profit statements of U-Cover these statements should be limited to Coates Hire’s solicitors and counsel.
Consideration
[39] There is no doubt that an order requiring the production of documents impacts on the privacy of the party producing the documents. As such, an order should only extend to what is necessary for the requesting party to advance their case and not any other foreign purpose that may lead to an abuse of process. 11
[40] The AMWU and U-Cover argued that the word “evidencing” used in the orders sought was oppressive as it catches every single document that the AMWU and U-Cover have in its possession that makes any reference to the subject matter in the orders. 12
[41] In response Coates Hire submitted that the orders it sought required a commonsense approach that did not require the extensive exercise that the AMWU or U-Cover had submitted, but has now substituted the word “evidencing” with the word “containing”.
[42] What Coates Hire seeks in respect of the financial relationship between the AMWU and U-Cover is the documentation that evidences that relationship. It is not necessary and would clearly be oppressive to order that all documents evidencing or containing the terms and conditions of the joint venture be produced.
[43] I have taken into consideration the matters raised by the AMWU and believe it is necessary to reduce the burden of production of documents where possible, weighed against Coates Hire’s right to access documents relevant to establishing their argument of unreasonableness on behalf of the AMWU and other unions.
[44] I am not able to accept as is put by the AMWU that Coates Hire are seeking documents for ulterior purposes which have no relationship to the dispute before the Commission. 13
[45] The documentation requested may illuminate the issues sought to be demonstrated by Coates Hire as to the reasonableness or otherwise of the unions in declining to agree to the change of income protection provider proposed by Coates Hire. The documentation sought appears to me to have prima facie, an apparent relevance to the issues raised by Coates Hire and thus a legitimate forensic purpose not to be an abuse of process. (See Trade Practices Commission v Arnotts Limited 14)
[46] I will adjust the Applicant’s proposed orders, to state that the documents which reflect the existing terms and conditions of the joint venture between the AMWU and U-Cover be produced. This will not require production of every document in existence only those documents that clearly establish the terms and conditions of the joint venture. These documents will, until further order, be limited to Coates Hire’s solicitors and counsel.
[47] In respect of documents sought from the AMWU that exist in respect of fees paid to Mr Glenn Thompson as a Director of U-Cover this requirement cannot impose any burden on the AMWU as the AMWU state that no documents exist as Mr Thompson does not receive any financial benefit as a Director of U-Cover.
[48] As sought in the amended order by Coates Hire, the AMWU are to serve a summary of commissions, profits or monetary benefits received in respect of income protection purchased by Coates Hire managed by U-Cover for the periods requested. This will not require as did the original order the production of all documents evidencing commissions, profits or monetary benefits received.
[49] The AMWU do not oppose providing Coates Hire with a copy of their audited financial report for the year ended 30 September 2012 within seven days of it being filed in the Commission.
[50] Similar findings on the same subject matters are made in respect of U-Cover’s objections. In respect of the income and profit statements of U-Cover sought by Coates Hire, I will limit these statements to the 2011/2012 financial year and a statement up until 28 February 2013. These documents are significantly less onerous than those sought in the original order.
[51] On the application of the AMWU and U-Cover the orders issued on 15 February 2013, in respect of the AMWU and U-Cover will be set aside and replaced with orders in the manner described above.
[52] In respect of the obligations that attach to the production of documents pursuant to a direction from an arbitrator, I see no reason why the implied undertakings referred to by the High Court in Hearne v Street 15 would not have application.
[53] Orders will be issued in conjunction with this decision (PR535329).
COMMISSIONER
Appearances:
A Herbert of Counsel for Coates Hire Operations Pty Limited
C Howell of Counsel for the AMWU
S Gray of Counsel for U-Cover Pty Ltd
Hearing details:
2013.
Sydney:
13 March.
1 Transcript at PN300
2 See Para 44 of Coates Hire submissions in reply
3 [1988] AIRC 391 Print H2892 at p 2
4 [1984] 1 NSWLR 710, at 719-720
5 (1998) 19 WAR 350 (Kennedy, Pidgeon and Franklyn JJ) at p 379E
6 (1996) 186 LSJS 257 (SACA)
7 Fried v National Australia Bank Ltd (2000) 175 ALR per Weinberg J at [18]
8 [1984] 1 NSWLR 710 at 719-720
9 (1981) 147 CLR 471 Mason J at p 483
10 Transcript at PN265
11 Harman v Secretary of State for the Home Department [1983] 1 AC 280 at 308 and Riddick v Thames Board Mills Ltd per Lord Denning MR [1977] QB 881 at 300
12 I note the AMWU have sought orders for production of documents against Coates Hire received in the Commission on 27 March 2013, makes frequent use of the word “evidencing”
13 Transcript at PN66
14 (1989) 88 ALR 90 at 103
15 [2008] 235 CLR 125 at 154-155
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